---



CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED 
  DECEMBER 31,
2010 AND 2009

(Expressed in Canadian Dollars, unless otherwise
stated)

1

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Managements Report on Internal Control over Financial
Reporting

The management of Great Basin Gold Ltd. is responsible for
establishing and maintaining adequate internal control over financial reporting.
The United States Securities and Exchange Act of 1934 Rule 13a-15(f) and
15d-15(f) define this as a process designed by, or under the supervision of, the
Companys principal executive and principal financial officers and effected by
the Companys Board of Directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles and includes those policies and
procedures that:

- Pertain to the maintenance of records that, in reasonable detail,
  accurately and fairly reflect the transactions and dispositions of the assets
  of the Company;
- Provide reasonable assurance that transactions are recorded as necessary
  to permit preparation of financial statements in accordance with generally
  accepted accounting principles, and that receipts and expenditures of the
  Company are being made only in accordance with authorizations of management
  and directors of the Company; and
- Provide reasonable assurance regarding prevention or timely detection of
  unauthorized acquisition, use or disposition of the Companys assets that may
  have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial
  reporting may not prevent or detect misstatements. Also, projections of any
  evaluation of effectiveness of internal control over financial reporting to
  future periods are subject to risk that controls may become inadequate because
  of changes in conditions, or that the degree of compliance with the policies
  or procedures may deteriorate.

Management assessed the effectiveness of the Companys internal
  control over financial reporting as of December 31, 2010. In making this assessment,
  the Companys management used the criteria, established in Internal Control-Integrated
  Framework issued by the Committee of Sponsoring Organizations of the Treadway
  Commission (COSO).

Based upon this assessment, management concluded that the
Companys internal control over financial reporting was effective as of December
31, 2010.

The effectiveness of the Companys internal control over
financial reporting as at December 31, 2010 has been audited by
PricewaterhouseCoopers LLP, our independent auditors, as stated in their report
which appears herein.

|/s/ Ferdinand
      Dippenaar |  | /s/ Lourens
      A. van Vuuren | 
|----------------------------- |  | ------------------------------- | 
|Chief Executive Officer       |  | Chief Financial Officer         | 

Vancouver, British Columbia

March 15, 2011

2

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| |  |                             
| |  | ----------------------------
| |  |                             
| |  | PricewaterhouseCoopers LLP  
| |  | Chartered Accountants       
| |  | PricewaterhouseCoopers Place
| |  | 250 Howe Street, Suite 700  
| |  | Vancouver, British Columbia 
| |  | Canada V6C 3S7              
| |  | Telephone +1 604 806 7000   
| |  | Facsimile +1 604 806 7806   

INDEPENDENT AUDITORS REPORT

To the Shareholders of Great Basin Gold Ltd.

We have completed integrated audits of Great Basin Gold Ltd.s
2010 and 2009 consolidated financial statements and its internal control over
financial reporting as at December 31, 2010. Our opinions, based on our audits,
are presented below.

Report on the consolidated financial statements

We have audited the accompanying consolidated financial
statements of Great Basin Gold Ltd. which comprise the consolidated balance
sheets as at December 31, 2010 and 2009, and the consolidated statements of
operations and comprehensive loss, shareholders equity and deficit and cash
flows for the years then ended, and the related notes including a summary of
significant accounting policies.

Managements responsibility for the consolidated financial
statements

Management is responsible for the preparation and fair
presentation of these consolidated financial statements in accordance with
Canadian generally accepted accounting principles and for such internal control
as management determines is necessary to enable the preparation of consolidated
financial statements that are free from material misstatement, whether due to
fraud or error.

Auditors responsibility

Our responsibility is to express an opinion on these
consolidated financial statements based on our audits. We conducted our audits
in accordance with Canadian generally accepted auditing standards and the
standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform an audit to obtain reasonable
assurance about whether the consolidated financial statements are free from
material misstatement. Canadian generally accepted auditing standards also
require that we comply with ethical requirements.

An audit involves performing procedures to obtain audit
evidence, on a test basis, about the amounts and disclosures in the consolidated
financial statements. The procedures selected depend on the auditors judgment,
including the assessment of the risks of material misstatement of the
consolidated financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers internal control relevant to the
companys preparation and fair presentation of the consolidated financial
statements in order to design audit procedures that are appropriate in the
circumstances. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by
management, as well as evaluating the overall presentation of the consolidated
financial statements.

We believe that the audit evidence we have obtained in our
audits is sufficient and appropriate to provide a basis for our audit opinion on
the consolidated financial statements.

PricewaterhouseCoopers refers to
PricewaterhouseCoopers LLP, an Ontario limited liability partnership, or, as the
context requires, the PricewaterhouseCoopers global network or other member
firms of the network, each of which is a separate legal entity.

---

| |  | 
| |  | 

Opinion

In our opinion, the consolidated financial statements present
fairly, in all material respects, the financial position of Great Basin Gold
Ltd. as at December 31, 2010 and 2009 and the results of its operations and cash
flows for the years then ended in accordance with Canadian generally accepted
accounting principles.

Report on internal control over financial reporting

We have also audited Great Basin Gold Ltd.s internal control
over financial reporting as at December 31, 2010, based on criteria established
in Internal Control - Integrated Framework, issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO).

Managements responsibility for internal control over
financial reporting

Management is responsible for maintaining effective internal
control over financial reporting and for its assessment of the effectiveness of
internal control over financial reporting, included in the accompanying
Managements Report on Internal Control over Financial Reporting.

Auditors responsibility

Our responsibility is to express an opinion on the companys
internal control over financial reporting based on our audit. We conducted our
audit of internal control over financial reporting in accordance with the
standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial reporting was
maintained in all material respects.

An audit of internal control over financial reporting includes
obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, testing and evaluating the
design and operating effectiveness of internal control based on the assessed
risk, and performing such other procedures as we consider necessary in the
circumstances.

We believe that our audit provides a reasonable basis for our
opinion on the companys internal control over financial reporting.

Definition of internal control over financial
reporting

A companys internal control over financial reporting is a
process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. A
companys internal control over financial reporting includes those policies and
procedures that (i) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the
assets of the company; (ii) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with Canadian generally accepted accounting principles, and that
receipts and expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (iii) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the companys assets that could have a
material effect on the financial statements.

PricewaterhouseCoopers refers to
PricewaterhouseCoopers LLP, an Ontario limited liability partnership, or, as the
context requires, the PricewaterhouseCoopers global network or other member
firms of the network, each of which is a separate legal entity.

---

| |  | 
| |  | 

Inherent limitations

Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions or that the
degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, Great Basin Gold Ltd. maintained, in all
material respects, effective internal control over financial reporting as at
December 31, 2010 based on criteria established in Internal Control -Integrated
Framework issued by COSO.

/s/ PricewaterhouseCoopers LLP

Chartered Accountants

Vancouver, BC

March 15, 2011

PricewaterhouseCoopers refers to
PricewaterhouseCoopers LLP, an Ontario limited liability partnership, or, as the
context requires, the PricewaterhouseCoopers global network or other member
firms of the network, each of which is a separate legal entity.

---

GREAT BASIN GOLD LTD. 
  Consolidated Balance Sheets

|                                                 |  |       |  |   | December
      31 |   |   | December
      31 |  
|------------------------------------------------ |  | ----- |  | - | ----------------- | - | - | ----------------- | -
|                                                 |  | Note  |  |   | 2010              |   |   | 2009              |  
|                                                 |  |       |  |   | $ '000            |   |   | $ '000            |  
|Assets                                           |  |       |  |   |                   |   |   |                   |  
|                                                 |  |       |  |   |                   |   |   |                   |  
|Current assets                                   |  |       |  |   |                   |   |   |                   |  
|Cash and cash equivalents                        |  | 5     |  | $ | 12,855            |   | $ | 89,464            |  
|Amounts receivable                               |  | 6     |  |   | 9,340             |   |   | 5,053             |  
|Inventory                                        |  | 7     |  |   | 18,440            |   |   | 26,312            |  
|Available-for-sale financial instruments         |  | 8     |  |   |                  |   |   | 4,961             |  
|Held-for-trading financial
      instruments     |  | 9     |  |   |                  |   |   | 207               |  
|Other assets                                     |  |       |  |   | 1,283             |   |   | 865               |  
|                                                 |  |       |  |   | 41,918            |   |   | 126,862           |  
|Loans due from related parties                   |  | 10(a) |  |   | 13,372            |   |   |                  |  
|Property, plant and equipment                    |  | 11    |  |   | 512,384           |   |   | 191,474           |  
|Reclamation deposits                             |  | 12    |  |   | 4,719             |   |   | 4,590             |  
|Restricted cash                                  |  | 13    |  |   |                  |   |   | 2,439             |  
|Mineral
      property interests                 |  | 14    |  |   | 245,650           |   |   | 222,919           |  
|Total Assets                                     |  |       |  | $ | 818,043           |   | $ | 548,284           |  
|                                                 |  |       |  |   |                   |   |   |                   |  
|Liabilities and Shareholders' Equity             |  |       |  |   |                   |   |   |                   |  
|                                                 |  |       |  |   |                   |   |   |                   |  
|Current liabilities                              |  |       |  |   |                   |   |   |                   |  
|Accounts payable and accrued liabilities         |  | 15    |  | $ | 61,732            |   | $ | 29,206            |  
|Current portion of long term
      borrowings    |  | 16    |  |   | 53,516            |   |   | 43,768            |  
|Current
      portion of other liabilities       |  | 18    |  |   | 278               |   |   |                  |  
|                                                 |  |       |  |   | 115,526           |   |   | 72,974            |  
|                                                 |  |       |  |   |                   |   |   |                   |  
|Long term borrowings                             |  | 16    |  |   | 156,062           |   |   | 86,948            |  
|Future income taxes                              |  | 17    |  |   | 18,939            |   |   | 10,659            |  
|Other liabilities                                |  | 18    |  |   | 12,419            |   |   |                  |  
|Site
      reclamation obligations               |  | 19    |  |   | 5,660             |   |   | 3,990             |  
|                                                 |  |       |  |   | 193,080           |   |   | 101,597           |  
|Shareholders' equity                             |  |       |  |   |                   |   |   |                   |  
|Share capital                                    |  |       |  |   | 709,449           |   |   | 567,596           |  
|Warrants                                         |  |       |  |   | 6,108             |   |   | 13,104            |  
|Contributed surplus                              |  |       |  |   | 86,540            |   |   | 83,267            |  
|Deficit                                          |  |       |  |   | (294,625          | ) |   | (265,713          | )
|Accumulated other comprehensive income (loss)    |  |       |  |   | 1,965             |   |   | (24,541           | )
|                                                 |  |       |  |   | 509,437           |   |   | 373,713           |  
|                                                 |  |       |  |   |                   |   |   |                   |  
|Total
      Liabilities and Shareholders' Equity |  |       |  | $ | 818,043           |   | $ | 548,284           |  

|                   |  |    |  |  |  |  |  |  | 
|------------------ |  | -- |  |  |  |  |  |  | 
|Segment disclosure |  | 23 |  |  |  |  |  |  | 
|Subsequent events  |  | 24 |  |  |  |  |  |  | 

See accompanying notes to consolidated financial statements.

Approved by the Board of Directors

|/s/ Ferdinand Dippenaar | /s/ Ronald W. Thiessen
|----------------------- | ----------------------
|                        |                       
|Ferdinand Dippenaar     | Ronald W. Thiessen    
|                        |                       
|Chief Executive Officer | Director              

6

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GREAT BASIN GOLD LTD.Consolidated Statements of
Operations and Comprehensive Loss

|                                                                                                   |  |       |  |   | Year
      ended |   |   | Year
      ended |  
|-------------------------------------------------------------------------------------------------- |  | ----- |  | - | ---------------- | - | - | ---------------- | -
|                                                                                                   |  |       |  |   | December 31      |   |   | December 31      |  
|                                                                                                   |  | Note  |  |   | 2010             |   |   | 2009             |  
|                                                                                                   |  |       |  |   | $ '000           |   |   | $ '000           |  
|                                                                                                   |  |       |  |   |                  |   |   |                  |  
|Revenue                                                                                            |  |       |  | $ | 99,706           |   | $ | 33,738           |  
|(Expenses) income                                                                                  |  |       |  |   |                  |   |   |                  |  
|Production cost                                                                                    |  |       |  |   | (70,326          | ) |   | (20,615          | )
|Depletion charge                                                                                   |  |       |  |   | (8,444           | ) |   | (3,262           | )
|Exploration expenses                                                                               |  |       |  |   | (10,450          | ) |   | (16,592          | )
|Pre-development expenses                                                                           |  |       |  |   | (13,397          | ) |   | (25,869          | )
|Corporate and administrative
      cost                                                            |  |       |  |   | (7,630           | ) |   | (7,501           | )
|Corporate social responsibility                                                                    |  |       |  |   |                 |   |   | (1,084           | )
|Environmental impact
      study                                                                   |  |       |  |   | (2,580           | ) |   | (982             | )
|Foreign exchange gain - net                                                                        |  |       |  |   | 4,641            |   |   | 2,549            |  
|Salaries and compensation                                                                          |  |       |  |   |                  |   |   |                  |  
|Salaries and wages                                                                                 |  |       |  |   | (7,528           | ) |   | (6,628           | )
|Stock-based compensation                                                                           |  | 20(b) |  |   | (4,887           | ) |   | (8,284           | )
|Loss before the undernoted and income taxes                                                        |  |       |  |   | (20,895          | ) |   | (54,530          | )
|Interest expense                                                                                   |  |       |  |   | (64              | ) |   | (144             | )
|Interest income                                                                                    |  |       |  |   | 1,827            |   |   | 2,911            |  
|Net realized gain on available-for-sale
      financial instruments                                |  | 8     |  |   | 489              |   |   |                 |  
|Net realized loss on held-for-trading
      financial instruments                                  |  | 9     |  |   | (67              | ) |   |                 |  
|Net unrealized gain (loss) on held-for-trading
      financial instruments                         |  |       |  |   | 86               |   |   | (2,215           | )
|Net unrealized loss on held-for-trading
      financial instruments recognized                     |  | 18(b) |  |   | (3,606           | ) |   |                 |  
|Net
      unrealized market-to-market adjustments on held-for-trading financial instruments        |  | 18(b) |  |   | (6,860           | ) |   |                 |  
|Loss before income taxes                                                                           |  |       |  |   | (29,090          | ) |   | (53,978          | )
|Taxes recovered (paid)                                                                             |  | 17    |  |   | 9                |   |   | (8               | )
|Future
      income tax recovery                                                                   |  | 17    |  |   | 169              |   |   | 5,540            |  
|Loss
      for the year                                                                            |  |       |  | $ | (28,912          | ) | $ | (48,446          | )
|                                                                                                   |  |       |  |   |                  |   |   |                  |  
|Other comprehensive income (loss)                                                                  |  |       |  |   |                  |   |   |                  |  
|Unrealized gain on available-for-sale
      financial instruments                                  |  | 8     |  |   | 603              |   |   | 3,026            |  
|Realized gain on available-for-sale financial
      instruments upon transfer                      |  | 8     |  |   | (1,530           | ) |   |                 |  
|Unrealized
      gain (loss) on foreign exchange translation of self-sustaining foreign operations |  |       |  |   | 27,433           |   |   | (27,780          | )
|Other
      comprehensive income (loss)                                                            |  |       |  | $ | 26,506           |   | $ | (24,754          | )
|                                                                                                   |  |       |  |   |                  |   |   |                  |  
|Total
      comprehensive loss for the year                                                        |  |       |  | $ | (2,406           | ) | $ | (73,200          | )
|                                                                                                   |  |       |  |   |                  |   |   |                  |  
|                                                                                                   |  |       |  |   |                  |   |   |                  |  
|Basic
      and diluted loss per share                                                             |  |       |  | $ | (0.08            | ) | $ | (0.16            | )
|                                                                                                   |  |       |  |   |                  |   |   |                  |  
|Weighted
      average number of common shares outstanding (thousands)                             |  |       |  |   | 358,711          |   |   | 310,068          |  

See accompanying notes to consolidated financial
statements.

7

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GREAT BASIN GOLD LTD.Consolidated Statements of
Shareholders' Equity and Deficit

|                                                                                                         |  |       |  |  |                   |   |   | Year ended        |   |  |             |   |   | Year ended |  
|-------------------------------------------------------------------------------------------------------- |  | ----- |  |  | ----------------- | - | - | ----------------- | - |  | ----------- | - | - | ---------- | -
|                                                                                                         |  | Note  |  |  | December 31, 2010 |   |   | December 31, 2009 |  
|                                                                                                         |  |       |  |  |                   |   |   | $ '000            |   |  |             |   |   | $ '000     |  
|                                                                                                         |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|                                                                                                         |  |       |  |  | Number of         |   |   |                   |   |  | Number of   |   |   |            |  
|Common shares                                                                                            |  |       |  |  | shares            |   |   |                   |   |  | shares      |   |   |            |  
|                                                                                                         |  |       |  |  | (thousands)       |   |   |                   |   |  | (thousands) |   |   |            |  
|Balance, beginning of the
      year                                                                     |  |       |  |  | 334,158           |   | $ | 567,596           |   |  | 215,167     |   | $ | 428,657    |  
|Equity line: shares issued for cash,
      net of share issue costs                                      |  |       |  |  | -                 |   |   | -                 |   |  | 2,847       |   |   | 3,911      |  
|Public offering: shares
      issued for cash, net of share issue costs                                  |  |       |  |  | -                 |   |   | -                 |   |  | 115,000     |   |   | 132,700    |  
|Share purchase options exercised                                                                         |  | 20(b) |  |  | 6,085             |   |   | 14,308            |   |  | 1,124       |   |   | 2,293      |  
|Share purchase warrants
      exercised                                                                  |  | 20(c) |  |  | 59,504            |   |   | 100,290           |   |  | -           |   |   | -          |  
|Shares issued for early settlement of
      senior secured notes                                         |  | 20(f) |  |  | 2,234             |   |   | 3,910             |   |  | -           |   |   | -          |  
|Shares issued for
      settlement of senior secured notes                                               |  | 20(g) |  |  | 1,461             |   |   | 4,102             |   |  | -           |   |   | -          |  
|Shares issued on settlement of Rusaf
      contingent payment requirement                                |  | 20(e) |  |  | 10,573            |   |   | 19,243            |   |  | -           |   |   | -          |  
|Shares issued for mineral properties                                                                     |  |       |  |  | -                 |   |   | -                 |   |  | 20          |   |   | 35         |  
|Balance, end of year                                                                                     |  |       |  |  | 414,015           |   | $ | 709,449           |   |  | 334,158     |   | $ | 567,596    |  
|                                                                                                         |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|                                                                                                         |  |       |  |  | Number of         |   |   |                   |   |  | Number of   |   |   |            |  
|Share purchase warrants                                                                                  |  |       |  |  | warrants          |   |   |                   |   |  | warrants    |   |   |            |  
|                                                                                                         |  |       |  |  | (thousands)       |   |   |                   |   |  | (thousands) |   |   |            |  
|Balance, beginning of the
      year                                                                     |  |       |  |  | 86,178            |   | $ | 13,104            |   |  | 49,180      |   | $ | 24,006     |  
|Warrants issued pursuant to senior secured notes                                                         |  |       |  |  | -                 |   |   | -                 |   |  | 8,248       |   |   | -          |  
|Warrants issued
      pursuant to public offering, net of share issue costs                              |  |       |  |  | -                 |   |   | -                 |   |  | 57,500      |   |   | 5,308      |  
|Exercised, credited to share capital                                                                     |  | 20(c) |  |  | (59,504           | ) |   | (5,811            | ) |  | -           |   |   | -          |  
|Expired                                                                                                  |  | 20(c) |  |  | (1,756            | ) |   | (1,185            | ) |  | (28,750     | ) |   | (16,210    | )
|Balance, end of year                                                                                     |  |       |  |  | 24,918            |   | $ | 6,108             |   |  | 86,178      |   | $ | 13,104     |  
|                                                                                                         |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|Contributed surplus                                                                                      |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|Balance, beginning of the
      year                                                                     |  |       |  |  |                   |   | $ | 83,267            |   |  |             |   | $ | 21,600     |  
|Stock-based compensation                                                                                 |  | 20(b) |  |  |                   |   |   | 7,469             |   |  |             |   |   | 12,104     |  
|Share purchase options
      exercised, credited to share capital                                        |  |       |  |  |                   |   |   | (5,212            | ) |  |             |   |   | (808       | )
|Fair value of share purchase warrants
      expired                                                      |  |       |  |  |                   |   |   | 1,185             |   |  |             |   |   | 16,210     |  
|Future income tax on
      expired share purchase warrants                                               |  |       |  |  |                   |   |   | (169              | ) |  |             |   |   | (1,294     | )
|Convertible bond equity component                                                                        |  |       |  |  |                   |   |   | -                 |   |  |             |   |   | 35,455     |  
|Balance, end of year                                                                                     |  |       |  |  |                   |   | $ | 86,540            |   |  |             |   | $ | 83,267     |  
|                                                                                                         |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|Deficit                                                                                                  |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|Balance, beginning of the year                                                                           |  |       |  |  |                   |   | $ | (265,713          | ) |  |             |   | $ | (217,267   | )
|Net loss for the year                                                                                    |  |       |  |  |                   |   |   | (28,912           | ) |  |             |   |   | (48,446    | )
|Balance, end of year                                                                                     |  |       |  |  |                   |   | $ | (294,625          | ) |  |             |   | $ | (265,713   | )
|                                                                                                         |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|Accumulated other comprehensive (loss)
      income                                                      |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|Balance, beginning of the
      year                                                                     |  |       |  |  |                   |   | $ | (24,541           | ) |  |             |   | $ | 213        |  
|Unrealized gain on available-for-sale
      financial instruments                                        |  |       |  |  |                   |   |   | 603               |   |  |             |   |   | 3,026      |  
|Realized gain on
      available-for-sale financial instruments upon transfer                            |  |       |  |  |                   |   |   | (1,530            | ) |  |             |   |   | -          |  
|Accumulated unrealized gain on foreign exchange
      translation of self- sustaining foreign operations |  |       |  |  |                   |   |   | 27,433            |   |  |             |   |   | (27,780    | )
|Balance, end of year                                                                                     |  |       |  |  |                   |   | $ | 1,965             |   |  |             |   | $ | (24,541    | )
|                                                                                                         |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|Total accumulated comprehensive loss and deficit, end of
      year                                      |  |       |  |  |                   |   |   | (292,660          | ) |  |             |   |   | (290,254   | )
|                                                                                                         |  |       |  |  |                   |   |   |                   |   |  |             |   |   |            |  
|TOTAL SHAREHOLDERS' EQUITY                                                                               |  |       |  |  |                   |   | $ | 509,437           |   |  |             |   | $ | 373,713    |  

See accompanying notes to consolidated financial
statements.

