**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      DC 20549





**FORM
      10-QSB**





[X]
            Quarterly
                Report pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934For
                the quarterly period endedMarch
                31, 2007[
                ]
            Transition
                Report pursuant to 13 or 15(d) of the Securities Exchange Act of
                1934For
                the transition period __________to__________Commission
                File Number:000-51013





Colombia
      Goldfields Ltd.


(Exact
      name of small business issuer as specified in its charter)





Delaware
            76-0730088(State
                or other jurisdiction of incorporation or
                organization)
            (IRS
                Employer Identification No.)




#208-8
                King Street East, Toronto, Ontario, Canada M5C 1B5(Address
                of principal executive offices)





416-203-3856(Issuer’s
                telephone number)_______________________________________________________________(Former
                name, former address and former fiscal year, if changed since last
                report)





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
      (or
      for such shorter period that the issuer was required to file such reports),
      and
      (2) has been subject to such filing requirements for the past 90 days [X] Yes
      [
      ] No





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





State
      the
      number of shares outstanding of each of the issuer’s classes of common stock, as
      of the latest practicable date: 65,706,849 common shares as of April 30,
      2007.





Transitional
      Small Business Disclosure Format (check one): Yes [ ] No [X]




Table
          of Contents


TABLE
                OF CONTENTS
            PagePART
                I - FINANCIAL INFORMATIONItem
                1.
            Financial
                Statements
            3Item
                2.
            Plan
                of Operation
            4Item
                3.
            Controls
                and Procedures
            24PART
                II - OTHER INFORMATIONItem
                1.
            Legal
                Proceedings
            26Item
                2.
            Unregistered
                Sales of Equity Securities and Use of
                Proceeds
            26Item
                3.
            Defaults
                Upon Senior Securities
            27Item
                4.
            Submission
                of Matters to a Vote of Security
                Holders
            27Item
                5.
            Other
                Information
            27Item
                6.
            Exhibits
            27


2
 Table
          of Contents


**PART
      I - FINANCIAL INFORMATION**





**Item1.**  **Financial
      Statements**





Our
                unauditedconsolidated
                financial statements included in this Form 10-QSB are as
                follows:F-1
            Interim
                Consolidated Balance Sheet as of March 31, 2007
                (unaudited);F-2
            Interim
                ConsolidatedStatements
                of Operations for the three months ended March 31, 2007 and 2006
                and from
                inception (March 25, 2003) through March 31, 2007 (unaudited);F-3
            Interim
                Consolidated Statements of Stockholders’ Equity
                (Deficiency) for the period from inception (March 25, 2003) through
                March
                31, 2007 (unaudited);F-6
            Interim
                Consolidated Statements of Cash Flows for the three
                months ended March 31, 2007 and 2006 and from inception (March 25,
                2003)
                through March 31, 2007 (unaudited);F-7
            Notes
                to Interim Consolidated Financial
                Statements;








These
      unaudited interim consolidated financial statements have been prepared in
      accordance with accounting principles generally accepted in the United States
      of
      America for interim financial information and the SEC instructions to Form
      10-QSB. In the opinion of management, all adjustments considered necessary
      for a
      fair presentation have been included. Operating results for the interim period
      ended March 31, 2007 are not necessarily indicative of the results that can
      be
      expected for the full year.


3
 Table
          of Contents


**COLOMBIAGOLDFIELDS
      LTD.**


**(An
      Exploration Stage Company)**


**INTERIM
      CONSOLIDATED BALANCE SHEETS**




*US
                Dollars*
            **March
                  31, 2007**
                **(unaudited)**
            
            **December
                  31,**
                **2006****ASSETS****Current**Cash
                and cash equivalents
            $
            3,941,968
            
            $
            882,913Prepaid
                expenses and deposits
            
            368,628
            
            
            176,347Prepaid
                consulting fees (Note 5)
            
            485,000
            
            
            -4,795,596
            
            
            1,059,260Mineral
                and exploration properties and rights (Note 3)
            
            47,268,969
            
            
            43,528,386Property
                and equipment, net of accumulated amortization (Note 4)
            
            415,299
            
            
            419,733Prepaid
                consulting fees (Note 5)
            
            228,750
            
            
            -$
            52,708,614
            
            $
            45,007,379**LIABILITIES****Current**Accounts
                payable and accrued liabilities (Note 6)
            $
            6,908,945
            
            $
            6,037,671**Non
                Current**Deferred
                income tax liability (Notes 3 and 7)
            
            9,334,814
            
            
            9,759,52416,243,759
            
            
            15,797,195**STOCKHOLDERS’
                EQUITY****Common
                stock (Note 5)**Authorized:
                200,000,000
                  common shares, $0.00001 par value
            
            661
            
            
            565Issued
                  and Outstanding:
                65,706,849
                  common shares (December 31, 2006, 56,039,849common
                  shares)**Additional
                paid-in capital (Note 5)**
            
            46,797,272
            
            
            37,039,26646,797,933
            
            
            37,039,831**Deficit
                accumulated during the exploration stage**
            
            (10,333,078)
            
            
            (7,829,647)36,464,855
            
            
            29,210,184$
            52,708,614
            
            $
            45,007,379




**See
      accompanying Notes to Consolidated Financial Statements**


F-1
 Table
            of Contents


**COLOMBIAGOLDFIELDS
        LTD.**
 **(An
        Exploration Stage Company)**
 **INTERIM
        CONSOLIDATED STATEMENTS OF OPERATIONS**




*US
                Dollars*
            **Three**
                  **Months**
                  **Ended**
                  **March
                    31, 2007**
                  **(unaudited)**
            
            **Three**
                      **Months**
                      **Ended**
                      **March
                        31, 2006**
                      **(unaudited)**
            
            **Cumulative**
                      **from
                        Inception**
                      **(March
                        25, 2003)**
                      **through**
                      **March
                        31, 2007**
                      **(unaudited)****REVENUES**
            $
            -
            
            $
            -
            
            $
            -**OPERATING
                EXPENSES**Mineral
                property exploration expenses (Notes 3 and 5)
            
            1,472,016
            
            
            572,623
            
            
            5,949,752General
                and administrative (Note 5)
            
            1,447,040
            
            
            758,724
            
            
            5,787,657Amortization
            
            18,814
            
            
            5,444
            
            
            86,919Total
                operating expenses
            
            2,937,870
            
            
            1,336,791
            
            
            11,824,328Other
                income
            
            (9,729)
            
            
            (3,552)
            
            
            (127,763)Loss
                from continuing operations
            
            (2,928,141)
            
            
            (1,333,239)
            
            
            (11,696,565)Income
                from discontinued operations (Note 1)
            
            -
            
            
            -
            
            
            9,827Loss
                before deferred income taxes
            
            (2,928,141)
            
            
            (1,333,239)
            
            
            (11,686,738)Deferred
                income tax recovery (Note 7)
            
            (424,710)
            
            
            -
            
            
            (1,353,660)**NET
                LOSS**
            $
            (2,503,431)
            
            $
            (1,333,239)
            
            $
            (10,333,078)**LOSS
                PER SHARE - BASIC AND DILUTED**
            $
            (0.04)
            
            $
            (0.04)**WEIGHTED
                AVERAGE****NUMBER
                OF COMMON****SHARES
                OUTSTANDING**Basic
                and diluted
            
            57,211,516
            
            
            32,395,377




**See
      accompanying Notes to Consolidated Financial Statements**


F-2
 Table
          of Contents


**COLOMBIAGOLDFIELDS
      LTD.**


**(An
      Exploration Stage Company)**


**INTERIM
      CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIENCY)**




*US
                Dollars*
            Common
              Shares
            
            Stock
              Amount
            
            Additional
              Paid-in
              Capital
            
            Share
                Subscriptions
              Received
            
            Deficit
              Accumulated
                During
              The
              Exploration
              Stage
            
            Total
              Stockholders’
                Equity
              (Deficiency)**Period
                Ended December 31, 2003 (see Note 1):**Issue
                of common stock for cashat
                $0.000125 per share onMarch
                25, 2003
            
            8
            
            $
            -
            
            $
            1
            
            $
            -
            
            $
            -
            
            $
            1Issue
                of common stock for cashat
                $0.000125 per share onMay
                5, 2003
            
            16,000,000
            
            
            160
            
            
            1,840
            
            
            -
            
            
            -
            
            
            2,000Repurchase
                of common stock for cash at $0.000125per
                share on October 31, 2003
            
            (8,000,008)
            
            
            (80)
            
            
            (920)
            
            
            -
            
            
            -
            
            
            (1,000)Donated
                Capital
            
            -
            
            
            -
            
            
            35,200
            
            
            -
            
            
            -
            
            
            35,200Net
                loss for the twelve months ended December 31, 2003
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (36,399)
            
            
            (36,399)Balance,
                December 31, 2003
            
            8,000,000
            
            
            80
            
            
            36,121
            
            
            -
            
            
            (36,399)
            
            
            (198)**Year
                Ended December 31, 2004:**Issue
                of common stock forcash
                at $0.00625 per shareon
                December 20, 2004
            
            16,000,000
            
            
            160
            
            
            99,840
            
            
            -
            
            
            -
            
            
            100,000Donated
                Capital
            
            -
            
            
            -
            
            
            19,200
            
            
            -
            
            
            -
            
            
            19,200Net
                loss for the twelve months ended December 31, 2004
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (23,094)
            
            
            (23,094)Balance
                December 31, 2004
            
            24,000,000
            
            
            240
            
            
            155,161
            
            
            -
            
            
            (59,493)
            
            
            95,908**Year
                Ended December 31, 2005:**Issue
                of common stock for mineral concession at $0.25 per share on September
                22,
                2005
            
            1,000,000
            
            
            10
            
            
            249,990
            
            
            -
            
            
            -
            
            
            250,000Issue
                of 4,221,000 common stock for cash at $0.25 per share and 368,100
                common
                stock for finder fee on October 14, 2005
            
            4,589,100
            
            
            46
            
            
            1,055,204
            
            
            -
            
            
            -
            
            
            1,055,250Forgiveness
                of advances from a related party
            
            
            
            
            
            
            
            4,999
            
            
            -
            
            
            -
            
            
            4,999Share
                Subscriptions Received
            
            -
            
            
            -
            
            
            -
            
            
            1,767,650
            
            
            -
            
            
            1,767,650Net
                loss for the twelve months ended December 31, 2005
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (1,491,470)
            
            
            (1,491,470)Balance,
                December 31, 2005
            
            29,589,100
            
            $
            296
            
            $
            1,465,354
            
            $
            1,767,650
            
            $
            (1,550,963)
            
            $
            1,682,337





**See
      accompanying Notes to Consolidated Financial Statements**


F-3
 Table
          of Contents


**COLOMBIA
        GOLDFIELDS LTD.**
 **(An
        Exploration Stage Company)**
 **INTERIM
        CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIENCY)** 
  *US
                    Dollars*
                Common
                  Shares
                
                Stock
                  Amount
                
                Additional
                  Paid-in
                  Capital
                
                Share
                    Subscriptions
                  Received
                
                Deficit
                  Accumulated
                    During
                  The
                  Exploration
                  Stage
                
                Total
                  Stockholders’
                    Equity
                  (Deficiency)Balance,
                    December 31, 2005
                
                29,589,100
                
                $
                296
                
                $
                1,465,354
                
                $
                1,767,650
                
                $
                (1,550,963)
                $
                1,682,337**Year
                  Ended December 31, 2006:**Issue
                    of common stock for cash at $0.60 per share on January 24, 2006,net
                    of $187,565 finders fee
                
                3,126,083
                
                
                31
                
                
                1,688,054
                
                
                (1,767,650)
                
                
                -
                
                (79,565)Issue
                  of common stock forMineral
                  concessions at $1.90 per share on February 14, 2006
                
                1,000,000
                
                
                10
                
                
                1,899,990
                
                
                -
                
                
                -
                
                1,900,000Issue
                  of common stockFor
                  Mineral concession at$2.25
                  per share on April 10, 2006
                
                1,000,000
                
                
                10
                
                
                2,249,990
                
                
                -
                
                
                -
                
                2,250,000Issue
                  of common stockfor
                  cash at $1.50 per unit (common shares & warrants less finders fee of
                  $585,060 on April 26, 2006
                
                6,500,666
                
                
                65
                
                
                6,416,112
                
                
                -
                
                
                -
                
                6,416,177Issue
                  of share purchase warrants withApril
                  26, 2006 common stockissuance
                
                -
                
                
                -
                
                
                2,749,762
                
                
                -
                
                
                -
                
                2,749,762Issue
                  of common stock forMineral
                  concessions of $2.74per
                  share on April 28, 2006
                
                2,000,000
                
                
                20
                
                
                5,479,980
                
                
                -
                
                
                -
                
                5,480,000Issue
                  of common stock for Mineral concessions at $1.10 per share on August
                  22,
                  2006
                
                4,200,000
                
                
                42
                
                
                4,619,958
                
                
                **-**
                
                
                **-**
                
                4,620,000Issue
                  of common stock for Mineral concessions at $1.41 per share on September
                  25, 2006
                
                1,150,000
                
                
                16
                
                
                1,621,484
                
                
                -
                
                
                -
                
                1,621,500Issue
                  of common shares per exercise of 3,471,000 warrants on October
                  14,
                  2006.
                
                3,471,000
                
                
                35
                
                
                1,735,465
                
                
                -
                
                
                -
                
                1,735,500Issue
                  of common stock for Mineral concessions at $1.28 per share on December
                  14,
                  2006.
                
                4,000,000
                
                
                40
                
                
                5,119,960
                
                
                **-**
                
                
                **-**
                
                5,120,000Stock
                  based compensation
                
                -
                
                
                -
                
                
                1,993,157
                
                
                **-**
                
                
                **-**
                
                1,993,157Net
                  loss for the twelve months ended December 31,
                  2006
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (6,278,684)
                
                (6,278,684)Balance
                  December 31,
                  2006
                
                56,036,849
                
                $
                565
                
                $
                37,039,266
                
                $
                -
                
                $
                (7,829,647)
                $
                29,210,184


**See
      accompanying Notes to Consolidated Financial Statements**


F-4
 Table
          of Contents


**COLOMBIA
        GOLDFIELDS LTD.**
 **(An
        Exploration Stage Company)**
 **INTERIM
        CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIENCY)**




*US
              Dollars*
            
            Common
              Shares
            
            
            Stock
              Amount
            
            
            Additional
              Paid-in
              Capital
            
            
            Share
              Subscriptions
              Received
            
            
            Deficit
              Accumulated
              During
              The
              Exploration
              Stage
            
            
            Total
              Stockholders’
              Equity
              (Deficiency)Balance,
              December 31, 2006
            
            56,036,849
            
            $
            565
            
            $
            37,039,266
            
            $
            -
            
            $
            (7,829,647)
            
            $
            29,210,184**Three
              Months Ended March 31, 2007:**Issue
                of common stockfor
                cash at $1.00 per share less agents fee of $541,200
              on
                March 21, 2007
            
            9,020,000
            
            
            90
            
            
            8,074,434
            
            
            -
            
            
            -
            
            
            8,074,524Issue
              of agents’ warrants in connection with March 21, 2007 common stock
              issuance
            
            
            
            
            
            
            
            404,276
            
            
            -
            
            
            -
            
            
            404,276Issue
              of common stock for consulting services
            
            650,000
            
            
            6
            
            
            967,119
            
            
            **-**
            
            
            **-**
            
            
            967,125Stock
                based compensation - stock options
            
            -
            
            
            -
            
            
            312,177
            
            
            **-**
            
            
            **-**
            
            
            312,177Net
                loss for the three months ended March 31, 2007
            
            
            
            
            
            
            
            -
            
            
            -
            
            
            (2,503,431)
            
            
            (2,503,431)Balance
                March 31, 2007
            
            65,706,849
            
            $
            661
            
            $
            46,797,272
            
            $
            -
            
            $
            (10,333,078)
            
            $
            36,464,855





**See
      accompanying Notes to Consolidated Financial Statements**


F-5
 Table
          of Contents


**COLOMBIAGOLDFIELDS
        LTD.**
 **(An
        Exploration Stage Company)**
 **INTERIM
        CONSOLIDATED STATEMENTS OF CASH FLOWS**




**Three**
                        **Months**
                        **Ended**
                        **March
                          31, 2007**
                        **(unaudited)**
            
            **Three**
                        **Months**
                        **Ended**
                        **March
                          31, 2006**
                        **(unaudited)**
            
