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

FORM 10-QSB

**x**  Annual
  Report Pursuant To Section 13 Or 15(D) Of The Securities Exchange Act Of 1934
  
  For the fiscal year ended FEBRUARY 29, 2004

** ̈**  Transition
  Report Under Section 13 Or 15(D) Of The Securities Exchange Act Of 1934
  For the transition period from _____ to _____

Commission File Number 0-12132

SILVERADO GOLD MINES LTD.
  
  (Name of small business issuer in its charter)

|British Columbia, Canada                                       | 98-0045034                     
|-------------------------------------------------------------- | -------------------------------
|(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification
|                                                               | No.)                           
|                                                               |                                
|Suite 505, 1111 West Georgia Street                            |                                
|Vancouver, British Columbia, Canada                            | V6E 4M3                        
|(Address of principal executive offices)                       | (Zip Code)                     
|                                                               |                                
|(604) 689-1535                                                 |                                
|Issuer's telephone number                                      |                                

NONE.

___________________________________________________________
  (Former name, former address and former fiscal year, if changed since last report)

Check whether the issuer (1) filed all reports required to
  be filed by Section 13 or 15(d) of the 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 ** ̈**

State the number of shares outstanding of each of the issuers
  classes of common stock, as of the latest practicable date: 175,012,171 Shares
  of no par value Common Stock outstanding as of April 13, 2004.

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SILVERADO GOLD MINES LTD. 
  Consolidated Balance Sheets 
  (Expressed in United States Dollars)

|                                                           |   | February
      29, |   |   | November
      30, |  
|---------------------------------------------------------- | - | ------------------ | - | - | ------------------ | -
|                                                           |   | 2004               |   |   | 2003               |  
|                                                           |   | (unaudited)        |   |   |                    |  
|Assets                                                     |   |                    |   |   |                    |  
|Current assets:                                            |   |                    |   |   |                    |  
|Cash
      and cash equivalents                            | $ | 786,138            |   | $ | 397,290            |  
|Gold
      inventory                                       |   | 100,519            |   |   | 100,519            |  
|Accounts
      receivable                                  |   | 32,487             |   |   | 23,093             |  
|                                                           |   | 919,144            |   |   | 520,902            |  
|                                                           |   |                    |   |   |                    |  
|Exploration and development advances                       |   | 31,806             |   |   | 118,889            |  
|Mineral properties                                         |   | 7,371,613          |   |   | 6,690,362          |  
|Buildings, plant and equipment                             |   | 2,854,506          |   |   | 2,926,663          |  
|                                                           |   |                    |   |   |                    |  
|                                                           | $ | 11,177,069         |   | $ | 10,256,816         |  
|                                                           |   |                    |   |   |                    |  
|Liabilities and Stockholders' Equity                       |   |                    |   |   |                    |  
|Current liabilities:                                       |   |                    |   |   |                    |  
|Accounts
      payable and accrued liabilities             |   | 584,866            |   |   | 594,840            |  
|Loans
      payable secured by gold inventory              |   | 7,873              |   |   | 7,873              |  
|Mineral
      claims payable                               |   | 240,000            |   |   | 240,000            |  
|Debentures,
      current portion (note 6 (a))             |   | 268,669            |   |   | 193,303            |  
|Current
      portion of capital lease obligation (note 7) |   | 744,085            |   |   | 594,085            |  
|                                                           |   | 1,845,493          |   |   | 1,630,101          |  
|                                                           |   |                    |   |   |                    |  
|Debentures (note 6 (a))                                    |   | -                  |   |   | 194,142            |  
|Capital lease obligations (note 7)                         |   | 429,948            |   |   | 641,492            |  
|                                                           |   | 2,275,441          |   |   | 2,465,735          |  
|Stockholders' equity:                                      |   |                    |   |   |                    |  
|Common
      stock:                                        |   |                    |   |   |                    |  
|Authorized:
      200,000,000 common shares                |   |                    |   |   |                    |  
|Issued
      and outstanding:                              |   |                    |   |   |                    |  
|February
      29, 2004 174,049,154                       |   |                    |   |   |                    |  
|November
      30, 2003  146,027,352                      |   | 65,775,100         |   |   | 63,568,652         |  
|Additional
      paid-in capital                           |   | 464,314            |   |   | 464,314            |  
|Shares
      to be issued                                  |   | -                  |   |   | 115,000            |  
|Deferred
      compensation                                |   | (77,712            | ) |   | (77,712            | )
|Accumulated
      deficit                                  |   | (57,260,074        | ) |   | (56,279,173        | )
|                                                           |   | 8,901,628          |   |   | 7,791,081          |  
|                                                           |   |                    |   |   |                    |  
|                                                           | $ | 11,177,069         |   | $ | 10,256,816         |  

Continuing operations (note 2) 
  Subsequent events (note 8) 
  See accompanying notes to unaudited consolidated financial statements.

|/s/ G.L. Anselmo | /s/ S.C. McCulloch
|---------------- | ------------------
|Garry L. Anselmo | Stuart C McCulloch
|DIRECTOR         | DIRECTOR          

2


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SILVERADO GOLD MINES LTD. 
  Consolidated Statements of Operations 
  (Expressed in United States Dollars)

|                                                 |   | Three
      months |   |   | Three
      months |  
|------------------------------------------------ | - | ------------------ | - | - | ------------------ | -
|                                                 |   | ended              |   |   | ended              |  
|                                                 |   | February 29,       |   |   | February 28,       |  
|                                                 |   | 2004               |   |   | 2003               |  
|                                                 |   | (unaudited)        |   |   | (unaudited)        |  
|                                                 |   |                    |   |   |                    |  
|Expenses:                                        |   |                    |   |   |                    |  
|Accounting and audit                             | $ | 10,246             |   | $ | 4,629              |  
|Advertising and
      Promotion                  |   | 60,415             |   |   | 217,891            |  
|Consulting Fees                                  |   | 371,229            |   |   | 993,171            |  
|Depreciation                                     |   | 73,345             |   |   | 60,524             |  
|General exploration                              |   | 107,793            |   |   | -                  |  
|Interest on debentures                           |   | 4,767              |   |   | 23,779             |  
|Legal                                            |   | 16,333             |   |   | 26,151             |  
|Loss (gain) on foreign
      exchange            |   | 21,006             |   |   | (13,161            | )
|Management services
      from related party     |   | 174,259            |   |   | 63,183             |  
|Office expenses                                  |   | 118,182            |   |   | 253,450            |  
|Other interest and
      bank charges            |   | 15,743             |   |   | 980                |  
|Reporting and investor
      relations           |   | 1,496              |   |   | 2,034              |  
|Research                                         |   | -                  |   |   | 59,154             |  
|Transfer agent fees
      and mailing expenses   |   | 6,817              |   |   | 5,335              |  
|                                                 |   | 981,631            |   |   | 1,697,120          |  
|                                                 |   |                    |   |   |                    |  
|Interest and other income                        |   | 730                |   |   | 3,950              |  
|Loss and comprehensive
      loss for the period | $ | (980,901           | ) | $ | (1,693,170         | )
|                                                 |   |                    |   |   |                    |  
|Loss per share - basic and diluted               | $ | (0.01              | ) | $ | (0.02              | )
|Weighted average number of                       |   |                    |   |   |                    |  
|common shares
      outstanding                  |   | 163,062,129        |   |   | 99,673,318         |  

