---

UNITED
STATESSECURITIES AND EXCHANGE
COMMISSIONWashington, DC
20549

FORM
10-QSB[ X ]Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act
of 1934For the quarterly period endedSeptember 30, 2007[ ] Transition Report under Section 13 or 15(d) of the Exchange
ActFor the transition period from________to
________COMMISSION FILE NUMBER000-30995

|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 Actduring 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 ExchangeAct). 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 November 14, 2007, the Issuer had 93,183,961 shares
  of common stock outstanding.

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

---

PART I - FINANCIAL INFORMATION

|ITEM 1. | FINANCIAL
      STATEMENTS.
|------- | ---------------------------

2

---

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

|                                                         |   |                    |   |   | December 31, 2006 |  
|-------------------------------------------------------- | - | ------------------ | - | - | ----------------- | -
|                                                         |   | September 30, 2007 |   |   | (restated)        |  
|                                                         |   |                    |   |   |                   |  
|ASSETS                                                   |  
|                                                         |   |                    |   |   |                   |  
|Current assets                                           |   |                    |   |   |                   |  
|Cash                                                     | $ | 8,833,969          |   | $ | 3,684,248         |  
|Prepaid expenses                                         |   | 305,428            |   |   | 106,235           |  
|                                                         |   |                    |   |   |                   |  
|Total current
      assets                               |   | 9,139,397          |   |   | 3,790,483         |  
|                                                         |   |                    |   |   |                   |  
|Property and equipment, net                              |   | 3,446,379          |   |   | 30,187            |  
|Mineral properties                                       |   | 11,624,104         |   |   | 4,793,801         |  
|Slag project                                             |   | 115,593,595        |   |   | -                 |  
|Land - smelter site and slag pile                        |   | 5,916,150          |   |   | -                 |  
|Land                                                     |   | 3,300,000          |   |   | -                 |  
|Deposits                                                 |   | 183,000            |   |   | 183,040           |  
|Joint venture option agreement                           |   | -                  |   |   | 690,000           |  
|Merger option                                            |   | -                  |   |   | 200,000           |  
|                                                         |   |                    |   |   |                   |  
|Total non-current assets                                 |   | 140,063,228        |   |   | 5,897,028         |  
|                                                         |   |                    |   |   |                   |  
|Total assets                                             | $ | 149,202,625        |   | $ | 9,687,511         |  
|                                                         |   |                    |   |   |                   |  
|LIABILITIES AND STOCKHOLDERS' EQUITY                     |  
|                                                         |   |                    |   |   |                   |  
|Current liabilities                                      |   |                    |   |   |                   |  
|Accounts payable                                         | $ | 797,178            |   | $ | 888,651           |  
|Accounts payable - related party                         |   | 43,017             |   |   | 311,863           |  
|Loan payable - related party                             |   | 382,792            |   |   | 382,792           |  
|VRIC payable, current portion                            |   | 590,000            |   |   | -                 |  
|Due to VRIC                                              |   | 6,400,000          |   |   | -                 |  
|Capital lease payable, current portion                   |   | 22,729             |   |   | -                 |  
|                                                         |   |                    |   |   |                   |  
|Total current liabilities                                |   | 8,235,716          |   |   | 1,583,306         |  
|                                                         |   |                    |   |   |                   |  
|Long-term liabilities                                    |   |                    |   |   |                   |  
|VRIC payable, net of current
      portion               |   | 2,817,404          |   |   | -                 |  
|Capital lease payable, net of current portion            |   | 70,160             |   |   | -                 |  
|Deferred tax liability                                   |   | 41,184,686         |   |   | 1,586,667         |  
|                                                         |   |                    |   |   |                   |  
|Total long-term
      liabilities                        |   | 44,072,250         |   |   | 1,586,667         |  
|                                                         |   |                    |   |   |                   |  
|Total
      liabilities                                  |   | 52,307,966         |   |   | 3,169,973         |  
|                                                         |   |                    |   |   |                   |  
|Stockholders' equity                                     |   |                    |   |   |                   |  
|Common stock, $0.001 par value; 400,000,000
      shares |   |                    |   |   |                   |  
|authorized,
      93,177,827 and 67,231,000 shares,      |   |                    |   |   |                   |  
|respectively, issued and
      outstanding               |   | 93,178             |   |   | 67,231            |  
|Additional paid-in capital                               |   | 108,517,671        |   |   | 15,978,687        |  
|Common stock subscribed                                  |   | 43,000             |   |   | -                 |  
|Accumulated deficit during
      exploration stage       |   | (11,759,190        | ) |   | (9,528,380        | )
|                                                         |   |                    |   |   |                   |  
|Total
      stockholders' equity                         |   | 96,894,659         |   |   | 6,517,538         |  
|                                                         |   |                    |   |   |                   |  
|Total liabilities and stockholders' equity               | $ | 149,202,625        |   | $ | 9,687,511         |  

See Accompanying Notes to these Consolidated Financial
Statements 2

---

|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 |   |   | For the nine months ended |   |   | Through            |  
|                                                      |   | September 30, 2007         |   |   | September 30, 2006        |   |   | September 30, 2007 |   |   | September 30, 2006 |   |   | September 30, 2007  |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   | (restated)         |   |   |                     |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Revenue - rents                                       | $ | 8,515                      |   | $ | -                         |   | $ | 28,095             |   | $ | -                  |   | $ | 28,095              |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Operating expenses                                    |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Mineral exploration and evaluation expenses           |   | 199,961                    |   |   | 642,226                   |   |   | 810,539            |   |   | 1,665,114          |   |   | 3,722,494           |  
|Mineral exploration and evaluation                    |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|expenses - related party                              |   | 90,000                     |   |   | -                         |   |   | 270,000            |   |   | -                  |   |   | 765,000             |  
|General and administrative                            |   | 471,209                    |   |   | 231,304                   |   |   | 1,374,668          |   |   | 897,925            |   |   | 3,297,602           |  
|General and administrative - related party            |   | 23,017                     |   |   | -                         |   |   | 23,017             |   |   | -                  |   |   | 23,017              |  
|Depreciation                                          |   | 11,710                     |   |   | 1,651                     |   |   | 25,952             |   |   | 4,617              |   |   | 33,211              |  
|Interest expense, net                                 |   | 1,049                      |   |   | -                         |   |   | 1,049              |   |   | -                  |   |   | 1,049               |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Total operating expenses                              |   | 796,946                    |   |   | 875,181                   |   |   | 2,505,225          |   |   | 2,567,656          |   |   | 7,842,373           |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Loss from operations                                  |   | (788,431                   | ) |   | (875,181                  | ) |   | (2,477,130         | ) |   | (2,567,656         | ) |   | (7,814,278          | )
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Other income (expense):                               |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Loss on equipment disposition                         |   | -                          |   |   | -                         |   |   | -                  |   |   | (4,398             | ) |   | (4,388              | )
|Interest and dividend income                          |   | 94,580                     |   |   | 24,106                    |   |   | 246,320            |   |   | 24,106             |   |   | 323,352             |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Total other income (expense)                          |   | 94,580                     |   |   | 24,106                    |   |   | 246,320            |   |   | 19,708             |   |   | 318,964             |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Loss from continuing operations                       |   | (693,851                   | ) |   | (851,075                  | ) |   | (2,230,810         | ) |   | (2,547,948         | ) |   | (7,495,314          | )
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Discontinued operations:                              |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Loss from discontinued operations
      (see Note 15) |   | -                          |   |   | -                         |   |   | -                  |   |   | -                  |   |   | (4,263,876          | )
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Net loss                                              |   | (693,851                   | ) |   | (851,075                  | ) |   | (2,230,810         | ) |   | (2,547,948         | ) |   | (11,759,190         | )
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Loss per common share - basic and diluted             |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Loss from continuing operations                       | $ | (0.01                      | ) | $ | (0.01                     | ) | $ | (0.03              | ) | $ | (0.04              | ) |   |                     |  
|Loss from discontinued operations                     |   | -                          |   |   | -                         |   |   | -                  |   |   | -                  |   |   |                     |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Net loss                                              | $ | (0.01                      | ) | $ | (0.01                     | ) | $ | (0.03              | ) | $ | (0.04              | ) |   |                     |  
|                                                      |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Weighted average common shares outstanding
      -    |   |                            |   |   |                           |   |   |                    |   |   |                    |   |   |                     |  
|Basic and diluted                                     |   | 93,003,914                 |   |   | 66,820,130                |   |   | 87,427,516         |   |   | 60,314,308         |   |   |                     |  

See Accompanying Notes to these Consolidated Financial
Statements 3

---

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

|                                          |  |              |  |   |            |  |   |                 |   |   |             |   |   | Accumulated    |   |   |           | 
|----------------------------------------- |  | ------------ |  | - | ---------- |  | - | --------------- | - | - | ----------- | - | - | -------------- | - | - | --------- | 
|                                          |  |              |  |   |            |  |   |                 |   |   | Common      |   |   | Deficit During |   |   | Total     | 
|                                          |  | Common Stock |  |   | Additional |  |   | Stock           |   |   | Exploration |   |   | Stockholders'  |  
|                                          |  | Shares       |  |   | Amount     |  |   | Paid-in Capital |   |   | Subscribed  |   |   | Stage          |   |   | Equity    | 
|                                          |  |              |  |   |            |  |   |                 |   |   |             |   |   |                |   |   |           | 
|Balance, December 31, 2005                |  | 52,150,000   |  | $ | 52,150     |  | $ | 6,083,298       |   | $ | 270,000     |   | $ | (5,864,945     | ) | $ | 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     | 
|                                          |  |              |  |   |            |  |   |                 |   |   |             |   |   |                |   |   |           | 
|Issuance of common stock                  |  |              |  |   |            |  |   |                 |   |   |             |   |   |                |   |   |           | 
|for mining claims (restated, see Note 15) |  | 1,400,000    |  |   | 1,400      |  |   | 3,078,600       |   |   | -           |   |   | -              |   |   | 3,080,000 | 
|                                          |  |              |  |   |            |  |   |                 |   |   |             |   |   |                |   |   |           | 
|Amortization of stock options issued      |  |              |  |   |            |  |   |                 |   |   |             |   |   |                |   |   |           | 
|to employee and officer over              |  |              |  |   |            |  |   |                 |   |   |             |   |   |                |   |   |           | 
|vesting period                            |  | -            |  |   | -          |  |   | 15,708          |   |   | -           |   |   | -              |   |   | 15,708    | 

