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

FORM 10-QSB



|[x]    | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period endedSeptember 30, 2005
|------ | ----------------------------------------------------------------------------------------------------------------------------------
|       | OR                                                                                                                                
|[    ] | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT                                                                   
|       | For the transition period from __________ to ___________                                                                          

Commission file number 333-41516

LUNA GOLD CORP.(Exact name of small business issuer as specified in its charter)



|Wyoming(State or other jurisdiction of incorporation or organization) |  | 98-0226032 (I.R.S. Employer Identification No.)
|--------------------------------------------------------------------- |  | -----------------------------------------------

Suite 920, 475 West Georgia Street 
Vancouver, British Columbia 
Canada V6B 4M9(Address of principal executive offices)

(604) 689-7317(Issuer's telephone number)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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.     Yes [X]        No  [    ]

The Company is a Shell company:  Yes [    ]        No [X]

Shares outstanding as at November 14, 2005:  24,572,700

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PART I - FINANCIAL INFORMATION

Item 1.     Financial Statements.

The Company's financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.



LUNA GOLD CORP.
INTERIM FINANCIAL STATEMENTS



|                               | Page                                                     
|------------------------------ | ---------------------------------------------------------
|                               |                                                          
|PART I - FINANCIAL INFORMATION |                                                          
|Item 1.                        | Consolidated Balance Sheets                              
|                               | Consolidated Statements of Operations                    
|                               | Consolidated Statements of Stockholders' Deficiency      
|                               | Consolidated Statements of Cash Flows                    
|                               | Notes to Financial Statements                            
|Item 2.                        | Management's Discussion and Analysis or Plan of Operation
|Item 3.                        | Controls and Procedures                                  
|                               |                                                          
|PART II - OTHER INFORMATION    |                                                          
|Item 2.                        | Changes in Securities and Use of Proceeds                
|Item 6.                        | Exhibits                                                 













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Consolidated Financial Statements

LUNA GOLD CORP. (Expressed in United States dollars)
Three-month and nine-month period ended September 30, 2005 and 2004
Period from January 20, 2003 (inception of new business)
to September 30, 2005

















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LUNA GOLD CORP.Consolidated Balance Sheets(Expressed in United States dollars)

Unaudited - Prepared by Management



|                                                                                                                                              |   | September 30, 2005
(unaudited) |  | December 31, 
2004
|--------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------------------------ |  | ------------------
|Assets                                                                                                                                        |   |                                |  |                   
|                                                                                                                                              |   |                                |  |                   
|Current assets:                                                                                                                               |   |                                |  |                   
|Cash and cash equivalents                                                                                                                     | $ | 638,749                        |  | 1,497,859         
|Short-term investments                                                                                                                        |   | 303,851                        |  | --                
|Accounts receivable                                                                                                                           |   | 298,304                        |  | 11,435            
|Prepaid expenses                                                                                                                              |   | 5,147                          |  | 6,023             
|                                                                                                                                              |   |                                |  |                   
|Total current assets                                                                                                                          |   | 1,246,051                      |  | 1,515,317         
|                                                                                                                                              |   |                                |  |                   
|Equipment                                                                                                                                     |   | 2,476                          |  | 4,788             
|                                                                                                                                              |   |                                |  |                   
|Investment in resource properties joint ventures (note 2(b))                                                                                  |   | --                             |  | 251,197           
|                                                                                                                                              |   |                                |  |                   
|Total assets                                                                                                                                  | $ | 1,248,527                      |  | 1,771,302         
|Liabilities and stockholders' deficiency                                                                                                      |   |                                |  |                   
|Current liabilities:                                                                                                                          |   |                                |  |                   
|Accounts payable and accrued liabilities                                                                                                      | $ | 112,885                        |  | 62,192            
|Note payable                                                                                                                                  |   | --                             |  | 49,997            
|Payables to related parties (note 5)                                                                                                          |   | 30,390                         |  | 576,523           
|Total current liabilities                                                                                                                     |   | 143,275                        |  | 688,712           
|                                                                                                                                              |   |                                |  |                   
|Subscriptions received in advance of share offering                                                                                           |   | --                             |  | 1,639,065         
|                                                                                                                                              |   |                                |  |                   
|Total liabilities                                                                                                                             |   | 143,275                        |  | 2,327,777         
|                                                                                                                                              |   |                                |  |                   
|Stockholders' equity (deficiency):                                                                                                            |   |                                |  |                   
|Common stock, no par value, unlimited authorized shares; issued 24,572,700
At September 30, 2005 and 17,004,865 at December 31, 2004 (note 4) |   | 7,899,276                      |  | 5,628,926         
|Additional paid-in capital                                                                                                                    |   | 182,746                        |  | 182,746           
|Deficit before inception of new business                                                                                                      |   | (4,796,115)                    |  | (4,796,115)       
|Deficit accumulated since inception of new business                                                                                           |   | (2,198,489)                    |  | (1,542,432)       
|Accumulated other comprehensive income:
Cumulative translation adjustment                                                                     |   | 17,835                         |  | (29,600)          
|Total stockholder's deficiency                                                                                                                |   | 1,105,253                      |  | (556,475)         
|Total liabilities and stockholders' equity                                                                                                    | $ | 1,248,527                      |  | 1,771,302         

The accompanying notes are an integral part of these financial statements

Approved on behalf of the Board:

|/s/  Tim Searcy
Tim Searcy, Director | /s/ Marcel de Groot
Marcel de Groot, Director
|------------------------------------ | ---------------------------------------------



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LUNA GOLD CORP.Consolidated Statements of Operations(Expressed in United States dollars)

