---

**UNITED STATES****SECURITIES AND EXCHANGE COMMISSION**
  Washington, DC 20549

FORM 10-QSB

[X]Quarterly Report under Section 13 or 15(d) of the
Securities Exchange Act of 1934

For the quarterly period ended March 31, 2007

[   ]Transition Report under Section 13 or
15(d) of the Securities Exchange Act of 1934

For the transition period from________ to ________

COMMISSION FILE NUMBER **000-30995**

SEARCHLIGHT MINERALS CORP.(Exact name of small business issuer as specified in its
charter)

|NEVADA                                                               | 98-0232244                       
|-------------------------------------------------------------------- | ---------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (IRS Employer Identification No.)

#120 - 2441 West Horizon Ridge Parkway Henderson, NV
89052(Address of principal executive offices)

(702) 939-5247(Issuers telephone number)

N/A(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 [   ]

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

State the number of shares outstanding of each of the issuers
classes of common equity, as of the latest practicable date: As of May 1,
2007, the Issuer had 91,377,187 shares of common stock outstanding.

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

---

PART I - FINANCIAL INFORMATION

ITEM
1.           FINANCIAL
STATEMENTS.

The accompanying unaudited consolidated financial statements
have been prepared in accordance with the instructions to Form 10-QSB and Item
310(b) of Regulation S-B, and, therefore, do not include all information and
footnotes necessary for a complete presentation of financial position, results
of operations, cash flows, and stockholders equity in conformity with generally
accepted accounting principles. In the opinion of management, all adjustments
considered necessary for a fair presentation of the results of operations and
financial position have been included and all such adjustments are of a normal
recurring nature. Operating results for the three months ended March 31, 2007
are not necessarily indicative of the results that can be expected for the year
ending December 31, 2007.

As used in this Quarterly Report on Form 10-QSB, the terms
we, us, our, Searchlight and the Company mean Searchlight Minerals
Corp. unless otherwise indicated. All dollar amounts in this Quarterly Report
are in U.S. dollars unless otherwise stated.

2

---

|SEARCHLIGHT MINERALS CORP.       
|---------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)
|CONSOLIDATED BALANCE SHEETS      
|(UNAUDITED)                      

|                                                    |   | March 31, 2007 |   |   | December 31, 2006 |  
|--------------------------------------------------- | - | -------------- | - | - | ----------------- | -
|                                                    |   |                |   |   |                   |  
|ASSETS                                              |  
|                                                    |   |                |   |   |                   |  
|Current assets                                      |   |                |   |   |                   |  
|Cash                                                | $ | 13,688,258     |   | $ | 3,684,248         |  
|Prepaid expenses                                    |   | 106,249        |   |   | 106,235           |  
|                                                    |   |                |   |   |                   |  
|Total current assets                                |   | 13,794,507     |   |   | 3,790,483         |  
|                                                    |   |                |   |   |                   |  
|Property and equipment, net                         |   | 342,894        |   |   | 30,187            |  
|Mineral properties                                  |   | 127,134        |   |   | 127,134           |  
|Slag project                                        |   | 111,469,191    |   |   | -                 |  
|Land - smelter site and slag pile                   |   | 5,916,150      |   |   | -                 |  
|Land                                                |   | 3,300,000      |   |   | -                 |  
|Deposits                                            |   | 183,040        |   |   | 183,040           |  
|Joint venture option agreement                      |   | -              |   |   | 690,000           |  
|Merger option                                       |   | -              |   |   | 200,000           |  
|                                                    |   |                |   |   |                   |  
|Total non-current assets                            |   | 121,338,409    |   |   | 1,230,361         |  
|                                                    |   |                |   |   |                   |  
|Total assets                                        | $ | 135,132,916    |   | $ | 5,020,844         |  
|                                                    |   |                |   |   |                   |  
|LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)      |  
|                                                    |   |                |   |   |                   |  
|Current liabilities                                 |   |                |   |   |                   |  
|Accounts payable                                    | $ | 919,452        |   | $ | 888,651           |  
|Accounts payable - related party                    |   | 152,638        |   |   | 311,863           |  
|Loan payable - related party                        |   | 382,792        |   |   | 382,792           |  
|VRIC monthly payable, current portion               |   | 335,001        |   |   | -                 |  
|Due to VRIC                                         |   | 6,400,000      |   |   | -                 |  
|                                                    |   |                |   |   |                   |  
|Total current liabilities                           |   | 8,189,883      |   |   | 1,583,306         |  
|                                                    |   |                |   |   |                   |  
|Long-term liabilities                               |   |                |   |   |                   |  
|VRIC monthly payable, net of current portion        |   | 3,252,403      |   |   | -                 |  
|Deferred tax liability Clarkdale
      slag project |   | 33,151,312     |   |   | -                 |  
|                                                    |   |                |   |   |                   |  
|Total long-term
      liabilities                   |   | 36,403,715     |   |   | -                 |  
|                                                    |   |                |   |   |                   |  
|Total liabilities                                   |   | 44,593,598     |   |   | 1,583,306         |  
|                                                    |   |                |   |   |                   |  
|Stockholders' equity                                |   |                |   |   |                   |  
|Common stock, $0.001 par value; 400,000,000 shares  |   |                |   |   |                   |  
|authorized, 91,377,827
      and 67,231,000 shares, |   |                |   |   |                   |  
|respectively, issued and outstanding                |   | 91,378         |   |   | 67,231            |  
|Additional paid-in capital                          |   | 100,656,349    |   |   | 12,898,687        |  
|Accumulated other comprehensive loss                |   | (121,606       | ) |   | (121,606          | )
|Accumulated deficit during development
      stage  |   | (10,086,803    | ) |   | (9,406,774        | )
|                                                    |   |                |   |   |                   |  
|Total stockholders'
      equity                    |   | 90,539,318     |   |   | 3,437,538         |  
|                                                    |   |                |   |   |                   |  
|Total liabilities and stockholders' equity          | $ | 135,132,916    |   | $ | 5,020,844         |  

See Accompanying Notes to these Consolidated Financial Statements

F-1

---

|SEARCHLIGHT MINERALS CORP.           
|-------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)    
|CONSOLIDATED STATEMENTS OF OPERATIONS
|(UNAUDITED)                          

|                                                             |   |                            |   |   |                |   |   | For the period from |  
|------------------------------------------------------------ | - | -------------------------- | - | - | -------------- | - | - | ------------------- | -
|                                                             |   |                            |   |   |                |   |   | January 14, 2000    |  
|                                                             |   |                            |   |   |                |   |   | (Date of Inception) |  
|                                                             |   | For the three months ended |   |   | Through        |  
|                                                             |   | March 31, 2007             |   |   | March 31, 2006 |   |   | March 31, 2007      |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|Revenue - rents                                              | $ | 7,620                      |   | $ | -              |   | $ | 7,620               |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|Operating expenses                                           |   |                            |   |   |                |   |   |                     |  
|Research and development                                     |   | -                          |   |   | -              |   |   | 1,900,095           |  
|Mineral exploration and evaluation
      expenses            |   | 385,308                    |   |   | 402,494        |   |   | 3,792,263           |  
|General and administrative                                   |   | 333,450                    |   |   | 212,932        |   |   | 3,998,447           |  
|Depreciation                                                 |   | 2,789                      |   |   | 793            |   |   | 245,222             |  
|Impairment loss on intangible assets                         |   | -                          |   |   | -              |   |   | 173,234             |  
|Impairment loss on property and
      equipment              |   | -                          |   |   | -              |   |   | 86,683              |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|Total operating
      expenses                               |   | 721,547                    |   |   | 616,219        |   |   | 10,195,944          |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|Loss from operations                                         |   | (713,927                   | ) |   | (616,219       | ) |   | (10,188,324         | )
|                                                             |   |                            |   |   |                |   |   |                     |  
|Other income (expense):                                      |   |                            |   |   |                |   |   |                     |  
|Other income                                                 |   | -                          |   |   | -              |   |   | 282,142             |  
|Loss on equipment disposition                                |   | -                          |   |   | -              |   |   | (4,388              | )
|Interest and dividend income                                 |   | 33,898                     |   |   | -              |   |   | 110,930             |  
|Interest expense, net                                        |   | -                          |   |   | -              |   |   | (300,000            | )
|                                                             |   |                            |   |   |                |   |   |                     |  
|Total other income
      (expense)                           |   | 33,898                     |   |   | -              |   |   | 88,684              |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|Loss from operations before provision for income
      taxes |   | (680,029                   | ) |   | (616,219       | ) |   | (10,099,640         | )
|                                                             |   |                            |   |   |                |   |   |                     |  
|Income tax benefit                                           |   | -                          |   |   | -              |   |   | 12,837              |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|Net loss                                                     |   | (680,029                   | ) |   | (616,219       | ) |   | (10,086,803         | )
|                                                             |   |                            |   |   |                |   |   |                     |  
|Other Comprehensive Loss                                     |   |                            |   |   |                |   |   |                     |  
|Foreign currency translation adjustment                      |   | -                          |   |   | (11,769        | ) |   | (121,606            | )
|                                                             |   |                            |   |   |                |   |   |                     |  
|Comprehensive Loss                                           |   | (680,029                   | ) |   | (627,988       | ) |   | (10,208,409         | )
|                                                             |   |                            |   |   |                |   |   |                     |  
|Loss per common share - basic and diluted                    |   |                            |   |   |                |   |   |                     |  
|Net loss                                                     | $ | (0.01                      | ) | $ | (0.01          | ) |   |                     |  
|                                                             |   |                            |   |   |                |   |   |                     |  
|Weighted average common shares outstanding
      -           |   |                            |   |   |                |   |   |                     |  
|Basic and diluted                                            |   | 77,717,438                 |   |   | 55,882,500     |   |   |                     |  

See Accompanying Notes to these Consolidated Financial Statements

F-2

---

|SEARCHLIGHT MINERALS CORP.                              
|--------------------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)                       
|CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
|(UNAUDITED)                                             

|                                          |  |              |   |  |            |   |   |                 |   |   | Accumulated   |   |   |            |  |   |              |   |   | Accumulated    |   |   |            |  
|----------------------------------------- |  | ------------ | - |  | ---------- | - | - | --------------- | - | - | ------------- | - | - | ---------- |  | - | ------------ | - | - | -------------- | - | - | ---------- | -
|                                          |  |              |   |  |            |   |   |                 |   |   | Other         |   |   | Common     |  |   |              |   |   | Deficit During |   |   | Total      |  
|                                          |  | Common Stock |   |  | Additional |   |   | Comprehensive   |   |   | Stock         |   |   | Deferred   |  |   | Exploration  |   |   | Stockholders'  |  
|                                          |  | Shares       |   |  | Amount     |   |   | Paid-in Capital |   |   | Income (Loss) |   |   | Subscribed |  |   | Compensation |   |   | Stage          |   |   | Equity     |  
|Balance, January 14, 2000                 |  | - $          |   |  | -          |   | $ | -               |   | $ | -             |   | $ | -          |  | $ | -            |   | $ | -              |   | $ | -          |  
|Issuance of common stock                  |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|(recapitalized)                           |  | 50,000,000   |   |  | 50,000     |   |   | (25,000         | ) |   | -             |   |   | -          |  |   | -            |   |   | (24,999        | ) |   | 1          |  
|Effect of foreign currency translation    |  | -            |   |  | -          |   |   | -               |   |   | 3,059         |   |   | -          |  |   | -            |   |   | -              |   |   | 3,059      |  
|Net loss                                  |  | -            |   |  | -          |   |   | -               |   |   | -             |   |   |            |  |   | -            |   |   | (235,028       | ) |   | (235,028   | )
|Balance, December 31, 2000                |  | 50,000,000   |   |  | 50,000     |   |   | (25,000         | ) |   | 3,059         |   |   | -          |  |   | -            |   |   | (260,027       | ) |   | (231,968   | )
|Issuance of common stock in               |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|reverse merger                            |  | 10,300,000   |   |  | 10,300     |   |   | (5,150          | ) |   | -             |   |   | -          |  |   | -            |   |   | (5,150         | ) |   | -          |  
|Effect of foreign currency translation    |  | -            |   |  | -          |   |   | -               |   |   | (2,619        | ) |   | -          |  |   | -            |   |   | -              |   |   | (2,619     | )
|Net loss                                  |  | -            |   |  | -          |   |   | -               |   |   | -             |   |   | -          |  |   | -            |   |   | (765,179       | ) |   | (765,179   | )
|Balance, December 31, 2001                |  | 60,300,000   |   |  | 60,300     |   |   | (30,150         | ) |   | 440           |   |   | -          |  |   | -            |   |   | (1,030,356     | ) |   | (999,766   | )
|Capital contribution                      |  | -            |   |  | -          |   |   | 1,037,126       |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 1,037,126  |  
|Beneficial conversion feature             |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|associated with debt                      |  | -            |   |  | -          |   |   | 300,000         |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 300,000    |  
|Effect of foreign currency translation    |  | -            |   |  | -          |   |   | -               |   |   | (70,248       | ) |   | -          |  |   | -            |   |   | -              |   |   | (70,248    | )
|Net loss                                  |  | -            |   |  | -          |   |   | -               |   |   | -             |   |   | -          |  |   | -            |   |   | (1,179,396     | ) |   | (1,179,396 | )
|Balance, December 31, 2002                |  | 60,300,000   |   |  | 60,300     |   |   | 1,306,976       |   |   | (69,808       | ) |   | -          |  |   | -            |   |   | (2,209,752     | ) |   | (912,284   | )
|Debt exchanged for common stock           |  | 48,000,000   |   |  | 48,000     |   |   | 1,152,000       |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 1,200,000  |  
|Deferred compensation                     |  | -            |   |  | -          |   |   | 12,583          |   |   | -             |   |   | -          |  |   | (12,583      | ) |   | -              |   |   | -          |  
|Amortization of deferred                  |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|compensation                              |  | -            |   |  | -          |   |   | -               |   |   | -             |   |   | -          |  |   | 10,387       |   |   | -              |   |   | 10,387     |  
|Effect of foreign currency translation    |  | -            |   |  | -          |   |   | -               |   |   | (50,755       | ) |   | -          |  |   | -            |   |   | -              |   |   | (50,755    | )
|Net loss                                  |  | -            |   |  | -          |   |   | -               |   |   | -             |   |   | -          |  |   | -            |   |   | (1,233,117     | ) |   | (1,233,117 | )
|Balance, December 31, 2003                |  | 108,300,000  |   |  | 108,300    |   |   | 2,471,559       |   |   | (120,563      | ) |   | -          |  |   | (2,196       | ) |   | (3,442,869     | ) |   | (985,769   | )
|Amortization of deferred                  |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|compensation                              |  | -            |   |  | -          |   |   | -               |   |   | -             |   |   | -          |  |   | 2,196        |   |   | -              |   |   | 2,196      |  
|Effect of foreign currency translation    |  | -            |   |  | -          |   |   | -               |   |   | (109,982      | ) |   | -          |  |   | -            |   |   | -              |   |   |            |  
|Net loss                                  |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   | (590,462       | ) |   |            |  
|Net comprehensive loss                    |  | -            |   |  | -          |   |   | -               |   |   | -             |   |   | -          |  |   | -            |   |   |                |   |   | (700,444   | )
|Balance, December 31, 2004                |  | 108,300,000  |   |  | 108,300    |   |   | 2,471,559       |   |   | (230,545      | ) |   | -          |  |   | -            |   |   | (4,033,331     | ) |   | (1,684,017 | )
|Issuance of stock options for             |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|1,000,000 shares of common stock          |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|to two officers                           |  | -            |   |  | -          |   |   | 133,062         |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 133,062    |  
|Issuance of stock options for             |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|500,000 shares of common stock            |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|in satisfaction of debt                   |  | -            |   |  | -          |   |   | 300,000         |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 300,000    |  
|Return and cancellation of                |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|70,000,000 shares of common               |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|stock                                     |  | (70,000,000  | ) |  | (70,000    | ) |   | 70,000          |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | -          |  
|Issuance of common stock                  |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|for 20 mining claims                      |  | 1,400,000    |   |  | 1,400      |   |   | 38,600          |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 40,000     |  
|Issuance of common stock                  |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|in satisfaction of debt, $0.625 per share |  | 200,000      |   |  | 200        |   |   | 124,800         |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 125,000    |  
|Issuance of common stock for cash,        |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|Reg. S - Private Placement,               |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|$0.25 per share, net of                   |  |              |   |  |            |   |   |                 |   |   |               |   |   |            |  |   |              |   |   |                |   |   |            |  
|$205,250 commissions                      |  | 6,390,000    |   |  | 6,390      |   |   | 1,369,070       |   |   | -             |   |   | -          |  |   | -            |   |   | -              |   |   | 1,375,460  |  

