UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549




FORM
10-QSB


(Mark
One)





[X]
            QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the
quarterly period ended December 31, 2007





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




For the
transition period
from  __________________     to  
_________________________





Commission
file number 000-51594





GOLDMOUNTAIN EXPLORATION
CORPORATION


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







Nevada
            98-0455906(State
      or other jurisdiction of
            (IRS
      Employer Identification No.)incorporation
      or organization)





First Canadian Place, 100
King Street West


Suite
5700


Toronto, Ontario, Canada,
M5X 1K7.


(Address
of principal executive offices)





(416)
915-3126


(Registrant's
telephone number)





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





At
February 12, 2008, there were 87,627,167 shares of the Registrant’s common stock
outstanding, which includes 1,980,000 shares which we previously sold pursuant
to Subscription Agreements, which shares have not been issued to date, but which
have been included in the total number of issued and outstanding shares
disclosed throughout this report.





Transitional
Small Business Disclosure Format.  Yes [   ] No
[X]





Indicate
by check mark whether the registrant is a shell company


(as
defined in Rule 12b-2 of the Exchange Act).  Yes [   ] No
[X].












PART I. FINANCIAL
INFORMATION





ITEM
1. FINANCIAL STATEMENTS




The
accompanying unaudited financial statements have been prepared in accordance
with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B, and,
therefore, do not include all information and footnotes necessary for a complete
presentation of financial position, results of operations, cash flows, and
stockholders' equity in conformity with generally accepted accounting
principles. In the opinion of management, all adjustments considered necessary
for a fair presentation of the results of operations and financial position have
been included and all such adjustments are of a normal recurring
nature.




As used
in this Quarterly Report, the terms "we", "us", "our", and “GoldMountain” mean
GoldMountain Exploration Corporation and its subsidiary, unless otherwise
indicated. All dollar amounts in this Quarterly report are in U.S. dollars
unless otherwise stated.

























-2-















GOLDMOUNTAIN
EXPLORATION CORPORATION






(An
Exploration Stage Company)






THIRD
QUARTER CONSOLIDATED FINANCIAL STATEMENTS






DECEMBER
31, 2007






(Unaudited)






(Stated
in U.S. Dollars)














-3-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






CONSOLIDATED
BALANCE SHEETS


(Unaudited)


(Stated
in U.S. Dollars)




DECEMBER
      31, 2007
            
            
            MARCH
      31, 2007(audited)ASSETSCurrentCash
            
            $
            1,849
            
            
            $
            17,096Prepaid
      expenses
            
            
            -
            
            
            
            3,030Total
      Current Assets
            
            
            1,849
            
            
            
            20,126Non-CurrentMineral
      properties
            
            
            1,060,000
            
            
            
            1,060,000TOTAL
      ASSETS
            
            $
            1,061,849
            
            
            $
            1,080,126LIABILITIESCurrentAccounts
      payable and accrued liabilities
            
            $
            68,367
            
            
            $
            29,798STOCKHOLDERS'
      EQUITYShare
      CapitalAuthorized:400,000,000
      common voting shares with a par value of$0.001
      per share100,000,000
      preferred shares with a par value of$0.001
      per shareIssued
      and outstanding:87,377,168
      common shares at December 31, 2007and
      80,657,168 common shares at March 31, 2007
            
            
            87,377
            
            
            
            80,657Additional
      Paid-In Capital
            
            
            4,150,923
            
            
            
            1,713,143Stock
      Subscriptions Received
            
            
            -
            
            
            
            25,000Deficit
      Accumulated During Exploration Stage
            
            
            (3,244,818
            )
            
            
            (768,472
            )Total
      Stockholders' Equity
            
            
            993,482
            
            
            
            1,050,328TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
            
            $
            1,061,849
            
            
            $
            1,080,126




The
accompanying notes are an integral part of these consolidated financial
statements.




-4-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






CONSOLIDATED
STATEMENTS OF OPERATIONS


(Unaudited)


(Stated
in U.S. Dollars)




THREE
      MONTHS ENDED DECEMBER 31, 2007
            
            
            NINE
      MONTHS ENDED DECEMBER 31, 2007
            
            
            THREE
      MONTHS ENDED DECEMBER 31, 2006 (Reclassified)
            
            
            NINE
      MONTHS ENDED DECEMBER 31, 2006 (Reclassified)
            
            
            PERIOD
      FROM INCEPTION NOVEMBER 3, 2004 TO DECEMBER 31, 2007Revenue
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -Operating
      ExpensesConsulting
      fees
            
            
            16,995
            
            
            
            44,740
            
            
            
            15,443
            
            
            
            34,706
            
            
            
            88,402Mineral
      acquisition costs
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            28,627Mineral
      exploration costs
            
            
            -
            
            
            
            476,327
            
            
            
            73,627
            
            
            
            259,522
            
            
            
            867,011Loss
      (gain) on foreign exchange
            
            
            1,762
            
            
            
            7,226
            
            
            
            (377
            )
            
            
            (999
            )
            
            
            6,977Office
      and sundry
            
            
            14,146
            
            
            
            35,877
            
            
            
            19,097
            
            
            
            45,113
            
            
            
            105,677Professional
      fees
            
            
            9,575
            
            
            
            98,176
            
            
            
            45,151
            
            
            
            104,156
            
            
            
            285,124Write
      down of mineralproperty
      interest
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            3,50042,478
            
            
            
            662,346
            
            
            
            152,941
            
            
            
            442,498
            
            
            
            1,385,318Net
      Operating Loss For The Period
            
            
            (42,478
            )
            
            
            (662,346
            )
            
            
            (152,941
            )
            
            
            (442,498
            )
            
            
            (1,385,318
            )Other
      Income (Loss)Stock
      accretion expense
            
            
            (35,000
            )
            
            
            (1,814,000
            )
            
            
            -
            
            
            
            -
            
            
            
            (1,859,500
            )Net
      Loss For The Period
            
            
            (77,478
            )
            
            
            (2,476,346
            )
            
            
            (152,941
            )
            
            
            (442,498
            )
            
            
            (3,244,818
            )Basic
      And Diluted Loss Per Share
            
            $
            -
            
            
            $
            (0.03
            )
            
            $
            (0.01
            )
            
            $
            (0.01
            )Weighted
      Average Number ofCommon
      Shares Outstanding
            
            
            87,214,124
            
            
            
            85,080,428
            
            
            
            79,231,334
            
            
            
            78,684,946




The
accompanying notes are an integral part of these consolidated financial
statements.




-5-


GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






CONSOLIDATED
STATEMENTS OF CASH FLOWS


(Unaudited)


(Stated
in U.S. Dollars)




THREE
      MONTHS ENDED DECEMBER 31, 2007
            
            
            NINE
      MONTHS ENDED DECEMBER 31, 2007
            
            
            THREE
      MONTHS ENDED DECEMBER 31, 2006 (Reclassified)
            
            
            NINE
      MONTHS ENDED DECEMBER 31, 2006 (Reclassified)
            
            
            PERIOD
      FROM INCEPTION NOVEMBER 3, 2004 TO DECEMBER 31, 2007Cash
      provided by (used in)Operating
      ActivitiesNet
      loss for the period
            
            $
            (77,478
            )
            
            $
            (2,476,346
            )
            
            $
            (152,941
            )
            
            $
            (442,498
            )
            
            $
            (3,244,818
            )Item
      not involving cash:Stock
      accretion expense
            
            
            35,000
            
            
            
            1,814,000
            
            
            
            -
            
            
            
            -
            
            
            
            1,859,500Changes
      in non-cash workingcapital
      items:Write
      down of mineralproperty
      interest
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            3,500Prepaid
      expenses
            
            
            -
            
            
            
            3,030
            
            
            
            -
            
            
            
            (3,253
            )
            
            
            -Accounts
      payable andaccrued
      liabilities
            
            
            (18,003
            )
            
            
            38,569
            
            
            
            9,182
            
            
            
            17,145
            
            
            
            68,367(60,481
            )
            
            
            (620,747
            )
            
            
            (143,759
            )
            
            
            (428,606
            )
            
            
            (1,313,451
            )Financing
      ActivityShare
      capital issued for cash
            
            
            50,000
            
            
            
            630,500
            
            
            
            -
            
            
            
            378,800
            
            
            
            1,518,800Share
      subscriptions received
            
            
            -
            
            
            
            (25,000
            )
            
            
            32,565
            
            
            
            255,500
            
            
            
            -50,000
            
            
            
            605,500
            
            
            
            32,565
            
            
            
            634,300
            
            
            
            1,518,800Investing
      ActivityAdditions
      to mineral propertyinterest
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (3,500
            )Acquisition
      of mineral property
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (200,000
            )
            
            
            (200,000
            )-
            
            
            
            -
            
            
            
            -
            
            
            
            (200,000
            )
            
            
            (203,500
            )Increase
      (Decrease) In Cash
            
            
            (10,481
            )
            
            
            (15,247
            )
            
            
            (111,194
            )
            
            
            5,694
            
            
            
            1,849Cash,
      Beginning Of Period
            
            
            12,330
            
            
            
            17,096
            
            
            
            143,681
            
            
            
            26,793
            
            
            
            -Cash,
      End of Period
            
            $
            1,849
            
            
            $
            1,849
            
            
            $
            32,487
            
            
            $
            32,487
            
            
            $
            1,849Non-cash
      investing andfinancing
      activitiesCommon
      stock issued forproperty
      acquisition
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            860,000
            
            
            $
            860,000




Supplemental
      disclosure ofcash
      flow informationCash
      paid during the period for:Interest
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -Income
      taxes
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -




The
accompanying notes are an integral part of these consolidated financial
statements.




-6-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)




CONSOLIDATED
STATEMENT OF STOCKHOLDERS’ EQUITY




PERIOD
FROM NOVEMBER 3, 2004 (INCEPTION) TO DECEMBER 31, 2007


(Unaudited)


(Stated
in U.S. Dollars)




DEFICITCOMMON
      STOCK
            
            
            
            
            
            ACCUMULATEDADDITIONAL
            
            
            STOCK
            
            
            DURING
    THEPAID-IN
            
            
            SUBSCRIPTIONS
            
            
            EXPLORATIONSHARES
            
            
            AMOUNT
            
            
            CAPITAL
            
            
            RECEIVED
            
            
            STAGE
            
            
            TOTALBalance,
      November 3, 2004(Date
      of inception)
            
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -Shares
      issued for cashNovember
      3, 2004 at$0.00025
            
            40,000,000
            
            
            40,000
            
            
            (30,000
            )
            
            -
            
            
            -
            
            
            10,000February
      28, 2005 at$0.0025
            
            35,200,000
            
            
            35,200
            
            
            52,800
            
            
            -
            
            
            -
            
            
            88,000Net
      loss for the period
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (11,314
            )
            
            (11,314
            )Balance,
      March 31, 2005
            
            75,200,000
            
            
            75,200
            
            
            22,800
            
            
            -
            
            
            (11,314
            )
            
            86,686Shares
      issued for cash:April
      14, 2005 at$0.0025
            
            2,400,000
            
            
            2,400
            
            
            3,600
            
            
            -
            
            
            -
            
            
            6,000Net
      loss for the year
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (72,280
            )
            
            (72,280
            )Balance,
      March 31, 2006
            
            77,600,000
            
            
            77,600
            
            
            26,400
            
            
            -
            
            
            (83,594
            )
            
            20,406Shares
      issued for cash:April 21, 2006at
      $0.60
            
            100,000
            
            
            100
            
            
            59,900
            
            
            -
            
            
            -
            
            
            60,000April 28, 2006at
      $0.60
            
            83,334
            
            
            83
            
            
            49,917
            
            
            -
            
            
            -
            
            
            50,000August 1, 2006at
      $0.60
            
            21,000
            
            
            21
            
            
            12,579
            
            
            -
            
            
            -
            
            
            12,600August 1, 2006at
      $0.60
            
            10,000
            
            
            10
            
            
            5,990
            
            
            -
            
            
            -
            
            
            6,000August 1, 2006at
      $0.60
            
            417,000
            
            
            417
            
            
            249,783
            
            
            -
            
            
            -
            
            
            250,200February
      6, 2007at
      $0.60
            
            80,000
            
            
            80
            
            
            47,920
            
            
            -
            
            
            -
            
            
            48,000February
      6, 2007at
      $0.60
            
            345,834
            
            
            346
            
            
            207,154
            
            
            -
            
            
            -
            
            
            207,500March
      19, 2007at
      $0.15
            
            1,000,000
            
            
            1,000
            
            
            149,000
            
            
            -
            
            
            -
            
            
            150,000Shares
      issued for property:May 11, 2006at
      $1.00
            
            500,000
            
            
            500
            
            
            499,500
            
            
            -
            
            
            -
            
            
            500,000September
      12, 2006at
      $0.72
            
            500,000
            
            
            500
            
            
            359,500
            
            
            -
            
            
            -
            
            
            360,000Shares
      subscribed for cash:March
      26, 2007at
      $0.15
            
            
            