            **Cumulative**
                        **Inception**
                        **(March
                          25, 2003)**
                        **through**
                        **March
                          31, 2007**
                        **(unaudited)****OPERATING
                ACTIVITIES:**Net
                loss
            $
            (2,503,431)
            
            $
            (1,333,239)
            
            $
            (10,333,078)Items
                not requiring cash outlay:-
                Consulting fees
            
            -
            
            
            -
            
            
            52,400-
                Amortization
            
            18,814
            
            
            5,444
            
            
            88,919-
                Mineral property exploration
            
            -
            
            
            -
            
            
            250,000-
                Stock based compensation
            
            565,552
            
            
            486,489
            
            
            2,558,709-
                Deferred income taxes
            
            (424,710)
            
            
            -
            
            
            (1,353,660)Changes
                in non-cash working capital items-
                Accounts receivable
            
            -
            
            
            -
            
            
            --
                Prepaid expenses and deposits
            
            (192,281)
            
            
            14,149
            
            
            (368,628)-
                Exploration expenditure advances
            
            -
            
            
            (53,659)
            
            
            --
                Accounts payable and accrued liabilities
            
            710,501
            
            
            10,586
            
            
            1,138,634-
                Due to/from related parties
            
            -
            
            
            335,516
            
            
            4,999Net
                cash used in operating activities
            
            (1,825,555)
            
            
            (534,714)
            
            
            (7,961,705)**FINANCING
                ACTIVITIES:**Issuance
                of securities, net of finder fees
            
            8,478,800
            
            
            (79,565)
            
            
            22,224,575Issuance
                of bridge loan
            
            3,700,000
            
            
            -
            
            
            3,700,000Repayment
                of bridge loan
            
            (3,700,000)
            
            
            -
            
            
            (3,700,000)Net
                cash provided by (used in) financing activities
            
            8,478,800
            
            
            (79,565)
            
            
            22,224,575**INVESTING
                ACTIVITIES:**Purchase
                of mineral exploration rights
            
            (3,579,810)
            
            
            (254,400)
            
            
            (9,818,684)Purchase
                of equipment
            
            (14,380)
            
            
            (38,538)
            
            
            (481,218)Website
                development costs
            
            -
            
            
            (15,000)
            
            
            (21,000)Net
                cash used in investing activities
            
            (3,594,190)
            
            
            (307,938)
            
            
            (10,320,902)**INCREASE
                (DECREASE) IN CASH**
            $
            3,059,055
            
            $
            (922,217)
            
            $
            3,941,968**CASH
                AND CASH EQUIVALENTS AT BEGINNING OF PERIOD**
            
            882,913
            
            
            1,565,640
            
            
            -**CASH
                AND CASH EQUIVALENTS AT END OF PERIOD**
            $
            3,941,968
            
            $
            643,423
            
            $
            3,941,968**SUPPLEMENTAL
                CASH FLOW INFORMATION**Interest
                and financing fees- bridge loan
            $
            230,911
            
            $
            -
            
            $
            230,911Taxes
            $
            -
            
            $
            -
            
            $
            -





**See
      accompanying Notes to Consolidated Financial Statements**


F-6
 Table
          of Contents


**COLOMBIAGOLDFIELDS
        LTD.**
 **(An
        Exploration Stage Company)**
 **NOTES
        TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      1 - GOING CONCERN AND NATURE OF OPERATIONS**




The
      Company was incorporated under the laws of the State of Nevada, U.S.A., on
      March
      25, 2003. The Company changed its name from Secure Automated Enterprises, Inc.
      to Colombia Goldfields Ltd. on May 13, 2005. The Company changed its operational
      focus from providing electronic filings services for public access document
      submissions to the U.S. Securities Exchange Commission, to acquisition of,
      exploration for, and development of mineral properties. The Company is currently
      in the exploration stage. On July 31, 2006, the Company’s jurisdiction of
      incorporation was changed to the state of Delaware.




In
      the
      first quarter of 2005, the Company discontinued its electronic filings services
      operations and historical income and expenses relating to these discontinued
      operations have been classified as discontinued operations in the Statements
      of
      Operations for all comparative periods presented.




The
      Company has incurred a cumulative net loss since inception on March 25, 2003
      to
      March 31, 2007 of $10,333,078 and has no source of operating revenue. The
      Company’s ability to meet its obligations and continue as a going concern is
      dependent on the ability to identify and complete future funding. While the
      Company has been successful in raising financing to date, there can be no
      assurance that it will be able to do so in the future.





These
      consolidated financial statements have been prepared using U.S generally
      accepted accounting principles applicable to a going concern which contemplates
      the realization of assets and settlement of liabilities in the normal course
      of
      business as they come due. In addition to the Company’s working capital
      requirements and its cumulative losses during the period ended March 31, 2007
      and since inception, the Company must also secure sufficient funding to meet
      its
      spending and purchase option obligations with respect to its mineral properties
      in order to maintain its option to purchase certain mining and mineral rights.
      These circumstances lend substantial doubt as to the ability of the Company
      to
      meet its obligations as they come due and, accordingly, as to the
      appropriateness of the use of accounting principles applicable to a going
      concern. In recognition of these circumstances, the Company raised funding
      of
      $9,020,000 through a private placement of additional share capital in March
      2007
      and intends to continue relying upon the issuance of securities to finance
      exploration, meet contractual obligations and continue as a going concern.
      As of
      the date of the approval of the consolidated financial statements, there is
      no
      assurance that these initiatives will be sufficient or successful.





The
      Company’s ability to continue as a going concern is dependent upon its ability
      to fund its working capital and exploration requirements and, eventually, upon
      the future exploration and development of profitable operations from its mineral
      properties. These consolidated financial statements do not reflect the
      adjustments to the carrying values of assets and liabilities and the reported
      expenses and balance sheet classifications that would be necessary if the going
      concern assumption were not appropriate, and these adjustments could be
      material.




F-7
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**


**NOTE
      2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**





**Basis
      of Presentation**





The
      accompanying unaudited interim consolidated financial statements have been
      prepared in accordance with the accounting principles generally accepted in
      the
      United States for interim financial information and with the instructions to
      Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly, they do not include
      all of the information and footnotes required by accounting principles generally
      accepted in the United States for complete financial statements. In the opinion
      of management, all adjustments (consisting of normal recurring adjustments)
      considered necessary for a fair presentation have been included. Operating
      results for the three month period ended March 31, 2007 are not necessarily
      indicative of the results that may be expected for the year ended
      December 31, 2007.





The
      consolidated balance sheet at March 31, 2007 has been derived from the
      audited financial statements at December 31, 2006 but these financial statements
      do not include all of the information and footnotes required by accounting
      principles generally accepted in the United States for complete financial
      statements. For further information, refer to the financial statements and
      footnotes thereto included in the Company’s annual report on Form 10-KSB for the
      year ended December 31, 2006.





**Use
      of Estimates**





The
      preparation of financial statements in conformity with U.S. generally accepted
      accounting principles requires management to make estimates and assumptions
      that
      affect the reported amount of assets and liabilities and disclosure of
      contingent assets and liabilities at the date of the financial statements and
      the reported amount of revenues and expenses during the period. Actual results
      may differ from those estimates.





**Consolidation**





Entities
      which are controlled by the Company, either directly or indirectly, are
      consolidated. Control is established by the Company’s ability to determine
      strategic, operating, investing and financing policies without the co-operation
      of others. The Company analyzes its level of ownership, voting rights and
      representation on the board of directors in determining if control exists by
      any
      one, or a combination of these factors.





These
      consolidated financial statements include the accounts of (i) Colombia
      Goldfields Ltd., Delaware corporation (ii) the Company’s 90% interest in RNC
      (Colombia) Limited (“RNC”), a Belize corporation and its 94.99% owned subsidiary
      - Compania Minera De Caldas, S.A. (“Caldas”), a Colombia corporation, (iii) the
      Company’s 94.99% interest in Gavilan Minerales, S.A. (“Gavilan”) a Colombia
      corporation. All
      significant inter-company transactions and balances have been eliminated upon
      consolidation.





In
      accordance with Interpretation No. 46R, *Consolidation
      of Variable Interest Entities* (“FIN 46R”),
      variable interest entities (VIEs) are generally entities that lack sufficient
      equity to finance their activities without additional financial support from
      other parties or whose equity holders lack adequate decision making ability.
      All
      VIEs with which the Company is involved must be evaluated to determine the
      primary beneficiary of the risks and rewards of the VIE. The primary beneficiary
      is required to consolidate the VIE for financial reporting purposes.





At
      January 12, 2006 and in
      connection with the adoption of FIN 46R, the Company concluded that RNC and
      its 94.99% owned subsidiary, Caldas,
      S.A., were
      VIEs since the Company provided the principal financial support to these
      entities and the Company was their primary beneficiary. Under FIN 46R
      transition rules, the financial statements of RNC and Caldas,
      S.A. were
      considered VIEs and the Company’s 25% interest has been included within the
      Company’s consolidated financial statements for the period January 12, 2006 to
      April 28, 2006.





F-8
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**


In
      connection with the Company’s April 28, 2006 acquisition of an additional 25% of
      RNC, the Company also received rights to nominate three of the four members
      of
      RNC’s board of directors. As such, the Company determined that control over RNC
      existed as of April 28, 2006, and these financial statements reflect the
      consolidation of the Company’s 50% interest in RNC, for the period April 29,
      2006 to August 22, 2006.





On
      August
      22, 2006 the Company acquired an additional 25% of RNC, bringing the Company’s
      total ownership to 75%. These financial statements reflect the consolidation
      of
      the Company’s 75% interest in RNC for the period August 23, 2006 to December 14,
      2006.





On
      September 25, 2006 the Company acquired 94.99% of the outstanding shares of
      Gavilan. These financial statements reflect the consolidation of Gavilan for
      the
      period of September 25, 2006 to March 31, 2007.





On
      December 14, 2006 the Company acquired a further 15% of RNC, bringing the
      Company’s total ownership to 90%. These financial statements reflect the
      consolidation of the Company’s 90% interest in RNC for the period December 15,
      2006 to March 31, 2007.





Since
      the
      non-controlling shareholders of RNC and Gavilan have no obligation to contribute
      any additional capital and the Company was the primary entity obligated to
      fund
      future exploratory work, no non-controlling interest related to RNC or Gavilan
      has been recognized in the consolidated statements of operations for the period
      January 1, 2006 to March 31, 2007 and in the consolidated balance sheet at
      March
      31, 2007.





**Mineral
      Property Rights Acquisition and Exploration Expenditures**





Costs
      of
      acquiring mining properties are capitalized upon acquisition. Pursuant to SFAS
      No. 34, *Capitalization of Interest Costs*, interest costs attributable
      to mineral property acquisitions are also capitalized.  Mine development
      costs incurred either to develop new ore deposits, expand the capacity of mines,
      or to develop mine areas substantially in advance of current production are
      also
      capitalized once proven and probable reserves exist and the property is a
      commercially mineable property. Costs incurred to maintain current production
      or
      to maintain assets on a standby basis are charged to operations. Costs of
      abandoned projects are charged to operations upon abandonment. The Company
      evaluates the carrying value of capitalized mining costs and related property,
      plant and equipment costs, to determine if these costs are in excess of their
      net recoverable amount whenever events or changes in circumstances indicate
      that
      their carrying amounts may not be recoverable. The periodic evaluation of
      carrying value of capitalized costs and any related property, plant and
      equipment costs are based upon expected future cash flows and/or estimated


salvage
      value in accordance with Statement of Financial Accounting Standards (SFAS)
      No.
      144, *Accounting
      for Impairment or Disposal of Long-Lived Assets.*





**Asset
      Retirement Obligations**





The
      Company applies SFAS No. 143, *Accounting
      for Assets Retirement Obligations* which
      requires that the fair value of a liability for an asset retirement obligation
      be recognized in the period in which it is incurred. SFAS No. 143 requires
      the
      Company to record a liability for the present value of the estimated site
      restoration costs with a corresponding increase to the carrying amount of the
      related long-lived assets. The liability will be accreted until it has been
      fully incurred and the asset will be amortized over the life of the related
      assets. Adjustments for changes resulting from the passage of time and changes
      to either the timing or amount of the original present value estimate underlying
      the obligation will be made. As at March 31, 2007 and December 31, 2006 the
      Company does not have any asset retirement obligations.





**Cash
      and Cash Equivalents**





The
      Company considers all highly liquid instruments with a maturity of three months
      or less at the time of issuance to be cash equivalents.





F-9
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**


**Property
      and Equipment**





Property
      and equipment are carried at cost. For the significant components of property
      and equipment, depreciation is provided for using the following method and
      time
      periods:





**Asset**
            **Basis**
            **Period**Vehicles
            Straight
                line
            5
                yearsBuildings
            Straight
                line
            20
                yearsOffice
                equipment & furniture
            Straight
                line
            3
                to 10 years





The
      Company regularly reviews the carrying values of property and equipment based
      on
      expected future cash flows whenever events or changes in circumstances indicate
      that the carrying amounts may not be recoverable. If this carrying value exceeds
      the recoverable amount, a write-down is charged to the statement of
      operations.





**Environmental
      Costs**





Environmental
      expenditures that related to current operations are charged to operations or
      capitalized as appropriate. Expenditures that relate to an existing condition
      caused by past operations, and which do not contribute to current or future
      revenue generation, are charged to operations. Liabilities are recorded when
      environmental assessments and/or remedial efforts are probable, and the cost
      can
      be reasonably estimated. Generally, the timing of these accruals coincides
      with
      the earlier of completion of a feasibility study or the company’s commitment to
      plan of action based on the then known facts.





**Comprehensive
      Income**





In
      accordance with SFAS 130, *Reporting
      Comprehensive Income* (“SFAS
      130”), comprehensive income consists of net income and other gains and losses
      affecting stockholders’ equity that are excluded from net income, such as
      unrealized gains and losses on investments available for sale, foreign currency
      translation gains and losses when the Company has a functional currency other
      than US dollars, and minimum pension liabilities. For all periods presented,
      the
      Company’s financial statements do not include any of the additional elements
      that affect comprehensive income. Accordingly, net income and comprehensive
      income are identical.





**Stock-Based
      Compensation**





On
      January 1, 2006, the Company applied SFAS No. 123(R), *Share-Based
      Payment* ,
      to
      account for stock options and similar equity instruments issued. Accordingly,
      compensation expense attributable to stock options or similar equity instruments
      granted are measured at the fair value at the grant date and recognized over
      the
      expected vesting period. For all stock option awards granted on or after January
      1, 2006, the Company recognizes compensation using the fair value method of
      accounting for stock-based compensation. The fair value of stock options is
      estimated at the grant date using the Black-Scholes option pricing model. In
      the
      event stock options are forfeited, any previously recognized compensation
      expense related to unvested and expiring awards is recognized in earnings during
      the period of forfeiture.





Although
      the assumptions used to record stock compensation expense reflect management’s
      best estimates, they involve inherent uncertainties based on market conditions
      generally outside of the control of the Company. If other assumptions were
      used,
      stock-based compensation expense could be significantly impacted. As stock
      options are exercised, the proceeds received on exercise, in addition to the
      previously recognized amounts related to those stock options, are credited
      to
      stockholders’ equity. The adoption of SFAS No. 123(R) did not have an impact on
      the Company’s historical financial statements as the Company had no stock
      options outstanding prior to adoption.





F-10
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**


The
      Company provides direct stock awards to certain directors, officers, and
      consultants. Direct stock awards are typically subject to a two year vesting
      period. Direct stock awards are recorded at fair value on the grant date, with
      compensation expense recognized on a straight-line basis over the vesting
      period.





**Foreign
      Currency Translation**





The
      Company’s functional currency is US dollars. Accordingly, foreign currency
      balances are translated into US dollars as follows i) Monetary assets and
      liabilities are translated at the period-end exchange rate ii) Non-monetary
      assets are translated at the rate of exchange in effect at their acquisition
      date; and iii)  Revenue
      and expense items are translated at the average exchange rate for the respective
      period.





Foreign
      exchange gains and losses are recognized as period expenses.





**Earnings
      (Loss) per Share**





Basic
      earnings (loss) per share is computed by dividing net earnings (loss) available
      to common stockholders by the weighted average number of common shares
      outstanding during the period. Diluted net earnings (loss) per share on the
      potential exercise of the equity-based financial instruments is not presented
      where anti-dilutive. For the three months ended March 31, 2007 and 2006,
      outstanding share purchase warrants and options to purchase common shares were
      excluded from the computation of diluted earnings per share as the impact of
      these instruments was antidilutive as a result of losses incurred in these
      periods.