See Accompanying Notes to these Consolidated Financial Statements

F-3

---

|SEARCHLIGHT MINERALS CORP.                              
|--------------------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)                       
|CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
|(UNAUDITED)                                             

|                                       |  |              |  |   |            |  |   |                 |   |   | Accumulated   |   |   |            |   |   |              |  |   | Accumulated    |   |   |            |  
|-------------------------------------- |  | ------------ |  | - | ---------- |  | - | --------------- | - | - | ------------- | - | - | ---------- | - | - | ------------ |  | - | -------------- | - | - | ---------- | -
|                                       |  |              |  |   |            |  |   |                 |   |   | Other         |   |   | Common     |   |   |              |  |   | Deficit During |   |   | Total      |  
|                                       |  | Common Stock |  |   | Additional |  |   | Comprehensive   |   |   | Stock         |   |   | Deferred   |   |   | Exploration  |  |   | Stockholders'  |  
|                                       |  | Shares       |  |   | Amount     |  |   | Paid-in Capital |   |   | Income (Loss) |   |   | Subscribed |   |   | Compensation |  |   | Stage          |   |   | Equity     |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash,     |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Reg. S - Private Placement,            |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$0.25 per share, net of                |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$135,000 commission                    |  | 5,400,000    |  |   | 5,400      |  |   | 1,194,947       |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 1,200,347  |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash,     |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Reg. D 506 - Private Placement,        |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$0.25 per share                        |  | 460,000      |  |   | 460        |  |   | 114,540         |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 115,000    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of stock options for          |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|1,500,000 shares of common stock       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|to three officers                      |  | -            |  |   | -          |  |   | 266,720         |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 266,720    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Common stock subscribed                |  | -            |  |   | -          |  |   | -               |   |   | -             |   |   | 270,000    |   |   | -            |  |   | -              |   |   | 270,000    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Effect of foreign currency translation |  | -            |  |   | -          |  |   | -               |   |   | 120,708       |   |   | -          |   |   | -            |  |   | -              |   |   |            |  
|Net loss                               |  | -            |  |   | -          |  |   | -               |   |   | -             |   |   | -          |   |   | -            |  |   | (1,721,777     | ) |   | -          |  
|Net comprehensive loss                 |  | -            |  |   | -          |  |   | -               |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | (1,601,069 | )
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Balance, December 31, 2005             |  | 52,150,000   |  | $ | 52,150     |  | $ | 6,083,298       |   | $ | (109,837      | ) | $ | 270,000    |   | $ | -            |  | $ | (5,755,108     | ) | $ | 540,503    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash,     |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Reg. D - Private Placement,            |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$0.45 per share, net of                |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$87,750 commission                     |  | 3,900,000    |  |   | 3,900      |  |   | 1,663,350       |   |   | -             |   |   | (270,000   | ) |   | -            |  |   | -              |   |   | 1,397,250  |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock               |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|related to exercise of warrants        |  | 1,225,000    |  |   | 1,225      |  |   | (1,225          | ) |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | -          |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of stock options for          |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|120,000 shares of common stock         |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|to two officers                        |  | -            |  |   | -          |  |   | 20,864          |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 20,864     |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of stock options for          |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|500,000 shares of common stock         |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|to two directors                       |  | -            |  |   | -          |  |   | 122,420         |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 122,420    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of stock options for          |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|100,000 shares of common stock         |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|to two directors                       |  | -            |  |   | -          |  |   | 24,484          |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 24,484     |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash      |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Reg. S - Private Placement,            |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$0.625 per share                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|from exercise of warrants              |  | 6,125,000    |  |   | 6,125      |  |   | 3,822,000       |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 3,828,125  |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash      |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Reg. S - Private Placement,            |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$0.375 per share                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|from exercise of warrants              |  | 1,768,500    |  |   | 1,768      |  |   | 661,420         |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 663,188    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash      |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Reg. S - Private Placement,            |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|$0.625 per share                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|from exercise of warrants              |  | 612,500      |  |   | 613        |  |   | 382,200         |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 382,813    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of stock options for          |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|100,000 shares of common stock         |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|to officer for recruitment             |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|amortized over vesting period.         |  | -            |  |   | -          |  |   | 1,309           |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 1,309      |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock to            |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|officer for recruitment                |  | 50,000       |  |   | 50         |  |   | 102,950         |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 103,000    |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of stock options for          |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|50,000 shares of common stock          |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|to employee for recruitment            |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|amortized over vesting period.         |  | -            |  |   | -          |  |   | 1,309           |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 1,309      |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Effect of foreign currency translation |  | -            |  |   | -          |  |   | -               |   |   | (11,769       | ) |   | -          |   |   | -            |  |   | -              |   |   | -          |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Issuance of common stock               |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|for mining claims recorded             |  | 1,400,000    |  |   | 1,400      |  |   | (1,400          | ) |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | -          |  
|at initial transaction                 |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Amortization of stock options issued   |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|to employee and officer over           |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|vesting period                         |  | -            |  |   | -          |  |   | 15,708          |   |   | -             |   |   | -          |   |   | -            |  |   | -              |   |   | 15,708     |  
|                                       |  |              |  |   |            |  |   |                 |   |   |               |   |   |            |   |   |              |  |   |                |   |   |            |  
|Net loss December 31, 2006             |  | -            |  |   | -          |  |   | -               |   |   | -             |   |   | -          |   |   | -            |  |   | (3,651,666     | ) |   | -          |  

See Accompanying Notes to these Consolidated Financial Statements

F-4

---

|SEARCHLIGHT MINERALS CORP.                              
|--------------------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)                       
|CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
|(UNAUDITED)                                             

|                                      |  |              |  |   |            |  |   |                 |  |   | Accumulated   |   |   |            |  |   |              |  |   | Accumulated    |   |   |            |  
|------------------------------------- |  | ------------ |  | - | ---------- |  | - | --------------- |  | - | ------------- | - | - | ---------- |  | - | ------------ |  | - | -------------- | - | - | ---------- | -
|                                      |  |              |  |   |            |  |   |                 |  |   | Other         |   |   | Common     |  |   |              |  |   | Deficit During |   |   | Total      |  
|                                      |  | Common Stock |  |   | Additional |  |   | Comprehensive   |  |   | Stock         |   |   | Deferred   |  |   | Exploration  |  |   | Stockholders'  |  
|                                      |  | Shares       |  |   | Amount     |  |   | Paid-in Capital |  |   | Income (Loss) |   |   | Subscribed |  |   | Compensation |  |   | Stage          |   |   | Equity     |  
|Net comprehensive loss                |  | -            |  |   | -          |  |   | -               |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | (3,663,435 | )
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Balance, December 31, 2006            |  | 67,231,000   |  | $ | 67,231     |  | $ | 12,898,687      |  | $ | (121,606      | ) | $ | -          |  | $ | -            |  | $ | (9,406,774     | ) | $ | 3,437,538  |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Issuance of common stock              |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|in connection with the acquisition to |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|five investors, $3.975 per share      |  | 16,825,000   |  |   | 16,825     |  |   | 66,862,550      |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | 66,879,375 |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Issuance of stock options for         |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|75,700 shares of common stock         |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|to three officers and employee        |  | -            |  |   | -          |  |   | 124,058         |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | 124,058    |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash     |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Reg. D - Private Placement,           |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|$3.00 per share, net of $381,990      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|commission and $79,513 issuance costs |  | 4,520,666    |  |   | 4,521      |  |   | 13,095,978      |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | 13,100,499 |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash     |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Reg. S - Private Placement,           |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|$3.00 per share, net of $111,100      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|commission and $8,842 issuance costs  |  | 575,000      |  |   | 575        |  |   | 1,604,483       |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | 1,605,058  |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Issuance of common stock for cash     |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Reg. S - Private Placement,           |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|$3.00 per share, net of $525,386      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|commission and $85,513 issuance costs |  | 2,226,161    |  |   | 2,226      |  |   | 6,065,358       |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | 6,067,584  |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Amortization of stock options issued  |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|to employee and officer over          |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|vesting period                        |  | -            |  |   | -          |  |   | 5,235           |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | 5,235      |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Net loss March 31, 2007               |  | -            |  |   | -          |  |   | -               |  |   | -             |   |   | -          |  |   | -            |  |   | (680,029       | ) |   | -          |  
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Net comprehensive loss                |  | -            |  |   | -          |  |   | -               |  |   | -             |   |   | -          |  |   | -            |  |   | -              |   |   | (680,029   | )
|                                      |  |              |  |   |            |  |   |                 |  |   |               |   |   |            |  |   |              |  |   |                |   |   |            |  
|Balance, March 31, 2007               |  | 91,377,827   |  | $ | 91,378     |  | $ | 100,656,349     |  | $ | (121,606      | ) | $ | -          |  | $ | -            |  | $ | (10,086,803    | ) | $ | 90,539,318 |  

See Accompanying Notes to these Consolidated Financial Statements

F-5

---

|SEARCHLIGHT MINERALS CORP.           
|-------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)    
|CONSOLIDATED STATEMENTS OF CASH FLOWS
|(UNAUDITED)                          

|                                                       |   |                            |   |   |                |   |   | Period from         |  
|------------------------------------------------------ | - | -------------------------- | - | - | -------------- | - | - | ------------------- | -
|                                                       |   |                            |   |   |                |   |   | January 14, 2000    |  
|                                                       |   |                            |   |   |                |   |   | (Date of inception) |  
|                                                       |   | For the three months ended |   |   | through        |  
|                                                       |   | March 31, 2007             |   |   | March 31, 2006 |   |   | March 31, 2007      |  
|CASH FLOWS FROM OPERATING ACTIVITIES                   |   |                            |   |   |                |   |   |                     |  
|Net loss                                               | $ | (680,029                   | ) | $ | (616,219       | ) | $ | (10,086,803         | )
|Adjustments to reconcile loss from operating           |   |                            |   |   |                |   |   |                     |  
|to net cash
        used in operating activities:      |   |                            |   |   |                |   |   |                     |  
|Amortization
      of debt discount                    |   | -                          |   |   | -              |   |   | 300,000             |  
|Depreciation                                           |   | 2,789                      |   |   | 793            |   |   | 245,222             |  
|Stock based
      expenses                             |   | 129,293                    |   |   | -              |   |   | 837,115             |  
|Impairment loss                                        |   | -                          |   |   | -              |   |   | 259,917             |  
|Gain on settlement                                     |   | -                          |   |   | -              |   |   | (228,636            | )
|Loss on disposition of fixed
      assets              |   | -                          |   |   | -              |   |   | 5,737               |  
|Changes in operating assets and liabilities:           |   |                            |   |   |                |   |   |                     |  
|Amounts receivable                                     |   | -                          |   |   | -              |   |   | 11,005              |  
|Other current
      assets                             |   | -                          |   |   | -              |   |   | (106,235            | )
|Other assets                                           |   | (13                        | ) |   | (1,998         | ) |   | (183,053            | )
|Accounts
      payable and accrued liabilities         |   | (242,713                   | ) |   | 56,011         |   |   | 795,437             |  
|                                                       |   |                            |   |   |                |   |   |                     |  
|Net cash used in operating activities                  |   | (790,673                   | ) |   | (561,413       | ) |   | (8,150,294          | )
|                                                       |   |                            |   |   |                |   |   |                     |  
|CASH FLOW FROM INVESTING ACTIVITIES                    |   |                            |   |   |                |   |   |                     |  
|Cash paid on mineral property claims                   |   | -                          |   |   | -              |   |   | (777,134            | )
|Cash paid for merger option                            |   | -                          |   |   | -              |   |   | (200,000            | )
|Cash paid for intangible assets                        |   | -                          |   |   | -              |   |   | (180,068            | )
|Cash paid to VRIC on closing date                      |   | (9,900,000                 | ) |   | -              |   |   | (9,900,000          | )
|Cash paid for additional acquisition costs             |   | (82,158                    | ) |   | -              |   |   | (82,158             | )
|Purchase of fixed assets                               |   | (5,746                     | ) |   | -              |   |   | (320,129            | )
|                                                       |   |                            |   |   |                |   |   |                     |  
|Net cash used in investing activities                  |   | (9,987,904                 | ) |   | -              |   |   | (11,459,489         | )
|                                                       |   |                            |   |   |                |   |   |                     |  
|CASH FLOW FROM FINANCING ACTIVITIES                    |   |                            |   |   |                |   |   |                     |  
|Proceeds from stock issuance                           |   | 21,453,817                 |   |   | 1,397,250      |   |   | 30,416,001          |  
|Stock issuance costs                                   |   | (611,230                   | ) |   | -              |   |   | (611,230            | )
|Proceeds from borrowings from related party            |   | -                          |   |   | -              |   |   | 2,880,201           |  
|Proceeds/payments on loan payable                      |   | -                          |   |   | (15,000        | ) |   | 504,035             |  
|Cash paid on deferred purchase liability               |   | (60,000                    | ) |   | -              |   |   | (60,000             | )
|Proceeds from subscribed stock                         |   | -                          |   |   | -              |   |   | 270,000             |  
|                                                       |   |                            |   |   |                |   |   |                     |  
|Net cash provided by financing activities              |   | 20,782,587                 |   |   | 1,382,250      |   |   | 33,399,007          |  
|                                                       |   |                            |   |   |                |   |   |                     |  
|EFFECT OF FOREIGN CURRENCY EXCHANGE RATE ON
      CASH |   | -                          |   |   | -              |   |   | (100,966            | )
|                                                       |   |                            |   |   |                |   |   |                     |  
|NET CHANGE IN CASH                                     |   | 10,004,010                 |   |   | 820,837        |   |   | 13,688,258          |  
|                                                       |   |                            |   |   |                |   |   |                     |  
|CASH AT BEGINNING OF PERIOD                            |   | 3,684,248                  |   |   | 705,856        |   |   | -                   |  
|                                                       |   |                            |   |   |                |   |   |                     |  
|CASH AT END OF PERIOD                                  |   | 13,688,258                 |   | $ | 1,526,693      |   |   | 13,688,258          |  
|                                                       |   |                            |   |   |                |   |   |                     |  

See Accompanying Notes to these Consolidated Financial Statements

F-6

---

|SEARCHLIGHT MINERALS CORP.           
|-------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)    
|CONSOLIDATED STATEMENTS OF CASH FLOWS
|(UNAUDITED)                          



|                                                                    |   |                            |  |   |                |  |  | Period from         | 
|------------------------------------------------------------------- | - | -------------------------- |  | - | -------------- |  |  | ------------------- | 
|                                                                    |   |                            |  |   |                |  |  | January 14, 2000    | 
|                                                                    |   |                            |  |   |                |  |  | (Date of inception) | 
|                                                                    |   | For the three months ended |  |   | through        | 
|                                                                    |   | March 31, 2007             |  |   | March 31, 2006 |  |  | March 31, 2007      | 
|CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)                   |   |                            |  |   |                |  |  |                     | 
|SUPPLEMENTAL INFORMATION                                            |   |                            |  |   |                |  |  |                     | 
|Interest Paid                                                       | $ | -                          |  | $ | - $            |  |  | 50,751              | 
|Income Taxes Paid                                                   | $ | -                          |  | $ | - $            |  |  | -                   | 
|Non-cash investing and financing activities:                        |   |                            |  |   |                |  |  |                     | 
|Assets acquired for common stock issued for the acquisition         | $ | 66,879,375                 |  | $ | - $            |  |  | 66,879,375          | 
|Assets acquired for liabilities incurred
      in the acquisition   | $ | 43,328,821                 |  | $ | - $            |  |  | 43,328,821          | 
|Merger option payment applied to the acquisition                    | $ | 200,000                    |  | $ | - $            |  |  | 200,000             | 
|Reclassify joint venture option agreement
      to slag project     | $ | 690,000                    |  | $ | - $            |  |  | 690,000             | 
|Financing costs in accounts payable                                 | $ | 66,341                     |  | $ | - $            |  |  | 66,341              | 
|Acquisition costs in accounts payable                               | $ | 2,834                      |  | $ | - $            |  |  | 2,834               | 
|Stock options for common stock issued in satisfaction
      of debt | $ | -                          |  | $ | - $            |  |  | 1,200,000           | 
|Stock issued for conversion of                                      |   |                            |  |   |                |  |  |                     | 
|accounts payable, 100,000 shares at $0.72                           | $ | -                          |  | $ | - $            |  |  | 72,000              | 
|Stock issued for compensation                                       |   |                            |  |   |                |  |  |                     | 
|50,000 shares at $2.06                                              | $ | -                          |  | $ | - $            |  |  | 103,000             | 





See Accompanying Notes to these Consolidated Financial Statements

F-7

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY
      OF SIGNIFICANT POLICIES
|-- | --------------------------------------------------------------------------

Basis of presentation - The accompanying
  unaudited financial statements have been prepared in accordance with Securities
  and Exchange Commission requirements for interim financial statements. Therefore,
  they do not include all of the information and footnotes required by accounting
  principles generally accepted in the United States for complete financial statements.
  The financial statements should be read in conjunction with the Form 10-KSB
  for the year ended December 31, 2006 of Searchlight Minerals Corp. (the "Company").

The interim financial statements present
  the balance sheet, statements of operations and cash flows of the Company. The
  financial statements have been prepared in accordance with accounting principles
  generally accepted in the United States.

The interim financial information is
  unaudited. In the opinion of management, all adjustments necessary to present
  fairly the financial position as of March 31, 2007 and the results of operations
  and cash flows presented herein have been included in the financial statements.
  Interim results are not necessarily indicative of results of operations for
  the full year.

Description of business 
  Searchlight Minerals Corp. referred to as the Company is considered
  an exploration stage company since its formation and the Company has not yet
  realized any revenues from its planned operations. The Company is primarily
  focused on the exploration, acquisition development of mining and mineral properties.
  Upon the location of commercially minable reserves, the Company plans to prepare
  for mineral extraction and enter the development stage.

History - The Company was incorporated
  on January 12, 1999 pursuant to the laws of the State of Nevada under the name
  L.C.M. Equity, Inc. From 1999 to 2005, the Company operated primarily as a biotechnology
  research and development company with its headquarters in Canada and an office
  in the UK. On November 2, 2001, the Company entered into an acquisition agreement
  with Regma Bio Technologies, Ltd. pursuant to which Regma Bio Technologies,
  Ltd. entered into a reverse merger with us with the surviving entity named Regma
  Bio Technologies Limited. On February 2, 2004, the Company changed its
  name from Regma Bio Technologies Limited to Phage Genomics,
  Inc. In February, 2005, the Company announced its reorganization from
  a biotechnology research and development company to a company focused on the
  development and acquisition of mineral properties. In connection with its reorganization
  the Company entered into mineral option agreements to acquire an interest in
  the Searchlight Claims. Also in connection with its corporate restructuring,
  its board of directors approved a change in its name from Phage Genomics,
  Inc. to "Searchlight Minerals Corp. effective June 23, 2005.

On February 10, 2005, the Company announced
  that it was reorganizing itself and changing its focus from biotech to becoming
  a mineral exploration company, dedicated to the discovery and exploitation of
  gold and other precious metal deposits. The Company has consequently been considered
  an exploration stage enterprise.

F-8

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT
        POLICIES(continued)
|-- | ---------------------------------------------------------------------------------------

Going concern - The Company incurred
  cumulative net losses of approximately $10,099,640 from operations as of March
  31, 2007 and has not commenced its mining and mineral processing operations,
  rather, still in the exploration stage, raising substantial doubt about the
  Companys ability to continue as a going concern.

The Company will seek additional sources
  of capital through the issuance of debt or equity financing, but there can be
  no assurance the Company will be successful in accomplishing its objectives.