See Accompanying Notes to these Consolidated Financial
Statements 4

---

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

|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   | Accumulated    |   |   |            |  
|----------------------------------------------- |  | ------------ |  | - | ---------- |  | - | --------------- |  | - | ----------- |  | - | -------------- | - | - | ---------- | -
|                                                |  |              |  |   |            |  |   |                 |  |   | Common      |  |   | Deficit During |   |   | Total      |  
|                                                |  | Common Stock |  |   | Additional |  |   | Stock           |  |   | Exploration |  |   | Stockholders'  |  
|                                                |  | Shares       |  |   | Amount     |  |   | Paid-in Capital |  |   | Subscribed  |  |   | Stage          |   |   | Equity     |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Net loss December 31, 2006                      |  | -            |  |   | -          |  |   | -               |  |   | -           |  |   | (3,663,435     | ) |   | (3,663,435 | )
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Balance, December 31, 2006 (restated)           |  | 67,231,000   |  |   | 67,231     |  |   | 15,978,687      |  |   | -           |  |   | (9,528,380     | ) |   | 6,517,538  |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|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                   |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|82,946 shares of common stock                   |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|to three officers and employee                  |  | -            |  |   | -          |  |   | 132,634         |  |   | -           |  |   | -              |   |   | 132,634    |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|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                                  |  | -            |  |   | -          |  |   | 11,781          |  |   | -           |  |   | -              |   |   | 11,781     |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Issuance of common stock                        |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|for mining claims (restated,
      see Note 15) |  | 1,400,000    |  |   | 1,400      |  |   | 4,506,600       |  |   | -           |  |   | -              |   |   | 4,508,000  |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Issuance of common stock                        |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|related to exercise of warrants                 |  | 400,000      |  |   | 400        |  |   | 259,600         |  |   | -           |  |   | -              |   |   | 260,000    |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Common stock subscribed for                     |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|exercise of warrants                            |  | -            |  |   | -          |  |   | -               |  |   | 25,000      |  |   | -              |   |   | 25,000     |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Common stock subscribed for                     |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|directors' compensation                         |  | -            |  |   | -          |  |   | -               |  |   | 18,000      |  |   | -              |   |   | 18,000     |  
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Net loss September 30, 2007                     |  | -            |  |   | -          |  |   | -               |  |   | -           |  |   | (2,230,810     | ) |   | (2,230,810 | )
|                                                |  |              |  |   |            |  |   |                 |  |   |             |  |   |                |   |   |            |  
|Balance, September 30, 2007                     |  | 93,177,827   |  | $ | 93,178     |  | $ | 108,517,671     |  | $ | 43,000      |  | $ | (11,759,190    | ) | $ | 96,894,659 |  

See Accompanying Notes to these Consolidated Financial
Statements 4

---

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

|                                                                             |   |                           |   |   |                    |   |   | Period from         |  
|---------------------------------------------------------------------------- | - | ------------------------- | - | - | ------------------ | - | - | ------------------- | -
|                                                                             |   |                           |   |   |                    |   |   | January 14, 2000    |  
|                                                                             |   |                           |   |   |                    |   |   | (Date of inception) |  
|                                                                             |   | For the nine months ended |   |   | through            |  
|                                                                             |   | September 30, 2007        |   |   | September 30, 2006 |   |   | September 30, 2007  |  
|CASH FLOWS FROM OPERATING ACTIVITIES                                         |   |                           |   |   |                    |   |   |                     |  
|Net loss                                                                     | $ | (2,230,810                | ) | $ | (2,547,948         | ) | $ | (11,759,190         | )
|Deduct: Loss from discontinued operations                                    |   | -                         |   |   | -                  |   |   | (4,263,876          | )
|Loss from continuing operations                                              |   | (2,230,810                | ) |   | (2,547,948         | ) |   | (7,495,314          | )
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|Adjustments to reconcile loss from operating                                 |   |                           |   |   |                    |   |   |                     |  
|to net cash used in
      operating activities:                              |   |                           |   |   |                    |   |   |                     |  
|Depreciation                                                                 |   | 25,946                    |   |   | 4,617              |   |   | 33,205              |  
|Stock based
      expenses                                                   |   | 162,415                   |   |   | 281,240            |   |   | 851,291             |  
|Loss on disposition of fixed
      assets                                    |   | -                         |   |   | 4,398              |   |   | 5,737               |  
|Amortization
      of prepaid expense                                        |   | 26,453                    |   |   | -                  |   |   | 26,453              |  
|Changes in operating assets and liabilities:                                 |   |                           |   |   |                    |   |   |                     |  
|Other current
      assets                                                   |   | (225,606                  | ) |   | (20,212            | ) |   | (331,841            | )
|Other assets                                                                 |   | -                         |   |   | -                  |   |   | (183,040            | )
|Accounts
      payable and accrued liabilities                               |   | (360,319                  | ) |   | 28,369             |   |   | 83,033              |  
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|Net cash used in operating activities                                        |   | (2,601,921                | ) |   | (2,249,536         | ) |   | (7,010,476          | )
|Net cash used in operating activities from discontinued
      operations     |   | -                         |   |   | -                  |   |   | (3,052,032          | )
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|CASH FLOW FROM INVESTING ACTIVITIES                                          |   |                           |   |   |                    |   |   |                     |  
|Cash paid on mineral property claims                                         |   | -                         |   |   | -                  |   |   | (777,134            | )
|Cash paid for merger option                                                  |   | -                         |   |   | -                  |   |   | (200,000            | )
|Cash paid to VRIC on closing date                                            |   | (9,900,000                | ) |   | -                  |   |   | (9,900,000          | )
|Cash paid for additional acquisition costs                                   |   | (130,105                  | ) |   | -                  |   |   | (130,105            | )
|Purchase of property and equipment                                           |   | (3,016,149                | ) |   | (25,291            | ) |   | (3,057,982          | )
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|Net cash used in investing activities                                        |   | (13,046,254               | ) |   | (25,291            | ) |   | (14,065,221         | )
|Net cash used in investing activities from discontinued
      operations     |   | -                         |   |   | -                  |   |   | (452,618            | )
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|CASH FLOW FROM FINANCING ACTIVITIES                                          |   |                           |   |   |                    |   |   |                     |  
|Proceeds from stock issuance                                                 |   | 21,713,817                |   |   | 6,271,376          |   |   | 30,676,001          |  
|Stock issuance costs                                                         |   | (677,570                  | ) |   | -                  |   |   | (677,570            | )
|Proceeds/payments on loan payable                                            |   | -                         |   |   | (15,000            | ) |   | -                   |  
|Principal payments on capital lease payable                                  |   | (23,351                   | ) |   | -                  |   |   | (23,351             | )
|Cash paid on deferred purchase liability                                     |   | (240,000                  | ) |   | -                  |   |   | (240,000            | )
|Proceeds from subscribed stock                                               |   | 25,000                    |   |   | -                  |   |   | 295,000             |  
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|Net cash provided by financing activities                                    |   | 20,797,896                |   |   | 6,256,376          |   |   | 30,030,080          |  
|Net cash provided by financing activities
      from discontinued operations |   | -                         |   |   | -                  |   |   | 3,384,236           |  
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|NET CHANGE IN CASH                                                           |   | 5,149,721                 |   |   | 3,981,549          |   |   | 8,833,969           |  
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|CASH AT BEGINNING OF PERIOD                                                  |   | 3,684,248                 |   |   | 705,856            |   |   | -                   |  
|                                                                             |   |                           |   |   |                    |   |   |                     |  
|CASH AT END OF PERIOD                                                        | $ | 8,833,969                 |   | $ | 4,687,405          |   | $ | 8,833,969           |  
|                                                                             |   | -                         |   |   |                    |   |   |                     |  

See Accompanying Notes to these Consolidated Financial Statements
  
  5

---

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

| |  |                           |  |  |                    |  |  | Period from         | 
| |  | ------------------------- |  |  | ------------------ |  |  | ------------------- | 
| |  |                           |  |  |                    |  |  | January 14, 2000    | 
| |  |                           |  |  |                    |  |  | (Date of inception) | 
| |  | For the nine months ended |  |  | through            | 
| |  | September 30, 2007        |  |  | September 30, 2006 |  |  | September 30, 2007  | 

|CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)                    |   |            |  |   |         |  |   |            | 
|-------------------------------------------------------------------- | - | ---------- |  | - | ------- |  | - | ---------- | 
|SUPPLEMENTAL INFORMATION                                             |   |            |  |   |         |  |   |            | 
|Interest Paid                                                        | $ | 1,049      |  | $ | -       |  | $ | 51,800     | 
|Income Taxes Paid                                                    | $ | -          |  | $ | -       |  | $ | -          | 
|Non-cash investing and financing activities:                         |   |            |  |   |         |  |   |            | 
|Capital equipment purchased through financing                        | $ | 116,239    |  | $ | -       |  | $ | 116,239    | 
|Assets acquired for common stock issued
      for the acquisition    | $ | 66,879,375 |  | $ | -       |  | $ | 66,879,375 | 
|Assets acquired for common stock issued for mineral properties       | $ | 4,508,000  |  | $ | -       |  | $ | 7,588,000  | 
|Assets acquired for liabilities incurred
      in the acquisition    | $ | 10,174,404 |  | $ | -       |  | $ | 10,174,404 | 
|Deferred tax liability assumed in the acquisition                    | $ | 37,275,716 |  | $ | -       |  | $ | 37,275,716 | 
|Deferred tax liability assumed for mineral
      properties acquired | $ | 2,322,303  |  | $ | -       |  | $ | 3,908,970  | 
|Merger option payment applied to the acquisition                     | $ | 200,000    |  | $ | -       |  | $ | 200,000    | 
|Reclassify joint venture option agreement
      to slag project      | $ | 690,000    |  | $ | -       |  | $ | 690,000    | 
|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 |  | $ | 103,000    | 

See Accompanying Notes to these Consolidated Financial Statements
  
  5

---

|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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | These financial statements have been prepared by the
        Company without audit, and include all adjustments (which consist solely
        of normal recurring adjustments, except as described in Note 15) which,
        in the opinion of management, are necessary for a fair presentation of
        financial position and results of operations. Certain information and
        footnote disclosures normally included in financial statements prepared
        in accordance with generally accepted accounting principles have been
        condensed or omitted, although the Company believes that the disclosures
        are adequate to make the information presented not misleading. It is suggested
        that these financial statements be read in conjunction with the Companys
        audited financial statements and the notes thereto for the year ended
        December 31, 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | Description of business Searchlight Minerals
        Corp. 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 and 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. The
        Company has consequently been considered an exploration stage enterprise.
        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.