Unaudited - Prepared by Management



|                                                                         |   | Three month period ended
Sept 30, |  | Nine month period
ended Sept 30, |  | Period from
January 20/03 (inception of new business) to Sept 30, 2005
|------------------------------------------------------------------------ | - | --------------------------------- |  | -------------------------------- |  | ----------------------------------------------------------------------
|                                                                         |   | 2005                              |  | 2004                             |  | 2005                                                                  
|                                                                         |   |                                   |  |                                  |  |                                                                       
|                                                                         |   |                                   |  |                                  |  |                                                                       
|Operating expenses:                                                      |   |                                   |  |                                  |  |                                                                       
|Business development                                                     | $ | 3,775                             |  | 7,489                            |  | 25,910                                                                
|Consulting fees                                                          |   | 12,137                            |  | 37,417                           |  | 82,424                                                                
|Depreciation and amortization                                            |   | 808                               |  | 528                              |  | 2,350                                                                 
|Equity (recovery) from
operation of resource
properties joint ventures   |   | (152,169)                         |  | 13,774                           |  | 64,792                                                                
|Exploration expense                                                      |   | 44,293                            |  | 22,421                           |  | 127,668                                                               
|Filing fees                                                              |   | 1,737                             |  | 3,127                            |  | 26,136                                                                
|General and administrative                                               |   | 8,500                             |  | 8,561                            |  | 30,250                                                                
|Investor relations                                                       |   | --                                |  | 10,823                           |  | 2,140                                                                 
|Management fees to related 
parties (note 5)                             |   | 6,321                             |  | 5,808                            |  | 18,380                                                                
|Marketing and promotion                                                  |   | 569                               |  | 329                              |  | 3,140                                                                 
|Organization expense                                                     |   | --                                |  | --                               |  | --                                                                    
|Professional fees                                                        |   | 40,878                            |  | 37,938                           |  | 126,984                                                               
|Rent                                                                     |   | 2,796                             |  | 10,960                           |  | 8,986                                                                 
|Travel and conference                                                    |   | 14,642                            |  | 40,197                           |  | 50,993                                                                
|Wages and benefits                                                       |   | 19,523                            |  | 23,705                           |  | 68,551                                                                
|Total expenses                                                           |   | 3,810                             |  | 223,077                          |  | 638,704                                                               
|                                                                         |   |                                   |  |                                  |  |                                                                       
|Loss from operations                                                     |   | (3,810)                           |  | (223,077)                        |  | (638,704)                                                             
|Foreign exchange gain (loss)                                             |   | (58,096)                          |  | (12,762)                         |  | (21,154)                                                              
|Interest income                                                          |   | 3,992                             |  | --                               |  | 5,533                                                                 
|Interest expense                                                         |   | --                                |  | --                               |  | (1,733)                                                               
|Net loss for the period                                                  | $ | (57,913)                          |  | (235,839)                        |  | (656,057)                                                             
|                                                                         |   |                                   |  |                                  |  |                                                                       
|Loss per common share, basic 
and diluted                                | $ | (0.00)                            |  | (0.02)                           |  | (0.03)                                                                
|                                                                         |   |                                   |  |                                  |  |                                                                       
|Weighted average number of
common shares outstanding: 
basic and diluted |   | 24,572,700                        |  | 13,689,627                       |  | 24,073,720                                                            

The accompanying notes are an integral part of these financial statements





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LUNA GOLD CORP.Consolidated Statements of Stockholders' Equity (Deficiency)(Expressed in United States dollars)

Unaudited - Prepared by Management



|                                                                                            | Common Shares | Additional
Paid-In Capital | Deficit accumulated
Prior to
Inception of New Business
|------------------------------------------------------------------------------------------- | ------------- | -------------------------- | ------------------------------------------------------
|                                                                                            | Shares        | Amount                    
|Balance, December 31, 2003                                                                  | 12,441,948    | $                          | 5,068,305                                             
|                                                                                            |               |                            |                                                       
|Issuance of common stock on exercise of warrants issued on August 8, 2003 private placement | 96,250        |                            | 24,063                                                
|Issuance of common stock on exercise of warrants on June 30, 2004                           | 4,416,667     |                            | 523,558                                               
|Issuance of common stock for exploration on
August 8, 2004                                  | 50,000        |                            | 13,000                                                
|Adjustment to cumulative translation account                                                | --            |                            | --                                                    
|                                                                                            |               |                            |                                                       
|Balance, December 31, 2004                                                                  | 17,004,865    | $                          | 5,628,926                                             
|                                                                                            |               |                            |                                                       
|Issuance of common stock on January 19, 2005 private placement (Note 4(d))                  | 7,567,835     |                            | 2,270,350                                             
|Balance, September 30, 2005                                                                 | 24,572,700    | $                          | 7,899,276                                             

 :



|                                                                                            | Deficit Accumulated
Since Inception of New Business | Cumulative
Translation
Adjustment | Total
Stockholders'
Equity
(Deficiency) | Comprehensive
Income
(Loss)
|------------------------------------------------------------------------------------------- | --------------------------------------------------- | --------------------------------- | --------------------------------------- | ---------------------------
|Balance, December 31, 2003                                                                  | $                                                   | (466,688)                         | $                                       | (25,264)                   
|                                                                                            |                                                     |                                   |                                         |                            
|Loss for the period                                                                         |                                                     | (1,075,744)                       |                                         | --                         
|Issuance of common stock on exercise of warrants issued on August 8, 2003 private placement |                                                     | --                                |                                         | --                         
|Issuance of common stock on exercise of warrants on June 30, 2004                           |                                                     | --                                |                                         | --                         
|Issuance of common stock for exploration on 
August 8, 2004                                 |                                                     | --                                |                                         | --                         
|Adjustment to cumulative translation account                                                |                                                     | --                                |                                         | (4,336)                    
|Balance, December 31, 2004                                                                  | $                                                   | (1,542,432)                       | $                                       | (29,600)                   
|                                                                                            |                                                     |                                   |                                         |                            
|Loss for the period                                                                         |                                                     | (656,057)                         |                                         | --                         
|Issuance of common stock on January 19, 2005 private placement (Note 4(d))                  |                                                     | --                                |                                         | --                         
|Adjustment to cumulative translation account                                                |                                                     | --                                |                                         | 47,435                     
|Balance, September 30, 2005                                                                 | $                                                   | (2,198,489)                       | $                                       | 17,835                     

The accompanying notes are an integral part of these financial statements



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LUNA GOLD CORP.Consolidated Statements of Cash Flows(Expressed in United States dollars)

Unaudited - Prepared by Management



|                                                                              |   | Three Month period ended
September 30, |  | Nine Month period
ended September 30, | Period from Jan. 20, 2003 (inception of new business) to September 30,
|----------------------------------------------------------------------------- | - | -------------------------------------- |  | ------------------------------------- | ----------------------------------------------------------------------
|                                                                              |   | 2005                                   |  | 2004                                  |                                                                       
|Cash flow from operating activities:                                          |   |                                        |  |                                       |                                                                       
|Net loss                                                                      | $ | (57,913)                               |  | (235,839)                             |                                                                       
|Items not affecting cash:                                                     |   |                                        |  |                                       |                                                                       
|Depreciation and amortization                                                 |   | 808                                    |  | 528                                   |                                                                       
|Issuance of shares for exploration                                            |   | --                                     |  | --                                    |                                                                       
|Equity (recovery) in loss from 
Operations,  non cash                         |   | (10,410)                               |  | 13,774                                |                                                                       
|                                                                              |   |                                        |  |                                       |                                                                       
|Changes in operating assets and liabilities:                                  |   |                                        |  |                                       |                                                                       
|Accounts receivable                                                           |   | (18,488)                               |  | (3,205)                               |                                                                       
|Prepaid expenses                                                              |   | 5,000                                  |  | (2,079)                               |                                                                       
|Accounts payable and accrued liabilities                                      |   | 7,382                                  |  | (43,259)                              |                                                                       
|Note payable                                                                  |   | --                                     |  | --                                    |                                                                       
|Net cash used in operating activities                                         |   | (73,621)                               |  | (270,080)                             |                                                                       
|                                                                              |   |                                        |  |                                       |                                                                       
|Cash flow from investing activities:                                          |   |                                        |  |                                       |                                                                       
|Joint venture interests acquisition                                           |   | 452,130                                |  | --                                    |                                                                       
|Purchase of short-term investments                                            |   | (2,438)                                |  | --                                    |                                                                       
|Purchase/ disposal of equipment                                               |   | --                                     |  | (448)                                 |                                                                       
|Investment in resource properties
joint ventures                              |   | --                                     |  | --                                    |                                                                       
|Net cash provided by (used in) investing activities                           |   | 449,692                                |  | (448)                                 |                                                                       
|                                                                              |   |                                        |  |                                       |                                                                       
|Cash flow from financing activities:                                          |   |                                        |  |                                       |                                                                       
|Payable to related parties                                                    |   | (28,314)                               |  | 238,211                               |                                                                       
|Proceeds from issuance of shares for cash                                     |   | --                                     |  | --                                    |                                                                       
|Proceeds from exercise of warrants                                            |   | --                                     |  | 9,731                                 |                                                                       
|Net cash provided by (used in) financing activities                           |   | (28,314)                               |  | 247,942                               |                                                                       
|                                                                              |   |                                        |  |                                       |                                                                       
|Increase (decrease) in cash and cash equivalents                              |   | 347,757                                |  | (22,586)                              |                                                                       
|Effect of exchange rate changes on foreign currency denominated cash balances |   | 66,067                                 |  | 1,685                                 |                                                                       
|Cash and cash equivalents, beg. of period                                     |   | 224,925                                |  | 60,835                                |                                                                       
|Cash and cash equivalents, end of period                                      | $ | 638,749                                |  | 39,934                                |                                                                       
|Supplemental disclosure:                                                      |   |                                        |  |                                       |                                                                       
|Interest income (expense) net                                                 | $ | 3,992                                  |  | --                                    |                                                                       
|Income taxes                                                                  |   | --                                     |  | --                                    |                                                                       
|Issuance for common stock for debt                                            |   | --                                     |  | --                                    |                                                                       
|Subscriptions converted to common stock                                       |   | --                                     |  | --                                    |                                                                       