            
            -
            
            
            -
            
            
            25,000
            
            
            -
            
            
            25,000Stock
      accretion expense
            
            
            
            
            
            
            
            45,500
            
            
            
            
            
            
            
            
            45,500Net
      loss for the period
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (684,878
            )
            
            (684,878
            )


-7-





Balance,
      March  31, 2007
            
            80,657,168
            
            
            80,657
            
            
            1,713,143
            
            
            25,000
            
            
            (768,472
            )
            
            1,050,328Shares
      issued for cash:May
      18, 2007
            
            166,667
            
            
            167
            
            
            24,833
            
            
            (25,000
            )
            
            -
            
            
            -at
      $0.15May
      22, 2007
            
            100,000
            
            
            100
            
            
            14,900
            
            
            -
            
            
            -
            
            
            15,000at
      $0.15June
      7, 2007
            
            53,333
            
            
            53
            
            
            7,947
            
            
            -
            
            
            -
            
            
            8,000at
      $0.15June
      8, 2007
            
            50,000
            
            
            50
            
            
            7,450
            
            
            -
            
            
            -
            
            
            7,500at
      $0.15July
      20, 2007
            
            150,000
            
            
            150
            
            
            14,850
            
            
            -
            
            
            -
            
            
            15,000at
      $0.20July
      22, 2007
            
            500,000
            
            
            500
            
            
            49,500
            
            
            -
            
            
            -
            
            
            50,000at
      $0.20July
      25, 2007
            
            3,000,000
            
            
            3,000
            
            
            297,000
            
            
            -
            
            
            -
            
            
            300,000at
      $0.20July
      27, 2007
            
            300,000
            
            
            300
            
            
            29,700
            
            
            -
            
            
            -
            
            
            30,000at
      $0.20July
      27, 2007
            
            200,000
            
            
            200
            
            
            19,800
            
            
            -
            
            
            -
            
            
            20,000at
      $0.20August
      8, 2007
            
            1,000,000
            
            
            1,000
            
            
            99,000
            
            
            -
            
            
            -
            
            
            100,000at
      $0.20September
      4, 2007
            
            500,000
            
            
            500
            
            
            49,500
            
            
            -
            
            
            -
            
            
            50,000at
      $0.20September
      4, 2007
            
            200,000
            
            
            200
            
            
            19,800
            
            
            -
            
            
            -
            
            
            20,000at
      $0.20October
      31, 2007
            
            500,000
            
            
            500
            
            
            49,500
            
            
            -
            
            
            -
            
            
            50,000at
      $0.20Stock
      accretion expense
            
            -
            
            
            -
            
            
            1,814,000
            
            
            -
            
            
            -
            
            
            1,814,000Finder’s
      fee
            
            
            
            
            
            
            
            (60,000
            )
            
            
            
            
            
            
            
            (60,000
            )Net
      loss for the period
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (2,476,346
            )
            
            (2,476,346
            )Balance,
      December 31, 2007
            
            87,377,168
            
            $
            87,377
            
            $
            4,150,923
            
            $
            -
            
            $
            (3,244,818
            )
            $
            993,482




The
accompanying notes are an integral part of these consolidated financial
statements.




-8-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)




NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS




DECEMBER
31, 2007


(Unaudited)


(Stated
in U.S. Dollars)






1.
            BASIS
      OF PRESENTATION






The
unaudited consolidated financial information furnished herein reflects all
adjustments which, in the opinion of management, are necessary to fairly state
the Company’s consolidated financial position and the results of its operations
for the periods presented.  These third quarter consolidated financial
statements should be read in conjunction with the Company’s consolidated
financial statements and notes hereto included in the Company’s Form 10-KSB for
the fiscal year ended March 31, 2007.  The Company assumes that the
users of the interim consolidated financial information herein have read, or
have access to, the audited consolidated financial statements for the preceding
fiscal year, and that the adequacy of additional disclosure needed for a fair
presentation may be determined in that context.  Accordingly, footnote
disclosure, which would substantially duplicate the disclosure contained in the
Company’s Form 10-KSB for the fiscal year ended March 31, 2007, has been
omitted.  The results of operations for the nine month period ended
December 31, 2007 are not necessarily indicative for the entire year ending
March 31, 2008.  Certain prior period amounts have been reclassified
to be consistent with current presentation.




Recent
Accounting Pronouncements





In
December 2007, the Financial Accounting Standards Board (“FASB”) issued
Statement of Financial Accounting Standards (“SFAS”) No. 141 (revised
2007), Business
Combinations , which replaces SFAS No 141. The statement retains the
purchase method of accounting for acquisitions, but requires a number of
changes, including changes in the way assets and liabilities are recognized in
the purchase accounting. It also changes the recognition of assets acquired and
liabilities assumed arising from contingencies, requires the capitalization of
in-process research and development at fair value, and requires the expensing of
acquisition-related costs as incurred. SFAS No. 141R is effective for us
beginning April 1, 2009 and will apply prospectively to business
combinations completed on or after that date.





In
December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated Financial Statements, an amendment of ARB 51 , which changes
the accounting and reporting for minority interests. Minority interests will be
recharacterized as noncontrolling interests and will be reported as a component
of equity separate from the parent’s equity, and purchases or sales of equity
interests that do not result in a change in control will be accounted for as
equity transactions. In addition, net income attributable to the noncontrolling
interest will be included in consolidated net income on the face of the income
statement and, upon a loss of control, the interest sold, as well as any
interest retained, will be recorded at fair value with any gain or loss
recognized in earnings. SFAS No. 160 is effective for us beginning
April 1, 2009 and will apply prospectively, except for the presentation and
disclosure requirements, which will apply retrospectively. At this current time,
we do not believe that adoption of SFAS No. 160 would have any effect on
our financial statements.




On
April 1, 2007, we adopted Emerging Issues Task Force Issue No. 06-2
(“EITF 06-2”), Accounting for
Sabbatical Leave and Other Similar Benefits Pursuant to FASB Statement
No. 43 . EITF 06-2 requires companies to accrue the costs of
compensated absences under a sabbatical or similar benefit arrangement over the
requisite service period. As we do not currently have a plan for compensated
absences under a sabbatical or similar benefit arrangement, the adoption of EITF
06-2 had no effect on our financial statements.


-9-





In
February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial
Assets and Financial Liabilities . SFAS No. 159 gives us the
irrevocable option to carry many financial assets and liabilities at fair
values, with changes in fair value recognized in earnings. SFAS No. 159 is
effective for us beginning April 1, 2008, although early adoption is
permitted. We are currently assessing the potential impact that electing fair
value measurement would have on our financial statements and have not determined
what election we will make.





In
September 2006, the FASB issued SFAS No. 157, Fair Value Measurements ,
which defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles, and expands disclosures about fair
value measurements. This statement does not require any new fair value
measurements, but provides guidance on how to measure fair value by providing a
fair value hierarchy used to classify the source of the information. SFAS
No. 157 is effective for us beginning April 1, 2008. In December 2007,
the FASB released a proposed FASB Staff Position (FSP FAS 157-b – Effective Date of FASB Statement
No. 157 ) which, if adopted as proposed, would delay the effective
date of SFAS No. 157 for all nonfinancial assets and nonfinancial
liabilities, except those that are recognized or disclosed at fair value in the
financial statements on a recurring basis (at least annually). We are currently
assessing the potential impact that adoption of this statement would have on our
financial statements.




2.
            NATURE
      AND CONTINUANCE OF OPERATIONS






The
Company was incorporated in the State of Nevada on November 3, 2004 as
Konigsberg Corporation.  On May 16, 2007, The Company changed its name
to GoldMountain Exploration Corporation.  The Company is an
Exploration Stage Company as defined by Statement of Financial Accounting
Standard (“SFAS”) No. 7.  The Company has acquired a mineral property
located in the Nanaimo Mining Division, British Columbia, Canada, and has not
yet determined whether this property contains reserves that are economically
recoverable.  The recoverability of property expenditures will be
dependent upon the discovery of economically recoverable reserves, confirmation
of the Company’s interest in the underlying property, the ability of the Company
to obtain necessary financing to satisfy the expenditure requirements under the
property agreement and upon future profitable productions or proceeds for the
sale thereof.






These
consolidated financial statements have been prepared on a going concern
basis.  The Company has incurred losses since inception resulting in
an accumulated deficit of $3,244,818 since inception and further losses are
anticipated in the development of its business raising substantial doubt about
the Company’s ability to continue as a going concern.  Its ability to
continue as a going concern is dependent upon the ability of the Company to
generate profitable operations in the future and/or to obtain the necessary
financing to meet its obligations and repay its liabilities arising from normal
business operations when they come due.  Management has plans to seek
additional capital through a private placement and public offering of its common
stock.  The consolidated financial statements do not include any
adjustments relating to the recoverability and classification of recorded
assets, or the amounts of and classification of liabilities that might be
necessary in the event the Company cannot continue in existence.






3.
            SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES






The
consolidated financial statements of the Company have been prepared in
accordance with generally accepted accounting principles in the United States of
America.  Because a precise determination of many assets and
liabilities is dependent upon future events, the preparation of consolidated
financial statements for a period necessarily involves the use of estimates
which have been made using careful judgment.  Actual results may vary
from these estimates.




-10-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS






DECEMBER
31, 2007


(Unaudited)


(Stated
in U.S. Dollars)






3.
            SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES
(continued)






The
consolidated financial statements have, in management’s opinion, been properly
prepared within reasonable limits of materiality and within the framework of the
significant accounting policies summarized below:






a)
            Consolidation






These
consolidated financial statements include the accounts of the Company and its
wholly owned British Columbia subsidiary, Konigsberg Explorations
Inc.  All significant intercompany transactions have been
eliminated.






b)
            Exploration
      Stage Enterprise






The
Company’s financial statements are prepared using the accrual method of
accounting and according to the provisions of Statement of Financial Accounting
Standards No. 7 (“SFAS 7”), “Accounting and Reporting for Development Stage
Enterprises,” as it devotes substantially all of its efforts to acquiring and
exploring mineral properties.  Until such properties are acquired and
developed, the Company will continue to prepare its consolidated financial
statements and related disclosures in accordance with entities in the
exploration stage.






c)
            Basis
      of Presentation






These
financial statements and related notes are presented in accordance with
accounting principles generally accepted in the United States, and are expressed
in US dollars.






d)
            Use
      of Estimates and Assumptions






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






e)
            Mineral
      Property Acquisition Payments and Exploration
  Costs






The
Company capitalizes acquisition and option costs of mineral property rights
where the Company believes the properties contain potentially mineralized
material.  The amount capitalized represents fair value at the time
the mineral rights were acquired.  The accumulated costs of
acquisition for properties that are developed to the stage of commercial
production will be amortized using the unit-of-production method.




-11-




Management
periodically reviews the carrying value of its investment in mineral leases and
claims with internal and external mining related professionals.  A
decision to abandon, reduce or expand a specific project is based upon many
factors including general and specific assessments of mineral deposits,
anticipated future mineral prices, anticipated future costs of exploring,
developing and operating a production mine, the expiration term and ongoing
expense of maintaining mineral properties and the general likelihood that the
Company will continue exploration on such project.  The Company does
not set a pre-determined holding period for properties with unproven deposits,
however, properties which have not demonstrated suitable metal concentrations at
the conclusion of each phase of an exploration program are re-evaluated to
determine if future exploration is warranted, whether there has been any
impairment in value and that their carrying values are appropriate.











-12-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS






DECEMBER
31, 2007


(Unaudited)


(Stated
in U.S. Dollars)






3.
            SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES
(continued)






If an
area of interest is abandoned or it is determined that its carrying value cannot
be supported by future productions or sale, the related costs are charged
against operations in the year of abandonment or determination of
value.  The amounts recorded as mineral leases and claims represent
costs to date and do not necessarily reflect present or future
values.






Mineral
exploration costs are expensed as incurred.




The
Company’s exploration activities and proposed mine development are subject to
various laws and regulations governing the protection of the
environment.  These laws are continually changing, generally becoming
more restrictive.  The Company has made, and expects to make in the
future, expenditures to comply with such laws and regulations.