6

---

|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 $11,759,190 from operations as of September
        30, 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.                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | Mineral rights- The Company capitalizes acquisition
        and option costs of mineral property rights. The amount capitalized represents
        fair value of the mineral rights acquired.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | The Company capitalizes acquisition and option costs
        of mineral rights 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.                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | Slag project costs  (See Note 10 and Note 15)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | Slag project has been restated for deferred future income
        tax liability assumed as part of the merger transaction with TI. The resulting
        estimated future federal and state income tax liability associated with
        the temporary difference between the acquisition consideration of $87,843,779
        and the tax basis of $22,003,979 as computed in accordance with SFAS 141
        and SFAS 109, resulted in an increase to the total purchase price of $37,275,716
        which was applied to the slag project asset in the absence of there being
        a goodwill component associated with the transaction in accordance with
        SFAS 141 and SFAS 109.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | Exploration costs Mineral exploration
        costs are expensed as incurred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

7

---

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

|1. | DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT
        POLICIES(continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | 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. The Company considers SFAS No. 144, Accounting
        for the Impairment or Disposal of Long-lived Assets and EITF 04-3,
        Mining Assets: Impairment and Business Combinations. 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

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)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | Revenue recognition- Revenues are recognized
        during the period in which the revenues are earned. 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 September 30, 2007 and December 31, 2006 that were not
        included in the computation of diluted EPS because the effect would be
        antidilutive were 25,434,718 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.                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | For acquired properties, deferred income tax liability
        is recorded on GAAP basis over income tax basis using statutory federal
        and state rates. The resulting estimated future federal and state income
        tax liability associated with the temporary difference between the acquisition
        consideration and the tax basis is computed in accordance with SFAS 141
        and SFAS 109, and is reflected as an increase to the total purchase price
        which is then applied to the underlying acquired assets in the absence
        of there being a goodwill component associated with the acquisition transactions
        in accordance with SFAS 141 and SFAS 109.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

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)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | 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,
        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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

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)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | 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.                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | 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.                                                                                                                                                    

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)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Correction of an error related to valuation of mineral
        properties acquired (See Note 4) The Company has determined
        that the method used in prior periods to value the mineral properties
        acquired was not appropriate. Pursuant to SFAS No. 141, Business
        Combinations, the Company values the shares issued to obtain mineral
        properties at their market price at the date of the issue. Based on the
        reassessment, the Company determined that the mineral properties have
        been understated commencing with the quarter ended September 30, 2006.
        As a result, the Company concluded that the balance sheets at September
        30, 2006, at December 31, 2006 and at June 30, 2007 should be restated.                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | The Searchlight Claims mineral properties have been
        restated to reflect the revised consideration and the deferred future
        income tax liability assumed as part of the subsequent contingent issuance
        of securities, the value of which has been added to the acquisition costs
        of the underlying mineral properties. The resulting estimated future federal
        income tax liability associated with the temporary difference between
        the acquisition consideration to date of $7,715,134 and the tax basis
        of $127,134 as computed in accordance with SFAS 141 and SFAS 109, resulted
        in an increase to the total purchase price which was applied to the mineral
        properties asset in the absence of there being a goodwill component associated
        with the transaction in accordance with SFAS 141 and SFAS 109.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | This restatement to the balance sheet at December 31,
        2006 had the impact of increasing, stockholders equity by $3,080,000,
        deferred income tax liability by $1,586,667 and the mineral asset by $4,666,667.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | This restatement to the balance sheet at June 30, 2007
        had the impact of increasing, stockholders equity by $4,508,000, deferred
        income tax liability by $2,322,303 and the mineral asset by $6,830,303.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2. | FIXED ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Fixed assets consist of the following as of September
        30, 2007 and December 31, 2006:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

| |                               |   | September 30, |  |   | December 31, | 
| | ----------------------------- | - | ------------- |  | - | ------------ | 
| |                               |   | 2007          |  |   | 2006         | 
| |                               |   |               |  |   |              | 
| | Furniture and fixtures        | $ | 34,094        |  | $ | 15,600       | 
| | Lab equipment                 |   | 2,804         |  |   | 2,804        | 
| | Computers and equipment       |   | 31,268        |  |   | 17,788       | 
| | Income property               |   | 309,750       |  |   | --           | 
| | Construction in progress      |   | 2,943,039     |  |   | --           | 
| | Vehicles                      |   | 38,175        |  |   | --           | 
| | Site equipment                |   | 119,203       |  |   |              | 
| |                               |   |               |  |   |              | 
| |                               |   | 3,478,333     |  |   | 36,192       | 
| | Less accumulated depreciation |   | 31,954        |  |   | 6,005        | 
| |                               |   |               |  |   |              | 
| |                               | $ | 3,446,379     |  | $ | 30,187       | 

12

---

|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)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

13

---

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

|3. | MERGER WITH TRANSYLVANIA INTERNATIONAL,
        INC. (continued)                                            
|-- | ------------------------------------------------------------------------------------------------------------
|   |                                                                                                             
|   | g)                                                                                                          
|   |                                                                                                             
|   | The following table reflects the components
        of the acquisition and is subject to further refinement:

| | Purchase price:                                            |   |             | 
| | ---------------------------------------------------------- | - | ----------- | 
| | Cash payments                                              | $ | 10,100,000  | 
| | Joint venture option acquired in 2005 for cash             |   | 690,000     | 
| | 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     | 
| |                                                            |   |             | 
| | Total purchase price                                       |   | 87,843,779  | 
| |                                                            |   |             | 
| | Deferred income tax liability assumed - slag
      project |   | 37,275,716  | 
| |                                                            |   |             | 
| |                                                            | $ | 125,119,495 | 

In accordance with SFAS 141, Business
  Combinations, the purchase price of $125.1 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 with the remainder allocated to the slag project.

The following table reflects allocation
  of the purchase price:

| | Allocation of purchase price:                                |   |             | 
| | ------------------------------------------------------------ | - | ----------- | 
| | Slag project (including deferred tax liability
      assumed | $ | 115,593,595 | 
| | of $37,275,716)                                              |   |             | 
| | Land - slag pile site                                        |   | 5,916,150   | 
| | Land                                                         |   | 3,300,000   | 
| | Income property and improvements                             |   | 309,750     | 
| |                                                              |   |             | 
| | Net assets acquired                                          | $ | 125,119,495 | 

For the nine months ended September 30,
  2007, 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.

14

---

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

|4. | MINERAL PROPERTIES - MINING CLAIMS  AS RESTATED
        (See Note 15)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | As of September 30, 2007, mining claims totaling $11,624,104
        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 June 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.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | 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 following table summarizes the impact of the restatement
        on the historical balances of mineral properties reported for periods
        ended as noted:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

| |                                                                  |   | As Reported |  |   | Adjustments |  |   | As Restated | 
| | ---------------------------------------------------------------- | - | ----------- |  | - | ----------- |  | - | ----------- | 
| | Share issuance to obtain mineral properties,
      July 7, 2005  | $ | 127,134     |  | $ | --          |  | $ | 127,134     | 
| | Mineral properties balance, December 31, 2005                    |   | 127,134     |  |   | --          |  |   | 127,134     | 
| | Share issuance to obtain mineral properties,
      July 27, 2006 |   | --          |  |   | 3,080,000   |  |   | 3,080,000   | 
| | Deferred income tax liability assumed                            |   | --          |  |   | 1,586,667   |  |   | 1,586,667   | 
| | Mineral properties balance, December
      31, 2006              |   | 127,134     |  |   | 4,666,667   |  |   | 4,793,801   | 
| | Share issuance to obtain mineral properties, June 29, 2007       |   | --          |  |   | 4,508,000   |  |   | 4,508,000   | 
| | Deferred income tax liability assumed                            |   | --          |  |   | 2,322,303   |  |   | 2,322,303   | 
| | Total mineral properties balance, September 30, 2007             | $ | 127,134     |  | $ | 11,496,970  |  | $ | 11,624,104  | 

|5. | LOAN PAYABLE  FORMER OFFICERS AND DIRECTORS                                                                                                                                                                                                                                                                                                                                                                           
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | As of September 30, 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.

15

---

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

|6. | CAPITAL LEASE PAYABLE                                                                                                                               
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                     
|   | The Company leases equipment under capital lease. Capital
        lease payable consisted of the following at September 30, and December
        31,

| |                                            |  |            |  |   | Monthly |  |  | Interest |  |  |          |         |   |        |    |   |      | 
| | ------------------------------------------ |  | ---------- |  | - | ------- |  |  | -------- |  |  | -------- | ------- | - | ------ | -- | - | ---- | 
| | Lender                                     |  | Collateral |  |   | Payment |  |  | Rate     |  |  | Maturity |         |   | 2007   |    |   | 2006 | 
| | Caterpillar Financial Services Corporation |  |            |  |   |         |  |  |          |  |  |          |         |   |        |    |   |      | 
| |                                            |  | Equipment  |  | $ | 2,200   |  |  | 4.45%    |  |  | Jul-11   |         | $ | 92,889 |    | $ | --   | 
| |                                            |  |            |  |   |         |  |  |          |  |  |          |         |   |        |    |   |      | 
| |                                            |  |            |  |   |         |  |  |          |  |  |          |         |   | 92,889 |    |   | --   | 
| | Capital lease payable, current portion     |  |            |  |   |         |  |  |          |  |  |          | (22,729 | ) |        | -- |  
| |                                            |  |            |  |   |         |  |  |          |  |  |          |         |   |        |    |   |      | 
| | Capital lease payable, net of current      |  |            |  |   |         |  |  |          |  |  |          |         |   |        |    |  
| | portion                                    |  |            |  |   |         |  |  |          |  |  |          |         | $ | 70,160 |    | $ | --   | 

The following table represents future
  minimum lease payments on capital lease payable for the nine months ending September
  30,

| | 2008                                           | $ | 26,401  |  
| | ---------------------------------------------- | - | ------- | -
| | 2009                                           |   | 26,401  |  
| | 2010                                           |   | 26,401  |  
| | 2011                                           |   | 22,001  |  
| | Thereafter                                     |   | --      |  
| |                                                |   |         |  
| | Total future minimum lease payments            | $ | 101,204 |  
| | Imputed interest                               |   | (8,315  | )
| |                                                |   |         |  
| | Present value of future minimum lease payments | $ | 92,889  |  

The following assets acquired under capital
  lease and related amortization were included in property, plant and equipment
  at September 30, and December 31,

| |                          |   | 2007    |   |   | 2006 | 
| | ------------------------ | - | ------- | - | - | ---- | 
| | Site Equipment           | $ | 116,239 |   | $ | --   | 
| | Accumulated amortization |   | (11,301 | ) |   | --   | 
| |                          | $ | 104,938 |   | $ | --   | 

16

---

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

|7. | STOCKHOLDERS EQUITY                                                                                                               
|-- | -----------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                    
|   | During the nine months ended September 30,
        2007, the Companys stockholders activities consisted of the
        following:
|   |                                                                                                                                    
|   | a)                                                                                                                                 
|   |                                                                                                                                    
|   | b)                                                                                                                                 
|   |                                                                                                                                    
|   | c)                                                                                                                                 
|   |                                                                                                                                    
|   | d)                                                                                                                                 
|   |                                                                                                                                    
|   | e)                                                                                                                                 

17

---

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

|7. | STOCKHOLDERS EQUITY(continued)
|-- | -------------------------------
|   |                                
|   | f)                             
|   |                                
|   | g)                             
|   |                                
|   | h)                             

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

18

---

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

|8. | OPTION PLAN                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On 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. 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 amended the number of shares of the Companys
        common stock available for issuance under the 2007 Plan to a maximum of
        4,000,000.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | 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.                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | During the nine months ended September 30,
        2007, the Company granted stock options as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

Compensation expense for the nine months
  ended September 30, 2007 and for the three months ended September 30, 2007 related
  to granting of stock options was $144,415 and $1,312, respectively.