3


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SILVERADO GOLD MINES LTD. 
  Consolidated Statements of Cash Flows 
  (Expressed in United States Dollars)

|                                                                 |   | Three
      months |   |   | Three
      months |  
|---------------------------------------------------------------- | - | ------------------ | - | - | ------------------ | -
|                                                                 |   | ended              |   |   | ended              |  
|                                                                 |   | February 29,       |   |   | February 28,       |  
|                                                                 |   | 2004               |   |   | 2003               |  
|                                                                 |   | (unaudited)        |   |   | (unaudited)        |  
|Cash provided by (used in):                                      |   |                    |   |   |                    |  
|Operating activities:                                            |   |                    |   |   |                    |  
|Loss for the period                                              | $ | (980,901           | ) | $ | (1,693,170         | )
|Adjustments to reconcile loss to net cash used by operating      |   |                    |   |   |                    |  
|activities                                                       |   |                    |   |   |                    |  
|Depreciation, an
      item not involving cash                   |   | 73,345             |   |   | 60,524             |  
|Stock issued for
      services                                  |   | 148,320            |   |   | 602,712            |  
|Interest accrued                                                 |   | 18,222             |   |   | -                  |  
|Changes in non-cash
      operating working capital:             |   |                    |   |   |                    |  
|Accounts
      receivable                                        |   | (9,394             | ) |   | 1,693              |  
|Accounts
      payable and accrued liabilities:                  |   | (11,400            | ) |   | (76,863            | )
|Increase
      (decrease) in mineral claims payable:             |   | -                  |   |   | (140,000           | )
|                                                                 |   | (761,808           | ) |   | (1,245,104         | )
|                                                                 |   |                    |   |   |                    |  
|Financing activities:                                            |   |                    |   |   |                    |  
|Shares issued for
      cash                                     |   | 1,820,000          |   |   | 4,342,750          |  
|                                                                 |   | 1,820,000          |   |   | 4,342,750          |  
|                                                                 |   |                    |   |   |                    |  
|Investing activities:                                            |   |                    |   |   |                    |  
|Advances for Exploration
      and development                   |   | 87,083             |   |   | 89,312             |  
|Mineral claims and
      options expenditures, net of recoveries |   | (681,251           | ) |   | (1,541,235         | )
|Purchase of equipment                                            |   | (175               | ) |   | (114,996           | )
|Repayment of capital
      lease obligation                      |   | (75,000            | ) |   | -                  |  
|                                                                 |   | (669,343           | ) |   | (1,566,919         | )
|                                                                 |   |                    |   |   |                    |  
|Net increase in cash                                             |   | 388,849            |   |   | 1,530,727          |  
|                                                                 |   |                    |   |   |                    |  
|Cash, beginning of period                                        |   | 397,290            |   |   | 905,000            |  
|                                                                 |   |                    |   |   |                    |  
|Cash, end of
      the period                                    | $ | 786,139            |   | $ | 2,435,727          |  
|                                                                 |   |                    |   |   |                    |  
|Supplementary disclosure with respect to cash flow               |   |                    |   |   |                    |  
|(note
      5)                                                   |   |                    |   |   |                    |  

4


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SILVERADO GOLD MINES LTD. 
  Notes to Consolidated Financial Statements 
  (Unaudited) 
  (Expressed in United States Dollars)

Three months ended February 29, 2004 and February 28, 2003

|1. | Basis of presentation:
      The unaudited consolidated balance sheet, the unaudited
        consolidated statements of operations and cash flows include the accounts
        of us and our wholly-owned subsidiary company. These statements have been
        prepared in accordance with United States generally accepted accounting
        principles for interim financial information. These financial statements
        comply, in all material respects, with generally accepted accounting principles
        in Canada.
      The accompanying unaudited consolidated financial statements
        do not include all information and footnote disclosures required under
        United States or Canadian generally accepted accounting principles. In
        the our opinion, all adjustments (consisting solely of normal recurring
        accruals) considered necessary for a fair presentation of the financial
        position, results of operations and cash flows as at February 29, 2004,
        and for all periods presented, have been included. Readers of these financial
        statements should note that interim results for the three-month periods
        ended February 29, 2004, and February 28, 2003, are not necessarily indicative
        of the results that may be expected for the fiscal year as a whole.
      These financial statements should be read in conjunction
        with the consolidated financial statements and notes thereto included
        in our annual report on Form 10-KSB for the fiscal year ended November
        30, 2003.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2. | Continuing operations:
        At February 29, 2004, we had a working capital deficiency of $926,349,
          down from a working capital deficiency of $1,109,199 at November 30,
          2003, primarily as a result of increased funding from issuances of common
          stock and a significant reduction of our debt.
        These financial statements have been prepared on a going concern basis,
          which assumes the realization of assets and settlement of liabilities
          in the normal course of business. The application of the going concern
          concept and the recovery of amounts recorded as mineral properties and
          buildings, plant and equipment is dependent on our ability to obtain
          additional financing to fund our operations and acquisition, exploration
          and development activities, the discovery of economically recoverable
          ore on our properties, and the attainment of profitable operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

5

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SILVERADO GOLD MINES LTD. 
  Notes to Consolidated Financial Statements 
  (Unaudited) 
  (Expressed in United States Dollars)

Three months ended February 29, 2004 and February 28, 2003

2. Continuing operations (continued):

We plan to continue to raise capital through private placements
  and warrant issues. We are exploring other business opportunities including
  the development of Low-Rank Coal-Water Fuel as a replacement fuel for oil fired
  industrial boilers and utility generators.

3. Related party transactions:

We have had related party transactions with Tri-Con Mining
  Ltd., Tri-Con Mining Inc., Tri-Con Mining Alaska Inc. (collectively the Tri-Con
  Mining Group), all of which are controlled by a director of ours.

The Tri-Con Mining Group are operations, exploration, and
  development contractors, and have been employed by us under contract since 1972
  to carry out all of our fieldwork and to provide administrative and management
  services. Under our current contract dated January, 1997 work is charged at
  cost plus 25% for exploration and cost plus 15% for development and mining.
  Cost includes out of pocket or actual cost plus 15% charge for office overhead
  including stand by and contingencies. There is no mark up on capital purchases.
  Services of the directors of the Tri-Con Mining Group are charged at a rate
  of Cdn. $75 per hour. Services of the directors of the Tri-Con Mining Group
  who are also directors of ours are not charged. At February 29, 2004, we had
  prepaid $31,806 to the Tri-Con Mining Group for exploration, development and
  administration services to be performed during the current fiscal year on behalf
  of us. The Tri-Con Mining Groups services for the current fiscal year
  are focusing mainly on the our Low-Rank Coal-Water Fuel program as well as corporate
  planning and preparation for year round production on our Nolan property, and
  administration services at both our field and corporate offices.

The aggregate amounts paid to the Tri-Con Group each period
  by category, including amounts relating to the Grant Mine Project and Nolan
  properties, for disbursements and for services rendered by the Tri-Con Group
  personnel working on our projects, and including interest charged on outstanding
  balance at the Tri-Con Group's borrowing costs are shown below:

|                                                                     | February
      29, 2004 | February
      28, 2003
|-------------------------------------------------------------------- | ----------------------- | -----------------------
|                                                                     |                         |                        
|Exploration and development services                                 | 633,020                 | 1,009,269              
|Administrative and management services                               | 158,648                 | 56,482                 
|Research                                                             | -                       | 59,154                 
|                                                                     | $791,668                | $1,124,905             
|                                                                     |                         |                        
|Amount
      of total charges in excess of Tri-Con costs incurred    | $111,392                | $457,186               
|                                                                     |                         |                        
|Excess
      amount charged as a percentage of actual costs incurred | 16.4%                   | 40.6%                  

6


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SILVERADO GOLD MINES LTD. 
  Notes to Consolidated Financial Statements 
  (Unaudited) 
  (Expressed in United States Dollars)