The ability of the Company to continue
  as a going concern is dependent on additional sources of capital and the success
  of the Companys plan. The financial statements do not include any adjustments
  that might be necessary if the Company is unable to continue as a going concern.

Principles of consolidation 
  The consolidated financial statements include the accounts of the Company and
  its wholly-owned subsidiaries, Clarkdale Minerals, LLC (CML) and Clarkdale Metals,
  Corp. (CMC). Significant intercompany accounts and transactions have been eliminated.

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

Cash and cash equivalents - Cash
  and cash equivalents include cash deposits residing in checking, interest bearing
  checking accounts, money market funds and sweep accounts. Cash equivalents consist
  of highly liquid short term investments. We consider all highly liquid marketable
  securities with maturities of less than 91 days at date of purchase to be cash
  equivalents.

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

Exploration costs  Mineral
  exploration costs are expensed as incurred.

Fixed assets - Fixed assets are
  stated at cost less accumulated depreciation. Depreciation is provided principally
  on the straight-line method over the estimated useful lives of the assets, which
  are generally 3 to 39 years. The cost of repairs and maintenance is charged
  to expense as incurred. Expenditures for property betterments and renewals are
  capitalized. Upon sale or other disposition of a depreciable asset, cost and
  accumulated depreciation are removed from the accounts and any gain or loss
  is reflected in other income (expense).

The Company periodically evaluates whether
  events and circumstances have occurred that may warrant revision of the estimated
  useful life of fixed assets or whether the remaining balance of fixed assets
  should be evaluated for possible impairment. The Company uses an estimate of
  the related undiscounted cash flows over the remaining life of the fixed assets
  in measuring their recoverability.

F-9

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT
        POLICIES(continued)
|-- | ---------------------------------------------------------------------------------------

Impairment of long-lived assets
  - We review and evaluate our long-lived assets for impairment at least annually
  and also when events or changes in circumstances indicate the related carrying
  amounts may not be recoverable. Asset impairment is considered to exist if the
  total estimated future cash flows, on an undiscounted basis, are less than the
  carrying amount of the long-lived asset. An impairment loss is measured and
  recorded based on discounted estimated future cash flows. Future cash flows
  are based on estimated quantities of recoverable minerals, expected gold and
  other commodity prices (considering current and historical prices, price trends
  and related factors), production levels and cash costs of production, capital
  and reclamation costs, all based on detailed engineering life-of-mine plans.

In estimating future cash flows, assets
  are grouped at the lowest levels for which there are identifiable cash flows
  that are largely independent of future cash flows from other asset groups. With
  the exception of other mine-related exploration potential and exploration potential
  in areas outside of the immediate mine-site, all assets at a particular operation
  are considered together for purposes of estimating future cash flows. In the
  case of mineral interests associated with other mine-related exploration potential
  and exploration potential in areas outside of the immediate mine-site, cash
  flows and fair values are individually evaluated based primarily on recent exploration
  results.

Various factors could impact our ability
  to achieve forecasted production schedules from proven and probable reserves.
  Additionally, commodity prices, capital expenditure requirements and reclamation
  costs could differ from the assumptions used in the cash flow models used to
  assess impairment. The ability to achieve the estimated quantities of recoverable
  minerals from exploration stage mineral interests involves further risks in
  addition to those factors applicable to mineral interests where proven and probable
  reserves have been identified, due to the lower level of confidence that the
  identified mineralized material can ultimately be mined economically. Material
  changes to any of these factors or assumptions discussed above could result
  in future impairment charges to operations.

Fair value of financial instruments
  - Financial accounting standards Statement No. 107, Disclosure About Fair
  Value of Financial Instruments, requires the Company to disclose, when
  reasonably attainable, the fair market values of its assets and liabilities
  which are deemed to be financial instruments. The carrying amounts and estimated
  fair values of the Companys financial instruments approximate their fair
  value due to the short-term nature.

Derivative financial instruments
  - In connection with the sale of debt or equity instruments, the Company may
  sell warrants to purchase common stock. In certain circumstances, these warrants
  may be classified as derivative liabilities, rather than as equity. Additionally,
  debt or equity instruments may contain embedded derivative instruments, such
  as conversion options, which in certain circumstances may be required to be
  bifurcated from the associated host instrument and accounted for separately
  as a derivative liability.

The identification of, and accounting
  for, derivative financial instruments is extremely complex. Derivative financial
  instruments are initially measured at their fair value. The Companys derivative
  liabilities are re-valued at each reporting date, with changes in the estimated
  fair value reported as charges or credits to income, in the period in which
  the changes occur. For warrants and bifurcated conversion options that are accounted
  for as derivative liabilities, the Company determines the fair value of these
  instruments using the binomial option pricing model. That

F-10

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT
        POLICIES(continued)
|-- | ---------------------------------------------------------------------------------------

model requires assumptions related to
  the remaining term of the instruments and risk-free rates of return, the Companys
  current common stock price and expected dividend yield, and the expected volatility
  of its common stock price over the life of the warrant based upon certain historical
  measurements. The identification of, and accounting for, derivative financial
  instruments and the assumptions used to value them can significantly affect
  the Companys financial statements.

The classification of derivative instruments,
  including whether such instruments should be recorded as liabilities or as equity,
  is re-assessed at the end of each reporting period. Derivative instrument liabilities
  are classified in the balance sheet as current or non-current based on whether
  or not settlement of the derivative instrument could be required within 12 months
  of the balance sheet date. The Company does not have any warrants that would
  be classified as derivative liabilities as of the balance sheet date.

Revenue recognition - Revenues
  are recognized during the period in which the revenues are received. Costs and
  expenses are recognized during the period in which they are incurred.

Research and development - All
  research and development expenditures during the period have been charged to
  operations.

Earnings (loss) per share - The
  Company follows SFAS No. 128, Earnings Per Share and SFAS No. 150,
  Accounting for Certain Financial Instruments with Characteristics of Both
  Liabilities and Equity, which establish standards for the computation,
  presentation and disclosure requirements for basic and diluted earnings per
  share for entities with publicly-held common shares and potential common stock
  issuances. Basic earnings (loss) per share are computed by dividing net income
  by the weighted average number of common shares outstanding. In computing diluted
  earnings per share, the weighted average number of shares outstanding is adjusted
  to reflect the effect of potentially dilutive securities, such as stock options
  and warrants. Common stock equivalent shares are excluded from the computation
  if their effect is antidilutive. Common stock equivalents, which include stock
  options and warrants to purchase common stock, on March 31, 2007 and December
  31, 2006 that were not included in the computation of diluted EPS because the
  effect would be antidilutive were 22,996,168 and 27,196,773, respectively.

Income taxes - The Company accounts
  for its income taxes in accordance with Statement of Financial Accounting Standards
  No. 109, which requires recognition of deferred tax assets and liabilities for
  future tax consequences attributable to differences between the financial statement
  carrying amounts of existing assets and liabilities and their respective tax
  bases and tax credit carry-forwards. Deferred tax assets and liabilities are
  measured using enacted tax rates expected to apply to taxable income in the
  years in which those temporary differences are expected to be recovered or settled.
  The effect on deferred tax assets and liabilities of a change in tax rates is
  recognized in income in the period that includes the enactment date.

Comprehensive income (loss) 
  The companys accumulated other comprehensive loss consists of the accumulated
  foreign currency translation adjustments.

F-11

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT
        POLICIES(continued)
|-- | ---------------------------------------------------------------------------------------

Segment information - The Company
  discloses segment information in accordance with Statements of Financial Accounting
  Standards (SFAS) No. 131, Disclosures about Segments of an Enterprise
  and Related Information, which uses the Management approach to determine
  reportable segments. The Company operates under one segment.

Reclassification - Certain reclassifications
  have been made to the prior years financial statements to conform to the
  current years presentation with no effect on previously reported net loss.

Expenses of offering - The Company
  accounts for specific incremental costs directly to a proposed or actual offering
  of securities as a direct charge against the gross proceeds of the offering.

Stock-based compensation - On
  December 16, 2004, the FASB issued SFAS No. 123R, Share-Based Payment,
  which replaces SFAS No. 123, Accounting for Stock-Based Compensation
  and supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees.
  SFAS No. 123R requires all share-based payments to employees, including grants
  of employee stock options, to be recognized in the financial statements based
  on the grant date fair value of the award. SFAS No. 123R was to be effective
  for interim or annual reporting periods beginning on or after June 15, 2005,
  but in April 2005 the SEC issued a rule that will permit most registrants to
  implement SFAS No. 123R at the beginning of their next fiscal year, instead
  of the next reporting period as required by SFAS No. 123R. The pro forma disclosures
  previously permitted under SFAS No. 123 no longer will be an alternative to
  financial statement recognition. Under SFAS No. 123R, the Company must determine
  the appropriate fair value model to be used for valuing share-based payments,
  the amortization method for compensation cost and the transition method to be
  used at date of adoption. The transition methods include prospective and retroactive
  adoption option. Under the retroactive option, prior periods may be restated
  either as of the beginning of the year of adoption or for all periods presented.
  The prospective method requires that compensation expense be recorded for all
  unvested stock options and restricted stock at the beginning of the first quarter
  of adoption of SFAS No. 123R, while the retroactive methods would record compensation
  expense for all unvested stock options and restricted stock beginning with the
  first period restated. The Company has adopted the requirements of SFAS No.
  123R for the fiscal year beginning after December 31, 2004.

New accounting pronouncements
   In February 2007, the FASB issued SFAS No. 159, The Fair Value
  Option for Financial Assets and Financial Liabilities  Including an amendment
  of FASB Statement No. 115 (SFAS 159), which permits entities
  to choose to measure many financial instruments and certain other items at fair
  value that are not currently required to be measured at fair value. The objective
  is to improve financial reporting by providing entities with the opportunity
  to mitigate volatility in reported earnings caused by measuring related assets
  and liabilities differently without having to apply complex hedge accounting
  provisions. SFAS 159 also establishes presentation and disclosure requirements
  designed to facilitate comparisons between entities that choose different measurement
  attributes for similar types of assets and liabilities. SFAS 159 does not affect
  any existing accounting literature that requires certain assets and liabilities
  to be carried at fair value, nor eliminate disclosure requirements included
  in other accounting standards, including requirements for disclosures about
  fair value measurements included in SFAS 157, Fair Value Measurements,
  and SFAS 107, Disclosures about Fair Value of Financial Instruments.
  SFAS 159 is effective for our fiscal year beginning after November 15,

F-12

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT
        POLICIES(continued)
|-- | ---------------------------------------------------------------------------------------

2007. We are currently assessing the
  impact that the adoption of SFAS 159 will have on our financial statements.

In September 2006, the FASB issued Statement
  No. 158 Employers Accounting for Defined Benefit Pension and Other
  Postretirement Plans (SFAS 158). SFAS 158 requires companies to
  recognize the over funded or under funded status of a defined benefit postretirement
  plan as an asset or liability in its statement of financial position and to
  recognize changes in that funded status in the year in which the changes occur
  through comprehensive income. SFAS 158 requires companies to measure the funded
  status of a plan as of the date of its year-end statement of financial position,
  with limited exceptions. The Company adopted SFAS 158 effective for the fiscal
  year ending December 31, 2006. Adoption of this statement had no impact on the
  Companys financial position or results of operations.

In September 2006, the FASB issued statement
  No. 157, Fair Value Measurements (SFAS 157). SFAS 157
  defines fair value, establishes a framework for measuring fair value in accordance
  with accounting principles generally accepted in the United States, and expands
  disclosures about fair value measurements. SFAS 157 is effective for fiscal
  years beginning after November 15, 2007, with earlier application encouraged.
  Any amounts recognized upon adoption as a cumulative effect adjustment will
  be recorded to the opening balance of retained earnings in the year of adoption.
  We have not yet determined the impact of this Statement on its financial position
  and results of operations.

In September 2006, the Securities and
  Exchange Commission issued Staff Accounting Bulletin No. 108 (SAB 108). SAB
  108 considers the effects of prior year misstatements when quantifying misstatements
  in the current year financial statements. It is effective for fiscal years ending
  after November 15, 2006. The Company does not believe the adoption of SAB 108
  will have a material impact on its financial statements.

In August 2006, the SEC published amendments
  to the disclosure requirements for executive and director compensation, related
  party transactions, director independence and other corporate governance matters,
  security ownership of officers and directors. The rules affect disclosure in
  proxy statements, annual reports and registration statements. These amendments
  are effective for filings for fiscal years ending on or after December 15, 2006.
  The effect of these amendments have been incorporated into our financial reporting.

In July 2006, the Financial Accounting
  Standards Board (FASB) issued FASB Interpretation No. 48, Accounting for
  Uncertainty in Income Taxes  an interpretation of FASB Statement No. 109
  (FIN 48), which clarifies the accounting and disclosure for uncertainty
  in tax positions. FIN 48 seeks to reduce the diversity in practice associated
  with certain aspects of the recognition and measurement related to accounting
  for income taxes. This interpretation is effective for fiscal years beginning
  after December 15, 2006. The Company is currently in the process of evaluating
  the financial impact of this statement.

F-13

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT
        POLICIES(continued)
|-- | ---------------------------------------------------------------------------------------

In March 2006, the FASB issued SFAS No.
  156, Accounting for Servicing of Financial Assets: (SFAS 156),
  which requires all separately recognized servicing assets and servicing liabilities
  to be initially measured at fair value. SFAS 156 permits, but does not require,
  the subsequent measurement of servicing assets and servicing liabilities at
  fair value. Adoption is required as of the beginning of the first fiscal year
  that begins after September, 15, 2006. The adoption of SFAS 156 is not expected
  to have a material effect on the Companys financial position, results
  of operations or cash flows.

In February 2006, the FASB issued SFAS
  No. 155, Accounting for Certain Hybrid Financial Instruments, an amendment
  of FASB Statements No. 133 and 140 (SFAS 155). SFAS 155 clarifies
  certain issues relating to embedded derivatives and beneficial interests in
  securitized financial assets. The provisions of SFAS 155 are effective for all
  financial instruments acquired or issued after fiscal years beginning after
  September 15, 2006. Adoption of this statement is expected to have no impact
  on the Companys financial position or results of operations.

|2. | FIXED ASSETS
|-- | ------------

Fixed assets consist of the following
  as of March 31, 2007 and December 31, 2006:

| |                               |   | March
      31, 2007 |  |   | December
      31, 2006 | 
| | ----------------------------- | - | -------------------- |  | - | ----------------------- | 
| |                               |   |                      |  |   |                         | 
| | Furniture and fixtures        | $ | 15,600               |  | $ | 15,600                  | 
| | Lab equipment                 |   | 2,804                |  |   | 2,804                   | 
| | Computers and equipment       |   | 17,788               |  |   | 17,788                  | 
| | Income property               |   | 309,750              |  |   | --                      | 
| | Construction in progress      |   | 5,746                |  |   | --                      | 
| |                               |   |                      |  |   |                         | 
| |                               |   | 351,688              |  |   | 36,192                  | 
| | Less accumulated depreciation |   | 8,794                |  |   | 6,005                   | 
| |                               |   |                      |  |   |                         | 
| |                               | $ | 342,894              |  | $ | 30,187                  | 

F-14

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|3. | MERGER WITH TRANSYLVANIA INTERNATIONAL, INC.
|-- | --------------------------------------------

On February 15, 2007, the Company completed
  a merger with Transylvania International, Inc. (TI) which provided the Company
  with 100% ownership of the Clarkdale Slag Project in Clarkdale Arizona, through
  its wholly owned subsidiary CML. This acquisition superseded the joint venture
  option agreement to acquire a 50% ownership interest as a joint venture partner
  pursuant to Nanominerals Corp. (NMC) interest in a joint venture
  agreement (JV Agreement) dated May 20, 2005 between NMC and Verde
  River Iron Company, LLC (VRIC).

This merger was treated as a statutory
  merger for tax purposes whereby, CML was the surviving merger entity.

The Company also formed a second wholly
  owned subsidiary CMC, for the purpose of developing a processing plant at the
  Clarkdale Slag Project.

Closing of the TI acquisition occurred
  on February 15, 2007 (the Closing Date) and was subject to, among
  other things, the following terms and conditions:

| | a) | The Company paid $200,000 in cash to VRIC on the execution
        of the Letter Agreement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | b) | The Company paid $9,900,000 in cash to VRIC on the Closing
        Date;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | c) | The Company issued 16,825,000 shares of its common stock
        on the Closing Date to the designates of VRIC pursuant to Section 4(2)
        and Regulation D of the Securities Act of 1933;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | d) | The Company agreed to pay VRIC $30,000 per month (the
        Monthly Payments) until the earlier of: (i) the date that
        is 90 days after receipt of a bankable feasibility study by Searchlight
        (the Project Funding Date), or (ii) the tenth anniversary
        of the date of the execution of the Letter Agreement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | e) | The Company agreed to pay VRIC $6,400,000 on the Project
        Funding Date;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | f) | The Company granted VRIC a royalty (the Royalty)
        consisting of 2.5% of the Net Smelter Returns (as defined in the Letter
        Agreement), on any and all proceeds of production from the Clarkdale Slag
        Project; and pay to VRIC $500,000 annually (subject to Force Majeure)
        commencing on the Project Funding Date (the Advance Royalty),
        with no deduction or offset against the Royalty, except that the combined
        Royalty and Advance Royalty shall not exceed $500,000 in any calendar
        year; and, the Advance Royalty shall end forever on the first to occur
        between: (1) the end of the first calendar year in which the Royalty equals
        or exceeds $500,000; or (2) the date that is ten (10) years after the
        date the Agreement is executed by the parties; and
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | g) | The Company agreed to pay VRIC $3,500,000 as a priority
        distribution of cash flow in accordance with the provisions of the Joint
        Venture Agreement dated May 20, 2005 between Nanominerals Corp. and VRIC
        (the JV Agreement).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

F-15

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|3. | MERGER WITH TRANSYLVANIA INTERNATIONAL, INC.
      (continued)
|-- | --------------------------------------------------------------

Total consideration paid was approximately
  $120.3 million for the TI acquisition. The following table reflects the components
  of purchase consideration:

| | Purchase price:                                        |   |             | 
| | ------------------------------------------------------ | - | ----------- | 
| | Cash payments                                          | $ | 10,100,000  | 
| | Common stock issued                                    |   | 66,879,375  | 
| | Monthly payments, current portion                      |   | 395,001     | 
| | Monthly payments, net of current portion               |   | 3,252,403   | 
| | Due to VRIC                                            |   | 6,400,000   | 
| | Acquisition costs                                      |   | 127,000     | 
| | Deferred income tax liability - Clarkdale slag project |   | 33,151,312  | 
| |                                                        |   |             | 
| | Total purchase price                                   | $ | 120,305,091 | 

In accordance with SFAS 141, Business
  Combinations, the purchase price of $120.3 million has been allocated to the
  assets acquired and liabilities assumed, based on their respective fair values
  at the date of acquisition. The purchase price was allocated to the real property
  assets based on fair market values determined using an independent real estate
  appraisal firm. The purchase price allocated to the Clarkdale slag project was
  determined based on the overall consideration given. The following table reflects
  allocation of the purchase consideration.

| | Preliminary allocation of purchase price: |   |             | 
| | ----------------------------------------- | - | ----------- | 
| | Clarkdale slag project                    | $ | 110,779,191 | 
| | Land - slag pile site                     |   | 5,916,150   | 
| | Land                                      |   | 3,300,000   | 
| | Income property and improvements          |   | 309,750     | 
| |                                           |   |             | 
| | Net assets acquired                       | $ | 120,305,091 | 

The Clarkdale slag project valuation
  also includes $690,000 previously capitalized.