Stock options  During the
  nine months ended September 30, 2007 and the year ended December 31, 2006, the
  Company granted stock options to employees and directors totaling 82,946 and
  870,000, respectively, with a weighted average strike price of $3.99 and $2.25
  per share, respectively. Certain stock options were exercisable upon grant and
  have a life of 5 years. As of September 30, 2007 stock options outstanding totaled
  3,952,946 with a weighted average strike price of $0.84 per share.

The following table summarizes the Companys
  stock option activity for the nine months ended September 30, 2007:

| |                             |  | Number of |  |   | Weighted       | 
| | --------------------------- |  | --------- |  | - | -------------- | 
| |                             |  | Shares    |  |   | Average        | 
| |                             |  |           |  |   | Exercise Price | 
| | Balance, December 31, 2006  |  | 3,870,000 |  | $ | 0.77           | 
| | Options granted and assumed |  | 82,946    |  |   | 3.99           | 
| | Options expired             |  | --        |  |   | --             | 
| | Options cancelled           |  | --        |  |   | --             | 
| | Options exercised           |  | --        |  |   | --             | 
| |                             |  |           |  |   |                | 
| | Balance, September 30, 2007 |  | 3,952,946 |  | $ | 0.84           | 

19

---

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

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

| |                         | 2007           | 2006          
| | ----------------------- | -------------- | --------------
| |                         |                |               
| | Dividend yield          | --             | --            
| | Expected volatility     | 76.6%          | 85%           
| | Risk-free interest rate | 4.56% to 4.68% | 4.89% to 5.08%
| | Expected life (years)   | 2 to 5         | 5             

Accordingly, the Company valued the services
  under SFAS No. 123R relating to non-statutory stock options upon grant in 2007
  for $144,415 as of September 30, 2007. Based on recent historical stock activity
  the equal probability option pricing model was applied.

The following table summarizes information
  about options granted during the nine months ended September 30, 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        | 
| | 82,946            |  | Equals              |  | $ | 3.99     |  | $ | 3.45 to $4.04 |  | $ | 0.40         | 
| | --                |  | Exceeds             |  | $ | --       |  | $ | -- to $ --    |  | $ | --           | 
| | --                |  | Less Than           |  | $ | --       |  | $ | -- to $ --    |  | $ | --           | 
| |                   |  |                     |  |   |          |  |   |               |  |   |              | 
| | 82,946            |  | Equals              |  | $ | 3.99     |  | $ | 3.45 to $4.04 |  | $ | 0.40         | 

Stock options/warrants 
  During the nine months ended September 30, 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 nine months ended September
  30, 2007 the Company issued stock options for 82,946 shares of common stock
  to three officers and two employees with strike price of $3.45 to $4.04 per
  share.

20

---

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

|8. | OPTION PLAN(continued)                                                                                                            
|-- | ----------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                   
|   | The following table summarizes information about options/warrants
        granted during the nine months ended September 30, 2007:

| |                                      |  | Number of  |   |   | Weighted       | 
| | ------------------------------------ |  | ---------- | - | - | -------------- | 
| |                                      |  | Shares     |   |   | Average        | 
| |                                      |  |            |   |   | Exercise Price | 
| | Balance, December 31, 2006           |  | 20,160,000 |   | $ | 0.51           | 
| | Options/warrants granted and assumed |  | 3,922,204  |   | $ | 4.49           | 
| | Options/warrants expired             |  | --         |   |   | --             | 
| | Options/warrants cancelled           |  | --         |   |   | --             | 
| | Options/warrants exercised           |  | (400,000   | ) | $ | 0.65           | 
| |                                      |  |            |   |   |                | 
| | Balance, September 30, 2007          |  | 23,682,204 |   | $ | 1.17           | 

|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.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | 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.                                                                                                                                                                         

21

---

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

|10. | INCOME TAXES                                                                                                                                          
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                       
|    | The Company is a Nevada corporation and is subject to
        federal and Arizona income taxes. Nevada does not impose a corporate income
        tax.
|    |                                                                                                                                                       
|    | The provision for income taxes consisted of the following
        at September 30, 2007 and December 31, 2006,                                        

| |                               |   | September 30, |   |   | December 31, |  
| | ----------------------------- | - | ------------- | - | - | ------------ | -
| |                               |   | 2007          |   |   | 2006         |  
| |                               |   |               |   |   |              |  
| | Income tax benefit at 34%     | $ | (758,475      | ) | $ | (1,241,566   | )
| | Non-deductible and other      |   | 3,789         |   |   | 3,199        |  
| | Change in valuation allowance |   | 754,686       |   |   | 1,238,367    |  
| |                               |   |               |   |   |              |  
| | Provision for income taxes    | $ | --            |   | $ | --           |  

Significant components of the Companys
  net deferred income tax assets at September 30, 2007 and December 31, 2006 were
  as follows:

| |                                  |   | September 30, |   |   | December 31, |  
| | -------------------------------- | - | ------------- | - | - | ------------ | -
| |                                  |   | 2007          |   |   | 2006         |  
| |                                  |   |               |   |   |              |  
| | Net Operating loss carry forward | $ | 2,319,412     |   | $ | 1,619,947    |  
| | Option compensation              |   | 254,419       |   |   | 199,198      |  
| |                                  |   |               |   |   |              |  
| | Deferred income tax asset        |   | 2,573,831     |   |   | 1,819,145    |  
| | Valuation allowance              |   | (2,573,831    | ) |   | (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 September 30, 2007 and December 31,
  2006.

22

---

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

|10. | INCOME TAXES(continued)                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                         
|    | Significant components of the Companys net deferred
        income tax liabilities at September 30, 2007 and December 31, 2006 were
        as follows:

| |                                                        |   | September 30, |  |   | December 31, | 
| | ------------------------------------------------------ | - | ------------- |  | - | ------------ | 
| |                                                        |   | 2007          |  |   | 2006         | 
| |                                                        |   |               |  |   | (restated)   | 
| |                                                        |   |               |  |   |              | 
| | Mineral properties  federal rate of 34%               | $ | 3,908,970     |  | $ | 1,586,667    | 
| | Slag project  federal rate of 34%                     |   | 34,099,556    |  |   | --           | 
| | Slag project  state at statutory rate
      of 4.599% |   | 3,176,160     |  |   | --           | 
| |                                                        |   |               |  |   |              | 
| |                                                        |   |               |  |   |              | 
| | Deferred income tax liability                          | $ | 41,184,686    |  | $ | 1,586,667    | 

Deferred income tax liability was recorded
  on GAAP basis over income tax basis using statutory federal and state rates
  with the corresponding increase in the purchase price allocation to the assets
  acquired.

The resulting estimated future federal
  and state income tax liability associated with the temporary difference between
  the acquisition consideration and the tax basis as computed in accordance with
  SFAS 141 and SFAS 109, is reflected as an increase to the total purchase price
  which has been applied to the underlying mineral and slag project assets in
  the absence of there being a goodwill component associated with the acquisition
  transactions in accordance with SFAS 141 and SFAS 109.

The Company had cumulative net operating
  losses of approximately $6,821,800 and $4,764,549 as of September 30, 2007 and
  December 31, 2006, respectively for federal income tax purposes. The net operating
  loss carryforwards expiring between 2027 and 2025. The Company had no material
  loss carryforwards for state income tax purposes.

23

---

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

|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. Subsequent to September 30, 2007, on October
        1, 2007, rent amount increased to $4,900 per month for additional office
        space.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | Rental expense, resulting from this operating lease
        agreement, approximated $32,151 for the nine months ended September 30,
        2007 and $12,000 for three months ended September 30, 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

24

---

|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 nine months ended September 30, 2007, the Company
        purchased services from one major vendor Talson Corporation that exceeded
        more than 10% of total purchases and amounted to approximately $1,496,233.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|14. | RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | During the nine months ended September 30, 2007 and
        2006, the Company utilized the services of NMC to provide 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | For the nine months ended September 30, 2007, the Company
        incurred total fees and reimbursement of expenses to NMC of $270,000 and
        $63,926, respectively at September 30, 2007, the Company had an outstanding
        balance due to NMC of $20,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

25

---

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

|14. | RELATED PARTY TRANSACTIONS(continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | For the three months ended September 30, 2007, the Company
        incurred total fees and reimbursement of expenses to NMC of $90,000 and
        $12,880, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | During the nine months ended September 30, 2007, the
        Company utilized Cupit, Milligan, Ogden & Williams, CPAs (CMOW) to
        provide accounting support services. The Chief Financial Officer of the
        Company is affiliated with CMOW.                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | The Company incurred total fees and reimbursement of
        expenses to CMOW of $21,873 and $1,144, respectively, for the three and
        nine months ended September 30, 2007, At September 30, 2007, the Company
        had an outstanding balance due to CMOW of $23,017.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|15. | RESTATEMENT OF PRIOR FINANCIAL STATEMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Mineral properties acquisition costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Mineral properties have been restated to reflect payments
        made by issuance of 1,400,000 shares at $3.22 on June 29, 2007 and 1,400,000
        shares at $2.20 on July 27, 2006 at the market values on the dates of
        issuance. This restatement had the impact of increasing the mineral properties
        and additional paid-in capital at June 30, 2007 by $4,508,000 and at December
        31, 2006 by $3,080,000. Mineral properties also increased by $2,322,303
        at June 30, 2007 and by $1,586,667 at December 31, 2006 for deferred income
        tax liability assumed.                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | The company initially valued the total transaction 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Slag project                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Slag project has been restated for deferred future income
        tax liability assumed as part of the merger transaction with TI. The resulting
        estimated future federal and state income tax liability associated with
        the temporary difference between the acquisition consideration of $87,843,779
        and the tax basis of $22,003,979 as computed in accordance with SFAS 141
        and SFAS 109, resulted in an increase to the total purchase price of $37,275,716
        which was applied to the slag project asset in the absence of there being
        a goodwill component associated with the transaction in accordance with
        SFAS 141 and SFAS 109.                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | This restatement had the impact of increasing the deferred
        income tax liability from $33,151,312 as previously reported at March
        31, 2007 to $37,275,716 as restated. The resulting restatement increased
        deferred income tax liability and the slag project asset by $4,124,404.                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | The consolidated unaudited statement of operation for
        the period from January 14, 2000 (date of inception) through December
        31, 2006 has been restated to reclassify net losses prior to January 1,
        2005 as discontinued operations. 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
        exploration of gold and other precious metal deposits. Activity between
        January 1 and February 10, 2005 consisted of minor general and administrative
        expenses and as a result was not included in loss from discontinued operations.