Three months ended February 29, 2004 and February 28, 2003

|4. | Loss per share:
      Basic loss per share has been calculated using the weighted
        average number of common shares outstanding for each period. Loss per
        share does not include the effect of the potential exercise of options
        and warrants and the conversion of debentures as their effect is anti-dilutive.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                       
|5. | Supplementary cash flow information:
      Supplemental non-cash investing and financing activities:                                                                                                                                                                                                                                  

| |                                              |   | February
      29, |  |   | February
      28, |  
| | -------------------------------------------- | - | ------------------ |  | - | ------------------ | -
| |                                              |   | 2004               |  |   | 2003               |  
| |                                              |   |                    |  |   |                    |  
| | Purchase of fixed assets under capital lease | $ | -                  |  | $ | (145,170           | )
| | Issuance of shares for:                      |   |                    |  |   |                    |  
| | Debentures                                   |   | 119,245            |  |   | 119,245            |  
| | Interest
      on debentures                 |   | 3,883              |  |   | 22,426             |  
| | Consulting services                          |   | 148,320            |  |   | 116,750            |  
| | Capital lease obligation                     |   | -                  |  |   | 145,170            |  

|6. | Debentures:
      On March 1, 2001, we completed negotiations to restructure
        our $2,000,000 convertible debentures. We issued replacement debentures
        in the aggregate amount of $2,564,400 consideration of cancellation of
        the $2,000,000 principal amount plus all accrued interest on the original
        debentures to March 1, 2001.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                   
|   | (a)                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                   
|   | (b)                                                                                                                                                                                                                                                                                                                                                               

7

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SILVERADO GOLD MINES LTD. 
  Notes to Consolidated Financial Statements 
  (Unaudited) 
  (Expressed in United States Dollars)

Three months ended February 29, 2004 and February 28, 2003

|**7.** | Lease purchase agreement:
|------ | -------------------------
|       |                          
|       | a)                       
|       |                          
|       | b)                       

| |                                    |   | Amount    | 
| | ---------------------------------- | - | --------- | 
| |                                    |   |           | 
| | November 30, 2004                  | $ | 643,922   | 
| | November 30, 2005                  |   | 635,302   | 
| | November 30, 2006                  |   | 52,880    | 
| |                                    |   |           | 
| | Total minimum lease payments       |   | 1,332,104 | 
| | Less: Amount representing interest |   | 158,071   | 
| |                                    |   | 1,174,033 | 
| | Less: Current portion              |   | 744,085   | 
| |                                    |   |           | 
| |                                    | $ | 429,948   | 

8

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SILVERADO GOLD MINES LTD. 
  Notes to Consolidated Financial Statements 
  (Unaudited) 
  (Expressed in United States Dollars)

Three months ended February 29, 2004 and February 28, 2003

|8. | Subsequent events:
|-- | ------------------
|   |                   
|   | (a)               
|   |                   
|   | (b)               
|   |                   
|   | (c)               

9

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

FORWARD-LOOKING STATEMENTS

The information in this Quarterly Report on Form 10-QSB contains
  forward-looking statements within the meaning of Section 27A of the Securities
  Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
  as amended. These forward-looking statements involve risks and uncertainties,
  including statements regarding our capital needs, business plans and expectations.
  Such forward-looking statements involve risks and uncertainties regarding the
  market price of gold, availability of funds, government regulations, common
  share prices, operating costs, capital costs, outcomes of ore reserve development
  and other factors. Forward-looking statements are made, without limitation,
  in relation to operating plans, property exploration and development, availability
  of funds, environmental reclamation, operating costs and permit acquisition.
  Any statements contained herein that are not statements of historical facts
  may be deemed to be forward-looking statements. In some cases, you can identify
  forward-looking statements by terminology such as "may", "will", "should", "expect",
  "plan", "intend", "anticipate", "believe", "estimate", "predict", "potential"
  or "continue", the negative of such terms or other comparable terminology. Actual
  events or results may differ materially. In evaluating these statements, you
  should consider various factors, including the risks outlined below, and, from
  time to time, in other reports we file with the SEC. These factors may cause
  our actual results to differ materially from any forward-looking statement.
  We disclaim any obligation to publicly update these statements, or disclose
  any difference between its actual results and those reflected in these statements.
  The information constitutes forward-looking statements within the meaning of
  the Private Securities Litigation Reform Act of 1995. Given these uncertainties,
  readers are cautioned not to place undue reliance on such forward-looking statements.

OVERVIEW

We are engaged in the acquisition, exploration and development
  of mineral properties in the State of Alaska. Currently we are actively engaged
  in development, mining and exploration activities at our Nolan Gold Project.
  Our plan of operations for the next twelve months is to continue development,
  mining and exploration activities at the Nolan Gold Project. We are also seeking
  financing to enable us to construct a commercial test facility with the objective
  of establishing the viability of the production of low-rank coal-water fuel
  as a replacement for oil fired boilers and electrical utility generators.

We hold interests in four groups of mineral properties in Alaska, namely:

|1. | our Nolan Gold Project;        
|-- | -------------------------------
|   |                                
|2. | our Ester Dome Gold properties;
|   |                                
|3. | our Hammond properties; and    
|   |                                
|4. | our Eagle Creek properties.    

PLAN OF OPERATIONS

Our plan of operation for our mineral properties is discussed below:

The Nolan Gold Project

Our plan of operation is to continue exploration, development
  and mining programs at the Nolan Gold Project. Our exploration activities are
  directed at the definition of placer gold targets and location of the lode source
  of the Nolan placer gold deposits. Gold placer exploration and development is
  presently ongoing to evaluate the gold bearing gravel deposits on the Nolan
  property which include extensive areas of ancient elevated bench gravels and
  deep channel gold bearing gravels. Both types of deposits are the result of
  intra-glacial geo-hydrologic events including deposition, erosion, transportation.
  Our exploration for lode gold is being focused on the Solomon Shear Trend. Our
  successful definition of a significant gold deposit in any of these areas could
  lead to us developing and mining those areas. Our recent development and mining
  activities have been carried out as part of a three year mining plan for the
  Nolan Gold Project.

10

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We have presently suspended our development and mining activities
  on the Nolan Deep Channel that are being carried out as part of the three year
  mining plan for the Nolan Gold Project. We are currently evaluating our mining
  and development plans for 2004. We anticipate proceeding with development and
  mining on the elevated benches above the Nolan Creek, however no determination
  has been made to date. We anticipate proceeding with development and mining
  of the elevated benches above the Nolan Creek, rather than continuing with the
  development and mining of the Nolan Deep Channel, as the elevated benches are
  less prone to the severe water problems that we encountered at the Nolan Deep
  Channel in winter 2002/ 2003. We believe that further development drilling on
  the Nolan Deep Channel is warranted prior to re-commencing development and mining
  activities at the Nolan Deep Channel in order to better delineate areas targeted
  for development and mining while minimizing inflow water problems.

The main focus of our current mining and development activities
  is placer gold. Placer gold is gold that has been separated from
  its host rock and is often re-concentrated in beds of old streams and rivers.
  Placer gold will occur in both nugget form and in fine gold form.

We plan to spend approximately $2,400,000 in the next twelve
  months in carrying out our development, mining and exploration plans for the
  Nolan Gold Project. While this amount of expenditures may be off-set by any
  revenues we achieve from gold production, we anticipate that we will require
  substantial financing in order to proceed with our plan of operations. We presently
  have sufficient financing that will enabled us to proceed with mining and development
  plans for the next 6 months. See the discussion of our cash resources and working
  capital under Liquidity and Financial Condition below and in the section entitled
  Risk Factors.

Planned Mining Operations

We are drilling the following areas of the Nolan Gold Project
  in order to determine our current mining plan as part of our drilling program
  for the 2003/ 2004 winter season: Mary's Bench, the Nolan Deep Channel, the
  Swede Channel and the Treasure Chest area. Marys Bench, the Swede Channel
  and the Treasure Chest area are various gravel benches located above the elevation
  of Nolan Creek on the slopes of the Smith Dome. Marys Bench is located
  approximately 200 to 300 feet in elevation above the confluence of Nolan Creek
  and Archibald Creek. Treasure Chest bench is located approximately 200 to 400
  feet in elevation above the Nolan Creek to the south of Marys Bench.

We anticipate that our mining plan will include the mining
  of Marys Bench by open cut mining methods. However, to date we have not
  finalized our current mining plan. Our plan is dependent on the geological review
  of the drill holes being completed during the winter of 2004 as well as our
  assessment of whether surface or underground mining will be optimal for extraction
  operations. Any gravel that is mined as part of our mining plan will be processed
  for gold recovery in the summer of 2004.