The accompanying notes are an integral part of these financial statements









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LUNA GOLD CORP.Consolidated Notes to Financial Statements(Expressed in United States dollars)

Unaudited - Prepared by Management

Three-month and nine-month period ended September 30, 2005 and 2004
Period from January 20, 2003 (inception of new business) to September 30, 2005

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1.     Nature of Operations:

The Company was incorporated on June 24, 1986 in British Columbia, Canada.  In July 1999, the Company redomiciled to Wyoming State, USA.  From July 1999 until January 2003, as described in the Company's consolidated financial statements filed with the 2004 annual report on Form 10-KSB, the Company's focus was on the streaming-media business.  These efforts ceased in January 2003 as the Company refocused its efforts from the streaming-media business and entered the mining exploration business (note 3).  As the Company has no producing properties, the Company is considered to be in the exploration stage and financial information from January 20, 2003, the inception of the mining business, has been presented in these financial statements. Additional debt or equity financing will be required from existing shareholders or third parties in order to provide working capital for operations in the future.  This debt or equity may not be available on reasonable terms or on any terms at all.

These financial statements have been prepared on a going concern basis in accordance with United States generally accepted accounting principles.  The going concern basis of presentation assumes the Company will continue to operate for the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business.  Certain conditions, described below, currently exists which raise substantial doubt upon the validity of this assumption.  These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

2.     Significant Accounting Policies:

(a)     Basis of presentation:

The financial statements have been prepared in accordance with generally accepted accounting principles in the United States.  There are no material measurement differences to these financial statements to Canadian generally accepted accounting principles.  The interim financial statements do not include all information and footnote disclosures required under generally accepted accounting principles in the United States or Canada for a complete set of annual financial statements.  Results of operations for the periods ended September 30, 2005 are not necessarily indicative of what the results will be for the 2005 fiscal year.

In the opinion of management, these unaudited financial statements reflect all adjustments, consisting solely of normal recurring accruals, considered necessary for a fair presentation of the financial position as at September 30, 2005 and results of operations and cash flows for the nine-months ended September 30, 2005 and 2004, and the period from January 20, 2003 (inception of new business) to September 30, 2005.



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2.     Significant Accounting Policies (Cont'd):

These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company's annual report on Form 10-KSB which includes the Company's financial statements for the year ended December 31, 2004.

(b)     Principles of consolidation:

These consolidated financial statements include the accounts of the Company's wholly-owned subsidiaries Compania Minera Antero gold S.A. de C.V., Eureka Gold Inc., Luna Gold (China) Corp. and Luna Gold (Liaoning) Corp.  In addition, these consolidated financial statements also include the accounts of Xinan Mineral Resources Co. Ltd. and Xinlong Mineral Resources Co. Ltd., joint venture companies which the Company is entitled to 100% of the net assets.  All significant inter-company transactions and balances have been eliminated.

As described in note 3(c) and (d), in the period ended September 30, 2005 the Company and its Chinese co-venture partner agreed to terminate their joint ventures related to the Xinan and Xinlong mineral property interests.  This termination received government approval, also in the period.  In prior periods, the Company had accounted for its interest in these joint ventures by the equity method and, accordingly, reflected only its net investment, which reflected its proportionate interest in the net monetary assets of the joint ventures, on the consolidated balance sheet as "Investment in resource properties joint ventures", with changes in the investment account recognized in net loss.  As a result of the termination arrangements, the Company now consolidates 100% of the assets and liabilities of the joint ventures in these consolidated financial statements.  As the joint ventures did not meet the definition of businesses for accounting purposes, the termination agreements did not result in a business combination.  The assets of the joint ventures are represented by cash (September 30, 2005 - $503,264) and accounts receivable (September 30, 2005 - $196,762) and the liabilities are represented by accounts payable and accrued liabilities (September 30, 2005 - $49,521).  The accounting for consolidation pursuant to the termination agreement resulted in an increase in the Company's reported cash and cash equivalents equal to the cash and cash equivalents of the joint ventures at termination.  This increase in the Company's cash balance is reflected in the consolidated statements of cash flows by an adjustment to the recovery from operation of resource property joint ventures of $141,759, which reflects the cash contributions made by the Company on behalf of the co-venture partner that had not been expended by the joint ventures and that the Company had previously expensed due to uncertainty of collection, with the balance, reflecting the Company's proportionate interest of the joint ventures remaining cash on hand prior to the termination , as a cash contribution investing activity.

(c)     Use of estimates:

The preparation of financial statements in accordance with generally accepted accounting principles requires that management make estimates and reasonable assumptions which impact the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the balance sheets, and the reported amounts of revenues and expenses during the reporting periods.  Actual amounts may differ from these estimates.

(d)     Foreign currency:

The Company uses the United States dollar as its reporting currency.

Canadian operations, which have the Canadian dollar as the functional currency, are translated to United States dollars as follows: assets and liabilities are translated at the exchange rate at the balance sheet date.  Revenues and expenses are translated at the average rate for the period.  Exchange gains and



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2.     Significant Accounting Policies (Cont'd):

losses resulting from the translation are excluded from the determination of income and reported as the cumulative translation adjustment in stockholder's equity.

Other exchange gains and losses arising on the settlement of foreign currency denominated monetary items are included in the statement of operations.