26

---

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

|15. | RESTATEMENT OF PRIOR FINANCIAL STATEMENTS(continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The consolidated unaudited statement of operations for
        the nine months ended September 30, 2006, has been restated to reclassify
        foreign currency translation adjustment as general and administrative
        expense. Foreign currency translation adjustment was related to translation
        of accounts payable assumed as part of reorganization in 2005. This restatement
        had the impact of increasing net loss and eliminating other comprehensive
        loss for the nine months ended September 30, 2006 by $11,769. Related
        to the same issue, the consolidated balance sheet at December 31, 2006
        has been restated to reclassify accumulated other comprehensive loss as
        accumulated deficit during explorations stage. The companys accumulated
        other comprehensive loss consists of the accumulated foreign currency
        translation adjustments. These restatements had the impact of eliminating
        accumulated other comprehensive loss and increasing accumulated deficit
        during exploration stage at December 31, 2006 by $121,606.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The following table summarizes unaudited consolidated
        balance sheets of the Company as of December 31, 2006, March 31, 2007
        and June 30, 2007, and reconciles the reported amounts to the restated
        amounts:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

| | Summarized Consolidated Balance Sheet -            |   | As Reported |   |   | Adjustments |   |  |   |  |   | As Restated |  
| | -------------------------------------------------- | - | ----------- | - | - | ----------- | - |  | - |  | - | ----------- | -
| | December 31, 2006                                  |   | (audited)   |   |   | (unaudited) |   |  |   |  |   | (unaudited) |  
| |                                                    |   |             |   |   |             |   |  |   |  |   |             |  
| | Mineral properties                                 | $ | 127,134     |   | $ | 4,666,667   |   |  | a |  | $ | 4,793,801   |  
| | Deferred tax liability                             |   | --          |   |   | 1,586,667   |   |  | a |  |   | 1,586,667   |  
| | Additional paid-in capital                         |   | 12,898,687  |   |   | 3,080,000   |   |  | a |  |   | 15,978,687  |  
| | Accumulated other comprehensive loss               |   | (121,606    | ) |   | 121,606     |   |  | b |  |   | --          |  
| | Accumulated deficit during exploration
      stage |   | (9,406,774  | ) |   | (121,606    | ) |  | b |  |   | (9,528,380  | )

| | Summarizes Consolidated Balance Sheet -      |   | As Reported |   |   | Adjustments |   |  |     |  |   | As Restated |  
| | -------------------------------------------- | - | ----------- | - | - | ----------- | - |  | --- |  | - | ----------- | -
| | March 31, 2007                               |   | (unaudited) |   |   | (unaudited) |   |  |     |  |   | (unaudited) |  
| |                                              |   |             |   |   |             |   |  |     |  |   |             |  
| | Mineral properties                           | $ | 127,134     |   | $ | 4,666,667   |   |  | a   |  | $ | 4,793,801   |  
| | Slag project                                 |   | 111,469,191 |   |   | 4,124,404   |   |  | c   |  |   | 115,593,595 |  
| | Deferred tax liability                       |   | 33,151,312  |   |   | 5,711,071   |   |  | a,c |  |   | 38,862,383  |  
| | Additional paid-in capital                   |   | 100,656,349 |   |   | 3,080,000   |   |  | a   |  |   | 103,736,349 |  
| | Accumulated other comprehensive loss         |   | (121,606    | ) |   | 121,606     |   |  | b   |  |   | --          |  
| | Accumulated deficit during exploration stage |   | (10,086,803 | ) |   | (121,606    | ) |  | b   |  |   | (10,208,409 | )

| | Summarized Consolidated Balance Sheet -      |   | As Reported |   |   | Adjustments |   |  |     |  |   | As Restated |  
| | -------------------------------------------- | - | ----------- | - | - | ----------- | - |  | --- |  | - | ----------- | -
| | June 30, 2007                                |   | (unaudited) |   |   | (unaudited) |   |  |     |  |   | (unaudited) |  
| |                                              |   |             |   |   |             |   |  |     |  |   |             |  
| | Mineral properties                           | $ | 127,134     |   | $ | 11,496,970  |   |  | a   |  | $ | 11,624,104  |  
| | Slag project                                 |   | 111,469,191 |   |   | 4,124,404   |   |  | c   |  |   | 115,593,595 |  
| | Deferred tax liability                       |   | 33,151,312  |   |   | 8,033,374   |   |  | a,c |  |   | 41,184,686  |  
| | Additional paid-in capital                   |   | 100,668,760 |   |   | 7,588,000   |   |  | a   |  |   | 108,256,760 |  
| | Accumulated other comprehensive loss         |   | (121,606    | ) |   | 121,606     |   |  | b   |  |   | --          |  
| | Accumulated deficit during exploration stage |   | (10,943,733 | ) |   | (121,606    | ) |  | b   |  |   | (11,065,339 | )

27

---

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

|15. | RESTATEMENT OF PRIOR FINANCIAL STATEMENTS(continued)                                                                                                                                                                                                                                                    
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                         
|    | The following table summarizes unaudited consolidated
        statements of operations for the nine months ended September 30, 2006
        and for the period from January 14, 2000 (Date of Inception) through December
        31, 2006, and reconciles the reported amounts to the restated amounts:

| | Summarized Consolidated Statement of Operations -              |   | As Reported |   |   | Adjustments |   |  |     |  |   | As Restated |  
| | -------------------------------------------------------------- | - | ----------- | - | - | ----------- | - |  | --- |  | - | ----------- | -
| | For the nine months
      ended September 30, 2006             |   | (unaudited) |   |   | (unaudited) |   |  |     |  |   | (unaudited) |  
| |                                                                |   |             |   |   |             |   |  |     |  |   |             |  
| | General and administrative                                     | $ | 886,156     |   | $ | 11,769      |   |  | d   |  | $ | 897,925     |  
| | Total operating expenses                                       |   | 2,555,887   |   |   | 11,769      |   |  | d   |  |   | 2,567,656   |  
| | Net loss                                                       |   | (2,536,179  | ) |   | (11,769     | ) |  | d   |  |   | (2,547,948  | )
| | Foreign currency translation adjustment                        |   | (11,769     | ) |   | 11,769      |   |  | d   |  |   | --          |  
| |                                                                |   |             |   |   |             |   |  |     |  |   |             |  
| | Summarized Consolidated Statement of Operations
      -        |   |             |   |   |             |   |  |     |  |   |             |  
| | For the period from January 14, 2000 (Date
      of Inception) |   | As Reported |   |   | Adjustments |   |  |     |  |   | As Restated |  
| | Through December 31, 2006                                      |   | (audited)   |   |   | (unaudited) |   |  |     |  |   | (unaudited) |  
| |                                                                |   |             |   |   |             |   |  |     |  |   |             |  
| | Research and development                                       | $ | 1,900,095   |   | $ | (1,900,095  | ) |  | e   |  | $ | --          |  
| | Mineral exploration and evaluation expenses                    |   | 3,406,955   |   |   | (495,000    | ) |  | f   |  |   | 2,911,955   |  
| | Mineral exploration and evaluation                             |   |             |   |   |             |   |  |     |  |   |             |  
| | expenses - related party                                       |   | --          |   |   | 495,000     |   |  | f   |  |   | 495,000     |  
| | General and administrative                                     |   | 3,664,997   |   |   | (1,742,063  | ) |  | g   |  |   | 1,922,934   |  
| | Depreciation                                                   |   | 242,433     |   |   | (235,174    | ) |  | h   |  |   | 7,259       |  
| | Impairment loss on intangible assets                           |   | 173,234     |   |   | (173,234    | ) |  | i   |  |   | --          |  
| | Impairment loss on property and equipment                      |   | 86,683      |   |   | (86,683     | ) |  | j   |  |   | --          |  
| | Total operating expenses                                       |   | 9,474,397   |   |   | (4,137,249  | ) |  | k   |  |   | 5,337,148   |  
| | Loss from operations                                           |   | (9,474,397  | ) |   | 4,137,249   |   |  | k   |  |   | (5,337,148  | )
| | Other income                                                   |   | 282,142     |   |   | (282,142    | ) |  | l   |  |   | --          |  
| | Interest expense, net                                          |   | (300,000    | ) |   | 300,000     |   |  | m   |  |   | --          |  
| | Total other income (expense)                                   |   | 54,786      |   |   | 17,858      |   |  | l,m |  |   | 72,644      |  
| | Loss from operations before provision
      for income tax     |   | (9,419,611  | ) |   | 4,155,107   |   |  | n   |  |   | (5,264,504  | )
| | Income tax benefit                                             |   | 12,837      |   |   | (12,837     | ) |  | o   |  |   | --          |  
| | Net loss                                                       |   | (9,406,774  | ) |   | 4,142,270   |   |  | p   |  |   | (5,264,504  | )
| | Foreign currency translation adjustment                        |   | (121,606    | ) |   | 121,606     |   |  | b   |  |   | --          |  
| | Loss from discontinued operations                              |   | --          |   |   | (4,263,876  | ) |  | b,p |  |   | (4,263,876  | )

The restatements had no impact on the
  Companys cash or cash flows.