Our plan of operations at the Nolan Gold Project will be continually
  evaluated and modified as mining, development and exploration results become
  available. Modifications to our plan will be based on many factors, including:
  assessment of data, weather conditions, mining costs the price of gold and available
  capital. Further, the extent of the mining plan that we undertake will be dependent
  upon the amount of financing available to us to carry out our mining plans.

Exploration Program Planned for Nolan during 2004

We are currently undertaking an extensive geological exploration
  program on the Nolan Gold Project. The objective of this geological exploration
  program is to further define gold deposits in order to provide a basis for the
  assessment of the feasibility of future additional mining at the Nolan Gold
  Project. We plan to conduct further exploration of the Nolan Placer, Nolan Lode,
  Smith Creek Placer, and Slisco Bench properties that comprise the Nolan Gold
  project. Our planned geological exploration program is described in detail in
  Item 1. - Description of Business of our Annual Report on Form 10-KSB for the
  year ended November 30, 2004.

We plan to spend approximately $600,000 on exploration activities
  during the next twelve months. This amount will fluctuate depending on the actual
  amount of funds that we have available for exploration. The exploration work
  to be completed will be subject to intermittent interruptions caused by inclement
  or intense cold weather.

11

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Low-Rank Coal-Water Fuel Project

We plan to submit a revised proposal to the DOEs second
  solicitation under the Clean Coal Power Initiative in September 2004. There
  is no assurance that our second submission for a commercial-scale LRCWF facility
  to the DOE CCPI will be successful. If our proposal is successful, funds would
  not be available until 2005 and any funds would be repayable under the terms
  of the grant. In addition, we may be required to obtain additional financing
  in order to fund our required contribution to this project. We anticipate spending
  approximately $300,000 during the current fiscal year on our application to
  the Department of Energy and on other work in connection with establishment
  of the demonstration facility at the Grant Mill.

RESULTS OF OPERATIONS

Three months ended February 29, 2004 compared to the three months ended February 28, 2003.

Revenues

We did not earn revenues during the three months ended February
  29, 2004 or February 28, 2003 as we did not reach commercial production of gold
  from the Nolan Gold Project during this period. We did not achieve any gold
  sales during the three months ended February 29, 2004.

We plan to re-commence extraction activities in summer 2004
  when available melt water will allow the processing of ore to separate gold
  if we proceed with any development and mining plans for 2004. Any recoveries
  from gold sales are not anticipated to be realized until the third quarter of
  2004. Under our accounting policies, any gold sales that may be realized will
  be treated as sales received incidental to developmental activities on the Nolan
  Gold Project until such time as we have reached commercial levels of gold production
  from the Nolan Gold Project. We cannot provide investors with any assurance
  as to sales of gold during fiscal 2004 due to the uncertainties of gold mining.
  See Risk Factors.

We anticipate that we will not realize revenues during the
  current fiscal year from the low-rank coal-water fuel component of our plan
  of operations. We will not be able to realize revenues from this business until
  we are able to proceed with the construction and operation of a commercial-scale
  demonstration facility for the low-rank coal-water fuel technology. There is
  no assurance that we will be able to secure the financing necessary to proceed
  with construction of this demonstration facility or that the demonstration facility
  will prove the commercial viability of the process.

Operating Costs

We did not incur any operating costs during the period ended
  February 29, 2004 and February 28, 2003 due to the fact that we did not achieve
  commercial production from mining activities during either period.

We incurred development costs in the amount of $681,251, net
  of recoveries from gold sales, on the Nolan Gold Project during the three months
  ended February 29, 2004 compared to $1,541,235 during the three months ended
  February 28, 2003. These development costs were incurred in connection with
  our development and mining activities at the Nolan Gold Project. Development
  costs were capitalized in accordance with our policy to capitalize development
  expenses prior to production. Development expenses at the Nolan Gold Project
  will be expensed as operating costs once production at the Nolan Gold Project
  commences.

Expenses

Our expenses decreased to $981,631 for the three months ended
  February 29, 2004 compared to $1,697,120 for the three months ended February
  28, 2003, representing a decrease of $715,489 or 42%. The decrease in expenses
  was primarily attributable to reductions in consulting fees, advertising and
  promotion, research and office expenses during the three months ended February
  29, 2004. Decreases on these expenditures were in-part off-set by increases
  in general exploration and management services from related party expenses.

Management services attributable to the activities of the
  Tri-Con Group increased to $174,259 for the three months ended February 29,
  2004 compared to $63,183 for the three months ended February 28, 2003.

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Our increased exploration activity on our mineral properties
  caused our general exploration expenses to increase to $107,793 for the three
  months ended February 29, 2004 compared to $nil for the three months ended February
  28, 2003 The increase in exploration expenses was attributable to increased
  exploration activities at the Nolan Gold Project compared to 2003 when activities
  were directed to mining of the Nolan Deep Channel. These exploration activities
  included drilling and exploration activities on the Nolan Deep Channel, Marys
  Bench, and Treasure Chest areas. We anticipate that these expenses will continue
  as we proceed with our planned drilling and exploration activities on the Nolan
  Gold properties.

Research activities attributable to the low-rank coal water
  fuel technology decreased to $nil for the three months ended February 29, 2004
  compared to $59,154 for the three months ended February 28, 2003. Our research
  activities are primarily in connection with the submission of our application
  for a grant to the Department of Energy and include the compensation of Dr.
  Warrack Willson. We anticipate that these expenses will not increase during
  the current fiscal year based on our decision to re-submit our application for
  the second round of financing. We do not expect significant research expenses
  as we plan to continue our focus on development, mining and exploration at the
  Nolan Gold Project.

Office expenses decreased to $118,182 for the three months
  ended February 29, 2004 compared to $253,450 for the three months ended February
  28, 2003, representing a decrease of $135,268 or 53%. This decrease reflects
  a decrease in our general operations and activity in our offices in Fairbanks,
  Alaska due to the fact that we were not carrying out mining activities during
  the first quarter of our current fiscal year.

Consulting fees decreased to $371,229 for the three months
  ended February 29, 2004 compared to $993,171 for the three months ended February
  28, 2003, representing a decrease of $621,942 or 63%. The decrease was attributable
  to less stock based compensation paid to our consultants compared to last year.
  Compensation was recorded based on the quoted market price of our shares as
  of the date of issue.

Loss

Our loss decreased to $980,901 for the three months ended
  February 29, 2004 compared to $1,693,170 for the three months ended February
  28, 2003 representing a decrease of $712,269 or 42%. This decrease in our loss
  was primarily attributable to the decreases in our other expenses, as discussed
  above. We anticipate that we will continue to incur a loss until such time as
  we can achieve significant revenues from sales of gold processed from the Nolan
  Gold Project.

LIQUIDITY AND FINANCIAL CONDITION

Cash and Working Capital

We had cash and cash equivalents of $786,138 as of February
  29, 2004, compared to cash of $397,290 as of November 30, 2003. We had a working
  capital deficiency of $926,349 as of February 29, 2004, compared to a working
  capital deficiency of $1,109,199 as of November 30, 2003. The decrease in our
  working capital deficiency was primarily the result of financings completed
  during the three months ended February 29, 2004.

We will require additional financing during the current fiscal
  year due to our current working capital deficiency, our plan of operations for
  the Nolan Gold Project, our planned exploration activities and our plan to re-submit
  a grant application to the Department of Energy. We are able to proceed with
  our plan of operations for approximately 6 months based on our current cash
  reserves. While financing requirements will be off-set by revenues generated
  from gold sales, these gold sales are not anticipated to cover all financing
  requirements. In addition, revenues will be subject to the quantity of gold
  recovered.

Cash Used in Operating Activities

Cash used in operating activities decreased to $761,808 for
  the three months ended February 29, 2004, compared to $1,245,104 for the three
  months ended February 28, 2003. We funded the cash used in operating activities
  primarily through equity sales of our common shares.