Asset
Impairment




Long-lived
assets are tested for recoverability whenever events or changes in circumstances
indicate the carrying amount may not be recoverable, pursuant to guidance
established in Statement of Financial Accounting Standards No. 144 (“SFAS 144”),
“Accounting for the Impairment or Disposal of Long-lived Assets”.  The
Company determines impairment by comparing the undiscounted future cash flows
estimated to be generated by its assets to their respective carrying
amounts.  If impairment is deemed to exist, the assets will be written
down to fair value.




f)
            Basic
      and Diluted Net Income (Loss) Per
Share






The
Company computes net income (loss) per share in accordance with FASB Statement
of Financial Accounting Standards (“SFAS”) No. 128, “Earnings per
Share”.  SFAS No. 128 requires presentation of both basic and diluted
earnings per share (EPS) on the face of the income statement.  Basic
EPS is computed by dividing net income (loss) available to common shareholders
(numerator) by the weighted average number of shares outstanding (denominator)
during the period.  Diluted EPS give effect to all dilutive potential
common shares outstanding during the period using the treasury stock method and
convertible preferred stock using the converted method.  In computing
Diluted EPS, the average stock price for the period is used in determining the
number of shares assumed to be purchased from the exercise of stock options or
warrants.  Diluted EPS excludes all dilutive potential shares if their
effect is anti dilutive.






g)
            Financial
      Instruments






The
carrying value of cash and accounts payable and accrued liabilities approximate
their fair value because of the short maturity of these
instruments.  The Company’s operations are in Canada and virtually all
of its assets and liabilities are giving rise to significant exposure to market
risks from changes in foreign currency rates.  The Company’s financial
risk is the risk to the
Company’s operations that arise from fluctuations in foreign exchange rates and
the degree of volatility of these rates.  Currently, the Company does
not use derivative instruments to reduce its exposure to foreign currency
risk.




-13-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS






DECEMBER
31, 2007


(Unaudited)


(Stated
in U.S. Dollars)






3.
            SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES
(continued)






h)
            Income
      Taxes






The
Company uses the asset and liability method of accounting for income taxes in
accordance with SFAS No. 109 – “Accounting for Income Taxes”.  This
standard requires the use of an asset and liability approach for financial
accounting and reporting on income taxes.  If it is more likely than
not that some portion of all of a deferred tax asset will not be realized, a
valuation allowance is recognized.






i)
            Foreign
      Currency Translation






The
Company’s functional and reporting currency is the United States
dollar.  Transactions in Canadian dollars are restated in US dollars
as follows:






i.
            Monetary
      items at the rate prevailing at the balance sheet
  date;






ii.
            Non-monetary
      items at the rate historical exchange
rate;






iii.
            Revenue
      and expense at the average rate in effect during the applicable accounting
      period.






Gains and
losses on restatement are recorded in the Statement of Operations.






j)      Environmental
Costs






Environmental
expenditures that relate 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 earliest of completion of a feasibility study
or the Company’s commitments to plan of action based on the then known
facts.






k)
            Asset
      Retirement Obligations






The
Company has adopted Statement of Financial Accounting Standards No. 143 (“SFAS
143”), “Accounting for Asset Retirement Obligations”, which requires that asset
retirement obligations (“ARO”) associated with the retirement of a tangible
long-lived asset, including natural gas and oil properties, be recognized as
liabilities in the period in which it is incurred and becomes determinable, with
an offsetting increase in the carrying amount of the associated assets. The cost
of tangible long-lived assets, including the initially recognized ARO, is
depleted, such that the cost of the ARO is recognized over the useful life of
the assets. The ARO is recorded at fair value. The fair value of the ARO is
measured using expected future cash flow, discounted at the Company’s
credit-adjusted risk-free interest rate.




-14-






GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS






DECEMBER
31, 2007


(Unaudited)


(Stated
in U.S. Dollars)






4.
            MINERAL
      PROPERTIES






Yoquivo
Properties






On May
31, 2006, the Company entered into an option agreement with Sydney Resource
Corporation (“Sydney”), whereby the Company was granted an option to acquire up
to 75% undivided right, title and interest in and to a series of six mineral
concessions located in the State of Sonora, Mexico, and collectively referred to
as the “Yoquivo Property”.  Pursuant to the agreement the Company
exercised the option by adhering to the terms of the option agreement to acquire
an undivided 50% right, title and interest in the “Yoquivo Property” by
investing an amount of $200,000 in cash and issuing 500,000 shares of common
shares.  These shares were valued at $1.00 per share in accordance
with the fair market value of the stock on the date of issuance.  The
Company has the following commitments in the terms and conditions of the option
agreement:






i)
            Issuing
      an additional 500,000 shares of the Company’s common stock to Sydney
      within 12 months upon signing the letter of intent dated April 10, 2006,
      which were issued in September 2006 and priced in accordance with the fair
      market value of the stock on the date of
  issuance;






ii)
            Completing
      the following cumulative exploration expenditures totaling $1,850,000 over
      24 months as defined below:






1.
            Incurring
      $250,000 in cumulative exploration expenditures on the Property within 6
      months of the date of the option
agreement;






2.
            Incurring
      $600,000 in cumulative exploration expenditures on the Yoquivo Property
      within 12 months of the date of the option
  agreement;






3.
            Incurring
      $1,000,000 in cumulative exploration expenditures on the Yoquivo Property
      within 24 months of the date of the option
  agreement.






The
exploration expenditure referred to in ii.1 is a binding commitment whereas all
the other terms are required to keep the option agreement in good
standing.






Upon the
Company successfully exercising the first option by completing the terms and
commitments of the agreement, the Company will then be granted a second option
(“the second option”) to acquire an additional 25% interest in the Yoquivo
Property by completing the following:






i)
            Within
      60 days of having vested the initial 50% interest, making a cash payment
      in favor of Sydney of $250,000;






ii)
            Within
      60 days of having vested the initial 50% interest, issuing a total of
      1,000,000 shares of the Company’s common stock to
  Sydney;






iii)
            Within
      24 months of having vested the initial 50% interest, incurring an
      additional $1,500,000 in exploration expenditures on the Yoquivo
      Property.




-15-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS






DECEMBER
31, 2007


(Unaudited)


(Stated
in U.S. Dollars)






4.
            MINERAL
      PROPERTIES (continued)






Should
the Company successfully exercise the second option to acquire the additional
25% in the Yoquivo Property, Sydney shall have a one-time right, exercisable
within 90 days of the Company having vested at 75%, to back into a 50% interest
in the Yoquivo Property by making a single cash payment to the
Company.  The cash payment will be equal to the greater
of:






i)
            Two
      times the Company’s cumulative exploration expenditures incurred under the
      terms of the second option, exclusive of acquisition payments;
      and






ii)
            Should
      the value of the Company’s shares issued under the terms of the second
      options exceed $1,500,000 on the date of exercise of the back in right, a
      total of two times the Company’s cumulative exploration expenditures
      incurred under the terms of the second option, exclusive of acquisition
      payments, plus one-half of the amount by which the value attributable to
      the Company’s shares exceeds
$1,500,000.






The
Company shall have the additional right, exercisable within 7 days of receipt of
notice of Sydney’s decision to exercise its back in right, to extinguish said
right through the issuance of an additional 1,000,000 shares of its common stock
in Sydney’s favor.






On
September 18, 2006 Sydney Resource Corporation merged with Band-Ore
Resources.  The merged company is known as West Timmins Mining
Inc.  The terms of and conditions of the letter of intent dated April
10, 2006 and the option agreement dated May 31, 2006 remain in
effect.






5.
            SHARE
      CAPITAL






On July
20, 2007, the Company received $15,000 for 150,000 common shares.






On July
22, 2007, the Company received $50,000 for 500,000 common shares.






On July
25, 2007, the Company received $300,000 for 3,000,000 common
shares.






On July
27, 2007, the Company received $30,000 for 300,000 common shares.






On July
27, 2007, the Company received $20,000 for 200,000 common shares.






On August
8, 2007, the Company received $100,000 for 1,000,000 common shares.






On
September 4, 2007, the Company received $50,000 for 500,000 common
shares.






On
September 4, 2007, the Company received $20,000 for 200,000 common
shares.






On
October 31, 2007, the Company received $50,000 for 500,000 common
shares






Each of
the above common share issuance were issued with one (1) Class A Warrant with an
exercise price of $0.15 per share and with one (1) Class B warrant with an
exercise price of $0.30 per share.  The Class A warrants expire one
(1) year from the date of issuance of the common shares listed above and the
Class B warrants expire two (2) years from the date of issuance of the common
shares as indicated above.




-16-




GOLDMOUNTAIN
EXPLORATION CORPORATION


(An
Exploration Stage Company)






NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS






DECEMBER
31, 2007


(Unaudited)


(Stated
in U.S. Dollars)






6.
            WARRANTS







The
following is a summary of the warrant activity during the quarter ended December
31, 2007:





Three
      Months Ended
            
            
            Nine
      Months EndedDecember
      31, 2007
            
            
            December
      31, 2007Number
            
            
            Average
            
            
            Number
            
            
            AverageOf
            
            
            Exercise
            
            
            Of
            
            
            ExerciseWarrants
            
            
            Price
            
            
            Warrants
            
            
            PriceOutstanding,
      beginning of period
            
            
            13,069,999
            
            
            $
            0.222
            
            
            
            1,000,000
            
            
            $
            0.20Granted
            
            
            1,000,000
            
            
            
            0.225
            
            
            
            13,069,999
            
            
            
            0.224Exercised
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Expired
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Outstanding,
      end of period
            
            
            14,069,999
            
            
            $
            0.224
            
            
            
            14,069,999
            
            
            $
            0.212





Compensation
costs attributable to the issuance of share purchase warrants to employees,
directors or consultants, is measured at fair value at the date of issuance of
the warrant and expensed with a corresponding increase to Additional Paid-In
Capital at the time of issuance of the warrants.  Upon exercise of the
warrant, consideration paid by the warrant holder is recorded as an increase to
share capital and Additional Paid-In Capital.





During
the quarter, the Company granted an aggregate of 1,000,000 warrants as a result
of the private placements completed.  The total fair value of the
1,000,000 warrants granted based on the Black-Scholes option pricing model was
$35,000.  Since the warrants vested immediately the Company recognized
$35,000 as stock accretion expense in respect of these grants.





The
weighted average assumptions used in calculating the fair value of warrants
granted during the quarter ended December 31, 2007 using the Black-Scholes
option pricing model are as follows:





2007Risk-free
      interest rate
            4.34%Expected
      life of the warrant
            1.5
      yearsExpected
      volatility
            165.10%Expected
      dividend yield
            -




-17-


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




CERTAIN
STATEMENTS IN THIS QUARTERLY REPORT ON FORM 10-QSB (THIS "FORM 10-QSB"),
CONSTITUTE "FORWARD LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE
SECURITIES ACT OF 1934, AS AMENDED, AND THE PRIVATE SECURITIES LITIGATION REFORM
ACT OF 1995 (COLLECTIVELY, THE "REFORM ACT"). CERTAIN, BUT NOT NECESSARILY ALL,
OF SUCH FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF
FORWARD-LOOKING TERMINOLOGY SUCH AS "BELIEVES", "EXPECTS", "MAY", "SHOULD", OR
"ANTICIPATES", OR THE NEGATIVE THEREOF OR OTHER VARIATIONS THEREON OR COMPARABLE
TERMINOLOGY, OR BY DISCUSSIONS OF STRATEGY THAT INVOLVE RISKS AND UNCERTAINTIES.
SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES
AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE OR
ACHIEVEMENTS OF GOLDMOUNTAIN EXPLORATION CORPORATION ("GOLDMOUNTAIN", "THE
COMPANY", "WE", "US" OR "OUR") TO BE MATERIALLY DIFFERENT FROM ANY FUTURE
RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH
FORWARD-LOOKING STATEMENTS. REFERENCES IN THIS FORM 10-QSB, UNLESS ANOTHER DATE
IS STATED, ARE TO DECEMBER 31, 2007.





BUSINESS
HISTORY





We were
incorporated in Nevada on November 3, 2004, as Konigsberg Corporation, however
we subsequently changed our name to GoldMountain Exploration Corporation, as
described below.





Stock Purchase
Agreement





On March
27, 2006, our then Chief Executive Officer and Sole Director, Susan Downing,
entered into a Stock Purchase Agreement (the "Purchase Agreement") with Adam
Cegielski, who up until that time had not been affiliated with us. Pursuant to
the Purchase Agreement, Mr. Cegielski purchased forty million (40,000,000)
shares of our common stock from Ms. Downing for aggregate consideration of
$30,000. The Purchase Agreement closed on March 27, 2006 (the
"Closing").





As a
result of the Closing, Mr. Cegielski obtained majority voting control over the
Company, as the 40,000,000 shares which he purchased constituted 51.5% of the
Company's then outstanding shares of common stock based on 77,600,000 shares of
common stock outstanding as of March 27, 2006 (the "Change in
Control").





In
connection with the Change of Control of the Company, the Company's then Chief
Executive Officer, President, Principal Accounting Officer, Treasurer and
Secretary, Susan Downing, resigned on March 27, 2006, and Mr. Cegielski was
appointed as the Company's Chief Executive Officer, President, Principal
Accounting Officer, Treasurer and Secretary.





Additionally,
on March 27, 2006, Ms. Downing resigned as the Company's sole Director and Mr.
Cegielski was appointed as the Company's sole Director by the Company's majority
shareholders, to fill the vacancy left by Ms. Downing's
resignation.





Forward Stock
Split





On April
12, 2006, our Board of Directors approved a 4:1 forward stock split to
shareholders of record as of April 25, 2006 (the "Forward Stock Split"). The
Forward Stock Split affected our issued and outstanding, as well as our
authorized shares of common stock, and as a result, after the Forward Stock
Split, we had 400,000,000 shares of common stock authorized with a par value of
$0.001 per share.