**Income
      taxes**





The
      Company accounts for income taxes using the asset and liability method which
      requires the recognition of deferred tax assets and liabilities for the expected
      future tax consequences of events that have been recognized in the Company’s
      financial statements or tax returns.




**Long-Lived
      assets**





Long-lived
      assets of the Company are reviewed for impairment whenever events or
      circumstances indicate that the carrying amount of assets may not be
      recoverable, pursuant to SFAS No. 144, *Accounting
      for the Impairment or Disposal of Long-Lived Assets* and EITF
      04-3, *Mining
      Assets: Impairment and Business Combinations.*





Management
      considers assets to be impaired if the carrying value exceeds the future
      projected cash flows from related operations (undiscounted and without interest
      charges). If impairment is deemed to exist, the assets will be written down
      to
      fair value. Fair value is generally determined using a discounted cash flow
      analysis.





**Financial
      Instruments**





The
      Company’s financial instruments consist of cash and cash equivalents, accounts
      payable and accrued liabilities and amounts due to and from related parties.
      The
      carrying value of these financial instruments approximates their fair value
      based on their liquidity or their short-term nature. The Company is not exposed
      to significant interest, credit or currency risk arising from these financial
      instruments.





F-11
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**


**NOTE
      3 - MINERAL PROPERTIES AND EXPLORATION RIGHTS**





Title
      to
      mineral properties and mining and exploration rights involves certain inherent
      risks due to the difficulties of determining the validity of certain claims
      as
      well as the potential for problems arising from the frequently ambiguous
      conveyance history characteristic of many mining properties. The Company cannot
      give any assurance that title to such properties will not be challenged or
      impugned and cannot be certain that the Company will have valid title to its
      mining properties. The Company relies on title opinions by legal counsel who
      base such opinions on the laws of countries in which the Company operates.





**A)
      Caramanta Project**





(i)
      Caramanta Project - Concessions 6602, 1343 and 6329





On
      September 22, 2005, the Company entered into an Assignment Agreement with
      Investcol Limited (“Investcol”), a related party, where Investcol assigned,
      transferred, and conveyed to the Company all of its rights under a contract
      for
      Purchase Option of Mining Concessions (“Original Option Contract”) entered into
      with Cia Servicios Y Logisticos Ltda. As the result of the Assignment Agreement,
      the Company acquired an option to purchase certain mining, mineral and
      exploration rights on property known as Concessions 6602, 1343 and 6329 located
      in Caramanta Municipality, Antioquia Department, Medellin, Colombia for $10,000,
      on condition that $2,990,000 is invested in exploratory work on the property
      over a three year period. The Company issued 1,000,000 common stock to Investcol
      at a deemed fair market value $0.25 per share for total consideration of
      $250,000. At the date of acquisition of these mineral rights the Company had
      not
      yet incorporated a Company in Colombia and had not gained the support of the
      Colombian federal or local governments. Due to these uncertainties, the initial
      $260,000 was considered mineral property exploration and was recorded as part
      of
      mineral property exploration expenses in the consolidated statement of
      operations in fiscal 2005.





Pursuant
      to the Assignment Agreement, the Company was committed to fund $2,990,000
      exploratory work as follows:





a)
            $500,000
                upon the closing of the Assignment
                Agreement;


b)
            $750,000
                during the 12 month period commencing June 25, 2006; and on the earlier
                of
                June, 2006 or commencement of the second exploration phase, one million
                restricted shares of the Company’s common shares;
                and


c)
            $1,740,000
                during the 12-month period commencing June 25,
                2007.





On
      September 25, 2006 the Assignment Agreement was superseded in connection with
      the Company’s agreement to acquire the Mining Concessions. (See note 3(A)(iii)
      below for further details)





(ii)
      Caramanta Project - Concessions 6993, 7039, 6821 and 6770 and HET 31, 32, 26,
      27
      and HETG 01





On
      February 16, 2006 the Company entered into a Letter of Intent (“LOI”) with
      Investcol to acquire Investcol’s rights in a Contract for Purchase (“Purchase
      Contract”) entered into with Cia Servicios y Logisticos Ltda. The LOI outlined a
      proposed transaction where the Company intended to acquire Investcol’s rights to
      acquire mining contracts to exclusively engage in mining activities on
      concessions 6993, 7039, 6821 and 6770 (the “Contracts”) and options that
      Investcol holds to acquire the exclusive rights to engage in mining activities
      on concessions HET 31, 32, 26, 27 and HETG 01 (the “Options”) all located within
      an area in Colombia referred to as the Caramanta location.





F-12
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**


The
      LOI
      was non-binding and subject to final negotiation and the execution of a
      definitive agreement. On April 10, 2006, the Company entered into a definitive
      agreement with Investcol finalizing this transaction (“Assignment Agreement”).
      In consideration for this Assignment Agreement, the Company paid Investcol
      total
      consideration in the amount of $350,000 and issued 1,000,000 restricted shares
      of common stock. Under the terms of the Assignment Agreement, Investcol agreed
      to pay the exercise price of $150,000 on the Options whose titles will remain
      in
      the name of Cia Servicios until the final exploration commitments have been
      made. The final option payments were made prior to July 30, 2006.





On
      September 25, 2006 the Assignment Agreement was superseded in connection with
      the company’s agreement to acquire the Mining Concessions. (See note 3(A)(iii)
      below for further details)





(iii)
      Caramanta Project - Acquisition of the Caramanta Exploration
      Properties





On
      September 25, 2006 the Company, through the acquisition of the outstanding
      shares of Gavilan, acquired full legal title to the Caramanta project
      concessions described in Notes 3A(i) and 3A(ii) above. Consideration paid for
      the acquisition included $300,000 cash and the issuance of 1,150,000 restricted
      common shares at a fair value of $1.41 per share. In addition, a $50,000
      finder’s fee was paid to Investcol. The total acquisition cost of $1,971,500 was
      allocated to the net assets acquired as follows:





Mineral
                and exploration and properties rights
            $
            1,780,841Property,
                plant and equipment
            
            190,659$
            1,971,500





The
      purchase was recorded as part of i) acquired mineral and exploration properties
      and rights and ii) property, plant and equipment in fiscal 2006. As a result
      of
      the acquisition of Gavilan, the Company no longer has any minimum exploratory
      work obligations related to the Caramanta concessions.





**B)
      Marmato Project**




On
      January 12, 2006, the Company entered into a Stock Purchase Agreement with
      Investcol and RNC (the "Agreement"), whereby the Company (i) acquired
      twenty-five percent (25%) of the issued and outstanding stock of RNC, a Belize
      corporation ("RNC") and (ii) held an option to acquire the remaining seventy
      five percent (75%) of RNC's issued and outstanding stock over a period of time.
      RNC is the beneficial holder of 94.99% of the issued and outstanding stock
      of
      Caldas, a Colombia corporation that (i) owns certain mining, mineral and
      exploration rights, (ii) has options to acquire mining, mineral and exploration
      rights and (iii) has exclusive rights to evaluate certain property, all located
      in the Zona Alta portion of the Marmato project in Colombia.





Pursuant
      to the Stock Purchase Agreement, the Company:





a)
            Acquired
                25% of the outstanding shares of RNC (total 25% of RNC) by the issuance
                of
                1,000,000 common shares of the Company to Investcol and the advance
                to RNC
                of a $1,200,000 non-interest bearing loan. Total consideration of
                $1,900,000 related to this transaction was recorded as part of acquired
                mineral and exploration properties and rights in fiscal
                2006.  b)
            Acquired an additional 25% of RNC (total 50% of
              RNC) by
              the issuance of 2,000,000 shares of the Company to Investcol and the
              advance of an additional $4,000,000 non-interest bearing loan to RNC
              in
              two instalments of $1,000,000 and $3,000,000 on or before March 15,
              2006
              and April 30, 2006, respectively. On March 10, 2006, the Company entered
              an extension agreement with Investcol to extend the terms to April
              30,
              2006, and completed the transaction on April 28, 2006. Total consideration
              of $5,480,000 related to this transaction was recorded as part of acquired
              mineral and exploration properties and rights in fiscal
              2006.





F-13
 Table
          of Contents
 **COLOMBIA
            GOLDFIELDS LTD.**
 **(An
            Exploration Stage Company)**
 **NOTES
            TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**




c)
            Held
                the option to acquire an additional 25% of RNC (total 75% of RNC)
                by the
                issuance of 4,000,000 common shares of the Company to Investcol and
                the
                advance of an additional $15,000,000 non-interest bearing loan to
                RNC on
                or before October 30, 2006.On
                August 22, 2006, the Company amended its January 12, 2006 Stock Purchase
                Agreement with Investcol and RNC and concurrently exercised its option
                to
                increase the Company’s interest in RNC from 50% to 75%. Under the terms of
                the amended agreement, the Company issued 4,200,000 common shares
                and paid
                $200,000 to Investcol. In connection with this transaction, the Company
                committed to providing an additional $5,000,000 by way of non-interest
                bearing demand loan to RNC by December 31, 2006 and providing sufficient
                funds to RNC, upon terms satisfactory to the Company, to complete
                a full
                bankable feasibility study of the Marmato Project. Total consideration
                of
                $ 4,820,000 related to this transaction was recorded as part of acquired
                mineral and exploration properties and rights in fiscal
                2006.





d)
            Held
                the option to acquire an additional 25% of RNC (total 100% of RNC)
                until
                May 1, 2009 for a price equal to the 25% of the value of Caldas determined
                by a bankable feasibility study prepared by a certified mineral property
                evaluator, or other acceptable third party. The purchase price was
                payable
                in either cash or the Company’s common shares.Under the terms of the August 22, 2006 amended agreement, the Company
                held
                an option to acquire the remaining 25% of RNC on or before May 1,
                2009 for
                a purchase price equal to 25% of the fair value of Caldas determined
                by a
                feasibility study. The purchase price, pursuant to the amended agreement,
                was limited to a maximum of $15,000,000 plus 4,000,000 shares of
                the
                Company. Payment of the purchase price was payable in either cash
                or
                common shares of the Company, or any combination thereof. On December
                14,
                2006, the parties executed a Second Amendment to the Stock Purchase
                Agreement (the “Second Amendment”) in order to revise the consideration
                required to exercise the Company’s option to acquire the remaining 25% of
                the issued and outstanding stock of RNC. Subject to the revised terms
                set
                forth in the Second Amendment, the Company held the option to acquire
                an
                additional 15% interest in RNC, in exchange for the issuance of 4,000,000
                common shares of the Company to Investcol. In connection with the
                execution of the Second Amendment, the Company exercised its option,
                resulting in the Company acquiring an additional 15% of RNC, bringing
                the
                Company’s total ownership to 90%. The revised terms set forth in the
                Second Amendment provide that the Company has the option to acquire
                the
                remaining 10% of RNC until May 1, 2009 in exchange for a purchase
                price of
                $15,000,000. The purchase price can be made in either cash, shares
                of our
                common stock, or any combination thereof. Total consideration of
                $5,120,000 related to this transaction was recorded as part of acquired
                mineral and exploration properties and rights in fiscal
                2006.





**C)
      Kedahda Properties**




On
      August
      30, 2006 the Company, purchased certain mining exploration properties in the
      Republic of Colombia and the related geochemical and other proprietary
      geological data from a wholly-owned subsidiary of Anglo Gold Ashanti, Sociedad
      Kedahda, S.A., for $500,000 cash consideration. The purchase was recorded as
      part of acquired mineral and exploration properties and right in fiscal
      2006.





**Mineral
      Property Rights Acquisition and Exploration Expenditures**





The
      Company’s mineral property acquisition and exploration expenditures consist
      of





I)
            The
                acquisition of mineral concessions;


II)
            The
                acquisition of mineral and exploration rights from existing titleholders;


III)
            The
                exploration of acquired mineral properties and related activities;
                and


IV)
            Stock-based
                compensation allocated pursuant to FAS
                123(R)





The
      following table summarizes the Company’s mineral concession acquisitions,
      mineral rights acquisitions, and mineral exploration expenses as recorded in
      the
      Company’s Consolidated financial statements for the period from Inception (March
      25, 2003) through March 31, 2007:





F-14
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**




**Three
                Months Ended**
              **March
                31,****2007**
            
            **Three
                Months Ended**
              **March
                31,****2006**
            
            **Cumulative**
              **From**
              **Inception**
              **(March
                25, 2003)**
              **Through**
              **March
                31,****2007**I)
            Acquisition
                ofmineral
                concessions
            $
            -
            
            $
            1,900,000
            
            $
            22,200,841II)
            Acquisition
                of mineral and exploration rights
            
            3,740,583
            
            
            254,400
            
            
            14,379,654Total
                acquired mineral and exploration properties and rights
            
            3,740,583
            
            
            2,154,400
            
            
            36,580,495III)
            Exploration
                ofacquiredmineralproperties
            
            1,256,891
            
            
            507,074
            
            
            5,521,032IV)
            Stock
                basedCompensation
            
            215,125
            
            
            65,549
            
            
            428,720Total
                mineral propertyexploration
                expenses
            
            1,472,016
            
            
            572,623
            
            
            5,949,752Total
                  mineralproperty
                  rightsacquisitionand
                  explorationexpenditures
            $
            5,212,599
            
            $
            2,727,023
            
            $
            42,530,247





**Capitalized
      Mineral and Exploration Properties and Rights**





Acquired
      mineral and exploration properties and exploration rights at March 31, 2007
      of
      $36,580,495 have been recorded at amounts necessary to reflect temporary
      differences associated with the differences between their accounting and tax
      bases. These differences arise primarily due to differences between the assigned
      values and tax bases of acquired Caramanta Project and Marmato Project mineral
      concessions. As a result, acquired mineral and exploration properties and rights
      are recorded in the consolidated balance sheets as follows:





**March
                31, 2007**
            
            **December
                31, 2006**Purchase
                of mineral exploration rights
            $
            36,580,495
            
            $
            32,839,912Recognition
                of deferred tax liability upon acquisition
            
            10,688,474
            
            
            10,688,474Mineral
                and exploration properties and rights
            $
            47,268,969
            
            $
            43,528,386





**NOTE
      4 - PROPERTY AND EQUIPMENT**





**As
                at March 31, 2007**
            **Cost**
            
            **Accumulated**
              **Amortization**
            
            **Net
                Book**
              **Value**Furniture
                and office equipment
            $
            185,559
            
            $
            (18,690)
            
            $
            166,869Building
            
            87,181
            
            
            (2,592)
            
            
            84,589Vehicles
            
            193,478
            
            
            (29,637)
            
            
            163,841Total
            $
            466,218
            
            $
            (50,919)
            
            $
            415,299




F-15
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**




**As
                at December 31, 2006**
            **Cost**
            
            **Accumulated**
              **Amortization**
            
            **Net
                Book**
              **Value**Furniture
                and office equipment
            $
            171,656
            
            $
            (11,292)
            
            $
            160,364Building
            
            87,033
            
            
            (1,451)
            
            
            85,582Vehicles
            
            193,149
            
            
            (19,362)
            
            
            173,787Total
            $
            451,838
            
            $
            (32,105)
            
            $
            419,733





**NOTE
      5 - STOCKHOLDERS’ EQUITY**





**Common
      Stock**





**March
                31, 2007**
            
            **December
                31, 2006****Authorized:**200,000,000
                common shares, $0.00001
                par value**Issued
                and Outstanding:**65,706,849
                  commonshares
                (December
                  31, 2006:56,036,849
                  shares)
            $
            661
            
            $
            565





i)
            During
                the three months ended March 31, 2007, the Company completed the
                following
                transactions:





a)
            On
                March 21, 2007, the Company completed a private equity offering of
                9,020,000 common shares at $1.00 per common share. The gross proceeds
                received from the offering were $9,020,000. In connection with this
                private equity offering, the Company paid a commission of $541,200
                and
                issued agents’ warrants to purchase 541,200 shares of the Company’s common
                stock with each warrant exercisable for a period of 36 months from
                the
                closing of the offering at an exercise price of $1.00 per share.
                The fair
                value of the agents’ warrants was $404,276 and has been accounted for as a
                reduction of the additional paid-in capital associated with the related
                March 21, 2007 common stock
                issuance.





b)
            On
                March 22, 2007, the Company issued 650,000 common shares to certain
                consultants to the Company for services rendered as described under
“Stock
                Options and Other Stock-Based Compensation”.





ii)
            During
                the year ended December 31, 2006, the Company completed the following
                transactions:




a)
            On
                January 10, 2006, the Company issued 3,126,083 common shares at $0.60
                per
                share for gross proceeds of $1,875,650. The Company paid finders
                fees in
                the amount of $187,565, for net proceeds of
                $1,688,085.  b)
            On February 14, 2006, the Company issued 1,000,000
              common
              shares at fair value of $1.90 per share to Investcol in connection
              with
              the acquisition of 25% ownership of RNC (See Note 3).  c)
            On April 10, 2006, the Company issued 1,000,000
              common
              shares at fair value of $2.25 per share to Investcol to acquire rights
              in
              certain properties in the Caramanta area of Colombia. See Note
              3)




F-16
 Table
          of Contents
 **COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**




d)
            On April 26, 2006, the Company completed a private
                equity offering of 6,500,666 Units at $1.50 per Unit to a total of
                26
                investors. Each Unit consists of one (1) share of common stock, par
                value
                $0.00001, and one (1) Warrant (the “Warrant”) to purchase one (1) share of
                common stock, exercisable for twenty-four (24) months from the closing
                of
                the offering. The exercise price for the Warrant is priced at $2.50.
                The
                gross proceeds received from this offering were $9,751,000. Assuming
                that
                the investors exercise all of the Warrants, the gross proceeds received
                from the exercise of the Warrants will equal $16,251,665.
              