(e)     Loss per share:

Basic loss per share is calculated based on the weighted average number of common shares outstanding during the periods.  Excluded from the weighted average number of common shares are 213,839 common shares (September 30, 2004 - 213,839) held in escrow that are to be released based on financial performance criteria (note 4 (a)).

Diluted loss per share is computed using the weighted average number of common and potentially dilutive common shares outstanding during the period.  Excluded from the calculation of diluted loss per share are 1,415,000 stock options (2004 - 1,860,000).

(f)     Income taxes:

Income taxes are accounted for under the asset and liability method.  Current taxes are recognized for the estimated income taxes for the current period.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and the benefit of operating loss and tax credit carry forwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  A valuation allowance is recorded for deferred tax assets when it is not more likely than not that such deferred tax assets will be realized.

(g)     Mineral Property Interests:

The Company accounts for its mineral property interests whereby all acquisition and exploration costs are charged to expense as incurred and all property sales and option proceeds received are credited to income.  When the existence of a proven or probable mineral reserve on a property has been established, future acquisition, exploration and development costs will be capitalized for that property.  After commercial production on the property commences, the net capitalized costs will be charged to future operations using the unit of production method based on estimated recoverable reserves on the property.

(h)     Stock-based compensation:

The Company applies the intrinsic value-based method of accounting prescribed by Accounting Principles Board ("APB") Opinion No. 25 "Accounting for Stock Issued to Employees", and related interpretations, in accounting for its fixed stock option plan.  As such, compensation expense would be recorded on the date of grant only if the current market price of the underlying stock exceeds the exercise price. Compensation expense for stock options is recognized over the vesting period.  Options granted to other than employees and directors are measured at their fair value as the services are performed and the options earned.  For the periods ended September 30, 2005 and 2004, no stock-based compensation has been recognized in expenses.



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2.     Significant Accounting Policies (Cont'd):

If the fair-value method had been used, an additional expense of nil (2004 - $224,414) would have been recognized for stock-based compensation for the nine months ended September 30, 2005, and $249,645 for the period from inception of new business on January 20, 2003 to September 30, 2005. Pro forma basic and diluted loss per share would have been $0.03 (2004 - $0.06) and $0.15 respectively.

3.     Mining Property Interests

(a)     Blue Mountain Project

The Company entered into an agreement dated March 18, 2003 with Nassau Ltd. ("Nassau") an unrelated private U.S. company, to acquire 100% of the interest held by Nassau in a mining property located in Nevada, U.S.A.

In order to acquire the interest, the Company has entered into an option agreement with Nassau, pursuant to which agreement Nassau granted the Company the option to acquire a 100% interest in certain mining claims known as the Blue Mountain project which is made up of 31 mining claims and is located in Humboldt County, Nevada approximately 20 miles west of Winnemucca, Nevada (the "Blue Mountain Project").

In accordance with the terms of its agreement with Nassau, the Company has agreed that in order to acquire a 100% interest in the Blue Mountain Project, the Company will make the following payments and issue the following shares to Nassau:



|(i)   | 50,000 shares were issued on August 8, 2003 when the TSX Venture Exchange (the "TSX") approved (the "Approval Date") the Blue Mountain Project as a "qualifying property" (as defined within the rules and policies of the TSX);
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(ii)  | An additional 50,000 shares were issued on Aug 8, 2004;                                                                                                                                                                         
|(iii) | Two years following the Approval Date a payment in the amount of $20,000 (PAID);                                                                                                                                                
|(iv)  | Three years following the Approval Date a payment in the amount of $30,000;                                                                                                                                                     
|(v)   | Four years following the Approval Date a payment in the amount of $40,000;                                                                                                                                                      
|(vi)  | Five years following the Approval Date a payment in the amount of $100,000; and                                                                                                                                                 
|(vii) | Six years following the Approval Date a payment in the amount of $1,300,000 (the "Final Payment").                                                                                                                              

Upon the Company making the Final Payment to Nassau then the Company will own 100% of the Blue Mountain Project subject only to a 2% net smelter royalty on gold (the "Royalty") and the Company will have the right to buy down the Royalty to a 1% NSR by paying Nassau the sum of $1,500,000 at any time prior to completion of the first year of production.  All payments are in U.S. dollars.

(b)     Red Rock (formerly LS Property)

On March 4, 2004, the Company acquired an option on the Red Rock Property, and has the right to acquire a 100% interest, in these 80 mineral claims located in Lander County, Nevada, subject to a retained 3% net smelter royalty.  The Company made an initial $5,000 payment upon execution of the agreement dated February 27, 2004, and will, at the Company's option, make further cash payments totaling $1,400,000 over a 15 year period.



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3.     Mining Property Interests (Cont'd):

The schedule of payments and work commitments is as follows:



|Due Date                  |   | Cash Payment  | Work Commitment
|------------------------- | - | ------------- | ---------------
|On execution of Agreement | $ | 5,000 (PAID)  | $              
|By Yr. 1 Anniversary      | $ | 15,000 (PAID) | $              
|By Yr. 2 Anniversary      | $ | 25,000        | $              
|By Yr. 3 Anniversary      | $ | 50,000        | $              
|By Yr. 4 Anniversary      | $ | 155,000       | $              
|By Yr. 5 Anniversary      | $ | 250,000       | $              
|By Yr. 6 Anniversary      | $ | 250,000       | $              
|By Yr. 7 Anniversary      | $ | 250,000       | $              
|Each of Yrs. 8 to 15      | $ | 50,000        | $              
|TOTAL                     | $ | 1,400,000     | $              

On September 12, 2005 the Company signed a letter of intent with Centerra (U.S.) Inc. (Centerra) in which Centerra can acquire up to an undivided 60% interest in the property with the Company and can subsequently acquire up to an additional 15% in the property.  Under the terms of the proposed agreement, Centerra has agreed to spend a total of $1,900,000 over a 6 year period to acquire an undivided 60% interest in the property at which time Centerra will have the option to spend a further $3,100,000 over a 4 year period for an additional undivided 15% in the property.

(c)     Dongchuan Project

On June 2, 2004, the Company entered into a formal co-operative agreement with Yunnan Nonferrous Mining and Geology Ltd. ("YNMG") pursuant to which it established a Sino-Foreign co-operative joint venture company in the Yunnan Province, PRC.

The joint venture company is called the Xinan Mineral Resources Co. Ltd.  It was established for the purpose of jointly exploring and, if successful, mining any viable deposits discovered in the Dongchuan area of the Yunnan, Province, PRC.

The Company had agreed to invest, at its option, a total of US$3.1 million over three years to earn a 70% interest in the co-operative company.  After the company earned a 70% interest, the company may earn a further 20 % interest in the co-operative company by investing an additional US$6 million.

In 2005 the Company reached an agreement with its joint venture partner and received government approval to terminate the co-operative agreement on its Dongchuan project.  All unexpended amounts paid to the co-operative company will be returned to the Company and all rights to the property will be returned to Yunnan Nonferrous Mining and Geology Ltd.  Before the unexpended amounts are returned, the Company has agreed to pay a termination fee of approximately $24,000.