-18-


On April
17, 2006, we filed a Certificate of Change Pursuant to Nevada Revised Statutes
78.209 ("Certificate") to our Articles of Incorporation with the Secretary of
State of Nevada, which became effective April 25, 2006, to affect the Forward
Stock Split.  Subsequent to the filing of the Certificate, we filed a
Certificate of Correction ("Correction") with the Secretary of State of Nevada,
to correct the Certificate, which Correction clarified that our 100,000,000
shares of authorized preferred stock, $0.001 par value, were not affected by the
forward stock split.





As a
result of the filing of the Certificate and Correction thereto, we now have
400,000,000 shares of common stock authorized, $0.001 par value, and 100,000,000
shares of preferred stock authorized, $0.001 par value per share. Unless
otherwise stated, all shares amounts used in this 10-QSB are reflected in post
Forward Stock Split amounts.





Name
Change





At our
annual meeting of shareholders held on May 10, 2007, our Chief Executive
Officer, Director and majority shareholder, Adam Cegielski, re-elected himself
as a Director of the Company, ratified the appointment of Telford Sadovnick,
P.L.L.C., as our Certified Public Accountant for the 2007 fiscal year, and
approved the filing of a Certificate of Amendment to our Articles of
Incorporation with the Secretary of State of Nevada to change our name to
“GoldMountain Exploration Corporation” (the “Amendment”).





Mr.
Cegielski, held 40,000,000 shares of our common stock, representing 50.2% of our
outstanding common stock as of the record date of the annual meeting, March 29,
2007 (the “Record Date”), based on 79,657,168 shares of common stock outstanding
as of the Record Date. Notice of the annual meeting was sent to all shareholders
of record as of the Record Date on or about April 9, 2007.





On May
16, 2007, we filed the Amendment with the Secretary of State of Nevada, which
Amendment became effective immediately with the State of Nevada, but which
effectiveness was delayed by approximately ten (10) days due to our requirement
to provide NASD notice of our name change. As a result, our name change to
GoldMountain Exploration Corporation became effective with the Over-The-Counter
Bulletin Board on May 29, 2007, when our trading symbol changed to
“GMEX.”





The
Company maintains a website at www.GoldMountainCorp.com, which includes
information that the Company does not desire to be incorporated by reference
into this filing.





Our
common stock currently trades on the Over-The-Counter Bulletin Board under the
symbol “GMEX” and on the Frankfurt exchange under the symbol
“F2B.F”.





BUSINESS
OPERATIONS





We are an
exploration stage company engaged in the acquisition and exploration of mineral
properties. We currently plan to focus solely on our joint venture in connection
with exploration and development activities in the "Yoquivo Property," which we
have entered into an Option Agreement in connection with, as described
below.





Option
Agreement





On April
13, 2006, we entered into a letter of intent with a wholly owned subsidiary of
Sydney Resource Corporation ("Sydney") to earn up to a 75% joint venture
interest in the Yoquivo Au-Ag property located in Sonora, Mexico (the "Yoquivo
Property" and the "Letter of Intent"). The Yoquivo Property represents
approximately 7,000 acres of land. Sydney merged with Band-Ore Resources Ltd. in
September 2006, and is now known as West Timmins Mining, Inc. (TSX-WTM) ("West
Timmins").


-19-


On May
31, 2006, we and West Timmins (at that time still known as Sydney) entered into
an Option Agreement regarding our ability to earn up to a 75% interest in the
joint venture interest in the Yoquivo Property (the "Option Agreement" and the
“Option”).




Pursuant
to the Option Agreement, West Timmins granted us the right to earn an initial
(First Option) undivided 50% interest in and to the mineral rights to the
Yoquivo Property in exchange for the following cash, share and work expenditure
considerations to be delivered/met over a 24 month period from the signing of
the letter of intent, as more specifically detailed below:





A.
            Our
      making, in favor of West Timmins, the following cash payments totaling
      $200,000 dollars over a 90 day
period:





i)
            $25,000
      within five days of signing of the Letter of Intent, which we have paid as
      of the date of this filing,ii)
            an
      additional $75,000 within 30 days of signing the Letter of Intent, which
      we have paid as of the date of this filing, andiii)
            an
      additional $100,000 within 90 days of signing the Option Agreement, which
      we have paid to date.





B.
            Our
      issuing 1,000,000 shares of restricted common
  stock:





i)
            500,000
      shares of common stock within 30 days of signing the Letter of Intent,
      which we have issued as of the date of this filing, andii)
            An
      additional 500,000 shares of common stock within 12 months of signing of
      the Letter of Intent, which shares have been issued as of the date of this
      filing.





C.
            Our
      completing the following cumulative exploration expenditures on the
      Yoquivo Property totaling $1,000,000 over a 24 month period,
      including:





i)
            $250,000 in cumulative exploration expenditures within the first 6 months
      after signing the Letter of Intent, which amount has been paid to
      date;ii)
            $600,000 in cumulative exploration expenditures within 12 months of
      signing the Letter of Intent, which date was extended until June 30, 2007,
      pursuant to the Second Extension Letter, described below, which payments
      were paid as of July 28, 2007; andiii)
            $1,000,000
      in cumulative exploration expenditures within 24 months of signing the
      Letter of Intent, of which, we have paid $600,000 as of the date of this
      filing





On
January 29, 2007, due to delays in the drilling program, West Timmins sent us a
letter extending the date we were required to complete the $250,000 funding (as
described above under Section C(i)), to February 28, 2007, due to certain delays
in connection with the exploration of the Yoquivo Property (the “First Extension
Letter”). The $250,000 in funding due by the revised February 28, 2007 date was
subsequently paid to West Timmins and we did not default under our obligations
under Section C(i) of the Option Agreement.





On May
31, 2007, due to the slow pace of the drilling program, West Timmins sent us
another letter extending the date we were required to complete the $600,000 in
cumulative funding by (as described above under Section C(ii) above), to June
30, 2007 (the “Second Extension Letter”).


-20-


We were
required to pay at least an additional approximately $325,000 towards
exploration expenditures by June 30, 2007 (for a total of
$600,000).  Those payments were made to West Timmins on or around July
28, 2007, and as such, we do not believe that we are in default of the Option
Agreement.  We have made no additional payments to West Timmins in
connection with the Option Agreement as of the date of this filing; however, we
did pay West Timmons $150,000 subsequent to July 28, 2007 to maintain the
Property in good standing, which amount does not decrease the total amount of
exploration expenses we are required to pay West Timmins.





West
Timmins will act as operator during the earn-in phase of the agreement and will
be entitled to charge a management fee of 10% on all property exploration
expenditures and related head office overhead. The Joint Venture is currently
being managed by a management committee consisting of three individuals, two of
which are affiliated with West Timmins and our Chief Executive Officer and
Director, Adam Cegielski. As operator, West Timmins will be responsible for
proposal of exploration programs to the management committee. We as funding
partner are responsible for funding, in full, any and all exploration programs
approved by the management committee in advance of the commencement of
exploration, as well as being responsible for making all necessary property and
tax payments to keep the property in good standing.




West
Timmins agreed to grant us a second option (the Second Option) pursuant to the
Option Agreement, to earn an additional 25% interest in the joint venture (for
75% total), subject to back-in provisions in favor of West Timmins as indicated
below, under the following terms and conditions:





A.
            Within
      60 days of having vested an initial 50% interest in the property, making a
      cash payment in favor of West Timmins of $250,000
  dollars,B.
            Within
      60 days of having vested an initial 50% interest in the property, issuing
      to West Timmins an additional 1,000,000 common shares,
  andC.
            Completing
      an additional $1,500,000 in exploration expenditures on the property
      within an additional 24 month period and making the necessary cash
      payments to any vendor as per the terms and conditions of the underlying
      agreement.





However,
should we successfully exercise the Second Option, West Timmins has the one-time
right, exercisable within 90 days of us having vested all 75% of the joint
venture, via the Second Option, to back into a 50% interest (the "Back In
Right") in the property by making a single cash payment to us equal to the
greater of:





i)
            2.0
      times our cumulative exploration expenditures incurred under the terms of
      the Second Option, exclusive of acquisition payments;
orii)
            Should
      the value of our shares issued under the terms of the Second Option exceed
      $1,500,000 on the date of the exercise of the Back In Right, a total of
      2.0 times our cumulative exploration expenditures incurred under the terms
      of the Second Option, exclusive of acquisition costs, plus one half of the
      amount by which our shares exceed
$1,500,000.




Finally,
we have the additional right, exercisable within 7 days of receipt of notice of
West Timmins' decision to exercise its Back In Right, to extinguish West
Timmins' Back In Right, through the issuance of an additional 1,000,000 shares
of our common stock to West Timmins.





In the
event that we do not exercise our Second Option and/or act to extinguish West
Timmins' Back In Right, it is anticipated that a joint venture will be formed
between the parties under an industry standard joint venture agreement, with
each party owning and paying expenses on a pro-rata basis based on their then
ownership of the joint venture.


-21-


The
Option Agreement also provides that the joint venture agreement will include a
provision whereby in the event that the joint venture interest of either party
is diluted to a 10% working interest in accordance with the terms of the joint
venture agreement, the diluted party shall revert to a 2.0% net smelter royalty
on the party, which is to be subject to an exclusive and irrevocable option held
by the non-diluted party to purchase such 2.0% net smelter royalty (i.e. 1.0%)
for a sum of $2.0 million.





Development
Activities in The Yoquivo Property





We agreed
pursuant to the Option Agreement to expend $1,000,000 in cumulative exploration
activities on the Yoquivo Property over a twenty-four (24) month period, of
which approximately $275,000 had been paid as of June 30, 2007, and
approximately $600,000 in exploration activities (and another $150,000 in
payments to keep the Property in good standing, which does not decrease the
amount we owe under the Option Agreement) has been paid as of the date of this
filing.





The goals
of the initial phase of exploration include evaluating the structural setting of
minerals which are found in the property and to find certain drilling targets to
be tested as part of Phase 2 of the exploration program.





Phase 1
of the exploration program on the Yoquivo Property, which was started during the
1st week of August 2006, and which has been completed to date, included the
following:





o
            Detailed
      structured mapping, to identify large and small scale structural controls,
      which will include collecting additional ground samples, which mapping has
      been completed to date.o
            An
      Airborne Magnetic Survey conducted of the Yoquivo Property via helicopter,
      which we hope will aid in the understanding and tracing of the large scale
      structural features of the property, which has been completed to
      date.o
            Underground
      Sampling, intended to gain a greater understanding of the controls on and
      nature of the mineralization within the property, which has been completed
      to date.o
            Development
      of a geological model to aid in the Phase II program described below,
      which has been completed to date.





Phase II
of our exploration of the Yoquivo Property will include drill testing of the
property which is currently ongoing.





The
drilling process includes drawing up a plan of proposed drill holes and
submitting the plan to the local ejido (surface rights owners), municipality and
government agencies for their approval. In the case of the Yoquivo Property, it
also requires a biological survey of the areas likely to be effected by the
drilling to determine any environmental considerations which may need to be
addressed in connection with the drilling. The permit specifies how many sites,
duration of proposed program, use of water, method for disposal of wastes,
hazardous material handling protocols, the name and contacts of the project
operator as well as all of the legal documentation on title for the
property.





As of the
filing of this report, 6 diamond drill holes have been completed on the Yoquivo
Property, from which various samples were drawn. West Timmins is
currently reviewing the results of these drill holes before proceeding with
further drilling or alternative exploration activities.





As of the
filing of this report, we have spent approximately $600,000 on the exploration
program on the Yoquivo Property and an additional $150,000 outside of the Option
Agreement as part of our obligation to keep the Property in good standing, and
are therefore required to expend an additional $400,000 on exploration expenses
prior to May 31, 2008, the 24 month anniversary of our entry into the Option
Agreement.
We hope to raise approximately $400,000 subsequent to the filing of this report
through the private placement of units consisting of shares of common stock and
warrants to purchase shares of our common stock, of which there can be no
assurance.


-22-





In July
2006, the Company entered into two year consulting agreements with Darin Wagner,
who is an officer and Director of West Timmins and Peter K.M. Megaw who is an
officer and Director of several companies that the Company transacts business
with, to serve as consultants to the Company in connection with the Option
Agreement and the Company’s planned exploration activities.  The
consulting agreements may be cancelled at any time, by either party, by giving
thirty days prior written notice to the non-terminating party.  It was
originally planned that the consultants would be provided stock options in
consideration for their providing consulting services to the Company, but such
options were unilaterally cancelled by the Company (see also the risk factor
entitled, “We Previously Granted An Aggregate Of 300,000 Warrants To Purchase
Shares Of Our Common Stock In November And December 2006, Which Warrants Have
Been Cancelled By Us, But Which Shareholders May Still Request Us To Honor In
The Future.”)





