---

GREAT BASIN GOLD LTD.

CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED
  DECEMBER 31, 2003, 2002 and 2001

(Expressed in Canadian Dollars, unless otherwise stated)

---

AUDITORS’ REPORT TO THE BOARD OF DIRECTORS OF GREAT
  BASIN GOLD LTD.

We have audited the consolidated balance sheets of Great Basin
  Gold Ltd. as at December 31, 2003 and 2002 and the consolidated statements of
  operations, deficit and cash flows for each of the years in the three year period
  ended December 31, 2003. These financial statements are the responsibility of
  the Company’s management. Our responsibility is to express an opinion
  on these financial statements based on our audits.

We conducted our audits in accordance with Canadian generally
  accepted auditing standards. Those standards require that we plan and perform
  an audit to obtain reasonable assurance whether the financial statements are
  free of material misstatement. An audit includes examining, on a test basis,
  evidence supporting the amounts and disclosures in the financial statements.
  An audit also includes assessing the accounting principles used and significant
  estimates made by management, as well as evaluating the overall financial statement
  presentation.

In our opinion, these consolidated financial statements present
  fairly, in all material respects, the financial position of the Company as at
  December 31, 2003 and 2002 and the results of its operations and its cash flows
  for each of the years in the three year period ended December 31, 2003 in accordance
  with Canadian generally accepted accounting principles.

“KPMG LLP”
  Chartered Accountants

Vancouver, Canada
  April 9, 2004

---

GREAT BASIN GOLD LTD.Consolidated Balance Sheets
  (Expressed in Canadian dollars)

|                                                         |   | As at December
      31 |  
|-------------------------------------------------------- | - | ----------------------- | -
|                                                         |   | 2003                    |  
|                                                         |   |                         |  
|Assets                                                   |   |                         |  
|                                                         |   |                         |  
|Current assets                                           |   |                         |  
|Cash and equivalents                                     | $ | 21,195,145              |  
|Amounts receivable                                       |   | 766,866                 |  
|Prepaid
      expenses (note 7)                          |   | 89,674                  |  
|                                                         |   | 22,051,685              |  
|                                                         |   |                         |  
|Reclamation deposits(note 5(a))                          |   | 81,434                  |  
|Mineral property interests(note
      5)                 |   | 30,668,093              |  
|                                                         |   |                         |  
|                                                         | $ | 52,801,212              |  
|                                                         |   |                         |  
|Liabilities and Shareholders' Equity                     |   |                         |  
|                                                         |   |                         |  
|Current liabilities                                      |   |                         |  
|Accounts payable and
      accrued liabilities           | $ | 818,176                 |  
|                                                         |   |                         |  
|Shareholders' equity                                     |   |                         |  
|Share capital (note
      6)                             |   | 105,492,718             |  
|Contributed surplus
      (note 6(i))                    |   | 2,371,366               |  
|Deficit                                                  |   | (55,881,048             | )
|                                                         |   | 51,983,036              |  
|Nature of operations (note 1)                            |   |                         |  
|Commitments (note 5)                                     |   |                         |  
|Contingencies (note 5(a))                                |   |                         |  
|Subsequent events (note 5(b), 6(c),
      6(d) and 6(h)) |   |                         |  
|                                                         |   |                         |  
|                                                         | $ | 52,801,212              |  

See accompanying notes to consolidated financial statements

|Approved by the Board of Directors |                     
|---------------------------------- | --------------------
|                                   |                     
|                                   |                     
|/s/ Ronald W. Thiessen             | /s/ Jeffrey R. Mason
|                                   |                     
|Ronald W. Thiessen                 | Jeffrey R. Mason    
|Director                           | Director            

---

GREAT BASIN GOLD LTD.Consolidated Statements of Operations
  (Expressed in Canadian dollars)