              In
                connection with this private equity offering, the Company paid as
                a
                commission $585,061 and issued warrants to purchase 390,040 shares
                of the
                Company’s common stock with each warrant exercisable for a period of
                thirty-six (36) months from the closing of the offering at the exercise
                price of $2.00 per share. Assuming that all of these warrants are
                exercised, the Company will receive gross proceeds of
                $780,080. The
        Company has allocated the total net proceeds from the offering of $9,165,939
        to
        the various underlying equity instruments comprising the equity offering,
        based
        on the estimated relative fair value of each instrument at the offering date,
        as
        follows:





Common
                shares
            $
            65Additional
                paid in capital - common shares
            
            6,416,112Additional
                paid in capital - share purchase warrants
            
            2,749,762Total
                gross proceeds from private equity offering
            $
            9,165,939




e)
            On April 28, 2006, in connection with the acquisition
              of
              the second 25% of RNC, the Company issued 2,000,000 common shares at
              a
              fair values of $2.74 to Investcol. (See Note
              3).  f)
            On August 22, 2006 in connection with the acquisition
              of
              the third 25% of RNC, the Company issued 4,200,000 common shares at
              a
              value of $1.10 per share to Investcol. (See Note
              3).  g)
            On
              September 25, 2006 in connection with the Company’s acquisition of 100% of
              the Caramanta Exploration Properties, the Company issued 1,150,000
              restricted common shares at a value of $1.41 (see Note
              3).  h)
            On
              October 14, 2006 3,471,000 share purchase warrants were exercised for
              net
              proceeds to the Company of $1,735,500 and 3,471,000 common shares were
              issued upon exercise.  i)
            On
              December 14, 2006 in connection with the acquisition of the forth 15%
              of
              RNC, the Company issued 4,000,000 common shares at a value of $1.28
              per
              share to Investcol (See Note 3).




F-17
 Table
          of Contents


**COLOMBIA
        GOLDFIELDS LTD.**
 **(An
        Exploration Stage Company)**
 **NOTES
        TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**





**Warrants**





As
      at
      March 31, 2007, the following warrants were issued and outstanding:





**#
                Warrants**
            **Exercise
                Price**
            **Expiry
                Date**6,500,666
            $2.50
                per share
            April
                25, 2008390,040
            $2.00
                per share
            April
                25, 2009541,200
            $1.00
                per share
            March
                22, 20107,431,906
            $2.36
                per share





**Stock
      Options and Other Stock-Based Compensation**





**Stock
      Options**





In
      fiscal
      2006, the Company adopted the 2006 Stock Incentive Plan, (the “Plan”) which
      provides for the grant of incentive stock options, non-qualified stock options,
      stock appreciation rights, restricted stock, performance shares and performance
      units, and stock awards to officers, directors or employees of, as well as
      advisers and consultants to, the Company.





All
      stock
      options and rights are to vest over a period determined by the Board of
      Directors and expire not more than ten years from the date granted. On
      July
      31, 2006 the Company received shareholder approval for an amended Stock
      Incentive Plan. Pursuant to the amended Plan, the number of shares that may
      be
      issued for awards granted under the 2006 plan was increased from 3,500,000
      to
      5,000,000.





Pursuant
      to the Plan, during fiscal 2007 the Company granted 1,640,000 stock options
      to
      employees, directors, officers and consultants of the Company. These stock
      options vest at a rate of 25% every six months over a period of two years,
      and
      expire over a life of 10 years. For the three months ended March 31, 2007,
      the
      Company recorded a total of $312,177 in stock based compensation expense related
      to stock options in the consolidated statement of operations.





A
      summary
      of stock options granted and exercised is as follows:





**Shares**
            
            **Weighted
                Average**
              **Exercise****Price**Options
                outstanding at December 31, 2006
            
            2,787,500
            
            $
            1.16Granted
                in fiscal 2007
            
            1,640,000
            
            
            1.17Exercised
                in fiscal 2007
            
            -
            
            
            -Forfeited
                and expired in fiscal 2007
            
            (275,000)
            
            
            (0.75)Options
                outstanding at March 31, 2007
            
            4,152,500
            
            $
            1.19





**Period
                Ended**
              **March
                31, 2007**
            
            **Period
                Ended**
              **March
                31, 2006**Weighted
                  average fair
                  value
                  of optionsgranted
                  during the period
            $
            0.98
            
            $
            0.99Weighted
                  average fairvalue of options vested during
                  the period
            $
            1.20
            
            $
            -




F-18
 Table
          of Contents


**COLOMBIA
        GOLDFIELDS LTD.**
 **(An
        Exploration Stage Company)**
 **NOTES
        TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**





A
      summary
      of stock options outstanding and exercisable at March 31, 2007 is as
      follows:





**Range
                of**
              **Exercise****Prices**
            **Number**
              **Outstanding**
            **Weighted**
              **Average**
              **Exercise**
              **Price**
            **Weighted**
              **Average**
              **Remaining**
              **Contractual**
              **Life
                (yrs)**
            **Number**
              **Exercisable**
            **Weighted**
              **Average**
              **Exercise**
              **Price**$0.75
                - $1.00
            762,500
            $
                0.75
            8.77
            637,500
            $
                0.75$1.01
                - $2.00
            3,390,000
            1.29
            9.61
            475,000
            1.56$0.75
                - $2.00
            4,152,500
            $
                1.19
            9.46
            1,112,500
            $
                1.09





The
      fair
      value of each option granted has been estimated as of the date of the grant
      using the Black-Scholes option pricing model with the following assumptions:
      risk-free interest rate of 4.45%, dividend yield 0%, a historic volatility
      of
      76%, and expected term of 10 years, equal to the full life of the options as
      the
      Company does not expect any options to be exercised early.





**Other
      Stock-Based Compensation**





On
      October 1, 2006, the Company agreed to grant 500,000 common shares to a
      consultant providing services to the Company. Pursuant to the terms of the
      Consulting Agreement, should the Consultant’s employment terminate by the
      Consultant’s resignation before the period of two years has elapsed, the
      Consultant is required to return a pro rata portion of the shares based on
      the
      time remaining in the contract. In the case of a change in control of the
      Company by merger or sale of a majority stake or otherwise, the shares held
      by
      the Consultant will immediately vest. The fair value of the common stock award,
      based on the market price of the Company’s common shares at the agreement date,
      was $915,000. The shares were issued on March 22, 2007 and the Company accounts
      for this award by recognizing compensation expense ratably over twenty-four
      months, commencing on the agreement date. For the three months ended March
      31,
      2007, the Company recorded a total of $114,375 in stock based compensation
      expense related to this award in the fiscal 2007 consolidated statement of
      operations.





On
      January 15, 2007, the Company agreed to grant 150,000 common shares to a
      consultant for services rendered to the Company for the three months ended
      March
      31, 2007. The fair value of the common stock award, based on the market price
      of
      the Company’s common shares at the agreement date, was $166,500. The shares were
      issued on March 22, 2007 and the Company accounts for this award by recognizing
      compensation expense ratably over three months, commencing on the agreement
      date. For the three months ended March 31, 2007, the Company recorded a total
      of
      $166,500 in stock based compensation expense related to this award in the fiscal
      2007 consolidated statement of operations.





At
      March
      31, 2007, there was $713,750 of unrecognized compensation cost related to
      unvested direct share awards. The cost is recorded as prepaid consulting fees
      in
      the Company’s consolidated balance sheet at March 31, 2007.





**Summary
      of Stock-Based Compensation Expenses**





The
      following table summarizes stock-based compensation recorded in the consolidated
      statements of operations:





**Period**
              **Ended**
              **March****31,****2007**
            
            **Period**
              **Ended**
              **March****31,****2006**
            
            **Cumulative**
              **from
                Inception**
              **(March
                25, 2003)**
              **through**
              **March
                31,****2007**Mineral
                property rights exploration expenses
            $
            215,125
            
            $
            65,549
            
            $
            428,720General
                and administrative
            
            350,427
            
            
            420,940
            
            
            2,129,989Total
                stock-based compensation
            $
            565,552
            
            $
            486,489
            
            $
            2,558,709




F-19
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**




As
      at
      March 31, 2007, there was $2,353,602 of unrecognized compensation cost related
      to unvested stock options. The cost is expected to be recognized as follows:
      Fiscal 2007 - $1,664,935; Fiscal 2008 - $649,569; Fiscal 2009 - $39,098.





At
      March
      31, 2007, there was $713,750 unrecognized compensation cost related to unvested
      direct stock awards. The cost is expected to be recognized as follows: Fiscal
      2007-$370,625; Fiscal 2008 - $343,125.





**NOTE
      6 - ACCOUNTS PAYABLE AND ACCRUED LIABILITIES**





The
      Company in the normal course of business enters into contractual obligations
      with Colombian titleholders to acquire mineral and exploration rights. Upon
      signing, 25% of the negotiated purchase price is due and payable with an
      additional 25% due when all required documentation has been submitted to the
      local mining department and the final 50% due when the mining claim has been
      registered in the Company’s name. Included in accounts payable and accrued
      liabilities at March 31, 2007 is $5,770,312 (December 31, 2006 - $5,609,538)
      in
      amounts owing pursuant to these agreements.





**NOTE
      7 - INCOME TAXES**





The
      potential benefit of net operating loss carry forwards has not been recognized
      in the financial statements. Since the Company has no source of operating
      revenue, it cannot be assured that it is more likely than not that such benefit
      will be realized in future years. The components of the net deferred tax asset,
      net deferred tax liability, differences between the statutory rate and the
      effective rate, and the valuation allowance are as follows:





a)
            Components
                of income tax provision:





The
      components of the Company’s provision for (recovery of) income taxes consists of
      the following:





**Three
                  Months Ended**
                **March
                  31,
                  2007**
            
            **Three
                  Months Ended**
                **March
                  31,
                  2006**Domestic
            $
            -
            
            $
            -Foreign
            
            (424,710)
            
            
            -$
            (424,710)
            
            $
            -





For
      the
      three months ended March 31, 2007 the Company’s loss before provision for income
      taxes was generated in the following jurisdictions: Domestic $1,231,141; Foreign
      $1,697,000.





F-20
 Table
          of Contents
 **COLOMBIA
            GOLDFIELDS LTD.**
 **(An
            Exploration Stage Company)**
 **NOTES
            TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**




b)
            Income
                tax rate reconciliation:





The
      effective income tax rate differs from the statutory rate that would be obtained
      by applying the U.S. Federal income tax rate to net income (loss) before income
      taxes. These differences result from the following items:





**Three
                  Months Ended**
                **March
                  31,
                  2007**
            
            **Three
                  Months Ended**
                **March
                  31,
                  2006**US
                federal income tax rate
            
            34%
            
            
            15%Increase
                (decrease) in Income
                tax rate resultingFrom:Losses
                  not recognized fortax
                  purposes
            
            (7.7%)
            
            
            (15%)Tax
                  rate differences inforeign
                  subsidiaries
            
            (5.2%)
            
            
            -Other
                  permanentDifferences
            
            (6.6%)
            
            
            -Effective
                income tax rate
            
            14.5%
            
            
            -
                %





c)
            Component
                of deferred income tax provision:





The
      components of the temporary differences, which created the deferred income
      tax
      provision, are as follows:





**Three
                  Months Ended**
                **March
                  31,
                  2007**
            
            **Three
                  Months Ended**
                **March
                  31,
                  2006**Losses
                  carriedForward
            $
            (314,037)
            
            $
            (224,100)Tax
                    depreciation less than (greater than)
                  accounting
                    depreciation
            
            44,026
            
            
            -Foreign
                exploration costs
            
            (424,710)
            
            
            -$
            (694,721)
            
            $
            (224,100)Change
                in valuationAllowance
            
            270,011
            
            
            224,100Deferred
                income tax provision
            $
            (424,710)
            
            $
            -





d)
            Components
                of deferred tax asset and
                liability:





The
      components of the temporary differences which have created the deferred tax
      assets are:





**March
                31, 2007**
            
            **December
                31, 2006**Tax
                  depreciation less than(greater
                  than) depreciation
            $
            358,013
            
            $
            402,039Losses
                carriedForward
            
            1,066,360
            
            
            752,3231,424,373
            
            
            1,154,362Valuation
                allowance
            
            (1,424,373)
            
            
            (1,154,362)Deferred
                tax asset
            $
            -
            
            $
            -





The
      components of the temporary differences, which have created the deferred tax
      liability, are:





**March
                31, 2007**
            
            **December
                31, 2006**Tax
                  depreciation less than(greater
                than) accounting depreciation
            $
            -
            
            $
            -Tax
                  basis less than accountingbasis
                for mineral concessions
            
            (10,688,474)
            
            
            (10,688,474)Foreign
                exploration costs
            
            1,353,660
            
            
            928,950Deferred
                tax liability
            $
            (9,334,814)
            
            $
            (9,759,524)





F-21
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**





e)  The
      Company has income tax losses available for carry forward of $3,135,000 which
      expire as follows:





**Expiry
                Year**
            **Domestic**
            **Foreign**
            **Total**2023
            $
                36,500
            **$
                -**
            $
                36,5002024
            23,000
            -
            23,0002025
            310,500
            -
            310,5002026
            1,840,000
            -
            1,840,0002027
            925,000
            -
            925,000$
                3,135,000
            $
                -
            $
                3,135,000





**NOTE
      8 - RELATED PARTY TRANSACTIONS**





The
      Company, during the normal course of operations, engages in transactions with
      certain directors, senior officers, and shareholders of the
      Company.





Significant
      related party transactions reflected within the Company’s consolidated financial
      statements include:





i)
            The
                acquisition of the Company’s interest in the Caramanta and Marmato
                projects as described in notes 3(A) and 3(B) from Investcol, a company
                controlled by certain shareholders of the
                Company;





ii)
            Management
                and consulting fees paid to certain directors, senior officers, and
                shareholders of the Company; and





iii)
            Office
                rent paid to a Company related to a former director of the
                Company.





iv)
            The
                issuance and repayment of a short-term bridge loan during the first
                quarter of fiscal 2007. On February 27, 2007 the Company entered
                into a
                $3,700,000 promissory note between the Company and the Company’s
                President, a shareholder, and a Company controlled by these individuals.
                The loan, collateralized by the Company’s investment in RNC, was due and
                payable upon closing a planned equity financing, but in no case later
                than
                April 15, 2007. Upon repayment, an $185,000 loan origination fee
                was
                payable to the note holders. The note bore interest at 10% per annum,
                with
                monthly interest payments commencing February 28, 2007. Subsequent
                to the
                private placement described in note 5(i), on March 26, 2007 a total
                of
                $3,930,911 (representing the principal amount of the promissory note
                of
                $3,700,000, the loan origination fee of $185,000, and accrued interest
                of
                $45,911) was paid to the loan of the holders in full satisfaction
                of all
                amounts owing.





i)  During
      the three months ended March 31, 2007 the Company:




a)
            Paid $NIL for management and consulting fees to
              directors
              of the Company.  b)
            Paid $99,576 for management and consulting fees
              to senior
              officers of the Company.  c)
            Paid
                $114,614 for management and consulting fees to shareholders of the
                Company.





d)
            Paid
                $230,911 for interest and administration fees on a bridge loan from
                shareholders of the Company.