Competition





We are an
exploration stage company. We compete with other mineral resource exploration
and development companies for financing and for the acquisition of new mineral
properties. Many of the mineral resource exploration and development companies
with whom we compete have greater financial and technical resources than us.
Accordingly, these competitors may be able to spend greater amounts on
acquisitions of mineral properties of merit, on exploration of their mineral
properties and on development of their mineral properties. In addition, they may
be able to afford greater geological expertise in the targeting and exploration
of mineral properties. This competition could result in competitors having
mineral properties of greater quality and interest to prospective investors who
may finance additional exploration and development. This competition could
adversely impact our ability to finance further exploration and to achieve the
financing necessary for us to develop our mineral properties.





Employees





We have
no employees as of the date of this filing other than our sole officer and
Director, Adam Cegielski.





Research And Development
Expenditures





We have
not incurred any research expenditures since our incorporation. We previously
expended $5,000 on our now abandoned exploration program on our prior Nanaimo,
British Columbia claims, which have since expired and which we have since
abandoned and approximately $600,000 in exploration expenditures on our Yoquivo
Property joint venture project, described in greater detail above.





Subsidiaries





Konigsberg
Explorations Inc., a British Columbia corporation, is our sole wholly owned
subsidiary. All of our operations, other than our Joint Venture with West
Timmins are currently conducted through Konigsberg Explorations Inc. All
references in this quarterly Report to "us," the "Company," "we,"
"GoldMountain," or words of similar meaning include the operations of Konigsberg
Explorations Inc., unless otherwise stated or the context suggests
otherwise.





Patents And
Trademarks




We do not
own, either legally or beneficially, any patent or trademark.







-23-


Recent
Accounting Pronouncements





In
December 2007, the Financial Accounting Standards Board (“FASB”) issued
Statement of Financial Accounting Standards (“SFAS”) No. 141 (revised
2007), Business
Combinations , which replaces SFAS No 141. The statement retains the
purchase method of accounting for acquisitions, but requires a number of
changes, including changes in the way assets and liabilities are recognized in
the purchase accounting. It also changes the recognition of assets acquired and
liabilities assumed arising from contingencies, requires the capitalization of
in-process research and development at fair value, and requires the expensing of
acquisition-related costs as incurred. SFAS No. 141R is effective for us
beginning April 1, 2009 and will apply prospectively to business
combinations completed on or after that date.





In
December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated Financial Statements, an amendment of ARB 51 , which changes
the accounting and reporting for minority interests. Minority interests will be
recharacterized as noncontrolling interests and will be reported as a component
of equity separate from the parent’s equity, and purchases or sales of equity
interests that do not result in a change in control will be accounted for as
equity transactions. In addition, net income attributable to the noncontrolling
interest will be included in consolidated net income on the face of the income
statement and, upon a loss of control, the interest sold, as well as any
interest retained, will be recorded at fair value with any gain or loss
recognized in earnings. SFAS No. 160 is effective for us beginning
April 1, 2009 and will apply prospectively, except for the presentation and
disclosure requirements, which will apply retrospectively. At this current time,
we do not believe that adoption of SFAS No. 160 would have any effect on
our financial statements.




On
April 1, 2007, we adopted Emerging Issues Task Force Issue No. 06-2
(“EITF 06-2”), Accounting for
Sabbatical Leave and Other Similar Benefits Pursuant to FASB Statement
No. 43 . EITF 06-2 requires companies to accrue the costs of
compensated absences under a sabbatical or similar benefit arrangement over the
requisite service period. As we do not currently have a plan for compensated
absences under a sabbatical or similar benefit arrangement, the adoption of EITF
06-2 had no effect on our financial statements.





In
February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial
Assets and Financial Liabilities . SFAS No. 159 gives us the
irrevocable option to carry many financial assets and liabilities at fair
values, with changes in fair value recognized in earnings. SFAS No. 159 is
effective for us beginning April 1, 2008, although early adoption is
permitted. We are currently assessing the potential impact that electing fair
value measurement would have on our financial statements and have not determined
what election we will make.





In
September 2006, the FASB issued SFAS No. 157, Fair Value Measurements ,
which defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles, and expands disclosures about fair
value measurements. This statement does not require any new fair value
measurements, but provides guidance on how to measure fair value by providing a
fair value hierarchy used to classify the source of the information. SFAS
No. 157 is effective for us beginning April 1, 2008. In December 2007,
the FASB released a proposed FASB Staff Position (FSP FAS 157-b – Effective Date of FASB Statement
No. 157 ) which, if adopted as proposed, would delay the effective
date of SFAS No. 157 for all nonfinancial assets and nonfinancial
liabilities, except those that are recognized or disclosed at fair value in the
financial statements on a recurring basis (at least annually). We are currently
assessing the potential impact that adoption of this statement would have on our
financial statements.


-24-


PLAN
OF OPERATIONS





As stated
above, moving forward, we plan to focus all of our resources on earning an
interest in the Yoquivo Property through our Option Agreement and joint venture
with West Timmins (described above).





We
currently believe that we will be able to continue our business operations for
at least the next ninety days with the current cash on hand that we had as of
the filing of this report, if no additional funding is raised. We plan to raise
additional funding subsequent to the filing of this report from the sale of
common stock to offshore investors and/or through loans from our existing
shareholders, of which there can be no assurance. We anticipate the need for
approximately $500,000 to maintain our operations for the next twelve months and
complete the anticipated exploration activities on the Yoquivo
Property.








COMPARISON
OF OPERATING RESULTS





THREE
MONTHS ENDED DECEMBER 31, 2007, COMPARED TO THE THREE MONTHS ENDED DECEMBER 31,
2006





We have
not generated any revenues since our incorporation in November
2004.





We had
total expenses of $42,478 for the three months ended December 31, 2007, compared
to total expenses of $152,941 for the three months ended December 31, 2006, a
decrease in total expenses of $110,463 or 72.2% from the prior period. The main
reason for the decrease in expenses was due to a $73,627 decrease in mineral
exploration costs, to $0 for the three months ended December 31, 2007, compared
to $73,627 for the three months ended December 31, 2006, as we did not make any
payments to West Timmins in connection with the Option Agreement during this
period; a $35,576 or 78.8% decrease in professional fees, to $9,575 for the
three months ended December 31, 2007, compared to $45,151 for the three months
ended December 31, 2006; and a $4,951 or 25.9% decrease in office and sundry
expense to $14,146 for the three months ended December 31, 2007, compared to
$19,097 for the three months ended December 31, 2006, in connection with the
rental of our office space and the purchase of certain office supplies; which
were offset by a $2,139 increase in loss of foreign exchange, to
a loss of $1,762 for the three months ended December 31, 2007, compared to
a gain of $377 for the three months ended December 31, 2006; and a $1,552
or 10.0% increase in consulting fees to $16,995 for the three months ended
December 31, 2007, compared to $15,443 for the three months ended December 31,
2006, in connection with increased fees paid to our Chief Executive Officer,
Adam Cegielski, in consideration for services provided to us by Mr. Cegielski in
connection with his efforts to raise funds for our Joint Venture.





Professional
fees for the three months ended December 31, 2006 and 2007 were mainly
associated with fees paid to our legal counsel in connection with the
preparation of our various SEC filings and our accountant in connection with the
review of our interim financial statements and the drafting and filing of our
Form 10-QSB filings.  Professional fees decreased due to increased
expenses with our initial start up operations, exploration activities and
filings during the three months ended December 31, 2006, which expenses were not
represented during the three months ended December 31, 2007.





We had
net operating loss for the three months ended December 31, 2007 of $42,478,
compared to a net operating loss for the three months ended December 31, 2006 of
$152,941, a decrease in net operating loss of $110,463 or 72.2% from the prior
period, which was mainly in connection with the decreases in our mineral
exploration costs and professional fees for the three months ended December 31,
2007, compared to the three months ended December 31, 2006, as described
above.





We had
other loss of $35,000 for the three months ended December 31, 2007, in
connection with outstanding warrants granted in connection with the sale of
units consisting of common stock and warrants, which other loss was not
represented during the three months ended December 31, 2006.


-25-


Net loss
for three months ended December 31, 2007 was $77,478, compared to a net loss of
$152,941 for the three months ended December 31, 2006, a decrease in net loss of
$75,463 from the prior period. The decrease in net loss was mainly due to the
$110,463 decrease in net operating loss for the three months ended December 31,
2007 compared to the three months ended December 31, 2006, and the $35,000 of
stock accretion expense for the three months ended December 31, 2007, which
expense was not represented during the three months ended December 31,
2006.





NINE
MONTHS ENDED DECEMBER 31, 2007, COMPARED TO THE NINE MONTHS ENDED DECEMBER 31,
2006





We had
total expenses of $662,346 for the nine months ended December 31, 2007, compared
to total expenses of $442,498 for the nine months ended December 31, 2006, an
increase in expenses of $219,848 or 49.7% from the prior period. The main reason
for the increase in expenses, was due to a $216,805 or 83.5% increase in mineral
exploration costs to $476,327 for the nine months ended December 31, 2007,
compared to $259,522 for the nine months ended December 31, 2006, relating to
increased payments to West Timmins in connection with the Option Agreement; and
a $10,034 or 28.9% increase in consulting fees to $44,740 for the nine months
ended December 31, 2007, compared to $34,706 for the nine months ended December
31, 2006, in connection with increased fees paid to our Chief Executive Officer,
Adam Cegielski, in consideration for services provided to us by Mr. Cegielski in
connection with his efforts to raise funds for our Joint Venture; offset by a
$8,225 increase on loss of foreign exchange, to a loss of $7,226 for
the nine months ended December 31, 2007, compared to a gain of $999 for the
nine months ended December 31, 2006; a $9,236 or 20.5% decrease in office and
sundry expense to $35,877 for the nine months ended December 31, 2007, compared
to $45,113 for the nine months ended December 31, 2006, in connection with the
rental of our office space and the purchase of certain office supplies; and a
$5,980 or 5.7% decrease in professional fees to $98,176 for the nine months
ended December 31, 2007, compared to $104,156 for the nine months ended December
31, 2006.





Professional
fees for the nine months ended December 31, 2006 and 2007 were mainly associated
with fees paid to our legal counsel in connection with the preparation of our
various SEC filings and our accountant in connection with the review of our
interim financial statements and the drafting and filing of our Form 8-Kand
periodic report filings.





We had
net operating loss for the nine months ended December 31, 2007 of $662,346,
compared to a net operating loss for the nine months ended December 31, 2006 of
$442,498, an increase in net operating loss of $219,848 or 49.7% from the prior
period, which was mainly in connection with the increase in our mineral
exploration costs for the nine months ended December 31, 2007, compared to the
nine months ended December 31, 2006.





We had
other loss of $1,814,000 for the nine months ended December 31, 2007, in
connection with outstanding warrants granted in connection with the sale of
units consisting of common stock and warrants, which other loss was not
represented during the nine months ended December 31, 2006.





Net loss
for the nine months ended December 31, 2007 was $2,476,346, compared to a net
loss of $442,498 for the nine months ended December 31, 2006, an increase in net
loss of $2,033,848 from the prior period. The increase in net loss was mainly
due to the $1,814,000 of stock accretion expense for the nine months ended
December 31, 2007, which expense was not represented during the nine months
ended December 31, 2006, and the $216,805 increase in mineral exploration costs
for the nine months ended December 31, 2007, compared to the nine months ended
December 31, 2006.





LIQUIDITY
AND CAPITAL RESOURCES





We had
total assets of $1,061,849 as of December 31, 2007, which included current
assets consisting solely of cash of $1,849 and non-current assets consisting of
mineral properties of $1,060,000 in connection with our investment in the Joint
Venture with West Timmins.


-26-





We had
total liabilities, consisting solely of total current liabilities of $68,367 as
of December 31, 2007, which consisted solely of accounts payable and accrued
liabilities.





We had
negative working capital of $66,518 as of December 31, 2007. We had a deficit
accumulated during the exploration stage of $3,244,818 as of December 31,
2007.





We had
$620,747 in cash used in operating activities for the nine months ended December
31, 2007, which included $2,476,346 of net loss, offset by $1,814,000 of stock
accretion expense and $38,569 of accounts payable and accrued liabilities and
$3,030 of prepaid expenses.





We had
$605,500 of cash provided by financing activities for the nine months ended
December 31, 2007, which related to $630,500 of share capital issued for cash
offset by $25,000 of share subscription received.





We
currently believe that we will be able to continue our business operations for
at least the next ninety days with the cash on hand that we had as of the filing
of this report, if no additional funding is raised.





We had
paid approximately $600,000 towards exploration expenditures on the Yoquivo
Property as of  December 31, 2007, and an additional $150,000 towards
our obligation to keep the Property in good standing, which amount does not
count towards our required $1,000,000 in exploration expenses which we are
required to pay to West Timmins within 24 months of the date of the Option
Agreement.