28

---

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

|15. | RESTATEMENT OF PRIOR FINANCIAL STATEMENTS(continued)
|--- | ----------------------------------------------------

The restatement adjustments are as follows:

Mineral properties  The
  Company has determined that the method used in prior periods to value the mineral
  properties acquired was not appropriate.

| | a. | Restate issuance of 1,400,000 shares to obtain mineral
        properties on July 27, 2006 at the market value of $2.20 per share and
        1,400,000 shares on June 29, 2007 at the market value of $3.22 per share
        on the dates of issuance. The resulting estimated future income tax liability
        associated with the temporary difference between tax basis and acquisition
        value was applied to the mineral asset in the absence of there being a
        goodwill component associated with the transaction.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Slag project

| | c. | Restate Slag project for deferred future income tax
        liability assumed as part of the merger transaction with TI. The resulting
        estimated future federal and state income tax liability associated with
        the temporary difference between the acquisition consideration of $87,843,779
        and the tax basis of $22,003,979 as computed in accordance with SFAS 141
        and SFAS 109, resulted in an increase to the total purchase price of $37,275,716
        which was applied to the slag project asset in the absence of there being
        a goodwill component associated with the transaction in accordance with
        SFAS 141 and SFAS 109.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Discontinued operations 
  Management has determined that of $11,759,190 accumulated deficit incurred since
  inception on January 14, 2000 through September 30, 2007, $4,263,876 was incurred
  for a biotechnology research and development business. Therefore, it is now
  reported as discontinued operations.

| | b. | Reclassify accumulated other comprehensive loss prior
        to 2005 from a biotechnology research and development business as discontinued
        operations.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
| | e. | Reclassify research and development expense incurred
        prior to 2005 as discontinued operations.                                                          
| | g. | Reclassify general and administrative expense incurred
        prior to 2005 as discontinued operations.                                                        
| | h. | Reclassify depreciation expense incurred prior to 2005
        as discontinued operations.                                                                      
| | i. | Reclassify impairment loss on intangible assets incurred
        prior to 2005 as discontinued operations.                                                      
| | j. | Reclassify impairment loss on property and equipment
        incurred prior to 2005 as discontinued operations.                                                 
| | k. | Reclassify operating expenses incurred prior to 2005
        as discontinued operations.                                                                        
| | l. | Reclassify other income earned prior to 2005 as discontinued
        operations.                                                                                
| | m. | Reclassify interest expense incurred prior to 2005 as
        discontinued operations.                                                                          
| | n. | Reclassify losses prior to 2005 as discontinued operations.                                                                                                     
| | o. | Reclassify income tax benefit prior to 2005 as discontinued
        operations.                                                                                 
| | p. | Reclassify net losses prior to 2005 as discontinued
        operations.                                                                                         

Reclassifications

| | d. | Reclassify foreign currency translation adjustment from
        the period ended March 31, 2006 as general and administrative expense.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------
| | f. | Reclassify related party mineral exploration and evaluation
        expense.                                                          

29

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|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.

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

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; and (ii) the Searchlight Gold Project,
  located near Searchlight, Nevada. The Clarkdale Slag Project is a precious and
  base metal recovery project where we are seeking to reprocess slag material
  produced from the smelting of copper ores from former mines located around Jerome,
  Arizona. The Searchlight Gold Project is a 3,200 acre placer gold project.

During the quarter ended September 30, 2007, we
continued to make progress on our development of the Clarkdale Slag Project.
During the quarter, our building construction and site preparation for the
project site continued to advance and we completed the purchase of much of the
processing equipment for our first production module for the project. See Plan
of Operation  Clarkdale Slag Project, below. Also during the quarter ended
September 30, 2007, we received metallurgical testing results on
chain-of-custody samples collected from the Searchlight Gold Project. A
discussion of these results is provided below under Recent Corporate
Developments.

RECENT CORPORATE DEVELOPMENTS

The following significant corporate developments
have occurred since June 30, 2007, the date of our last Quarterly
Report:

|1. | On July 27, 2007, we appointed Harry Crockett to serve on
      our compensation committee. As a result of Mr. Crocketts appointment, our
      compensation committee now consists of Robert D. McDougal and Mr.
      Crockett. Mr. Crockett has served on our Board of Directors since February
      16, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2. | On August 20, 2007, we reported the results of additional
      metallurgical testing conducted by our independent mining consultants,
      Arrakis, Inc. ("Arrakis"), on chain-of-custody samples collected from the
      Searchlight Gold Project. We had engaged Arrakis to perform this
      additional testing following the tests completed by them in early 2007,
      the results of which were reported by us on January 29, 2007. The test
      results received in January, 2007 had indicated that autoclave processing
      would be a reliable and consistent method of extraction. To test other
      processing/extraction methods, Arrakis obtained additional
      chain-of-custody samples from the Searchlight Gold Project and conducted
      tests using various metallurgical methods, including mineral and organic
      acid leaching combined with appropriate

3

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oxidizers, cyanide
leaching, and autoclave leaching using chloride based lixiviant. Gravity
concentration was also examined to upgrade the feed prior to leaching. Based on
the results of these additional tests, Arrakis concluded that autoclave
processing, while more capital intensive than the alternative methods tested,
produced the most reliable and consistent results on the materials extracted
from the Searchlight Gold Project, and was likely the most suitable to
commercial sized production scales. Readers are cautioned that we have not yet
established any proven or probable mineral reserves on the Searchlight Gold
Project, and there are no assurances that we will be able to do so in the
future. We are still in the process of conducting our exploration program for
the Searchlight Gold Project as well as continuing bench and pilot testing to
optimize gold recovery into solution and extraction of the gold from the
pregnant solution.

|3. | On October 4, 2007, we engaged DCM Structured Finance
      Limited (DCMSF) of London, England, to advise and assist us on various
      corporate finance matters, including advising and assisting us with
      respect to seeking and obtaining financing for our Clarkdale Slag
      Project.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

DCMSF is an affiliate of
DCM Securities Limited, a company based in London, England, that specializes in
providing corporate finance advice. DCMSFs Metals & Mining Advisory Team
consists of professionals who have been involved in the metals and mining sector
for decades. Its team of professionals has extensive experience in debt
structuring, equity valuation and financial modeling along with a strong
technical understanding of the industry. DCMSF has advised and assisted a number
of mining companies on arranging and structuring various financing alternatives.
DCM Securities Limited is authorized and regulated by the Financial Services
Authority.

In consideration for their
services, we have agreed to pay DCMSF the following commissions on any financing
received by us from a source introduced or referred to us by DCMSF (a Referred
Financing):

| | (a) | an advisory success fee equal to one percent (1.0%) of
      the total principal amount of any Referred Financing; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | (b) | one half of one percent (0.5%) of one stock purchase
      warrant for each $1.00 of the total principal amount of any Referred
      Financing. Each one full stock purchase warrant issued to DCMSF under the
      terms of their engagement will entitle DCMSF to purchase one share of our
      common stock. The exercise price will be equal to the closing price of our
      common stock on the date the engagement letter was executed by both DCMSF
      and the Company. The closing price of our common stock as quoted on the
      OTC Bulletin Board on October 4, 2007 was $2.87.

We have also agreed to
reimburse DCMSF for any properly documented, reasonable costs and expenses
incurred by it in connection with performing its duties under the engagement.
Unless otherwise agreed to in writing, the engagement will terminate upon the
earlier of our obtaining full financing for the Clarkdale Slag Project and the
date that is nine (9) months from the date of DCMSFs engagement.

|4. | On November 13, 2007, we issued 6,134 shares of our
      common stock to our non-management directors. These shares were issued
      pursuant to the director compensation policy for our non- management
      directors based on a price of $2.85 per share, being the closing price of
      our common stock on September 28, 2007, the last trading day of our
      previous fiscal quarter. Directors compensation expense and common stock
      subscribed for were recorded in the amount of $18,000 as of that date. The
      shares were issued under Section 4(2) of the Securities Act.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4

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PLAN OF OPERATION

The following discussion and analysis
summarizes our plan of operation for the next twelve months, our results of
operations for the nine months ended September 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

During our second fiscal quarter ended June 30,
2007, we completed a materials study on the main slag pile located on the
Clarkdale Slag Project site. The results of this study were reported in our
Quarterly Report on Form 10-QSB filed with the SEC on August 16, 2007 and in our
amended Registration Statement on Form SB-2/A filed with the SEC on June 15,
2007.

Our plan of operation for the Clarkdale Slag
Project currently involves the following:

|(a) | Construction and rehabilitation of buildings on the
      project site that are expected to serve as the production and operations
      facilities for the project;                      
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                           
|(b) | Continue small scale pilot testing and site work to
      assist with the optimization of the metallurgical flow sheet and
      processing protocols for our first production module; and
|    |                                                                                                                                                                                           
|(c) | Installation of our first production module.                                                                                                                                              

We expect to complete the majority of each of the
above during the fourth quarter of 2007. The initial production module being
installed by us will consist of a full scale production and processing circuit
expected to process between 100-250 tons per day (tpd) of slag material. Our
plans for the final processing facility are expected to include a number of
additional production modules that will work simultaneously during full scale
operations. The first production module being constructed by us will be used to
optimize and test the economic feasibility of the Clarkdale Slag Project, which
is expected to occur during the first fiscal quarter of 2008. This first full
scale production module is expected to serve as a final feasibility study for
the Clarkdale Slag Project. If the operation of this first production module
proves that the Clarkdale Slag Project is economically feasible, we will seek to
begin financing the construction of additional production modules for the
project and our full scale processing facility.

Until such time as we have established economic
feasibility of the Clarkdale Slag Project through our feasibility studies and
the operation of our first full circuit production module for the slag pile,
there is no assurance that we will proceed to the construction of our proposed
processing facility. If the results from our feasibility studies and the
production results from our first production module are not sufficiently
positive to justify our proceeding with the construction of our processing
facility we will have to scale back or abandon our plans for the Clarkdale Slag
Project.

Searchlight Gold Project

In early 2007, we received the results of
metallurgical and analytical tests conducted by Arrakis on chain of custody
surface samples and bulk samples (6 tons) taken from the Searchlight Gold
Project. The results of these tests were reported by us in our Annual Report on
Form 10-KSB filed with the SEC on April 17, 2007, our Quarterly Reports on Form
10-QSB filed with the SEC on May 17, 2007 and August 16, 2007, and our amended
Registration Statement on Form SB-2/A filed with the SEC on June 15,
2007.

These results had indicated that autoclave
processing would be the most reliable and consistent method of extracting gold
from the sample materials tested. To test other processing/extraction methods,
Arrakis obtained additional chain-of-custody samples from the Searchlight Gold
Project and conducted tests using various metallurgical methods, including
mineral and organic acid leaching combined with appropriate oxidizers, cyanide
leaching, and autoclave leaching using chloride based lixiviants. Gravity
concentration was also examined to upgrade the feed prior to leaching. Based on
the results of these additional tests, Arrakis concluded that autoclave
processing, while more capital intensive than the alternative methods tested,

5

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produced the most reliable and consistent results
on the materials extracted from the Searchlight Gold Project, and was likely the
most suitable to commercial sized production scales.