(d)     Gongguo Project

On May 18, 2004 the Company entered into a formal co-operative agreement with Yunnan Nonferrous Mining and Geology Ltd. ("YNMG") to establish a Sino-Foreign co-operative joint venture company in Yunnan Province, PRC.





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3.     Mining Property Interests (Cont'd):

The joint venture company is called the Xinlong Mineral Resources Co. Ltd.  It is established for the purpose of jointly exploring and, if successful, mining any viable deposits discovered in the Gongguo area of the Yunnan, Province, PRC.

The Company agreed to invest, at its option, a total of US$3.05 million over three years to earn an 80% interest in the co-operative company.  After the Company has earned its 80% interest, contributions to the co-operative company will be made pro rata, provided that YNMG's interest can be diluted to not less than 10% if it elects not to make cash contributions.

In 2005 the Company reached an agreement with its joint venture partner and received government approval to terminate the co-operative agreement on its Gongguo project.  All unexpended amounts paid to the co-operative company will be returned to the Company and all rights to the property will be returned to Yunnan Nonferrous Mining and Geology Ltd.  Before the unexpended amounts are returned, the Company has agreed to pay a termination fee of approximately $24,000.

4.     Stockholders' Equity:

(a)     Escrowed stock:

At December 31, 2004, 213,839 (2003 - 213,839) common shares outstanding were held in escrow.

These shares are releasable from escrow on satisfaction of certain predetermined tests set out by the TSX Venture Exchange related to the generation of positive cash flow from operations. Stock not released from escrow within 10 years of the date of their issuance will be cancelled.  Pursuant to the escrow agreements, holders of the stock may exercise all voting rights attached thereto except on a resolution to cancel any of the stock, and have waived their rights to receive dividends or to participate in the assets and property of the Company on a winding-up or dissolution of the Company.  For accounting purposes these shares will be recorded at their fair value when the performance measures are satisfied with a charge in an equivalent amount to compensation expense.

















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4.     Stockholders' Equity (Cont'd):

(b)     Stock options and stock-based compensation:

A summary of the status of the Company's stock options at September 30, 2005 and 2004 and changes during the periods ended on those dates is presented below:



|                                 | 2005      | 2004                           
|-------------------------------- | --------- | -------------------------------
|                                 | Options   | Weighted average
exercise price
|Outstanding, beginning of period | 1,860,000 | $                              
|Granted                          | 50,000    |                                
|Exercised                        | --        |                                
|Expired/cancelled                | (35,000)  |                                
|Expired/cancelled                | (460,000) |                                
|Outstanding, end of period       | 1,415,000 | $                              
|Options exercisable              | 1,146,665 | $                              

The fair value of the options granted during the period ended September 30, 2005 is estimated to be $8,318 ($0.17 per option).  The fair value has been calculated using the Black-Scholes option pricing model and the following factors: volatility - 90%; risk-free interest rate - 5%; dividend yield - nil; term - five years.

(c)     Warrants:

As at September 30, 2005, 7,567,835 warrants were outstanding and expire on January 18, 2007.  Each warrant is convertible into one common share and is exercisable at $0.50.  During the period 1,028,750 warrants expired on August 8, 2005.

(d)     Private Placement:

On January 19, 2005, the Company closed a private placement of 7,567,835 units at a price of $0.30 per unit for a total of $2,270,350. Each unit consisting of one (1) common share and one (1) share purchase warrant, each warrant entitling the holder to purchase one (1) additional common share at a price of US$0.50 per share on or before January 18, 2007.







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5.     Related Party Transactions:

In addition to related party transactions disclosed elsewhere in these financial statements:

(a)     During the three and nine month periods ended September 30, 2005, the Company paid or accrued, geological consulting fees to two directors as follows:



|     | 3 Months Ended September 30, | 9 Months Ended September 30, | 
|---- | ---------------------------- | ---------------------------- | 
|     |                              |                              | 
|2005 | $10,000                      | $73,464                      | 
|2004 | 35,800                       | 131,850                      | 

The consulting fees are in the normal course of operations and are recorded at their exchange amount which is the price agreed to between the Company and the directors.

(b)     The Company is charged by Pathway Capital Ltd. (Pathway), a company with one common directors, CAD $2,500 per month in consideration for which Pathway provides the Company with advisory services relating to general corporate development, financial matters, raising additional capital, strategic planning and other matters relating to the financial affairs of the Company.

Total fees paid or accrued to Pathway during the three-months ended September 30, 2005 were as follows:



|     | 3 Months Ended September 30, | 9 Months Ended September 30, | 
|---- | ---------------------------- | ---------------------------- | 
|     |                              |                              | 
|2005 | $6,321                       | $18,380                      | 
|2004 | 5,808                        | 16,953                       | 

In addition, Pathway charges the Company CAD $1,100 per month for rent and other administrative services on a cost recovery basis as follows:



|     | 3 Months Ended September 30, | 9 Months Ended September 30, | 
|---- | ---------------------------- | ---------------------------- | 
|     |                              |                              | 
|2005 | $12,290                      | $42,291                      | 
|2004 | NIL                          | NIL                          | 

6.     Financial Instruments and Risk Management:

(a)     Fair values:

The carrying amounts of cash and cash equivalents, amounts receivable and accounts payable and accrued liabilities approximate their fair values due to their ability for prompt liquidation or short-term to maturity.  The fair value of payables, including note payables, to related parties is not readily determinable due to the lack of a ready market for such indebtedness.



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6.     Financial Instruments and Risk Management (Cont'd):

(b)     Foreign currency risk:

Foreign currency risk is the risk to the Company's earnings that arises from fluctuations in foreign currency exchange rates, and the degree of volatility of these rates.  The Company does not yet have any sales, and accordingly, foreign exchange risk arises solely from the cash balances held in and costs incurred in China.

7.     Subsequent Event

The Company is currently incorporated under the corporate laws of Wyoming and is proposing to change it's jurisdiction of incorporation from Wyoming to the Canadian federal jurisdiction through a process known as a continuation.  A continuation is a process by which a corporation which is not incorporated under the laws of Canada may change its jurisdiction of incorporation to Canada.

The continuation will not result in any material effect on our operations. The business and operations of the Company following the continuation will be identical in most respects to our current business, except that we will no longer be subject to the corporate laws of the State of Wyoming but will be subject to the Canada Business Corporations Act.

8.     Comparative Figures

Certain comparative figures have been reclassified to conform to the current period's presentation.





















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ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Forward Looking Statements

This quarterly report contains certain forward-looking statements.  Much of the information included in this report includes or is based upon estimates, projections or other "forward looking statements".  Such forward-looking statements include any projections or estimates made by us and our management in connection with our business operations.  While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, prediction, projections, assumptions or other future performance suggested herein.

Such estimates, projections or other "forward looking statements" involve various risks and uncertainties as outlined below.  We caution the reader that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other "forward looking statements."

The following discussion should be read in conjunction with our historical Financial Statements and contained herein.