8

---

GREAT BASIN GOLD LTD. Consolidated Statements of Cash
Flows

|                                                                                      |   | Year ended  |   |   | Year ended  |  
|------------------------------------------------------------------------------------- | - | ----------- | - | - | ----------- | -
|                                                                                      |   | December 31 |   |   | December 31 |  
|                                                                                      |   | 2010        |   |   | 2009        |  
|                                                                                      |   | $ '000      |   |   | $ '000      |  
|Operating activities                                                                  |   |             |   |   |             |  
|Loss for the year                                                                     | $ | (28,912     | ) | $ | (48,446     | )
|Items not involving cash                                                              |   |             |   |   |             |  
|Production non-cash charges                                                           |   | 4,213       |   |   | 1,034       |  
|Pre-development non-cash charges                                                      |   | 1,077       |   |   | 2,791       |  
|Exploration non-cash charges                                                          |   | 291         |   |   | 313         |  
|Depreciation                                                                          |   | 226         |   |   | 152         |  
|Future income tax recovery                                                            |   | (169        | ) |   | (5,540      | )
|Loss on sale of assets                                                                |   |            |   |   | 15          |  
|Net realized gain on
      available-for-sale financial instruments                   |   | (489        | ) |   |            |  
|Net realized loss on held-for-trading
      financial instruments                     |   | 67          |   |   |            |  
|Unrealized (gain) loss on
      held-for-trading financial instruments                |   | (86         | ) |   | 2,215       |  
|Unrealized loss on held-for-trading financial
      instruments recognized            |   | 3,606       |   |   |            |  
|Unrealized mark-to-market
      adjustments on held-for-trading financial instruments |   | 6,860       |   |   |            |  
|Mineral properties written off                                                        |   |            |   |   | 154         |  
|Non-cash stock-based
      compensation expense                                       |   | 4,887       |   |   | 8,284       |  
|Unrealized foreign exchange gain                                                      |   | (6,613      | ) |   | (3,953      | )
|Depletion                                                                             |   | 8,444       |   |   | 3,179       |  
|Interest expense accrual                                                              |   | 64          |   |   | 120         |  
|Interest income accrual                                                               |   | (227        | ) |   | (519        | )
|Changes in non-cash operating working capital                                         |   |             |   |   |             |  
|Amounts receivable                                                                    |   | (5,200      | ) |   | (881        | )
|Prepaid expenses                                                                      |   | (408        | ) |   | 27          |  
|Inventory                                                                             |   | 6,812       |   |   | (14,846     | )
|Accounts payable and accrued liabilities                                              |   | 4,432       |   |   | 651         |  
|Cash used in operating activities                                                     |   | (1,125      | ) |   | (55,250     | )
|                                                                                      |   |             |   |   |             |  
|Investing activities                                                                  |   |             |   |   |             |  
|Mineral property acquisition costs                                                    |   | (51         | ) |   | (61         | )
|Net proceeds on sale of financial
      instruments                                   |   | 3,527       |   |   |            |  
|Proceeds on sale of assets                                                            |   |            |   |   | 64          |  
|Additions to property, plant and equipment                                            |   | (229,478    | ) |   | (118,187    | )
|Net additions to restricted cash                                                      |   | (6,204      | ) |   |            |  
|Additional amount advanced under loan
      agreement                                 |   | (1,072      | ) |   |            |  
|Reclamation
      deposits                                                            |   | (62         | ) |   | (1,795      | )
|Cash used in investing activities                                                     |   | (233,340    | ) |   | (119,979    | )
|                                                                                      |   |             |   |   |             |  
|Financing activities                                                                  |   |             |   |   |             |  
|Common shares and warrants issued for cash, net of issue
      costs                  |   | 103,500     |   |   | 143,403     |  
|Net proceeds received from long term
      borrowings                                 |   | 72,478      |   |   | 119,906     |  
|Repayment of long term borrowings                                                     |   | (2,242      | ) |   | (33,884     | )
|Payment of interest on convertible
      debentures                                   |   | (10,513     | ) |   |            |  
|Early settlement of 6,925 senior secured notes                                        |   | (4,569      | ) |   |            |  
|Advances to related parties                                                           |   |            |   |   | (230        | )
|Cash generated
      from financing activities                                        |   | 158,654     |   |   | 229,195     |  
|                                                                                      |   |             |   |   |             |  
|(Decrease) increase in cash and cash equivalents                                      |   | (75,811     | ) |   | 53,966      |  
|Cash and cash equivalents, beginning of
      year                                    |   | 89,464      |   |   | 33,549      |  
|Foreign exchange
      movement on cash and cash equivalents                          |   | (798        | ) |   | 1,949       |  
|Cash and cash
      equivalents, end of year                                          | $ | 12,855      |   | $ | 89,464      |  

Refer to note 21 of the Notes to the Consolidated Financial
Statements for supplementary information to the cash flow statement.

9

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|1. | Nature of operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Great Basin Gold Ltd. (Great Basin or the Company) is
      incorporated under the laws of the Province of British Columbia and is a
      mineral exploration and development company that is currently focused on
      delivering two advanced stage projects: the Hollister Project on the
      Carlin Trend in Nevada, USA and the Burnstone Project in the Witwatersrand
      Goldfields in South Africa. The Company, currently recognized as an
      emerging producer, will migrate to the rank of a junior gold producer as
      production from these two projects increase during 2011 and 2012. Over and
      above the exploration being conducted at the above mentioned properties,
      greenfields exploration is being undertaken in Tanzania and
    Mozambique.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2. | Basis of preparation and principles of
      consolidation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | These consolidated financial statements (financial
      statements) have been prepared in accordance with Canadian Generally
      Accepted Accounting Principles (Canadian GAAP), which, as described in
      note 25, differ in certain respects from accounting principles generally
      accepted in the United States of America.                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The principal accounting policies applied in the
      preparation of these financial statements are set out below. These
      policies have been consistently applied in all years presented, unless
      otherwise stated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | These financial statements include the accounts of the
      Company and its wholly-owned subsidiaries. All significant intercompany
      balances and transactions have been eliminated. Subsidiaries: are those entities in which the Company has an interest of
      more than one half of the voting rights or otherwise has power to govern
      the financial and operating policies. Subsidiaries are consolidated from
      the date on which control is acquired and are no longer consolidated when
      control ceases.                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The purchase method of accounting is
      used to account for the acquisition of subsidiaries. The cost of an
      acquisition is measured as the fair value of the assets given up, shares
      issued or liabilities undertaken at the date of acquisition plus costs
      directly attributable to the acquisition. Identifiable assets acquired and
      liabilities and contingent liabilities assumed in a business combination
      are measured initially at their fair values at acquisition
    date.                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The excess of the cost of acquisition
      over the fair value of the Companys share of the identifiable net assets
      acquired is recorded as goodwill.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3. | Significant accounting policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (a) Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Cash and cash equivalents consist of cash and highly
      liquid investments, having maturity dates of three months or less from the
      date of acquisition, that are readily convertible to known amounts of
      cash.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

10

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

(b) Amounts receivable

Amounts receivable
are recognized initially at fair value and subsequently measured at amortised
cost using the effective interest method, less provision for impairment. A
provision for impairment of receivables is established when there is objective
evidence that the Company will not be able to collect all amounts due, according
to the original terms of receivables.

The amount of the
provision is the difference between the assets carrying amount and the present
value of estimated future cash flows, discounted at the effective interest rate.
The amount of the provision is recognized in profit or loss.

(c) Inventory

Inventories, which include work in
progress, unprocessed ore and stores and materials, are measured at the lower of
cost and net realizable value. Net realizable value is the estimated selling
price in the ordinary course of business less the estimated cost of completion
and the estimated cost necessary to perform the sale. Work in progress consists
of precious metals in production and unrefined precious metals, which are valued
at the average production costs plus allocated overhead expenses. Unprocessed
ore consists of surface stockpiles and is valued at the average production costs
plus allocated overhead expenses. Stores and materials consist of consumables
and are valued at the weighted average cost.

(d) Property, plant and
equipment

Property, plant and equipment are
stated at cost less accumulated amortization.

Capitalized mine development costs
include expenditures incurred to develop new orebodies, following the receipt of
all necessary permits and licenses to permit commercial mining activities. Mine
development costs are capitalized to the extent they provide access to gold
bearing deposits and have future economic benefit.

Depreciation, depletion and
amortization of mine development costs are computed by the units-of-production
method based on estimated proven and probable mineral reserves. Proven and
probable mineral reserves reflect estimated quantities of economically
recoverable reserves which can be recovered in the future from known mineral
deposits. These reserves are amortized from the date on which mining begins.

Amortization of equipment used directly
on exploration projects is included in exploration expenses.

Other assets are depreciated over their
estimated useful lives on a straight line basis and have been calculated as
follows:

| | Buildings, including fixtures and
      improvements | 10 years   
| | ---------------------------------------------------- | -----------
| | Site equipment                                       | 3  7 years
| | Leased assets                                        | 3  7 years
| | Vehicles                                             | 3  7 years
| | Computers                                            | 3 years    
| | Office furniture and fixtures                        | 5 years    

11

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

(d) Property, plant and equipment
(continued)

Land and assets under construction are
not depreciated.

Borrowing costs are allocated to the
construction of any qualifying asset and are capitalized during the period of
time that is required to complete and prepare the asset for its intended use.

(e) Mineral property
interests

The Company capitalizes mineral property
  acquisition costs on a property-by-property basis. Mineral property acquisition
  costs are subject to impairment tests for long lived assets.

Exploration expenditures are charged
  to profit or loss as incurred.

Pre-development costs incurred prior
  to a development decision and the receipt of all necessary permits and licenses
  for commercial mining operations are charged to profit or loss as incurred.

Development expenditures incurred subsequent
  to the commencement of commercial production to increase productive capacity
  or to extend the life of existing production are capitalized under mine development
  costs.

Mineral property acquisition costs
include the cash consideration and the fair market value of common shares issued
for mineral property interests, based on the trading price of the shares at the
time the acquisition is closed. Payments relating to a property acquired under
an option or joint venture agreement, where such payments are made at the sole
discretion of the Company, are recorded in the accounts upon payment.

Administrative expenditures are
expensed as incurred.

(f) Impairment of non-financial
assets

Long-lived assets are reviewed for impairment
  whenever events or changes in circumstances indicate that the carrying amount
  may not be recoverable. The recoverable amount is determined on the basis of
  estimated undiscounted future cash flows to be derived from the asset group.

Mineral property acquisition costs capitalized
  in early stage exploration projects are evaluated based on available technical
  data with reference to market related resource ounce prices.

If the recoverable amount is less than
the carrying value of the asset group, the fair value of the asset group is
estimated. An impairment loss is recognized for the amount by which the assets
carrying amount exceeds its estimated fair value.

For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash flows.

(g) Income taxes

The Company uses the asset and
liability method of accounting for income taxes. Under this method, future
income tax assets and liabilities are computed based on differences between the
carrying amount of existing assets and liabilities on the balance sheet and
their corresponding tax values, using the substantively enacted income tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled.

12

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

(g) Income taxes (continued)

Future tax assets are recognized to the
extent that they are considered more likely than not to be realized. The
carrying value of future income tax assets is adjusted, if necessary, by the use
of a valuation allowance to reflect the estimated realizable amount.

(h) Site reclamation obligations

Estimated long-term
asset retirement obligations, comprising continuous pollution control during the
reclamation process, rehabilitation and mine closure, are based on the Company's
environmental management plans in compliance with current technological,
environmental and regulatory requirements.

The net present
values of expected rehabilitation cost estimates are recognized and provided for
in full in the financial statements. The estimates are reviewed annually and are
discounted using rates that reflect inflation and the time value of money. The
discount rate used is based on a pre-tax credit adjusted risk-free rate that is
adjusted to reflect the current market assessments of the time value of money
and the risks specific to the obligation. Annual changes in the provision
consist of finance costs relating to the change in the present value of the
provision and inflationary increases in the provision estimate, as well as
changes in estimates.

The present value
of environmental disturbances created as well as changes to estimates are
expensed under operating expenses against an increase in the rehabilitation
provision for those projects for which a decision to develop has not been taken.
Change in estimates for projects in the development phase is capitalized and
amortised over the life of mine on the units-of-production method.
Rehabilitation costs incurred that are included in the estimates are charged to
the provision. The cost of ongoing current programmes to prevent and control
pollution is charged against income as incurred.

(i) Share capital

The Company records proceeds from share
issuances net of issue costs. Shares issued for consideration other than cash or
in a business combination are valued at the quoted market price on the date
issued.

(j) Loss per common share

Basic loss per common share is
calculated by dividing the loss available to common shareholders by the weighted
average number of common shares outstanding during the year. For all years
presented, loss available to common shareholders equals the reported loss.

Diluted loss per common share is
calculated using the treasury stock method. Under the treasury stock method, the
weighted average number of common shares outstanding used for the calculation of
diluted loss per share assumes that the proceeds to be received on the exercise
of dilutive share options and warrants are used to repurchase common shares at
the average market price during the year.

In years when the Company records a net
loss, the effect of the stock options and warrants would be anti-dilutive and
accordingly basic and diluted loss per share are the same.

13

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

(k) Use of estimates

The preparation of financial statements
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period.

Significant areas requiring the use of
management estimates relate to impairment of mineral property interests,
valuation of inventories, allocation of purchase price consideration to the fair
value of identifiable assets and liabilities acquired, the determination of
amortization, depletion and accretion, determination of reclamation obligations,
the determination of the fair values of financial instruments, assumptions used
in determining the fair value of non-cash stock-based compensation, warrants and
derivatives, determination of valuation allowances for future income tax
liabilities, estimated market related interest rate used to calculate the equity
component of compound financial instruments and allocation of indirect mining
and overhead expenses to production and development costs. Actual results could
differ from these estimates.

(l) Segment disclosure

The primary reporting format of the
Company is by business segment. As there is only one business segment, being the
exploration and development of mineral properties, relevant disclosures are
given in the financial statements.

The secondary reporting format is by
geographical analysis by origin (refer note 23). The accounting policies of the
segments are the same as those described in the accounting policy notes to the
Companys financial statements.

(m) Stock-based compensation

The Company has an equity-settled,
stock-based compensation plan, where the Company grants stock options to certain
employees and non-employees. Non-employees are those individuals over whom the
Company does not exercise, nor have the right to exercise, sufficient control to
establish an employer-employee relationship as determined by law.

For employees, equity stock-based
payments are measured at the fair value of the equity instruments at the date of
grant.

The deferred stock-based compensation
is expensed over the vesting period using the graded method, based on the
Companys estimate of the shares that are expected to eventually vest. For
non-employees equity stock-based payments are measured at fair value of the
equity instruments over the vesting periods, the expense of which is being
recognized on each vesting date.

The Company used the Black Scholes
option pricing model in determining the fair value of the options granted. At
each balance sheet date, the Company revises its estimates of the number of
options that are expected to become exercisable. It recognizes the impact of the
revision of original estimates, if any, in profit or loss, with a corresponding
adjustment to equity. Consideration received on the exercise of stock options is
recorded as share capital and the related contributed surplus is transferred to
share capital.

14

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

(m) Stock-based compensation
(continued)

When unvested options are forfeited the
Company reverses previously recognized charges to profit or loss. The value of
vested options remains in contributed surplus.

(n) Revenue recognition

Revenue is recognized at the fair value
of the consideration received or receivable to the extent that it is probable
that economic benefits will flow to the Company and revenue can be reliably
measured.

The sale of gold and other precious
metals, including metal bearing ore, is recognized when the significant risks
and rewards of ownership of the products are transferred to the buyer.

(o) Long-term borrowings

Borrowings are initially recognized at
fair value net of transaction cost incurred and subsequently measured at
amortized cost, and are amortized to the repayment amount over the expected term
to repayment using the effective interest method.

A compound financial instrument is a
debt security with an embedded conversion option, such as a convertible bond,
and requires the separate recognition of the liability and equity component. The
fair value of the liability portion of a convertible bond is determined using a
market interest rate for an equivalent nonconvertible bond. This amount is
recorded as a liability on an amortized cost basis until extinguished on
conversion or maturity of the bonds. The remainder of the proceeds is allocated
to the conversion option and is recognized under contributed surplus. Borrowings are classified as current liabilities unless the
Company has an unconditional right to defer settlement of the liability for at
least 12 months after the balance sheet date.

(p) Leased assets

Assets subject to finance leases are
  capitalized at the lower of fair value or present value of minimum lease payments
  measured at inception of the lease with the related lease obligation recognized
  at the same amount. Capitalized lease assets are depreciated over their estimated
  useful lives. Finance lease payments are allocated using the rate implicit in
  the lease, which is included in finance costs, and the capital repayment, which
  reduces the liability to the lessor.

Operating lease rentals are charged against
  operating profits on a straight line basis related to the period the assets
  concerned will be used.

(q) Foreign currency
translation

Items included in the financial
statements of each of the Companys subsidiaries are measured using the currency
of the primary economic environment in which the entity operates (the
functional currency).

The Companys integrated foreign
operations translate monetary assets and liabilities denominated in a foreign
currency into Canadian dollars at exchange rates in effect at the balance sheet
date. Non-monetary assets and liabilities are translated at historical exchange
rates.

15

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

(q) Foreign currency translation
(continued)

Revenues and expenses, except
amortization, are translated at the average exchange rates for the period.
Amortization is translated at the same exchange rate as the assets to which it
relates. Gains or losses on translation are recorded in profit or loss.

Translation differences on non-monetary
items, such as equities held at fair value through profit or loss, are reported
as part of their fair value gain or loss. Translation differences on
non-monetary items, such as equities classified as available-for-sale financial
assets, are included in other comprehensive income in equity.

The results and financial position of
all self sustaining entities (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the
presentation currency are translated into the presentation currency as follows:

| |  | assets and liabilities for each balance sheet
      presented are translated at the closing rate at the date of that balance
      sheet;                                                                                                                                                                                                                                             
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | income and expenses for each income statement
      presented are translated at monthly average exchange rates (unless this
      average is not a reasonable approximation of the cumulative effect of the
      rates prevailing on the transaction dates, in which case income and
      expenses are translated at the rates prevailing at the date of the
      transaction); and
| |  | all resulting exchange differences are
      recognized as a separate component of equity (accumulated other
      comprehensive income).                                                                                                                                                                                                                                             

When a foreign operation is sold, such
exchange differences are recognized in the income statement as part of the gain
or loss on sale.

The functional currency of the
Burnstone property is the South African Rand (ZAR) and for the Hollister and
Esmeralda properties it is the United States Dollar (US$). The Canadian Dollar
is the presentation currency for the Company.

(r) Financial instruments

Financial instruments are initially
measured at fair value when the Company becomes a party to their contractual
arrangements. Transaction costs are included in the initial measurement of
financial instruments, except financial instruments classified as at fair value
through profit and loss. The subsequent measurement of financial instruments is
dealt with below.

A financial liability is derecognized
when the obligation under the liability is discharged, cancelled or expires.

On derecognition of a financial
liability, the difference between the carrying amount of the liability
extinguished or transferred to another party and the amount paid is included in
income or loss.

Cash and cash equivalents are
non-derivative financial assets which consist of cash and highly liquid
investments and are readily convertible to known amounts of cash.

These held-for-trading financial assets
are recognized at fair value and are included in current assets.

16

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)
|-- | ---------------------------------------------

(r) Financial instruments
(continued)

Loans and receivables are
non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. They arise when the Company provides money, goods or
services directly to a debtor with no intention of trading the receivable. They
are initially recognized at fair value and subsequently measured at amortized
cost. They are included in current assets, except for maturities greater than 12
months after the balance sheet date. These are classified as non-current
assets.

Available-for-sale financial assets are
non-derivatives that are either designated in this category or not classified in
any of the other categories. They are included in non-current assets unless
management intends to dispose of the investment within 12 months of the balance
sheet date. Purchases and sales of investments are recognized on trade-date, the
date on which the Company commits to purchase or sell the asset.

Investments are initially recognized at
cost plus transaction costs for all financial assets. Investments are
derecognized when sold. Available-for-sale financial assets are subsequently
carried at fair value. Unrealized gains and losses arising from changes in the
fair value of investments classified as available-for-sale are recognized in
equity. When securities classified as available-for-sale are sold or impaired,
the accumulated fair value adjustments are included in profit or loss. The fair
values of quoted investments are based on current bid prices.

These include the use of recent arms
  length transactions, reference to other instruments that are substantially the
  same, discounted cash flow analysis, and option pricing models refined to reflect
  the issuers specific circumstances. The Company assesses at each balance
  sheet date whether there is objective evidence that a financial asset or a group
  of financial assets is impaired. In the case of equity securities classified
  as available-for-sale, a significant or prolonged decline in the fair value
  of the security below its cost is considered in determining whether the securities
  are impaired. If, in the opinion of the directors, an other than temporary decline
  in value exists for available-for-sale financial assets, the cumulative loss
   measured as the difference between the acquisition cost and the current
  fair value, less any impairment loss on that financial asset previously recognized
  in profit or loss  is removed from equity and recognized in profit or
  loss.

Financial assets at fair value through
  profit or loss have been categorized as 'financial assets held-for-trading'.
  A financial asset is classified in this category if acquired principally for
  the purpose of selling in the short term or if so designated by management.
  Derivatives are also categorized as 'held-for-trading' unless they are designated
  as hedges. Assets in this category are classified as current assets if they
  are either held for trading or are expected to be realized within 12 months
  of the balance sheet date.

The fair value of derivative contracts
qualifying as fair value hedges are reflected as assets or liabilities in the
balance sheet. Changes in fair value are recorded in current earnings (loss) in
the Statement of Operations and Comprehensive Loss in each period, consistent
with recording changes to the mark-to-market value of the underlying hedged
asset or liability in income.

17

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|3. | Significant accounting policies
  (continued)                                                                                                                        
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                      
|   | (r) Financial instruments (continued)                                                                                                                                
|   |                                                                                                                                                                      
|   | Financial guarantees are reflected as liabilities on the
      balance sheet, recognized at fair value on inception and subsequently
      carried at amortized cost.
|   |                                                                                                                                                                      
|4. | Capital disclosures                                                                                                                                                  
|   |                                                                                                                                                                      
|   | The Companys objectives when managing capital
  are:                                                                                                                

| |  | To safeguard the Companys ability to continue
      as a going concern, so that it can provide returns for shareholders and
      benefits for other stakeholders, and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | To provide an adequate return to shareholders.                                                                                                                         

The Company considers the items
included in the consolidated statement of shareholders equity and borrowings as
capital. The Company manages the capital structure and makes adjustments to it
in the light of changes in economic conditions and the risk characteristics of
the underlying assets.

In order to maintain or adjust the
capital structure, the Company may issue new shares through private placements
and public offerings, enter into new debt arrangements, sell assets to reduce
debt or return capital to shareholders.