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Financing Activities

Cash provided by financing activities decreased to $1,820,000
  for the three months ended February 29, 2004, compared to $4,342,750 for the
  three months ended February 28, 2003. All cash provided by financing activities
  was provided by share issuances. Cash provided by financing activities was used
  to fund our operating and investing activities. Equity financings were completed
  with private purchasers at prices that were reflective of the market price of
  our common shares as of the date of the financing.

We anticipate continuing to rely on equity sales of our common
  shares in order to continue to fund our business operations. Issuances of additional
  shares will result in dilution to our existing shareholders.

Investing Activities

We used $669,343 in investing activities during the three
  months ended February 29, 2004 compared to $1,566,919 during the three months
  ended February 28, 2003, representing a decrease of $897,576. The decrease was
  due to our scaling back mining operations at the Nolan Gold Project.

We incurred development costs in the amount of $681,251 on
  the Nolan Gold Project during the three months ended February 29, 2004 compared
  to $1,541,235 during the three months ended February 28, 2003, each net of recoveries.
  These amounts were capitalized and are included in our consolidated statements
  of cash flows as investing activities.

Capital Leases

On October 11, 2002, we entered into a lease purchase agreement
  whereby we would purchase three dump trucks, an underground loader, two surface
  loaders, and other equipment valued at a total of $1,496,150. The agreement
  required payment upon signing of $550,000 (paid), $100,000 on or before December
  1, 2003 and 24 equal payments thereafter for the balance of the purchase price
  plus interest at a rate of 12% per annum.

On February 14, 2003, we entered into a three year lease agreement
  whereby we would purchase mining equipment valued at $250,170. The agreement
  required a payment on signing of $105,000 (paid), $25,000 on or before December
  4, 2003 and 24 equal payments for the balance of the purchase price plus interest
  at a rate of 12% per annum.

As at February 29, 2004, the total amount outstanding under
  the two lease purchase agreements was $1,332,104, including interest of $158,071.
  We are required to maintain the equipment in good working order and are also
  required to maintain adequate insurance on the equipment. We are required to
  complete future lease payments of $643,922 during the 2004 fiscal year, $635,302
  during the 2005 fiscal year and $52,880 during the 2006 fiscal year.

Tri-Con Group

We had pre-paid $31,806 to the Tri-Con Group as of February
  29, 2004 in connection with planned development activities to be carried out
  on the Nolan Gold Project during fiscal 2004. These activities will be carried
  out by the Tri-Con Group on behalf of us in accordance with our operating agreements
  with the Tri-Con Group. See item  12 Certain Relationships and Related
  Transactions of our Annual Report on Form 10-KSB.

Debt Re-Structuring

On March 1, 2001, we completed negotiations to restructure
  our $2,000,000 convertible debentures. We approved the issuance of replacement
  debentures in the aggregate amount of $2,564,400 in consideration of cancellation
  of the $2,000,000 principal amount of the original debentures, plus all accrued
  interest on the original debentures to March 1, 2001. The replacement debentures
  bear interest of 8.0% per annum and mature March 1, 2006. Principal payments
  are due at the end of each month. Interest is due and payable on a quarterly
  basis on February 28, May 31, August 31, and November 30. If we fail to make
  any payment of principal or interest, we must issue shares equivalent in value
  to the unpaid amounts at 20% below the average market price for the 30 day period
  prior to the payment being made. We did not make any cash payments of principal
  or interest during the three months ended February 29, 2004. We completed the
  issue of 1,119,342 shares at

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the average market price of $0.11 to the holders of the replacement
  debenture to satisfy the quarterly payments due February 29, 2004. The value
  of the transaction consists of $119,245 of principal and $3,883 of interest.

As at February 29, 2004, $1,860,000 plus $524,892 of accrued
  interest has been exchanged for replacement debentures. The amount of the replacement
  debentures outstanding as of February 29, 2004 was $74,897, all of which is
  classified as current. Remaining original convertible debentures of $140,000
  plus accrued interest of $67,627 are in default and are recorded as current
  liabilities. There is no agreement to exchange this amount of remaining original
  convertible debentures into replacement debentures.

Low-Rank Coal-Water Fuel Business

We are continuing our attempt to obtain a grant of $10,000,000
  in order to proceed with establishing the commercial viability of our low-rank
  coal-water fuel business. The first round of grants on the Clean Coal Power
  Initiative was released by the Department of Energy and our application for
  a grant was not approved. We plan to re-submit our application to the Department
  of Energy for the second round of grants in September of 2004 There is no assurance
  that we will be awarded any grant or that it will be able to complete any additional
  sales of our equity securities or arrange for debt or other financing to fund
  this component of our plan of operations.

Future Financings

We require additional financings in order to fund our plan
  of operations. We anticipate continuing to rely on equity sales of our common
  shares in order to continue to fund our business operations. Issuances of additional
  shares will result in dilution to our existing shareholders. There is no assurance
  that we will achieve any additional sales of our equity securities or arrange
  for debt or other financing to fund our planned mining, development and exploration
  activities.

CRITICAL ACCOUNTING POLICIES

Going Concern

Our financial statements have been prepared on a going concern
  basis, which assumes the realization of assets and settlement of liabilities
  in the normal course of business. The application of the going concern concept
  and the recovery of amounts recorded as mineral properties and the capital assets
  are dependent on our ability to obtain additional financing to fund our operations
  and acquisition, exploration and development activities, the discovery of economically
  recoverable ore on our properties, and the attainment of profitable operations.
  We plan to continue to raise capital through private placements and warrant
  issues. In addition, we are exploring other business opportunities including
  the development of low-rank coal-water fuel as replacement fuel for oil fired
  industrial boilers and utility generators.

Mineral Properties

We confine our exploration activities to areas from which
  gold has previously been produced or to properties, which are contiguous to
  such areas and have demonstrated mineralization. We capitalize the costs of
  acquiring mineral claims until such time as the properties are placed into production
  or abandoned. Expenditures for mine development are capitalized when the properties
  are determined to have economically recoverable, proven reserves but are not
  yet producing at a commercial level. Once a property reaches commercial levels
  of production operating costs will be charged against related revenues. Based
  on the application of this accounting policy, the expenditures incurred in development
  of the Nolan Gold Project during fiscal 2003 were capitalized. Development expenses
  at the Nolan Gold Project will be expensed as operating costs once production
  at the Nolan Gold Project commences.

Amortization of mineral property costs relating to properties
  in production is provided during periods of production using the units-of-production
  method based on the estimated economic life of the ore reserves. On an ongoing
  basis, we evaluate each property for impairment based on exploration results
  to date, and considering facts and circumstances such as operating results,
  cash flows and material changes in the business climate. The carrying value
  of a long-lived asset is considered impaired when the anticipated discounted
  cash flow from such asset is separately identifiable and is less than its carrying
  value. If an asset is impaired, a loss

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is recognized based on the amount by which the carrying value
  exceeds the fair market value of the long-lived asset. Fair market value is
  determined primarily using the anticipated discounted cash flows with a discount
  rate commensurate with the risk involved. Losses on other long-lived assets
  to be disposed of are determined in a similar manner, except that fair market
  values are reduced for the costs of disposal.

The amounts shown for mineral properties and development which
  have not yet commenced commercial production represent costs incurred to date,
  net of recoveries from developmental production, and are not intended to reflect
  present or future values.

Stock Based Compensation

Effective November 1, 2002, we adopted the fair value recognition
  provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation.
  Under the modified prospective method of adoption selected by us under the provisions
  of FASB Statement No. 148, Accounting for Stock-Based Compensation  Transition
  and Disclosure, compensation cost recognized in 2003 is the same as that which
  would have been recognized had the recognition provisions of Statement 123 been
  applied from its original effective date. Results for prior years have not been
  restated.