|                                                             |   | Years ended
      December 31 |  
|------------------------------------------------------------ | - | ----------------------------- | -
|                                                             |   | 2003                          |  
|                                                             |   |                               |  
|Expenses                                                     |   |                               |  
|Conference and travel                                        | $ | 325,504                       |  
|Corporate capital taxes                                      |   | 6,821                         |  
|Depreciation                                                 |   | -                             |  
|Exploration (schedule)                                       |   | 7,927,618                     |  
|Exploration - stock-based
      compensation (note 6(c))     |   | 786,233                       |  
|Financial advisory
      and finders' fees                   |   | 146,578                       |  
|Foreign exchange                                             |   | 532,041                       |  
|Interest and other                                           |   | (935,760                      | )
|Legal, accounting and
      audit                            |   | 272,795                       |  
|Office and administration                                    |   | 877,156                       |  
|Shareholder communications                                   |   | 754,029                       |  
|Stock-based compensation
      (note 6(c))                   |   | 1,345,506                     |  
|Trust
      and filing                                       |   | 203,912                       |  
|Loss before the following:                                   |   | (12,242,433                   | )
|Recovery of accounts
      receivable previously written off |   | 366,500                       |  
|Gain on sale of investments
      (note 5(a))                |   | 4,379,426                     |  
|Write
      down of mineral property interests (note 5(c))   |   | -                             |  
|                                                             |   |                               |  
|Loss for the year                                            | $ | (7,496,507                    | )
|                                                             |   |                               |  
|Basic and diluted loss per share                             | $ | (0.12                         | )
|                                                             |   |                               |  
|Weighted average number of common
      shares outstanding   |   | 60,061,869                    |  
|                                                             |   |                               |  
|Consolidated Statements of Deficit                           |   |                               |  
|(Expressed in Canadian dollars)                              |   |                               |  
|                                                             |   | Years ended
      December 31 |  
|                                                             |   | 2003                          |  
|Deficit, beginning of year                                   | $ | (48,384,541                   | )
|Loss for the year                                            |   | (7,496,507                    | )
|                                                             |   |                               |  
|Deficit, end of the year                                     | $ | (55,881,048                   | )

See accompanying notes to consolidated financial statements

---

GREAT BASIN GOLD LTD.Consolidated Statements of Cash Flows
  (Expressed in Canadian dollars)

|                                                                           |   | Years ended
      December 31 |  
|-------------------------------------------------------------------------- | - | ----------------------------- | -
|                                                                           |   | 2003                          |  
|                                                                           |   |                               |  
|Cash provided by (used for)                                                |   |                               |  
|                                                                           |   |                               |  
|Operating activities                                                       |   |                               |  
|Loss for the year                                                          | $ | (7,496,507                    | )
|Items not involving
      cash                                             |   |                               |  
|Depreciation                                                               |   |                               |  
|Depreciation
      included in exploration expenses                        |   |                               |  
|Stock-based
      compensation expense                                     |   | 2,131,739                     |  
|Write-down
      of mineral property interests                             |   |                               |  
|Changes in non-cash
      operating working capital                        |   |                               |  
|Amounts
      receivable                                                   |   | (581,231                      | )
|Prepaid
      expenses                                                     |   | 580,949                       |  
|Accounts payable and accrued liabilities                                   |   | (1,370,666                    | )
|                                                                           |   | (6,735,716                    | )
|                                                                           |   |                               |  
|Investing activities                                                       |   |                               |  
|Short-term investments                                                     |   | -                             |  
|Reclamation deposits                                                       |   | (73,934                       | )
|Mineral property acquisition costs                                         |   | (8,789,742                    | )
|                                                                           |   | (8,863,676                    | )
|                                                                           |   |                               |  
|Financing activities                                                       |   |                               |  
|Common shares and
      warrants issued for cash,                          |   |                               |  
|net of issue costs                                                         |   | 22,304,900                    |  
|                                                                           |   |                               |  
|Increase in cash and equivalents                                           |   | 6,705,508                     |  
|Cash and equivalents, beginning of
      year                              |   | 14,489,637                    |  
|                                                                           |   |                               |  
|Cash and equivalents, end of year                                          | $ | 21,195,145                    |  
|                                                                           |   |                               |  
|Supplementary information                                                  |   |                               |  
|Taxes paid                                                                 | $ | -                             |  
|Non-cash financing
      and investing activities                          |   |                               |  
|Shares and warrants
      issued for property option agreement (note 5(b)) | $ | 16,000,000                    |  
|Warrants issued in
      connection with mineral property agreement        | $ |                              |  
|Warrants received
      in connection with mineral property agreement      | $ |                              |  
|Fair value of stock
      options allocated to shares issued on exercise   | $ | 430,000                       |  