For the three months ended March 31,
  2006, TI operations were limited to minor rental activity revenue of approximately
  $10,000 and rental expenses and property holding costs of approximately $8,000
  for net pre tax income of approximately $2,000. Based on the limited activity,
  pro-forma results for the comparative quarter in 2006 are not presented in these
  interim financial statements.

|4. | MINING CLAIMS
|-- | -------------

As of March 31, 2007, mining claims totaling
  $127,134 consist of twenty mining claims located in Searchlight, Nevada. The
  mining claims were acquired during 2005 with issuance of 1,400,000 shares of
  the Companys common stock and the provision that the Company, at its option,
  issue an additional 1,400,000 shares each year in July for three remaining years.
  If at any time before each subsequent issuance of shares, the Company does not
  choose to continue the transaction, it is under no obligation to issue further
  shares and would no longer hold the mining claims.

F-16

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|4. | MINING CLAIMS(continued)
|-- | ------------------------

The mining claims are capitalized as
  tangible assets in accordance with Emerging Issues Task Force abstract 04-02.
  Upon completion of a bankable feasibility study, the claims will be amortized
  using the unit-of-production method over the life of the claim. If the Company
  does not continue with exploration after the completion of the feasibility study,
  the claims will be expensed at that time.

The total transaction was valued at an
  agreed upon price of $2,000 per claim for a total of $40,000 plus actual costs
  incurred by the former owner in maintaining the claims of $87,134.

|5. | LOANS PAYABLE                                                                                                                                                                                                                                                                                                                                                                                                      
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | The balance was, unsecured, due on demand
        and bore no interest rate. As of December 31, 2006, the Company had fully
        paid the balance of loan payable.                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|6. | LOAN PAYABLE  FORMER OFFICERS AND
        DIRECTORS                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | As of March 31, 2007 and December 31, 2006,
        loans payable to related parties totaling $382,792 consists of borrowings
        from former officers and directors of the Company. These individuals have
        not had any involvement in management of the Company since February 2005.
        The balance of the loan is non-interest bearing, unsecured and without
        any fixed repayment terms.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|7. | STOCKHOLDERS EQUITY                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | During the three months ended March 31, 2007,
        the Companys stockholders activities consisted of the following:                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                 

F-17

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|7. | STOCKHOLDERS EQUITY(continued)
|-- | -------------------------------
|   |                                
|   | b)                             
|   |                                
|   | c)                             
|   |                                
|   | d)                             

Warrants associated with the 2007 equity
  issuances do not constitute a registration payment arrangement.

F-18

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|7. | STOCKHOLDERS EQUITY(continued)
|-- | -------------------------------

During 2006, the Companys stockholders activities
  consisted of the following:

|a) | On July 27, 2006, the Company issued 1,400,000 shares
        to the owners of the Searchlight Claims. This issuance is the second of
        four required share payments to complete the acquisition of the searchlight
        claims totaling 5,600,000 shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|b) | On June 21, 2006, the Company issued 8,506,000 shares
        of common stock from the exercise of warrants resulting in cash proceeds
        of $4,874,126. Warrants exercised were for 7,327,000 shares at $0.625
        per share and 1,179,000 shares at $0.25 per share. Each of the warrants
        was set to expire between June 2 and June 7, 2006 and all were exercised.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|c) | On June 14, 2006, the Company issued 50,000 shares at
        $2.06 per share as consideration for an employment contract entered into
        on June 14, 2006 with a new Chief Financial Officer. In addition, the
        Company advanced $33,084 for withholding taxes required to be paid on
        total compensation of $103,000. The advance was repaid in full in December
        31, 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|d) | On February 9, 2006, the Company issued 1,225,000 shares
        of common stock and warrants to purchase an additional 612,500 shares
        of common stock with an exercise price of $0.625 expiring between June
        2 and June 7, 2006. These are related to the penalty shares and warrants
        for the late registration of shares with the Securities and Exchange Commission
        pursuant to the Private Placements completed in September 2005. Pursuant
        to the Private Placements, subscribers received penalty units consisting
        of one share and one half of one share purchase warrant. The penalty units
        were exercisable into 1/10thof the total number of units issued
        in the private placement if a registrations statement on Form SB-2 was
        not declared effective within four months and one day of the closing date
        of the private placements. The Registration Statement was not effective
        prior to the filing deadline resulting in the issuance of the penalty
        units.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|e) | On January 18, 2006, the Company issued 39 units for
        $45,000 per unit where each unit consisted of 100,000 shares and 100,000
        purchase warrants. Each purchase warrant is exercisable into one share
        at a price of $0.65 expiring on January 18, 2008. Total gross proceeds
        for this offering was $1,755,000. In connection with the Private Placement,
        the Agent received a fee of $87,750 and warrants to purchase 390,000 shares
        at a price of $0.65 per share for a period of two years from the closing
        of the Private Placement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

F-19

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|7. | STOCKHOLDERS EQUITY(continued)
|-- | -------------------------------

During 2005, the Companys stockholders
  activities consisted of the following:

| | a) | On September 30, 2005, the Company effectuated a two-for-one
        forward stock split on its common stock. As a result of the stock split,
        the Companys authorized number common stock increased from 200,000,000
        shares to 400,000,000 shares. Accordingly, the accompanying financial
        statements have been adjusted on a retroactive basis for the forward stock
        split to the Companys date of inception.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | b) | On September 7, 2005 the Company issued 5,400,000 Units
        for $0.25 per Unit, where each Unit consisted of one common share and
        one half of one purchase warrant and one nontransferable warrant exercisable
        into one tenth (1/10) of one unit for no additional consideration if registration
        requirements are not met within four months and one day after the closing.
        Each purchase warrant was exercisable into one share at a price of $0.625
        and expired on June 7, 2006. Total gross proceeds of this offering was
        $1,350,000. In connection with this brokered offering, 540,000 Brokers
        Warrants, exercisable at $0.25 and expiring on June 7, 2006, were issued.
        Each Broker Warrant was exercisable into one common share and one half
        of one purchase warrant. Each purchase warrant was exercisable into one
        common share at $0.625 and expired on June 7, 2006.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | c) | On September 6, 2005 the Company issued 460,000 Units
        for $0.25 per Unit, where each Unit consisted of one common share and
        one half of one purchase warrant and one nontransferable warrant exercisable
        into one tenth (1/10) of one unit for no additional consideration if registration
        requirements are not met within four months and one day after the closing.
        Each purchase warrant was exercisable into one share at a price of $0.625
        and expired on June 6, 2006. Total gross proceeds of this offering was
        $115,000.                                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | d) | On September 2, 2005 the Company issued 6,390,000 Units
        for $0.25 per Unit, where each Unit consisted of one common share and
        one half of one purchase warrant and one nontransferable warrant exercisable
        into one tenth (1/10) of one unit for no additional consideration if registration
        requirements are not met Within four months and one day after the closing.
        Each purchase warrant was exercisable into one share at a price of $0.625
        and expired on June 2, 2006. Total gross proceeds of this offering was
        $1,597,500. In connection with this brokered offering, 639,000 Brokers
        Warrants, exercisable at $0.25 and expiring on June 2, 2006, were issued.
        Each Broker Warrant was exercisable into one common share and one half
        of one purchase warrant. Each purchase warrant was exercisable into one
        common share at $0.625 and expired on June 2, 2006.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | e) | On July 7, 2005, the Company issued 1,400,000 shares
        (post stock split) of common stock for the purchase of 20 mineral claims
        valued at $40,000 plus actual costs incurred by the former owner in maintaining
        the claims of $87,134.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | f) | On July 6, 2005, the Company issued 200,000 shares (post
        stock split) of common stock at $0.625 per share for reduction of debt
        at $125,000 as negotiated with the debtor.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | g) | On February 14, 2005, the Company cancelled all of the
        stock options that were outstanding as at December 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | h) | On February 11, 2005, 35,000,000 shares (post stock
        split) of the Company were returned to the Company and cancelled at its
        par value of $0.001 per share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

F-20

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|8. | OPTION PLAN                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | Subsequent to March 31, 2007, effective April 30, 2007,
        the Board of Directors adopted the 2007 Stock Option Plan (the 2007
        Plan) and determined to cease granting any further options under
        the Companys 2006 Stock Option Plan. Under the terms of the 2007
        Plan, options to purchase up to 40,000,000 shares of common stock of the
        Company may be granted to eligible Participants. The 2007 Plan provides
        that the option price for incentive stock options be the fair market value
        of the stock at the date of the grant and the option price for non-qualified
        stock options be no less than 85% of the fair market value of the stock
        at the date of the grant. Options granted under the 2007 Plan become exercisable
        and expire as determined by the Board of Directors. On May 8, 2007, the
        Board of Directors determined to cease granting any further options under
        the Companys 2003 Nonqualified Stock Option Plan and reduced the
        number of shares of the Companys common stock available for issuance
        under the 2007 Plan to a maximum of 4,000,000.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | On April 7, 2006, the Board of Directors of Searchlight
        adopted the 2006 Stock Option Plan (the "Plan"). Under the terms of the
        Plan, options to purchase up to 40,000,000 shares of common stock that
        may be granted to our employees, officers, directors, and eligible consultants
        of Searchlight. The Plan provides that the option price be the fair market
        value of the stock at the date of grant as determined by the Board of
        Directors. Options granted become exercisable and expire as determined
        by the Board of Directors. The maximum aggregate number of shares of our
        common stock that may be optioned and sold under the Plan will be increased
        effective the first day of each of our fiscal quarters, beginning with
        the fiscal quarter commencing July 1, 2006, by an amount equal to the
        lesser of: (i) 15% of the total increase in the number of shares of common
        Stock outstanding during the previous fiscal quarter; or (ii) a lesser
        number of shares of common stock as may be determined by the board of
        Searchlight.                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | During the three months ended March 31, 2007, the Company
        granted stock options as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

| | a) | On February 16, 2007, the Company granted nonqualified
        stock options for the purchase of 75,700 shares of common stock at $4.04
        per share. The options were granted to three officers and employee, are
        fully vested and expire on February 16, 2012.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

During the year ended December 31, 2006,
  the Company granted stock options as follows:

| | a) | On June 14, 2006, the Company granted nonqualified stock
        options for the purchase of 50,000 shares of common stock at $2.06 per
        share. The options were granted as a recruitment incentive to an employee,
        vested 50% on December 14, 2006 and the remaining 50% vest on June 14,
        2007. These options expire on June 14, 2008.           
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                          
| | b) | On June 14, 2006, the Company granted nonqualified stock
        options for the purchase of 100,000 shares of common stock at $2.06 per
        share. The options were granted as a recruitment incentive to the Chief
        Financial Officer, vest 50% on June 14, 2007 and the remaining 50% vest
        on June 14, 2008. These options expire on June 14, 2011.
| |    |                                                                                                                                                                                                                                                                                                                                                                          
| | c) | On June 6, 2006, the Company granted nonqualified stock
        options for the purchase of 100,000 shares of common stock at $2.40 per
        share. The options were granted to equally to two directors, are fully
        vested and expire on June 6, 2011.                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                          
| | d) | On June 6, 2006, the Company granted nonqualified stock
        options for the purchase of 500,000 shares of common stock at $2.40 per
        share. The options were granted to equally to two officer/directors, are
        fully vested and expire on June 6, 2011.                                                                                                

F-21

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|8. | OPTION PLAN(continued)
|-- | ----------------------

| | e) | On April 7, 2006 the Company granted stock options for
        the purchase of 120,000 shares of common stock at $1.70 per share. The
        options were granted equally to two officers, are fully vested and expire
        on April 7, 2011.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Compensation expense for the three months
  ended March 31, 2007 and for the year ended December 31, 2006 related to granting
  of stock options was $129,294 and $186,094, respectively.

Stock options  During the
  three months ended March 31, 2007 and the year ended December 31, 2006, the
  Company granted stock options to employees and directors totaling 75,700 and
  870,000, respectively, with a weighted average strike price of $4.04 and $2.25
  per share, respectively. Certain stock options were exercisable upon grant and
  have a life of 5 years. As of March 31, 2007 stock options outstanding totaled
  3,945,700 with a weighted average strike price of $0.83 per share.

The following table summarizes the Companys
  stock option activity for the three months ended March 31, 2007 and the year
  ended December 31, 2006:

| |                             |  | Number of |  |   | Weighted       | 
| | --------------------------- |  | --------- |  | - | -------------- | 
| |                             |  | Shares    |  |   | Average        | 
| |                             |  |           |  |   | Exercise Price | 
| | Balance December 31, 2005   |  | 3,000,000 |  | $ | 0.35           | 
| | Options granted and assumed |  | 870,000   |  |   | 2.25           | 
| | Options expired             |  | --        |  |   | --             | 
| | Options cancelled           |  | --        |  |   | --             | 
| | Options exercised           |  | --        |  |   | --             | 
| |                             |  |           |  |   |                | 
| | Balance, December 31, 2006  |  | 3,870,000 |  | $ | 0.77           | 
| | Options granted and assumed |  | 75,700    |  |   | 4.04           | 
| | Options expired             |  | --        |  |   | --             | 
| | Options cancelled           |  | --        |  |   | --             | 
| | Options exercised           |  | --        |  |   | --             | 
| |                             |  |           |  |   |                | 
| | Balance, March 31, 2007     |  | 3,945,700 |  | $ | 0.83           | 

The Company estimates the fair value
  of these options granted by using the Binomial Lattice option pricing-model
  with the following assumptions used for grants:

For the three months ended March 31,
  2007 using specific grant dates; no dividend yield; expected volatility of 76.6%;
  risk free interest rate of 4.68%; and expected lives of 5 years for all employee
  and non- employee stock options. Accordingly, the Company valued the services
  under SFAS No. 123R relating to non-statutory stock options upon grant in 2007
  for $129,293 as of March 31, 2007. Based on recent historical stock activity
  the equal probability option pricing model was applied.

In 2006 using specific grant dates; no
  dividend yield; expected volatility of 85%; risk free interest rates of 4.89%
  to 5.08%; and expected lives of 5 years for all employee and non- employee stock
  options. Accordingly, the Company valued the services under SFAS No. 123R relating
  to non-statutory stock options upon grant in 2006 for $186,094 as of December
  31, 2006. Based on stock activity in 2006, the Cox, Ross, Rubenstein option
  pricing model was applied.

F-22

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|8. | OPTION PLAN(continued)
|-- | ----------------------

The following table summarizes information
  about options granted during the three months ended March 31, 2007:

| |                         | Exercise Price    |          |                    |             
| | ----------------------- | ----------------- | -------- | ------------------ | ------------
| |                         | Equals, Exceeds   |          |                    |             
| |                         | Or                | Weighted |                    |             
| | Number of
      Options | Is Less than Mkt. | Average  | Range of           | Weighted    
| | Granted                 | Price of Stock    | Exercise | Exercise           | Average Fair
| | During 2007             | On Grant Date     | Price    | Price              | Value       
| | 75,700                  | Equals            | $ 4.04   | $4.04 to $4.04     | $ 0.41      
| | --                      | Exceeds           | $ --     | $ -- to $ --       | $ --        
| | --                      | Less Than         | $ --     | $ --
      to $ -- | $ --        
| |                         |                   |          |                    |             
| | 75,700                  | Equals            | $ 4.04   | $4.04 to $4.04     | $ 0.41      

The following table summarizes information
  about options granted during the year ended December 31, 2006:

| |                   | Exercise Price          |          |                |             
| | ----------------- | ----------------------- | -------- | -------------- | ------------
| |                   | Equals, Exceeds         |          |                |             
| |                   | Or                      | Weighted |                |             
| | Number of Options | Is Less
      than Mkt. | Average  | Range of       | Weighted    
| | Granted           | Price
      of Stock    | Exercise | Exercise       | Average Fair
| | During 2006       | On Grant Date           | Price    | Price          | Value       
| | --                | Equals                  | $ --     | $ -- to $ --   | $ --        
| | --                | Exceeds                 | $ --     | $ -- to $ --   | $ --        
| | 870,000           | Less than               | $ 2.24   | $1.70 to $2.40 | $ 0.10      
| |                   |                         |          |                |             
| | 870,000           | Less than               | $ 2.24   | $1.70 to $2.40 | $ 0.10      

Stock options/warrants 
  During the three months ended March 31, 2007 the Company granted stock warrants
  related to common stock issued through a private placement totaling 3,660,913
  with a strike price of $4.50 per share and stock warrants totaling 178,345 were
  issued to underwriters of the private placement with a strike price of $4.50
  per share.

The value of the warrants was allocated
  against additional paid in capital as part of the overall offering cost of the
  private placement.

During the three months ended March 31,
  2007 the Company issued stock options for 75,700 shares of common stock to three
  officers and an employee with strike price of $4.04 per share.