F-22
 Table
          of Contents


**COLOMBIA
          GOLDFIELDS LTD.**
 **(An
          Exploration Stage Company)**
 **NOTES
          TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS**





ii)  During
      the year ended December 31, 2006 the Company:





a)  Paid
      $186,306 for management and consulting fees to directors of the
      Company.





b)
      Paid
      $356,168 for management and consulting fees to senior officers of the
      Company.





c)
      Paid
      $332,400 for management and consulting fees to shareholders of the Company.





d)
      Paid
      $10,256 for office rent to a company related to a former director of the Company.





Included
      in prepaid expenses at March 31, 2007 is $15,000 (December 31, 2006: $30,000)
      related to a company controlled by shareholders of the Company. Included in
      accounts payable and accrued liabilities at March 31, 2007 is $NIL (December
      31,
      2006: $49,213) owing to a company controlled by shareholders of the Company.





**NOTE
      9 - NON-CASH ACTIVITIES**





The
      Company has issued common shares as consideration for the acquisition of certain
      mineral rights as disclosed in Notes 3 and 5.





**NOTE
      10 - SEGMENTED INFORMATION**





The
      Company has determined that it operates in a single reportable segment, being
      the acquisition of, exploration for, and development of mineral
      properties.





**NOTE
      11 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS**





The
      FASB
      has issued FIN 48, which prescribes rules for the financial statements
      accounting for uncertainty in income tax positions.





FIN
      48
      requires all material tax positions to undergo a new two-step recognition and
      measurement process. All material tax positions in all jurisdictions in all
      tax
      years in which the statute of limitations remains open upon the initial date
      of
      adoption are required to be assessed. For a tax benefit to be recognized it
      must
      be more likely than not that a tax position will be sustained upon examination
      based solely on its technical merits. If the recognition standard is not
      satisfied, then no tax benefit otherwise arising from the tax position can
      be
      recorded for financial statement purposes. If the recognition standard is
      satisfied, the amount of tax benefit recorded for financial statement purposes
      will be the largest amount of tax benefit with a greater than 50% likelihood
      of
      being realized upon ultimate settlement with a taxing authority. FIN 48 is
      effective for the Company’s fiscal 2007 year of the adoption of FIN 48 did not
      have a material impact on the Company’s financial position, results of the
      operations, or cash flows for the three months ended March 31,
      2007.





**NOTE
      12 - SUBSEQUENT EVENTS**





On
      April
      20, 2007 the Company filed a Registration Statement with the Securities and
      Exchange Commission (SEC) to register 9,170,000 common shares previously issued
      by the Company. Under the terms of the Company’s agreements with subscribers to
      the Company’s $9,020,000 March 21, 2007 private placement, if the SEC has not
      issued a Note of Effectiveness regarding the Registration Statement by September
      30, 2007, the Company is obligated to pay the subscribers to the offering a
      cash
      penalty of 1.5% per month for each month of delay, or portion
      thereof.





**NOTE
      13 - RECLASSIFICATIONS**





Certain
      prior period amounts have been reclassified to conform to the current period
      presentation.




F-23
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**Item2.     
Plan
      of
      Operation**





***Introduction***





This
      Management’s Discussion and Analysis, which has been prepared as of April 30,
      2007, is intended to supplement and complement our unaudited interim
      consolidated financial statements and notes thereto for the three months ended
      March 31, 2007 prepared in accordance with United States generally accepted
      accounting principles, or US GAAP (collectively, our “Financial Statements”).
      You are encouraged to review our Financial Statements in conjunction with your
      review of this MD&A. Additional information relating to our Company, is
      available at www.sec.gov.com. All dollar amounts in our MD&A are in US
      dollars, unless otherwise specified.





***Forward-Looking
      Statements***




Certain
      statements, other than purely historical information, including estimates,
      projections, statements relating to our business plans, objectives, and expected
      operating results, and the assumptions upon which those statements are based,
      are “forward-looking statements” within the meaning of the Private Securities
      Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933
      and Section 21E of the Securities Exchange Act of 1934. We
      intend
      such forward-looking statements to be covered by the safe-harbor provisions
      for
      forward-looking statements contained in the Private Securities Litigation Reform
      Act of 1995, and are including this statement for purposes of complying with
      those safe-harbor provisions.





Historical
      results and trends should not be taken as indicative of future operations.
      Management’s statements contained in this report that are not historical facts
      are forward-looking statements. Forward-looking statements, which are based
      on
      certain assumptions and describe our future plans, strategies and expectations,
      are generally identifiable by use of the words “believe, expect, intend,
      estimate, project,” “prospects,” or similar expressions.





Our
      ability to predict results or the actual effect of future plans or strategies
      is
      inherently uncertain. Factors which could have a material adverse affect on
      our
      operations and future prospects on a consolidated basis include, but are not
      limited to: changes in economic conditions, legislative/regulatory changes,
      availability of capital, interest rates and commodity prices, competition,
      and
      changes in generally accepted accounting principles, as well as items described
      under “Risks and Uncertainties" elsewhere in this MD&A. These risks and
      uncertainties should be considered in evaluating forward-looking statements
      and
      undue reliance should not be placed on such statements.





***First
      Quarter Fiscal 2007 Overview***





During
      the first quarter of fiscal 2007 progress was made towards our objective of
      defining and consolidating our ownership of a bulk-mineable ore body in the
      Marmato region of Colombia. Our objective is to consolidate a new gold district
      around the Marmato Mountain in Colombia by:


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§
            Acquiring
                the rights to an historic prospective gold project in Marmato (the
                “Marmato Mountain Development
                Project”);


§
            Acquiring
                certain surrounding properties in the Caramanta region (the “Caramanta
                Exploration Project”); and


§
            Planning
                for and executing the acquisition of additional ancillary
                properties.





Our
      focus
      in fiscal 2007 is to continue to advance the Marmato Mountain Development
      Project towards production through:





§
            The
                acquisition of additional Colombian mineral concessions and mineral
                rights;


§
            Commencing
                the resettlement of the town of
                Marmato;


§
            Commencing
                drilling and sampling programs;


§
            The
                preparation of revised resource estimates;
                and


§
            Commencing
                the preparation of a feasibility
                study





In
      the
      first quarter of fiscal 2007 we advanced our business plan by:





§
            Raising
                approximately $9.0 million to fund our mineral acquisition and exploration
                activities.


§
            Increasing
                our mineral and exploration rights ownership to 96 of 121 mineral
                properties from existing Colombian titleholders in exchange for cash
                consideration of approximately $3.5 million; and


§
            Continuing
                data collection for a baseline study;
                and


§
            Commencing
                drilling and sampling on the Marmato
                Mountain





As
      of
      April 30, 2007, the Zona Alta portion of the Marmato project in Colombia hosts
      approximately 275 total small mines which Compañia Minera de Caldas, S.A.
      (“Caldas”), a 94.99% owned subsidiary of RNC (Colombia) Limited (“RNC”) which we
      presently have a 90% interest in, is seeking to purchase individually.
      Eighty-five (85) of these mines have registered titles in the Ministry of Mines
      in Caldas. We refer to these mines as Category 1. Thirty-six (36) mines are
      located in an area called CHG-081 in which there is one mining
      contract.  We refer to these mines as Category 2. Once all of these
      Category 2 mines have been purchased, Caldas will own the entire CHG-081
      contract.  Our objective is to secure ownership to these one hundred and
      twenty one (121) properties.  Approximately ninety (90) of the remaining
      mines have made applications for legalization under the previous mining law.
      We
      refer to these mines as Category 3.  Of the applications made, management
      believes that less than thirty (30) will be approved.  Approximately
      sixty-four (64) are illegal mines.





Certain
      mining properties have been purchased or optioned and are awaiting final payment
      once the documentation and registration is complete. The total number of legal
      mines acquired by Caldas at April 30, 2007 is 96. Minera de Caldas is also
      purchasing the existing mills on the Zona Alta and has so far purchased 10
      out
      of the total of approximately 26. As the mills are purchased they will be shut
      down and dismantled as part of our plans to deal with any environmental
      concerns. The mines will also be closed except for maintenance to keep the


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tunnels
      open for future sampling and drilling to expedite our test drilling and resource
      estimation.





***Our
      Business***





We
      were
      incorporated under the laws of the State of Nevada, U.S.A., on March 25, 2003
      and changed our name from Secure Automated Enterprises, Inc. to Colombia
      Goldfields Ltd. on May 13, 2005. At that time, we changed our operational focus
      from providing electronic filings services for public access document
      submissions to the U.S. Securities Exchange Commission, to the acquisition
      of,
      exploration for, and development of mineral properties. On July 31, 2006, our
      jurisdiction of incorporation was changed to the state of Delaware.





We
      are
      currently in the exploration stage and our current focus is on the acquisition
      and development of mineral interests in mining properties located in the Marmato
      Mountain Gold District located in Colombia. The disclosure that follows is
      a
      discussion of each of the properties that we have an interest in and our results
      of operations for the three months ended March 31, 2007 and March 31,
      2006.





***Principal
      factors affecting our results of operations***





Our
      consolidated financial statements are prepared in accordance with U.S. generally
      accepted accounting principles, and we maintain our accounts in U.S. Dollars.








We
      believe that the key determinants of our operating and financial results are
      the
      following:





(a)
            The
                state of capital markets, which affects our ability to finance exploration
                activities;





(b)
            The
                valuation of mineral properties as exploration results provide further
                information relating to the underlying reserves of such properties;
                and





(c)
            Prices
                for metals, particularly, gold.





There
      is
      no assurance that commercially exploitable reserves of gold exist on any of
      our
      property interests. In the event that commercially exploitable reserves of
      gold
      exist on any of our property interests, there is no guarantee that we will
      make
      a profit. If we cannot acquire or locate gold deposits, or if it is not
      economical to recover the gold deposits, our business and operations will be
      materially adversely affected.





***Revenues***





We
      have
      not yet completed our economic feasibility studies to establish the existence
      of
      proven or probable reserves for these properties and, as a result, to date
      we
      have not recognized any revenues from mining activities for the period since
      incorporation to March 31, 2007.


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***Expenses***





Our
      primary expenses consist of mineral property rights exploration expenditures
      and
      general and administrative expenses.





***Critical
      accounting policies***





The
      following are the accounting policies that we consider to be Critical Accounting
      Policies *.* Critical
      Accounting Policies are those that are both important to the portrayal our
      financial condition and results and those that require the most difficult,
      subjective, or complex judgments, often as result of the need to make estimates
      about the effect of matters that are subject to a degree of
      uncertainty.





Going
      Concern





We
      incurred a net loss in excess of approximately $10.3 million for the period
      from
      inception on March 23, 2003 to March 31, 2007, and we are not presently
      generating any revenue. Furthermore, we have used in excess of $18 million
      during this period to fund our operations and mineral acquisitions program.
      At
      March 31, 2007, we have a working capital deficiency of approximately $2.1
      million. Our future is dependent upon our ability to obtain additional financing
      and future acquisition, exploration and development of profitable operations
      form our mineral properties. We plan to seek additional financing in private
      and/or public equity offerings to secure funding for our operations. Our
      business plan includes completing the acquisition of the remaining 10% equity
      interest in RNC (Colombia) Limited which may require additional funds of as
      much
      as $15 million on or before May 1, 2009. In addition, we estimate that we
      require at least an additional $15 million to fund our fiscal 2007 operations.
      We currently do not have any arrangements for additional financing. There can
      be
      no assurance that such additional financing will be available to us on
      acceptable terms or at all. These factors, among others, raise substantial
      doubt
      about our ability to continue as a going concern. Our financial statements
      do
      not include any adjustment to reflect the possible future effect on the
      recoverability and classification of the assets or the amounts and
      classification of liabilities that may should we cease to continue as a going
      concern.





Basis
      of Presentation





Entities
      that are controlled by us, either directly or indirectly, are consolidated.
      Control is established by our ability to determine strategic, operating,
      investing and financing policies without the co-operation of others. We analyze
      our level of ownership, voting rights and representation on the board of
      directors in determining if control exists by any one, or a combination of
      these
      factors.





Our
      consolidated financial statements include the accounts of (i) Colombia
      Goldfields Ltd., a Delaware Corporation (ii) Our 90% interest in RNC (Colombia)
      Limited, a Belize corporation and its 94.99% owned subsidiary - Compania Minera
      De Caldas, S.A., a Colombia corporation, iii) Our 94.99% interest in Gavilan
      Minerales, S.A. (“Gavilan”) a Colombia Corporation. All
      significant inter-company transactions and balances are eliminated upon
      consolidation.


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Mineral
      Property Rights Acquisition and Exploration Expenditures





Title
      on
      mineral properties and mining and exploration rights involve certain inherent
      risks due to the difficulties of determining the validity of certain claims
      as
      well as the potential for problems arising from the frequently ambiguous
      conveyance history characteristic of many mining properties. We cannot give
      any
      assurance that title to such properties will not be challenged or impugned
      and
      we cannot be certain that we will have valid title to our mining properties.
      We
      rely on title opinions by legal counsel who base such opinions on the laws
      of
      countries in which we operate.





Our
      mineral property rights acquisition and exploration activities consist
      of





i)  The
      acquisition of mineral concessions;


ii)  The
      acquisition of mineral and exploration rights from existing titleholders;


iii)  The
      exploration of acquired mineral properties and related activities; and


iv)  The
      allocation of stock based compensation related to certain participants in our
      stock
      option plan.





Costs
      of
      acquiring mining properties are capitalized upon acquisition, including interest
      costs attributable to mineral property acquisitions. Mine development costs
      incurred either to develop new ore deposits, expand the capacity of mines,
      or to
      develop mine areas substantially in advance of current production are also
      capitalized once proven and probable reserves exist and the property is a
      commercially mineable property. Costs incurred to maintain current production
      or
      to maintain assets on a standby basis are charged to operations. Costs of
      abandoned projects are charged to operations upon abandonment. We evaluate,
      whenever events or changes in circumstances indicate that their carrying amounts
      may not be recoverable, the carrying value of capitalized mining costs and
      related property, plant and equipment costs, to determine if these costs are
      in
      excess of their net recoverable amount whenever events or changes in
      circumstances indicate that their carrying amounts may not be recoverable.
      The
      periodic evaluation of carrying value of capitalized costs and any related
      property, plant and equipment costs is based upon expected future cash flows
      and/or estimated salvage value in accordance with Statement of Financial
      Accounting Standards (SFAS) No. 144, *Accounting
      for Impairment or Disposal of Long-Lived Assets.*




Asset
      Retirement Obligations





We
      apply
      SFAS No. 143, *Accounting
      for Asset Retirement Obligations* that
      requires that the fair value of a liability for an asset retirement obligation
      be recognized in the period in which it is incurred. SFAS No. 143 requires
      us to
      record a liability for the present value of the estimated site restoration
      costs
      with a corresponding increase to the carrying amount of the related long-lived
      assets. The liability will be accreted until it has been fully incurred, and
      the
      asset will be amortized over the life of the related assets. Adjustments for
      changes resulting from the passage of time and changes to either the timing
      or
      amount of the original present value estimate underlying the obligation will
      be
      made. As at March 31, 2007, and December 31, 2006, we do not have any asset
      retirement obligations.


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Stock-Based
      Compensation





On
      January 1, 2006, we applied SFAS No. 123(R), *Share-Based
      Payment* ,
      to
      account for stock options and similar equity instruments issued. Accordingly,
      compensation expense attributable to stock options or similar equity instruments
      granted are measured at the fair value at the grant date, and recognized over
      the expected vesting period. For all stock option awards granted on or after
      January 1, 2006, we recognized compensation using the fair value method of
      accounting for stock-based compensation. The fair value of stock options is
      estimated at the grant date using the Black-Scholes option pricing model and
      the
      resultant compensation expenses are classified in our consolidated statement
      of
      operations based on the classification of the underlying option plan
      participants’ related compensation expenses. In the event stock options are
      forfeited, any previously recognized compensation expense related to unvested
      and expiring awards is recognized in earnings during the period of forfeiture.
      The majority of our stock based compensation relates to either i) mineral
      exploration activities associated with our exploration personnel or ii) general
      and administrative expenses associated with our administrative employees,
      directors, and consultants.