---

GREAT BASIN GOLD LTD.Consolidated Schedules of Exploration Expenses
  (Expressed in Canadian Dollars)

|                                                    |   | Burnstone  |  |   | Ivanhoe    |   |   | Other   |   |   | Total      |  
|--------------------------------------------------- | - | ---------- |  | - | ---------- | - | - | ------- | - | - | ---------- | -
|                                                    |   |            |  |   |            |   |   |         |   |   |            |  
|Exploration expenses during 2003                    |   |            |  |   |            |   |   |         |   |   |            |  
|Assays and analysis                                 | $ | 183,350    |  | $ | 2,746      |   | $ |        |   | $ | 186,096    |  
|Drilling                                            |   | 4,920,811  |  |   | 5,317      |   |   |        |   |   | 4,926,128  |  
|Engineering                                         |   | 463,576    |  |   | 27,413     |   |   |        |   |   | 490,989    |  
|Environmental, socio-economic
      and land        |   | 17,235     |  |   | 86,836     |   |   |        |   |   | 104,071    |  
|Geological                                          |   | 1,308,197  |  |   | 63,159     |   |   |        |   |   | 1,371,356  |  
|Graphics                                            |   | 36,944     |  |   | 3,435      |   |   |        |   |   | 40,379     |  
|Property fees and
      exploration option payments |   | 19,374     |  |   | 263,292    |   |   | 1,454   |   |   | 284,120    |  
|Site activities                                     |   | 269,496    |  |   | 39,696     |   |   | 495     |   |   | 309,687    |  
|Transportation                                      |   | 193,958    |  |   | 20,834     |   |   |        |   |   | 214,792    |  
|                                                    |   | 7,412,941  |  |   | 512,728    |   |   | 1,949   |   |   | 7,927,618  |  
|Stock-based compensation (note 6(c))                |   | 735,189    |  |   | 50,851     |   |   | 193     |   |   | 786,233    |  
|Incurred during 2003                                |   | 8,148,130  |  |   | 563,579    |   |   | 2,142   |   |   | 8,713,851  |  
|Cumulative expenditures, December 31,
      2002    |   | 2,590,826  |  |   | 21,534,769 |   |   | (30,042 | ) |   | 24,095,553 |  
|Cumulative expenditures, December
      31, 2003    | $ | 10,738,956 |  | $ | 22,098,348 |   | $ | (27,900 | ) | $ | 32,809,404 |  
|                                                    |   |            |  |   |            |   |   |         |   |   |            |  
|Exploration expenses during 2002                    |   |            |  |   |            |   |   |         |   |   |            |  
|Assays and analysis                                 | $ | 215        |  | $ | 897        |   | $ |        |   | $ | 1,112      |  
|Drilling                                            |   |           |  |   | 4,241      |   |   |        |   |   | 4,241      |  
|Engineering                                         |   | 156,603    |  |   | 90,086     |   |   |        |   |   | 246,689    |  
|Environmental, socio-economic
      and land fees   |   | 14,464     |  |   | 314,108    |   |   | 537     |   |   | 329,109    |  
|Equipment rentals
      and leases                  |   | 1,609      |  |   | 7,469      |   |   |        |   |   | 9,078      |  
|Exploration option
      payments                   |   | 2,094,760  |  |   |           |   |   |        |   |   | 2,094,760  |  
|Exploration option
      payments received          |   |           |  |   |           |   |   | (50,000 | ) |   | (50,000    | )
|Geological                                          |   | 189,292    |  |   | 125,741    |   |   |        |   |   | 315,033    |  
|Graphics                                            |   | 3,033      |  |   | 32,516     |   |   |        |   |   | 35,549     |  
|Reclamation                                         |   |           |  |   | 83,288     |   |   |        |   |   | 83,288     |  
|Site activities                                     |   | 46,963     |  |   | 78,096     |   |   |        |   |   | 125,059    |  
|Transportation                                      |   | 13,926     |  |   | 27,793     |   |   |        |   |   | 41,719     |  
|                                                    |   | 2,520,865  |  |   | 764,235    |   |   | (49,463 | ) |   | 3,235,637  |  
|Stock-based compensation (note 6(c))                |   | 69,961     |  |   | 64,787     |   |   |        |   |   | 134,748    |  
|Incurred during 2002                                |   | 2,590,826  |  |   | 829,022    |   |   | (49,463 | ) |   | 3,370,385  |  
|Cumulative expenditures, December 31,
      2001    |   |           |  |   | 20,705,747 |   |   | 19,421  |   |   | 20,725,168 |  
|Cumulative expenditures, December
      31, 2002    | $ | 2,590,826  |  | $ | 21,534,769 |   | $ | (30,042 | ) | $ | 24,095,553 |  
|                                                    |   |            |  |   |            |   |   |         |   |   |            |  
|Exploration expenses during 2001                    |   |            |  |   |            |   |   |         |   |   |            |  
|Assays and analysis                                 | $ |           |  | $ | 159,672    |   | $ | 517     |   | $ | 160,189    |  
|Depreciation                                        |   |           |  |   | 12,504     |   |   |        |   |   | 12,504     |  
|Drilling                                            |   |           |  |   | 1,155,733  |   |   |        |   |   | 1,155,733  |  
|Engineering                                         |   |           |  |   | 121,935    |   |   |        |   |   | 121,935    |  
|Environmental, socio-economic
      and land fees   |   |           |  |   | 357,784    |   |   | 11,389  |   |   | 369,173    |  
|Equipment rentals
      and leases                  |   |           |  |   | (12,278    | ) |   |        |   |   | (12,278    | )
|Geological                                          |   |           |  |   | 775,396    |   |   |        |   |   | 775,396    |  
|Site activities                                     |   |           |  |   | 201,421    |   |   |        |   |   | 201,421    |  
|Transportation                                      |   |           |  |   | 93,001     |   |   |        |   |   | 93,001     |  
|Incurred during 2001                                |   |           |  |   | 2,865,168  |   |   | 11,906  |   |   | 2,877,074  |  
|Cumulative expenditures, December 31,
      2000    |   |           |  |   | 17,840,579 |   |   | 7,515   |   |   | 17,848,094 |  
|Cumulative expenditures, December
      31, 2001    | $ |           |  | $ | 20,705,747 |   | $ | 19,421  |   | $ | 20,725,168 |  