The term facility agreement entered
into (refer note 16(d)) dictates certain requirements in respect of capital
management. These covenants are considered and impacts on the capital management
strategies of the Company. These covenants are standard to loan agreements of
this nature and include:

| |  | Minimum tangible net worth values                                          
| | - | ---------------------------------------------------------------------------
| |  | Maximum debt to equity, debt service cover and
      loan life cover ratios

As at December 31, 2010, the Company
complied with these requirements.

|5. | Cash and cash
equivalents
|-- | -------------------------

| |                  |   | December 31 |  |   | December 31 | 
| | ---------------- | - | ----------- |  | - | ----------- | 
| |                  |   | 2010        |  |   | 2009        | 
| |                  |   | $000       |  |   | $000       | 
| | Cash             | $ | 2,929       |  | $ | 1,298       | 
| | Cash equivalents |   | 9,926       |  |   | 88,166      | 
| |                  | $ | 12,855      |  | $ | 89,464      | 

Cash equivalents are composed of
short-term investments with maturity dates of three months or less, call
accounts and money market investments, which are available on 24 hour notice,
and bankers acceptances which are readily convertible to known cash amounts.

18

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|6. | Amounts receivable
|-- | ------------------

| |                    |   | December 31 |  |   | December 31 | 
| | ------------------ | - | ----------- |  | - | ----------- | 
| |                    |   | 2010        |  |   | 2009        | 
| |                    |   | $000       |  |   | $000       | 
| | HST/VAT receivable | $ | 4,808       |  | $ | 3,388       | 
| | Trade receivables  |   | 3,949       |  |   | 385         | 
| | Other receivables  |   | 583         |  |   | 1,280       | 
| |                    | $ | 9,340       |  | $ | 5,053       | 

|7. | Inventory
|-- | ---------

| |                            |   | December 31 |  |   | December 31 | 
| | -------------------------- | - | ----------- |  | - | ----------- | 
| |                            |   | 2010        |  |   | 2009        | 
| |                            |   | $000       |  |   | $000       | 
| | Stores and materials       | $ | 3,534       |  | $ | 735         | 
| | Unprocessed ore            |   | 3,220       |  |   | 19,481      | 
| | Precious metals in process |   | 11,686      |  |   | 6,096       | 
| |                            | $ | 18,440      |  | $ | 26,312      | 

Production costs recognized in current
loss consist of direct and indirect mining costs, overhead costs, royalties,
depreciation of mining equipment and depletion of mineral properties. During the
year ended December 31, 2010, stores and materials, unprocessed ore and precious
metals in process of $70.3 million have been included under production cost
(2009: $20.6 million) and $8.4 million under depletion charge (2009: $3.3
million).

|8. | Available-for-sale financial instruments
|-- | ----------------------------------------

| |                                |   | December 31 |   |   | December 31 | 
| | ------------------------------ | - | ----------- | - | - | ----------- | 
| |                                |   | 2010        |   |   | 2009        | 
| |                                |   | $000       |   |   | $000       | 
| | Balance, beginning of the year | $ | 4,961       |   | $ | 900         | 
| | Kryso shares                   |   |             |   |   |             | 
| | Addition                       |   | -           |   |   | 1,035       | 
| | Unrealized gain                |   | 603         |   |   | 3,026       | 
| | Disposal                       |   | (5,564      | ) |   | -           | 
| | Balance, end of
      year     | $ | -           |   | $ | 4,961       | 

Kryso Resources Plc (Kryso), a
mineral resources and exploration company exploring gold and precious metal
deposits in Central Asia, is a publicly traded company on the AIM market of the
London Stock Exchange. The 24,229,895 shares were acquired over a period of 3
years at an accumulative original cost of $4 million and were subsequently
revalued to their fair value of $4.9 million on December 31, 2009, which was
calculated based on the closing price of GBP 12.10 pence per share and an
exchange rate of $1.69:1GBP.

The Company disposed of its entire
investment in Kryso during June 2010 for net proceeds of $3.5 million (GBP2.2
million). At disposal date the carrying value of the investment was $5.6 million
(GBP3.6 million), which was calculated based on the closing price of GBP15.15
pence per share and an exchange rate of $1.55:1GBP.

19

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|8. | Available-for-sale financial instruments
      (continued)                                                                                                                                                                                                                                                                                  
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                             
|   | The Company reversed unrealized fair value gains of $2.6
      million (GBP1.7 million) and $1.1 million foreign exchange losses from
      other comprehensive income to current loss, resulting in a net realized
      gain of $0.5 million (GBP0.3 million) and $1.1 million foreign exchange
      loss being recorded in current loss.
|   |                                                                                                                                                                                                                                                                                                                                             
|9. | Held-for-trading financial
  instruments                                                                                                                                                                                                                                                                                                    

| |                                   |  | Number of   |   |   | December 31 |   |  | Number of   |  |   | December 31 | 
| | --------------------------------- |  | ----------- | - | - | ----------- | - |  | ----------- |  | - | ----------- | 
| |                                   |  | warrants    |   |   | 2010        |   |  | warrants    |  |   | 2009        | 
| |                                   |  | (thousands) |   |   | $000       |   |  | (thousands) |  |   | $000       | 
| | Balance, beginning of the year    |  | 6,087       |   | $ | 207         |   |  | 6,087       |  | $ | 80          | 
| | Unrealized fair value (loss) gain |  | -           |   |   | (33         | ) |  | -           |  |   | 127         | 
| | Disposal at fair value            |  | (6,087      | ) |   | (174        | ) |  | -           |  |   | -           | 
| | Balance, end of
      year        |  | -           |   | $ | -           |   |  | 6,087       |  | $ | 207         | 

On June 23, 2010, the Company disposed
of its investment in Kryso warrants for net proceeds of $0.1 million (GBP0.07
million), resulting in a net loss of $0.07 million (GBP0.04 million) recognized
in current loss. The warrants were carried at fair value. Refer to note 8 for
details of the investment in Kryso.

|10. | Related party balances and transactions                                                                                      
|--- | -----------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                              
|    | Related party transactions are recorded at the exchange
      amount which is the amount of consideration paid or
  received.

(a) Loan due from related
parties

| |                                       |   | December 31 |  |   | December 31 | 
| | ------------------------------------- | - | ----------- |  | - | ----------- | 
| |                                       |   | 2010        |  |   | 2009        | 
| |                                       |   | $000       |  |   | $000       | 
| | Balance, beginning of the year        | $ | -           |  | $ | -           | 
| | - Cash advances                       |   | 1,072       |  |   | -           | 
| | - Transfer from
      restricted cash |   | 11,737      |  |   | -           | 
| | Loan advanced                         |   | 12,809      |  |   | -           | 
| | Interest earned                       |   | 227         |  |   | -           | 
| | Foreign
      exchange                |   | 336         |  |   | -           | 
| | Balance, end of year                  | $ | 13,372      |  | $ | -           | 

Black Economic Empowerment (BEE)
legislation in South Africa required a target of 26% ownership in the Companys
South African projects by historically disadvantaged South Africans by 2014. In
order to comply with this legislation, Tranter Burnstone (Pty) Ltd. (Tranter),
a BEE company, acquired 19,938,650 treasury common shares for $38 million in
2007, which was deemed equivalent to the 26% underlying value of the Burnstone
Property on October 1, 2007. Tranter borrowed the funds from Investec Bank Ltd
(Investec), a South African bank, to purchase the shares and Great Basin gave
a loan guarantee in favour of Tranter initially limited to ZAR80 million.

20

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|10. | Related party balances and transactions
      (continued)
|--- | ---------------------------------------------------------

(a) Loan due from related parties
(continued)

Subsequently the Company, through its
wholly owned subsidiary Southgold Exploration (Pty) Ltd (Southgold) agreed
with Investec to increase the guarantee to $21 million (ZAR140 million) to cover
any shortfall in interest or principal repayments on the loan outstanding by
Tranter to Investec. This revised agreement required Southgold to increase the
balance in the Security Call Deposit to $12 million (ZAR80 million) and allowed
for these funds to be utilized towards any advances required to be made to
Tranter under the guarantee agreement (refer note 13). A loan of $13 million
(ZAR 88 million) was advanced to Tranter in October 2010 under the guarantee
agreement to enable Tranter to meet its interest payment obligation to Investec.
The amount set aside in the escrow account was used to partially fulfill this
obligation.

As a result of this loan the remaining
Tranter guarantee is now reduced to $6.9 million (ZAR52 million (refer note
18(a)). Any advances to Tranter under this guarantee are due to be repaid by
Tranter in installments from 2014 to 2017, with interest accruing at the South
African prime interest rate plus 2%. Security for any advances made pursuant to
this guarantee includes a second charge against any shares of the Company held
by Tranter (second to Investec).

(b) Reimbursement for related party
expenses and services rendered

| |                                          |   | December 31 |  |   | December 31 |  
| | ---------------------------------------- | - | ----------- |  | - | ----------- | -
| |                                          |   | 2010        |  |   | 2009        |  
| |                                          |   | $000       |  |   | $000       |  
| |                                          |   |             |  |   |             |  
| | Tranter Gold (Proprietary)
      Limited | $ | -           |  | $ | (18         | )

Tranter Gold (Proprietary) Limited
(Tranter Gold) is a wholly-owned subsidiary of Tranter and has a director in
common with the Company. In 2009, the Company provided Tranter Gold with certain
accounting and administrative services on rates negotiated while the officer was
dealing at arms length with the Company. No services were provided during the
2010 year.

|11. | Property, plant and
equipment
|--- | -----------------------------

| | December 31, 2010                                   |   |         |  |   |              |  |   |          | 
| | --------------------------------------------------- | - | ------- |  | - | ------------ |  | - | -------- | 
| |                                                     |   |         |  |   | Accumulated  |  |   | Net book | 
| |                                                     |   | Cost    |  |   | amortization |  |   | value    | 
| |                                                     |   | $000   |  |   | $000        |  |   | $000    | 
| | Land and buildings                                  | $ | 6,200   |  | $ | 223          |  | $ | 5,977    | 
| | Mine infrastructure                                 |   | 24,958  |  |   | 1,894        |  |   | 23,064   | 
| | Mine development and plant under
      construction |   | 435,255 |  |   | -            |  |   | 435,255  | 
| | Site equipment                                      |   | 51,799  |  |   | 16,439       |  |   | 35,360   | 
| | Leased assets                                       |   | 10,250  |  |   | 1,211        |  |   | 9,039    | 
| | Vehicles                                            |   | 1,859   |  |   | 1,255        |  |   | 604      | 
| | Computers                                           |   | 3,612   |  |   | 932          |  |   | 2,680    | 
| | Office furniture
      and fixtures                 |   | 880     |  |   | 475          |  |   | 405      | 
| |                                                     |   |         |  |   |              |  |   |          | 
| |                                                     | $ | 534,813 |  | $ | 22,429       |  | $ | 512,384  | 

21

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|11. | Property, plant and equipment
  (continued)
|--- | -------------------------------------------

| | December 31, 2009                                   |   |         |  |   |              |  |   |          | 
| | --------------------------------------------------- | - | ------- |  | - | ------------ |  | - | -------- | 
| |                                                     |   |         |  |   | Accumulated  |  |   | Net book | 
| |                                                     |   | Cost    |  |   | amortization |  |   | value    | 
| |                                                     |   | $000   |  |   | $000        |  |   | $000    | 
| | Land and buildings                                  | $ | 5,935   |  | $ | 172          |  | $ | 5,763    | 
| | Mine infrastructure                                 |   | 16,657  |  |   | 192          |  |   | 16,465   | 
| | Mine development and plant under
      construction |   | 139,792 |  |   | -            |  |   | 139,792  | 
| | Site equipment                                      |   | 33,912  |  |   | 8,607        |  |   | 25,305   | 
| | Leased assets                                       |   | 2,545   |  |   | 392          |  |   | 2,153    | 
| | Vehicles                                            |   | 1,812   |  |   | 894          |  |   | 918      | 
| | Computers                                           |   | 1,352   |  |   | 712          |  |   | 640      | 
| | Office furniture
      and fixtures                 |   | 938     |  |   | 500          |  |   | 438      | 
| |                                                     | $ | 202,943 |  | $ | 11,469       |  | $ | 191,474  | 

As at December 31, 2010, $435.3 million
(2009: $139.8 million), comprising of capitalized Burnstone mine development
cost and plant and equipment under construction, is not being amortized.

Mine infrastructure and development
include borrowing costs of $30.3 million (2009: $19.9 million) which were
capitalized during the year (refer note 21).

Assets are pledged as security for long
term borrowings as set-out in note 16(b), (c) and (d).

|12. | Reclamation deposits
|--- | --------------------

| |                                             |   | December 31 |   |   | December 31 |  
| | ------------------------------------------- | - | ----------- | - | - | ----------- | -
| |                                             |   | 2010        |   |   | 2009        |  
| |                                             |   | $000       |   |   | $000       |  
| | Balance, beginning of the year              | $ | 4,590       |   | $ | 2,887       |  
| | Guarantee  Burnstone Property              |   | 144         |   |   | 188         |  
| | Investments  Burnstone
      Property      |   | 354         |   |   | 244         |  
| | Reclamation Bond  Esmeralda Property       |   | -           |   |   | 1,362       |  
| | Reclamation Bond  Hollister
      Property |   | 84          |   |   | -           |  
| | Hypothecation lifted                        |   | (400        | ) |   | -           |  
| | Foreign exchange                            |   | (53         | ) |   | (91         | )
| | Balance, end of
      year                  | $ | 4,719       |   | $ | 4,590       |  

The components of reclamation deposits
on the consolidated balance sheets are as follows:

| |                                |   | Hollister    |   |   | Burnstone    |  |   | Esmeralda    |   |   |              |  
| | ------------------------------ | - | ------------ | - | - | ------------ |  | - | ------------ | - | - | ------------ | -
| |                                |   | Property     |   |   | Property     |  |   | Property     |   |   | December 31, |  
| |                                |   | (note 12(a)) |   |   | (note 12(b)) |  |   | (note 12(c)) |   |   | 2010         |  
| |                                |   | $000        |   |   | $000        |  |   | $000        |   |   | $000        |  
| | Balance, beginning of the year | $ | 2,232        |   | $ | 1,104        |  | $ | 1,254        |   | $ | 4,590        |  
| | Guarantee and investments      |   | -            |   |   | 498          |  |   | -            |   |   | 498          |  
| | Reclamation bond               |   | 84           |   |   | -            |  |   | -            |   |   | 84           |  
| | Hypothecation lifted           |   | (400         | ) |   | -            |  |   | -            |   |   | (400         | )
| | Foreign exchange               |   | (93          | ) |   | 107          |  |   | (67          | ) |   | (53          | )
| | Balance, end of
      year     | $ | 1,823        |   | $ | 1,709        |  | $ | 1,187        |   | $ | 4,719        |  

22

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|12. | Reclamation deposits
(continued)
|--- | --------------------------------

(a) Hollister Property

As at December 31, 2010, the Company
had posted $1.8 million (US$1.8 million) in reclamation deposits with the United
States Bureau of Land Management ("BLM") in respect of exploration drilling and
trial mining on certain areas of the Hollister Property (2009: $2.2 million
(US$2.1 million)).

(b) Burnstone Property

As at December 31, 2010, the Company
placed investments and deposits for guarantees of $1.7 million (ZAR11.3 million)
in favor of the South African Department of Mineral Resources for the
reclamation of the Burnstone Property (2009: $1.1 million (ZAR7.8 million)).

(c) Esmeralda Property

As at December 31, 2010 the Company had
posted cash surety and bonding of $1.2 million (US$1.2 million) in reclamation
deposits with the Division of Environmental Protection of the Nevada States
Department of Conservation and Natural Resources and the Forest Service of the
United States Department in respect of future reclamation of the Esmeralda
Property (2009: $1.3 million (US$1.2 million)).

|13. | Restricted cash
|--- | ---------------

| |                                          |   | December 31 |   |   | December 31 |  
| | ---------------------------------------- | - | ----------- | - | - | ----------- | -
| |                                          |   | 2010        |   |   | 2009        |  
| |                                          |   | $000       |   |   | $000       |  
| | Balance, beginning of the year           | $ | 2,439       |   | $ | 4,171       |  
| | Payment                                  |   | 5,882       |   |   | -           |  
| | Interest earned                          |   | 322         |   |   | 352         |  
| | Reverse prior year fair value adjustment |   | 2,423       |   |   | -           |  
| | Fair value adjustment                    |   | -           |   |   | (2,342      | )
| | Loan advanced                            |   | (11,737     | ) |   | -           |  
| | Foreign exchange                         |   | 671         |   |   | 258         |  
| | Balance, end of
      year               | $ | -           |   | $ | 2,439       |  

Restricted cash represented cash on a
security call deposit with Investec which has been utilized for the loan to
Tranter made under the guarantee provided by the Company (refer note 10(a)) and
note 18(a)).

23

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|14. | Mineral property
interests
|--- | --------------------------

| |                                 |   | December 31 |  |   | December 31 | 
| | ------------------------------- | - | ----------- |  | - | ----------- | 
| |                                 |   | 2010        |  |   | 2009        | 
| |                                 |   | $000       |  |   | $000       | 
| | Hollister Property (note 14(a)) | $ | 64,190      |  | $ | 75,918      | 
| | Burnstone Property (note 14(b)) |   | 114,111     |  |   | 107,158     | 
| | Rusaf Property (note 14(c))     |   | 64,066      |  |   | 36,467      | 
| | Esmeralda Property (note 14(d)) |   | 3,074       |  |   | 3,218       | 
| | Other                           |   | 209         |  |   | 158         | 
| |                                 | $ | 245,650     |  | $ | 222,919     | 

(a) Hollister Property, Nevada,
United States of America

| |                                |   | December 31 |   |   | December 31 |  
| | ------------------------------ | - | ----------- | - | - | ----------- | -
| |                                |   | 2010        |   |   | 2009        |  
| |                                |   | $000       |   |   | $000       |  
| | Balance, beginning of the year | $ | 75,918      |   | $ | 88,624      |  
| | Depletion charge               |   | (7,930      | ) |   | (6,012      | )
| | Foreign exchange               |   | (3,798      | ) |   | (6,694      | )
| | Balance, end of
      year     |   | 64,190      |   | $ | 75,918      |  

Depletion of $1.7 million relating to
stockpiled tons and ounces in process was capitalized to the value of the
unprocessed ore and precious metals in process (refer note 7).

The Hollister Property is pledged as
security for long term borrowings as set-out in note 16(c).

(b) Burnstone Property, Mpumalanga,
Republic of South Africa

| |                                |   | December 31 |  |   | December 31 |  
| | ------------------------------ | - | ----------- |  | - | ----------- | -
| |                                |   | 2010        |  |   | 2009        |  
| |                                |   | $000       |  |   | $000       |  
| | Balance, beginning of the year | $ | 107,158     |  | $ | 130,783     |  
| | Foreign exchange               |   | 6,953       |  |   | (23,625     | )
| | Balance, end of
      year     | $ | 114,111     |  | $ | 107,158     |  

The Burnstone Property us pledged as
security for long term borrowings as set-out in note 16(d).

(c) Rusaf Properties, Kurils Island
and Republic of Tanzania

| |                                                                                                 |   | December 31 |  |   | December 31 | 
| | ----------------------------------------------------------------------------------------------- | - | ----------- |  | - | ----------- | 
| |                                                                                                 |   | 2010        |  |   | 2009        | 
| |                                                                                                 |   | $000       |  |   | $000       | 
| | Balance, beginning of the year                                                                  | $ | 36,467      |  | $ | 36,467      | 
| | Shares issued for contingent payment
      requirement (note 14(c)(i))                          |   | 7,992       |  |   | -           | 
| | Shares issued for settlement
      of remaining contingent payment requirement (note 14(c)(ii)) |   | 19,607      |  |   | -           | 
| | Balance, end of year                                                                            | $ | 64,066      |  | $ | 36,467      | 

The Rusaf Plan of Arrangement (Rusaf
agreement), entered into during the second quarter of 2008, provided for
additional Great Basin shares to be issued in the first three years from
closing, contingent upon gold discoveries above a threshold of 500,000 ounces in
size on certain mineral prospects held by GBG Rusaf Gold Limited (GBG Rusaf).

24

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|14. | Mineral property interests
  (continued)
|--- | ----------------------------------------

(c) Rusaf Properties, Kurils Island
and Republic of Tanzania (continued)

In the event of such discoveries, the
Company would issue shares, the number of which were to be determined using the
higher of closing price on date of acquisition ($3.30) or then-prevailing market
price to the former GBG Rusaf shareholders on the basis of valuing these gold
ounces at US$15/oz for inferred resources and US$40/oz for measured and
indicated resources (subject to a minimum average cut-off grade of 1.5 grams per
tonne or 0.04 oz per ton) (Contingent payment requirement).

The Company also agreed to spend a
minimum of $15 million and up to a maximum of $27 million in terms of the
agreement to explore the acquired properties during the first three years from
closing of the transaction on April 1, 2008. The increased expenditure was
contingent upon gold discoveries above a threshold of 500,000 ounces in size on
certain mineral prospects held by GBG Rusaf.

| | (i)  | Contingent payment requirement
      In connection with this contingent payment requirement, the Company
      issued 3,073,773 shares in January 2010 with a total value of $5.5
      million, which was charged as amortization and capitalized in accordance
      with the Companys policy. The Company recorded $7.9 million as mineral
      properties, consisting of $5.5 million relating to the share issuance and
      a $2.4 million future income tax liability (refer note 20(e) and note 17).                                                                                                              
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | (ii) | Settlement of remaining contingent payment requirement
      The terms of the contingent payment requirement were amended and the
      remaining contingent payment was settled in full through the issuance of
      7.5 million shares in June 2010, with a total value of $13.7 million,
      which was charged as amortization and capitalized in accordance with the
      Companys policy (refer note 20(e)).
      The Company recorded $19.6 million as mineral properties, consisting of
      $13.7 million relating to the share issuance and a $5.9 million future
      income tax liability (refer note 17).

(d) Esmeralda Property, Nevada,
United States of America

| |                                |   | December 31 |   |   | December 31 |  
| | ------------------------------ | - | ----------- | - | - | ----------- | -
| |                                |   | 2010        |   |   | 2009        |  
| |                                |   | $000       |   |   | $000       |  
| | Balance, beginning of the year | $ | 3,218       |   | $ | 3,763       |  
| | Transfer tax and filing fees   |   | -           |   |   | 5           |  
| | Reclamation asset              |   | 29          |   |   | (34         | )
| | Foreign exchange               |   | (173        | ) |   | (516        | )
| | Balance, end of year           | $ | 3,074       |   | $ | 3,218       |  

The Esmeralda Property is pledged as
security for long term borrowings as set-out in note 16(c).