Our plan of operation for the Searchlight Gold
Project currently involves the following:

|(a) | Continue metallurgical testing on small and bulk samples
      taken from the Searchlight Gold Project area; and
|--- | ----------------------------------------------------------------------------------------------------------------
|    |                                                                                                                 
|(b) | Conduct drilling and pre-feasibility program for the
      Searchlight Gold Project.                            

Current metallurgical testing for the Searchlight
Gold Project will focus on optimizing the recovery of gold during the
metallurgical process. During the fourth fiscal quarter of 2007, we intend to
continue conducting microwave digestion and autoclave testing on samples taken
from the project area, which is expected to provide additional metallurgical
data regarding the analytical protocols to be used on the project. In
conjunction with this testing, we will also continue to work on optimizing the
recovery of gold from solution as this is expected to be a key component in
determining the effectiveness of the overall metallurgical recovery process to
be used for the Searchlight Gold Project.

During the fourth fiscal quarter of 2007, we also
hope to finalize our plans with respect to the drilling and pre-feasibility
program that we intend to conduct for the Searchlight Gold Project. This program
is expected to include an 18 hole drilling program, chain-of-custody sampling
and assaying of drill hole materials, pilot plant tests and the commissioning of
an independent pre-feasibility report. We have been corresponding with the
Bureau of Land Management (the BLM) regarding the transfer of an approved plan
of operations for the drilling program. The plan of operations is currently
registered in the name of a vendor of the Searchlight Claims. The BLM has
indicated to us that they have some concerns about approving the transfer of the
plan of operation because of an outstanding debt owed to the BLM by one of our
former directors. We are currently working with the former director to resolve
these issues with the BLM as quickly as possible. Additional planned
metallurgical testing is expected to proceed as scheduled; however, if we are
unable to obtain a transfer of the plan of operations, our proposed drilling
program for the Searchlight Gold Project could be delayed.

Readers are cautioned that we have not yet
established any proven or probable mineral reserves on the Searchlight Gold
Project, and there are no assurances that we will be able to do so in the future
as we are still in the process of conducting our exploration program for the
Searchlight Gold Project.

Anticipated 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·
    Pilot Testing/Site
      Work
    $300,000·
    First Module of
      Production
      $3,500,000·
    Commence
      Construction of Full-Scale Processing Facility
    $15,000,000**$18,800,000**Searchlight Gold
      Project·
    Metallurgical
      Testing Program
    $400,000·
    Commence Drilling
      and Feasibility Program
    $300,000$700,000TOTAL
    $23,100,000


6

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We recorded a net loss of $2,230,810 for the nine
months ended September 30, 2007 and have an accumulated deficit of $11,759,190
since inception. As at September 30, 2007, we had cash reserves in the amount of
$8,833,969. This is less than the $23,100,000 that our management anticipates
spending on our exploration and development programs and the anticipated costs
associated with our continuing operations. Accordingly, we expect that we will
need to obtain additional financing in the near future. See Future Financings,
below.

RESULTS OF OPERATIONS

Restatements

We have restated certain items on our consolidated
balance sheets and statements of operations. On our consolidated balance sheets:
(i) mineral properties have been restated to include the market value of certain
shares issued by us under the terms of our option agreements for the mineral
claims making up the Searchlight Gold Project; and (ii) the Clarkdale Slag
Project has been restated to include deferred future income tax liability and
state income tax liability in connection with our acquisition of Transylvania
International, Inc. (TI). Our consolidated statement of operations for the
period from inception to December 31, 2006 has been restated to reclassify net
losses prior to January 1, 2005 as losses from discontinued operations. Our
consolidated statements of operations for the nine month period ended September
30, 2006 has been restated to reclassify foreign currency translation
adjustments as general and administrative expenses. Related to this issue, our
consolidated balance sheet for the period ended December 31, 2006 has been
restated to reclassify accumulated other comprehensive loss as accumulated
deficit during the exploration stage. A description of the restatements made to
our financial statements is provided at Note 15 to the consolidated financial
statements for the period ended September 30, 2007 included with this Quarterly
Report on Form 10-QSB.

Third Quarter and Nine Months
Summary

|                |   |                                  |  |   |                                | 
|--------------- | - | -------------------------------- |  | - | ------------------------------ | 
|                |   | Third Quarter Ended September 30 |  |   | Nine Months Ended September 30 | 
|                |   |                                  |  |   |                                | 
|                |   | 2007                             |  |   | 2006                           | 
|                |   |                                  |  |   |                                | 
|Revenue         | $ | 8,515                            |  |   | -                              | 
|                |   |                                  |  |   |                                | 
|Operating       |   | (796,946)                        |  |   | (875,181)                      | 
|Expenses        |   |                                  |  |   |                                | 
|                |   |                                  |  |   |                                | 
|Loss on         |   | -                                |  |   | -                              | 
|Equipment       |   |                                  |  |   |                                | 
|Disposition     |   |                                  |  |   |                                | 
|                |   |                                  |  |   |                                | 
|Interest and    |   | 94,580                           |  |   | 24,106                         | 
|Dividend Income |   |                                  |  |   |                                | 
|                |   |                                  |  |   |                                | 
|Net Loss        | $ | (693,851)                        |  | $ | (851,075)                      | 

Revenue

During the quarter ended September 30, 2007 we
received revenues of $8,515 from leases and rentals of our commercial buildings
and certain facilities acquired in connection with our acquisition of TI. 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 currently in the exploration stage of our
business, have not earned any revenues from our planned mineral operations to
date. We do not anticipate earning revenues from our planned mineral operations
until

7

---

such time as we enter into commercial production
of the Clarkdale Slag Project, the Searchlight Gold Project or other mineral
properties we may acquire from time to time, of which there are no
assurances.

Expenses

Our operating expenses for the quarters ended
September 30, 2007 and September 30, 2006 are outlined in the table
below:

|                                 |   |                                  |  |   |                                | 
|-------------------------------- | - | -------------------------------- |  | - | ------------------------------ | 
|                                 |   | Third Quarter Ended September 30 |  |   | Nine Months Ended September 30 | 
|                                 |   |                                  |  |   |                                | 
|                                 |   | 2007                             |  |   | 2006                           | 
|                                 |   |                                  |  |   |                                | 
|Mineral exploration and          | $ | 199,961                          |  | $ | 642,226                        | 
|evaluation                       |   |                                  |  |   |                                | 
|Mineral exploration and          |   | 90,000                           |  |   | -                              | 
|evaluation  related party       |   |                                  |  |   |                                | 
|General and
      administrative |   | 471,209                          |  |   | 231,304                        | 
|General and administrative       |   | 23,017                           |  |   | -                              | 
| related party                  |   |                                  |  |   |                                | 
|Depreciation                     |   | 11,710                           |  |   | 1,651                          | 
|Interest expense                 |   | 1,049                            |  |   | -                              | 
|Total Operating Expenses         | $ | 796,946                          |  | $ | 875,181                        | 

Our operating expenses for the nine months ended
September 30, 2007 decreased slightly compared to the comparative period in
2006. Our general and administrative expenses increased as a result of (i)
increased professional and administrative expenses associated with holding our
2007 annual meeting of stockholders, the acquisition of Transylvania
International, Inc., the completion of our equity financings and the preparation
of our Registration Statement on Form SB-2; (ii) increased management fees
related to the administration of the Clarkdale Slag Project site; and (iii)
increased compensation paid to our executive officers and our
directors.

Mineral exploration costs decreased as a result of
our focus on our construction efforts for the Clarkdale Slag Project during the
fiscal quarters ended June 30, 2007 and September 30, 2007.

Amounts paid to related parties for mineral
exploration and evaluation expenses during the period were paid to Nanominerals
Corp. (Nano) for technical assistance and financing related activities
provided by Nano in connection with the exploration and development of our
mineral projects. Ian R. McNeil, our Chief Executive Officer and President, and
Carl S. Ager, our Secretary and Treasurer, are each 17% shareholders of Nano.
Nano is also one of our significant shareholders. Amounts paid to related
parties for general and administrative expenses were paid to Cupit, Milligan,
Ogden & Williams, CPAs (CMOW) for accounting support services. Melvin L.
Williams, our Chief Financial Officer, is affiliated with CMOW.

Equity Compensation

Included in general and administrative expenses
for the three and nine month periods ended September 30, 2007 are compensation
expenses related to the granting of stock options of $1,312 and $144,415,
respectively. 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 September 30,
2007, 7,246 options have been granted under the 2007 Plan with an exercise price
of $3.45 per share. The options are fully vested and expire on June 15, 2009.
During the nine months ended September 30, 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.

8

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Liquidity and Financial
Condition

Working Capital

|                                                  |   | At September 30, 2007 |              |   | At December 31, 2006    |             |  | Percentage              | 
|------------------------------------------------- | - | --------------------- | ------------ | - | ----------------------- | ----------- |  | ----------------------- | 
|                                                  |   |                       |              |   | (restated)              |             |  | Increase / (Decrease)   | 
|Current Assets                                    | $ | 9,139,397             |              | $ | 3,790,483               |             |  | 141.1%                  | 
|Current Liabilities                               |   | (8,235,716)           |              |   | (1,583,306)             |             |  | 420.2%                  | 
|Working Capital                                   | $ | 903,681               |              | $ | 2,207,177               |             |  | (59.1)%                 | 
|                                                  |   |                       |              |   |                         |             |  |                         | 
|Cash Flows                                        |   |                       |              |   |                         |             |  |                         | 
|                                                  |   |                       |              |   | Nine Months
      Ended |             |  | Nine Months
      Ended | 
|                                                  |   |                       |              |   | September 30, 2007      |             |  | September 30, 2006      | 
|Cash Flows used in Operating
      Activities     |   | $                     | (2,601,921)  |   | $                       | (2,249,536) | 
|Cash Flows used in
      Investing Activities     |   |                       | (13,046,254) |   |                         | (25,291)    | 
|Cash Flows provided by Financing
      Activities |   |                       | 20,797,896   |   |                         | 6,256,376   | 
|Net Increase in Cash
      During Period          |   | $                     | 5,149,721    |   | $                       | 3,981,549   | 

Working Capital.The
decrease in our working capital surplus from $2,207,177 as at December 31, 2006
to $903,681 as at September 30, 2007 was primarily due to additional current
obligations related to our acquisition of Transylvania International, Inc.
(Transylvania) in February, 2007. As at September 30, 2007, our current
obligations in respect of the amounts payable to Transylvanias former
shareholder, Verde River Iron Company, in connection with the acquisition
totalled $6,990,000.

Property and Equipment.Property and equipment increased by $2,013,893 during the quarter ended
September 30, 2007. The increase was primarily due to site improvement and
equipment at the Clarkdale Slag Project.