See accompanying notes to consolidated financial statements

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|1. | Nature of operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | Great Basin Gold Ltd. ("Great Basin" or the "Company")
        was incorporated under the laws of the Province of British Columbia and
        its principal business activity is the exploration of mineral property
        interests. The Company's principal mineral property interests are the
        Ivanhoe Property located in Nevada, United States of America, and the
        Burnstone Gold Property located in the Republic of South Africa (note
        5).                                                                                                                                                                                                                                                                                                                                                                     
|  
|   | The Company is in the process of exploring its mineral
        property interests and has not yet determined whether its mineral property
        interests contain economically recoverable mineral reserves. The underlying
        value and the recoverability of the amounts shown for mineral property
        interests are entirely dependent upon the existence of economically recoverable
        mineral reserves, the ability of the Company to obtain the necessary financing
        to complete the exploration and development of the mineral property interests,
        completion of the Company's obligations under agreements to acquire the
        Company's interest in the underlying mineral properties, and future profitable
        production or proceeds from the disposition of the mineral property interests.
|  
|2. | Basis of presentation and principles of consolidation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|   | These financial statements have been prepared in
        accordance with Canadian generally accepted accounting principles ("GAAP").
        The results of applying measurement accounting principles generally accepted
        in the United States are set out in note 10.
        These consolidated financial statements include the accounts of the
          Company and its wholly-owned subsidiaries. All material intercompany
          balances and transactions have been eliminated.                                                                                                                                                                                                                                                                                                                                             
|  
|3. | Significant accounting policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  

|(a) | Cash and equivalents                                                                                                                                                                                                                                         
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    | Cash and 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.                               
|   
|(b) | Short-term investments                                                                                                                                                                                                                                       
|   
|    | Short-term investments include highly liquid investments
        with terms to maturity of three to twelve months when purchased. Short-term
        investments are carried at the lower of cost plus accrued interest and
        quoted fair market value.
|   
|(c) | Reclamation deposits                                                                                                                                                                                                                                         
|   
|    | Reclamation deposits are recorded at cost.                                                                                                                                                                                                                   
|   
|(d) | Investments                                                                                                                                                                                                                                                  
|   
|    | Investments capable of reasonably prompt liquidation
        are carried at the lower of cost and quoted market value. Investments
        where the Company has the ability to exercise significant influence are                                           