From
September 30, 2007, until the date of this report, we sold an aggregate of
1,700,000 units, each consisting of one share of common stock, one two year
Class A Warrant to purchase one share of our common stock at $0.15 per share,
and one two year Class B Warrant to purchase one share of our common stock at
$0.30 per share (the “July 2007 Units”) to various offshore investors for total
consideration of $170,000, the majority of which was then paid to West Timmins
in connection with and pursuant to the Option Agreement.





In
January 2008, we sold an additional $25,000 in July 2007 Units to an offshore
investor, which units have not been issued to date, but have been included in
the number of issued and outstanding shares disclosed through this
filing.





All of
the above warrant transactions will be recorded at Fair Market Value, using the
Black Scholes valuation method.





We have
no current commitments from our officer and Director or any of our shareholders
to supplement our operations or provide us with financing in the future. If we
are unable to raise additional capital from conventional sources and/or
additional sales of stock in the future, we may be forced to curtail or cease
our operations. Even if we are able to continue our operations, the failure to
obtain financing could have a substantial adverse effect on our business and
financial results.





In the
future, we may be required to seek additional capital by selling debt or equity
securities, selling assets, or otherwise be required to bring cash flows in
balance when we approach a condition of cash insufficiency. The sale of
additional equity or debt securities, if accomplished, may result in dilution to
our then shareholders. We provide no assurance that financing will be available
in amounts or on terms acceptable to us, or at all.








-27-


RISK
FACTORS





You
should carefully consider the following risk factors and other information in
this quarterly report on Form 10-QSB before deciding to become a holder of our
Common Stock. If any of the following risks actually occur, our business and
financial results could be negatively affected to a significant
extent.




Our
business and the value of our common stock are subject to the following Risk
Factors:





We May Not Be Able To
Continue Our Business Plan And Exploration Activities Without Additional
Financing.




We depend
to a great degree on the ability to attract external financing in order to
conduct future exploratory activities. We are currently funded solely by our
shareholders and through sales of our securities and we believe that we can
continue our business operations for at least the next ninety days with the cash
we had on hand as of the filing of this report, however we plan to raise
additional funds subsequent to the filing of this report through private
placements of our common stock and/or through shareholder loans, of which there
can be no assurance. If we are unable to raise the additional funds required for
planned exploration and extraction activities, which we do not currently have
funds to pay, we may be forced to abandon our current business plan and/or we
will not be able to earn our First Option with West Timmins (as described
above). If you invest in us and we are unable to raise the required funds, your
investment could become worthless.





Our Auditors Have Expressed
Substantial Doubt As To Whether Our Company Can Continue As A Going
Concern.





We are in
our exploration stage, as planned principal activities have not begun. We have
not generated any revenues since inception and have incurred substantial losses.
These factors among others indicate that we may be unable to continue as a going
concern, particularly in the event that we cannot generate sufficient cash flow
to conduct our operations and/or obtain additional sources of capital and
financing.





We Lack An Operating History
Which You Can Use To Evaluate Us, Making Any Investment In Our Company
Risky.




We lack
an operating history which investors can use to evaluate our previous earnings,
as we were only incorporated in November 2004, and have not generated any
revenues to date. Therefore, an investment in us is risky because we have no
business history and it is hard to predict what the outcome of our business
operations will be in the future.





We May Not Find Any
Commercial Quantities Of Minerals In The Future, And May Not Generate Any
Profits, Which May Force Us To Curtail Our Business Plan.





As an
exploration stage company, we have no revenues or profits to date and our
deficit accumulated during our exploration stage as of December 31, 2007, was
$3,244,818. We had negative working capital of $66,518 as of December 31, 2007.
We are currently being funded by existing shareholders and anticipate being able
to continue our business operations for approximately the next ninety days with
the cash on hand we had as of the filing of this report, and plan to raise
additional funding subsequent to the filing of this report. However, if we do
not begin exploration and/or do not have enough money to continue exploration
activities it is likely that we will never generate any revenues. Additionally,
if we are unsuccessful in mining attempts we may choose to attempt in the
future, it is likely that we will never generate any revenues. Additionally, the
exploration of minerals is highly speculative, and if throughout our mineral
exploration we do not find commercial quantities of minerals, we will likely be
forced to curtail or abandon our business plan. If this happens, you could lose
your investment in us. If we are unable to generate profits, we will be forced
to rely on external financing, of which there is no guarantee, to continue with
our business plan.


-28-





We Have A Poor Financial
Position And If We Do Not Generate Revenues, We May Be Forced To Abandon Our
Business Plan.





We
currently have a poor financial position. We have not generated any revenues or
begun exploration on any properties. There is a risk that we will not find
enough, or even any, minerals needed to generate enough profits for your
investment in us to appreciate. If we never generate any revenues, we may be
forced to abandon our business plan and your shares may become
worthless.





We Rely Upon Key Personnel
And If They Leave Us, Our Business Plan And Results Of Operations Could Be
Adversely Affected.





We rely
heavily on our Chief Executive Officer, Chief Financial Officer, Secretary,
Treasurer and Director, Adam R. Cegielski, for our success. His experience and
input create the foundation for our business and he is responsible for the
directorship and control over our exploration activities. We do not currently
have an employment agreement or "key man" insurance policy on Mr. Cegielski,
although we anticipate entering into a consulting agreement with Mr. Cegielski
subsequent to the filing of this report. Moving forward, should we lose the
services of Mr. Cegielski, for any reason, we will incur costs associated with
recruiting a replacement and delays in our operations. If we are unable to
replace him with another suitably trained individual or individuals, we may be
forced to scale back or curtail our business plan and exploration activities. As
a result of this, your investment in us could become devalued.





Adam R. Cegielski, Our Sole
Director And Officer Can Vote An Aggregate Of 46% Of Our Common Stock And Can
Therefore Exercise Significant Control Over Corporate Decisions Including The
Appointment Of New Directors.





Adam R.
Cegielski, our sole Director and officer can vote an aggregate of 40,000,000
shares or approximately 46% of our outstanding Common Stock. Accordingly, Mr.
Cegielski will exercise significant control in determining the outcome of all
corporate transactions or other matters, including the election of directors,
mergers, consolidations, the sale of all or substantially all of our assets, and
also the power to prevent or cause a change in control. Any investors who
purchase shares will be minority shareholders and as such will have little to no
say in the direction of the Company and the election of Directors. Additionally,
it will be difficult if not impossible for investors to remove Mr. Cegielski as
a Director of the Company, which will mean he will remain in control of who
serves as officers of the Company as well as whether any changes are made in the
Board of Directors. As a potential investor in the Company, you should keep in
mind that even if you own shares of the Company's Common Stock and wish to vote
them at annual or special shareholder meetings, your shares will likely have
little effect on the outcome of corporate decisions.




We Will Be Subject To
Numerous Risks If We Commence Mining Operations, Of Which There Can Be No
Assurance.





The
mineral exploration and mining business is competitive in all of its phases. We
currently have no mining operations of any kind, however we are currently in the
process of conducting diamond drilling through our Joint Venture with West
Timmins. If we do commence mining activities in the future, we will be subject
to numerous risks, including:





o
            competitors
      with greater financial, technical and other resources, in the search for
      and the acquisition of attractive mineral properties;o
            our
      ability to select and acquire suitable producing properties or prospects
      for mineral exploration;o
            the
      accuracy of our reserve estimates, if any, which may be affected by the
      following factors beyond our
control:





-29-





-
            declines
      in the market price of the various metals we mine;-
            increased
      production or capital costs;-
            reduction
      in the grade or tonnage of the deposit;-
            increase
      in the dilution of the ore; or-
            reduced
      recovery rates;





o
            risks
      and hazards associated with environmental hazards, political and country
      risks, civil unrest or terrorism, industrial accidents, labor disputes,
      unusual or unexpected geologic formations, cave-ins, explosive rock
      failures; and flooding and periodic interruptions due to inclement or
      hazardous weather conditions; ando
            our
      failure to maintain insurance on certain risks associated with any
      exploration activities we may undertake in the
  future.





If we do
begin exploration activities in the future, of which there can be no assurance,
we will be subject to the above risks. If any of the above risks occur, we may
be forced to curtail or abandon our operations and/or exploration and
development activities, if any. As a result, any investment in us could decrease
in value and/or become worthless.





There Is Uncertainty As To
An Investors Ability To Enforce Civil Liabilities Both In And Outside Of The
United States Due To The Fact That Our Sole Officer And Director And Assets Are
Not Located In The United States.





Our
office and the majority of our assets are located in Canada, while the Yoquivo
Property, which we have entered into an Option Agreement to explore and develop,
is located in Mexico. Our sole officer and Director is located in Canada. As a
result, it may be difficult for shareholders to effect service of process within
the United States on our officer and Director. In addition, investors may have
difficulty enforcing judgments based upon the civil liability provisions of the
securities laws of the Unites States or any state thereof, both in and outside
of the United States.





We May Not Be Able To Earn
Our First Or Second Option With West Timmins Pursuant To The Option
Agreement.





In June
2006, we entered into an Option Agreement with West Timmins to earn up to a 75%
interest in the Yoquivo Property (as defined and described below). In order to
earn the interest of the Yoquivo Property, we were required to pay $600,000
during the twelve months following our entry into the Option Agreement (i.e.
prior to June 2007), which date was extended to June 30, 2007, pursuant to the
Second Extension Letter (described above), and although the $600,000 was not
paid as of June 30, 2007, the full amount of the $600,000 has been paid to date.
Additionally, prior to the twenty-fourth month anniversary of our entry into the
Option Agreement (i.e. prior to June 2008), we are required to expend at least
$1,000,000 in cumulative expenditures, of which $600,000 has been paid as of the
date of this filing. We can provide no assurance that we will be able to raise
the additional capital needed to pay the remaining balance on these cumulative
expenditures and/or earn our interest in the property on favorable terms, if at
all. If we are unable to raise the capital required to earn the interest in the
Yoquivo Property, our current expenditures towards such Option Agreement will be
forfeited and we could be forced to abandon or curtail our current business
plan. If this were to happen, the value of our common stock could become
worthless.


-30-


Our Determinations Of
Planned Activities And Estimates Of Potential Reserves May Be
Inaccurate.




We are
currently in the exploration stage. Before we can begin a development project,
if ever, we must first determine whether it is economically feasible to do so.
This determination is based on estimates of several factors,
including:





o
            expected
      recovery rates of metals from the ore;o
            facility
      and equipment costs;o
            capital
      and operating costs of a development project;o
            future
      metals prices;o
            currency
      exchange and repatriation risks;o
            tax
      rates;o
            inflation
      rates;o
            political
      risks and regulatory climate in Canada and Mexico; ando
            availability
      of credit.




Any
development projects we may undertake in the future will likely not have an
operating history upon which to base these estimates and as a result, actual
cash operating costs and returns from a development project, if any, may differ
substantially from our estimates. Consequently, it may not be economically
feasible to continue with a development project, if one is started.





We Previously Granted An
Aggregate Of 300,000 Warrants To Purchase Shares Of Our Common Stock In November
And December 2006, Which Warrants Have Been Cancelled By Us, But Which
Shareholders May Still Request Us To Honor In The Future.





In
November and December 2006, we granted 300,000 Warrants to two individuals in
consideration for consulting services rendered, at an exercise price of $0.35
per share.  We subsequently took action to amend those Warrants and have
since unilaterally cancelled such Warrants; however, those prior Warrant holders
may require us to honor the terms of the prior Warrant grants in the future. If
that were to happen, we may be required to issue additional shares of common
stock and/or expend additional resources in connection with litigation and/or
disputes regarding such Warrants and shares issuable in connection therewith
and/or the restatement of the financial statements contained herein in
connection with such prior Warrant grants.  As a result, if such Warrant
holders attempt to enforce the Warrants which have been rescinded by us, our
results of operations could be adversely affected, and we could be forced to
curtail our business plans, and as a result, any investment in us could become
worthless.





Our Planned Mineral
Exploration Efforts Are Highly Speculative.





Mineral
exploration is highly speculative. It involves many risks and is often
nonproductive. Even if we believe we have found a valuable mineral deposit, it
may be several years before production is possible. During that time, it may
become no longer feasible to produce those minerals for economic, regulatory,
political, or other reasons. Additionally, we may be required to make
substantial capital expenditures and to construct mining and processing
facilities. As a result of these costs and uncertainties, we may be unable to
start, or if started, to finish our exploration activities.


-31-





Our Operations, If Any, Will
Be Subject To Currency Fluctuations.





While we
do not currently have any operations, we believe that our products, if any, will
be sold in world markets in United States dollars. As a result, currency
fluctuations may affect the cash flow we realize from our future operations and
exploration activities, which we plan to conduct in Mexico, if any. Foreign
exchange fluctuations may materially adversely affect our financial performance
and results of operations.





Our Property Has Not
Produced Any Commercial Reserves Or Ore Body, And The Probability Of Such
Property Producing Any Commercially Viable Reserves In The Future Is
Remote.