25

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|15. | Accounts payable and accrued
  liabilities
|--- | ------------------------------------------

| |                     |   | December 31 |  |   | December 31 | 
| | ------------------- | - | ----------- |  | - | ----------- | 
| |                     |   | 2010        |  |   | 2009        | 
| |                     |   | $000       |  |   | $000       | 
| | Trade payables      | $ | 9,165       |  | $ | 7,317       | 
| | Accrued liabilities |   | 50,875      |  |   | 21,077      | 
| | Leave liability     |   | 1,692       |  |   | 812         | 
| |                     | $ | 61,732      |  | $ | 29,206      | 

|16. | Long term borrowings                         
|--- | ---------------------------------------------
|    |                                              
|    | Non-current portion of long term
  borrowings

| |                                        |   | December 31 |  |   | December 31 | 
| | -------------------------------------- | - | ----------- |  | - | ----------- | 
| |                                        |   | 2010        |  |   | 2009        | 
| |                                        |   | $ 000      |  |   | $ 000      | 
| | Convertible debentures (note16(a))     | $ | 91,677      |  | $ | 86,304      | 
| | Finance lease liabilities (note 16(b)) |   | 436         |  |   | 644         | 
| | Term facility agreement (note 16(d))   |   | 63,949      |  |   | -           | 
| |                                        | $ | 156,062     |  | $ | 86,948      | 

Current portion of long term
borrowings

| |                                        |   | December 31 |  |   | December 31 | 
| | -------------------------------------- | - | ----------- |  | - | ----------- | 
| |                                        |   | 2010        |  |   | 2009        | 
| |                                        |   | $ 000      |  |   | $ 000      | 
| | Finance lease liabilities (note 16(b)) | $ | 6,955       |  | $ | 724         | 
| | Senior secured notes (note 16(c))      |   | 40,101      |  |   | 43,044      | 
| | Term facility agreement (note 16(d))   |   | 6,460       |  |   | -           | 
| |                                        | $ | 53,516      |  | $ | 43,768      | 

Aggregate future payments, inclusive
of interest

| |                                            |   | Less than 1 year |  |   | 1  5 years |  |   | More than 5 | 
| | ------------------------------------------ | - | ---------------- |  | - | ----------- |  | - | ----------- | 
| |                                            |   |                  |  |   |             |  |   | years       | 
| | Convertible debentures (note 16(a))        | $ | 10,120           |  | $ | 156,438     |  | $ | -           | 
| | Finance lease liabilities (note 16(b))     |   | 7,757            |  |   | 418         |  |   | -           | 
| | Senior secured notes (note 16(c))          |   | 55,410           |  |   | -           |  |   | -           | 
| | Term facility
      agreement (note 16(d)) |   | 10,416           |  |   | 69,602      |  |   | -           | 
| | Total financial liabilities                | $ | 83,703           |  | $ | 226,458     |  | $ | -           | 

26

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|16. | Long term borrowings
(continued)
|--- | --------------------------------

(a) Convertible debentures

| |                                |   | December 31 |   |   | December 31 |  
| | ------------------------------ | - | ----------- | - | - | ----------- | -
| |                                |   | 2010        |   |   | 2009        |  
| |                                |   | $000       |   |   | $000       |  
| | Balance, beginning of the year | $ | 86,304      |   | $ | -           |  
| | Principal amount               |   | -           |   |   | 126,500     |  
| | Transaction cost               |   | -           |   |   | (6,594      | )
| | Equity
      component         |   | -           |   |   | (35,455     | )
| | Liability component            |   | 86,304      |   |   | 84,451      |  
| | Amortized interest expense     |   | 15,886      |   |   | 1,853       |  
| | Interest payments              |   | (10,513     | ) |   | -           |  
| | Balance, end of
      year     | $ | 91,677      |   | $ | 86,304      |  

| |             |   | December 31 |  |   | December 31 | 
| | ----------- | - | ----------- |  | - | ----------- | 
| |             |   | 2010        |  |   | 2009        | 
| |             |   | $000       |  |   | $000       | 
| | Non-current | $ | 91,677      |  | $ | 86,304      | 
| | Current     |   | -           |  |   | -           | 
| |             | $ | 91,677      |  | $ | 86,304      | 

An aggregate of $126.5 million
principal amount of 8% senior unsecured convertible debentures at a price of
$1,000 per Debenture were issued on November 12, 2009. The Debentures mature on
November 30, 2014 (the Maturity date) and bear interest at the rate of 8% per
annum. Interest is payable semi-annually in arrears on May 30 and November 30 of
each year. The Debentures are direct senior unsecured obligations of the Company
and are guaranteed by certain of the Companys subsidiaries.

Holders may convert their Debentures
into Common Shares at any time prior to maturity based on an initial conversion
ratio of 465.1163 Common Shares per $1,000 principal amount of Debentures
(equivalent to an initial conversion price of $2.15 per Common Share).

The Debentures may not be redeemed by
the Company prior to November 30, 2012. From November 30, 2012 to the Maturity
Date, the Company may redeem all or a portion of the Debentures at a price equal
to 100% of the principal amount being redeemed, plus accrued and unpaid
interest, if any, if the weighted average trading price of the Common Shares
exceed 135% of the conversion price for 20 consecutive trading days.

The fair value of the liability
component and the equity component were calculated on issuance of the
debentures. The fair value of the liability component, included in long term
borrowings, was calculated using an estimated market related interest rate of
16.5% . The residual amount, representing the value of the equity component, is
included in shareholders equity in contributed surplus (refer note 20(d)). The
liability component continues to be presented on the amortized cost basis, until
extinguished on conversion or maturity of the debentures. The equity component
is calculated on the issue of the debentures and is not changed in subsequent
periods.

27

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|16. | Long term borrowings
(continued)
|--- | --------------------------------

(b) Finance lease liability

| |                                |   | December 31 |   |   | December 31 |  
| | ------------------------------ | - | ----------- | - | - | ----------- | -
| |                                |   | 2010        |   |   | 2009        |  
| |                                |   | $000       |   |   | $000       |  
| | Balance, beginning of the year | $ | 1,368       |   | $ | 2,437       |  
| | Principal debt amount          |   | 7,261       |   |   | -           |  
| | Interest expense               |   | 598         |   |   | 120         |  
| | Payments                       |   | (2,241      | ) |   | (918        | )
| | Foreign exchange               |   | 405         |   |   | (271        | )
| | Balance, end of
      year     | $ | 7,391       |   | $ | 1,368       |  

| |             |   | December 31 |  |   | December 31 | 
| | ----------- | - | ----------- |  | - | ----------- | 
| |             |   | 2010        |  |   | 2009        | 
| |             |   | $000       |  |   | $000       | 
| | Non-current | $ | 436         |  | $ | 644         | 
| | Current     |   | 6,955       |  |   | 724         | 
| |             | $ | 7,391       |  | $ | 1,368       | 

During 2008 the Company financed site
equipment for its Nevada operations through a finance lease agreement with
Sandvik Customer Finance LLC. The principal debt amount will be repaid in 36
equal installments. Interest is charged at 6.5% on outstanding capital and is
being calculated on the 15thof each month.

During 2010, the Company financed site
equipment for its Burnstone Property through finance lease agreements with
Sandvik Mining and Construction RSA (Proprietary) Limited. The principal amounts
will be repaid in 12 equal installments and interest is charged at 22.4% on
outstanding capital.

The finance leases are collateralized
by the leased assets which had a carrying value of $9 million at December 31,
2010 (2009: $2.2 million) (refer note 11).

(c) Senior secured notes

| |                                 |   | December 31 |   |   | December 31 |  
| | ------------------------------- | - | ----------- | - | - | ----------- | -
| |                                 |   | 2010        |   |   | 2009        |  
| |                                 |   | $000       |   |   | $000       |  
| | Balance, beginning of the year  | $ | 43,044      |   | $ | 33,767      |  
| | Early settlement of 6,925 notes |   | (8,479      | ) |   | -           |  
| | Settlement of 3,000 notes       |   | (3,859      | ) |   | -           |  
| | Transaction fees                |   | (243        | ) |   | -           |  
| | Amortized interest expense      |   | 12,214      |   |   | 15,104      |  
| | Foreign exchange                |   | (2,576      | ) |   | (5,827      | )
| | Balance, end of year            | $ | 40,101      |   | $ | 43,044      |  

| |             |   | December 31 |  |   | December 31 | 
| | ----------- | - | ----------- |  | - | ----------- | 
| |             |   | 2010        |  |   | 2009        | 
| |             |   | $000       |  |   | $000       | 
| | Non-current | $ | -           |  | $ | -           | 
| | Current     |   | 40,101      |  |   | 43,044      | 
| |             | $ | 40,101      |  | $ | 43,044      | 

28

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|16. | Long term borrowings (continued)
|--- | --------------------------------

(c) Senior secured notes
(continued)

On December 12, 2008, the Company
closed a senior secured note financing, issuing a total of 51,500 units and
raising gross proceeds of US$51.5 million which netted approximately $39 million
(US$32 million) following prepayment of 24 months of interest and other costs of
the offering. Each unit consisted of a senior secured note (a note) in the
principal amount of US$1,000 (principal) and 350 common share purchase
warrants (refer note 20(c)(iii).

The fair value of the senior secured
notes and associated warrants was apportioned using the relative fair value
method with the fair value assigned to the warrants being recorded in equity
(refer note 20(c)(iii)).

The notes bear interest of 14% per
annum and are guaranteed on a joint and several basis by all of the Companys
Nevada subsidiaries and collateralized by their assets, being the Hollister
Property and all other Nevada assets (refer note 11, 14(a) and 14(d)) and mature
at 120% of principal.

The notes contained a put option
whereby the holder could put the notes to the Company for repayment after
December 12, 2010. All unpaid notes mature on December 12, 2011.

The Company successfully negotiated the
cancellation of the put option on 29,500 notes and settled 6,925 notes in May
2010 at a nominal loss. The $8.5 million (US$8.3 million) was settled by the
issuance of 2,234,168 common shares to the note holders at a price of $1.75
(US$1.72) (refer note 20(f)) and cash payments of $4.6 million (US$4.5
million).

Through a second agreement, the put
option on a further 12,000 notes was also cancelled in October 2010 and the
Company settled 3,000 notes in December 2010 at 127% of principal by the
issuance of 1,460,601 common shares to the note holders at a price of ≈ $2.81
(refer note 20(g)). The $4.1 million (US$4.1 million) payment consisted of the
$3.9 million (US$3.8 million) settlement and the transaction fees of $0.2
(US$0.2 million). The 3,000 notes were settled at a nominal loss.

(d) Term facility agreement

| |                                           |   | December 31 |   |   | December 31 | 
| | ----------------------------------------- | - | ----------- | - | - | ----------- | 
| |                                           |   | 2010        |   |   | 2009        | 
| |                                           |   | $000       |   |   | $000       | 
| | Balance, beginning of the year            | $ | -           |   | $ | -           | 
| | Principal amount                          |   | 50,224      |   |   | -           | 
| | Additional amount advanced                |   | 25,718      |   |   | -           | 
| | Accrued interest                          |   | 1,708       |   |   | -           | 
| | Facility arrangement fees                 |   | (3,464      | ) |   | -           | 
| | Amortized facility arrangement
      fees |   | 505         |   |   | -           | 
| | Foreign exchange                          |   | (4,282      | ) |   | -           | 
| | Balance, end of year                      | $ | 70,409      |   | $ | -           | 

29

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|16. | Long term borrowings
(continued)
|--- | --------------------------------

(d) Term facility agreement
(continued)

| |             |   | December 31 |  |   | December 31 | 
| | ----------- | - | ----------- |  | - | ----------- | 
| |             |   | 2010        |  |   | 2009        | 
| |             |   | $000       |  |   | $000       | 
| | Non-current | $ | 63,949      |  | $ | -           | 
| | Current     |   | 6,460       |  |   | -           | 
| |             | $ | 70,409      |  | $ | -           | 

In May 2010, the Company closed a $50
million (US$47 million) term facility agreement (the facility) with Credit
Suisse AG and subsequently increased the facility by $25.7 million (US$25
million) in August 2010.

The facility has a maximum term of 4
years from date of first draw down, will be repaid in 13 quarterly consecutive
installments, commencing on May 26, 2011, 12 months after initial draw down, and
bears interest at a margin of 4% over the USD LIBOR rate. Refer to note 22,
Interest rate risk for details of the USD LIBOR rate.

The Company has the option to retire
the loan 12 months after draw down at no additional cost. The Burnstone
Property, its assets and certain subsidiary guarantees serve as security for the
facility (refer note 11 and 14(b)).

The facility agreement contains certain
financial covenants customary to facilities of this nature and includes borrower
tangible net worth, debt to equity ratio, debt service cover ratio and a loan
life cover ratio. As at December 31, 2010, the Company assessed and complied
with all covenants (refer note 4).

Refer to note 18(b) for details of the
hedge entered into under the facility agreement.

|17. | Future income taxes                                                                                                   
|--- | ----------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                       
|    | The estimated tax effect of the significant components
      within the Companys future tax liability was as
follows:

| |                                       |   | December 31 |   |   | December 31 |  
| | ------------------------------------- | - | ----------- | - | - | ----------- | -
| |                                       |   | 2010        |   |   | 2009        |  
| |                                       |   | $000       |   |   | $000       |  
| | Future income tax assets              |   |             |   |   |             |  
| | Loss carry forwards                   | $ | 85,373      |   | $ | 62,721      |  
| | Equipment                             |   | 33,535      |   |   | 26,190      |  
| | Other                                 |   | -           |   |   | 16,785      |  
| | Subtotal                              |   | 118,908     |   |   | 105,696     |  
| | Valuation allowance                   |   | (66,050     | ) |   | (51,068     | )
| | Future income tax asset               |   | 52,858      |   |   | 54,628      |  
| | Future income tax liability           |   |             |   |   |             |  
| | Mineral property interests            |   | (68,688     | ) |   | (63,843     | )
| | Senior secured debt                   |   | (1,101      | ) |   | (1,444      | )
| | Other                                 |   | (2,008      | ) |   | -           |  
| | Future income tax liability           |   | (71,797     | ) |   | (65,287     | )
| | Net future income
      tax liability | $ | 18,939      |   | $ | 10,659      |  

30

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|17. | Future income taxes (continued)                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                      
|    | Income tax expense differs from the amount that would
      result from applying the Canadian federal and provincial tax rates to
      earnings before income taxes.

| | These differences
      result from the following items:             |  |             |   |  |             |  
| | -------------------------------------------------------------------- |  | ----------- | - |  | ----------- | -
| |                                                                      |  | December 31 |   |  | December 31 |  
| |                                                                      |  | 2010        |   |  | 2009        |  
| |                                                                      |  | $000       |   |  | $000       |  
| | Combined Canadian federal and provincial statutory
      rate        |  | 28.5%       |   |  | 30.0%       |  
| |                                                                      |  |             |   |  |             |  
| | Income tax recovery at statutory
      rates                         |  | (8,288      | ) |  | (16,196     | )
| | Difference in foreign tax rates                                      |  | (554        | ) |  | (1,615      | )
| | Increase in valuation allowance                                      |  | (2,498      | ) |  | 3,820       |  
| | Other non-deductible items                                           |  | (1,890      | ) |  | 3,735       |  
| | Change due to foreign exchange                                       |  | 1,876       |   |  | 3,989       |  
| | Change in tax rate                                                   |  | 1,386       |   |  | (1,358      | )
| | Unrealized foreign exchange gain
      (loss) not included in income |  | 10,375      |   |  | 3,087       |  
| | Amounts reported through equity                                      |  | (169        | ) |  | (1,294      | )
| | Other                                                                |  | (407        | ) |  | 292         |  
| | Future income tax recovery                                           |  | (169        | ) |  | (5,540      | )
| | Income taxes (recovered) paid                                        |  | (9          | ) |  | 8           |  
| |                                                                      |  | (178        | ) |  | (5,532      | )

At December 31, 2010, the Company had
available losses for income tax purposes in Canada totaling approximately $64.7
million (2009: $30.4 million), expiring in various years from 2011 to 2030. The
Company has available resource tax pools in Canada of approximately $4.5 million
(2009: $4.9 million), which may be carried forward and utilized to reduce
resource income. Included in these resource tax pools is $3.1 million (2009:
$3.1 million) which is successored, and consequently can only be utilized
against taxable income from specific mineral properties.

At December 31, 2010, the Company had a
net operating loss carry forwards and resource pools for United States income
tax purposes of approximately $173.4 million (US$174.3 million) (2009: $135.4
million (US$128.8 million)) which, if not utilized to reduce United States
taxable income in future periods, expire through the year 2030. These available
tax losses may only be applied to offset future taxable income from the
Company's current United States subsidiaries.

Approximately $9 million (US$9 million)
of the above United States losses are subject to limitation under Section 382.
Accordingly, the Company's ability to utilize these losses each year may be
limited. Furthermore, additional ownership changes under Section 382 may have
occurred, which may further limit the availability of net operating losses.

At December 31, 2010, the Company had
available losses for income tax purposes in South Africa totaling approximately
$18 million (ZAR120 million) (2009: $11 million (ZAR78 million)) as well as
available unredeemed capital of approximately $594 million (ZAR3,932 million)
(2009: $228 million (ZAR1,605 million)), which may be carried forward and
utilized to reduce future resource income.

The Companys future income tax
liability mainly reflects the temporary differences related to the accounting
and tax values of the Groups mineral properties. These balances fluctuate
mainly due to movement in recognized timing differences and foreign exchange.

31

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|17. | Future income taxes (continued)                                                                                                                                                                                                                                                                                                                                                                                   
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                   
|    | During 2010 the Company also recognized future income tax
      liabilities of $2.4 million and $5.9 million from the Rusaf contingent
      liability payment and settlement respectively, which reflects temporary
      differences related to the accounting and tax values of the respective
      entities identifiable assets and liabilities (refer note 14(c)(i) and
      note 14(c)(ii) respectively).
|    |                                                                                                                                                                                                                                                                                                                                                                                                                   
|18. | Other liabilities                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                   
|    | Non-current portion of other
  liabilities                                                                                                                                                                                                                                                                                                                                                                        

| |                                       |   | December 31 |  |   | December 31 | 
| | ------------------------------------- | - | ----------- |  | - | ----------- | 
| |                                       |   | 2010        |  |   | 2009        | 
| |                                       |   | $  000     |  |   | $ 000      | 
| | Financial guarantee (note 18(a))      | $ | 2,597       |  | $ | -           | 
| | Zero cost collar program (note 18(b)) |   | 9,822       |  |   | -           | 
| |                                       | $ | 12,419      |  | $ | -           | 
| |                                       |   |             |  |   |             | 
| | Current portion of other liabilities  |   |             |  |   |             | 
| |                                       |   | December 31 |  |   | December 31 | 
| |                                       |   | 2010        |  |   | 2009        | 
| |                                       | $ | 000        |  | $ | 000        | 
| |                                       |   |             |  |   |             | 
| | Zero cost collar program (note 18(b)) | $ | 278         |  | $ | -           | 

(a) Financial guarantee

The Company, through Southgold provided
a guarantee to lend up to $21 million (ZAR 140 million) to Tranter to cover any
shortfall in interest or principal repayments on the loan outstanding by Tranter
to Investec.

The fair value of the guarantee is
determined by reference to the Companys exposure to potential future losses
under the guarantee. The probability of future losses under the guarantee
agreement, and therefore the fair value of the guarantee, is dependent on the
estimated fair value of the security granted by Tranter on grant date of the
guarantee. Future assessments are not required unless a change to the
contractual relationship results in a change in fair value.

Refer to note 10(a) for details of the
loan advanced to Tranter under the guarantee agreement.

(b) Zero cost collar program

| |                                |   | December 31 |   |   | December 31 | 
| | ------------------------------ | - | ----------- | - | - | ----------- | 
| |                                |   | 2010        |   |   | 2009        | 
| |                                |   | $000       |   |   | $000       | 
| | Balance, beginning of the year | $ | -           |   | $ | -           | 
| | Fair value upon inception      |   | 3,606       |   |   | -           | 
| | Mark-to-market adjustments     |   | 6,860       |   |   | -           | 
| | Foreign exchange               |   | (366        | ) |   | -           | 
| | Balance, end of year           | $ | 10,100      |   | $ | -           | 

32

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|18. | Other liabilities
(continued)
|--- | -----------------------------

(b) Zero cost collar program
(continued)

| |             |   | December 31 |  |   | December 31 | 
| | ----------- | - | ----------- |  | - | ----------- | 
| |             |   | 2010        |  |   | 2009        | 
| |             |   | $,000       |  |   | $000       | 
| | Non-current | $ | 9,822       |  | $ | -           | 
| | Current     |   | 278         |  |   | -           | 
| |             | $ | 10,100      |  | $ | -           | 

In connection with the term facility
agreement (refer note 16(d)), the Company executed a zero cost collar (ZCC)
hedging program for a total of 105,000 gold ounces over a period of three
years.

Commencing January 1, 2011, the Company
will be required to deliver 1,250 gold ounces per month over a twelve month
period. The remaining 90,000 gold ounces will be delivered in 24 equal monthly
deliveries of 3,750 gold ounces, starting January 1, 2012. The program includes
put options priced at US$850 and call options priced at US$1,705 per Au eqv
oz.

The fair value on inception and
subsequent mark-to-market movements were calculated using an option pricing
model with inputs based on the following assumptions:

| |                         |  | August 13     |  |  | December 31   | 
| | ----------------------- |  | ------------- |  |  | ------------- | 
| |                         |  | 2010          |  |  | 2010          | 
| | Gold price (per ounce)  |  | US$1,216      |  |  | US$1,419      | 
| | Risk free interest rate |  | 0.58% - 1.04% |  |  | 0.25% - 1.34% | 
| | Expected life           |  | 5 - 40 months |  |  | 1 - 36 months | 
| | Gold price volatility   |  | 21.9% - 27.8% |  |  | 17.3% - 27%   | 

|19. | Site reclamation obligations                                                                                           
|--- | -----------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                        
|    | The provision for site closure and reclamation costs
      related to the Companys mineral properties is as
  follows:

| |                                      |   | December 31 |  |   | December 31 |  
| | ------------------------------------ | - | ----------- |  | - | ----------- | -
| |                                      |   | 2010        |  |   | 2009        |  
| |                                      |   | $000       |  |   | $000       |  
| | Balance, beginning of the
      year | $ | 3,990       |  | $ | 3,738       |  
| | Accretion                            |   | 280         |  |   | 154         |  
| | Change in
      estimate             |   | 1,354       |  |   | 455         |  
| | Foreign exchange                     |   | 36          |  |   | (357        | )
| | Balance, end of year                 | $ | 5,660       |  | $ | 3,990       |  

The components of the site reclamation
obligation are as follows:

| |                                       |   | December 31 |  |   | December 31 | 
| | ------------------------------------- | - | ----------- |  | - | ----------- | 
| |                                       |   | 2010        |  |   | 2009        | 
| |                                       |   | $000       |  |   | $000       | 
| | Burnstone property (note
      19(a)) | $ | 2,917       |  | $ | 1,368       | 
| | Hollister property (note 19(b))       |   | 1,553       |  |   | 1,426       | 
| | Esmeralda property (note
      19(c)) |   | 1,137       |  |   | 1,141       | 
| | Other properties                      |   | 53          |  |   | 55          | 
| |                                       | $ | 5,660       |  | $ | 3,990       | 

33

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|19. | Site reclamation obligations
  (continued)
|--- | ------------------------------------------

(a) Burnstone Property

The estimated amount of the reclamation
costs to remove infrastructure, capping and backfilling of the decline, vertical
shaft and demolishing of the metallurgical plant and subsequent property
rehabilitation including re-vegetation and fertilization, adjusted for estimated
inflation at 6.32% per year (2009: 8.4%), is $4.7 million (ZAR31 million) (2009:
$1.6 million (ZAR11 million)) and is expected to be spent over a period of
approximately three years beginning in 2034. The credit-adjusted risk free rate
at which the estimated future cash flows have been discounted is 8.29% (2009:
9.2%), to arrive at a net present value of $2.9 million (ZAR19.3 million) (2009:
$1.4 million (ZAR9.6 million)).