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|    | accounted for on the equity basis where the investment
        is initially recorded at cost and subsequently adjusted for the Company's
        share of the income or loss and capital transactions of the investee,
        less provision, if any, for permanent impairment in value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(e) | Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|    | Equipment is stated at cost less accumulated depreciation.
        Depreciation is provided on a straight-line basis over three to five years,
        which represents the estimated useful lives of the related equipment.
        Depreciation on equipment used directly on exploration projects is included
        in exploration expenses until the related property is placed into production.                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   
|(f) | Mineral property interests                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|    | Exploration expenses incurred prior to determination
        of the feasibility of mining operations, periodic option payments and
        administrative expenditures are expensed as incurred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    | Mineral property acquisition costs and exploration
        and development expenditures incurred subsequent to the determination
        of the feasibility of mining operations are deferred until the property
        to which they relate is placed into production, sold, allowed to lapse
        or abandoned. Mineral property acquisition costs include the cash consideration
        and the fair value of common shares and warrants issued for mineral property
        interests, pursuant to the terms of the relevant agreement. These costs
        are amortized over the estimated life of the property following commencement
        of commercial production, or written off if the property is sold, allowed
        to lapse or abandoned, or when an impairment in value has been determined
        to have occurred.
|   
|(g) | Share capital                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|    | The Company records proceeds from share issuances
        net of issue costs. Shares issued for consideration other than cash are
        valued at the quoted market price on the date the agreement to issue the
        shares was reached.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   
|(h) | Foreign currency translation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   
|    | All of the Company's foreign operations are considered
        integrated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|    | Monetary assets and liabilities of the Company and
        its integrated foreign operations are translated into Canadian dollars
        at exchange rates in effect at the balance sheet date. Non-monetary assets
        and liabilities are translated at historical exchange rates unless such
        items are carried at market, in which case they are translated at the
        exchange rates in effect on the balance sheet date. Revenues and expenses,
        except depreciation, are translated at the average exchange rates for
        the period. Depreciation is translated at the same exchange rate as the
        assets to which it relates. Gains or losses on translation are recorded
        in the statement of operations.                                                                                    

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|(i) | 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.                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|(j) | Fair value of financial instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|    | The carrying amounts of cash and equivalents, amounts
        receivable, reclamation deposits, and accounts payable and accrued liabilities
        approximate fair value due to their short term nature. The quoted market
        value of the warrants received from Hecla Mining Company is disclosed
        in note 5(a). Fair value estimates are made at the date of issuance, and
        at the balance sheet date, based on relevant market information and information
        about the financial instruments.                                                                                                                                                                                                                                                                                                                          
|   
|(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 and disclosure of contingent assets
        and liabilities at the date of the financial statements and the reported
        amounts of revenues and expenses during the reporting period. Significant
        areas requiring the use of management estimates relate to the impairment
        of mineral property interests, determination of reclamation obligations
        and rates for depreciation, as well as the assumptions used in determining
        the fair value of non-cash stock-based compensation and warrants. Actual
        results could differ from these estimates.                                                                                
|   
|(l) | Segment disclosures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|    | The Company operates in a single segment, being
        exploration of mineral properties, within the geographic areas disclosed
        in note 9. Other than exploration expenses and mineral property acquisition
        costs, which are disclosed in the schedule and in note 5 respectively,
        substantially all of the Company's net expenses are incurred in Canada.                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|(m) | Stock-based compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    | The Company has a share option plan which is described
        in note 6(c). Effective January 1, 2003, the Company adopted the amended
        recommendations of the Canadian Institute of Chartered Accountants ("CICA")
        with respect to employee stock-based compensation. As allowed under the
        transitional provisions, the amended recommendations have been applied
        prospectively to option grants after that date. As a result, the Company
        records all stock-based payments granted on or after January 1, 2003 using
        the fair value method. In 2002, the Company accounted for stock-based
        compensation to employees by the settlement method whereby no compensation
        expense was recorded for options granted, when options were granted at
        the quoted market value. Options

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|    | granted to non-employees
        in 2002 were accounted for using the fair value method. Prior to 2002,
        all stock-based compensation was accounted for using the settlement method.
        The impact of the prospective change in accounting on the year ended December
        31, 2003 is disclosed in note 6(c). If this policy had been adopted in
        the prior year the effect would have been to increase the loss for the
        year by $1,204,997.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | Under the fair
        value method, stock-based payments are measured at the fair value of the
        consideration received or the fair value of the equity instruments issued,
        whichever is more reliably measurable and are charged to operations over
        the vesting period. The offset to the recorded costs is to contributed
        surplus. Consideration received on the exercise of stock options is recorded
        as share capital and the related contributed surplus is transferred to
        share capital.                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|   
|   
|   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(n) | 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, generally 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. Future income tax assets also result from
        unused loss carry forwards and other deductions. Future  tax assets
        are recognized to the extent that they are considered more likely than
        not to be realized. The valuation of future income tax assets is adjusted,
        if necessary, by the use of a valuation allowance to reflect the estimated
        realizable amount.
|   
|   
|   
|   
|   
|   
|   
|   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(o) | Comparative figures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | Certain of the
        prior years' comparative figures have been restated to conform with the
        presentation adopted for the current year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4.  | Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

| |           |   | December 31, 2003 |  |   | December 31, 2002 | 
| | --------- | - | ----------------- |  | - | ----------------- | 
| |           |   |                   |  |   | Accumulated       | 
| | Equipment |   | Cost              |  |   | depreciation      | 
| | Computer  | $ | 127,795           |  | $ | 127,795           | 
| | Field     |   | 349,631           |  |   | 349,631           | 
| | Office    |   | 300,678           |  |   | 300,678           | 
| |           | $ | 778,104           |  | $ | 778,104           | 