Stock options/warrants - During
  the year ended December 31, 2006 the Company granted stock warrants related
  to common stock issued through a private placement totaling 3,900,000 with a
  strike price of $0.65 per share and stock warrants totaling 390,000 were issued
  to underwriters of the private placement with a strike price of $0.65 per share.

The Company also granted warrants related
  to common stock totaling 612,500 which were granted in accordance with registration
  provisions of the September 2005 financing with a strike price of $0.625 per
  share.

The value of the warrants was allocated
  against additional paid in capital as part of the overall offering cost of the
  private placement.

F-23

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|8. | OPTION PLAN(continued)
|-- | ----------------------

During the year ending December 31, 2006
  the Company issued stock options for 870,000 shares of common stock to directors,
  officers and an employee with strike price ranging from $1.70 to $2.40 per share.

The following table summarizes information
  about options/warrants granted during the three months ended March 31, 2007
  and the year ended December 31, 2006:

| |                                      |  | Number of  |   |   | Weighted       |  
| | ------------------------------------ |  | ---------- | - | - | -------------- | -
| |                                      |  | Shares     |   |   | Average        |  
| |                                      |  |            |   |   | Exercise Price |  
| | Balance December 31, 2005            |  | 24,118,500 |   | $ | 0.42           |  
| | Options/warrants granted and assumed |  | 5,772,500  |   |   | 0.55           |  
| | Options/warrants expired             |  | --         |   |   | --             |  
| | Options/warrants cancelled           |  | --         |   |   | --             |  
| | Options/warrants exercised           |  | (9,731,000 | ) |   | (0.50          | )
| |                                      |  |            |   |   |                |  
| | Balance, December 31, 2006           |  | 20,160,000 |   | $ | 0.51           |  
| | Options/warrants granted and assumed |  | 3,914,958  |   | $ | 4.49           |  
| | Options/warrants expired             |  | --         |   |   | --             |  
| | Options/warrants cancelled           |  | --         |   |   | --             |  
| | Options/warrants exercised           |  | --         |   |   | --             |  
| |                                      |  |            |   |   |                |  
| | Balance, March 31, 2007              |  | 24,074,958 |   | $ | 1.16           |  

|9. | PROPERTY RENTAL AGREEMENTS AND LEASES
|-- | -------------------------------------

The Company through its subsidiary CML
  has the following lease and rental agreements as lessor:

Clarkdale Arizona Central Railroad
   Lease

CML has a month-to month rental agreement
  with Clarkdale Arizona Central Railroad. The rental payment is $1,700 per month.

Commercial Building  Lease

CML rents commercial building space
  to two tenants. The rental arrangements for both tenants stem from expired leases
  and are month-to-month. Rent under these agreements totaled $1,260 per month.

Land Lease  Wastewater Effluent

CML entered into a lease on August 25,
  2004 with the Town of Clarkdale, AZ (Clarkdale). The Company provides approximately
  60 acres of land to Clarkdale for disposal of Class B effluent. In return, the
  Company has first right to purchase up to 46,000 gallons per day of the effluent
  for its use at fifty percent (50%) of the potable water rate. In addition, if
  Class A effluent becomes available, the Company may purchase that at seventy
  five percent (75%) of the potable water rate.

F-24

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|9. | PROPERTY RENTAL AGREEMENTS AND LEASES(continued)
|-- | ------------------------------------------------

The term of the lease is 5 years with
  a one year extension available. At such time as Clarkdale no longer uses the
  property for effluent disposal, and for a period of twenty five (25) years measured
  from the date of the lease, the Company has a continuing right to purchase Class
  B, and if available, Class A at then market rates.

|10. | INCOME TAXES
|--- | ------------

The Company is a Nevada corporation operating
  in Nevada and is subject to federal income tax. Nevada does not impose a corporate
  income tax.

The provision for income taxes consisted
  of the following at March 31, 2007 and December 31, 2006

| |                               |   | March
      31, 2007 |   |   | December
      31, 2006 |  
| | ----------------------------- | - | -------------------- | - | - | ----------------------- | -
| |                               |   |                      |   |   |                         |  
| | Income tax benefit at 34%     | $ | (231,210             | ) | $ | (1,241,566              | )
| | Non-deductible and other      |   | 1,335                |   |   | 3,199                   |  
| | Change in valuation allowance |   | 229,875              |   |   | 1,238,367               |  
| |                               |   |                      |   |   |                         |  
| | Provision for income taxes    | $ | --                   |   | $ | --                      |  

Significant components of the Company’s
  net deferred income tax assets at March 31, 2007 and December 31, 2006 were
  as follows:

| |                                  |   | March
      31, 2007 |   |   | December
      31, 2006 |  
| | -------------------------------- | - | -------------------- | - | - | ----------------------- | -
| | Net Operating loss carry forward | $ | 1,805,862            |   | $ | 1,619,947               |  
| | Option compensation              |   | 243,158              |   |   | 199,198                 |  
| | Deferred income tax asset        |   | 2,049,020            |   |   | 1,819,145               |  
| | Valuation allowance              |   | (2,049,020           | ) |   | (1,819,145              | )
| |                                  | $ | --                   |   | $ | --                      |  

A full valuation allowance was established
  for net deferred tax assets due to the uncertainty of realizing these deferred
  tax assets based on conditions existing at March 31, 2007 and December 31, 2006.

Significant components of the Company’s
  net deferred income tax liabilities at March 31, 2007 and December 31, 2006
  were as follows:

| |                               |   | March
      31, 2007 |  |   | December
      31, 2006 | 
| | ----------------------------- | - | -------------------- |  | - | ----------------------- | 
| | Clarkdale slag project        | $ | 33,151,312           |  | $ | --                      | 
| | Deferred income tax liability | $ | 33,151,312           |  | $ | --                      | 

Deferred income tax liability was recorded
  on excess of fair market value acquired over income tax basis at combined statutory
  federal and state rate of 38.5% with the corresponding increase in the purchase
  price allocation of the assets acquired.

F-25

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|10. | INCOME TAXES(continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | As of March 31, 2007 and December 31, 2006, the Company
        had net operating loss carryforwards of approximately $546,810 and $3,456,162,
        respectively for federal income taxes. The net operating loss carryforwards
        expiring between 2027 and 2026.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|11. | COMMITMENTS AND CONTINGENCIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | Lease obligations The Company rents office
        space in Henderson Nevada. The lease terms expired in November, 2006 and
        the company continues to rent the existing space under month- to-month
        terms for $4,000 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | Rental expense, resulting from this operating lease
        agreement, approximated $12,151 for the three months ended March 31, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | Employment contracts Ian R. McNeil. The
        Company entered into an employment agreement with Ian R. McNeil effective
        January 1, 2006. Pursuant to the terms of the agreement, Mr. McNeil is
        to be paid an annual salary of $108,000 and a bonus of $36,000 on execution
        of the agreement, in consideration of which Mr. McNeil agreed to act as
        the Companys President and Chief Executive Officer. Mr. McNeil is
        also eligible for discretionary bonus to be determined based on factors
        considered relevant by the Companys board of directors, and may
        be granted, subject to the approval of the board of directors, incentive
        stock options to purchase shares of the Companys common stock in
        such amounts and at such times as the board of directors, in its absolute
        discretion, may from time to time determine. The term of the agreement
        is for an indefinite period, unless otherwise terminated pursuant to the
        terms of the agreement. In the event that the agreement is terminated
        by the Company other than for cause, the Company will provide Mr. McNeil
        with six months written notice or payment equal to six months of his monthly
        remuneration.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | On February 16, 2007, the Company increased the salary
        of Mr. McNeil under this agreement to $190,000 with no material changes
        to the overall terms of the agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | Carl S. Ager. The Company entered into an employment
        agreement with Carl S. Ager effective January 1, 2006. Pursuant to the
        terms of the agreement, Mr. Ager is to be paid an annual salary of $80,000
        and a bonus of $26,666 on execution of the agreement, in consideration
        of which Mr. Ager agreed to act as the Companys Treasurer and Secretary.
        Mr. Ager is also eligible for discretionary bonus to be determined based
        on factors considered relevant by the Companys board of directors,
        and may be granted, subject to the approval of the board of directors,
        incentive stock options to purchase shares of the Companys common
        stock in such amounts and at such times as the board of directors, in
        its absolute discretion, may from time to time determine. The term of
        the agreement is for an indefinite period, unless otherwise terminated
        pursuant to the terms of the agreement. In the event that the agreement
        is terminated by the Company other than for cause, the Company will provide
        Mr. Ager with six months written notice or payment equal to six months
        of his monthly remuneration.                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | On February 16, 2007, the Company increased the salary
        of Mr. Ager under this agreement to $160,000 with no material changes
        to the overall terms of the agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

F-26

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|11. | COMMITMENTS AND CONTINGENCIES(continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Melvin L. Williams. The Company entered into an employment
        agreement with Melvin L. Williams effective June 14, 2006. Pursuant to
        the terms of the agreement, Mr. Williams is to be paid an annual salary
        of $60,000 based on 300-400 hours worked and bonus consisting of 50,000
        restricted shares of the Companys common stock and 100,000 options
        to purchase additional shares of common stock at a price of $2.06 per
        share exercisable for a period of five years until June 14, 2011, with
        the options vesting 50% on the first anniversary of the execution of the
        agreement, in consideration of which Mr. Williams agreed to act as the
        Companys Chief Financial Officer. Mr. Williams is also eligible
        for discretionary bonus to be determined based on factors considered relevant
        by the Companys board of directors, and may be granted, subject
        to the approval of the board of directors, incentive stock options to
        purchase shares of the Companys common stock in such amounts and
        at such times as the board of directors, in its absolute discretion, may
        from time to time determine. The term of the agreement is for an indefinite
        period, unless otherwise terminated pursuant to the terms of the agreement.
        In the event that the agreement is terminated by the Company other than
        for cause, the Company will provide Mr. Williams with thirty days written
        notice or payment equal to three months of his monthly remuneration.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | On February 16, 2007, the Company increased the salary
        of Mr. Williams under this agreement to $130,000, based on an increase
        in hours worked to 600-800 hours worked and no other material changes
        to the overall terms of the agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | In consideration of the acquisition of the Clarkdale
        Slag Project from VRIC, the Company has agreed to certain additional payments.
        The terms of and conditions of these payments are discussed in more detail
        in Note 3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|12. | CONCENTRATION OF CREDIT RISK                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Financial instruments that potential subject the Company
        to concentration of credit risk consist of cash investments. The Company
        places its temporary cash investments with one financial institution.
        Cash accounts at the financial institution are insured by the Federal
        Deposit Insurance Corporation for up to $100,000 per financial institution.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|13. | CONCENTRATION OF ACTIVITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | For the three months ended March 31, 2007, the Company
        purchased services from two major vendors Dr. Hewlett and NMC that exceeded
        more than 10% of total purchases and amounted to approximately $110,000
        and $90,000, respectively. NMC is considered a related party and is more
        fully discussed the related party note that follows.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14. | RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | During the three months ended March 31, 2007 and 2006,
        the Company utilized the services of NMC to provide technical assistance
        and financing related activities. NMC was reimbursed expenses during 2006.
        Commencing in 2006, NMC invoiced $300,000 for technical assistance and
        financing related activities. These services related primarily to the
        Clarkdale Slag Project and Searchlight Claims project.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | In addition to the above fees, NMC provided dedicated
        use of its laboratory, instrumentation, milling equipment and research
        facilities. NMC provided invoices for these fees plus expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

F-27

---

|SEARCHLIGHT MINERALS CORP.                
|------------------------------------------
|(AN EXPLORATION STAGE ENTERPRISE)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|(UNAUDITED)                               

|14. | RELATED PARTY TRANSACTIONS(continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | For the three months ended March 31, 2007, the Company
        incurred total fees and reimbursement of expenses to NMC of $90,000 and
        $20,775, respectively at March 31, 2007, the Company had an outstanding
        balance due to NMC of $152,638.                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | For the year ended December 31, 2006, the Company incurred
        total fees and reimbursements of expenses to NMC of $495,000 and $271,103,
        respectively at December 31, 2006, the Company had an outstanding balance
        due to NMC of $311,863.                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | In February 2005, the Company entered into mineral options
        agreements to acquired an interest in 20 mineral claims (Searchlight
        Claims) representing an area of 3,200 acres located in Clark County,
        south of Searchlight, Nevada, and agreed to pay a management fee of $3,500
        per month to Pass Minerals, an entity controlled by a shareholder of the
        Company, for management services provided regarding the reorganization
        of the Company and the development of assaying and testing procedures
        for the Searchlight Claims. The management fee agreement was terminated
        by mutual agreement of the board and board member September 2006.

F-28

---

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

FORWARD LOOKING STATEMENTS

The information in this discussion contains forward-looking
statements. These forward-looking statements involve risks and uncertainties,
including statements regarding our capital needs, business strategy and
expectations. 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. These statements reflect the current views of
management with respect to future events and are subject to risks, uncertainties
and other factors that may cause our actual results, performance or
achievements, or industry results, to be materially different from those
described in the forward-looking statements. Such risks and uncertainties
include those set forth under the caption Managements Discussion and Analysis
or Plan of Operation and elsewhere in this Quarterly Report. In evaluating
these statements, you should consider various factors, including the risks
discussed below, and, from time to time, in other reports we file with the
United States Securities and Exchange Commission (the SEC), including our
Annual Reports on Form 10-KSB, our Quarterly Reports on Form 10-QSB and our
Current Reports on Form 8-K.

INTRODUCTION

We are an exploration stage company engaged in the acquisition
and exploration of mineral properties and slag reprocessing projects. Our
business is presently focused on our two mineral projects: (i) the Clarkdale
Slag Project, located in Clarkdale, Arizona, pursuant to which we seek to
recover precious and base metals from the reprocessing of slag material produced
from the smelting of copper ores from former mines in the Jerome, Arizona area;
and (ii) the Searchlight Gold Project, which involves exploration for precious
metals on mining claims near Searchlight, Nevada.

Our current plan of operation on the Clarkdale Slag Project
during the next twelve months is to complete our materials study, continue our
pilot testing and site work in Clarkdale, construct our first unit (module) of
production and, subject to positive results from our pre-feasibility studies and
the results from our one unit module of production, finance and construct a
processing facility. If the results from our pre-feasibility studies and the
production results from the operation of our one unit module are not
sufficiently positive for us to proceed with the construction of our proposed
processing facility we will have to scale back or abandon our proposed
operations on the Clarkdale Slag Project.

Our current plan of operation on the Searchlight Gold Project
is to continue the metallurgical testing program to determine the most favorable
production-scale extraction methods to optimize recovery of precious metals,
drill for reserves (18 holes) and to perform a pre-feasibility study. We have
not earned any revenues to date and do not anticipate earning revenues until
such time as we enter into commercial production of our properties.

RECENT CORPORATE DEVELOPMENTS

We experienced the following significant corporate developments
since the completion of our fiscal year ended December 31, 2006:

|1. | Effective April 30, 2007, our Board of Directors adopted
      our 2007 Stock Option Plan (the "2007 Plan") and determined to cease
      granting any further options under the Companys 2006 Stock Option Plan.
      Under the terms of the 2007 Plan, options to purchase up to 40,000,000
      shares of common stock of the Company may be granted to eligible
      Participants. The 2007 Plan provides that the option price for incentive
      stock options be the fair market value of the stock at the date of the
      grant and the option price for non-qualified stock options be no less than
      85% of the fair market value of the stock at the date of the grant.
      Options granted under the 2007 Plan become exercisable and expire as
      determined by the Board of Directors. The effective date of the 2007 Plan
      is April 30, 2007. On May 8, 2007, the
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3

---

|   | Board of Directors determined to cease granting any
      further options under the Companys 2003 Nonqualified Stock Option Plan
      and reduced the number of shares of the Companys common stock available
      for issuance under the 2007 Plan to a maximum of 4,000,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|2. | On April 30, 2007, our Board of Directors amended and
      restated the Companys bylaws (the Amended Bylaws). The amendment to the
      bylaws was for the purpose of, among other things, removing certain
      outdated and redundant provisions that existed in the Companys prior
      bylaws with respect to corporate governance, shareholder and director
      meeting procedures, and to amend the structure of the Companys board of
      directors to provide for staggered terms to assure continuity and
      stability in the Companys board of directors. The changes to the
      Companys prior bylaws include: (i) expanding certain provisions with
      respect to shareholders meetings including reduction of quorum
      requirements and amendments to actions by majority stockholder consent;
      (ii) amending certain provisions respecting corporate governance and
      committees, and directors meetings; (iii) adopting a classified Board of
      Directors with staggered three year terms; (iv) expanding certain
      provisions with respect to officers and their duties; (v) changing certain
      provisions with respect to share certificates; and (vi) adding certain
      dividend provisions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|3. | On March 22, 2007, we closed a private placement offering
      for gross proceeds of $6,678,483 (the "March Offering"). The securities
      sold pursuant to the March Offering were issued to non-US investors in
      accordance with the terms of Regulation S of the Securities Act of 1933.
      In connection with the March Offering, we entered into an Agency Agreement
      with D&D Securities Company (D&D") dated March 21, 2007 (the
      "Agency Agreement"). The securities were sold to subscribers on a best
      efforts agency basis. Pursuant to the terms of the Agency Agreement, we
      sold an aggregate of 2,226,161 units for gross proceeds of $6,678,483,
      with each unit consisting of one share of our common stock and one half of
      one share purchase warrant with each whole warrant entitling the
      subscriber to purchase one additional share for a period of two years from
      the closing date at an exercise price of $4.50 per share. The warrants are
      callable by Searchlight if its common stock trades above $6.50 per share
      for 20 consecutive trading days. Also under the terms of the March
      Offering we agreed to use our best efforts to file with the SEC a
      registration statement on Form SB-2 registering the offered securities
      within four months and one day after the closing of the March Offering. An
      aggregate commission and corporate finance fee totaling $525,386 was paid
      by us to the Agent in connection with the March Offering and the Agent
      also received warrants to purchase 75,175 shares of our common stock at a
      price of US$4.50 per share, exercisable for a period of two years from the
      closing date.          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|4. | On February 23, 2007, we closed a private placement
      offering and issued 4,520,666 units for aggregate gross proceeds of
      $13,562,002 to accredited investors resident in the United States pursuant
      to Regulation D of the Securities Act (the US Offering). Each unit
      consisted of one share of our common stock and one half of one share
      purchase warrant with each whole warrant entitling the subscriber to
      purchase one additional share for a period of two years from the closing
      date at an exercise price of $4.50 per share. The warrants are callable by
      us if our common stock trades above $6.50 per share for 20 consecutive
      trading days. Pursuant to the terms of the US Offering, we agreed to use
      our best efforts to file with the SEC a registration statement on Form
      SB-2 registering the offered securities within four months and one day
      after the closing of the US Offering. We agreed not to exercise our call
      rights until the registration statement registering the securities
      underlying the units sold has been declared effective by the SEC. We
      further agreed to keep the registration statement effective pursuant to
      Rule 415 of the Securities Act for a period of eighteen months following
      the date the registration statement is declared effective by the SEC. A
      portion of the US Offering was sold on a best efforts agency basis.
      Commissions paid to agents in connection with the US Offering totaled
      $381,990 and the agents also received warrants to purchase 90,870 shares
      of our common stock at a price of $4.50 per share, exercisable for a
      period of two years from the closing date.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|5. | Also on February 23, 2007, we closed a private placement
      offering and issued 575,000 units for aggregate gross proceeds of
      $1,725,000 to non-US investors pursuant to Regulation S of the Securities
      Act (the February Offering). Each unit consisted of one share of our
      common stock and one half of one share purchase warrant with each whole
      warrant entitling the subscriber to purchase one additional share for a
      period of two years from the closing date at an exercise price of $4.50
      per share. The warrants are callable by Searchlight if its common stock
      trades above $6.50 per share for                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