(b) Hollister Property

The estimated amount of the reclamation
costs to remove infrastructure, capping and backfilling of the decline and
subsequent property rehabilitation including re-vegetation and fertilization,
adjusted for estimated inflation at 2% per year (2009: 2%), is $1.6 million
(US$1.6 million) (2009: $1.6 million (US$1.5 million)) and is expected to be
spent from 2019. The credit-adjusted risk free rate at which the estimated
future cash flows have been discounted is 2.63% (2009: 3.38%), to arrive at a
net present value of $1.6 million (US$1.6 million) (2009: $1.4 million (US$1.4
million)).

(c) Esmeralda Property

The estimated amount of the reclamation
costs to remove infrastructure and subsequent property rehabilitation, adjusted
for estimated inflation at 2% per year (2009: 2%), is $1.2 million (US$1.2
million) (2009: $1.3 million (US$1.2 million)) and expected to be spent from
2019. The credit-adjusted risk free rate at which the estimated future cash
flows have been discounted is 2.63% (2009: 3.38%), to arrive at a net present
value of $1.1 (US$1.1 million) on December 31, 2010 and 2009.

|20. | Share capital
|--- | -------------

(a) Authorized share capital

The Companys authorized share capital
consists of an unlimited number of common shares without par value.

(b) Share option plan

The Company has a share option plan
approved by the shareholders that allows it to grant options to a maximum number
of eligible shares equaling a rolling percentage of up to 12.5% of the Company's
outstanding common shares, calculated from time to time, subject to regulatory
terms and approval, to its directors, employees, officers and consultants.

The exercise price of each option is
set by the Board of Directors at the time of grant but cannot be less than the
market price (less permissible discounts) on the Toronto Stock Exchange.

34

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(b) Share option plan
(continued)

Pursuant to the option plan, if
outstanding options are exercised, expire, and/or the number of issued and
outstanding common shares of the Company increases, then the options available
to grant under the plan increase correspondingly. Options can have a maximum
term of ten years and typically terminate 30 days following the termination of
the optionees employment or engagement, except in the case of retirement or
death.

Vesting of options is at the discretion
of the Board of Directors at the time the options are granted.

The continuity of share purchase
options is as follows:

| |                            |                  |  |  |                   |   |  | Contractual weighted   | 
| | -------------------------- | ---------------- |  |  | ----------------- | - |  | ---------------------- | 
| |                            | Weighted average |  |  | Number of options |   |  | average remaining life | 
| |                            | exercise price   |  |  | (thousands)       |   |  | (years)                | 
| | Balance, December 31, 2008 | $ 2.82           |  |  | 17,242            |   |  | 2.30                   | 
| | Granted                    | $ 1.57           |  |  | 10,381            |   |  |                        | 
| | Cancelled                  | $ 2.97           |  |  | (6,617            | ) |  |                        | 
| | Exercised                  | $ 1.32           |  |  | (1,124            | ) |  |                        | 
| | Expired                    | $ 2.07           |  |  | (36               | ) |  |                        | 
| | Forfeited                  | $
      1.95     |  |  | (2,911            | ) |  |                        | 
| | Balance, December 31, 2009 | $ 1.64           |  |  | 16,935            |   |  | 2.52                   | 
| | Granted                    | $ 1.83           |  |  | 7,700             |   |  |                        | 
| | Cancelled                  | $ 1.65           |  |  | (150              | ) |  |                        | 
| | Exercised                  | $ 1.49           |  |  | (6,085            | ) |  |                        | 
| | Expired                    | $ 3.04           |  |  | (97               | ) |  |                        | 
| | Forfeited                  | $
      1.84     |  |  | (1,862            | ) |  |                        | 
| | Balance, December 31, 2010 | $ 1.75           |  |  | 16,441            |   |  | 2.26                   | 

35

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(b) Share option plan
(continued)

Options outstanding at December 31,
2010 are as follows:

| |                      |                | Number of options | Number of options
| | -------------------- | -------------- | ----------------- | -----------------
| |                      |                | outstanding       | exercisable      
| | Expiry date          | Exercise price | (thousands)       | (thousands)      
| | February 4, 2011     | $3.00          | 160               | 160              
| | February 18, 2011    | $2.95          | 50                | 50               
| | March 31, 2011       | $3.57          | 90                | 90               
| | April 30, 2011       | $2.45          | 450               | 450              
| | May 21, 2011         | $3.47          | 150               | 150              
| | August 18, 2011      | $2.78          | 270               | 270              
| | October 30, 2011     | $1.50          | 164               | 164              
| | December 11, 2011    | $1.25          | 1,937             | 1,937            
| | February 11, 2012    | $1.75          | 1,703             | 718              
| | April 18, 2012       | $2.68          | 90                | 90               
| | July 15, 2012        | $1.49          | 350               | 200              
| | October 9, 2012      | $1.65          | 315               | 212              
| | February 10, 2013    | $1.78          | 740               | 106              
| | March 26, 2013       | $1.74          | 2,492             | 436              
| | April 10, 2013       | $3.60          | 110               | 110              
| | August 3, 2013       | $1.81          | 1,140             | 340              
| | November 9, 2013     | $2.96          | 480               | -                
| | December 11, 2013    | $1.25          | 255               | 255              
| | January 14, 2014     | $1.35          | 825               | 550              
| | February 11, 2014    | $1.75          | 690               | 460              
| | April 12, 2014       | $1.49          | 2,380             | 1,586            
| | July 15, 2014        | $1.49          | 100               | 67               
| | March 26, 2015       | $1.74          | 1,500             | 500              
| | Total                |                | 16,441            | 8,901            
| | Average option price |                | $1.75             | $1.72            

Out of plan options to acquire 677,766
shares at an exercise price of $0.60 and expiry date of June 1, 2012, remain
outstanding in connection with the acquisition of Rusaf (refer to note
20(d)(i)).

Cancelled options were accounted for in
accordance with CICA 3870 where any carry forward cost not yet recognized was
recognized immediately in profit or loss.

Costs previously recognized on
forfeited options were, upon forfeiture, reversed through the current years
profit or loss.

36

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(b) Share option plan
(continued)

| |                                       | Weighted |             |                           
| | ------------------------------------- | -------- | ----------- | --------------------------
| |                                       | average  | Number of   | Weighted average remaining
| | Range of Exercise Price  Outstanding | exercise | options     | contractual life          
| | Options                               | price    | (thousands) | (years)                   
| | $ 1.25 - $ 1.49                       | $1.38    | 5,846       | 2.36                      
| | $ 1.50 - $ 1.74                       | $1.72    | 4,471       | 2.82                      
| | $ 1.75 - $ 1.99                       | $1.77    | 4,274       | 2.01                      
| | $ 2.25 - $ 2.49                       | $2.45    | 450         | 0.33                      
| | $ 2.50 - $ 2.99                       | $2.88    | 890         | 1.87                      
| | $ 3.00 - $ 3.49                       | $3.23    | 310         | 0.24                      
| | $
      3.50 - $ 3.99                 | $3.59    | 200         | 1.36                      
| | Total                                 | $1.75    | 16,441      | 2.26                      

| |                                       | Weighted             |                  
| | ------------------------------------- | -------------------- | -----------------
| | Range of Exercise Price  Exercisable | average              | Number of options
| | options                               | exercise
      price | (thousands)      
| | $ 1.25 - $ 1.49                       | $1.36                | 4,594            
| | $ 1.50 - $ 1.74                       | $1.70                | 1,312            
| | $ 1.75 - $ 1.99                       | $1.76                | 1,625            
| | $ 2.25 - $ 2.49                       | $2.45                | 450              
| | $ 2.50 - $ 2.99                       | $2.78                | 410              
| | $ 3.00 - $ 3.49                       | $3.23                | 310              
| | $
      3.50 - $ 3.99                 | $3.59                | 200              
| | Total                                 | $1.72                | 8,901            

The exercise prices of all share
purchase options granted were at or above the market price at the grant
date.

The estimated fair value of options
granted for the years ended December 31, 2010 and 2009 have been accounted for
as follows:

| |                                                                                        |   | Years
      ended December 31 |  
| | -------------------------------------------------------------------------------------- | - | ----------------------------- | -
| |                                                                                        |   | 2010                          |  
| | Total compensation cost
      recognized, credited to contributed surplus (note 20(d)) | $ | 7,469                         |  
| | Allocated to Hollister pre-development
      expenses                                  |   | (308                          | )
| | Compensation cost allocated
      to Hollister production cost                         |   | (688                          | )
| | Compensation cost capitalized on Burnstone
      mine development                      |   | (1,475                        | )
| | Compensation cost allocated to bonus provision                                         |   | (111                          | )
| | Stock based compensation expense                                                       | $ | 4,887                         |  

37

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(b) Share option plan
(continued)

The weighted-average assumptions used
to estimate the fair value of options granted during the respective years were
as follows:

| |                         |  | Years ended December
      31 | 
| | ----------------------- |  | ----------------------------- | 
| |                         |  | 2010                          | 
| | Risk free interest rate |  | 2.58%                         | 
| | Expected life           |  | 3.4 years                     | 
| | Expected volatility     |  | 85%                           | 
| | Expected dividends      |  | Nil                           | 

(c) Share purchase warrants

The continuity of share purchase
warrants during the year is as follows:

| | December 31, 2010                     |  |          |  |  |             |  |  |             |   |  |             |   |  |             | 
| | ------------------------------------- |  | -------- |  |  | ----------- |  |  | ----------- | - |  | ----------- | - |  | ----------- | 
| |                                       |  |          |  |  | Outstanding |  |  |             |   |  |             |   |  | Outstanding | 
| |                                       |  |          |  |  | December 31 |  |  |             |   |  |             |   |  | December 31 | 
| |                                       |  | Exercise |  |  | 2009        |  |  | Expired     |   |  | Exercised   |   |  | 2010        | 
| | Expiry dates                          |  | price    |  |  | (thousands) |  |  | (thousands) |   |  | (thousands) |   |  | (thousands) | 
| | October 1, 2010 (note
      20(c)(i)) |  | ZAR20.78 |  |  | 1,684       |  |  | (1,684      | ) |  | -           |   |  | -           | 
| | October 15, 2010 (note 20(c)(ii))     |  | $1.60    |  |  | 57,500      |  |  | (72         | ) |  | (57,428     | ) |  | -           | 
| | December 12, 2011 (note 20(c)(iii))   |  | $1.25    |  |  | 26,994      |  |  | -           |   |  | (2,076      | ) |  | 24,918      | 
| |                                       |  |          |  |  | 86,178      |  |  | (1,756      | ) |  | (59,504     | ) |  | 24,918      | 

| | December 31, 2009                      |  |          |  |  |             |  |  |             |   |  |             |  |  |             | 
| | -------------------------------------- |  | -------- |  |  | ----------- |  |  | ----------- | - |  | ----------- |  |  | ----------- | 
| |                                        |  |          |  |  | Outstanding |  |  |             |   |  |             |  |  | Outstanding | 
| |                                        |  |          |  |  | December 31 |  |  |             |   |  | Issued/     |  |  | December 31 | 
| |                                        |  | Exercise |  |  | 2008        |  |  | Expired     |   |  | Adjustment  |  |  | 2009        | 
| | Expiry dates                           |  | price    |  |  | (thousands) |  |  | (thousands) |   |  | (thousands) |  |  | (thousands) | 
| | April 20, 2009 (note
      20(c)(iv))  |  | $3.50    |  |  | 28,750      |  |  | (28,750     | ) |  | -           |  |  | -           | 
| | October 1, 2010 (note 20(c)(i))        |  | ZAR20.78 |  |  | 1,684       |  |  | -           |   |  | -           |  |  | 1,684       | 
| | October 15,2010 (note
      20(c)(ii)) |  | $1.60    |  |  | -           |  |  | -           |   |  | 57,500      |  |  | 57,500      | 
| | December 12, 2011 (note 20(c)(iii))    |  | $1.80    |  |  | 18,746      |  |  | -           |   |  | 8,248       |  |  | 26,994      | 
| |                                        |  |          |  |  | 49,180      |  |  | (28,750     | ) |  | 65,748      |  |  | 86,178      | 

(i) October 2007 Black Economic
Empowerment transaction (BEE transaction)

In terms of the October 2007 BEE
transaction, the Company issued a total of 1,684,312 Great Basin warrants. Each
warrant was convertible into one Great Basin common share at ZAR20.78 ($3) on or
before October 1, 2010. The warrants were subject to the Company having the
right to require exercise of the warrants if the market price equals or exceeds
ZAR45.72 ($7).

38

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(c) Share purchase warrants
(continued)

(i) October 2007 Black Economic
Empowerment transaction (BEE transaction) (continued)

The 1,684,312 warrants expired
unexercised on October 1, 2010.

The estimated fair value of $1.2
million (ZAR8 million) (using expected volatility of 62.74%, risk free interest
rate of 8.93%, dividends of nil and remaining life of approximately 2 years) of
the warrants was therefore transferred to the contributed surplus reserve (refer
note 20(d)).

(ii) Share issuance, March 2009 -
Public Offering

The Company completed a public
offering on March 13, 2009 whereby it issued 115,000,000 units (the Units) at
a price of $1.30 per Unit. Each Unit consisted of one common share (each, a
Common Share) in the capital of the Company and one-half of one common share
purchase warrant (each whole common share purchase warrant, a Warrant) of the
Company.

Each Warrant entitled the holder
thereof to purchase one Common Share at a price of $1.60 until expiry on October
15, 2010.

On the date of issuance, the fair
value of the 57,500,000 warrants was estimated at $0.10 per warrant and the
Company recorded $5.3 million as fair value of warrants. The valuation was
performed by an independent valuation specialist, using the Black Scholes option
pricing model.

Warrant holders exercised 57,427,856
warrants before the October 15, 2010 expiration date, with only 72,144 warrants
expiring unexercised.

The estimated fair value of $3.5
million was credited to share capital upon exercise of the warrants with the
remaining $6,660 being transferred to the contributed surplus reserve upon
expiry.

(iii) Senior secured notes -
warrants

On December 12, 2008, the Company
completed the issuance of 51,500 senior secured notes at a price of US$1,000 per
note for gross proceeds of US$51.5 million. Each note also granted its holder
350 warrants. Each warrant entitles the holder thereof to subscribe to one
common share of the Company at a price of $1.80 per share over a 36 month term
and has no mandatory conversion by the holder.

These warrants are subject to
anti-dilution rights, including certain anti-dilution rights triggered by the
issuance of common shares at a price less than the exercise price, but have a
minimum exercise price of $1.11 per common share.

39

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(c) Share purchase warrants
(continued)

(iii) Senior secured notes 
warrants (continued)

The Company also granted 721,000
warrants, subject to the same terms as set out above, to the agent. The number
of these warrants was calculated at 4% of the 18,025,000 warrants issued to the
note holders.

The fair value was calculated using
the Black Scholes option pricing model and based upon the following assumptions:
expected life of 3 years; volatility of 82.60%; risk free rate of 3.10% and
dividends of nil.

Based on the above valuation and
adjusted for apportioned transaction cost, the relative fair value of the
18,746,000 warrants was estimated at $6.6 million (US$5.3 million) (refer note
16(c)).

The Equity offering that closed on
March 13, 2009 (refer note 20(c)(ii)) triggered the anti-dilution protection on
the warrants issued in respect of the senior secured notes.

The exercise price of these warrants
  was adjusted to $1.25 (from $1.80) per common share and the number of common
  shares which may be acquired increased to 26,994,240 common shares (including
  agents warrants). No additional fair value was recorded with the increase
  of the warrants.

$0.5 million of the allocated fair
  value was credited to share capital upon exercise of 2 million of these warrants
  during the year.

(iv) April 2007 Public
offering

On April 19, 2007, the Company
completed an offering of 57,500,000 units at a price of $2.60 per unit. Each
unit consisted of one common share and one-half of a common share purchase
warrant of the Company. The common shares and warrants comprising the units
separated immediately upon the closing of the transaction.

Each whole purchase warrant entitled
the holder thereof to purchase one common share of the Company at a price of
$3.50 per share for two years from the date of issuance.

The 28,750,000 warrants expired
unexercised on April 20, 2009.

The estimated fair value of $16.2
million (using expected volatility of 56.9%, risk free interest rate of 4%,
dividends of nil, share price of $2.48 and remaining life of approximately 2
years) of the warrants was therefore transferred to the contributed surplus
reserve (refer note 20(d)).

40

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(d) Contributed surplus

The continuity of contributed surplus
components is:

| | December 31, 2010                                                                                                                   |   |             |   |   |          |   |   |             |  
| | ----------------------------------------------------------------------------------------------------------------------------------- | - | ----------- | - | - | -------- | - | - | ----------- | -
| |                                                                                                                                     |   | December 31 |   |   |          |   |   | December 31 |  
| |                                                                                                                                     |   | 2009        |   |   | Movement |   |   | 2010        |  
| |                                                                                                                                     | $ | 000        |   | $ | 000     |   | $ | 000        |  
| | Fair value of warrants issued which expired
      
    unexercised (note 20(c)(i) and 20(c)(ii))                                    |   | $ 16,449    |   |   | $ 1,185  |   |   | $ 17,634    |  
| | Future income tax on expired warrants                                                                                               |   | (1,294      | ) |   | (169     | ) |   | (1,463      | )
| | Fair value of warrants and options
      available to Rusaf 
    share holders (note 20(d)(i))                                      |   | 1,755       |   |   | -        |   |   | 1,755       |  
| | Accumulated stock-based compensation; net of 
      amount
      transferred to share capital upon exercise of options (note 20(b)) |   | 30,902      |   |   | 2,257    |   |   | 33,159      |  
| | Convertible bond equity component (note 16(a))                                                                                      |   | 35,455      |   |   | -        |   |   | 35,455      |  
| |                                                                                                                                     | $ | 83,267      |   | $ | 3,273    |   | $ | 86,540      |  

| | December 31, 2009                                                                                                                         |   |             |  |   |          |   |   |             |  
| | ----------------------------------------------------------------------------------------------------------------------------------------- | - | ----------- |  | - | -------- | - | - | ----------- | -
| |                                                                                                                                           |   | December 31 |  |   |          |   |   | December 31 |  
| |                                                                                                                                           |   | 2008        |  |   | Movement |   |   | 2009        |  
| |                                                                                                                                           | $ | 000        |  | $ | 000     |   | $ | 000        |  
| | Fair value of warrants issued
      which expired unexercised (note 20(c)(iv))                                                            | $ | 239         |  | $ | 16,210   |   | $ | 16,449      |  
| | Future income tax on expired warrants                                                                                                     |   | -           |  |   | (1,294   | ) |   | (1,294      | )
| | Fair value of warrants and
      options available to Rusaf 
    share holders (note 20(d)(i))                                            |   | 1,755       |  |   | -        |   |   | 1,755       |  
| | Accumulated stock-based compensation; net of
      
      amount transferred to share capital upon exercise of options (note
      20(b)) |   | 19,606      |  |   | 11,296   |   |   | 30,902      |  
| | Convertible bond equity component (note16(a))                                                                                             |   | -           |  |   | 35,455   |   |   | 35,455      |  
| |                                                                                                                                           | $ | 21,600      |  | $ | 61,667   |   | $ | 83,267      |  

(i) Warrants and options available
to former Rusaf shareholders

The fair value of $1.8 million
estimated for the 1,062,033 future Great Basin shares to be issued was
calculated using the Black Scholes option pricing model based on a risk free
interest rate of 2.99%, expected life between 1 month and 4 years, 59%
volatility and nil dividends, and was recorded as contributed surplus in
2008.

41

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital
(continued)
|--- | -------------------------

| | (d) | Contributed surplus (continued)                                                  
| | --- | ---------------------------------------------------------------------------------
| |     |                                                                                  
| |     | (i) Warrants and options available to former Rusaf
      shareholders (continued)

The continuity of these warrants since
acquisition is set out below:

| |                    |          | Outstanding |             |             | Outstanding
| | ------------------ | -------- | ----------- | ----------- | ----------- | -----------
| |                    | Exercise | April 1     |             |             | December 31
| | Expiry dates       | price    | 2008        | Exercised   | Expired     | 2010       
| |                    |          | (thousands) | (thousands) | (thousands) | (thousands)
| | April 11, 2008     | $0.25    | 49          | (22)        | (27)        | -          
| | September 6, 2008  | $0.75    | 27          | (13)        | (14)        | -          
| | September 15, 2008 | $0.75    | 42          | -           | (42)        | -          
| | March 16, 2009     | $0.75    | 93          | -           | (93)        | -          
| | May 17, 2009       | $0.75    | 9           | -           | (9)         | -          
| |                    |          | 220         | (35)        | (185)       | -          
| | Fair value ($000) |          | $ 108       | ($ 8)       | ($ 100)     | $ -        

The continuity of these options since
acquisition is set out below:

| |                    |          | Outstanding |             |             | Outstanding
| | ------------------ | -------- | ----------- | ----------- | ----------- | -----------
| |                    | Exercise | April 1     |             |             | December 31
| | Expiry dates       | price    | 2008        | Exercised   | Expired     | 2010       
| |                    |          | (thousands) | (thousands) | (thousands) | (thousands)
| | December 31, 2010  | $0.25    | 20          | -           | (20)        | -          
| | December 31, 2010  | $0.40    | 144         | -           | (144)       | -          
| | June 1, 2012       | $0.60    | 678         | -           | -           | 678        
| |                    |          | 842         | -           | (164)       | 678        
| | Fair value ($000) |          | $ 1,656     | -           | ($ 323)     | $ 1,333    

(e) Share issuance, January 27, 2010
and June 11, 2010

Pursuant to the contingent liability
requirements associated with the 2008 acquisition of Rusaf, the Company issued a
total of 10,573,773 shares in the six months ending June 30, 2010. The shares
have been valued at their quoted price on the respective days of issuance for a
total value of $19.2 million (refer note 14(c)).

(f) Share issuance, May 26, 2010 
Early settlement of senior secured notes

Pursuant to restructuring of the senior
secured notes, the Company issued 2,234,168 shares to partially satisfy the
early settlement amount of $ 8.5 million (refer note 16(c)).

For such purposes, the parties agreed
to a fixed currency conversion rate of US$1.00 = $1.0129. On May 26, 2010, the
Company accordingly issued 2,234,168 common shares valued at the calculated
price of $1.75 per share and the partial settlement of $3.9 million (US$3.86
million) was recorded against the liability.

42

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|20. | Share capital (continued)
|--- | -------------------------

(g) Share issuance, December 20,
2010  Settlement of senior secured notes

The Company issued 1,460,601 shares to
satisfy the settlement amount of 3,000 notes and transaction fees of $0.2
million (refer note 16(c)).