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RISK FACTORS

We face risks in completing our exploration and development
  plans and achieving revenues. The following risks are material risks that we
  face. We also faces the risks identified elsewhere in this Quarterly Report
  on Form 10-QSB and in other filings with the Securities and Exchange Commission.
  If any of these risks occur, our business, our ability to achieve revenues,
  our ability to produce gold, our operating results and our financial condition
  could be seriously harmed.

If we do not obtain new financings, the amount of funds
  available to us to pursue development and mining of the Nolan Gold Project and
  to pursue further exploration of our mineral properties will be reduced.

We have relied on recent private placement financings in order
  to fund development of the Nolan Gold Project and our exploration activities.
  We will continue to require additional financing to complete our plan of operations
  for mining and development work at the Nolan Gold Project, to achieve gold production
  and to carry out our exploration programs on our other mineral properties. While
  our financing requirements may be reduced if gold production is achieved, any
  impairment in our ability to raise additional funds through financings would
  reduce the available funds for the development and mining of the Nolan Gold
  Project and for additional exploration activities, with the result that our
  plan of operations may be adversely affected and potential revenues reduced
  or delayed.

As we have a working capital deficit and we have not reported
  revenues in our last two fiscal years there is no assurance that we will be
  able to achieve the financing necessary to enable us to proceed with our exploration,
  development and mining activities.

We had a working capital deficiency of $926,349 as of February
  29, 2004. We did not report revenues in our last two fiscal years ended November
  30, 2003 or 2002. Our plan of operations calls for substantial expenditures
  of $2,400,000 to be incurred by us over the next twelve months in order to continue
  mining and development activities at the Nolan Gold Project and to pursue exploration
  activities on our mineral properties. While we will apply proceeds from gold
  sales to cover these expenditures, we anticipate that proceeds from gold sales
  over the next twelve months will not exceed our projected expenditures during
  this period with the result that we will require substantial financing in order
  for us to pursue our plan of operations. If we do not achieve the necessary
  financing, then we will not be able to proceed with our planned exploration,
  development and mining activities and our financial condition, business prospects
  and results of operations will be materially adversely affected.

If we are unable to achieve predicted gold recoveries from
  our Nolan Gold Project, then our financial condition and our revenues will be
  adversely affected.

We are currently undertaking the development and the mining
  of the Nolan Gold Project. We proceeded with the underground mining of the Nolan
  Deep Channel and surface mining of the Marys and Wooll Benches as a result
  of geological exploration which predicted a certain recovery rate of gold per
  volume of ore recovered. Any sales of gold that we realize from up coming mining
  activity on the Nolan Gold Project will be less than anticipated if the mined
  material that we mine does not contain the concentration of gold predicted by
  geological exploration. If sales of gold are less than anticipated, then our
  ability to continue operations of the Nolan Gold Project, to continue further
  exploration activities on our other mineral properties and our ability to raise
  financing for further development will be adversely impacted.

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

Our business is extremely dependent on the price of gold.
  Our recoveries from sales of gold for the current fiscal year are dependent
  on the price of gold in addition to the quantity of gold that we are able to
  recover. If gold prices decline prior to the production and sale of gold from
  the Nolan Gold Project, then our recoveries from sales of gold and financial
  condition will be adversely impacted. We have not undertaken any hedging transactions
  in order to protect us from a decline in the price of gold. A decline in the
  price of gold may also decrease our ability to obtain future financings to fund
  our planned development and exploration programs.

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

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

If costs of production at our Nolan Gold Project are higher than anticipated,
  then our profitability will be adversely affected.

We have proceeded with the Nolan Gold Project on the basis
  of estimated capital and operating costs. If capital and operating costs are
  greater than anticipated, then the profitability of the production at the Nolan
  Gold Project will be adversely affected. This reduced profitability will cause
  us to have less funds for other expenses, such as administrative and overhead
  expenses and exploration of our other mineral properties and further development
  of the Nolan Gold Project.

If our exploration costs are higher than anticipated, then
  our profitability will be adversely affected.

We are currently proceeding with exploration of our mineral
  properties on the basis of estimated exploration costs. This exploration program
  includes drilling programs at various locations within the Nolan Gold Project.
  If our exploration costs are greater than anticipated, then we will have less
  funds for other expenses, such as expenses associated with mining and development
  of the Nolan Gold Project. If higher exploration costs reduce the amount of
  funds available for production of gold through mining and development activities,
  then our ability to achieve revenues and profitability will be adversely affected.
  Factors that could cause exploration costs to increase are: adverse weather
  conditions, difficult terrain and shortages of qualified personnel.

Mining exploration, development and operating activities
  are inherently hazardous.

Mineral exploration involves many risks that even a combination
  of experience, knowledge and careful evaluation may not be able to overcome.
  Operations that we undertake will be subject to all the hazards and risks normally
  incidental to exploration, development and production of gold and other metals,
  any of which could result in work stoppages, damage to property and possible
  environmental damage. The nature of these risks are such that liabilities might
  result in us being forced to incur significant costs that could have a material
  adverse effect on our financial condition and business prospects.

Our estimates of reserves are subject to uncertainty.

Estimates of reserves, including the estimates in our Annual
  Report on Form 10-KSB for the year ended November 30, 2003, are subject to considerable
  uncertainty. Such estimates are arrived at using standard acceptable geological
  techniques, and are based on the interpretations of geological data obtained
  from drill holes and other sampling techniques. Engineers use feasibility studies
  to derive estimates of cash operating costs based on anticipated tonnage and
  grades of ore to be mined and processed, the predicted configuration of the
  ore bodies, expected recovery rates of metal from ore, comparable facility and
  operating costs and other factors. Actual cash operating costs and economic
  returns on projects may differ significantly from the original estimates, primarily
  due to fluctuations in the current prices of metal commodities extracted from
  the deposits,

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changes in fuel costs, labor rates, changes in permit requirements,
  and unforeseen variations in the characteristics of the ore body. Due to the
  presence of these factors, there is no assurance that our reported proven and
  probable reserves reflect actual quantities of gold that can be economically
  processed and mined by us.

If we experience mining accidents or other adverse events
  at our Nolan Gold Project, then our financial condition and profitability could
  be adversely affected.

Our mining operations at the Nolan Gold Project are subject
  to adverse operating conditions. Mining accidents or other adverse incidents,
  such as cave-ins or flooding, could affect our ability to continue development
  and production of the Nolan Gold Project. A particular concern at the Nolan
  Gold Project is warm temperatures that can reduce the winter season during which
  we can safely conduct underground mining activities. The occurrence of any of
  these events could cause a delay in production of gold or could reduce the amount
  of gold that we are able to produce, with the result that our ability to achieve
  revenues and to sustain operations would be adversely impacted. Adverse operating
  conditions may also cause our operating costs to increase. Mining accidents
  or other adverse events could also result in an adverse environmental impact
  to the land on which our operations are located with the result that we may
  become subject to the liabilities for environmental clean up and remediation.

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

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

As we have not reported revenues in recent fiscal periods,
  there is no assurance that we will be able to continue as a going concern.

Our financial statements included with our Annual Report on
  Form 10-KSB for the year ended November 30, 2003 have been prepared assuming
  that we will continue as a going concern. Our auditors have made reference to
  the substantial doubt as to our ability to continue as a going concern in their
  audit report on our audited financial statements for the year ended November
  30, 2003. If we are not able to achieve revenues, then we may not be able to
  continue as a going concern and our financial condition and business prospects
  will be adversely affected.

Because of the speculative nature of exploration of mineral
  properties, there is no assurance that our exploration activities will result
  in the discovery of new commercially exploitable quantities of minerals or that
  the amount of our proven and probable reserves will increase as a result of
  new exploration.