4

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|    | 20 consecutive trading days. Pursuant to the terms of the
      February Offering, we agreed to use our best efforts to file with the SEC
      a registration statement on Form SB-2 registering the offered securities
      within four months and one day after the closing of the February Offering.
      We agreed not to exercise our call rights until the registration statement
      registering the securities underlying the units sold has been declared
      effective by the SEC. We further agreed to keep the registration statement
      effective pursuant to Rule 415 of the Securities Act for a period of
      eighteen months following the date the registration statement is declared
      effective by the SEC. Commissions paid to agents in connection with the
      February Offering totaled $111,100 and the agents also received warrants
      to purchase 12,300 shares of our common stock at a price of $4.50 per
      share, exercisable for a period of two years from the closing
  date.                                                                                                                                                                                                                                                                                                                         
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|6.  | Effective February 16, 2007, we entered into amendments
      to our employment agreements with the following executives: (i) we
      increased the salary of Ian McNeil, President, from $108,000 to $190,000
      per year; (ii) we increased the salary of Carl Ager, Vice President,
      Secretary and Treasurer, from $80,000 to $160,000 per year; and (iii) we
      increased the salary of Melvin Williams, Chief Financial Officer, from
      $60,000 to $130,000 per year based on 600-800 hours of service annually.
      Also on February 16, 2007 in connection with the amendments to the
      executive employment agreements, our board of directors also approved the
      following stock option grants pursuant to our 2006 Stock Option Plan: (i)
      Ian McNeil received 24,800 options; (ii) Carl Ager received 24,800
      options; and (iii) Melvin Williams received 18,600 options. Each option is
      exercisable to acquire a share of our common stock at a price of $4.04
      (the closing price on February 16, 2007), vesting on the grant date and
      expiring five years from the grant date.                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.  | On February 16, 2007, Ian Matheson resigned as a member
      of our board of directors and the board appointed Harry B. Crockett to
      fill the vacancy created by Mr. Mathesons resignation. There was no
      disagreement between Mr. Matheson and Searchlight regarding any matter
      relating to its operations, policies or practices. Harry B. Crockett is
      the managing member of Verde River Iron Company, LLC a private Nevada
      limited liability company which was the prior owner of the slag pile
      underlying the Clarkdale Slag Project. Mr. Crockett serves as a court
      appointed receiver serving various Superior Courts throughout California
      having served in this capacity over the last 15 years. Mr. Crockett has
      previously served as an Executive Vice President of American Savings,
      specializing in troubled debt and troubled assets as well as serving as
      Chairman of the Make A Wish Foundation of San Joaquin County, a charitable
      foundation serving the needs of terminally ill children. Mr. Crockett
      holds a Bachelor of Arts degree from Golden Gate University in San
      Francisco California and a California Real Estate Brokers license. Mr.
      Crockett also has a pilot license with a single and multi engine land and
      instrument ratings.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|8.  | Effective February 16, 2007, we dismissed our independent
      registered public accounting firm, Kyle L. Tingle, CPA, LLC (KLT). The
      decision to change accountants was recommended by our audit committee and
      approved by the board of directors on February 16, 2007. On February 16,
      2007, the board of directors appointed Brown Armstrong, Paulden, McCown,
      Starbuck, Thornburgh & Keeter Accountancy Corporation as our new
      independent registered public accounting firm following the dismissal of
      KLT.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|9.  | On February 15, 2007, we entered into an agreement and
      plan of merger with Clarkdale Minerals LLC, Verde River Iron Company, LLC
      and Transylvania International, Inc. (TI), pursuant to which TI merged
      with and into our wholly owned subsidiary, Clarkdale Minerals LLC, with
      Clarkdale Minerals LLC as the sole surviving corporation. The acquisition
      of TI was completed in accordance with the terms and conditions of the
      Letter Agreement dated November 22, 2006, as amended February 15, 2007
      among Searchlight, Verde River Iron Company, LLC, Harry B. Crockett and
      Gerald Lembas. Pursuant to our acquisition of TI we now own the property
      underlying a slag pile located in Clarkdale, Arizona from which we seek to
      recover base and precious metals through the reprocessing of slag
      material, subject to payment of certain royalties.                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|10. | On January 10, 2007, we incorporated two wholly owned
      subsidiaries: Clarkdale Metals Corp, a Nevada corporation and Clarkdale
      Minerals LLC, a Nevada limited liability corporation. Clarkdale Minerals
      LLC was formed for the purpose of completing the merger with Transylvania
      International,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

5

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| | Inc. pursuant to our Agreement and Plan of Merger with Transylvania International,
      Inc. dated February 15, 2007.
| | ----------------------------------------------------------------------------------------------------------------------

PLAN OF OPERATION

The following discussion and analysis summarizes our plan of
operation for the next twelve months, our results of operations for the three
months ended March 30, 2007 and changes in our financial condition from our year
ended December 31, 2006. The following discussion should be read in conjunction
with the Managements Discussion and Analysis or Plan of Operation included in
our Annual Report on Form 10-KSB for the year ended December 31, 2006.

Clarkdale Slag Project

As of the date of this Quarterly Report, we have drilled 18
holes (SD1-18) in the slag pile under the supervision of Mountain States R&D
International Inc. (MSRDI). These holes were drilled as part of a materials
study being conducted by MSRDI on our behalf. Sample preparation and analysis
was performed under MSRDIs chain of custody sampling.

Our current plan of operation on the Clarkdale Slag Project is
to complete our materials study, continue our pilot testing and site work in
Clarkdale, construct our first unit (module) of production and finance. The
materials study, expected to be completed in the second quarter of 2007, is
expected to show total and processable tonnage as well as the grade study
completed by independent engineers. In the third quarter of 2007, we hope to
complete our pilot testing and site work which will include finalizing the
metallurgy and flow sheet, optimizing the processing protocols and begin
rehabilitating the operations site. We then anticipate our first module of
production, designed to determine the economics of the project and serve as
final feasibility of the project, to be completed in the fourth quarter of 2007.
If the feasibility of the project proves economic, financing and construction of
the processing facility is expected to commence in the first quarter of
2008.

Searchlight Gold Project

In early 2007, we received the initial results of the
metallurgical and analytical analysis on the chain of custody surface samples
and bulk samples (6 tons) samples taken from the project area by Arrakis Inc.
Our current plan of operation on the Searchlight Gold Project is to continue the
metallurgical testing program to determine the most favorable production-scale
extraction methods to optimize recovery of precious metals, drill for reserves
(18 holes) and to perform a pre-feasibility study. The metallurgical testing
program which includes independent metallurgical testing, bulk sampling,
concentration tests, milling and leaching and extraction tests to optimize
recovery of precious metals is expected to be completed in the third quarter of
2007. A drilling and pre-feasibility program, which is expected to include an
18-hole drill program, chain-of-custody sampling and assaying of drill hole
material, pilot plant tests and a pre-feasibility report, is then anticipated to
begin in the fourth quarter of 2007.

The table below provides an overview of the results from
metallurgical tests received from Arrakis during the quarter ended March 31,
2007:

Chain of Custody Results Summary

|COC Tests(1)            | Feed
      Grade  | Extracted Grade   | Leach Method(1)  
|----------------------- | ----------------- | ----------------- | -----------------
|                        | Gold (opt)*(1)(2) | Gold (opt)*(1)(2) |                  
|Bench Leach
      Tests |                   |                   |                  
|SP4  500grams          | 0.58              | 0.24  0.42       | 48 hr
      Leach
|SP4  50lbs head        | 0.54              |                   |                  
|Con 1                   | 1.56              | 0.36              | 96 hr
      leach
|Con 2                   | 0.93              | 0.75              | 96 hr
      leach
|Bulk Leach
      Tests  |                   |                   |                  
|BL1 - 1,000 lbs         | 0.58              | 0.25              | 48 hr
      Leach
|BL2 - 1,000 lbs         | 0.58              | 0.22              | 48 hr
      Leach

6

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COC Tests(1)
    Feed Grade Gold (opt)*(1)(2)
    Extracted Grade Gold (opt)*(1)(2)
    Leach
      Method(1)BL3  9,000 lbs
      head 1,674 lbs cons Autoclave Tests TP2-12  200 grams
      TP8  200 grams TP9 (TP8 tails) Total
    0.90 0.34  0.39 0.37
    0.21 0.03  0.26 0.16
      0.14 0.30
    72 hr Leach 1.5 hr Autoclave 1.5 hr Autoclave
      1.5 hr Autoclave 3.0 hr Autoclave


Notes

|*   | opt (ounces per ton)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Gold analysis was performed by Arrakis, Inc. under
      chain-of-custody parameters. Analysis of all head ore samples was done by
      3 acid digestion in a Milestone Ethos Plus microwave sample digester and
      analyzed by a Perkin Elmer 5100 graphite furnace atomic adsorption (GFAA)
      system with Zeeman background correction. Pregnant solutions from all
      bench and bulk tests were analyzed for Au using calibration blanks and
      standards corrected with matching sample matrix to the specific solution
      being read.
|(2) | Feed Grade is the initial gold content in the
      sample. Extracted Grade is the amount of gold leached into solution.                                                                                                                                                                                                                                                                                                                                                                                                                                   

Results of the chain of custody surface samples are provided
below:

Surface Sample I.D.
    Feed Grade Au
      (opt)*SS5 SS6 SS7 SS8
    0.39 0.48 0.55 0.69


* opt (ounces per ton)

While the feed grade of the preliminary samples indicated
significant gold content, the grade recovered into solution from sample SS8 in a
somewhat standard bottle roll leach test approximated 0.19 opt gold.

Following this initial sampling, Arrakis tested a variety of
bench scale leach methods in order to improve extraction of the gold. The bench
testing and optimization of leach conditions improved the extraction efficiency
to 72% and outlined a protocol for bulk leach testing. To further the work
program, six tons of COC bulk samples were collected from the Searchlight
property on September 14, 2005. Results from analyses of the bulk samples were
as follows:

Bulk Test I.D.
    Feed Grade Au
      (opt)*
    Extracted Grade
      Au (opt)*BL 1 BL 2 BL 3
    0.58 0.58 0.90
    0.25 0.22 0.21


* opt (ounces per ton)

Arrakis has begun work on examining pressure leaching via
autoclave to enhance both the kinetics and extraction efficiency of gold from
solution. A series of 11 autoclave tests were conducted using 200-gram samples
in a Parr 1 liter pressure reactor. Solution analysis was completed by Arrakis,
Inc. The results of such tests are summarized in the following table:

Autoclave Test I.D.*
    Feed Grade Au
      (opt)**
    Extracted Grade
      Au (opt)**TP2 TP3 TP4 TP5 TP6 TP7
    0.37 0.39 0.38 0.37 0.34
      0.37
    0.07 0.08 0.03 0.15 0.19
      0.03


7

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Autoclave Test I.D.*
    Feed Grade Au
      (opt)**
    Extracted Grade
      Au (opt)**TP8 TP9 TP10 TP11 TP12
    0.37 0.37 0.37 0.37 0.37
    0.16 0.14 0.23 0.26 0.15


| | Notes:
| | ------
| | *     
| | **    

The current work plan for the Searchlight Gold Project is to
continue the metallurgical testing program to determine the most favorable
production-scale extraction methods to optimize recovery of precious metals.
Once these results are obtained, we intend to embark on an 18 hole drilling
program and perform a pre-feasibility study.

Cash Requirements

Our estimated expenses for the next twelve months are as
follows:

EXPENSE
    COSTAdministrative
        Expenses
      $2,000,000Legal and
      Accounting Expenses
    $600,000Consulting Services
      $1,000,000Clarkdale Slag
      Project•   Materials Study
    $50,000•   Pilot Testing/Site Work
    $300,000•   First Module of Production
    $7,000,000•   Processing Facility (begin)
    $15,000,000$22,350,000Searchlight Gold
        Project•   Metallurgical Testing Program
      $400,000•   Drilling and Feasibility Program (begin)
      $300,000$700,000TOTAL
    $26,650,000


We recorded a net operating loss of $680,029 for the three
months ended March 31, 2007 and have an accumulated deficit of $10,086,803 since
inception. As at March 31, 2007 we had cash of $13,688,258 and for the next
twelve months, management anticipates that the minimum cash requirements to fund
our proposed exploration program and our continued operations will be
$26,650,000. Accordingly we do not have sufficient funds to meet our planned
expenditures over the next twelve months and will need to obtain further
financing to fund our operations. See Future Financings, below.

8

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RESULTS OF OPERATIONS

Three Months Summary

|                             | Three Months Ended March 31,
|---------------------------- | ----------------------------
|                             |                             
|                             | 2007                        
|Revenue                      | $7,620                      
|Expenses                     | (721,547)                   
|Interest and Dividend Income | 33,898                      
|Net Loss                     | $(680,029)                  

Revenue

During the quarter ended March 31, 2007 we received revenues of
$7,620 of from leases and rentals of our commercial buildings and certain
facilities acquired in connection with our acquisition of Transylvania
International, Inc. (TI) during the quarter. The property leases consist of:
(i) a rental agreement with Clarkdale Arizona Central Railroad for the use of
certain facilities at a rate of $1,700 per month; and (ii) lease of a commercial
building space to two tenants at a rate of $1,260 per month. The lease
arrangements are on a month to month basis with no formal agreements. We are
presently in the exploration stage of our business, have not earned any revenues
from our planned operations to date, and do not anticipate earning revenues
until such time as we enter into commercial production of the Clarkdale Slag
Project, the Searchlight Claims or other mineral properties we may acquire from
time to time.

Expenses

Our expenses for the three months ended March 31, 2007 and
March 31, 2006 are outlined in the table below:

|                                   | Three Months Ended March 31,
|---------------------------------- | ----------------------------
|                                   |                             
|                                   | 2007                        
|Mineral exploration and evaluation | $385,308                    
|General and administrative         | 333,450                     
|Depreciation                       | 2,789                       
|Total Expenses                     | $721,547                    

Operating expenses for the three months ended March 31, 2007
increased by 17.1% as compared to the comparative period in 2006 primarily as a
result of: (i) increased mineral exploration expenses in connection with our
2006 drilling and sampling program on the Clarkdale Slag Project and Searchlight
Claims; and (ii) increased professional and administrative fees associated with
the acquisition of Transylvania International, Inc., the completion of our
equity financings and the preparation of our Registration Statement on Form
SB-2.

9

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Liquidity and Financial Condition

Working Capital

|                          |                         |                            | Percentage           
|------------------------- | ----------------------- | -------------------------- | ---------------------
|                          | At
      March 31, 2007 | At
      December 31, 2006 | Increase / (Decrease)
|Current Assets            | $13,794,507             | $3,790,483                 | 263.9%               
|Current Liabilities       | (8,189,883)             | (1,583,306)                | 417.3%               
|Working Capital (Deficit) | $5,604,624              | $2,207,177                 | 153.9%               

|Cash Flows                                        |                    |                   
|------------------------------------------------- | ------------------ | ------------------
|                                                  | Three Months Ended | Three Months Ended
|                                                  | March 31, 2007     | March 31, 2006    
|Cash Flows used in Operating
      Activities     | $790,673           | $561,413          
|Cash Flows used in Investing Activities           | $9,987,904         | $-                
|Cash Flows provided by
      Financing Activities | $20,782,587        | $1,382,250        
|Net Increase in Cash During Period                | $10,004,010        | $820,837          

Summary of Financing Activities

During the first quarter of 2007, we completed the following
financings to fund our proposed exploration program, our acquisition of
Transylvania International, Inc. and our continued operations:

|- | On March 22, 2007, we closed a private placement offering
      and issued 2,226,161 units for gross proceeds of $6,678,483. The
      securities sold pursuant to the offering were issued to non-US investors
      in accordance with the terms of Regulation S of the Securities Act of
      1933. An aggregate commission and corporate finance fee totalling $525,386
      was paid by us to an agent in connection with the offering and the agent
      also received warrants to purchase 75,175 shares of our common stock.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|- | On February 23, 2007, we closed a private placement
      offering and issued 4,520,666 units for aggregate gross proceeds of
      $13,562,002 to accredited investors resident in the United States pursuant
      to Regulation D of the Securities Act (the US Offering). Commissions
      paid to agents in connection with the US Offering totalled $381,990 and
      the agents also received warrants to purchase 90,870 shares of our common
      stock.                                                                 
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|- | On February 23, 2007, we closed a private placement
      offering and issued 575,000 units for aggregate gross proceeds of
      $1,725,000 to non-US investors pursuant to Regulation S of the Securities
      Act (the February Offering). Commissions paid to agents in connection
      with the February Offering totalled $111,100 and the agents also received
      warrants to purchase 12,300 shares of our common stock.                                                                                                

During the quarter ended March 31, 2007 we raised a total of
$21,965,485 from our equity financings. See Item 2. Unregistered Sales Of
Equity Securities And Use Of Proceeds, below.