Although
      the assumptions used to record stock compensation expense reflect management’s
      best estimates, they involve inherent uncertainties based on market conditions
      generally outside of our control. If other assumptions were used, stock-based
      compensation expense could be significantly impacted. As stock options are
      exercised, the proceeds received on exercise, in addition to the previously
      recognized amounts related to those stock options, are credited to stockholders’
equity.





***Selected
      Financial Information***





The
      following table sets forth selected financial information for the three months
      ended March 31, 2007, and 2006. This summary of selected financial information
      is derived from, and should be read in conjunction with, and is qualified in
      its
      entirety by reference to, our audited financial statements and related note
      disclosures.


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**Three
                Months Ended**
              **March
                31, 2007**
            
            **Three
                Months ended**
              **March
                31, 2006**
            
            **Cumulative**
              **from
                Inception**
              **(March
                25, 2003**
              **through**
              **March
                31,****2007****Statement
                of Loss and Deficit**Total
                Expenses
            $
            2,937,870
            
            $
            1,336,791
            
            $
            11,824,328Net
                loss
            
            (2,503,431)
            
            
            (1,333,239)
            
            
            (10,333,078)Loss
                per Share-basic and diluted
            
            (0.04)
            
            
            (0.04)
            
            
            N/A**Balance
                Sheet Data**Total
                Assets
            
            52,708,614
            
            
            45,007,379*
            
            
            52,708,614Total
                Long-Term Debt
            
            -
            
            
            -*
            
            
            -Total
                Liabilities
            
            16,243,759
            
            
            15,797,195*
            
            
            16,243,759Total
                Shareholders’ Equity
            
            36,464,855
            
            
            29,210,184*
            
            
            36,464,855*As
                at December 31, 2006




***Management’s
      Discussion and Analysis***





The
      following discussion and analysis should be read in conjunction with the
      unaudited interim consolidated financial statements of the Corporation for
      the
      three months ended March 31, 2007 and March 31, 2006 and the accompanying notes
      thereto.





***The
      Caramanta and Marmato Projects***





We
      are
      actively advancing two separate projects known as the Marmato Mountain
      Development Project and the Caramanta Exploration Project, both of which are
      located in Colombia’s Marmato Mountain Gold District. These projects are
      separated by approximately seven kilometers and our focus is on securing the
      region between Caramanta and Marmato and any other outlying targets that may
      contain similar mineralization or that have the potential for mining. We have
      advanced our ownership interests in these projects in fiscal 2006 and 2007
      as
      follows:





**(A)
      Caramanta Project**





(i)
      Caramanta Project - concessions 6602, 1343 and 6329





On
      September 22, 2005, we entered into an Assignment Agreement with Investcol
      Limited (“Investcol”) where Investcol assigned, transferred, and conveyed to us
      all of its rights under a contract for Purchase Option of Mining Concessions
      (“Original Option Contract”) entered into with Cia Servicios Y Logisticos Ltda.
      As the result of the Assignment Agreement, we acquired an option to purchase
      certain mining, mineral and exploration rights on property known as


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Concessions
      6602, 1343 and 6329 located in Caramanta Municipality, Antioquia Department,
      Medellin, Colombia for $10,000, on condition that $2,990,000 be invested in
      exploratory work on the property over a three year period. As consideration
      for
      these rights, we issued 1,000,000 restricted shares of common stock to Investcol
      at a deemed fair market value of $ 0.25 per share for total consideration of
      $
      250,000.





Pursuant
      to the Assignment Agreement, we also committed to fund the $2,990,000
      exploratory work as follows:





a)
            $500,000
                upon the closing of the Assignment
                Agreement;


b)
            $750,000
                during the 12 month period commencing June 25, 2006; and on the earlier
                of
                June, 2006 or commencement of the second exploration phase, one million
                restricted shares of our common shares;


c)
            $1,740,000
                during the 12-month period commencing June 25,
                2007.





On
      September 25, 2006 the Assignment Agreement was superseded in connection with
      our agreement to buy the Mining Concessions outright as described in (iii)
      below.





(ii)
      Caramanta Project - concessions 6993,7039,6821 and 6770 and HET 31, 32, 26,
      27
      and, HETG 01





On
      February 16, 2006 we entered into a Letter of Intent “LOI” with Investcol to
      acquire Investcol’s rights in a Contract for Purchase entered into with Cia
      Servicios y Logisticos Ltda. (“Cia Servicios”) The LOI outlined a proposed
      transaction where we intended to acquire Investcol’s rights in certain mining
      contracts to exclusively engage in mining activities on concessions 6993, 7039,
      6821 and 6770 (the “Contracts”) and options that Investcol holds to acquire the
      exclusive rights to engage in mining activities on concessions HET 31, 32,
      26,
      27 and HETG 01 (the “Options”) all located within an area in Colombia referred
      to as the Caramanta location.





The
      LOI
      was non-binding and subject to final negotiation and the execution of a
      definitive agreement. On April 10, 2006, we entered into a definitive agreement
      with Investcol finalizing this transaction (the “Assignment
      Agreement” *)* .
      In
      connection with the Assignment Agreement, we paid Investcol total consideration
      of $350,000 and issued 1,000,000 restricted shares of our common stock. Under
      the terms of the Assignment Agreement, Investcol agreed to pay the exercise
      price of $150,000 on the Options whose titles remained in the name of Cia
      Servicios until the final exploration commitments have been made. The final
      option payments were made prior to July 30, 2006.





On
      September 25, 2006 the Assignment Agreement was superseded in connection with
      our agreement to acquire the Mining Concessions outright as described
      below.





(iii)
      Acquisition of 100% of the Caramanta Exploration Properties





On
      September 25, 2006, we, through the acquisition of the outstanding shares of
      Gavilan Minerales, S.A., (“Gavilan”), acquired full legal title to the Caramanta
      project concessions


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described
      in items A(i) and A(ii) above. Consideration paid for the acquisition included
      $300,000 cash and the issuance of 1,150,000 restricted common shares at a fair
      value of $1.41 per share. In addition, a $50,000 finders fee was paid to
      Investcol. The total acquisition cost of $1,971,500 was allocated to the net
      assets acquired as follows:





Mineral
                and exploration properties and rights
            $
            1,780,841Property,
                plant and equipment
            
            190,659$
            1,971,500





The
      purchase of mineral and exploration properties and rights was recorded as part
      of mineral property rights acquisition and exploration expenditures in fiscal
      2006. As a result of our acquisition of Gavilan, we no longer have any minimum
      exploratory work obligations related to the Caramanta concessions.





**(B)
      Marmato Project**




On
      January 12, 2006, we entered into a Stock Purchase Agreement with Investcol
      and
      RNC (Colombia) Limited (the "Agreement"), whereby we would (i) acquire
      twenty-five percent (25%) of the issued and outstanding stock of RNC (Colombia)
      Limited, a Belize corporation ("RNC") and (ii) hold an option to acquire the
      remaining seventy five percent (75%) of RNC's issued and outstanding stock
      over
      a period of time. RNC is the beneficial holder of 94.99% of the issued and
      outstanding stock of Compania Minera De Caldas, S.A. ("Caldas"), a Colombia
      corporation that (i) owns certain mining, mineral and exploration rights, (ii)
      has options to acquire mining, mineral and exploration rights and (iii) has
      exclusive rights to evaluate certain property, all located in the Zona Alta
      portion of the Marmato project in Colombia.





Pursuant
      to the Stock Purchase Agreement, we:





a)
            Acquired
                25% of the total outstanding shares of RNC by the issuance of 1,000,000
                of
                our common shares to Investcol and the advance to RNC of a $1,200,000
                non-interest bearing loan. We completed the acquisition of 25% of
                RNC by
                the issuance of 1,000,000 shares of our restricted common stock to
                Investcol and the advancement of $1,200,000 by way of a non-interest
                bearing loan to RNC in the second quarter of fiscal 2006;




b)
            Acquired
                an additional 25% of RNC by issuance of 2,000,000 of our common shares
                to
                Investcol and the advance of an additional $4,000,000 non-interest
                bearing
                loan to RNC. We completed the acquisition of the second 25% of RNC
                by the
                issuance to Investcol of 2,000,000 shares of our restricted common
                stock
                and the advancement of $4,000,000 by way of a non-interest bearing
                demand
                loan to RNC in the second quarter of fiscal 2006;





c)
            Held
                the option to acquire an additional 25% of RNC by the issuance of
                4,000,000 of our common shares to Investcol and the advance of an
                additional $15,000,000 non-interest bearing loan to RNC on or before
                October 30, 2006.On
                August 22, 2006, we amended the January 12, 2006 Stock Purchase Agreement
                with Investcol and RNC (Colombia) Limited and concurrently exercised
                our
                option to increase interest in RNC from 50% to 75% in the third quarter
                of
                fiscal 2006. Under the terms of the amended agreement, we issued
                4,200,000


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common
                shares and paid $200,000 to Investcol. In connection with this transaction
                we committed to provide an additional $5,000,000 by way of non-interest
                bearing demand loan to RNC by December 31, 2006 and provide sufficient
                funds to RNC, upon terms satisfactory to the Company, to complete
                a full
                bankable feasibility study of the Marmato Project;
                and




d)
            Held
                the option to acquire the final 25% of RNC for a price equal to the
                25% of
                the value of Caldas determined by a bankable feasibility study prepared
                by
                a certified mineral property evaluator, or other acceptable third
                party.
                The purchase price was payable in either cash or our common shares.
The
                terms of the agreement were amended on August 22, 2006. Under the
                terms of
                the amended agreement, we held the option to acquire the remaining
                25% of
                RNC on or before May 1, 2009 for a purchase price equal to 25% of
                the fair
                value of Caldes, as determined by a forthcoming feasibility study.
                The
                purchase price, pursuant to the amended agreement, was limited to
                a
                maximum of $15,000,000 plus 4,000,000 of our common shares. Payment
                of the
                purchase price could be satisfied in either cash or our common shares,
                or
                any combination thereof.
              
              On
                December 14, 2006, the parties executed a
                Second Amendment to the Stock Purchase Agreement (the “Second Amendment”)
                in order to revise the consideration required to exercise our option
                to
                acquire the remaining 25% of the issued and outstanding stock of
                RNC.
                Subject to the revised terms set forth in the Second Amendment, we
                had the
                option to acquire an additional 15% interest in RNC, in exchange
                for the
                issuance of 4,000,000 common shares to Investcol. In connection with
                the
                execution of the Second Amendment, we exercised our option, resulting
                in
                us acquiring an additional 15% of RNC in exchange for us issuing
                4,000,000
                common shares valued at $5,120,000 in the fourth quarter of fiscal
                2006,
                bringing our total ownership to 90%. The revised terms set forth
                in the
                Second Amendment provide us with the option to acquire the remaining
                10%
                of RNC until May 1, 2009 in exchange for a purchase price of $15,000,000.
                The purchase price can be made in either cash, shares of our common
                stock,
                or any combination thereof.




**(C
      ) The Kedahda Properties**





On
      August
      30, 2006 we purchased, through certain mining exploration properties in the
      Republic of Colombia and the related geochemical and other proprietary
      geological data from a wholly owned subsidiary of Anglo Gold Ashanti, Sociedad
      Kedahda, S.A., for $500,000 cash consideration.




***Results
      of Operations - First Quarter 2007 Compared With First Quarter
      2006.***





For
      the
      three months ended March 31, 2007, we incurred a net loss of $2,503,431 (2006
      -$1,333,239). We generated interest income of $9,729 in the first quarter of
      fiscal 2007 (2006-$3,552). The primary contributors to our net loss were mineral
      property rights acquisition and exploration expenses of $1,472,016 (of which
      $215,125 relates to non-cash stock-based compensation charges) and general
      and
      administrative expenses of $1,447,040 (2006 - $758,724) (of which $350,427
      relates to non-cash stock based compensation charges).





Our
      exploration activities typically involve the following activities and
      expenditures:


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i)
            *The
                acquisition of mineral concessions*:
                To March 31, 2007 this has consisted primarily of payments for the
                assignment contracts and subsequent full legal titles associated
                with the
                Caramanta project, the acquisition of the Marmato project via our
                purchases of RNC (Colombia), and the purchase of the Kedahda properties.
                The concessions we acquire typically exclusively grant to the
                concessionaire the faculty to carry out within the given area, the
                studies, works and installations necessary in order to establish
                the
                existence of the minerals, and to exploit them according to the
                principles, rules and criteria belonging to the accepted techniques
                of
                geology and mining engineering. During the three months ended March
                31,
                2007, we did not acquire any mineral
                concessions.





ii)
            *The
                acquisition of mineral and exploration rights from existing Colombian
                titleholders*.
                This typically involves staged payments to affected landholders and
                related stakeholders. The procedure for payment is normally a payment
                of
                25% of the total negotiated purchase price on signing, 25% of the
                total
                negotiated purchase price when all documentation has been submitted
                to the
                local mining department, and the final 50% payment when the mining
                claim
                has been registered in our name. Satisfactory resolution of local
                landowner or relative concerns is essential to the eventual development
                and operation of modern gold mines on the Marmato project. As at
                April 30,
                2007, we have reached agreements with the titleholders to secure
                96 titles
                deemed desirable in our business plan. During the three months ended
                March
                31, 2007, we expended a total of $3,579,810 on mineral exploration
                rights
                and have obligations at March 31, 2007 to make payments of $5,770,312
                pursuant to amounts owing under our purchase agreements;
                and





iii)
            *The
                evaluation of acquired mineral properties and related
                activities*.
                This typically involves the payment of salaries, wages, and other
                exploration costs in the host country directly attributable to field
                activities furthering our mineral concessions and rights. During
                the three
                months ended March 31, 2007, we expended a total of $1,472,016 on
                the
                exploration of acquired mineral
                properties.





As
      a
      result of our fiscal 2007 efforts to explore and evaluate the Marmato Region,
      our mineral property exploration expenses increased significantly, to $1,472,016
      for the three months ended March 31, 2007 from $572,623 for the three months
      ended March 31, 2006.





General
      and administrative expenses also increased during fiscal 2007, to $1,447,040
      in
      fiscal 2007 from $758,724 in fiscal 2006, reflecting our transition from a
      start-up enterprise to a Company with an active exploration program and
      infrastructure sufficient to support field activities. The primary component
      of
      general and administrative expenses in the first quarter of fiscal 2007 was
      allocated stock based compensation, which totalled $350,427. The remainder,
      consisted primarily of consulting fees paid to directors, officers, and
      shareholders, and expenses related to accounting, legal, investor relations,
      and
      expenses associated with Sarbanes Oxley and other regulatory
      compliance.





The
      increase in our other operating expenses in fiscal 2007, primarily amortization
      expenses, related to the amortization of office equipment, computers, and
      vehicles. For the three months ended March 31, 2007, we incurred a net loss
      of
      $2,503,431 (2006- $1,333,239). The primary


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contributors
      to our net loss were mineral property exploration expenses of $1,447,040, and
      a
      deferred income tax recovery of $424,710 related to deductable temporary
      differences associated with our Colombian subsidiaries.





During
      the first quarter of fiscal 2007, we used cash of $1,825,555 in operations
      (2006-$534,714). The majority of our operating cash requirements consisted
      of
      costs incurred in our Colombian operations, and consulting fees, travel
      expenses, and audit and legal fees related to regulatory compliance. During
      the
      first quarter of fiscal 2007, we issued a total of 9,020,000 common shares
      for
      net proceeds of $8,478,800. We also issued 541,200 warrants to placing agents
      and 650,000 common shares to consultants to the Company for services rendered,
      however no cash was generated from these issuances. During the first three
      months of fiscal 2007, we expended $14,380 on the purchase of capital assets
      and
      $3,579,810 acquiring mineral exploration rights, resulting in a net cash
      increase of $3,059,055 for the three months ended March 31, 2007.





As
      at
      March 31, 2007, we held cash and cash equivalents of $3,941,968. Our working
      capital deficiency of $2,113,349 consisted of i) Cash and cash equivalents
      of
      $3,941,968; ii) Prepaid expenses and deposits of $368,628, consisting primarily
      of advances for mineral and exploration rights and prepaid Marmato exploration
      expenditures; iii) Prepaid consulting fees of $485,000 related to unamortized
      stock-based compensation associated with direct stock awards and iv) Accounts
      payable and accrued liabilities of $6,908,945, consisting primarily of amounts
      owing to Marmato titleholders under our mineral and exploration rights purchase
      agreements. These amounts relate primarily to staged payments owing under our
      agreements to acquire exploration rights from existing Colombian titleholders
      as
      described elsewhere in this MD&A.