Income Tax Liability.Included in long term liabilities in the accompanying restated consolidated
  financials statements is a balance of $41,184,686 for deferred tax liability
  relating to the Clarkdale Slag Project. A deferred income tax liability was
  recorded on the excess of fair market value for the asset acquired over income
  tax basis at a combined statutory federal and state rate of 38.6% with the corresponding
  increase in the purchase price allocation of the assets acquired. As of September
  30, 2007 and December 31, 2006, we had net operating loss carryforwards of approximately
  $6,821,800 and $4,764,549, respectively for federal income taxes. The net operating
  loss carryforwards expire between 2027 and 2025.

Future Financings

We recorded a net loss of $2,230,810 for the nine
months ended September 30, 2007 and have an accumulated deficit of $11,759,190
since inception. As at September 30, 2007 we had cash reserves in the amount of
$8,833,969. This is less than the $23,100,000 that our management anticipates
spending on our exploration and development programs and the anticipated costs
associated with our continuing operations. Accordingly, we expect that we will
need to obtain additional financing in the near future.

On October 4, 2007, we engaged DCM Structured
Finance Limited (DCMSF) of London, England, to advise and assist us on various
corporate finance matters, including advising and assisting us with respect to
seeking and obtaining financing for the Clarkdale Slag Project. However, we do
not, at this time, have any financing arrangements in place.

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

9

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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.

Principles of Consolidation

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

Mineral Rights

We capitalize 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. We capitalize acquisition and
option costs of mineral rights 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 we do not continue with exploration after the completion
of the feasibility study, the claims will be expensed at that time.

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). We periodically evaluate 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. We use an estimate of the related undiscounted cash flows
over the remaining life of the fixed assets in measuring their
recoverability.

10

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RISKS AND UNCERTAINTIES

Actual capital costs, operating costs,
production and economic returns may differ significantly from our estimates and
there are no assurances that any future development activities will result in
profitable mining operations.

We are an exploration stage company and are still
in the process of exploring and developing our mineral projects. We do not have
any historical mineral operations upon which to base our estimates of costs.
Decisions about the development of our mineral properties will ultimately be
based upon feasibility studies. Feasibility studies derive cost estimates based
primarily upon:

- anticipated tonnage, grades and metallurgical characteristics
  of the ore to be mined and processed;
- anticipated recovery rates of gold and other metals from the
  ore;
- cash operating costs of comparable facilities and equipment;
  and
- anticipated weather/climate conditions.

Capital and operating costs, production and
economic returns, and other estimates contained in our final feasibility
studies, may differ significantly from our current estimates. There is no
assurance that our actual capital and operating costs will not exceed our
current estimates. In addition, delays to construction schedules may negatively
impact the net present value and internal rates of return for our mineral
properties. There are no assurances that actual recoveries of base and precious
metals or other minerals processed from our mineral projects will be
economically feasible or that actual costs will match our pre-feasibility
estimates.

Feasibility estimates typically underestimate
future capital and operating costs. We are still developing our metallurgy
analysis and flow sheets for the Clarkdale Slag Project. If the results from our
feasibility studies on the Clarkdale Slag Project and the production results
from the operation of our first production 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.

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 on 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 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 Gold Project 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 Gold Project and
drilling and sampling activities on the Clarkdale Slag Project which will
require us to obtain additional financing. We recorded a net loss of $2,230,810
for the nine months ended September 30, 2007 and have an accumulated deficit of
$11,759,190 as at September 30, 2007. As at September 30, 2007, we had cash
reserves totaling $8,833,969. Over the next twelve months, our management
anticipates that the minimum cash requirements for funding our proposed
exploration program and our continued operations will be $23,100,000.
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.

11

---

Obtaining additional financing is 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.

If the results from our feasibility studies and
the production results from the operation of our first production module are not
sufficiently positive for us to proceed with the construction of our processing
facility we will have to scale back or abandon our proposed operations on the
Clarkdale Slag Project.

During the fourth fiscal quarter of 2007, we
intend to continue small scale pilot testing and site work for the Clarkdale
Slag Project and complete the installation of our first production module for
the project. Our first production module for the Clarkdale Slag Project will
consist of a full scale production and processing cycle. This first production
module is expected to become operational during the first fiscal quarter of 2008
and be used as a final test of the economic feasibility of the Clarkdale Slag
Project. If the operation of this first production module proves that the
Clarkdale Slag Project is economically feasible, we will seek to begin financing
the construction of additional production modules and our full scale processing
facility.

However, if the results of our pre-feasibility
studies on the Clarkdale Slag Project and the production results from the
operation of first production module are not positive, we will have to scale
back or abandon our proposed operations on the Clarkdale Slag Project. 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 condition will be adversely
affected.

If we are unable to achieve projected mineral
recoveries from our test mining activities at the Clarkdale Slag Project and
Searchlight Gold Project, then our financial condition will be adversely
affected.

As we have not established any reserves on either
our Clarkdale Slag Project or Searchlight Gold Project to date, there is no
assurance that actual recoveries of minerals from material mined during test
mining activities will equal or exceed our exploration costs on our mineral
properties. To date we have completed only a limited amount of drilling and
sampling on Clarkdale Slag Project site and the process testing of results has
been limited to small pilot plants and bench scale testing. There is no
assurance that if the Company moves to production scale from pilot plant scale
that the Companys production results will match pre-feasibility estimates. If
mineral recoveries are less than projected, then our sales of minerals will be
less than anticipated and may not equal or exceed the cost of exploration and
recovery in which case our operating results and financial condition will be
adversely affected.

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

12

---

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 Gold Project 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;                                                                                                                             
| |     |                                                                                                                                                                                                                             
| | (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 re-process minerals from
our Clarkdale Slag Project economically, then our financial condition and our
revenues will be adversely affected.

Until such time as we have established economic
feasibility of the Clarkdale Slag Project through our 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

13

---

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. 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
Gold Project, 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 will be subject to the laws of the
State of Nevada and applicable federal laws as we carry out our exploration
program on the Searchlight Gold Project. 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 operations changes in a manner that increases the
costs of compliance and reclamation, then our operating expenses may increase.
This would result adversely affect our financial condition and operating
results.

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 Gold Project,
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;

14

---

| | (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 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 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 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-

15

---

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 September 30, 2007 that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.

16

---

PART II - OTHER INFORMATION

|ITEM 1. | LEGAL PROCEEDINGS.
|------- | ------------------

None.

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

On November 13, 2007, we issued 6,134 shares of
our common stock to our non-management directors. These shares were issued
pursuant to the director compensation policy for our non-management directors
based on a price of $2.85 per share, being the closing price of our common stock
on September 28, 2007, being the last trading day of our previous fiscal
quarter. The shares were issued under Section 4(2) of the Securities
Act.

|ITEM 3. | DEFAULTS UPON SENIOR
      SECURITIES.
|------- | --------------------------------------

None.

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

None.

|ITEM 5. | OTHER INFORMATION.
|------- | ------------------

Non-Reliance on Previously Issued Financial
Statements

On November 8, 2007, after consulting with Brown
Armstrong Paulden McCown Starbuck Thornburgh & Keeter Accountancy
Corporation, our independent accountants, our management and our audit
committee, concluded that our audited financial statements for the year ended
December 31, 2006, and our unaudited interim financial statements for the
periods ended March 31, 2007 and June 30, 2007 should not be relied upon. Based
upon comments received from the SEC with respect to their review of our amended
Registration Statement on Form SB-2/A, our management and our audit committee
have concluded that the following restatements should be made to our
consolidated balance sheets and statements of operations:

|(a) | Amounts recorded for mineral properties on our
      consolidated balance sheets have been restated to include the market value
      of certain shares issued by us under the terms of our option agreements
      for the mineral claims making up the Searchlight Gold Project.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                   
|(b) | Amounts recorded for the Clarkdale Slag Project on our
      consolidated balance sheets have been restated to include deferred future
      income tax liability and state income tax liability in connection with our
      acquisition of Transylvania International, Inc.     
|    |                                                                                                                                                                                                                                                                                   
|(c) | Our consolidated statement of operations for the period
      from inception to December 31, 2006 has been restated to reclassify net
      losses prior to January 1, 2005 as losses from discontinued
      operations.                                                         
|    |                                                                                                                                                                                                                                                                                   
|(d) | Our consolidated statement of operations for the three
      and nine month periods ended September 30, 2006 have been restated to
      reclassify net losses prior to January 1, 2005 as losses from discontinued
      operations.                                             
|    |                                                                                                                                                                                                                                                                                   
|(e) | Our consolidated statements of operations for the nine
      month period ended September 30, 2006 have been restated to reclassify
      foreign currency translation adjustments as general and administrative
      expenses.                                                  

17

---

|(f) | A related restatement has been made to our consolidated
      balance sheet for the period ended December 31, 2006 to reclassify
      accumulated other comprehensive loss as accumulated deficit during the
      exploration stage.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We intend to file amendments to our Annual Report
on Form 10-KSB for the period ended December 31, 2006 and our Quarterly Reports
on Form 10-QSB for the periods ended March 31, 2007 and June 30, 2007 to include
the above restated financial statements.

|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)                                                       
|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)                                                                                                                                        

18

---

|Exhibit |                                                                                                                                                                                                                                                   
|------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of
      Exhibits                                                                                                                                                                                                                     
|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)                                                                                                                             
|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.(32)                                                                                                                               
|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)                                               

19

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|Exhibit |                                                                                                                                                    
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of
      Exhibits                                                                                                                      
|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.(32)                  
|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)                                                                                                                  
|10.49   | Engagement Letter from DCM
      Structure Finance Limited to Searchlight Minerals Corp.(33)                                                       
|14.1    | Code of Ethics.(21)                                                                                                                                
|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    | Audit Committee
      Charter.(21)                                                                                                                 
|99.2    | 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.                      

20

---

|(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.                     
|(32) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on June 20, 2006.                    
|(33) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on October 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: | November 14, 2007 |  | By: | /s/ Ian R. McNeil                          
|      |                   |  |     | IAN R. McNEIL                              
|      |                   |  |     | President and Chief Executive
      Officer
|      |                   |  |     | (Principal Executive Officer
      )       
|      |                   |  |     |                                            
|      |                   |  |     |                                            
|      |                   |  |     |                                            
|      |                   |  |     |                                            
|Date: | November 14, 2007 |  | By: | /s/ Melvin L. Williams                     
|      |                   |  |     | MELVIN L. WILLIAMS                         
|      |                   |  |     | Chief Financial Officer                    
|      |                   |  |     | (Principal Financial Officer
      )       

---