Our
mineral project is in the exploration stage as opposed to the development stage
and we have no known body of economic mineralization. The known mineralization
at these projects has not been determined to be economic ore. Until further
exploration activities can be conducted, there can be no assurance that a
commercially mineable ore body exists on any of our properties. In order to
carry out exploration and development programs of any economic ore body and
place it into commercial production, we will be required to raise substantial
additional funding, and even if we are successful in completing our exploration
activities on our property, we may not be successful in finding commercial
quantities of minerals. Furthermore, the probability of an individual prospect
ever having reserves or being commercially viable is extremely remote. As a
result, there is only a small probability that any of our properties contain any
reserves and that any funds spent on exploration activities will ever be
recovered.





Mining Operations In General
Involve A High Degree Of Risk, Which We May Be Unable, Or May Not Choose To
Insure Against, Making Exploration And/Or Development Activities We May Pursue
Subject To Potential Legal Liability For Certain Claims.





Our
operations are subject to all of the hazards and risks normally encountered in
the exploration, development and production of minerals. These include unusual
and unexpected geological formations, rock falls, flooding and other conditions
involved in the drilling and removal of material, any of which could result in
damage to, or destruction of, mines and other producing facilities, damage to
life or property, environmental damage and possible legal liability. Although we
plan to take adequate precautions to minimize these risks, and risks associated
with equipment failure or failure of retaining dams which may result in
environmental pollution, there can be no assurance that even with our
precautions, damage or loss will not occur and that we will not be subject to
liability which will have a material adverse effect on our business, results of
operation and financial condition. If this were to happen, we could be forced to
curtail or abandon our business activities.





Nevada Law And Our Articles
Of Incorporation Authorize Us To Issue Shares Of Stock, Which Shares May Cause
Substantial Dilution To Our Existing Shareholders And/Or Have Rights And
Preferences Greater Than Our Common Stock.





Pursuant
to our Articles of Incorporation, we have 400,000,000 shares of Common Stock and
100,000,000 shares of preferred stock ("Preferred Stock") authorized. As of
February 12, 2008, we had 87,627,167 shares of our common stock outstanding,
which includes 1,980,000 shares of common stock which we have previously sold
pursuant to Offshore Subscription Agreements, which shares have not been
physically issued to date. As of February 12, 2008, - 0 - shares of Preferred
Stock were issued and outstanding. As a result, our Board of Directors has the
ability to issue a large number of additional shares of Common Stock without
shareholder approval, which if issued could cause substantial dilution to our
then shareholders. Additionally, shares of Preferred Stock may be issued by our
Board of Directors without shareholder approval with voting powers, and such
preferences and relative, participating, optional or other special rights and
powers as determined by our Board of Directors, which may be greater than our
Common Stock. As a result, shares of Preferred Stock may be issued by our Board
of Directors which cause the holders to have super majority voting power over
our shares, provide the holders of the Preferred Stock the right to convert the
shares of Preferred Stock they hold into shares of our Common Stock, which may
cause substantial
dilution to our then Common Stock shareholders and/or have other rights and
preferences greater than those of our Common Stock shareholders. Investors
should keep in mind that the Board of Directors has the authority to issue
additional shares of Common Stock and Preferred Stock, which could cause
substantial dilution to our existing shareholders. Additionally, the dilutive
effect of any Preferred Stock, which we may issue may be exacerbated given the
fact that such Preferred Stock may have super majority voting rights and/or
other rights or preferences which could provide the preferred shareholders with
voting control over us subsequent to this offering and/or provide those holders
the power to prevent or cause a change in control. As a result, the issuance of
shares of Common Stock and/or Preferred Stock, may cause the value of our
securities to decrease and/or become worthless.


-32-





We Have Yet To Attain
Profitable Operations And Because We Will Need Additional Financing To Fund Our
Exploration Activities, Our Accountants Believe There Is Substantial Doubt About
Our Ability To Continue As A Going Concern.





We had
incurred a net loss of $684,878 for the year ended March 31, 2007, had an
accumulated deficit of $768,472 as of March 31, 2007, and had a net loss of
$77,478 for the three months ended December 31, 2007, and an accumulated deficit
of $3,244,818 as of December 31, 2007, and have generated no revenues to date.
Our future is dependent upon our ability to obtain financing and upon future
profitable operations from the development of our mineral claims. These factors
raise substantial doubt that we will be able to continue as a going concern. Our
independent auditors, have expressed substantial doubt about our ability to
continue as a going concern given our recurring losses from operations, which
are described in the first risk factor above. This opinion could materially
limit our ability to raise additional funds by issuing new debt or equity
securities or otherwise. If we fail to raise sufficient capital, we will not be
able to implement our exploration program which requires significant funding
past the second phase, as a result we may have to liquidate our business and
stockholders may lose their investment. Investors should consider our auditor's
comments when determining if an investment in us is suitable.




Because Of The Unique
Difficulties And Uncertainties Inherent In Mineral Exploration Ventures, We Face
A High Risk Of Business Failure.





Stockholders
should be aware of the difficulties normally encountered by new mineral
exploration companies and the high rate of failure of such enterprises. The
likelihood of success must be considered in light of the problems, expenses,
difficulties, complications and delays encountered in connection with the
exploration of the mineral properties that we plan to undertake. These potential
problems include, but are not limited to, unanticipated problems relating to
exploration, and additional costs and expenses that may exceed current
estimates. Most exploration projects do not result in the discovery of
commercially mineable deposits of ore. Problems such as unusual or unexpected
formations and other conditions are involved in mineral exploration and often
result in unsuccessful exploration efforts. If we experience any of these
problems or delays, our exploration activities could become much more costly
than originally estimated and if such additional funding is not available if
needed, we may be forced to abandon our operations.





We Have No Known Mineral
Reserves And If We Cannot Find Any, We Will Have To Cease
Operations.





We have
no mineral reserves. If we do not find mineral reserves containing gold, silver,
or other precious minerals or if we cannot explore mineral reserves, either
because we do not have the money to do it or because it will not be economically
feasible to do it, we will have to cease operations and stockholders will lose
their investment. Mineral exploration, particularly for gold, is highly
speculative. It involves many risks and is often non-productive. Even if we are
able to find mineral reserves on our property our production capability is
subject to further risks including:




-33-





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




The
marketability of any minerals acquired or discovered may be affected by numerous
factors which are beyond our control and which cannot be accurately predicted,
such as market fluctuations, the lack of milling facilities and processing
equipment near our claims, and such other factors as government regulations,
including regulations relating to allowable production, importing and exporting
of minerals, and environmental protection.





Given the
above noted risks, the chances of finding reserves on our mineral properties are
remote and funds expended on exploration will likely be lost.





Because Of The Inherent
Dangers Involved In Mineral Exploration, There Is A Risk That We May Incur
Liability Or Damages As We Conduct Our Business.





The
search for valuable minerals involves numerous hazards. As a result, we may
become subject to liability for such hazards, including pollution, cave-ins and
other hazards against which we cannot insure or against which we may elect not
to insure. At the present time, we have no coverage to insure against these
hazards. The payment of such liabilities may result in our inability to complete
our planned exploration program and/or obtain additional financing to fund our
exploration program.





We May Conduct Further
Offerings In The Future In Which Case Stockholders Holdings Will Be
Diluted.





We
completed offerings of 35,200,000 and 2,400,000 shares of our common stock at a
price of $0.0025 per share to investors on February 28, 2005 and April 14, 2005,
respectively. Additionally, we sold 183,334 shares of our or common stock to two
offshore investors in April 2006, 448,000 shares of our common stock to three
offshore investors in June 2006, at a price of $0.60 per share, and an aggregate
of 425,834 shares of our common stock to two offshore investors in August and
September 2006, at a price of $0.60 per share. More recently, we sold 1,166,666
units consisting of one share of common stock and one warrant to purchase one
share of our common stock for $0.20 per share for aggregate consideration of
$175,000 or $0.15 per unit in March 2007, and 203,333 units for aggregate
consideration of $30,500 or $0.15 per unit in June 2007.  In July
through September 2007, we completed offerings of an aggregate of 6,350,000
units, each consisting of one share of common stock, one Class A Warrant to
purchase one share of our common stock at $0.15 per share, and one Class B
Warrant to purchase one share of our common stock at $0.30 per share (the “July
2007 Units”) for aggregate consideration of $565,000 or $0.10 per July 2007
Unit.  Additionally, in January 2008, we sold an aggregate of $25,000
in July 2007 Units to an offshore investor.





Since our
inception we have relied on such equity sales of our common stock to fund our
operations. We may conduct further equity and/or debt offerings in the future to
finance our current projects or to finance subsequent projects that we decide to
undertake. If common stock is issued in return for additional funds, the price
per share could be lower than that paid by our current stockholders. We
anticipate continuing to rely on equity sales of our common stock or debt
offerings in order to fund our business operations. If we issue additional
stock, each stockholder's percentage interest in us will be lower. This
condition is often referred to as "dilution". The result of this could reduce
the value of your stock.


-34-


If We Are Late In Filing Our
Quarterly Or Annual Reports With The SEC, We May Be De-Listed From The
Over-The-Counter Bulletin Board.




Pursuant
to Over-The-Counter Bulletin Board ("OTCBB") rules relating to the timely filing
of periodic reports with the SEC, any OTCBB issuer which fails to file a
periodic report (Form 10-QSB's or 10-KSB's) by the due date of such report (not
withstanding any extension granted to the issuer by the filing of a Form
12b-25), three (3) times during any twenty-four (24) month period is
automatically de-listed from the OTCBB. Such removed issuer would not be
re-eligible to be listed on the OTCBB for a period of one-year, during which
time any subsequent late filing would reset the one-year period of de-listing.
As we were deemed late in filing our Form 10-KSB for the period ending March 31,
2007, due to that fact that such filing as originally made failed to include our
auditors report, and because we were late in filing our quarterly report on Form
10-QSB for the period ending September 30, 2007, if we are late in our periodic
filings one more time during the next four fiscal quarters and/or late three
times in any subsequent twenty-four (24) month period, we will be de-listed from
the OTCBB, and as a result, our securities may become worthless, and we may be
forced to curtail or abandon our business plan.




In The Future, We Will Incur
Significant Increased Costs As A Result Of Operating As A Fully Reporting
Company In Connection With Section 404 Of The Sarbanes Oxley Act, And Our
Management Will Be Required To Devote Substantial Time To New Compliance
Initiatives.





Moving
forward, we anticipate incurring significant legal, accounting and other
expenses in connection with our status as a fully reporting public company. The
Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act") and new rules subsequently
implemented by the SEC have imposed various new requirements on public
companies, including requiring changes in corporate governance practices. As
such, our management and other personnel will need to devote a substantial
amount of time to these new compliance initiatives. Moreover, these rules and
regulations will increase our legal and financial compliance costs and will make
some activities more time-consuming and costly. In addition, the Sarbanes-Oxley
Act requires, among other things, that we maintain effective internal controls
for financial reporting and disclosure of controls and procedures. In
particular, for fiscal year 2007, we must perform system and process evaluation
and testing of our internal controls over financial reporting to allow
management to report on the effectiveness of our internal controls over
financial reporting, as required by Section 404 of the Sarbanes-Oxley
Act.  For fiscal year 2009, Section 404 will require us to obtain a
report from our independent registered public accounting firm attesting to the
assessment made by management.  Our testing, or the subsequent testing
by our independent registered public accounting firm, may reveal deficiencies in
our internal controls over financial reporting that are deemed to be material
weaknesses. Our compliance with Section 404 will require that we incur
substantial accounting expense and expend significant management efforts. We
currently do not have an internal audit group, and we will need to hire
additional accounting and financial staff with appropriate public company
experience and technical accounting knowledge. Moreover, if we are not able to
comply with the requirements of Section 404 in a timely manner, or if we or our
independent registered public accounting firm identifies deficiencies in our
internal controls over financial reporting that are deemed to be material
weaknesses, the market price of our stock could decline, and we could be subject
to sanctions or investigations by the SEC or other regulatory authorities, which
would require additional financial and management resources.





There is currently a
limited, sporadic, and illiquid market for our common stock, which Market we
anticipate remaining limited, sporadic, and illiquid.





We
currently anticipate that the market for our common stock will remain limited,
sporadic, and illiquid until such time as we generate significant revenues, if
ever, and that the market for our common stock will be subject to wide
fluctuations in response to several factors, including, but not limited
to:





(1)
            actual
      or anticipated variations in our results of operations;(2)
            our
      ability or inability to generate new revenues;(3)
            the
      number of shares in our public float;(4)
            increased
      competition; and


-35-





(5)
            conditions
      and trends in the mining, gold, silver or precious metals
      industries.