For such purposes, the parties agreed
to a fixed currency conversion rate of US$1.00 = $1.0129. On December 20, 2010,
the Company accordingly issued 1,460,601 common shares valued at the calculated
price of ≈ $2.81 per share and the settlement of $4.1 million (US$4.1 million)
was recorded against the liability.

|21. | Additional cash flow
information
|--- | --------------------------------

| | Supplementary information:                                                                                                                          |  | December 31 |  |  | December 31 |  
| | --------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------- |  |  | ----------- | -
| |                                                                                                                                                     |  | 2010        |  |  | 2009        |  
| |                                                                                                                                                     |  | $000       |  |  | $000       |  
| |                                                                                                                                                     |  |             |  |  |             |  
| | Interest received                                                                                                                                   |  | 1,600       |  |  | 2,392       |  
| | Interest paid                                                                                                                                       |  | 11,111      |  |  | 24          |  
| | Income taxes recovered (paid)                                                                                                                       |  | 9           |  |  | (8          | )
| |                                                                                                                                                     |  |             |  |  |             |  
| | Non-cash investing activities:                                                                                                                      |  |             |  |  |             |  
| |                                                                                                                                                     |  |             |  |  |             |  
| | Shares issued for mineral properties                                                                                                                |  | -           |  |  | 35          |  
| | Shares issued for settlement of Rusaf contingent payment
      requirements (note 20(e))                                                            |  | 19,243      |  |  | -           |  
| | Accrued interest capitalized to property,
      plant and machinery (note 11)                                                                       |  | 30,312      |  |  | 19,899      |  
| | Facility arrangement fees capitalized to property, plant
      and equipment                                                                        |  | -           |  |  | 781         |  
| | Changes in reclamation estimate capitalized
      to property, plant and equipment                                                                  |  | 1,362       |  |  | 432         |  
| | Changes in accounts payable and accrued liabilities
      included in property, plant and equipment                                                 |  | 25,828      |  |  | 2,179       |  
| | Changes in amounts receivable included in
      property, plant and equipment                                                                       |  | 1,093       |  |  | 2,366       |  
| | Increase in mineral property for future income taxes                                                                                                |  | 8,280       |  |  | -           |  
| | Share based compensation capitalized (refer
      note 20(b))                                                                                       |  | 1,475       |  |  | 1,421       |  
| |                                                                                                                                                     |  |             |  |  |             |  
| | Non-cash financing activities:                                                                                                                      |  |             |  |  |             |  
| |                                                                                                                                                     |  |             |  |  |             |  
| | Fair value of stock options and warrants
      transferred from contributed 
      surplus to share capital on options and
      warrants exercised |  | 11,022      |  |  | 809         |  
| | Fair value of warrants issued with public offering                                                                                                  |  | -           |  |  | 5,308       |  
| | Shares issued for early settlement of
      senior secured notes (note 20(f))                                                                       |  | 3,910       |  |  | -           |  
| | Shares issued for settlement of 3,000 senior secured notes
      (note 20(g))                                                                       |  | 4,102       |  |  | -           |  

43

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|22. | Financial instruments
|--- | ---------------------

Fair Value Hierarchy

Financial instruments recognized at
fair value on the Consolidated Balance Sheets must be classified in one of the
following three fair value hierarchy values:

| |  | Level 1  measurement based on quoted prices
      (unadjusted) observed in active markets for identical assets or
      liabilities;            
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Level 2  measurement based on inputs other
      than quoted prices included in Level 1 that are observable for the asset
      or liability;   
| |  | Level 3  measurement based on inputs that are
      not observable (supported by little or no market activity) for the asset
      or liability.

Financial Assets

The following table sets out the movement
  of the Companys financial asset investments, which are accounted for as
  available-for-sale, held-for-trading, loans and
  receivables or other as defined by CICA 3855, Financial Instruments
   Recognition and Measurement. No items were classified as held-to-maturity.

The carrying amounts, fair values and
  levels per the fair value hierarchy of financial assets as of December 31, 2010,
  are as follows:

| |                               
| | ------------------------------
| |                               
| |                               
| |                               
| | Cash and cash equivalents     
| | Amounts receivable            
| | Reclamation deposits          
| | Due from
      related parties
| |                               
| | Total
      financial assets  

The carrying amounts, fair values and levels per the fair value hierarchy of
  financial assets as of December 31, 2009 were as follows:

| |                                          
| | -----------------------------------------
| |                                          
| |                                          
| |                                          
| | Cash and cash equivalents                
| | Amounts receivable                       
| | Held-for-trading financial instruments   
| | Reclamation deposits                     
| | Available-for-sale financial  instruments
| | Restricted
      cash                    
| |                                          
| | Total
      financial assets             

44

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|22. | Financial instruments
(continued)
|--- | ---------------------------------

Financial Assets (continued)

Movements in available-for-sale and
held-for-trading financial assets were as follows:

| |                                          |   | Available-for-sale |   |   | Held-for-trading |   |   | Total   |  
| | ---------------------------------------- | - | ------------------ | - | - | ---------------- | - | - | ------- | -
| |                                          |   | $000              |   |   | $000            |   |   | $000   |  
| | At January 1, 2009                       | $ | 900                |   | $ | 40,580           |   | $ | 41,480  |  
| | Cash movements during the year           |   | -                  |   |   | 58,335           |   |   | 58,335  |  
| | Conversion of convertible loan to shares |   | 1,035              |   |   | -                |   |   | 1,035   |  
| | Movements in fair
      value            |   | 3,026              |   |   | (2,215           | ) |   | 811     |  
| |                                          |   |                    |   |   |                  |   |   |         |  
| | Balance, December 31, 2009               |   | 4,961              |   |   | 96,700           |   |   | 101,661 |  
| | Cash movements during the year           |   | -                  |   |   | (79,038          | ) |   | (79,038 | )
| | Disposal                                 |   | (5,564             | ) |   | (174             | ) |   | (5,738  | )
| | Movements in fair value                  |   | 603                |   |   | 86               |   |   | 689     |  
| | Balance, December
      31, 2010         | $ | -                  |   | $ | 17,574           |   | $ | 17,574  |  

Financial Liabilities

The carrying amounts and fair values of
financial liabilities are as follows:

| | December 31, 2010                              |   |                |  |   |          | 
| | ---------------------------------------------- | - | -------------- |  | - | -------- | 
| |                                                |   | Estimated fair |  |   | Carrying | 
| |                                                |   | value          |  |   | value    | 
| |                                                | $ | 000           |  | $ | 000     | 
| | Accounts payable and accrued
      liabilities | $ | 61,732         |  | $ | 61,732   | 
| | Other liabilities                              |   | 12,697         |  |   | 12,697   | 
| | Borrowings                                     |   | 253,894        |  |   | 209,578  | 
| | Total
      financial liabilities              | $ | 328,323        |  | $ | 284,007  | 

| | December 31, 2009                              |   |                |  |   |          | 
| | ---------------------------------------------- | - | -------------- |  | - | -------- | 
| |                                                |   | Estimated fair |  |   | Carrying | 
| |                                                |   | value          |  |   | value    | 
| |                                                | $ | 000           |  | $ | 000     | 
| | Accounts payable and accrued
      liabilities | $ | 29,206         |  | $ | 29,206   | 
| | Borrowings                                     |   | 131,496        |  |   | 130,716  | 
| |                                                |   |                |  |   |          | 
| | Total
      financial liabilities              | $ | 160,702        |  | $ | 159,922  | 

Other liabilities consist of the
initial fair value of the guarantee in favour of Investec and the fair value of
the ZCC hedge program (refer note 18(a) and (b)).

Derivatives

A ZCC hedge program for 105,000 gold
ounces was executed in August 2010. Refer to note 18(b) for the terms of the
hedge structure.

45

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|22. | Financial instruments
(continued)
|--- | ---------------------------------

Derivatives (continued)

The fair value of the derivative instrument
  as of December 31, 2010 was as follows:

| |                           
| | --------------------------
| |                           
| | Derivatives not designated
| | as hedging instruments    
| |                           
| | Commodity contracts       

Financial Instrument Risk Exposure
and Risk Management

The Company is exposed in varying
degrees to a variety of financial instrument related risks. The Board approves
and monitors the risk management processes, inclusive of documented treasury
policies, counterparty limits, controlling and reporting structures. The types
of risk exposure and the way in which such exposure is managed, is provided for
as follows:

Credit Risk

Credit risk is the risk of an
unexpected loss if a customer or third party to a financial instrument fails to
meet its contractual obligations and is primarily attributable to liquid
financial assets.

The Companys cash and cash equivalents
  and reclamation deposits are held through large Canadian and South African financial
  institutions. Cash equivalents are composed of financial instruments issued
  by Canadian and South African Banks with high investment-grade ratings. The
  Company does not have financial assets that are invested in asset backed commercial
  paper.

Amounts receivable and other receivables
  consist mainly of HST/VAT and trade receivables. The Companys HST/VAT
  receivables consist substantially of value added tax due from the Government
  of South Africa.

The status of the Companys investments
in held-for-trading and available-for-sale instruments are detailed in notes 5,
8, 9, 10(a), 12 and 13.

The carrying amount of financial assets
recorded in the financial statements, net of any allowances for losses,
represents the Companys maximum exposure to credit risk.

Liquidity Risk

The financial statements have been prepared
  on a going concern basis, which contemplates the realization of assets and the
  settlement of liabilities in the normal course of business. Liquidity risk is
  the risk that the Company will not be able to meet its financial obligations
  as they fall due.

To mitigate this risk the Company monitors
  its spending plans, repayment obligations and cash resources and takes actions
  with the objective of ensuring that there is sufficient capital in order to
  meet short term business requirements, after taking into account cash flows
  from operations and the Companys holdings of cash and cash equivalents.

46

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|22. | Financial instruments
(continued)
|--- | ---------------------------------

Financial Instrument Risk Exposure
and Risk Management (continued)

Liquidity Risk (continued)

| | Contractually obligated cash flow requirements, including
      interest, as at December 31, 2010, are as follows: |  
| | ------------------------------------------------------------------------------------------------------------------ | -
| |                                                                                                                    |  
| |                                                                                                                    |  
| |                                                                                                                    |  
| | Accounts payable and accrued liabilities                                                                           | $
| | Operating leases                                                                                                   |  
| | Asset retirement obligations                                                                                       |  
| | Convertible debentures                                                                                             |  
| | Finance lease liability                                                                                            |  
| | Senior secured notes                                                                                               |  
| | Term facility agreement                                                                                            |  
| | Total                                                                                                              | $

The Company executed an $86 million
public offering and a US$60 million term facility agreement during February 2011
(refer note 24 (a) and (b)). The proceeds from these transactions as well as
cash-flow generated from operations will enable the Company to meet its
obligations as it become due.

Market Risk

The significant market risks to which
the Company is exposed are foreign exchange risk, interest rate risk and
commodity price risk, which are discussed further below. In addition, the
Company is exposed to price increases in cost of labour, energy and equipment
which might influence the ultimate capital investment in the development of the
Companys projects and operational costs.

Foreign exchange risk

The Companys capital and other income
is denominated in Canadian dollars, whilst revenue is denominated in United
States dollars (US$). However, the Companys operating expenses are primarily
incurred in US$ and South African Rand (ZAR). The results of the Companys
operations are subject to currency transaction risk and currency translation
risk.

The operating results and financial
position of the Company are reported in Canadian dollars in the Companys
financial statements. The fluctuation of the US$ and ZAR in relation to the
Canadian dollar will consequently have an impact on the profitability of the
Company and may also affect the value of the Companys assets and the amount of
shareholders equity.

The Company has not entered into any
agreements or purchased any instruments to hedge possible currency risks at this
time.

47

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|22. | Financial instruments
(continued)
|--- | ---------------------------------

Financial Instrument Risk Exposure
  and Risk Management (continued)

Foreign exchange risk (continued)

The exposure of the Companys financial
assets to currency risk is as follows:

| | December 31, 2010              |   |        |  |   |        |  |   |       |  |   |        | 
| | ------------------------------ | - | ------ |  | - | ------ |  | - | ----- |  | - | ------ | 
| |                                |   | US$    |  |   | ZAR    |  |   | CAD   |  |   | Total  | 
| |                                |   | $000  |  |   | $000  |  |   | $000 |  |   | $000  | 
| | Cash and cash equivalents      | $ | 8,426  |  | $ | 2,632  |  | $ | 1,797 |  | $ | 12,855 | 
| | Amounts receivable             |   | 3,886  |  |   | 5,398  |  |   | 56    |  |   | 9,340  | 
| | Reclamation deposits           |   | 3,010  |  |   | 1,709  |  |   | -     |  |   | 4,719  | 
| | Due from
      related parties |   | -      |  |   | 13,372 |  |   | -     |  |   | 13,372 | 
| |                                |   |        |  |   |        |  |   |       |  |   |        | 
| | Total
      financial assets   | $ | 15,322 |  | $ | 23,111 |  | $ | 1,853 |  | $ | 40,286 | 

| | December 31, 2009                       |   |       |  |   |       |  |   |        |  |   |        |  |   |         | 
| | --------------------------------------- | - | ----- |  | - | ----- |  | - | ------ |  | - | ------ |  | - | ------- | 
| |                                         |   | GBP   |  |   | US$   |  |   | ZAR    |  |   | CAD    |  |   | Total   | 
| |                                         |   | $000 |  |   | $000 |  |   | $000  |  |   | $000  |  |   | $000   | 
| | Cash and cash equivalents               | $ | -     |  | $ | 3,345 |  | $ | 20,146 |  | $ | 65,973 |  | $ | 89,464  | 
| | Amounts receivable                      |   | -     |  |   | 774   |  |   | 3,953  |  |   | 327    |  |   | 5,053   | 
| | Held-for-trading  financial instruments |   | 207   |  |   | -     |  |   | -      |  |   | -      |  |   | 207     | 
| | Reclamation deposits                    |   | -     |  |   | 2,637 |  |   | 1,104  |  |   | 850    |  |   | 4,590   | 
| | Available-for-sale                      |   | 4,961 |  |   | -     |  |   | -      |  |   | -      |  |   | 4,961   | 
| | financial instruments                   |   |       |  |   |       |  |   |        |  |   |        |  |   |         | 
| | Restricted
      cash                   |   | -     |  |   | -     |  |   | 2,439  |  |   | -      |  |   | 2,439   | 
| |                                         |   |       |  |   |       |  |   |        |  |   |        |  |   |         | 
| | Total
      financial assets            | $ | 5,168 |  | $ | 6,756 |  | $ | 27,642 |  | $ | 67,150 |  | $ | 106,714 | 

The exposure of the Companys financial
liabilities to currency risk is as follows:

| | December 31, 2010                              |   |         |  |   |        |  |   |        |  |   |         | 
| | ---------------------------------------------- | - | ------- |  | - | ------ |  | - | ------ |  | - | ------- | 
| |                                                |   | US$     |  |   | ZAR    |  |   | CAD    |  |   | Total   | 
| |                                                | $ | 000    |  | $ | 000   |  | $ | 000   |  | $ | 000    | 
| | Accounts payable and accrued
      liabilities | $ | 13,406  |  | $ | 47,680 |  | $ | 646    |  | $ | 61,732  | 
| | Other liabilities                              |   | 10,100  |  |   | 2,597  |  |   | -      |  |   | 12,697  | 
| | Borrowings                                     |   | 111,118 |  |   | 6,783  |  |   | 91,677 |  |   | 209,578 | 
| |                                                |   |         |  |   |        |  |   |        |  |   |         | 
| | Total financial liabilities                    | $ | 134,624 |  | $ | 57,060 |  | $ | 92,323 |  | $ | 284,007 | 

| | December 31, 2009                              |   |        |  |   |        |  |   |        |  |   |         | 
| | ---------------------------------------------- | - | ------ |  | - | ------ |  | - | ------ |  | - | ------- | 
| |                                                |   | US$    |  |   | ZAR    |  |   | CAD    |  |   | Total   | 
| |                                                | $ | 000   |  | $ | 000   |  | $ | 000   |  | $ | 000    | 
| | Accounts payable and
      accrued liabilities | $ | 11,405 |  | $ | 17,419 |  | $ | 382    |  | $ | 29,206  | 
| | Borrowings                                     |   | 44,412 |  |   | -      |  |   | 86,304 |  |   | 130,716 | 
| | Total financial liabilities                    | $ | 55,817 |  | $ | 17,419 |  | $ | 86,686 |  | $ | 159,922 | 

48

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|22. | Financial instruments
(continued)
|--- | ---------------------------------

Financial Instrument Risk Exposure
and Risk Management (continued)

Foreign exchange risk (continued)

At December 31, 2010, the Company is
exposed to currency risk through the following foreign currency denominated
assets and liabilities:

| |                             |   |          |   |   |         |   |   |         |   |   |          |  
| | --------------------------- | - | -------- | - | - | ------- | - | - | ------- | - | - | -------- | -
| |                             |   | US$      |   |   | ZAR     |   |   | CAD     |   |   | Total    |  
| |                             |   | $000    |   |   | $000   |   |   | $000   |   |   | $000    |  
| |                             |   |          |   |   |         |   |   |         |   |   |          |  
| | Financial assets            | $ | 15,322   |   | $ | 23,111  |   | $ | 1,853   |   | $ | 40,286   |  
| | Financial
      liabilities |   | (134,624 | ) |   | (57,060 | ) |   | (92,323 | ) |   | (284,007 | )
| |                             |   |          |   |   |         |   |   |         |   |   |          |  
| | Net
      exposure          | $ | (119,302 | ) | $ | (33,949 | ) | $ | (90,470 | ) | $ | (243,721 | )

Based on the aforementioned net
exposure as at December 31, 2010, and assuming that all other variables remain
constant, a 10% depreciation or appreciation of the Canadian dollar against the
respective currencies would result in a variance as set out below.

| |              |   | US$    |  |   | ZAR   | 
| | ------------ | - | ------ |  | - | ----- | 
| |              |   | $000  |  |   | $000 | 
| | Net exposure | $ | 11,930 |  | $ | 3,395 | 

Interest rate risk

Interest rate risk is the risk that the
fair value or future cash flows of a financial instrument will fluctuate because
of changes in market interest rates.

In respect of financial assets, the
Companys policy is to invest cash at floating interest rates and cash reserves
are to be maintained in cash equivalents in order to maintain liquidity, while
achieving a satisfactory return for shareholders. Fluctuations in interest rates
impact marginally on the value of cash and equivalents and reclamation
deposits.

The exposure of the Companys financial
assets to interest rate risk as at December 31, 2010 was limited to its
investment in cash and cash equivalents of $12.9 million (2009: $89.5 million)
as well as reclamation deposits which are invested at floating rates.

The exposure of the Companys floating
rate interest-bearing financial liabilities as at December 31, 2010 is as
follows:

| |                         | Less than 1   |                   | More than 5
| | ----------------------- | ------------- | ----------------- | -----------
| |                         | year          | 2  5
      years | years      
| | Term facility agreement | $ 6.5 million | $ 63.9 million    | $ -        

The interest rate is linked to the USD
London interbank offered rate (USD LIBOR) at a premium of 4% above USD LIBOR
and is fixed on a quarterly basis. The floating rate on December 31, 2010 was
4.2875% (USD LIBOR of 0.2875% plus 4% premium) (refer note 16(d)).

The impact of a change in the variable
portion (USD LIBOR) of the floating rate is nominal.

49

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|22. | Financial instruments
(continued)
|--- | ---------------------------------

Financial Instrument Risk Exposure
  and Risk Management (continued)

Interest rate risk (continued)

The Companys other borrowings have
fixed interest rates and are therefore not exposed to fluctuation in interest
rates (refer note 16(a), (b) and (c)). The remainder of the Companys financial
liabilities is not exposed to interest rate risk as it is of a non-interest
bearing nature.

Commodity price risk

The value of the Companys mineral
resource properties is related to the price of gold and the outlook for this
mineral. The Company does not follow a hedging strategy to manage its exposure
to commodity prices and only enter into commodity hedge structures to the level
required by certain financing transactions.

Gold prices historically fluctuated
widely and are affected by numerous factors outside of the Companys control,
including, but not limited to, industrial and retail demand, central bank
lending, forward sales by producers and speculators, levels of worldwide
production, short-term changes in supply and demand because of speculative
hedging activities, and certain other factors related specifically to gold.

|23. | Segment disclosure                                                                                                                                                     
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                        
|    | The Company operates in a single reportable operating
      segment, the exploration and development of mineral properties. Geographic
      information is as follows:

| | Assets                                             |   | December 31 |  |   | December 31 | 
| | -------------------------------------------------- | - | ----------- |  | - | ----------- | 
| |                                                    |   | 2010        |  |   | 2009        | 
| |                                                    |   | $000       |  |   | $000       | 
| | Canada                                             |   |             |  |   |             | 
| | Assets other
      than mineral property interests | $ | 11,676      |  | $ | 76,836      | 
| | Tanzania                                           |   |             |  |   |             | 
| | Assets other
      than mineral property interests |   | 618         |  |   | 729         | 
| | Mineral property interests                         |   | 64,066      |  |   | 36,467      | 
| | United States                                      |   |             |  |   |             | 
| | Assets other than mineral
      property interests |   | 21,640      |  |   | 28,344      | 
| | Mine development
      and equipment               |   | 40,509      |  |   | 37,660      | 
| | Mineral property interests                         |   | 67,264      |  |   | 79,136      | 
| | South Africa                                       |   |             |  |   |             | 
| | Assets other than mineral
      property interests |   | 26,308      |  |   | 28,476      | 
| | Mine development
      and equipment               |   | 471,642     |  |   | 153,320     | 
| | Mineral property interests                         |   | 114,320     |  |   | 107,316     | 
| |                                                    | $ | 818,043     |  | $ | 548,284     | 

| | Revenue       |   | December 31 |  |   | December 31 | 
| | ------------- | - | ----------- |  | - | ----------- | 
| |               |   | 2010        |  |   | 2009        | 
| |               | $ | 000        |  | $ | 000        | 
| | United States |   |             |  |   |             | 
| | Ore sales     | $ | 99,706      |  | $ | 33,738      | 

50

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|23. | Segment disclosure
(continued)
|--- | ------------------------------

During 2010 the Company generated
revenue of $99.7 million (US$96.5 million) (2009: $33.7 million (US$28 million))
from its Hollister Property. Refined gold and silver were sold to Red Kite
Explorer Trust under the terms of an off-take agreement, whilst unprocessed ore
was sold under the terms of ore purchase agreements to Newmont Mining
Corporation (2009: Various toll milling and ore purchase agreements to Newmont
Mining Corporation and Echo Bay Minerals Company (Kinross)).

|24. | Subsequent events
|--- | -----------------

Subsequent to December 31, 2010

(a) Bought deal public offering

The Company closed a $75 million bought
deal public offering, as well as the 15% over-allotment option, on February 23,
2011 with the proceeds from this transaction mainly being utilized for working
capital requirements during the production build-up at the Burnstone Mine. The
Company issued 33.7 million shares on closing this transaction, for net proceeds
of $81.7 million.