Working Capital. The increase in our working capital
surplus from $2,207,177 as at December 31, 2006 as compared to a working capital
surplus of $5,604,624 as at March 31, 2007 was primarily due to the increase in
cash flows from financing activities of $20,782,587 from private placements of
our securities completed during the quarter. See Recent Sales of Unregistered
Securities, below.

Income Tax Liability.Included in long term liabilities
in the accompanying consolidated financials statements is a balance of
$33,151,312 for deferred tax liability relating to the Clarkdale Slag Project.
Deferred income tax liability was recorded on excess of fair market value
acquired over income tax basis at a combined statutory federal and state rate of
38.5% with the corresponding increase in the purchase price allocation of the
assets acquired. As of March 31, 2007 and December 31, 2006, we had net
operating loss carryforwards of approximately $546,810 and

10

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$3,456,162, respectively for federal income taxes. The net
operating loss carryforwards expire between 2027 and 2026.

Equity Compensation.On April 30, 2007, we adopted our
2007 Stock Option Plan (the "2007 Plan"). Under the terms of the 2007 Plan, as
amended May 8, 2007, options to purchase up to 4,000,000 shares of common stock
that may be granted to our employees, officers, directors, and eligible
consultants. As at March 31, 2007 no options have been granted under the 2007
Plan. During the three months ended March 31, 2007 we issued under our 2006
Stock Option Plan options to acquire 75,700 shares of common stock to three of
our executive officers and an employee with an exercise price of $4.04 per
share. The options are fully vested and expire on February 16, 2012.
Compensation expense for the three months ended March 31, 2007 related to
granting of stock options was $129,294.

During the three months ended March 31, 2007 we granted stock
purchase warrants related to common stock issued through a private placement
totaling 3,660,913 with an exercise price of $4.50 per share and stock warrants
totaling 178,345 were issued to underwriters of the private placement with an
exercise price of $4.50 per share.

Future Financings

Our plan of operation calls for significant expenses in
connection with our Clarkdale Slag Project and Searchlight Gold Project. We
recorded a net operating loss of $713,927 for the three months ended March 31,
2007 and have an accumulated deficit of $10,086,803 since inception. As at March
31, 2007 we had cash of $13,688,258 and for the next twelve months, management
anticipates that the minimum cash requirements to fund our proposed exploration
program and our continued operations will be $26,650,000. Accordingly we do not
have sufficient funds to meet our planned expenditures over the next twelve
months and will need to seek additional financing to meet our planned
expenditures.

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

OFF-BALANCE SHEET ARRANGEMENTS

None.

CRITICAL ACCOUNTING POLICIES

We have identified certain accounting policies, described
below, that are the most important to the portrayal of our current financial
condition and results of operations.

Use of Estimates

In preparing the consolidated financial statements in
conformity with accounting principles generally accepted in the United States,
management is required to make estimates and assumptions that affect the
reported amounts of assets and liabilities and the disclosure of contingent
liabilities at the date of the financial statements and revenues and expenses
during the reported period. Actual results could differ from these estimates.

Property and Equipment

Property and equipment are stated at cost less accumulated
depreciation. Depreciation is calculated using the straight-line method over
three to thirty nine years with the exception of leasehold improvements.
Leasehold improvements are depreciated on a straight-line basis over the term of
the lease.

11

---

Principles of Consolidation

The accompanying consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiaries. Significant
intercompany accounts and transactions have been eliminated.

Mineral Property Acquisition and Exploration Costs

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

Exploration Costs  Mineral exploration costs are
expensed as incurred.

Depreciation, Amortization and Capitalization

The Company records depreciation and amortization when
appropriate, using both straight-line and declining balance methods over the
estimated useful life of the assets. Expenditures for maintenance and repairs
are charged to expense as incurred. Additions, major renewals and replacements
that increase the property's useful life are capitalized. Property sold or
retired, together with the related accumulated depreciation, is removed from the
appropriate accounts and the resultant gain or loss is included in net income.

Fixed Assets - Fixed assets are stated at cost less
accumulated depreciation. Depreciation is provided principally on the
straight-line method over the estimated useful lives of the assets, which are
generally 3 to 39 years. The cost of repairs and maintenance is charged to
expense as incurred. Expenditures for property betterments and renewals are
capitalized. Upon sale or other disposition of a depreciable asset, cost and
accumulated depreciation are removed from the accounts and any gain or loss is
reflected in other income (expense). The Company periodically evaluates whether
events and circumstances have occurred that may warrant revision of the
estimated useful life of fixed assets or whether the remaining balance of fixed
assets should be evaluated for possible impairment. The Company uses an estimate
of the related undiscounted cash flows over the remaining life of the fixed
assets in measuring their recoverability.

RISKS AND UNCERTAINTIES

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

We were incorporated in January 12, 1999 and since that time
were engaged in the business of biotechnology research and development. In
February, 2005, we changed our business to mineral exploration. We have a
limited history upon which an evaluation of our future success or failure can be
made. Our net loss since inception is $10,086,803. Our ability to achieve and
maintain profitability and positive cash flow is dependent upon, among other
things:

-        our ability to
locate a profitable mineral property;

-        positive results
from our feasibility studies on the Searchlight Claims and the Clarkdale Slag
Project;

-        positive results
from the operation of our initial test module on the Clarkdale Slag Project; and

-        our ability to
generate revenues.

Our plan of operation calls for significant expenses in
connection with the exploration of the Searchlight Claims and drilling and
sampling activities on the Clarkdale Slag Project which will require us to
obtain additional financing. We recorded a net loss of $680,029 for the three
months ended March 31, 2007 and have an accumulated deficit of $10,086,803 as at
March 31, 2007. As at March 31, 2007 we had cash of

12

---

$13,688,258 and for the next twelve months, management
anticipates that the minimum cash requirements to fund our proposed exploration
program and our continued operations will be $26,650,000. Accordingly we do not
have sufficient funds to meet our planned expenditures over the next twelve
months and will need to obtain further financing to fund our operations.

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

Because our management does not have formal training
specific to the technicalities of mineral exploration, there is a higher risk
our business will fail.

Our executive officers and directors do not have any formal
training as geologists or in the technical aspects of management of a mineral
exploration company. With no direct training or experience in these areas, our
management may not be fully aware of the specific requirements related to
working within this industry. Our management's decisions and choices may not
take into account standard engineering or managerial approaches mineral
exploration companies commonly use. Consequently, our operations, earnings, and
ultimate financial success could suffer irreparable harm due to management's
lack of experience in this industry.

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

Investors should be aware of the difficulties normally
encountered by new mineral exploration companies and the high rate of failure of
such enterprises. The likelihood of success must be considered in light of the
problems, expenses, difficulties, complications and delays encountered in
connection with the exploration of the mineral properties that we plan to
undertake. These potential problems include, but are not limited to,
unanticipated problems relating to exploration, and additional costs and
expenses that may exceed current estimates. The expenditures to be made by us in
the exploration of the mineral claim may not result in the discovery of mineral
deposits. If funding is not available, we may be forced to abandon our
operations.

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

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

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

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

| | (a) | Sales or leasing of base and precious metals by
      governments and central banks;           
| | --- | -----------------------------------------------------------------------------------------------
| |     |                                                                                                
| | (b) | A low rate of inflation and a strong US dollar;                                                
| |     |                                                                                                
| | (c) | Speculative trading;                                                                           
| |     |                                                                                                
| | (d) | Decreased demand for base and precious metals in
      industrial, jewelry and investment uses;

13

---

| | (e) | High supply of base and precious metals from production,
      disinvestment, scrap and hedging;                                                                                                                          
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                           
| | (f) | Sales by base and precious metals producers and foreign
      transactions and other hedging transactions; and                                                                                                            
| |     |                                                                                                                                                                                                                           
| | (g) | Devaluing local currencies (relative to base and precious
      metals price in US dollars) leading to lower production costs and higher
      production in certain major base and precious metals producing
    regions.

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

Because of the inherent dangers involved in mineral
exploration, there is a risk that we may incur liability or damages as we
conduct our business.

The search for valuable minerals involves numerous hazards. As
a result, we may become subject to liability for such hazards, including
pollution and other hazards against which we cannot insure or against which we
may elect not to insure. At the present time we have no coverage to insure
against these hazards. The payment of such liabilities may have a material
adverse effect on our financial position.

If we are unable to achieve economic re-processing of
minerals from our Clarkdale Slag Project, then our financial condition and our
revenues will be adversely affected.

We are currently undertaking drilling and sampling activities
on the Clarkdale Slag Project site in order to assess whether the slag possesses
mineralized material capable of commercial extraction. Once the results from the
drill program are fully analyzed, we intend to undertake the next steps on the
project. These next steps may include more drilling, analytical work, and
testing of material on a larger scale (such as a test plant) and building a
production facility. Until such time as we have established economic feasibility
of the Clarkdale Slag Project through our pre-feasibility studies and the
operation of our one unit module of production from the slag pile, there is no
assurance that we will proceed to the construction of a proposed processing
facility. If the results from our pre-feasibility studies and the production
results from the operation of our one unit module are not sufficiently positive
for us to proceed with the construction of our proposed processing facility we
will have to scale back or abandon our proposed operations on the Clarkdale Slag
Project. At such time that we deem appropriate, a bankable feasibility study
will be undertaken. There is no assurance that actual recoveries of base and
precious metals or other minerals re-processed from the slag pile will be
economically feasible. If metal recoveries are less than projected, then our
metal sales will be less than anticipated and may not equal or exceed the cost
of mining and recovery in which case our operating results and financial
conditions will be adversely affected.

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

There are several governmental regulations that materially
restrict mineral exploration. We are subject to the laws of the State of Nevada
and applicable federal laws as we carry out our exploration program on the
Searchlight Claims. We are required to obtain work permits, post bonds and
perform remediation work for any physical disturbance to the land in order to
comply with these laws. While our planned exploration program budgets for
regulatory compliance, there is a risk that new regulations could increase our
costs of doing business and prevent us from carrying out our exploration
program.

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

Our exploration operations are regulated by both US Federal and
Nevada and Arizona state environmental laws that relate to the protection of air
and water quality, hazardous waste management and mine reclamation. These
regulations will impose operating costs on us. If the regulatory environment for
our

14

---

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.

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

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

|- | Costs of bringing the property into production including
      exploration work, preparation of production feasibility studies, and
      construction of production facilities;
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|- | Availability and costs of financing;                                                                                                                                            
|- | Ongoing costs of production; and                                                                                                                                                
|- | Environmental compliance regulations and restraints.                                                                                                                            

The marketability of any minerals acquired or discovered may be
affected by numerous factors which are beyond our control and which cannot be
accurately predicted, such as market fluctuations, the lack of milling
facilities and processing equipment near the Searchlight Claims, the success of
our drilling and sampling activities on the Clarkdale Slag Project and such
other factors as government regulations, including regulations relating to
allowable production, exporting of minerals, and environmental protection. If we
do not find a mineral reserve or if we cannot explore the mineral reserve,
either because we do not have the money to do it or because it will not be
economically feasible to do it, we will have to cease operations.

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

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

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

There is a risk that new regulations could increase our costs
of doing business and prevent us from carrying out our exploration program. We
will also have to sustain the cost of reclamation and environmental remediation
for all exploration work undertaken. Both reclamation and environmental
remediation refer to putting disturbed ground back as close to its original
state as possible. Other potential pollution or damage must be cleaned-up and
renewed along standard guidelines outlined in the usual permits. Reclamation is
the process of bringing the land back to its natural state after completion of
exploration activities. Environmental remediation refers to the physical
activity of taking steps to remediate, or remedy, any environmental damage

15

---

caused. The amount of these costs is not known at this time as
we do not know the extent of the exploration program that will be undertaken
beyond completion of the recommended work program. If remediation costs exceed
our cash reserves we may be unable to complete our exploration program and have
to abandon our operations.

We may conduct further offerings in the future in which case
investors shareholdings will be diluted.

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

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

Our common stock is considered to be a penny stock since it
does not qualify for one of the exemptions from the definition of penny stock
under Section 3a51-1 of the Securities Exchange Act of 1934 (the Exchange
Act). Our common stock is a penny stock because it meets one or more of the
following conditions (i) the stock trades at a price less than $5.00 per share;
(ii) it is not traded on a recognized national exchange; (iii) it is not
quoted on the Nasdaq Stock Market, or even if so, has a price less than $5.00
per share; or (iv) is issued by a company that has been in business less than
three years with net tangible assets less than $5 million.

The principal result or effect of being designated a penny
  stock is that securities broker-dealers participating in sales of our
  common stock will be subject to the penny stock regulations set
  forth in Rules 15-2 through 15g-9 promulgated under the Exchange Act. For example,
  Rule 15g-2 requires broker-dealers dealing in penny stocks to provide potential
  investors with a document disclosing the risks of penny stocks and to obtain
  a manually signed and dated written receipt of the document at least two business
  days before effecting any transaction in a penny stock for the investor's account.
  Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the
  account of any investor for transactions in such stocks before selling any penny
  stock to that investor. This procedure requires the broker-dealer to (i) obtain
  from the investor information concerning his or her financial situation, investment
  experience and investment objectives; (ii) reasonably determine, based on that
  information, that transactions in penny stocks are suitable for the investor
  and that the investor has sufficient knowledge and experience as to be reasonably
  capable of evaluating the risks of penny stock transactions; (iii) provide the
  investor with a written statement setting forth the basis on which the broker-dealer
  made the determination in (ii) above; and (iv) receive a signed and dated copy
  of such statement from the investor, confirming that it accurately reflects
  the investor's financial situation, investment experience and investment objectives.
  Compliance with these requirements may make it more difficult and time consuming
  for holders of our common stock to resell their shares to third parties or to
  otherwise dispose of them in the market or otherwise.

ITEM
3.           CONTROLS AND
PROCEDURES.

Under the supervision and with the participation of our
management, including the Chief Executive Officer and Chief Financial Officer,
we have evaluated the effectiveness of our disclosure controls and procedures as
required by Exchange Act Rule 13a-15(b) as of the end of the period covered by
this report. Based on that evaluation, the Chief Executive Officer and Chief
Financial Officer have concluded that these disclosure controls and procedures
are effective.

There were no changes in our internal control over financial
reporting during the three months ended March 31, 2007 that have materially
affected, or are reasonably likely to materially affect, our internal control
over financial reporting.

16

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PART II - OTHER INFORMATION

ITEM
1.          LEGAL PROCEEDINGS.

None.

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

During the three months ended March 31, 2007, we completed the
following unregistered sales of our securities:

|1. | On March 22, 2007, we closed a private placement offering
      of 2,226,161 units for gross proceeds of $6,678,483 (the "March
      Offering"). The securities sold pursuant to the March Offering were issued
      to non-US investors in accordance with the terms of Regulation S of the
      Securities Act of 1933. In connection with the March Offering, we entered
      into an Agency Agreement with D&D Securities Company (D&D") dated
      March 21, 2007 (the "Agency Agreement"). The securities were sold to
      subscribers on a best efforts agency basis. Pursuant to the terms of the
      Agency Agreement, each unit consisted of one share of our common stock and
      one half of one share purchase warrant with each whole warrant entitling
      the subscriber to purchase one additional share for a period of two years
      from the closing date at an exercise price of US$4.50 per Share. The
      warrants are callable by Searchlight if its common stock trades above
      $6.50 per share for 20 consecutive trading days. Also under the terms of
      the March Offering we agreed to use our best efforts to file with the SEC
      a registration statement on Form SB-2, or on such other form as is
      available, registering the offered securities within four months and one
      day after the closing of the March Offering. An aggregate commission and
      corporate finance fee totaling $525,386 was paid by us to the Agent in
      connection with the March Offering and the Agent also received warrants to
      purchase 75,175 shares of our common stock.                                                                                                    
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2. | On February 23, 2007, we closed a private placement
      offering and issued 4,520,666 units for aggregate gross proceeds of
      $13,562,002 to accredited investors resident in the United States pursuant
      to Regulation D of the Securities Act (the US Offering). Each unit
      consisted of one share of our common stock and one half of one share
      purchase warrant with each whole warrant entitling the subscriber to
      purchase one additional share for a period of two years from the closing
      date at an exercise price of $4.50 per share. The warrants are callable by
      us if our common stock trades above $6.50 per share for 20 consecutive
      trading days. Pursuant to the terms of the US Offering, we agreed to use
      our best efforts to file a registration statement on Form SB-2 declared
      effective by the SEC within four months of the closing date of the US
      Offering. We agreed not to exercise our call rights until the registration
      statement registering the securities underlying the units sold has been
      declared effective by the SEC. We further agreed to keep the registration
      statement effective pursuant to Rule 415 of the Securities Act for a
      period of eighteen months following the date the registration statement is
      declared effective by the SEC. A portion of the US Offering was sold on a
      best efforts agency basis. Commissions paid to agents in connection with
      the US Offering totaled $381,990 and the agents also received warrants to
      purchase 90,870 shares of our common stock at a price of $4.50 per share,
      exercisable for a period of two years from the closing date.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|3. | Also on February 23, 2007, we closed a private placement
      offering and issued 575,000 units for aggregate gross proceeds of
      $1,725,000 to non-US investors pursuant to Regulation S of the Securities
      Act (the February Offering). Each unit consisted of one share of our
      common stock and one half of one share purchase warrant with each whole
      warrant entitling the subscriber to purchase one additional share for a
      period of two years from the closing date at an exercise price of $4.50
      per share. The warrants are callable by us if our common stock trades
      above $6.50 per share for 20 consecutive trading days. Pursuant to the
      terms of the February Offering, we agreed to use our best efforts to file
      a registration statement on Form SB-2 declared effective by the SEC within
      four months of the closing date of the February Offering. We agreed not to
      exercise our call rights until the registration statement registering the
      securities underlying the units sold has been declared effective by the
      SEC. We further agreed to keep the registration statement effective
      pursuant to Rule 415 of the Securities Act for a period of eighteen months
      following the date the registration statement is declared effective by the
      SEC. Commissions paid to agents in connection with the February
      Offering                                                                                                                                                                                                                                                                                                 

17

---

|   | totaled $111,100 and the agents also received warrants to
      purchase 12,300 shares of our common stock at a price of $4.50 per share,
      exercisable for a period of two years from the closing date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4. | On February 15, 2007, we approved the issuance of
      16,825,000 shares of our common stock to five investors in connection with
      the Agreement and Plan of Merger dated February 15, 2007. The issuance was
      completed pursuant to Section 4(2) and Regulation D of the Securities Act
      on the basis that each investor was a sophisticated investor and was in a
      position of access to relevant material information regarding our
      operations. Each investor delivered appropriate investment representations
      satisfactory to us with respect to this transaction and consented to the
      imposition of restrictive legends upon the certificates evidencing such
      share certificates.