***Results
      of Operations - First Quarter 2006 Compared With First Quarter
      2005***





We
      generated interest income of $3,552 for the three months ended March 31, 2006,
      but did not generate any revenue during the reporting period from our current
      operations.





During
      the three months ended March 31, 2005, we generated $763 from our prior business
      plan which was discontinued in the first quarter of 2005 to pursue the
      acquisition and development of mining properties located in the Marmato Mountain
      Gold District located in Colombia.





We
      incurred operating expenses of $1,336,791 for the three months ended March
      31,
      2006, compared to operating costs and expenses of $23,187 for the same three
      month period in the prior year. The increase in our operating expenses for
      the
      three months ended March 31, 2006 when compared to the same reporting period
      in
      the prior year is attributable to expenditures relating to mineral property
      exploration operations under our new business plan and stock based compensation.
      Our expenses for the three months ended March 31, 2006 consisted primarily
      of
      mineral property exploration expenses of $572,623, and general and
      administrative expenses of $758,724.





We
      incurred a net loss of $1,333,239 in the three months ended March 31, 2006,
      as
      compared to a net loss of $22,424 in the three months ended March 31,
      2005.


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***Liquidity
      and Capital Resources***





Our
      cash
      and working capital positions as at the dates indicated were as
      follows:





**March
                31, 2007**
            
            **December
                31, 2006**Cash
                and cash equivalents
            $
            3,941,968
            
            $
            882,913Working
                capital deficiency
            $
            (2,113,349)
            
            $
            (4,978,411)





We
      have
      historically relied on equity capital to fund our operations and mineral
      property acquisition and exploration activities. For the cumulative period
      March
      25, 2003 to March 31, 2007, we raised in excess of $22 million from the issuance
      of common shares and share purchase warrants and used in excess of $18 million
      to fund operations and exploration activities, leaving approximately $4 million
      in cash reserves at March 31, 2007.





In
      order
      to continue to advance our operations while we source additional equity
      financing, on February 27, 2007 we entered into a $3,700,000 promissory note
      with our President, a shareholder, and a company controlled by these
      individuals. The short-term bridge loan, secured by our investment in RNC
      (Colombia) Ltd. was due and payable upon closing of a planned equity financing,
      but in no case later than April 15, 2007. Upon repayment, a $185,000 loan
      origination fee was payable to the note holders. The note accrued interest
      at
      10% per annum, with monthly interest payments commencing February 28, 2007.
      On
      March 21, 2007, we completed a private equity offering of 9,020,000 common
      shares at $1.00 per share. The net proceeds received from the offering were
      $8,478,800. In connection with this private equity offering, we paid as a
      commission $541,200 and issued agents warrants to purchase 541,200 shares of
      our
      common stock with each warrant exercisable for a period of 36 months from the
      closing of the offering at an exercise price of $1.00 per share. On March 26,
      2007, the $3,700,000 loan, including the loan origination fee of $185,000 and
      accrued interest of $45,911, was repaid.  At April 30, 2007, our cash
      reserves were approximately $2 million.





Based
      upon our current financial condition, we anticipate that the current cash on
      hand is insufficient to operate our business through the end of the current
      fiscal year. We intend to fund operations through additional debt and/or equity
      financing arrangements, (which may be insufficient to fund expenditures) or
      other cash requirements. We plan to seek additional financing in a public equity
      offering to secure funding for operations. There can be no assurance that we
      will be successful in raising additional funding. If we are not able to secure
      additional funding, the implementation of our business plan will be impaired
      and
      we may lose our option to purchase certain mining and mineral rights. There
      can
      be no assurance that such additional financing will be available to us on
      acceptable terms or at all.





In
      order
      to finance continuing operations and make payments related to the acquisition
      of
      identified properties and the exercise of our rights to the remaining options
      we
      hold, additional funding will be required from external sources. Management
      estimates that a minimum of $15 million will be required over the next twelve
      months to adequately fund our business plan.


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***Off-balance
      sheet arrangements***





We
      do not
      enter into off-balance sheet arrangements and have no off-balance sheet
      obligations at March 31, 2007.





***Contractual
      obligations***





We
      have a
      two year consulting contract with Mr. J. Randall Martin, our President and
      Chief
      Executive Officer. Under the contract, Mr. Martin is entitled to receive a
      monthly compensation of $10,000, and is eligible to participate in our share
      compensation arrangements. In addition, Mr. Martin is entitled to reimbursement
      of all reasonable out-of-pocket expenses incurred in the performance of his
      duties. If, Mr. Martin’s contract is terminated without cause, he is entitled
      receive a lump sum equal to 12 months monthly compensation. Under the contract,
      Mr. Martin has disclaimed any rights to all intellectual property created by
      him
      or jointly with others while with us. In addition, following termination of
      the
      contract, Mr. Martin will be subject to a one year non-competition
      covenant.





We
      have a
      two year consulting contract with Dr. Stewart Redwood our VP of Exploration.
      Under the contract, Mr. Redwood is entitled to receive compensation at the
      rate
      of $750 per day and is eligible to participate in our share compensation
      arrangements. In addition, he is entitled to reimbursement of all reasonable
      out-of-pocket expenses incurred in the performance of his duties. We also
      granted Dr. Redwood 500,000 restricted shares in the first quarter fiscal 2007.
      Should Dr. Redwood’s contract with us be terminated with cause or by his
      resignation before the period of two years has elapsed, he is required to return
      pro rata portion of the shares based on the time remaining on the contract.





We
      have a
      two year consulting contract with Mr. Ian Park, the President of Caldas. Under
      the contract Mr. Park is entitled to receive monthly compensation of USD $12,500
      and may be entitled to a bonus (subject to board approval) and is eligible
      to
      participate in our share compensation arrangements. In addition, Mr. Park is
      entitled to reimbursement of all reasonable out-of-pocket expenses incurred
      in
      the performance of his duties. Mr. Park can terminate his contract with us
      at
      any time upon 30 days written notice and upon receipt of such notice; we have
      the right to accelerate the termination date. Under the contract, Mr. Park
      has
      disclaimed any rights to all intellectual property created by him or jointly
      with others while with us. In addition, following the termination of the
      contract, Mr. Park will be subject to a one year non-competition
      covenant.





We
      have
      entered into a two year renewable contract with Mr. Thomas Lough. Mr.
      Lough
      is the President and a director of Investcol Limited. We purchased our 90%
      interest and have an option to acquire to remaining 10% interest in
      RNC (Colombia) Limited from
      Investcol Limited. In
      exchange for management services provided by Mr. Lough in connection with our
      Colombian operations, the contract provides for compensation of $800 per day.
      Mr. Lough is also eligible to participate in our share compensation
      arrangements. In addition he is entitled to reimbursement of all reasonable
      out-of-pocket expenses incurred in the performance of his
      duties.


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***Related
      Party Transactions***





Certain
      transactions described under *The
      Caramanta and Marmato Projects* elsewhere
      in this MD&A are considered related party transactions. During certain
      periods we also paid management and consulting fees to directors, senior
      officers and shareholders and for certain prior periods, we paid office rental
      fees to a company related to a former director. Further information on these
      transactions is provided in our accompanying consolidated financial statements
      under Note 8 - “Related Party Transactions”.





***Risks
      and Uncertainties***





**An
      investment in our common stock involves a high degree of risk. You should
      carefully consider the risks described below and the other information in the
      prospectus we filed in connection with our March 21, 2007 private placement
      before investing in our common stock. If any of the following risks occur,
      our
      business, operating results and financial condition could be seriously harmed.**





**We
      need to raise substantial funds in order to acquire additional exploration
      and
      mining properties or interests and commence exploration activities.**




We
      have
      incurred a net loss of approximately $10.3 million for the period from our
      inception on March 25, 2003 to March 31, 2007. As of March 31, 2007, we had
      a
      working capital deficiency of approximately $2.1 million. We presently are
      not
      generating any revenue and do not anticipate that we will generate any revenue
      from operations in the near future. Our business plan includes completing the
      acquisition of the remaining 10% equity interest in RNC (Colombia) Limited,
      which may require additional funds of as much as $15 million on or before May
      1,
      2009. In addition, we estimate that we require at least an additional $15
      million to fund our fiscal 2007 operations. We currently do not have any
      arrangements for financing and we may not be able to obtain financing. If we
      are
      unable to obtain additional financing when sought, we will be required to
      curtail our business plan. Any additional equity financing may involve
      substantial dilution to our then existing shareholders. There is a significant
      risk to investors who purchase shares of our common stock because there is
      a
      risk that we may not be able to generate and/or raise enough resources to remain
      operational for an indefinite period of time.





**Because
      we have only recently commenced our exploration operations, we face a high risk
      of business failure due to our inability to predict the success of our
      business.**




We
      have a
      very limited operating history upon which an evaluation of our future success
      or
      failure can be made. It was only recently that we took steps in a plan to engage
      in the acquisition of interests in exploration and development properties in
      Western Colombia, and it is too early to determine whether such steps will
      lead
      to success. It is premature to evaluate the likelihood that we will be able
      to
      operate our business successfully. To date, we have been involved primarily
      in
      the acquisition of property interests and mining rights in Western Colombia.
      We
      have not earned any revenues from our current operations.


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**Because
      we presently do not carry title insurance and do not plan to secure any in
      the
      future, we are vulnerable to loss of title.**




We
      do not
      maintain insurance against title. Title on mineral properties and mining rights
      involves certain inherent risks due to the difficulties of determining the
      validity of certain claims as well as the potential for problems arising from
      the frequently ambiguous conveyance history characteristic of many mining
      properties. Currently, we are in the process of investigating the title of
      mineral concessions for which we hold either directly or through our equity
      interest in RNC (Colombia) Limited. We cannot give any assurance that title
      to
      such properties will not be challenged or impugned and cannot be certain that
      we
      will have or acquire valid title to these mining properties. For example, there
      is a risk that the Colombian government may in the future grant additional
      titles in excess of the Company’s expectations to currently illegal miners.
      Furthermore, although the Company believes that mechanisms exist to integrate
      the titles of mineral properties currently not owned by the Company, there
      is a
      risk that this process could be time consuming and costly. The Company’s plan to
      move the town of Marmato is subject to the risks inherent in any relocation
      project involving the movement of an established town and its residents to
      a new
      location. The possibility also exists that title to existing properties or
      future prospective properties may be lost due to an omission in the claim of
      title. As a result, any claims against us may result in liabilities we will
      not
      be able to afford resulting in the failure of our business.




**Because
      our property interest and exploration activities in Colombia are subject to
      political, economic and other uncertainties, situations may arise that could
      have a significantly adverse material impact on us.**




Our
      property interests and proposed exploration activities in Western Colombia
      are
      subject to political, economic and other uncertainties, including the risk
      of
      expropriation, nationalization, renegotiation or nullification of existing
      contracts, mining licenses and permits or other agreements, changes in laws
      or
      taxation policies, currency exchange restrictions, changing political conditions
      and international monetary fluctuations. Future government actions concerning
      the economy, taxation, or the operation and regulation of nationally important
      facilities such as mines could have a significant effect on us. Any
      changes in regulations or shifts in political attitudes are beyond our control
      and may adversely affect our business. Exploration may be affected in varying
      degrees by government regulations with respect to restrictions on future
      exploitation and production, price controls, export controls, foreign exchange
      controls, income taxes, expropriation of property, environmental legislation
      and
      mine and/or site safety. No
      assurances can be given that our plans and operations will not be adversely
      affected by future developments in Colombia




**Because
      we are subject to various governmental regulations and environmental risks,
      we
      may incur substantial costs to remain in compliance.**




Our
      operations are subject to Colombian and local laws and regulations regarding
      environmental matters, the abstraction of water, and the discharge of mining
      wastes and materials. Any changes in these laws could affect our operations
      and
      economics. Environmental laws and regulations change frequently, and the
      implementation of new, or the modification of existing, laws or


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regulations
      could harm us. We cannot predict how agencies or courts in Colombia will
      interpret existing laws and regulations or the effect of these adoptions and
      interpretations may have on our business or financial condition. We may be
      required to make significant expenditures to comply with governmental laws
      and
      regulations.




Any
      significant mining operations will have some environmental impact, including
      land and habitat impact, arising from the use of land for mining and related
      activities, and certain impact on water resources near the project sites,
      resulting from water use, rock disposal and drainage run-off. No assurances
      can
      be given that such environmental issues will not have a material adverse effect
      on our operations in the future. Exploration activities may give rise to
      significant liabilities on our part to the government and third parties and
      may
      require us to incur substantial costs of remediation.





Additionally,
      we do not maintain insurance against environmental risks. As a result, any
      claims against us may result in liabilities we will not be able to afford
      resulting in the failure of our business.




**Because
      of the unique difficulties and uncertainties inherent in mineral exploration
      business, we face a high risk of business failure.**




Investors
      should be aware of the difficulties normally encountered by new mineral
      exploration companies and the high rate of failure of such enterprises. Only
      a
      small proportion of the properties that are explored are ultimately developed
      into producing mines. The
      likelihood of success must be considered in light of the problems, expenses,
      difficulties, complications and delays encountered in connection with the
      exploration of the mineral properties that we plan to undertake. Weather
      conditions can increase delays resulting in additional costs and
      expenses. The search for valuable minerals also involves numerous hazards.
      As a result, we may become subject to liability for such hazards, including
      pollution, cave-ins and other hazards for which we cannot insure or for which
      we
      may elect not to insure. At the present time, we have no coverage to insure
      against these hazards. The payment of such liabilities may have a material
      adverse effect on our financial position. In addition, there is no assurance
      that the expenditures to be made by us in the exploration of the mineral claims
      will result in the discovery of commercially exploitable mineral deposits.
      We
      may be forced to revise our exploration program at an increased cost if we
      encounter unusual or unexpected formations. Problems such as unusual or
      unexpected formations and other conditions are involved in mineral exploration
      and often result in unsuccessful exploration efforts.




**Because
      we will be subject to compliance with government regulations which may change,
      the anticipated costs of our exploration program may
      increase.**




We
      have
      and will in the future engage consultants to assist it with respect to our
      operations in Colombia. We are beginning to deal with the various regulatory
      and
      governmental agencies, and the rules and regulations of such agencies, in
      connection with the Marmato and Caramanta properties. No assurances can be
      given
      that we will be successful in our efforts. Further, in order for us to operate
      and grow our business in Colombia, we need to continually conform to the laws,
      rules and regulations of such country and local jurisdictions. It is possible
      that the legal and


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regulatory
      environment pertaining to the exploration and development of gold mining
      properties will change. Uncertainty and new regulations and rules could increase
      our cost of doing business, or prevent us from conducting our business.




**Our
      due diligence activities with respect to our property interests cannot assure
      that these properties will ultimately prove to be commercially
      viable.**




Our
      due
      diligence activities have been limited, and accordingly, no assurances can
      be
      given that the properties or mining rights we possess will contain adequate
      amounts of gold for commercialization. Further, even if we recover gold from
      such mining properties, we cannot guarantee that we will make a profit. If
      we
      cannot acquire or locate commercially exploitable gold deposits, or if it is
      not
      economical to recover the gold deposits, our business and operations will be
      materially adversely affected. At
      present, none of our properties have proven or probable reserves and the
      proposed programs are an exploratory search for proven or probable reserves.
      The
      mining areas presently being assessed by us may not
      contain economically recoverable volumes of minerals or metals. We
      have
      relied, and may continue to rely, upon consultants and others for operating
      expertise.




**In
      the event that we are unable to successfully compete within the mineral
      exploration business, we may not be able to achieve profitable
      operations.**




The
      mineral exploration business is highly competitive. This industry has a
      multitude of competitors and many competitors dominate this industry. Many
      of
      our competitors have greater financial resources than us. As a result, we may
      experience difficulty competing with other businesses when conducting mineral
      exploration activities or in the retention of qualified personnel. No assurances
      can be given that we will be able to compete effectively.