We plan to continue exploration on our mineral properties.
  The search for valuable minerals as a business is extremely risky. We can provide
  investors with no assurance that additional exploration on our properties will
  establish that additional commercially exploitable reserves of gold exist on
  our properties. Problems such as unusual or unexpected geological formations
  or other variable conditions are involved in exploration and often result in
  exploration efforts being unsuccessful. The additional potential problems include,
  but are not limited to, unanticipated problems relating to exploration and attendant
  additional costs and expenses that may exceed current estimates. These risks
  may result in us being unable to establish the presence of additional commercial
  quantities of ore on our mineral claims with the result that our ability to
  fund future exploration activities may be impeded.

As we face intense competition in the mining industry,
  we will have to compete with our competitors for financing and for qualified
  managerial and technical employees.

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The mining industry is intensely competitive in all of its
  phases. Competition includes large established mining companies with substantial
  capabilities and with greater financial and technical resources than we have.
  As a result of this competition, we may be unable to acquire additional attractive
  mining claims or financing on terms we consider acceptable. We also compete
  with other mining companies in the recruitment and retention of qualified managerial
  and technical employees. If we are unable to successfully compete for financing
  or for qualified employees, our exploration and development programs may be
  slowed down or suspended.

Our business venture into the low rank coal water fuel
  business is subject to a high risk of failure.

Our business venture into the low rank coal water fuel technology
  business is at a very early stage and is subject to a high risk of failure.
  The low rank coal water fuel technology has not been proven by us to be a commercially
  viable fuel alternative. In order to establish commercial viability, we will
  have to undertake the construction and operation of the contemplated demonstration
  facility. The construction of the demonstration facility would cost approximately
  $20 million. Even if the demonstration facility were constructed and operational,
  there is no assurance that the commercial viability of this process would be
  established or that we would be able to expand the facility into a commercially
  viable operation or to generate revenues from this technology. We have applied
  to the Department of Energy for a grant to fund the construction of the demonstration
  facility. Our initial application has been rejected. While we intend to resubmit
  for a second round of funding grants, there is no assurance that our application
  will be accepted. Even if the grant were obtained and the demonstration facility
  constructed, we will still require additional financing and there is no assurance
  that we would be able to generate profits or revenues from the operations or
  be able to repay the Department of Energy grant.

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PART II - OTHER INFORMATION

Item 1 Legal Proceedings

The Company currently is not a party to any material legal proceedings and to the Companys knowledge, no such proceedings are threatened or contemplated.

Item 2 Changes in Securities and Use of Proceeds.

We completed the following unregistered sales of securities during the three
  months ended February 29, 2004:

|1. | On December 1, 2003, we issued 1,119,342 shares to
        the holders of our replacement debentures, at the average market price
        of $0.11 per share. No commissions or fees were paid in connection with
        the issuance of the shares. The sales were completed pursuant to Regulation
        S of the Act on the basis that each holder of the replacement debentures
        is a non-U.S. person, as defined under Regulation S of the Act.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
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|2. | On January 9, 2004, we completed a private placement
        with one investor of 4,000,000 units at a price of $0.075 per unit for
        total proceeds of $300,000. Each unit consisted of one common share and
        one common share purchase warrant. Each common share purchase warrant
        entitles the warrant holder to purchase one common share at the price
        of $0.125 per share until January 9, 2005. A commission of $30,000 was
        paid in connection with the offering. The sales were completed pursuant
        to Regulation S of the Act on the basis that each purchaser is a non-U.S.
        person, as defined under Regulation S of the Act. All securities issued
        were endorsed with a restrictive legend confirming that the securities
        had been issued pursuant to Regulation S of the Act and were restricted
        securities under the Act and could not be resold without registration
        under the Act or an applicable exemption from the registration requirements
        of the Act.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|3. | We entered into warrant exercise agreements with each
        of investors who purchased an aggregate of 11,750,000 units at a price
        of $0.10 per unit for total proceeds of $1,175,000 in August and September
        of 2003 pursuant to Rule 506 of Regulation D of the Act. Each unit purchased
        consisted of one common share and one common share purchase warrant. Under
        the terms of the warrant exercise agreements, we agreed that the investors
        would be entitled to exercise their share purchase warrants at a reduced
        exercise price of $0.075 per share, provided the selling shareholder exercised
        their share purchase warrants by December 31, 2003. Upon exercise by any
        of the selling shareholders of their share purchase warrants in accordance
        with the warrant exercise agreements, we agreed to issue to the selling
        shareholder additional warrants to purchase a number of our common shares
        equal to the number of share purchase warrants exercised, which additional
        warrants will be exercisable for a period from the date of issue to January
        10, 2005 at an exercise price, subject to adjustment, of $0.20 US per
        share (the Replacement Warrants). Notwithstanding the exercise
        price of the Replacement Warrants, we have agreed that the selling shareholders
        will be entitled to exercise the Replacement Warrants at a reduced exercise
        price of $0.075 per share, provided that:

| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) | in aggregate, a total of 5,000,000 of the Replacement
        Warrants are exercised by selling shareholders on or before January 10,
        2004;                                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (b) | in the event that, in aggregate, more than 5,000,000
        of the Replacement Warrants are exercised on or before January 10, 2004,
        then the number of Replacement Warrants deemed exercised by each selling
        shareholder exercising their Replacement Warrants will be reduced according
        to the following formula such that in aggregate 5,000,000 Replacement
        Warrants will have been exercised:

| | Number of Replacement  |   | 5,000,000 x | [Number of Replacement          
| | ---------------------- | - | ----------- | --------------------------------
| | Warrants Deemed        | = |             | Warrants Exercised a            
| | Exercised by a Selling |   |             | Selling Shareholder]            
| | Shareholder            |   |             |                                 
| |                        |   |             |                                 
| |                        |   |             | [Aggregate Number of Replacement
| |                        |   |             | Warrants Exercised]             

21

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| | In the event the Replacement Warrants are exercised
        at the reduced exercise price of $0.075 per share on or before January
        10, 2004 in accordance with warrant exercise agreements, we will:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                             

| | (a) | issue to each selling shareholder who has exercised their Replacement
      Warrants additional warrants to purchase an additional number shares of
      the Company equal to the number of Replacement Warrants exercised, which
      additional warrants will be exercisable for a period from the date of issue
      to January 10, 2005 at an exercise price, subject to adjustment, of $0.20
      US per share (the Additional Replacement Warrants). In aggregate,
      a total of 5,000,000 additional warrants would be issued to the selling
      shareholders exercising their Replacement Warrants; and
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (b) | undertake to expeditiously register:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

| |  | (i)   | the resale of the shares issued to the selling shareholders upon exercise
      of the Replacement Warrants by the selling shareholders (the Replacement
      Warrant Shares). In aggregate, a total of 5,000,000 Replacement Warrant
      Shares issued upon exercise of the Replacement Warrants would be included
      on the registration statement;
| |  | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |       |                                                                                                                                                                                                                                                                                                                                                              
| |  | (ii)  | the resale of the shares issuable to the selling shareholders upon exercise
      of the Additional Replacement Warrants (the Investor Additional Replacement
      Warrant Shares). In aggregate, a total of 5,000,000 Investor Additional
      Replacement Warrant Shares would be included on the registration statement;
      and                    
| |  |       |                                                                                                                                                                                                                                                                                                                                                              
| |  | (iii) | the resale of the shares issuable upon the balance of the unexercised
      Replacement Warrants. In aggregate, a total of 6,750,000 shares issuable
      upon exercise of the unexercised Replacement Warrants would be included
      on the registration statement;                                                                                      

| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | by the filing of a registration statement on Form SB-2, or any other eligible
      form, with the Securities Exchange Commission pursuant to the 1933 Act (the
      Additional Registration Statement). We will pay all required
      expenses and fees in connection with the preparation and filing of the Additional
      Registration Statement. We will be entitled to include additional shares
      and warrant shares held by other investors on the Additional Registration
      Statement. The Additional Registration Statement would be filed with the
      Securities and Exchange Commission no later than 60 days from the date of
      the completion of the exercise of the aggregate of 5,000,000 Replacement
      Warrants in accordance with warrant exercise agreements by the selling shareholders.
| |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