Critical Accounting Policies

Our discussion and analysis of its financial condition and results of operations, including the discussion on liquidity and capital resources, are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.  On an ongoing basis, management re-evaluates its estimates and judgments.

The going concern basis of presentation assumes we will continue in operation throughout the next fiscal year and into the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business.  Certain conditions, discussed below, currently exists which raise substantial doubt upon the validity of this assumption.  The financial statements do not include any adjustments that might result from the outcome of the uncertainty.

Our future operations are dependent upon our ability to obtain third party financing in the form of debt and equity and ultimately to generate future profitable operations or income from its investments.  As of September 30, 2005, we have not generated revenues, and have experienced negative cash flow from operations.  We may look to secure additional funds through future debt or equity financings.  Such financings may not be available or may not be available on reasonable terms.



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Overview

Our financial statements contained in this quarterly report have been prepared on a going concern basis, which assumes that we will be able to realize our assets and discharge our obligations in the normal course of business.  We incurred net losses from operations for the period ended September 30, 2005, for the period ended September 30, 2004 and for the period from the inception of our mining business as of January 20, 2003 to September 30, 2005 of $57,913, $235,839 and $2,198,489 respectively.  We did not earn any revenues during the period ended September 30, 2005 and the year ended December 31, 2004.

The exploration projects the Company is currently engaged in are as follows:

Blue Mountain Project

The Company entered into an agreement dated March 18, 2003 with Nassau Ltd. ("Nassau") an unrelated private U.S. company, to acquire 100% of the interest held by Nassau in a mining property located in Nevada, U.S.A.

In order to acquire the interest, the Company has entered into an option agreement with Nassau, pursuant to which agreement Nassau granted the Company the option to acquire a 100% interest in certain mining claims known as the Blue Mountain project which is made up of 31 mining claims and is located in Humboldt County, Nevada approximately 20 miles west of Winnemucca, Nevada (the "Blue Mountain Project").

In accordance with the terms of its agreement with Nassau, the Company has agreed that in order to acquire a 100% interest in the Blue Mountain Project, the Company will make the following payments and issue the following shares to Nassau:



|(i)   | 50,000 shares were issued on August 8, 2003 when the TSX Venture Exchange (the "TSX") approved (the "Approval Date") the Blue Mountain Project as a "qualifying property" (as defined within the rules and policies of the TSX);
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(ii)  | An additional 50,000 shares were issued on Aug 8, 2004;                                                                                                                                                                         
|(iii) | Two years following the Approval Date a payment in the amount of $20,000 (PAID);                                                                                                                                                
|(iv)  | Three years following the Approval Date a payment in the amount of $30,000                                                                                                                                                      
|(v)   | Four years following the Approval Date a payment in the amount of $40,000;                                                                                                                                                      
|(vi)  | Five years following the Approval Date a payment in the amount of $100,000; and                                                                                                                                                 
|(vii) | Six years following the Approval Date a payment in the amount of $1,300,000 (the "Final Payment").                                                                                                                              

Upon the Company making the Final Payment to Nassau then the Company will own 100% of the Blue Mountain Project subject only to a 2% net smelter royalty on gold (the "Royalty") and the Company will have the right to buy down the Royalty to a 1% NSR by paying Nassau the sum of $1,500,000 at any time prior to completion of the first year of production.  All payments are in U.S. dollars.



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Red Rock (formerly LS Property)

On March 4, 2004, the Company acquired an option on the Red Rock Property, and has the right to acquire a 100% interest, in these 80 mineral claims located in Lander County, Nevada, subject to a retained 3% net smelter royalty.  The Company made an initial $5,000 payment upon execution of the agreement dated February 27, 2004, and will, at the Company's option, make further cash payments totaling $1,400,000 over a 15 year period.

The schedule of payments and work commitments is as follows:



|Due Date                  | Cash Payment | Work Commitment
|------------------------- | ------------ | ---------------
|On execution of Agreement | $            | 5,000 (PAID)   
|By Yr. 1 Anniversary      | $            | 15,000 (PAID)  
|By Yr. 2 Anniversary      | $            | 25,000         
|By Yr. 3 Anniversary      | $            | 50,000         
|By Yr. 4 Anniversary      | $            | 155,000        
|By Yr. 5 Anniversary      | $            | 250,000        
|By Yr. 6 Anniversary      | $            | 250,000        
|By Yr. 7 Anniversary      | $            | 250,000        
|Each of Yrs. 8 to 15      | $            | 50,000         
|TOTAL                     | $            | 1,400,000      

On September 12, 2005 the Company signed a letter of intent with Centerra (U.S.) Inc. (Centerra) in which Centerra can acquire up to an undivided 60% interest in the property with the Company and can subsequently acquire up to an additional 15% in the property.  Under the terms of the proposed agreement, Centerra has agreed to spend a total of $1,900,000 over a 6 year period to acquire an undivided 60% interest in the property at which time Centerra will have the option to spend a further $3,100,000 over a 4 year period for an additional undivided 15% in the property.

Dongchuan Project

On June 2, 2004, we entered into a formal co-operative agreement with Yunnan Nonferrous Mining and Geology Ltd. ("YNMG") pursuant to which we together agreed to establish a Sino-Foreign co-operative joint venture company in the Yunnan Province, PRC. The joint venture company is called the Xinan Mineral Resources Co. Ltd.  It was established for the purpose of jointly exploring and, if successful, mining any viable deposits discovered in the Dongchuan area of the Yunnan, Province, PRC.

Pursuant to the terms of the co-operative agreement, we agreed to invest, at our option, a total of US$3.1 million over three years to earn a 70% interest in the co-operative company.  After a 70% interest is earned, at our option, we could earn a further 20 % interest in the co-operative company by investing an additional US$6 million.

In 2005 the Company reached an agreement with its joint venture partner and received government approval to terminate the co-operative agreement on its Dongchuan project.  All unexpended amounts paid to the co-operative company will be returned to the Company and all rights to the property will be returned to Yunnan Nonferrous Mining and Geology Ltd.  Before the unexpended amounts are returned, the Company has agreed to pay a termination fee of approximately $24,000.



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Gongguo Project

On May 18, 2004 we entered into a formal co-operative agreement with Yunnan Nonferrous Mining and Geology Ltd. ("YNMG") pursuant to which we together agreed to establish a Sino-Foreign co-operative joint venture company in Yunnan Province, PRC.

The joint venture company is called the Xinlong Mineral Resources Co. Ltd.  It was established for the purpose of jointly exploring and, if successful, mining any viable deposits discovered in the Gongguo area of the Yunnan, Province, PRC.

Pursuant to the terms of the co-operative agreement, we have agreed to invest, at our option, a total of US$3.05 million over three years to earn an 80% interest in the co-operative company.  After an 80% interest is earned, contributions to the co-operative company were to be made pro rata, provided that YNMG's interest can be diluted to not less than 10% if it elects not to make cash contributions.