(b) Term loan facility

The Company executed the Credit
Agreement relating to a US$60 million Term Loan Financing with Credit Suisse AG
on February 23, 2011. The loan has a term of 4 years and is repayable in
quarterly installments commencing September 2011, and will bear interest at a
premium of 3.75% over the 3 month US LIBOR rate. The Company will execute a zero
cost collar hedging program, consisting of a total of approximately 105,000 Au
eqv oz spread over a 4 year term, prior to draw down. Draw down on this facility
is set for March 15, 2011 with approximately US$52 million to be applied towards
full and final settlement of the senior secured notes issued in December
2008.

51

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles
|--- | --------------------------------------------------------------------------------

The Company prepares its financial
statements in accordance with Canadian GAAP which principles differ in certain
respects from those applicable in the United States including practices
prescribed by the United States Securities and Exchange Commission (US GAAP).
Had the Company applied US GAAP, certain items on the statements of operations,
deficit and balance sheets would have been reported as follows:

| |                                                                                               |   | December 31 |   |   | December 31 |  
| | --------------------------------------------------------------------------------------------- | - | ----------- | - | - | ----------- | -
| |                                                                                               |   | 2010        |   |   | 2009        |  
| | Consolidated Balance Sheets                                                                   | $ | 000        |   | $ | 000        |  
| |                                                                                               |   |             |   |   |             |  
| | Total assets under Canadian
      GAAP                                                        | $ | 818,043     |   | $ | 548,284     |  
| | Adjustments under US GAAP:                                                                    |   |             |   |   |             |  
| | Adjustment for convertible
      debentures  transaction costs (note c)                      |   | 240         |   |   | 6,006       |  
| | Adjustment for senior secured notes 
      transaction costs (note c)                        |   | 4,820       |   |   | 3,220       |  
| | Adjustment for term facility agreement  transaction costs
      (note c)                     |   | 2,856       |   |   | -           |  
| |                                                                                               |   |             |   |   |             |  
| | Total assets under US GAAP                                                                    | $ | 825,959     |   | $ | 557,510     |  
| |                                                                                               |   |             |   |   |             |  
| | Total liabilities under
      Canadian GAAP                                                   | $ | 308,606     |   | $ | 174,571     |  
| | Adjustments under US GAAP:                                                                    |   |             |   |   |             |  
| | Recognize warrants issued for
      BEE transaction as a liability (note b)                   |   | 1,179       |   |   | 1,179       |  
| | Mark to market adjustment on warrants  BEE
      (note b)                                    |   | (1,179      | ) |   | (875        | )
| | Adjustment for convertible
      debentures  transaction costs and equity component (note c) |   | 35,695      |   |   | 41,461      |  
| | Adjustment for senior secured
      notes  transaction costs (note c)                        |   | 4,820       |   |   | 3,220       |  
| | Adjustment for term facility agreement  transaction costs
      (note c)                     |   | 2,856       |   |   | -           |  
| | Total liabilities under US GAAP                                                               | $ | 351,977     |   | $ | 219,556     |  
| |                                                                                               |   |             |   |   |             |  
| | Share capital, warrants,
      contributed surplus and accumulated other                      |   |             |   |   |             |  
| | comprehensive income under Canadian GAAP                                                      | $ | 804,062     |   | $ | 639,426     |  
| | Adjustments under US GAAP:                                                                    |   |             |   |   |             |  
| | Stock-based compensation (note a)                                                             |   | 2,658       |   |   | 2,658       |  
| | Recognize warrants issued for
      BEE transaction as a liability (note b)                   |   | (1,179      | ) |   | (1,179      | )
| | Reverse future income tax recognized on
    expired BEE warrants (note b)                     |   | 169         |   |   | -           |  
| | Warrants exercised in prior periods                                                           |   | (3,695      | ) |   | (3,695      | )
| | Adjustment for convertible debentures  equity component
      (note c)                       |   | (35,455     | ) |   | (35,455     | )
| | Share capital, warrants, contributed
      surplus and accumulated                            |   |             |   |   |             |  
| | other comprehensive income under US GAAP                                                      | $ | 766,560     |   | $ | 601,755     |  
| | Deficit under Canadian GAAP                                                                   | $ | (294,625    | ) | $ | (265,713    | )
| | Adjustments under US GAAP:                                                                    |   |             |   |   |             |  
| | Stock-based compensation
      (note a)                                                       |   | (2,658      | ) |   | (2,658      | )
| | Mark-to-market gain / loss realized on
    warrants exercised in prior periods                |   | 3,695       |   |   | 3,695       |  
| | Mark-to-market adjustment on warrants  BEE
      (note b)                                    |   | 1,179       |   |   | 875         |  
| | Reverse future income tax
    recognized on expired BEE warrants (note b)                     |   | (169        | ) |   | -           |  
| | Deficit under US GAAP                                                                         | $ | 292,578     |   | $ | (263,801    | )

52

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)
|--- | --------------------------------------------------------------------------------------------

| |                                                                                                |   | December 31 |   |   | December 31 |  
| | ---------------------------------------------------------------------------------------------- | - | ----------- | - | - | ----------- | -
| | Consolidated Statements of                                                                     |   | 2010        |   |   | 2009        |  
| | Operations                                                                                     |   | $000       |   |   | $000       |  
| |                                                                                                |   |             |   |   |             |  
| | Loss for the period under
      Canadian GAAP                                                  | $ | (28,912     | ) | $ | (48,445     | )
| | Adjustments under US GAAP:                                                                     |   |             |   |   |             |  
| | Recognize release of future
      income tax valuation allowance on expired warrants as equity |   | (169        | ) |   | -           |  
| | Mark-to-market adjustment on warrants (note b)                                                 |   | 304         |   |   | 639         |  
| | Loss for the period under
      US GAAP                                                        |   | (28,777     | ) |   | (47,806     | )
| | Other comprehensive income (loss) under Canadian GAAP and US
      GAAP                        |   | 26,506      |   |   | (24,754     | )
| | Other comprehensive loss under US GAAP                                                         | $ | (2,271      | ) | $ | (72,560     | )
| |                                                                                                |   |             |   |   |             |  
| | Basic and diluted loss per share for the year under US
      GAAP (note 4(j))                  | $ | (0.08       | ) | $ | (0.15       | )

Revenue and production costs disclosed
under Canadian GAAP relate to income generated from the sale of minerals and
related cost of sales during the development stage of the operation. US GAAP
considers income generated from the sale of minerals as well as incremental and
direct costs associated with the sale thereof incidental to the Companys
operations and accordingly these items would have been disclosed as other
income/expenses under US GAAP.

There are no material differences
between Canadian GAAP and US GAAP in the consolidated statements of cash flows
for the years ended December 31, 2010 and 2009.

(a) Stock based compensation

In the year ended December 31, 2003 the
Company adopted, for US GAAP, the fair value based method of accounting for
employee stock-based compensation. The Company adopted the fair value method on
a prospective basis from January 1, 2003. The prospective adoption of this new
US GAAP policy creates no differences with the Companys stock-based
compensation expense reported under Canadian GAAP.

Prior to 2003, no compensation expense
  was recognized under US GAAP because the Company accounted for share options
  using the intrinsic value and the exercise price of the Companys employee
  stock options equalled the market price of the underlying stock on the date
  of the grant.

For the years ended December 31, 2010
  and 2009, there were no differences in stock-based compensation expense in respect
  of employee and non-employee share options which would be required to be charged
  to operations under both Canadian and US GAAP.

As the US GAAP requirements were
adopted on a prospective basis, there is $2.7 million historical difference in
contributed surplus and deficit relating to the period prior to adoption. The
cumulative effect is recognized as of the required effective date. Under
Canadian GAAP no provision was made for the recognition of the cumulative effect
upon adoption of CICA 3870.

53

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)
|--- | --------------------------------------------------------------------------------------------

(b) Fair value of financial
instruments

Under US GAAP, warrants issued by the
Company that are denominated in currencies other than Canadian dollars are
accounted for as a derivative liability, and recorded on the balance sheet as a
liability at fair value, with changes in fair value being charged to earnings
each period.

During 2007, the Company issued
1,684,312 of such warrants upon the conclusion of the BEE transaction and
assigned the issued warrants a value of $1.2 million. At December 31, 2009, the
fair value of these warrants was estimated at $0.3 million resulting in a
cumulative mark-to-market adjustment of $0.9 million recognized under US GAAP.
These warrants expired unexercised on October 1, 2010 at no fair value resulting
in a cumulative mark-to-market adjustment of $1.2 million recognised under US
GAAP. Under Canadian GAAP, the fair value of these warrants was recognized
within equity with no subsequent fair value adjustments. A future income tax
liability of $0.2 million was recorded within equity upon expiry. The future
income tax recovery and charge to equity was reversed under US GAAP.

(c) Convertible debentures, senior
secured notes and term facility agreement

Under US GAAP, the convertible
debentures would be accounted for entirely as a debt instrument as the equity
conversion feature does not represent a cash conversion feature. Under Canadian
GAAP the convertible debenture was split into debt and equity components.

Under US GAAP, debt transaction costs
related to the convertible debenture, term facility agreement and the debt
component of the senior secured notes are recognized as a deferred charge asset
and amortized over the term to maturity of the debt. Under Canadian GAAP, debt
transaction costs are recognized as a reduction of the related debt liability
and related equity components and the accretion of the debt to face value over
the period to maturity is adjusted accordingly.

Under US GAAP, for the years ended
December 31, 2010 and 2009, the carrying value of the convertible debt liability
was adjusted to reclassify the Canadian GAAP equity component of $35 million
plus related issue costs of $6.6 million less the adjustment of $6.4 million
(2009: $0.6 million) for accretion of the liability charged under Canadian
GAAP.

Under US GAAP, for the year ended
December 31, 2010, the transaction costs related to the debt component of the
senior secured notes in the amount of $4.8 million (2009: $3.2 million) would be
recorded as deferred charges, and amortized over the term to maturity.

Under US GAAP, for the year ended
December 31, 2010, the transaction costs related to the term facility agreement
in the amount of $2.9 million would be recorded as deferred charges, and
amortized over the term to maturity.

Amortization of deferred charges is
capitalized in accordance with the Companys policy on interest capitalization;
accordingly, there is no impact on earnings from the adjustments above.

54

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)                                                                                                        
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                     
|    | (d) Other                                                                                                                                                                                           
|    |                                                                                                                                                                                                     
|    | The following additional information would be presented
      if these financial statements were presented in accordance with US GAAP
      with respect to amounts payable and accrued
liabilities:

| |                     |   | December 31 |  |   | December 31 | 
| | ------------------- | - | ----------- |  | - | ----------- | 
| |                     |   | 2010        |  |   | 2009        | 
| |                     | $ | 000        |  | $ | 000        | 
| | Amounts payable     | $ | 9,165       |  | $ | 7,317       | 
| | Accrued liabilities |   |             |  |   |             | 
| | Burnstone           |   | 39,616      |  |   | 13,238      | 
| | Hollister           |   | 7,837       |  |   | 6,297       | 
| | Other               |   | 2,194       |  |   | 543         | 
| | Annual bonuses      |   | 2,920       |  |   | 1,811       | 
| |                     |   |             |  |   |             | 
| |                     | $ | 61,732      |  | $ | 29,206      | 

(e) Accounting Standard Codification
(ASC) No. 740, Income Taxes (ASC 740)

In June 2006, the Financial Accounting
Standards Board (FASB) issued guidance to address diversity in practice
regarding the interpretation and application of the accounting model for
uncertain tax positions. ASC 740 clarifies the accounting for income taxes, by
prescribing a minimum recognition threshold a tax position is required to meet
before being recognized in the financial statements.

ASC 740 also provides guidance on
de-recognition, measurement, classification, interest and penalties, accounting
in interim periods, disclosure and transition and was effective for fiscal years
beginning after December 15, 2006.

The Company adopted the provisions of
uncertain tax positions in accordance with ASC 740 on January 1, 2007, which did
not have a material impact on the consolidated financial position or results of
operations, and reported no unrecognized tax benefits for the year ending
December 31, 2007, 2008 and 2009. For December 31, 2010, there were no increases
or decreases in unrecognized tax benefits as a result of tax positions taken in
a prior year.

There were also no increases or
decreases in unrecognized tax benefits from tax positions taken in the current
year. As a result, there are no unrecognized tax benefits at December 31, 2010.
As there were no unrecognized tax benefits at December 31, 2010, there are also
no unrecognized tax benefits that could affect the effective tax rate if
recognized.

There was no interest and penalties
recognized on the Statement of Operations and Comprehensive Loss or the
statement of financial position. The Companys policy is to recognize accrued
interest and penalties related to unrecognized tax benefits in operating
expenses.

The Company is subject to taxes in
Canada, United States, South Africa, Tanzania and Russia.

55

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)
|--- | --------------------------------------------------------------------------------------------

(e) Accounting Standard Codification
(ASC) No. 740, Income Taxes (ASC 740) (continued)

The following tax years remain subject
to examination as of December 31, 2010 by major tax jurisdiction:

| | Canada       | 2003 to present
| | ------------ | ---------------
| | United Sates | 1997 to present
| | South Africa | 2004 to present

(f) Additional disclosures

The Company meets the definition of a
development stage enterprise under both Canadian and US GAAP. Pursuant to the
rules and regulations of the SEC, a mining company in the exploration stage
should not refer to itself as a development stage company in its financial
statements, even though such Company should comply with the measurement and
disclosure requirements for development stage enterprises.

Under US GAAP, the Company is required
  to provide additional disclosures from its date of inception, or the date the
  Company was reactivated to undertake development stage activities.

Consolidated summarized statements of
  operations and deficit and cash flows since January 1, 1998, the date the Company
  was considered to be reactivated to undertake development stage activities,
  to December 31, 2010 are presented as follows:

| | Period from January 1, 1998 to                                                                                                                                                     |  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -
| |                                                                                                                                                                                    |  
| | Consolidated statement of operations and deficit                                                                                                                                   |  
| | Mineral property exploration,
      development and reclamation                                                                                                                    | $
| | General and administration, salaries,
      professional fees and other                                                                                                            |  
| | Other income                                                                                                                                                                       |  
| | Net loss for the period from January 1, 1998
      to December 31, 2010, being the 
      deficit accumulated during the
      exploration, pre-development and development stages |  
| | Opening deficit accumulated during the development stage,
      January 1, 1998                                                                                                    |  
| |                                                                                                                                                                                    |  
| | Ending deficit accumulated during the development stage,
      December 31, 2010                                                                                                   | $

56

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)
|--- | --------------------------------------------------------------------------------------------

(f) Additional disclosures
(continued)

| |                                                     |   | Period from January 1, 1998 to |  
| | --------------------------------------------------- | - | ------------------------------ | -
| |                                                     |   | December 31, 2010              |  
| | Consolidated
      statements of cash flows         |   | $000                          |  
| | Operating activities                                | $ | (244,797                       | )
| | Investing activities                                |   | (492,438                       | )
| | Financing activities                                |   | 744,482                        |  
| | Increase in cash and cash equivalents               | $ | 7,247                          |  
| | Cash and cash equivalents - January 1, 1998         |   | 1,922                          |  
| | Acquired through business acquisitions              |   | 4,512                          |  
| | Foreign exchange                                    |   | (826                           | )
| | Cash and cash
      equivalents  December 31, 2010 | $ | 12,855                         |  

Consolidated statements of change in
equity (Unaudited)

| |                                |  | Common Shares |  |  |             |  |  |        |   |  |          |  |  | Accumulated |  |  |          |  
| | ------------------------------ |  | ------------- |  |  | ----------- |  |  | ------ | - |  | -------- |  |  | ----------- |  |  | -------- | -
| |                                |  |               |  |  |             |  |  |        |   |  |          |  |  |             |  |  |          |  
| |                                |  | Issue         |  |  | Number of   |  |  |        |   |  |          |  |  | Contributed |  |  | Retained |  
| |                                |  | Price         |  |  | shares      |  |  | Amount |   |  | Warrants |  |  | surplus     |  |  | deficit  |  
| |                                |  | $             |  |  | (thousands) |  |  | $'000  |   |  | $'000    |  |  | $'000       |  |  | $'000    |  
| | Balance, January 1, 1998       |  |               |  |  | 14,161      |  |  | 22,791 |   |  |         |  |  |            |  |  | (11,120  | )
| | Escrow shares                  |  | 0.01          |  |  | 750         |  |  | 8      |   |  |         |  |  |            |  |  |         |  
| | Exercise of options            |  | 1.28          |  |  | 42          |  |  | 54     |   |  |         |  |  |            |  |  |         |  
| | Private placement              |  | 2.00          |  |  | 1,705       |  |  | 2,983  |   |  |         |  |  |            |  |  |         |  
| | For mineral property interests |  | 1.43          |  |  | 162         |  |  | 232    |   |  |         |  |  |            |  |  |         |  
| | Loan guarantee                 |  | 2.05          |  |  | 98          |  |  | 201    |   |  |         |  |  |            |  |  |         |  
| | Loss for the year              |  | -             |  |  |            |  |  |       |   |  |         |  |  |            |  |  | (6,819   | )
| | Stock based
      compensation |  | -             |  |  |            |  |  |       |   |  |         |  |  | 372         |  |  |         |  
| |                                |  |               |  |  |             |  |  |        |   |  |          |  |  |             |  |  |          |  
| | Balance, December 31, 1998     |  |               |  |  | 16,918      |  |  | 26,269 |   |  |         |  |  | 372         |  |  | (17,939  | )
| | Exercise of warrants           |  | 1.16          |  |  | 1,835       |  |  | 2,126  |   |  |         |  |  |            |  |  |         |  
| | Exercise of options            |  | 1.17          |  |  | 1,277       |  |  | 1,488  |   |  |         |  |  |            |  |  |         |  
| | Private placement              |  | 1.30          |  |  | 4,864       |  |  | 6,012  |   |  |         |  |  |            |  |  |         |  
| | For donations                  |  | 2.50          |  |  | 4           |  |  | 10     |   |  |         |  |  |            |  |  |         |  
| | For mineral property interests |  | 1.28          |  |  | 2,825       |  |  | 3,606  |   |  |         |  |  |            |  |  |         |  
| | Loss for the year              |  | -             |  |  |            |  |  |       |   |  |         |  |  |            |  |  | (6,313   | )
| | Stock based compensation       |  | -             |  |  |            |  |  |       |   |  |         |  |  | 1,385       |  |  |         |  
| |                                |  |               |  |  |             |  |  |        |   |  |          |  |  |             |  |  |          |  
| | Balance, December 31, 1999     |  |               |  |  | 27,723      |  |  | 39,511 |   |  |         |  |  | 1,757       |  |  | (24,252  | )
| | Exercise of warrants           |  | 1.31          |  |  | 5,312       |  |  | 6,985  |   |  |         |  |  |            |  |  |         |  
| | Exercise of options            |  | 1.30          |  |  | 147         |  |  | 190    |   |  |         |  |  |            |  |  |         |  
| | Private placement              |  | 2.00          |  |  | 5,000       |  |  | 9,299  |   |  |         |  |  |            |  |  |         |  
| | Loss for the year              |  | -             |  |  |            |  |  |       |   |  |         |  |  |            |  |  | (11,347  | )
| | Stock based
      compensation |  | -             |  |  |            |  |  |       |   |  |         |  |  | 41          |  |  |         |  
| |                                |  |               |  |  |             |  |  |        |   |  |          |  |  |             |  |  |          |  
| | Balance, December 31, 2000     |  |               |  |  | 38,182      |  |  | 55,985 |   |  |         |  |  | 1,798       |  |  | (35,599  | )
| | Share issuance costs           |  | -             |  |  |            |  |  | (31    | ) |  |         |  |  |            |  |  |         |  
| | Loss for the year              |  | -             |  |  |            |  |  |       |   |  |         |  |  |            |  |  | (9,925   | )
| | Stock based compensation       |  | -             |  |  |            |  |  |       |   |  |         |  |  | 860         |  |  |         |  
| |                                |  |               |  |  |             |  |  |        |   |  |          |  |  |             |  |  |          |  
| | Balance, December 31, 2001     |  |               |  |  | 38,182      |  |  | 55,954 |   |  |         |  |  | 2,658       |  |  | (45,524  | )