**Due
      to numerous factors beyond our control which could affect the marketability
      of
      gold including the market price for gold, we may have difficulty selling any
      gold if commercially viable deposits are found to exist.**




The
      availability of markets and the volatility of market prices are beyond our
      control and represent a significant risk. Even if commercially viable deposits
      of gold are found to exist on our property interests, a ready market may not
      exist for the sale of the reserves. Numerous factors beyond our control may
      affect the marketability of any substances discovered. These factors include
      market fluctuations, the proximity and capacity of markets and processing
      equipment, government regulations, including regulations relating to prices,
      taxes, royalties, land tenure, land use, importing and exporting of minerals
      and
      environmental protection. These factors could inhibit our ability to sell gold
      in the event that commercial viable deposits are found to
      exist.




**Because
      of the speculative nature of exploration for gold properties, there is
      substantial risk that our business will fail.**




The
      search for gold as a business is extremely risky. We cannot provide any
      assurances that the gold mining interests that we have acquired will contain
      commercially exploitable reserves of gold. Exploration for minerals is a
      speculative venture necessarily involving substantial risk. The


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expenditures
      made and to be made by us in connection with the our interests in the Marmato
      and Caramanta projects, as well as the further exploration of the properties,
      will be substantial and may not result in the discovery of commercially
      exploitable reserves of gold.




**In
      the event that commercially viable deposits are found to exist, there is a
      risk
      that we may not have to requisite resources and expertise to place the property
      into commercial production.**





We
      have
      limited prior experience in placing
      mineral properties into production and our ability to do so will be
      dependent upon us using the services of appropriately experienced personnel
      or
      entering into agreements with other major resource companies that can provide
      such expertise. There can be no assurance that we will have available to us
      the
      necessary expertise when and if it places its resource property into
      production.




**Because
      our success is dependent upon a limited number of people, our business may
      fail
      if those individuals leave the company.**




The
      ability to identify, negotiate and consummate transactions that will benefit
      us
      are dependent upon the efforts of our management team and Investcol. We have
      engaged Investcol to provide support for our management and supervise
      exploration and development activities in Colombia. The loss of the services
      of
      any member of management or the principals of Investcol could have a material
      adverse effect on us. Our planned 2007 drilling activities may require
      significant investment in additional personnel and capital equipment. Given
      the
      current shortage of equipment and experienced personnel within the mining
      industry, there can be no assurance that we will be able to acquire the
      necessary resources.





**If
      we fail to maintain an effective system of internal control, we may be able
      to
      accurately report our financial results or prevent fraud resulting in current
      and potential stockholders losing confidence in our financial
      reporting.**




Effective
      internal controls are necessary for us to provide reliable financials reports
      and effectively prevent fraud. If we cannot provide reliable financial reports
      or prevent fraud, our operating results could be harmed. We have in the past
      discovered, and may in the future discover, areas of our internal controls
      that
      need improvement. Any failure to implement required new or improved controls,
      or
      difficulties encountered in their implementation, could harm our operating
      results or cause us to fail to meet our reporting obligations. Inferior internal
      controls could also cause investors to lose confidence in our reported financial
      information, which could have a negative effect on the trading price of our
      stock.




**New
      legislation, including the Sarbanes-Oxley Act of 2002, may make it more
      difficult for us to retain or attract officers and
      directors.**




The
      Sarbanes-Oxley Act of 2002 was enacted in response to public concerns regarding
      corporate accountability in connection with recent accounting scandals. The
      stated goals of the Sarbanes-


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Oxley
      Act
      are to increase corporate responsibility, to provide for enhanced penalties
      for
      accounting and auditing improprieties at publicly traded companies, and to
      protect investors by improving the accuracy and reliability of corporate
      disclosures pursuant to the securities laws. The Sarbanes-Oxley Act generally
      applies to all companies that file or are required to file periodic reports
      with
      the SEC, under the Securities Exchange Act of 1934. As a public company, we
      are
      required to comply with the Sarbanes-Oxley Act. The enactment of the
      Sarbanes-Oxley Act of 2002 has resulted in a series of rules and regulations
      by
      the SEC that increase responsibilities and liabilities of directors and
      executive officers. The perceived increased personal risk associated with these
      recent changes may deter qualified individuals from accepting these roles.
      As a
      result, it may be more difficult for us to attract and retain qualified persons
      to serve on our board of directors or as executive officers. We are currently
      working towards Sarbanes Oxley 404 compliance, but it is a costly and time
      consuming process and there can be no assurance that we will be compliant within
      the relevant legislation.  We have limited internal and external resources
      to devote to becoming  Sarbanes Oxley 404 compliant by December 31, 2007
      and there can be no assurance we will be compliant by this date.  We
      continue to evaluate and monitor developments with respect to these rules,
      and
      we cannot predict or estimate the amount of additional costs we may incur or
      the
      timing of such costs.





***Recently
      Issued Accounting Standards, Not Yet Adopted***





The
      FASB
      has issued FIN 48, which prescribes rules on the accounting for uncertainty
      in
      income tax positions. FIN 48 requires all material tax positions to undergo
      a
      new two-step recognition and measurement process. All material tax positions
      in
      all jurisdictions in all tax years in which the statute of limitations remains
      open upon the initial date of adoption are required to be assessed. In order
      to
      recognize a tax asset it must be more likely than not a tax position will be
      sustained upon examination based solely on its technical merits. If the
      recognition standard is not satisfied, then no tax benefit otherwise arising
      from the tax position can be recorded for financial statement purposes. If
      the
      recognition standard is satisfied, the amount of tax benefit recorded for
      financial statement purposes will be the largest amount of tax benefit with
      a
      greater than 50% likelihood of being realized upon ultimate settlement with
      a
      taxing authority. FIN 48 is effective for our fiscal 2007 year. The
      implementation of FIN 48 did not have a material impact on our financial
      position, results of the operations, or cash flows for the three months ended
      March 31, 2007.





***Share
      Data***





At
      April
      30, 2007, we have 65,706,849 common shares outstanding. In addition, we have
      outstanding:





i)
            4,152,500
                stock options, each of which is exercisable into one common share;
                and  ii)
            7,431,906 common share purchase warrants, each of
              which
              is exercisable into one common share.





***Fiscal
      2007 Outlook***





We
      have
      been purchasing mineral licenses in the Zona Alta portion of the Marmato project
      since 2005. Our objective is to purchase all of the mineral licenses and then
      consolidate them into a single license. As part of our acquisition program
      at
      the Marmato and Caramanta projects, we have also initiated a review of the
      available geological data for the projects and are in the process


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of
      compiling all information into a comprehensive database. We have identified
      a
      number of immediate exploration targets at both the Marmato and Caramanta
      locations.





Our
      2006
      exploration program consisted of two parts. The first part consisted of
      evaluating the underground mineralization on the Marmato project by channel
      sampling all of the cross-cuts underground to which CGL had access. The second
      part of the program consisted of channel sampling within the various pits
      located at the El Salto prospect and chip sampling outcrops located along the
      creek beds within the Caramanta project. Our 2006 exploration program was
      successful in confirming the nature of the mineralization which previous
      operators encountered during their exploration programs at Marmato. We can
      now
      combine the historical exploration work conducted by the various operators
      with
      the results of our 2006 exploration program to determine further exploration
      targets in the immediate area in fiscal 2007.





With
      the
      Marmato and Caramanta projects, we have acquired a portion of a major historical
      gold producing district in Colombia. At the present time a number of small
      miners are still working the Zona Alta of the Marmato project and Mineros
      Nacionales, a non-affiliated company, is mining the Zona Baja at a rate of
      300t/d. Very little exploration has been conducted in the past within the area
      of the Marmato and Caramanta projects to adequately determine the true extent
      of
      the remaining mineralization. Therefore, the potential economic viability of
      the
      project remains unknown. A number of other targets remain on the Marmato and
      Caramanta projects which intend to explore further at a later date.





As
      a
      result of the 2006 exploration program, we are planning a more comprehensive
      exploration program on the Marmato and Caramanta projects in fiscal 2007. The
      next phase of the exploration program will consist of further chip and channel
      sampling, detailed geological mapping, as well as conducting diamond drilling
      on
      a number of the mineral showings, metallurgical testing, environmental studies,
      a scoping study and resource estimation in addition to further mineral property
      and infrastructure acquisitions.





**Item3.     Controls
      and Procedures**





We
      carried out an evaluation of the effectiveness of the design and operation
      of
      our disclosure controls and procedures (as defined in Exchange Act Rules
      13a-15(e) and 15d-15(e)) as of March 31, 2007. This evaluation was carried
      out
      under the supervision and with the participation of our Chief Executive Officer,
      Mr. J. Randall Martin, and our Chief Financial Officer, Mr. James Kopperson.
      Based upon that evaluation, our Chief Executive Officer and Chief Financial
      Officer concluded that, as of March 31, 2007, our disclosure controls and
      procedures are effective. There have been no changes in our internal controls
      over financial reporting during the quarter ended March 31, 2007.





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


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Executive
      Officer and Chief Financial Officer, to allow timely decisions regarding
      required disclosure.





Limitations
      on the Effectiveness of Internal Controls





Our
      management does not expect that our disclosure controls and procedures or our
      internal control over financial reporting will necessarily prevent all fraud
      and
      material error. Our disclosure controls and procedures are designed to provide
      reasonable assurance of achieving our objectives and our Chief Executive Officer
      and Chief Financial Officer concluded that our disclosure controls and
      procedures are effective at that reasonable assurance level. Further, the design
      of a control system must reflect the fact that there are resource constraints,
      and the benefits of controls must be considered relative to their costs. Because
      of the inherent limitations in all control systems, no evaluation of controls
      can provide absolute assurance that all control issues and instances of fraud,
      if any, within the Company have been detected. These inherent limitations
      include the realities that judgments in decision-making can be faulty, and
      that
      breakdowns can occur because of simple error or mistake. Additionally, controls
      can be circumvented by the individual acts of some persons, by collusion of
      two
      or more people, or by management override of the internal control. The design
      of
      any system of controls also is based in part upon certain assumptions about
      the
      likelihood of future events, and there can be no assurance that any design
      will
      succeed in achieving its stated goals under all potential future conditions.
      Over time, control may become inadequate because of changes in conditions,
      or
      the degree of compliance with the policies or procedures may deteriorate.


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**PART
      II - OTHER INFORMATION**





**Item1.     Legal
      Proceedings**





We
      are
      not a party to any pending legal proceeding. We are not aware of any pending
      legal proceeding to which any of our officers, directors, or any beneficial
      holders of 5% or more of our voting securities are adverse to us or have a
      material interest adverse to us.





**Item2.     Unregistered
      Sales of Equity
      Securities and Use of Proceeds**





The
      information set forth below relates to our issuances of securities without
      registration under the Securities Act during the reporting period which were
      not
      previously included in a Current Report on Form 8-K.





On
      March
      22, 2007, we issued a total of 650,000 shares of restricted common stock to
      two
      consultants for services rendered. These shares were issued pursuant to Section
      4(2) of the Securities Act. We did not engage in any general solicitation of
      advertising. We issued the stock certificate and affixed the appropriate legends
      to the restricted stock.





On
      March
      21, 2007, we completed a private equity offering of 9,020,000 shares of our
      common stock, par value $0.00001, at $1.00 per share. The gross proceeds we
      received from this offering were $ 9,020,000.  In connection with this
      private equity offering, we paid a commission of $541,200 and issued warrants
      to
      purchase 541,200 shares of our common stock with each warrant exercisable for
      a
      period of thirty-six (36) months from the closing of the offering at an exercise
      price of $1.00 per share.





We
      completed this offering pursuant to Regulation S of the Securities Act. 
Each investor represented to us that he was a non-US person as defined in
      Regulation S.  We did not engage in a distribution of this offering in the
      United States.  Each investor represented his intention to acquire the
      securities for investment only and not with a view toward distribution.  We
      requested our stock transfer agent to affix appropriate legends to the stock
      certificate issued to each investor in accordance with Regulation S and the
      transfer agent affixed the appropriate legends.  Each investor was given
      adequate access to sufficient information about us to make an informed
      investment decision.





On
      March
      16, 2007, we granted to two members of our board of directors options to
      purchase a total of 200,000 shares of our common stock at the exercise price
      of
      $1.17 per share with the options vesting completely over two years and
      exercisable for a period of ten years from the date of issuance. These options
      were issued pursuant to Section 4(2) of the Securities Act of 1933, as amended.
      We did not engage in any general solicitation or advertising.





On
      March
      14, 2007, we granted newly appointed directors options to purchase a total
      of
      1,200,000 shares of our common stock at the exercise price of $1.18 per share
      with the options vesting completely over two years and exercisable for a period
      of ten years from the date of


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issuance.
      These options were issued pursuant to Section 4(2) of the Securities Act of
      1933, as amended. We did not engage in any general solicitation or
      advertising.





On
      March
      6, 2007, we granted to four consultants options to purchase a total of 240,000
      shares of our common stock at the exercise price of $1.11 per share with the
      options vesting completely over two years and exercisable for a period of ten
      years from the date of issuance. These options were issued pursuant to Section
      4(2) of the Securities Act of 1933, as amended. We did not engage in any general
      solicitation or advertising.





**Item3.     Defaults
      upon Senior
      Securities**





None





**Item4.     Submission
      of Matters to a Vote
      of Security Holders**





No
      matters have been submitted to our security holders for a vote, through the
      solicitation of proxies or otherwise, during the quarterly period ended March
      31, 2007.





**Item5.     Other
      Information**





None





**Item6.      Exhibits**





**Exhibit
                Number**
            **Description**2.1
            RNC
                Stock Purchase Agreement(1)3.1
            Articles
                of Incorporation, as amended(2)3.2
            By-Laws,
                as amended(2)5.1
            Opinion
                of The Stewart Law Firm, with consent to use10.1
            Consulting
                Agreement with Stewart Redwood(3)10.2
            Assignment
                Agreement with Investcol Limited(4)10.3
            Agreement
                with Investcol Limited(4)10.4
            Assignment
                Agreement with Investcol Limited regarding Concessions 6993, 7039,
                6821,
                and 6770 and options to acquire the exclusive rights to engage in
                mining
                activities on
              Concessions
                HET-31, 32, 26, 27, and HETG-01(5)10.5
            Amendment
                to Agreement with Investcol Limited regarding Concessions 6993, 7039,
                6821, and 6770 and options to acquire the exclusive rights to engage
                in
                mining activities on
              Concessions
                HET-31, 32, 26, 27, and HETG-01(5)10.6
            Contract
                for Purchase of Concessions 6993, 7039, 6821, and 6770 and options
                to
                acquire the exclusive rights to engage in mining activities on Concessions
                HET-31, 32, 26, 27, and HETG-01(5)10.7
            Consulting
                Services Agreement with J. Randall Martin(6)10.8
            Master
                Agreement for Acquisition of properties in Caramanta(7)10.9
            Second
                Amendment to Stock Purchase Agreement(8)


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21.1
            Subsidiaries
                of Small Business Issuer(4)31.1
            Certification
                of Chief Executive Officer pursuant to 18
                U.S.C. Section 1350, as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act of 200231.2
            Certification
                of Chief Financial Officer pursuant to 18
                U.S.C. Section 1350, as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act of 200232.1
            Certification
                of Chief Executive Officer and Chief
                Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
                pursuant
                to Section 906 of the Sarbanes-Oxley Act of
                2002





(1)
            Incorporated
                by reference to Current Report on Form 8-K filed on February 26,
                2006(2)
            Incorporated
                by reference to Registration Statement on Form SB-2 filed on July
                28,
                2006


(3)
            Incorporated
                by reference to Annual Report on Form 10-KSB filed on March 30,
                2007(4)
            Incorporated
                by reference to Current Report on Form 8-K filed on September 28,
                2005(5)
            Incorporated
                by reference to Annual Report on Form 10-KSB filed on April 17,
                2006


(6)
            Incorporated
                by reference to Current Report on Form 8-K filed on August 4,
                2006(7)
            Incorporated
                by reference to Current Report on Form 8-K filed on September 29,
                2006


(8)
            Incorporated
                by reference to Current Report on Form 8-K filed on December 15,
                2006


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**SIGNATURES**





In
      accordance with the requirements of the Securities and Exchange Act of 1934,
      the
      Registrant has duly caused this report to be signed on its behalf by the
      undersigned, thereunto duly authorized.





**Colombia
                Goldfields Ltd.**Date:
            May
                10, 2007By:       /s/ J.
                Randall Martin
              J.
                Randall Martin
              Title:**Chief
                Executive Officer and
                Director**





Date:
            May
                10, 2007By:       /s/
              James Kopperson
              James
                Kopperson
              Title:**Chief
                Financial Officer**