ITEM
3.          DEFAULTS UPON
SENIOR SECURITIES.

None.

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

None.

ITEM
5.          OTHER INFORMATION.

None.

ITEM
6.          EXHIBITS.

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

|Exhibit |                                                                                                                                                                                           
|------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibits                                                                                                                                                                   
|        |                                                                                                                                                                                           
|3.1     | Articles of
      Incorporation of L.C.M. Equity, Inc.(1)                                                                                                                                 
|        |                                                                                                                                                                                           
|3.2     | Amended and
      Restated Bylaws.(30)                                                                                                                                                    
|        |                                                                                                                                                                                           
|3.3     | Certificate of
      Amendment to Articles of Incorporation.(2)                                                                                                                           
|        |                                                                                                                                                                                           
|3.4     | Certificate of
      Amendment to Articles of Incorporation.(3)                                                                                                                           
|        |                                                                                                                                                                                           
|3.5     | Certificate of
      Amendment to Articles of Incorporation.(12)                                                                                                                          
|        |                                                                                                                                                                                           
|3.6     | Certificate of
      Change to Authorized Capital.(13)                                                                                                                                    
|        |                                                                                                                                                                                           
|4.1     | Specimen Stock
      Certificate.(1)                                                                                                                                                      
|        |                                                                                                                                                                                           
|4.2     | Form of US
      Warrant Certificate dated February 23, 2007.(26)                                                                                                                         
|        |                                                                                                                                                                                           
|4.3     | Form of US
      Brokers Warrant Certificate dated February 23, 2007.(26)                                                                                                                
|        |                                                                                                                                                                                           
|4.4     | Form of Non-US
      Warrant Certificate dated February 23, 2007.(26)                                                                                                                     
|        |                                                                                                                                                                                           
|4.5     | Form of Non-US
      Brokers Warrant Certificate dated February 23, 2007.(26)                                                                                                            
|        |                                                                                                                                                                                           
|4.6     | Form of Warrant
      Certificate dated March 21, 2007.(27)                                                                                                                               
|        |                                                                                                                                                                                           
|4.7     | Form of Brokers
      Warrant Certificate dated March 21, 2007.(27)                                                                                                                      
|        |                                                                                                                                                                                           
|10.1    | 2002 Nonqualified
      Stock Option Plan.(4)                                                                                                                                             
|        |                                                                                                                                                                                           
|10.2    | 2003 Nonqualified
      Stock Option Plan.(5)                                                                                                                                             
|        |                                                                                                                                                                                           
|10.3    | Letter Agreement between Phage Genomics, Inc.,
      Searchlight Minerals Inc., Kiminco Inc., Pass Minerals Inc., Debra L.
      Matheson, and Pilot Plant Inc. dated February 8, 2005.(8)

18

---

|Exhibit |                                                                                                                                                                                                                                            
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibits                                                                                                                                                                                                                    
|        |                                                                                                                                                                                                                                            
|10.4    | Letter Agreement between Phage Genomics Inc., Searchlight
      Minerals, Inc., K. Ian Matheson, and Pilot Plant Inc. dated February 8,
      2005.(8)                                                                                     
|        |                                                                                                                                                                                                                                            
|10.5    | Letter Agreement between Phage Genomics, Inc.,
      Searchlight Minerals, Inc., K. Ian Matheson, and Bear Dog Mines Inc. dated
      February 8, 2005.(8)                                                                                 
|        |                                                                                                                                                                                                                                            
|10.6    | Letter Agreement between Phage Genomics, Inc.,
      Searchlight Minerals, Inc., K. Ian Matheson, and Gold Hunter Inc. dated
      February 8, 2005.(8)                                                                                    
|        |                                                                                                                                                                                                                                            
|10.7    | Letter Agreement between Phage Genomics, Inc.,
      Searchlight Minerals, Inc., Kiminco Inc., Pass Minerals Inc., Michael D.
      Anderson, Farrell Drozd, Michael I. Matheson, and Pass Minerals Inc. dated
      February 8, 2005.(8)  
|        |                                                                                                                                                                                                                                            
|10.8    | Letter Agreement between Phage Genomics, Inc.,
      Searchlight Minerals, Inc., K. Ian Matheson, and Britti Gold Inc. dated
      February 8, 2005.(8)                                                                                    
|        |                                                                                                                                                                                                                                            
|10.9    | Letter Agreement between Phage Genomics, Inc.,
      Searchlight Minerals, Inc., Kiminco Inc., Pass Minerals Inc., Michael D.
      Anderson, Geosearch Inc., Patrick I. Matheson, and Geotech Mining Inc.
      dated February 8, 2005.(8)
|        |                                                                                                                                                                                                                                            
|10.10   | Letter Agreement between Phage Genomics, Inc.,
      Searchlight Minerals, Inc., Kiminco Inc., Pass Minerals Inc., and Gold
      Crown Inc. dated February 8, 2005.(8)                                                                    
|        |                                                                                                                                                                                                                                            
|10.11   | Engagement Letter dated June 17, 2005 between Searchlight
      Minerals Corp. and Clarion Finanz AG.(10)                                                                                                                                  
|        |                                                                                                                                                                                                                                            
|10.12   | Extension Agreement dated effective June 22, 2005 among
      Searchlight Minerals Corp., K. Ian Matheson, Searchlight Minerals, Inc.
      and Pilot Plant Inc.(10)                                                                       
|        |                                                                                                                                                                                                                                            
|10.13   | Extension Agreement dated effective June 22, 2005 among
      Searchlight Minerals Corp., K. Ian Matheson, Searchlight Minerals, Inc.
      and Bear Dog Mines Inc.(10)                                                                    
|        |                                                                                                                                                                                                                                            
|10.14   | Extension Agreement dated effective June 22, 2005 among
      Searchlight Minerals Corp., K. Ian Matheson, Searchlight Minerals, Inc.
      and Gold Hunter Inc.(10)                                                                       
|        |                                                                                                                                                                                                                                            
|10.15   | Extension Agreement dated effective June 22, 2005 among
      Searchlight Minerals Corp.,, K. Ian Matheson, Searchlight Minerals, Inc.,
      Pass Minerals Inc., Michael D. Anderson, Farrell Drozd and Michael I.
      Matheson.(10)    
|        |                                                                                                                                                                                                                                            
|10.16   | Extension Agreement dated effective June 22, 2005 among
      Searchlight Minerals Corp., K. Ian Matheson, Searchlight Minerals, Inc.
      and Britti Gold Inc.(10)                                                                       
|        |                                                                                                                                                                                                                                            
|10.17   | Extension Agreement dated effective June 22, 2005 among
      Searchlight Minerals Corp., K. Ian Matheson, Searchlight Minerals, Inc.,
      Geotech Mining Inc., Michael D. Anderson, Geosearch Inc. and Patrick B.
      Matheson.(10)   
|        |                                                                                                                                                                                                                                            
|10.18   | Extension Agreement dated effective June 22, 2005 among
      Searchlight Minerals Corp., K. Ian Matheson, Searchlight Minerals, Inc.
      and Gold Crown Minerals Inc.(10)                                                               
|        |                                                                                                                                                                                                                                            
|10.19   | Assignment Agreement dated for reference June 1, 2005
      between Searchlight Minerals Corp. and Nanominerals Corp.(11)                                                                                                                  
|        |                                                                                                                                                                                                                                            
|10.20   | First Amendment to Assignment Agreement between
      Nanominerals Corp. and Searchlight Minerals Corp. dated August 31,
      2005.(15)                                                                                                   
|        |                                                                                                                                                                                                                                            
|10.21   | Second Amendment to Assignment Agreement between
      Nanominerals Corp. and Searchlight Minerals Corp. dated October 24,
      2005.(14)                                                                                                 
|        |                                                                                                                                                                                                                                            
|10.22   | Office Suite Lease Agreement between Burnett &
      Williams Executive Suites and Searchlight Minerals Corp. dated September
      6, 2005.(15)                                                                                           
|        |                                                                                                                                                                                                                                            
|10.23   | Finders Fee Agreement between Searchlight Minerals Corp.
      and S&P Investors, Inc. dated December 7, 2005.(16)                                                                                                                        
|        |                                                                                                                                                                                                                                            
|10.24   | Employment Agreement between Searchlight Minerals Corp.
      and Carl S. Ager dated as of January 1, 2006.(17)                                                                                                                            

19

---

|Exhibit |                                                                                                                                                                                                                                                   
|------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibits                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                   
|10.25   | Employment Agreement between Searchlight Minerals Corp.
      and Ian R. McNeil dated as of January 1, 2006.(17)                                                                                                                                  
|        |                                                                                                                                                                                                                                                   
|10.26   | Employment Agreement between Searchlight Minerals Corp.
      and Melvin L. Williams dated as of June 14, 2006.(18)                                                                                                                               
|        |                                                                                                                                                                                                                                                   
|10.27   | 2006 Stock Option Plan.(19)                                                                                                                                                                                                                       
|        |                                                                                                                                                                                                                                                   
|10.28   | Engineering Services Agreement dated as of May 1, 2006
      with Cimetta Engineering and Construction Co.(20)                                                                                                                                    
|        |                                                                                                                                                                                                                                                   
|10.29   | Office Suite Lease Agreement between Burnett &
      Williams Executive Suites and Searchlight Minerals Corp. dated July 20,
      2006.(9)                                                                                                       
|        |                                                                                                                                                                                                                                                   
|10.30   | Contract for Engineering Services between URS Corporation
      and Verde River Iron Company LLC dated March 21, 2005.(9)                                                                                                                         
|        |                                                                                                                                                                                                                                                   
|10.31   | Contract for Drilling Services dated May 23, 2006 between
      Boart Longyear Company and Searchlight Minerals Corp. and Contact for
      Services dated October 17, 2005 between Boart Longyear Company and
      Searchlight Minerals Corp.(9)
|        |                                                                                                                                                                                                                                                   
|10.32   | Letter Agreement dated November 22, 2006 among Verde
      River Iron Company, LLC, Harry B. Crockett, Gerald Lembas and Searchlight
      Minerals Corp. (22)                                                                                    
|        |                                                                                                                                                                                                                                                   
|10.33   | Notice of Exercise Option.(23)                                                                                                                                                                                                                    
|        |                                                                                                                                                                                                                                                   
|10.34   | Amendment No. 1 to Letter Agreement dated February 15,
      2007.(24)                                                                                                                                                                            
|        |                                                                                                                                                                                                                                                   
|10.35   | Agreement and Plan of Merger dated February 15, 2007
      between Verde River Iron Company, LLC, Transylvania International, Inc.,
      Clarkdale Minerals LLC and Searchlight Minerals Corp.(24)                                               
|        |                                                                                                                                                                                                                                                   
|10.36   | Special Warranty Deed dated February 15,
      2007.(24)                                                                                                                                                                                          
|        |                                                                                                                                                                                                                                                   
|10.37   | Bill of Sale dated February 15, 2007.(24)                                                                                                                                                                                                         
|        |                                                                                                                                                                                                                                                   
|10.38   | Agreement between Transylvania International, Inc. and
      Reynold P. Radoccia, Architect dated November 14, 2005.(24)                                                                                                                          
|        |                                                                                                                                                                                                                                                   
|10.39   | Effluent lease dated August 25, 2004 between Town of
      Clarkdale, Transylvania International, Inc. and Verde River Iron Company,
      LLC.(24)                                                                                               
|        |                                                                                                                                                                                                                                                   
|10.40   | Articles of Merger between Transylvania International,
      Inc. and Clarkdale Minerals LLC dated February 15, 2007.(24)                                                                                                                         
|        |                                                                                                                                                                                                                                                   
|10.41   | First Amendment to Employment Agreement dated February
      16, 2007 between Searchlight Minerals Corp. and Ian McNeil.(25)                                                                                                                      
|        |                                                                                                                                                                                                                                                   
|10.42   | First Amendment to Employment Agreement dated February
      16, 2007 between Searchlight Minerals Corp. and Carl Ager.(25)                                                                                                                       
|        |                                                                                                                                                                                                                                                   
|10.43   | First Amendment to Employment Agreement dated February
      16, 2007 between Searchlight Minerals Corp. and Melvin
      Williams.(25)                                                                                                           
|        |                                                                                                                                                                                                                                                   
|10.44   | Non-Exclusive Agency Agreement dated February 9, 2007
      between Empire Financial Group, Inc. and Searchlight Minerals
      Corp.(26)                                                                                                         
|        |                                                                                                                                                                                                                                                   
|10.45   | Agency Agreement dated January 30, 2007 between S&P
      Investors, Inc. and Searchlight Minerals Corp.(26)                                                                                                                                      
|        |                                                                                                                                                                                                                                                   
|10.46   | Agency Agreement dated January 31, 2007 between Zuri
      Invest Limited and Searchlight Minerals Corp.(26)                                                                                                                                      
|        |                                                                                                                                                                                                                                                   
|10.47   | Agency Agreement dated March 21, 2007 between D&D
      Securities Company and Searchlight Minerals Corp.(27)                                                                                                                                     
|        |                                                                                                                                                                                                                                                   
|10.48   | 2007 Stock Option Plan.(31)                                                                                                                                                                                                                       
|        |                                                                                                                                                                                                                                                   
|14.1    | Code of Ethics.(21)                                                                                                                                                                                                                               

20

---

|Exhibit |                                                                                                                                                                                                                               
|------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibits                                                                                                                                                                                                       
|        |                                                                                                                                                                                                                               
|21.1    | List of Subsidiaries.(28)                                                                                                                                                                                                     
|        |                                                                                                                                                                                                                               
|31.1    | Certification
        of Chief Executive Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley
        Act of 2002.                                                                                                
|        |                                                                                                                                                                                                                               
|31.2    | Certification
        of Chief Financial Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley
        Act of 2002.                                                                                                
|        |                                                                                                                                                                                                                               
|32.1    | Certification
        of Chief Executive Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley
        Act of 2002.                                                                                                
|        |                                                                                                                                                                                                                               
|32.2    | Certification
        of Chief Financial Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley
        Act of 2002.                                                                                                
|        |                                                                                                                                                                                                                               
|99.1    | Audited Financial Statements
        of Transylvania International, Inc. for the years ended December 31, 2006
        and December 31, 2005.(24)                                                                             
|        |                                                                                                                                                                                                                               
|99.2    | Unaudited Pro Forma Combined
        Balance Sheet and Statement of Operations giving effect to Searchlight
        Minerals Corp.s acquisition of Transylvania International, Inc.,
        effective February 15, 2007 (29)
|        |                                                                                                                                                                                                                               
|99.3    | Audit Committee Charter.(21)                                                                                                                                                                                                  
|        |                                                                                                                                                                                                                               
|99.4    | Disclosure Committee Charter.(6)                                                                                                                                                                                              

Notes:

|(1)  | Filed with the SEC as an exhibit to our Registration
      Statement on Form 10-SB originally filed on July 11, 2000.        
|---- | -----------------------------------------------------------------------------------------------------------------------------
|(2)  | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on April 1, 2002.                           
|(3)  | Filed with the SEC as an exhibit to our Form 8-K filed on
      December 22, 2003;                                           
|(4)  | Filed with the SEC as an exhibit to our Form S-8
      Registration Statement filed on April 10, 2002.                       
|(5)  | Filed with the SEC as an exhibit to our Form S-8 filed on
      June 30, 2003.                                               
|(6)  | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on April 13, 2004.                          
|(7)  | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on April 13, 2004.                          
|(8)  | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on April 15, 2005.                          
|(9)  | Filed with the SEC as an exhibit to our Second Amended
      Registration Statement on Form SB-2/A filed on October 30, 2006.
|(10) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on June 24, 2005.                             
|(11) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on June 16, 2005.                             
|(12) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on August 22, 2005.                      
|(13) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on October 14, 2005.                          
|(14) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on October 28, 2005.                          
|(15) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on November 21, 2005.                    
|(16) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on December 13, 2005.                         
|(17) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on March 2, 2006.                             
|(18) | Filed with the SEC as an exhibit to our Registration
      Statement on Form SB-2 originally filed on April 3, 2006.         
|(19) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on May 15, 2006.                         
|(20) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-QSB filed on August 14, 2006.                      
|(21) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on September 27, 2006.                        
|(22) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on November 28, 2006.                         
|(23) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on January 16, 2007.                          
|(24) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on February 22, 2007.                         
|(25) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on February 23, 2007.                         
|(26) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on March 5, 2007.                             
|(27) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on March 29, 2007.                            
|(28) | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on April 17, 2007.                          
|(29) | Filed with the SEC as an exhibit to our Amended Current
      Report on Form 8-K/A filed on April 26, 2007.                  
|(30) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on May 4, 2007.                               
|(31) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on May 10, 2007.                              

21

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SIGNATURES

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

|      |              |     | SEARCHLIGHT MINERALS CORP.                 
|----- | ------------ | --- | -------------------------------------------
|      |              |     |                                            
|      |              |     |                                            
|Date: | May 16, 2007 | By: | /s/ Ian R. McNeil                          
|      |              |     | IAN R. McNEIL                              
|      |              |     | President and Chief Executive
      Officer
|      |              |     | (Principal Executive Officer )             
|      |              |     |                                            
|      |              |     |                                            
|      |              |     |                                            
|Date: | May 16, 2007 | By: | /s/ Melvin L. Williams                     
|      |              |     | MELVIN L. WILLIAMS                         
|      |              |     | Chief Financial Officer                    
|      |              |     | (Principal Financial Officer )             

---