|   | As of December 31, 2003, investors holding an aggregate
        of 11,750,000 share purchase warrants had exercised their share purchase
        warrants pursuant to the warrant exercise agreements. We received aggregate
        proceeds of $881,250 pursuant to these warrant exercises and have issued
        an additional 11,750,000 shares and 11,750,000 Replacement Warrants in
        accordance with the terms of the share purchase warrants and the warrant
        exercise agreements.
      On January 10, 2004, the 5,000,000 Replacement Warrants
        were exercised at a price of $0.075 per share for total proceeds of $575,000
        and 5,000,000 additional shares and 5,000,000 Additional Replacement Warrants
        were issued.                                                                                                                                                                                                                                                                                                 
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|4. | On January 13, 2004, we completed a private placement
        with one investor of 2,666,667 units at a price of $0.075 per unit for
        total proceeds of $200,000. Each unit consisted of one common share and
        one common share purchase warrant. Each common share purchase warrant
        entitles the warrant holder to purchase one common share at the price
        of $0.125 per share, until January 13, 2005. A commission of $20,000 was
        paid in connection with the offering. The sales were completed pursuant
        to Regulation S of the Act on the basis that the purchaser is a non-U.S.
        person, as defined under Regulation S of the Act. All securities issued
        were endorsed with a restrictive legend confirming that the securities
        had been issued pursuant to Regulation S of the Act and were restricted
        securities under the Act and could not be resold without registration
        under the Act or an applicable exemption from the registration requirements
        of the Act.

22

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|5. | On January 13, 2004, we completed a private placement with one investor
      of 3,333,333 units at a price of $0.075 per unit for total proceeds of $250,000.
      Each unit consisted of one common share and one common share purchase warrant.
      Each common share purchase warrant entitles the warrant holder to purchase
      one common share at the price of $0.125 per share until January 13, 2005.
      A commission of $25,000 was paid in connection with the offering. The sales
      were completed pursuant to Regulation S of the Act on the basis that the
      purchaser is a non-U.S. person, as defined under Regulation S of the Act.
      All securities issued were endorsed with a restrictive legend confirming
      that the securities had been issued pursuant to Regulation S of the Act
      and were restricted securities under the Act and could not be
      resold without registration under the Act or an applicable exemption from
      the registration requirements of the Act. 
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|6. | On February 24, 2004, we completed a private placement with one investor
      of 2,666,666 units at a price of $0.075 per unit for total proceeds of $200,000.
      Each unit consisted of one common share and one common share purchase warrant.
      Each common share purchase warrant entitles the warrant holder to purchase
      one common share at the price of $0.15 per share until February 25, 2007.
      A commission of $20,000 was paid in connection with the offering. The sales
      were completed pursuant to Regulation S of the Act on the basis that the
      purchaser is a non-U.S. person, as defined under Regulation S of the Act.
      All securities issued were endorsed with a restrictive legend confirming
      that the securities had been issued pursuant to Regulation S of the Act
      and were restricted securities under the Act and could not be
      resold without registration under the Act or an applicable exemption from
      the registration requirements of the Act.

Item 3 Default Upon Senior Securities

We are currently in default of obligations pursuant to convertible debentures
  in the aggregate principal amount of $140,000, plus accrued interest of $67,627.
  There is no agreement to exchange this amount of remaining original convertible
  debentures into replacement debentures

Item 4  	Submission of Matters to a Vote of Security Holders

No matters were submitted to our security holders for a vote during the fiscal quarter ended August 31, 2003.

Item 5  	Other Information

None.

23

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Item 6  	Exhibits and Reports on Form 8-K

(a) Exhibits

|Exhibit |   |                                                                                                                                                                                             
|------- | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  |   | Description of Exhibit                                                                                                                                                                      
|3.1     |   | Articles of the Company (1)                                                                                                                                                                 
|3.2     |   | Amendment to Articles of the Company (2)                                                                                                                                                    
|3.3     |   | Altered Memorandum of the Company (3)                                                                                                                                                       
|3.4     |   | Amendment to Articles of the Company (8)                                                                                                                                                    
|4.1     |   | Share certificate representing common shares of the capital of the Company
      (1)                                                                                                        
|10.1    |   | Agreement for Conditional Purchase and Sale of Mining Property between
      the Company and Roger C. Burggraf dated October 6, 1978  Grant Mine
      Property (1)                        
|10.2    |   | Agreement for Conditional Purchase and Sale of Mining Property between
      the Company and Paul Barelka, Donald May and Mark Thoennes dated May 12,
      1979  St. Paul Property (1)    
|10.3    |   | Lease of Mining Claims with Option to Purchase between the Company and
      Alaska Mining Company, Inc. dated February 3, 1995  Hammond Property
      (4)                                
|10.4    |   | Change of Control Agreement between the Company and Garry L. Anselmo dated
      May, 1995(6)                                                                                               
|10.5    |   | Change of Control Agreement between the Company and James Dixon dated
      May, 1995 (6)                                                                                                   
|10.6    |   | Amendment to Change of Control Agreement between the Company and Garry
      L. Anselmo (6)                                                                                                 
|10.7    |   | Operating Agreement between the Company and Tri-Con Mining Ltd. dated
      January 1, 1997 (5)                                                                                             
|10.8    |   | Operating Agreement between the Company and Tri-Con Mining Inc. dated
      January 1, 1997 (6)                                                                                             
|10.9    |   | Operating Agreement between the Company and Tri-Con Mining Alaska Inc.
      dated January 1, 1997 (6)                                                                                      
|10.10   |   | Contract between the Company and Dr. Warrack Willson dated March 19, 2001
      (6)                                                                                                         
|10.11   |   | Equipment Lease Agreement between the Company and Airport Equipment Rentals
      Inc. dated October 11, 2002 (6)                                                                           
|10.12   |   | 2003 Stock Option Plan (7)                                                                                                                                                                  
|31.1    |   | Certification of Chief Executive Officer and
      Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
      of 2002(9)                                               
|32.1    |   | Certification of Chief Executive Officer and
      Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
      to Section 906 of the Sarbanes-Oxley Act of 2002(9)
|        |   |                                                                                                                                                                                             
|(1      | ) | Filed as an exhibit to the Companys Registration Statement on Form
      10 filed initially on May 11, 1984, as amended.                                                                   
|(2      | ) | Filed as an exhibit to the Companys Quarterly Report on Form 10-Q
      filed on July 15, 1997.                                                                                            
|(3      | ) | Filed as an exhibit to the Companys Current Report on Form 8-K filed
      on September 11, 2002.                                                                                          
|(4      | ) | Filed as an exhibit to the Companys Annual Report on Form 10-K for
      the year ended November 30, 1995.                                                                                 
|(5      | ) | Filed as an exhibit to the Companys Annual Report on Form 10-K for
      the year ended November 30, 1996.                                                                                 
|(6      | ) | Filed as an exhibit to the Companys Annual Report on Form 10-KSB
      for the year ended November 30, 2002.                                                                               
|(7      | ) | Filed as an exhibit to the Companys Schedule 14A Proxy Statement
      filed April 29, 2003.                                                                                               
|(8      | ) | Filed as an exhibit to the Companys Current Report on Form 8-K filed
      on June 13, 2003.                                                                                               
|(9      | ) | Filed as an exhibit to this Quarterly Report on Form 10-QSB.                                                                                                                                

REPORTS ON FORM 8-K

We did not file any Current Reports on Form 8-K during our fiscal quarter ended
  February 29, 2004.

24

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SIGNATURES

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

|                     | SILVERADO GOLD MINES LTD.    
|-------------------- | -----------------------------
|                     |                              
|DATE: April 14, 2004 |                              
|                     |                              
|                     | /s/ G.L. Anselmo             
|                     | Garry L. Anselmo             
|                     | President                    
|                     | Chief Executive Officer      
|                     | (Principal Executive Officer)
|                     | Chief Financial Officer      
|                     | (Principal Financial Officer)

25

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