57

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)
|--- | --------------------------------------------------------------------------------------------

| | (f) | Additional disclosures (continued)                                       
| | --- | -------------------------------------------------------------------------
| |     |                                                                          
| |     | Consolidated statements of change in equity
      (Unaudited) (continued)

| |                                             |  | Common Shares |  |  |             |  |  |         |  |  |          |   |  | Accumulated |   |  |          |  
| | ------------------------------------------- |  | ------------- |  |  | ----------- |  |  | ------- |  |  | -------- | - |  | ----------- | - |  | -------- | -
| |                                             |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| |                                             |  | Issue         |  |  | Number of   |  |  |         |  |  |          |   |  | Contributed |   |  | Retained |  
| |                                             |  | Price         |  |  | shares      |  |  | Amount  |  |  | Warrants |   |  | surplus     |   |  | deficit  |  
| |                                             |  | $             |  |  | (thousands) |  |  | $'000   |  |  | $'000    |   |  | $'000       |   |  | $'000    |  
| |                                             |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31,
      2001            |  |               |  |  | 38,182      |  |  | 55,954  |  |  |         |   |  | 2,658       |   |  | (45,524  | )
| | Exercise of warrants                        |  | 1.00          |  |  | 2,257       |  |  | 2,257   |  |  |         |   |  |            |   |  |         |  
| | Exercise of options                         |  | 0.96          |  |  | 680         |  |  | 656     |  |  |         |   |  |            |   |  |         |  
| | Private placement                           |  | 1.50          |  |  | 5,742       |  |  | 7,891   |  |  |         |   |  |            |   |  |         |  
| | Warrants issued for mineral
      property  |  | -             |  |  |            |  |  |        |  |  | 295      |   |  |            |   |  |         |  
| | Stock based compensation                    |  | -             |  |  |            |  |  |        |  |  |         |   |  | 375         |   |  |         |  
| | Loss for the year                           |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (4,792   | )
| |                                             |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31,
      2002            |  |               |  |  | 46,861      |  |  | 66,758  |  |  | 295      |   |  | 3,033       |   |  | (50,316  | )
| | Exercise of warrants                        |  | 1.51          |  |  | 6,542       |  |  | 7,684   |  |  |         |   |  |            |   |  |         |  
| | Exercise of options                         |  | 1.43          |  |  | 3,637       |  |  | 5,204   |  |  |         |   |  |            |   |  |         |  
| | Private placement                           |  | 1.80          |  |  | 5,600       |  |  | 9,417   |  |  |         |   |  |            |   |  |         |  
| | Shares issued for mineral
      property    |  | 1.38          |  |  | 10,000      |  |  | 13,800  |  |  |         |   |  |            |   |  |         |  
| | Fair value of stock options exercised       |  | -             |  |  |            |  |  | 430     |  |  |         |   |  | (430        | ) |  |         |  
| | Loss for the year                           |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (13,043  | )
| | Stock based compensation                    |  | -             |  |  |            |  |  |        |  |  |         |   |  | 2,131       |   |  |         |  
| | Exercise of warrants - fair value           |  | -             |  |  |            |  |  | 7,020   |  |  |         |   |  |            |   |  |         |  
| |                                             |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31,
      2003            |  |               |  |  | 72,640      |  |  | 110,313 |  |  | 295      |   |  | 4,734       |   |  | (63,359  | )
| | Exercise of warrants                        |  | 1.81          |  |  | 2,138       |  |  | 3,785   |  |  |         |   |  |            |   |  |         |  
| | Exercise of options                         |  | 1.16          |  |  | 836         |  |  | 970     |  |  |         |   |  |            |   |  |         |  
| | Shares issued for mineral property          |  | 2.98          |  |  | 11,000      |  |  | 32,780  |  |  |         |   |  |            |   |  |         |  
| | Fair value of stock options
      exercised |  | -             |  |  |            |  |  | 239     |  |  |         |   |  | (239        | ) |  |         |  
| | Loss for the year                           |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (3,695   | )
| | Warrants expired unexercised                |  | -             |  |  |            |  |  |        |  |  | (221     | ) |  | 221         |   |  |         |  
| | Exercise of warrants - fair value           |  | -             |  |  |            |  |  | 74      |  |  | (74      | ) |  |            |   |  |         |  
| | Stock based compensation                    |  | -             |  |  |            |  |  |        |  |  |         |   |  | 2,473       |   |  |         |  
| |                                             |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31,
      2004            |  |               |  |  | 86,614      |  |  | 148,161 |  |  |         |   |  | 7,189       |   |  | (67,054  | )
| | Exercise of warrrants                       |  | 0.91          |  |  | 5,500       |  |  | 5,018   |  |  |         |   |  |            |   |  |         |  
| | Exercise of options                         |  | 0.96          |  |  | 1,572       |  |  | 1,509   |  |  |         |   |  |            |   |  |         |  
| | Exercise of warrants - fair value           |  | -             |  |  |            |  |  | 2,845   |  |  |         |   |  |            |   |  |         |  
| | Stock base compensation                     |  | -             |  |  |            |  |  |        |  |  |         |   |  | 476         |   |  |         |  
| | Loss
      for the year                     |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (1,519   | )
| |                                             |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31, 2005                  |  |               |  |  | 93,686      |  |  | 157,533 |  |  |         |   |  | 7,665       |   |  | (68,573  | )
| | Exercise of options                         |  | 1.49          |  |  | 1,193       |  |  | 1,783   |  |  |         |   |  |            |   |  |         |  
| | Shares issued for cash net of issue costs   |  | 2.25          |  |  | 11,200      |  |  | 23,059  |  |  |         |   |  |            |   |  |         |  
| | Private placement net of
      issue costs  |  | 2.25          |  |  | 3,333       |  |  | 7,034   |  |  |         |   |  |            |   |  |         |  
| | Shares issued for mineral property          |  | 1.90          |  |  | 4,000       |  |  | 7,600   |  |  |         |   |  |            |   |  |         |  
| | Fair value of stock options
      exercised |  | -             |  |  |            |  |  | 754     |  |  |         |   |  | (754        | ) |  |         |  
| | Compensation warrants                       |  | -             |  |  |            |  |  |        |  |  | 159      |   |  |            |   |  |         |  
| | Stock based compensation                    |  | -             |  |  |            |  |  |        |  |  |         |   |  | 3,610       |   |  |         |  
| | Loss
      for the year                     |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (11,478  | )
| |                                             |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31, 2006                  |  |               |  |  | 113,412     |  |  | 197,763 |  |  | 159      |   |  | 10,521      |   |  | (80,051  | )

58

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)
|--- | --------------------------------------------------------------------------------------------

| | (f) | Additional disclosures (continued)                                         
| | --- | ---------------------------------------------------------------------------
| |     |                                                                            
| |     | Consolidated statements of change in equity (Unaudited)
        (continued)

| |                                                                                                         |  | Common Shares |  |  |             |  |  |         |  |  |          |   |  | Accumulated |   |  |          |  
| | ------------------------------------------------------------------------------------------------------- |  | ------------- |  |  | ----------- |  |  | ------- |  |  | -------- | - |  | ----------- | - |  | -------- | -
| |                                                                                                         |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| |                                                                                                         |  | Issue         |  |  | Number of   |  |  |         |  |  |          |   |  | Contributed |   |  | Retained |  
| |                                                                                                         |  | Price         |  |  | shares      |  |  | Amount  |  |  | Warrants |   |  | surplus     |   |  | deficit  |  
| |                                                                                                         |  | $             |  |  | (thousands) |  |  | $'000   |  |  | $'000    |   |  | $'000       |   |  | $'000    |  
| |                                                                                                         |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31, 2006                                                                              |  |               |  |  | 113,412     |  |  | 197,763 |  |  | 159      |   |  | 10,521      |   |  | (80,051  | )
| | Adoption of accounting policy                                                                           |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  |         |  
| | Exercise of options                                                                                     |  | 1.69          |  |  | 3,016       |  |  | 5,111   |  |  |         |   |  |            |   |  |         |  
| | Shares issued for cash net of issue costs                                                               |  | 2.11          |  |  | 57,500      |  |  | 121,428 |  |  |         |   |  |            |   |  |         |  
| | Shares issued for Hecla Ventures Corp.                                                                  |  | 2.48          |  |  | 7,930       |  |  | 19,667  |  |  |         |   |  |            |   |  |         |  
| | Shares issued for Tranter Burnstone Pty Ltd                                                             |  | 1.82          |  |  | 19,939      |  |  | 36,323  |  |  |         |   |  |            |   |  |         |  
| | Share purchase warrants exercised                                                                       |  | 2.16          |  |  | 1,599       |  |  | 3,459   |  |  |         |   |  |            |   |  |         |  
| | Fair value of stock options exercised                                                                   |  | -             |  |  |            |  |  | 2,005   |  |  |         |   |  | (2,005      | ) |  |         |  
| | Compensation warrants exercised                                                                         |  | -             |  |  |            |  |  | 142     |  |  | (142     | ) |  |            |   |  |         |  
| | Compensation warrants expired                                                                           |  | -             |  |  |            |  |  |        |  |  | (17      | ) |  | 17          |   |  |         |  
| | Fair value of warrants exercised                                                                        |  | -             |  |  |            |  |  | 547     |  |  |         |   |  |            |   |  |         |  
| | Warrants issued persuant to share issuance                                                              |  | -             |  |  |            |  |  |        |  |  | 16,210   |   |  |            |   |  |         |  
| | Stock based compensation                                                                                |  | -             |  |  |            |  |  |        |  |  |         |   |  | 5,634       |   |  |         |  
| | Loss for the year                                                                                       |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (51,510  | )
| | Fair value adjustment - financial instruments                                                           |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  |         |  
| |                                                                                                         |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31, 2007                                                                              |  |               |  |  | 203,396     |  |  | 386,445 |  |  | 16,210   |   |  | 14,167      |   |  | (131,561 | )
| | Fair value of options exercised                                                                         |  |               |  |  |            |  |  | 2,076   |  |  |         |   |  | (2,076      | ) |  |         |  
| | Fair value of warrants exercised                                                                        |  |               |  |  |            |  |  | 546     |  |  |         |   |  |            |   |  |         |  
| | Share purchase options exercised                                                                        |  | 2.07          |  |  | 2,250       |  |  | 4,655   |  |  |         |   |  |            |   |  |         |  
| | Shares issued to CW Properties LLC,
      February 2008                                                 |  | 2.97          |  |  | 10          |  |  | 30      |  |  |         |   |  |            |   |  |         |  
| | Shares issued for Rusaf Gold Limited, April 2008                                                        |  | 3.45          |  |  | 6,614       |  |  | 22,788  |  |  |         |   |  |            |   |  |         |  
| | Shares issued for Rusaf Gold Limited, July
      2008                                                   |  | 3.49          |  |  | 22          |  |  | 77      |  |  |         |   |  |            |   |  |         |  
| | Shares issued for Puma Gold (Pty) Ltd, July
      2008                                                  |  | 3.57          |  |  | 1,862       |  |  | 6,649   |  |  |         |   |  |            |   |  |         |  
| | Rusaf share purchase warrants exercised,
      October 2008                                             |  | 1.38          |  |  | 13          |  |  | 18      |  |  |         |   |  |            |   |  |         |  
| | Share purchase warrants exercised                                                                       |  | 1.68          |  |  | 999         |  |  | 1,677   |  |  |         |   |  |            |   |  |         |  
| | Warrants issued persuant to Senior Secured
      Notes                                                  |  |               |  |  |            |  |  |        |  |  | 6,617    |   |  |            |   |  |         |  
| | Stock based compensation                                                                                |  |               |  |  |            |  |  |        |  |  |         |   |  | 10,412      |   |  |         |  
| |                                                                                                         |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Options and warrants issued on acquisition
      of Rusaf Gold Limited                                  |  |               |  |  |            |  |  |        |  |  |         |   |  | 1,755       |   |  |         |  
| | Loss for the period                                                                                     |  |               |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (84,433  | )
| | Unrealized loss on available-for-sale
      financial instruments                                       |  |               |  |  |            |  |  |        |  |  |         |   |  |            |   |  |         |  
| | Accumulated unrealized gain on foreign exchange
      translation of self-sustaining foreign operations |  |               |  |  |            |  |  |        |  |  |         |   |  |            |   |  |         |  
| |                                                                                                         |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31, 2008                                                                              |  |               |  |  | 215,166     |  |  | 424,961 |  |  | 22,827   |   |  | 24,258      |   |  | (215,994 | )
| | Equity line: shares issued for cash, net of
      share issue costs                                     |  | 1.37          |  |  | 2,847       |  |  | 3,911   |  |  |         |   |  |            |   |  |         |  
| |                                                                                                         |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Public offering: shares issued for cash,
      net of share issue costs                                 |  | 1.15          |  |  | 115,000     |  |  | 132,700 |  |  | 5,308    |   |  |            |   |  |         |  
| | Options exercised                                                                                       |  | 2.04          |  |  | 1,125       |  |  | 2,294   |  |  |         |   |  | (809        | ) |  |         |  
| | Shares issued for mineral properties                                                                    |  | 1.76          |  |  | 20          |  |  | 35      |  |  |         |   |  |            |   |  |         |  
| | Warrants expired                                                                                        |  | -             |  |  |            |  |  |        |  |  | (16,210  | ) |  | 16,210      |   |  |         |  
| | Future income tax on expired share purchase
      warrants                                              |  |               |  |  |            |  |  |        |  |  |         |   |  | (1,294      | ) |  |         |  
| | Stock-based compensation                                                                                |  | -             |  |  |            |  |  |        |  |  |         |   |  | 12,104      |   |  |         |  
| | Loss for the period                                                                                     |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  | (47,807  | )
| | Unrealized gain on available-for-sale
      financial instruments                                       |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  |         |  
| | Accumulated unrealized loss on foreign exchange
      translation of self-sustaining operations         |  | -             |  |  |            |  |  |        |  |  |         |   |  |            |   |  |         |  
| |                                                                                                         |  |               |  |  |             |  |  |         |  |  |          |   |  |             |   |  |          |  
| | Balance, December 31, 2009                                                                              |  |               |  |  | 334,158     |  |  | 563,901 |  |  | 11,925   |   |  | 50,469      |   |  | (263,801 | )

59

---

|GREAT BASIN GOLD LTD.                               
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|For the years
      ended December 31, 2010 and 2009

|25. | Reconciliation with United States Generally Accepted
      Accounting Principles (continued)
|--- | --------------------------------------------------------------------------------------------

| | (f) | Additional disclosures (continued)                                       
| | --- | -------------------------------------------------------------------------
| |     |                                                                          
| |     | Consolidated statements of change in equity
      (Unaudited) (continued)

| |                                                                                                       |   |               |  |  |             |  |   |         |  |   |          |   |   |             |   |   |          |   |   | Accumulated   |   |   |               |  
| | ----------------------------------------------------------------------------------------------------- | - | ------------- |  |  | ----------- |  | - | ------- |  | - | -------- | - | - | ----------- | - | - | -------- | - | - | ------------- | - | - | ------------- | -
| |                                                                                                       |   | Common Shares |  |  |             |  |   |         |  |   |          |   |   | other       |   |   | Total    |  
| |                                                                                                       |   | Issue         |  |  | Number of   |  |   |         |  |   |          |   |   | Contributed |   |   | Retained |   |   | comprehensive |   |   | shareholders' |  
| |                                                                                                       |   | Price         |  |  | shares      |  |   | Amount  |  |   | Warrants |   |   | surplus     |   |   | deficit  |   |   | income        |   |   | equity        |  
| |                                                                                                       | $ |               |  |  | (thousands) |  | $ | '000    |  | $ | '000     |   | $ | '000        |   | $ | '000     |   | $ | '000          |   | $ | '000          |  
| |                                                                                                       |   |               |  |  |             |  |   |         |  |   |          |   |   |             |   |   |          |   |   |               |   |   |               |  
| | Balance, December 31, 2009                                                                            |   |               |  |  | 334,158     |  |   | 563,901 |  |   | 11,925   |   |   | 50,469      |   |   | (263,801 | ) |   | (24,541       | ) |   | 337,953       |  
| | Options exercised                                                                                     |   | 2.35          |  |  | 6,085       |  |   | 14,308  |  |   |         |   |   | (5,211      | ) |   |         |   |   |              |   |   | 9,097         |  
| | Warrants exercised                                                                                    |   | 1.69          |  |  | 59,504      |  |   | 100,290 |  |   | (5,811   | ) |   |            |   |   |         |   |   |              |   |   | 94,479        |  
| | Shares issued for early settlement of Senior Secured Notes                                            |   | 1.75          |  |  | 2,234       |  |   | 3,910   |  |   |         |   |   |            |   |   |         |   |   |              |   |   | 3,910         |  
| | Shares issued for settlement of Senior
      Secured Notes                                            |   | 2.81          |  |  | 1,461       |  |   | 4,102   |  |   |         |   |   |            |   |   |         |   |   |              |   |   | 4,102         |  
| | Shares issued on settlement of Rusaf contingent payment
      requirement                             |   | 1.82          |  |  | 10,573      |  |   | 19,243  |  |   |         |   |   |            |   |   |         |   |   |              |   |   | 19,243        |  
| | Warrants expired                                                                                      |   |               |  |  |            |  |   |        |  |   | (7       | ) |   | 7           |   |   |         |   |   |              |   |   | -             |  
| | Stock-based compensation                                                                              |   |               |  |  |            |  |   |        |  |   |         |   |   | 7,469       |   |   |         |   |   |              |   |   | 7,469         |  
| | Loss for the period                                                                                   |   |               |  |  |            |  |   |        |  |   |         |   |   |            |   |   | (28,777  | ) |   |              |   |   | (28,777       | )
| | Unrealized gain on available-for-sale financial instruments                                           |   |               |  |  |            |  |   |        |  |   |         |   |   |            |   |   |         |   |   | 603           |   |   | 603           |  
| | Realized gain on available-for-sale
      financial instruments upon transfer                         |   |               |  |  |            |  |   |        |  |   |         |   |   |            |   |   |         |   |   | (1,530        | ) |   | (1,530        | )
| | Accumulated
      unrealized loss on foreign exchange translation of self-sustaining
      operations |   |               |  |  |            |  |   |        |  |   |         |   |   |            |   |   |         |   |   | 27,433        |   |   | 27,433        |  
| |                                                                                                       |   |               |  |  |             |  |   |         |  |   |          |   |   |             |   |   |          |   |   |               |   |   |               |  
| | Balance,
      December 31, 2010                                                                      |   |               |  |  | 414,015     |  |   | 705,754 |  |   | 6,107    |   |   | 52,734      |   |   | (292,578 | ) |   | 1,965         |   |   | 473,982       |  

| | (g) | New US GAAP pronouncements adopted                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     | The FASB issued ASC 810, Consolidations, which
      eliminates the quantitative approach previously required for determining
      the primary beneficiary of a variable interest entity, among other
      changes. This Standard is effective as of the beginning of each reporting
      entitys first annual reporting period that begins after November 15,
      2009. The adoption of this Standard had no impact of the Companys
      financial statements.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | (h) | New US GAAP pronouncement issued but not yet
      adopted                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     | In light of the Companys decision to convert its basis
      of accounting to International Financial Reporting Standards (IFRS) for
      periods beginning on or after January 1, 2011, preparing its first interim
      financial statements in accordance with IFRS for the three month period
      ending March 31, 2011, new US GAAP pronouncements effective from 2011
      onwards will not have an impact on the Companys financial
    statements.    

60

---

|GREAT BASIN GOLD LTD.                             
|--------------------------------------------------
|Consolidated Schedules of Pre-development Expenses
|(Unaudited)                                       

|                                                                       |  |       |  |       | Year ended  |   |   | Year ended  | 
|---------------------------------------------------------------------- |  | ----- |  | ----- | ----------- | - | - | ----------- | 
|Mineral Property Interests                                             |  |       |  |       | December 31 |   |   | December 31 | 
|                                                                       |  | Note  |  |       | 2010        |   |   | 2009        | 
|                                                                       |  |       |  |       | $ '000      |   |   | $ '000      | 
|Burnstone - Pre-development                                            |  |       |  |       |             |   |   |             | 
|Cumulative pre-development expenditures, beginning of year             |  |       |  | $     | 39,174      |   | $ | 39,174      | 
|Cumulative
      pre-development expenditures, end of year             |  |       |  |       | 39,174      |   |   | 39,174      | 
|                                                                       |  |       |  |       |             |   |   |             | 
|Hollister - Pre-development                                            |  |       |  |       |             |   |   |             | 
|Depreciation                                                           |  |       |  |       | 769         |   |   | 1,732       | 
|Property evaluation                                                    |  |       |  |       | (87         | ) |   | 439         | 
|Underground access and infrastructure
      development                |  |       |  |       | 11,160      |   |   | 20,152      | 
|Operational
      costs                                                |  |       |  |       | 1,247       |   |   | 2,487       | 
|Pre-development expenses before the
      following                    |  |       |  |       | 13,089      |   |   | 24,810      | 
|Office and
      administration                                        |  |       |  |       | 308         |   |   | 1,059       | 
|Pre-development expenses incurred during
      the year                |  |       |  |       | 13,397      |   |   | 25,869      | 
|Cumulative
      pre-development expenditures, beginning of year       |  |       |  |       | 82,723      |   |   | 56,854      | 
|Cumulative pre-development expenditures, end of
      year             |  |       |  |       | 96,120      |   |   | 82,723      | 
|                                                                       |  |       |  |       |             |   |   |             | 
|Total pre-development expenses before
      the following              |  |       |  |       | 13,089      |   |   | 24,810      | 
|Office and
      administration                                        |  | 22(b) |  |       | 308         |   |   | 1,059       | 
|Total pre-development expenses incurred
      during the year          |  |       |  |       | 13,397      |   |   | 25,869      | 
|Total cumulative
      pre-development expenditures, beginning of year |  |       |  |       | 121,897     |   |   | 96,028      | 
|Total cumulative pre-development expenditures, end of
      year       |  |       |  | **$** | 135,294     |   | $ | 121,897     | 

See accompanying notes to consolidated financial
statements.

61

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|GREAT BASIN GOLD LTD.                         
|----------------------------------------------
|Consolidated Schedules of Exploration Expenses
|(Unaudited)                                   

|                                                             |   | Year ended  |  |   | Year ended  | 
|------------------------------------------------------------ | - | ----------- |  | - | ----------- | 
|Mineral Property Interests                                   |   | December 31 |  |   | December 31 | 
|                                                             |   | 2010        |  |   | 2009        | 
|                                                             |   | $ '000      |  |   | $ '000      | 
|Burnstone - Exploration                                      |   |             |  |   |             | 
|Assays and analysis                                          | $ | 2           |  | $ | 28          | 
|Drilling                                                     |   | 70          |  |   | 202         | 
|Equipment rental                                             |   |            |  |   | 3           | 
|Geological                                                   |   | 75          |  |   | 64          | 
|Graphics                                                     |   |            |  |   | 1           | 
|Property fees and exploration option
      payments          |   | 12          |  |   |            | 
|Site activities                                              |   | 362         |  |   | 269         | 
|Exploration expenses incurred during the
      year          |   | 521         |  |   | 567         | 
|Cumulative exploration expenditures, beginning of year       |   | 31,610      |  |   | 31,043      | 
|Cumulative exploration expenditures, end of year             |   | 32,131      |  |   | 31,610      | 
|Hollister -
      Exploration                                |   |             |  |   |             | 
|Assays and analysis                                          |   | 126         |  |   | 209         | 
|Drilling                                                     |   | 3,724       |  |   | 6,886       | 
|Engineering                                                  |   |            |  |   | 712         | 
|Environmental,
      socio-economic and land                 |   | 69          |  |   | 1,690       | 
|Freight                                                      |   | 65          |  |   | 190         | 
|General office and
      administration                      |   | 1,324       |  |   | 853         | 
|Geological                                                   |   | 169         |  |   | 150         | 
|Property fees and
      exploration option payments          |   | 108         |  |   | 73          | 
|Site activities                                              |   | 2,619       |  |   | 2,955       | 
|Exploration expenses
      incurred during the year          |   | 8,204       |  |   | 13,718      | 
|Cumulative exploration expenditures, beginning of year       |   | 58,913      |  |   | 45,195      | 
|Cumulative exploration expenditures, end of year             |   | 67,117      |  |   | 58,913      | 
|Rusaf Gold - Exploration                                     |   |             |  |   |             | 
|Assays and analysis                                          |   | 28          |  |   | 331         | 
|Depreciation                                                 |   | 291         |  |   | 299         | 
|Drilling                                                     |   |            |  |   | 11          | 
|Engineering                                                  |   | 2           |  |   | 32          | 
|Freight                                                      |   | 12          |  |   | 86          | 
|Geological                                                   |   | 71          |  |   | 203         | 
|Property fees and
      exploration option payments          |   | 412         |  |   | 445         | 
|Site activities                                              |   | 908         |  |   | 715         | 
|Exploration expenses
      incurred during the year          |   | 1,724       |  |   | 2,122       | 
|Cumulative exploration expenditures, beginning of year       |   | 9,661       |  |   | 7,539       | 
|Cumulative exploration expenditures, end of year             |   | 11,385      |  |   | 9,661       | 
|Other - Exploration                                          |   |             |  |   |             | 
|Depreciation                                                 |   |            |  |   | 14          | 
|Equipment rental                                             |   |            |  |   | 50          | 
|Freight                                                      |   |            |  |   | 3           | 
|Geological                                                   |   |            |  |   | 89          | 
|Property fees and
      exploration option payments          |   |            |  |   | 2           | 
|Site activities and closure                                  |   | 1           |  |   | 27          | 
|Exploration expenses
      incurred during the year          |   | 1           |  |   | 185         | 
|Cumulative exploration expenditures, beginning of year       |   | 4,354       |  |   | 4,169       | 
|Cumulative exploration expenditures, end of year             |   | 4,355       |  |   | 4,354       | 
|                                                             |   |             |  |   |             | 
|Total exploration expenses
      incurred during the year    |   | 10,450      |  |   | 16,592      | 
|Total cumulative exploration expenditures, beginning of year |   | 104,538     |  |   | 87,946      | 
|Total cumulative exploration expenditures, end of
      year | $ | 114,988     |  | $ | 104,538     | 

62

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