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|5. | Mineral property interests
|-- | --------------------------

| |                                               |   | December 31, |  |   | December 31, | 
| | --------------------------------------------- | - | ------------ |  | - | ------------ | 
| | Mineral Property Acquisition Costs,
      net |   | 2003         |  |   | 2002         | 
| |                                               |   |              |  |   |              | 
| | Ivanhoe Property (note 5(a))                  | $ | 3,945,348    |  | $ | 5,878,348    | 
| | Burnstone Gold Property (note 5(b))           |   | 26,722,743   |  |   | 1            | 
| | Casino Property (note 5(c))                   |   | 1            |  |   | 1            | 
| | Kirkland Lake Property (note 5(d))            |   | 1            |  |   | 1            | 
| | Bissett Creek Property (note 5(e))            |   |             |  |   |             | 
| |                                               |   |              |  |   |              | 
| |                                               | $ | 30,668,093   |  | $ | 5,878,351    | 

|(a) | Ivanhoe Property                             
|--- | ---------------------------------------------
|    |                                              
|    | Elko County, Nevada, United States of America

| |                                                       |   | December 31, |   |   | December 31, |  
| | ----------------------------------------------------- | - | ------------ | - | - | ------------ | -
| |                                                       |   | 2003         |   |   | 2002         |  
| | Ivanhoe Property                                      |   |              |   |   |              |  
| | Balance, beginning
      of the period                | $ | 3,945,348    |   | $ | 5,583,348    |  
| | Incurred during the
      period                      |   |             |   |   | 295,000      |  
| | Estimated
      fair value of Hecla Warrants received |   |             |   |   | (1,933,000   | )
| | Balance,
      end of the period                      |   | 3,945,348    |   |   | 3,945,348    |  
| |                                                       |   |              |   |   |              |  
| | Hecla Warrants                                        |   |              |   |   |              |  
| | Balance, beginning
      of the period                |   | 1,933,000    |   |   |             |  
| | Exercise of Hecla Warrants                            |   | (1,933,000   | ) |   |             |  
| | Estimated
      fair value of Hecla Warrants received |   |             |   |   | 1,933,000    |  
| | Balance,
      end of the period                      |   |             |   |   | 1,933,000    |  
| |                                                       |   |              |   |   |              |  
| | Ivanhoe Property                                      | $ | 3,945,348    |   | $ | 5,878,348    |  

| | On August 13, 1997, the Company and Cornucopia
        Resources Ltd. (now Quest Investment Corporation, formerly Stockscape.com
        Technologies Inc.) ("Cornucopia") entered into an agreement to acquire
        a 100% working interest in the Ivanhoe Property on the Carlin Trend in
        Nevada from Newmont Exploration Limited ("Newmont").                                                                                                                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | Pursuant to the terms of the agreement,
        the Company earned a 75% interest in the Ivanhoe Property in consideration
        for payments totalling US$5.0 million, while Cornucopia acquired the remaining
        25% interest. The agreement provided that exploration and related costs
        include 150% of any amounts paid by the Company on behalf of Cornucopia
        pursuant to Cornucopia's reclamation obligations under the agreement.
        Newmont has managed and will continue to manage and complete an approved
        mine closure plan of the 1.1 square mile area of former mining operations
        already funded by US$4.5 million. The agreement also provided that overruns
        will be funded 33%

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| | each by Newmont, the Company
        and Cornucopia up to a total overrun of US$1.5 million, and thereafter
        75% by Newmont, with the balance payable pro rata by the Company and Cornucopia.
        Ownership of, and further expenditures on, the Ivanhoe Property were to
        be on a 75% Company and 25% Cornucopia basis, but was amended as per below.                                                    
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                             
| | On March 2, 1999, the Company
        entered into an agreement to acquire the 25% interest in the Ivanhoe Property
        owned by Touchstone Resources Ltd. ("Touchstone"), a wholly-owned subsidiary
        of Cornucopia. In addition, the Company assumed Cornucopia's reclamation
        obligations with respect to the Ivanhoe Property.                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                             
| | During 1998, the Company
        entered into an agreement for a group of claims that form part of the
        Ivanhoe Property. This agreement with a term of up to four 20 year terms,
        provides for annual advance royalty payments of US$50,000 per year until
        2017 and increases to US$55,000 in years 2018 to 2037. The claims are
        subject to net smelter return ("NSR") royalties of 2% to 5%.
| |                                                                                                                                                                                                                                                                                                                                                                                                                             
| | During 1999, cumulative
        reclamation expenditures exceeded US$6,000,000 and as required by the
        agreement, the Company contributed 25% of the excess from 1999 to 2003.
        Newmont has advised that in order to complete the reclamation, the following
        property reclamation costs are budgeted over the next two years:                                                                         