Furthermore,
because our Common Stock is traded on the NASD OTCBB, our stock price may be
impacted by factors that are unrelated or disproportionate to our operating
performance. These market fluctuations, as well as general economic, political
and market conditions, such as recessions, interest rates or international
currency fluctuations may adversely affect the market price of our common stock.
Additionally, at present, we have a limited number of shares in our public
float, and as a result, there could be extreme fluctuations in the price of our
common stock. Further, due to the limited volume of our shares which trade and
our limited public float, we believe that our stock prices (bid, asked and
closing prices) are entirely arbitrary, are not related to the actual value of
the Company, and do not reflect the actual value of our common stock (and in
fact reflect a value that is much higher than the actual value of our Common
Stock). Shareholders and potential investors in our Common Stock should exercise
caution before making an investment in the Company, and should not rely on the
publicly quoted or traded stock prices in determining our Common Stock value,
but should instead determine value of our Common Stock based on the information
contained in the Company's public reports, industry information, and those
business valuation methods commonly used to value private
companies.





Investors May Face
Significant Restrictions On The Resale Of Our Common Stock Due To Federal
Regulations Of Penny Stocks.





Our
Common Stock will be subject to the requirements of Rule 15(g)9, promulgated
under the Securities Exchange Act as long as the price of our Common Stock is
below $4.00 per share. Under such rule, broker-dealers who recommend low-priced
securities to persons other than established customers and accredited investors
must satisfy special sales practice requirements, including a requirement that
they make an individualized written suitability determination for the purchaser
and receive the purchaser's consent prior to the transaction. The Securities
Enforcement Remedies and Penny Stock Reform Act of 1990, also requires
additional disclosure in connection with any trades involving a stock defined as
a penny stock. Generally, the Commission defines a penny stock as any equity
security not traded on an exchange or quoted on NASDAQ that has a market price
of less than $4.00 per share. The required penny stock disclosures include the
delivery, prior to any transaction, of a disclosure schedule explaining the
penny stock market and the risks associated with it. Such requirements could
severely limit the market liquidity of the securities and the ability of
purchasers to sell their securities in the secondary market.





ITEM
3. CONTROLS AND PROCEDURES





(a)
Evaluation of disclosure controls and procedures. Our Chief Executive Officer
and Principal Financial Officer, after evaluating the effectiveness of our
"disclosure controls and procedures" (as defined in the Securities Exchange Act
of 1934 Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by
this Quarterly Report on Form 10-QSB (the "Evaluation Date"), have concluded
that as of the Evaluation Date, our disclosure controls and procedures were not
effective to provide reasonable assurance that information we are required to
disclose in reports that we file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
Securities and Exchange Commission rules and forms, and that such information is
accumulated and communicated to our management, including our Chief Executive
Officer and Principal Financial Officer, as appropriate, to allow timely
decisions regarding required disclosure.





Our
disclosure controls and procedures were not effective, as we were late in filing
our Form 10-QSB for the period ended September 30, 2007 and were late in filing
our Form 10-KSB for the period ended March 31, 2007.





(b)
Changes in internal control over financial reporting. There were no changes in
our internal control over financial reporting during our most recent fiscal
quarter that materially affected, or were reasonably likely to materially
affect, our internal control over financial reporting.


-36-





PART
II - OTHER INFORMATION





ITEM
1. LEGAL PROCEEDINGS





From time
to time, we may become party to litigation or other legal proceedings that we
consider to be a part of the ordinary course of our business. We are not
currently involved in legal proceedings that could reasonably be expected to
have a material adverse effect on our business, prospects, financial condition
or results of operations. We may become involved in material legal proceedings
in the future.





ITEM
2. UNREGISTERED SALES OF EQUITY SECURITIES





On March
15, 2007, we sold 1,000,000 units, each consisting of one share of common stock
and one two year Class A Warrant to purchase one share of common stock at an
exercise price of $0.20 per share to an entity for aggregate consideration of
$150,000, or $0.15 per unit. The shares were issued in November 2007. We claim
an exemption from registration afforded by Regulation S of the Act ("Regulation
S") for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.





In March
2007, we sold 166,666 units, each consisting of one share of common stock and
one two year Class A Warrant to purchase one share of common stock at an
exercise price of $0.20 per share to an entity for aggregate consideration of
$25,000, or $0.15 per unit. The shares were issued in November 2007. We claim an
exemption from registration afforded by Regulation S for the above issuance
since the issuance was made to a non-U.S. person (as defined under Rule 902
section (k)(2)(i) of Regulation S), pursuant to an offshore transaction, and no
directed selling efforts were made in the United States by us, a distributor,
any respective affiliates, or any person acting on behalf of any of the
foregoing.





In June
2007, we sold 50,000 units, each consisting of one share of common stock and one
two year Class A Warrant to purchase one share of common stock at an exercise
price of $0.20 per share to an individual for aggregate consideration of $7,500,
or $0.15 per unit. The shares were issued in November 2007. We claim an
exemption from registration afforded by Regulation S of the Act ("Regulation S")
for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.





In June
2007, we sold 53,333 units, each consisting of one share of common stock and one
two year Class A Warrant to purchase one share of common stock at an exercise
price of $0.20 per share to an individual for aggregate consideration of $8,000,
or $0.15 per unit. The shares were issued in November 2007. We claim an
exemption from registration afforded by Regulation S of the Act ("Regulation S")
for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.





In June
2007, we sold 100,000 units, each consisting of one share of common stock and
one two year Class A Warrant to purchase one share of common stock at an
exercise price of $0.20 per share to an individual for aggregate consideration
of $15,000, or $0.15 per unit. The shares were issued in November 2007. We claim
an exemption from registration afforded by Regulation S of the Act ("Regulation
S") for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.


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On or
about July 20, 2007, we sold 150,000, units, each consisting of one share of
common stock, one two year Class A Warrant to purchase one share of our common
stock at $0.15 per share, and one two year Class B Warrant to purchase one share
of our common stock at $0.30 per share (the “July 2007 Units”) to an individual
for aggregate consideration of $15,000, or $0.10 per unit. The shares were
issued in November 2007. We will claim an exemption from registration afforded
by Section 4(2) of the Securities Act of 1933 for the above, since the foregoing
will not involve a public offering, the recipient will take the securities for
investment and not resale and we will take appropriate measures to restrict
transfer.





On or
about July 22, 2007, we sold 500,000 July 2007 Units to an individual, for
aggregate consideration of $50,000, or $0.10 per unit. A total of 470,000 of
shares have been issued to date, and the Company is currently in the process of
issuing the additional 30,000 shares; however, we have agreed to issue such
shares, and have therefore included such shares in the number of issued and
outstanding shares disclosed throughout this filing.  We will claim an
exemption from registration afforded by Section 4(2) of the Securities Act of
1933 for the above, since the foregoing will not involve a public offering, the
recipient will take the securities for investment and not resale and we will
take appropriate measures to restrict transfer.





On or
about July 25, 2007, we sold Coach Capital, LLC 3,000,000 July 2007 Units for
aggregate consideration of $300,000, or $0.10 per unit. The shares were issued
in November 2007. We will claim an exemption from registration afforded by
Section 4(2) of the Securities Act of 1933 for the above, since the foregoing
will not involve a public offering, the recipient will take the securities for
investment and not resale and we will take appropriate measures to restrict
transfer.





On or
about July 27, 2007, we sold Epsom Investments 300,000 July 2007 Units for
aggregate consideration of $30,000 or $0.10 per unit.  The shares were
issued in November 2007. We claim an exemption from registration afforded by
Regulation S of the Act ("Regulation S") for the above issuance since the
issuance was made to a non-U.S. person (as defined under Rule 902 section
(k)(2)(i) of Regulation S), pursuant to an offshore transaction, and no directed
selling efforts were made in the United States by us, a distributor, any
respective affiliates, or any person acting on behalf of any of the
foregoing.





On or
about August 8, 2007, we sold Epsom Investments 1,000,000 July 2007 Units for
aggregate consideration of $100,000 or $0.10 per unit.  We have not
issued the 1,000,000 shares of common stock to Epsom Investments as of the date
of this filing; however, we have agreed to issue such shares, and have therefore
included such shares in the number of issued and outstanding shares disclosed
throughout this filing. We claim an exemption from registration afforded by
Regulation S of the Act ("Regulation S") for the above issuance since the
issuance was made to a non-U.S. person (as defined under Rule 902 section
(k)(2)(i) of Regulation S), pursuant to an offshore transaction, and no directed
selling efforts were made in the United States by us, a distributor, any
respective affiliates, or any person acting on behalf of any of the
foregoing.





In August
2007, we sold an individual 200,000 July 2007 Units for aggregate consideration
of $20,000 or $0.10 per unit.  The shares issuable in connection with
the Units were issued in November 2007.  We claim an exemption from
registration afforded by Regulation S of the Act ("Regulation S") for the above
issuance since the issuance was made to a non-U.S. person (as defined under Rule
902 section (k)(2)(i) of Regulation S), pursuant to an offshore transaction, and
no directed selling efforts were made in the United States by us, a distributor,
any respective affiliates, or any person acting on behalf of any of the
foregoing.





In
September 2007, we sold an entity 500,000 July 2007 Units for aggregate
consideration of $50,000 or $0.10 per unit.  The shares issuable in
connection with the Units were issued in November 2007.  We claim an
exemption from registration afforded by Regulation S of the Act ("Regulation S")
for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.


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In
September 2007, we sold Epsom Investments 500,000 July 2007 Units for aggregate
consideration of $50,000 or $0.10 per unit.  The shares issuable in
connection with the Units have not been issued to date, but have been included
in the number of issued and outstanding shares disclosed through this filing as
we have received the funds for such subscription.  We claim an
exemption from registration afforded by Regulation S of the Act ("Regulation S")
for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.





In
September 2007, we sold Epsom Investments 200,000 July 2007 Units for aggregate
consideration of $200,000 or $0.10 per unit.  The shares issuable in
connection with the Units have not been issued to date, but have been included
in the number of issued and outstanding shares disclosed through this filing as
we have received the funds for such subscription.  We claim an
exemption from registration afforded by Regulation S of the Act ("Regulation S")
for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.





In
January 2008, we sold Epsom Investments 250,000 July 2007 Units for aggregate
consideration of $25,000 or $0.10 per unit.  The shares issuable in
connection with the Units have not been issued to date, but have been included
in the number of issued and outstanding shares disclosed through this filing as
we have received the funds for such subscription.  We claim an
exemption from registration afforded by Regulation S of the Act ("Regulation S")
for the above issuance since the issuance was made to a non-U.S. person (as
defined under Rule 902 section (k)(2)(i) of Regulation S), pursuant to an
offshore transaction, and no directed selling efforts were made in the United
States by us, a distributor, any respective affiliates, or any person acting on
behalf of any of the foregoing.





ITEM
3. DEFAULTS UPON SENIOR SECURITIES





None.





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





None.





ITEM
5. OTHER INFORMATION





None.





ITEM
6. EXHIBITS AND REPORTS ON FORM 8-K





a)
EXHIBITS





Exhibit
    No.
            Description3.1(1)
            Articles
      of Incorporation.3.1
      (2)
            Certificate
      of Amendment to Articles of Incorporation3.3(1)
            Bylaws,
      as amended.3.3(3)
            Certificate
      of Change Pursuant to NRS 78.209


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3.2(3)
            Certificate
      of Correction to the Company's Articles of
Incorporation10.1(4)
            Stock
      Purchase Agreement between Susan Downing and Adam
  Cegielski10.2(5)
            Option
      Agreement with Sydney (which later merged with another entity and is now
      known as West Timmins Mining Inc.).10.3(6)
            Letter
      of Extension from West Timmins Mining, Inc. (January 29,
2007)10.4(7)
            Letter
      of Extension from West Timmins Mining, Inc. (May 31, 2007)31*
            Chief
      Executive Officer and Chief Financial Officer Certification pursuant to
      Section 302 of the Sarbanes-Oxley Act of 200232*
            Chief
      Executive Officer and Chief Financial Officer Certification pursuant to
      Section 906 of the Sarbanes-Oxley Act of
2002





* Filed
Herein.





(1) Filed as exhibits to our Form SB-2 Registration Statement filed
with the Commission on August 15, 2005, and incorporated herein by
reference.




(2) Filed
as an exhibit to our Report on Form 8-K filed with the Commission on May 29,
2007, and incorporated herein by reference.





(3) Filed
as exhibits to our Report on Form 8-K filed with the Commission on April 25,
2006, and incorporated herein by reference.





(4) Filed
as an exhibit to our Report on Form 8-K filed with the Commission on March 29,
2006, and incorporated herein by reference.





(5) Filed
as an exhibit to our Report on Form 8-K filed with the Commission on June 13,
2006, and incorporated herein by reference.





(6)
Filed as an exhibit to our Report on Form 10-QSB, filed with the Commission on
February 20, 2007, and incorporated herein by reference.




(7) Filed
as an exhibit to our Report on Form 10-KSB, filed with the Commission on July
16, 2007, and incorporated herein by reference.











b)
            REPORTS
      ON FORM 8-K





We did
not file any reports on Form 8-K during the period covered by this
Report.





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SIGNATURES





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





GOLDMOUNTAIN EXPLORATION
      CORPORATIONDATED:
      February19, 2008
            By:/s/ Adam R.
      CegielskiAdam
      R. CegielskiChief
      Executive Officer





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