In 2005 the Company reached an agreement with its joint venture partner and received government approval to terminate the co-operative agreement on its Gongguo project.  All unexpended amounts paid to the co-operative company will be returned to the Company and all rights to the property will be returned to Yunnan Nonferrous Mining and Geology Ltd.  Before the unexpended amounts are returned, the Company has agreed to pay a termination fee of approximately $24,000.

Our Proposed Exploration Program



We must conduct exploration to determine what amounts of minerals exist on our properties and if such minerals can be economically extracted and profitably processed.

Our exploration program is designed to efficiently explore and evaluate our properties.

We do not claim to have any mineral reserves whatsoever at this time on our properties.

Our anticipated exploration costs over the next twelve months consists of $50,000 on our Blue Mountain property.  We anticipate Centerra spending a further $100,000 during the next twelve months, on exploring the Red Rock property, towards earning an interest in the property.

Government Regulation

Mining operations and exploration activities are subject to various national, state, and local laws and regulations in the United States, which govern prospecting, development, mining, production, exports, taxes, labour standards, occupational health, waste disposal, protection of the environment, mine safety, hazardous substances and other matters.  We believe that we are in compliance in all material respects with applicable mining, health, safety and environmental statutes and the regulations passed thereunder in the United States.



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Environmental Regulation

Our mining operations and exploration activities are subject to various federal, state and local laws and regulations governing protection of the environment.  These laws are continually changing and, as a general matter, are becoming more restrictive.  Our policy is to conduct business in a way that safeguards public health and the environment.  We believe that our operations are conducted in material compliance with applicable laws and regulations.

Changes to current local, state or federal laws and regulations in the jurisdictions where we operate could require additional capital expenditures and increased operating and/or reclamation costs.  Although we are unable to predict what additional legislation, if any, might be proposed or enacted, additional regulatory requirements could render certain mining operations uneconomic.

Competition

We compete with other mining companies in connection with the acquisition of gold and other precious metals properties.  There is competition for the limited number of gold acquisition opportunities, some of which is with other companies having substantially greater financial resources than we do.  As a result, we may have difficulty acquiring attractive gold mining/exploration properties.

We believe no single company has sufficient market power to affect the price or supply of gold in the world market.

Results of Operations

We have included in this quarterly report, financial statements for the periods ended September 30, 2005 and 2004, and the period from January 20, 2003 (being the date of inception of our new business) to September 30, 2005.

Three-month period ended September 30, 2005

We incurred a net loss of $57,913 for the three-month period ended September 30, 2005, resulting in a loss per share of $0.00.  The loss was attributable to operating expenses of $3,810 and a foreign exchange loss of $58,096 offset by interest income of $3,992.

During the period we incurred exploration expenses of $44,293 and a recovery from our Chinese joint ventures of $152,169.  We also incurred $3,775 in business development expenses, $12,137 in consulting fees, $808 in depreciation and amortization, $1,737 in filing fees, $8,500 in general and administrative expenses, $6,321 in management fees, $40,878 in professional fees, $2,796 in rent, $14,642 in travel expenses and $19,523 in wages and benefits.

During the quarter we terminated our Chinese joint ventures which resulted in a recovery of previous expenses of $152,169 due to ownership increases to 100% from 70% and 80% for Dongchuan and Gongguo projects respectively.  Accordingly the Company is entitled to receive all the assets from its inactive joint ventures after a termination fee is paid to our joint venture partners.  The Company spent $44,293 on exploration compared to $22,421 in the previous year's quarter's period.  Exploration



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expenses consist of geologist fees, previously paid through our joint ventures, as we concluded our projects in China.  Exploration fees also included claim fees for our Blue Mountain which were $26,149 for the quarter.  Professional fees were approximately equal to the prior period due to legal work involved in redomiciling the Company back to Canada from Wyoming during the current quarter and professional fees relating to work establishing our Chinese joint ventures in the previous quarter.  Business development relates to expenses incurred analyzing property opportunities and, in the prior year, included expenses establishing business contacts in China.  We had started to focus our efforts on our projects in China during the prior year's quarter and, accordingly, our business development expenses decreased from the absence of China related activities.  Consulting expense relates to contracted geologist fees, including fees to a director of the company.  Consulting fees decreased compared to the prior quarter as the services of the geologist who was responsible for sourcing and managing our projects in China was paid only for one month of services compared with payments for three months of services in the previous quarter.  Travel expenses decreased as travel to China during the prior period's quarter did not occur in the current quarter.  Wages and benefits remained approximately equal compared to the prior year's quarter as the new Chief Executive Officer hired by the company was employed for the entire quarter for both years.  Management fees were constant as the monthly charge is approximately $2,000 per month.

Three-month period ended September 30, 2004

We incurred a net loss of $235,839 for the quarter ended September 30, 2004, resulting in a loss per share of $0.02.  The loss was attributable to operating expense of $223,077 and foreign exchange loss of $12,762.

During the quarter we incurred $7,489 in Business Development, $528 in depreciation and amortization, $37,417 in consulting fees, $13,774 in equity in operations of joint ventures, $22,421 in exploration expense, $3,127 in filing fees, $8,561 in general and administrative expenses, $5,808 in management fees, $37,938 in professional fees, $10,960 in rent, and $40,197 in travel and conference.

Business development relates to expense incurred in establishing business contacts in China.  Consulting fees increased as we accrued fees to a director for his work on an SB-2 registration with the SEC.  Exploration expense decreased as we focused our efforts on acquiring the China properties.  The majority of the exploration expense relates to work performed on the Blue Mountain Property.  This work included mapping, sampling, data compilation and claims fees.  Exploration expense also includes costs related to area reconnaissance work.  The exploration expenses related to Blue Mountain was as follows: $2,156 in geologist fees and $20,515 in staking fees. General and administrative expense increased due to increased activities associated with acquiring new properties in China.  Management fees were constant as the monthly charge is approximately $1,675 per month. Professional fees increased as we incurred legal fees to draft the agreements in China and also to file an SB-2 registration statement with the SEC.  Travel fees increased due to travel to, and within China.

Nine-month period ended September 30, 2005

We incurred a net loss of $656,057 for the nine-month period ended September 30, 2005, resulting in a loss per share of $0.03.  The loss was attributable to operating expenses of $638,704, interest expense of $1,733 and a foreign exchange loss of $21,154 which was offset by interest income of $5,533.



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During the period we incurred $25,910 in business development expenses, $2,350 in depreciation and amortization, $82,424 in consulting fees, $192,460 in exploration expense, $26,136 in filing fees, $30,250 in general and administrative expenses, $18,380 in management fees, $3,140 in marketing and promotion expenses, $126,984 in professional fees, $8,986 in rent, $50,993 in travel and conference and $68,551 in wages and benefits.