|     |  | Total Reclamation |  | The Company's 25%
|---- |  | ----------------- |  | -----------------
|Year |  | Costs             |  | Share            
|2004 |  | US$     25,042    |  | US$     6,260    
|2005 |  | 161,042           |  | 40,261           
|     |  | US$ 186,084       |  | US$ 46,521       

| | During 2000, 2001 and 2002,
        US$51,992, US$19,828 and US$4,996 respectively was paid to Newmont for
        the Company's 25% share of actual reclamation costs incurred. US$52,781
        ($83,288) was accrued at December 31, 2002 and was included in current
        liabilities. US$909 was paid to Newmont during the twelve months ended
        December 31, 2003 for the Company's 25% share of actual reclamation costs
        incurred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | In July 2001, the Company
        entered into an agreement to acquire sixty-five unpatented lode mining
        claims for US$50,000 ($75,745) and subsequently paid the full amount.
        The claims adjoin the northwest corner of the Ivanhoe Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | On June 10, 2002, the Company
        entered into a letter agreement with Hecla Mining Company concerning exploration,
        development and production on the Company's Ivanhoe property and on August
        2, 2002, the formal Earn-in and Joint Operating Agreements were signed
        with Hecla Ventures Corp. ("Hecla"), an affiliate of Hecla Mining Company.
        These agreements provide that Hecla will vest in a 50% working interest
        in the Hollister Development Block, which is a portion of the Ivanhoe
        Property, subject to a purchase royalty in favor of Great Basin, provided
        that Hecla funds a US$21.8 million two-stage advanced exploration and
        development program, or otherwise achieves commercial production, and
        issues 4 million Hecla Mining Company share purchase warrants (the "Hecla
        Warrants") to Great Basin (2 million share purchase warrants exercisable
        at US$3.73 per share expiring on August 2, 2004 have been issued to December
        31, 2003).

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| | Using an option pricing
        model, the fair value of the issued Hecla Warrants on the agreement date
        was estimated to be $1,933,000, based on the August 2, 2002 closing price
        of Hecla Mining Company shares of US$3.41 on the New York Stock Exchange
        ("NYSE") (also based on the following assumptions: risk free interest
        rate of 3%; expected life of 2 years; expected volatility of 25% and expected
        dividends of nil), and is included in Mineral Property Interests. The
        Hecla Warrants are not listed on a public stock exchange. Any proceeds
        received on the sale of Hecla Warrants, or the sale of shares of Hecla
        Mining Company received on exercise of the Hecla Warrants, will be credited
        against the total cost, including this amount, when realized. The Hecla
        Warrants were exercised during 2003. The proceeds totalling $6,312,426
        received on the sale of the shares of Hecla Mining Company, which were
        received on the exercise of the Hecla Warrants, resulted in a gain of
        $4,379,426.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | Concurrent with and in proportion
        to the Hecla Warrants, the Company agreed to issue 2 million share purchase
        warrants (the "Great Basin Warrants") to Hecla (1 million share purchase
        warrants exercisable at Cdn$1.55 per share expiring on August 2, 2004
        have been issued to December 31, 2003) (note 6(d)). The fair value of
        the issued Great Basin Warrants on the agreement date was estimated to
        be $295,000 (based on the same assumptions stated in note 6(c)) and has
        been included in the cost of the Ivanhoe Property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | Hecla has commenced engineering
        and permitting work to facilitate an underground development program.
        Upon receipt of applicable permits, Hecla is expected to complete the
        Stage 1 underground development, drilling, and pre-feasibility program
        estimated in the Earn-in Agreement at US$10.3 million, in approximately
        12 months. To vest its 50% working interest, Hecla must, upon completion
        of Stage 1, proceed to Stage 2 within 60 days. The Stage 2 program of
        US$11.5 million is expected to be completed over the ensuing 12 months
        and consists of underground production development and procurement of
        production equipment and surface facilities, with an overall goal to essentially
        develop the Hollister Development Block to the point of commercial production.
        Hecla will be the operator of the Stage 1 and Stage 2 work programs, and
        will continue as the operator should a positive production decision be
        made.                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | A sliding scale Purchase
        Price Royalty on Hecla's share of production is payable in cash or in
        kind by Hecla to Great Basin. At a cash operating profit per ounce of
        gold equivalent in the range of US$100-200 per ounce, the royalty is equal
        to US$50 per ounce. The Royalty will be payable by Hecla commencing at
        the point it has recovered 115% of its Stage 1 and 2 pre-production expenditures.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | As at December 31, 2003,
        the Company has posted a total of US$53,800 in reclamation deposits with
        the Bureau of Land Management ("BLM") comprised of US$41,200 ($64,244)
        posted in February 2003, US$9,600 ($12,690) posted in November 2003, and
        US$3,000 ($4,500) posted in previous periods, in respect of exploration
        drilling on certain areas of the Ivanhoe Property. These reclamation deposits
        will be released by the BLM upon the conclusion of the exploration and
        related reclamation programs on these areas.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | On August 26, 2003, the
        Company entered into an agreement with Atna Resources Ltd. ("Atna") to
        acquire a 70% interest in Atna's Golden Cloud Property, located in Elko
        County, Nevada. The Golden Cloud Property is contiguous with the southern
        boundary of the Ivanhoe claim block.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|    | The Company can earn a 70% interest in the property
        by spending US$2,500,000 on exploration and development over five years,
        including a minimum of 30,000 feet of drilling, making cash payments totalling
        US$400,000 to Atna, of which US$20,000 was paid during the year ended
        December 31, 2003, and by assuming underlying option and property maintenance
        payments. Upon fulfilling the earn-in requirements, the Company and Atna
        have agreed to form a joint venture for further exploration and development
        of the property.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) | Burnstone Gold Property                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|    | Republic of South Africa                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