Expenses remained approximately equal compared to the prior year's period as we ceased our projects in China and starting the process of winding up our joint ventures.  Exploration expenses, not including our joint venture loss, relate to geologist fees and assay costs as we concluded our projects in China. These expenses were previously paid through our joint ventures.  Also included are exploration expenses relating to work performed on our Red Rock and Blue Mountain properties.  This work included mapping, sampling, data compilation, claims fees and also includes costs related to area reconnaissance work.  The exploration expenses related to Red Rock were as follows: $7,014 in geologist fees, $2,217 in analysis, $3,756 in supplies, travel and transportation and $18,257 in staking and claim fees.  The exploration expenses related to Blue Mountain consisted of $26,149 in claims fees.  Business development relates to expenses incurred reviewing property opportunities and establishing business contacts in China during the first two quarters of our fiscal year.  Business development increased over the prior period as we had just started to focus our efforts on our projects in China a year ago.  Consulting expense relates to contracted geologist fees, including a director of the company, to perform certain exploration activities.  Consulting fees decreased compared to the prior quarter as we retained the service of Mr. Lee, who was responsible for sourcing and managing our projects in China.  We agreed to compensate Mr. Lee retro-active to November 2003 as this is when he began his efforts to acquire properties in China.  Professional fees increased primarily due to legal work involved in redomiciling the Company back to Canada from Wyoming.   Travel expenses decreased as several directors spent time traveling in China during the prior period's quarter and the Company agreed reimburse Mr. Lee for travel expenses in China retro-active to November 2003.  Wages and benefits also increased over the prior year's quarter as the company hired a new Chief Executive Officer who joined the company in late June 2004.  Management fees were constant as the monthly charge is approximately $2,000 per month.

Nine-month period ended September 30, 2004

We incurred a net loss of $653,711 for the nine-month period ended September 30, 2004, resulting in a loss per share of $0.05.  The loss was attributable to operating expenses of $635,367, and foreign exchange loss of $18,344.

During the period we incurred $7,489 in business development, $1,104 in depreciation and amortization, $144,390 in consulting fees, $13,774 in equity in operations of joint ventures, $113,178 in exploration expense, $10,774 in filing fees, $28,507 in general and administrative expenses, $16,953 in management fees, and $99,301 in professional fees, $25,439 in rent, $1,075 in organization expense and $128,491 in travel and conference.

Expenses increased over the prior year period due to the increased activities as we enter the mining business.  Business development relates to expenses incurred in establishing business contacts in China.  Consulting fees increased as we contracted several geologists, including a director, to



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perform certain exploration activities.  We also retained the services of director Mr. Lee.  We agreed to compensate Mr. Lee retro-active to November 2003 as this is when he began his efforts to acquire properties in China.  Mr. Lee will be focused on property generation as well as assisting in exploration.  We have also accrued consulting fees for work performed on an SB-2 registration with the SEC. The majority of the exploration expense related to work performed on our Blue Mountain Property.  This work included mapping, sampling, data compilation and claims fees.  Also included in exploration expense are staking fees on the NBM and LS Properties (see our 2003 10KSB for further information on the properties), which were acquired during the nine-month period ended September 30, 2004.  Exploration expense also includes costs related to area reconnaissance work.  The exploration expenses related to Blue Mountain was as follows: $51,750 in geologist fees and $48,880 in staking fees.  Management fees were constant as the monthly charge is approximately $1,675 per month.  Professional fees increased as we incurred legal fees in preparing an SB-2 registration statement, as well as to draft the joint-venture agreements in China.  Travel fees increased due to travel to, and within China.

Period of inception of the mining business, January 20, 2003 to September 30, 2005

We incurred a net loss of $2,198,489 for the period of inception to September 30, 2005, resulting in a loss per share of $0.14.  The loss was attributable to operating expenses of $2,146,526 and interest expense of $1,733 which was offset by a foreign exchange loss of $55,763 and interest income of $5,533.

Balance Sheets

Total cash and cash equivalents as at September 30, 2005 and December 31, 2004, were respectively, $638,749 and $1,497,859.  Working capital as at September 30, 2005, and December 31, 2004, were respectively, $1,102,776 and $826,605.

The increase in working capital between September 30, 2005 and December 31, 2004 was primarily attributable to the closing of the private placement in the amount of $2,270,350.  A total of $1,639,065 of the private placement had already been collected at December 31, 2004 and was recognized as subscriptions received in advance of share offering.  No revenue was generated during the period.

Total share capital as at September 30, 2005 and December 31, 2004, was respectively, $7,899,276 and $5,628,926.  Total shares outstanding as at September 30, 2005 and December 31, 2004, were respectively, 24,572,700 and 17,004,865.

Current Capital Resources and Liquidity

Our capital resources have been limited.  We currently do not, and will not, generate revenue from business operations in the foreseeable future, and to date have relied on the sale of equity and related party loans for cash required for our operations.  There can be no assurances that any outstanding share purchase warrants will be exercised.

On January 19, 2005, we closed a private placement of 7,567,835 units at a price of $0.30 per unit for total proceeds of $2,270,350.  There can be no assurances that we can obtain future additional financing on terms reasonably acceptable to us or at all.  The lack of capital may force us to curtail our operating activities and potential investment activities.



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During 2004, we entered into leasing agreements with respect to office and equipment leases expiring in January 2007.  Arrangement has been made for Pathway Capital Ltd., a related party to manage and assume payment of these leases.  The company will reimburse Pathway based on estimated usage of office space and other equipments on a cost recovery basis.  The balance of the 2005 lease obligation for the office space is estimated to be $4,292.

ITEM 3.     CONTROLS AND PROCEDURES

(a) 	Evaluation of Disclosure Controls and Procedures:  Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time period 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 the reports filed under the Exchange Act is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Company's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based upon and as of the date of that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed in the reports the Company files and submits under the Exchange Act is recorded, processed, summarized and reported as and when required.

(b) 	Changes in Internal Control over Financial Reporting:  There were no changes in the Company's internal control over financial reporting identified in connection with the Company evaluation described above during the Company's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.









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PART II - OTHER INFORMATION

ITEM 2.     CHANGES IN SECURITIES AND USE OF PROCEEDS.

On January 19, 2005, we completed our public offering and sold 7,567,835 shares of common stock and raised $2,270,350. There was no underwriter involved in our public offering. The proceeds from the offering were partially used during the quarter ended September 30, 2005 to cover exploration and working capital expenses.  The amount of proceeds used decreased compared to the prior quarter as the ownership in both our joint ventures increased to 100% from 70% and 80% for Dongchuan and Gongguo respectively.

The following amounts were paid from the proceeds of the offering:



|Exploration expenses | $ | 403,613  
|-------------------- | - | ---------
|Working capital      |   | 632,166  
|Total                | $ | 1,035,779

In previous the previous quarter we also used the proceeds from the offering to pay loans to related parties, who financed the Company's exploration expenses during the period prior to the offering.   The proceeds remaining are available to cover future exploration and working capital expenses of the Company.

ITEM 6.     EXHIBITS



| | Exhibits | Item Description                                                                                                                                               
| | -------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 31.1     | Certification of Principal Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.
| | 31.2     | Certification of Principal Financial Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.
| | 32.1     | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer).              
| | 32.2     | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer).              







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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date this 14th day of November, 2005.



| | LUNA GOLD CORP.
| | ---------------
| |                
| | By:            
| |                
| |                
| | By:            
| |                

















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