| |                                                               |   | December 31, |  |   | December 31, | 
| | ------------------------------------------------------------- | - | ------------ |  | - | ------------ | 
| |                                                               |   | 2003         |  |   | 2002         | 
| | Burnstone Gold Property                                       |   |              |  |   |              | 
| | Exercise of tranche
      one for Southgold                   | $ | 20,027,145   |  | $ | 1            | 
| | Acquisition
      costs of mineral rights from GFL and Randex |   | 6,695,598    |  |   |             | 
| | Burnstone Gold Property                                       | $ | 26,722,743   |  |   | 1            | 

| | On November 5, 2002, the
        Company entered into an option agreement ("the Option Agreement") with
        a private South African company, Southgold Exploration (Proprietary) Limited
        ("Southgold"), and its shareholders, to acquire on a staged basis up to
        100% of Southgold. Southgold has the right to acquire an 100% interest
        in the Burnstone Gold Property covering approximately 265 square kilometres
        of the Witwatersrand goldfield in the Republic of South Africa ("RSA"),
        subject to a statutorily mandated Historically Disadvantaged South Africans
        ("HDSA") Ownership Target ranging from 15% to 26%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | Prior to November 2002,
        Southgold entered into a joint venture agreement with Tranter Investments
        (Proprietary) Limited ("Tranter"), an HDSA partner, whereby Tranter was
        granted an option, exercisable on completion of a Bankable Feasibility
        Study, to acquire a 20% participating interest in the Burnstone project
        by refunding 20% of historic costs to that exercise date. Tranter would
        thereafter maintain its 20% participating joint venture interest by funding
        its pro-rata share of all development, construction and property costs
        after the completion of a Bankable Feasibility Study. Tranter would also
        have the right, subject to certain conditions, to purchase on commercial
        terms an additional 6% participation interest in the Burnstone Joint Venture.
        This joint venture agreement was subject to the satisfaction of certain
        conditions by March 31 2003, which in the event were not met and the agreement
        expired. The Company, Southgold, and Tranter are however, working together
        to extend or modify the agreement on mutually acceptable terms and conditions.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | Upon signing the Option
        Agreement in November 2002, the Company paid US$1.25 million ($2,007,561)
        for the right to acquire the option and to explore the Burnstone Gold
        Property and also agreed to conduct a US$1.5 million work program prior
        to April 30, 2003 (which was undertaken and completed). Pursuant to the
        Option Agreement, the Company can exercise its option and complete the
        purchase of Southgold by making cash and Great Basin share and share purchase
        warrant payments to Southgold's shareholders in two staged tranches, totalling
        US$2 million, 21                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| | million Great Basin shares
        and 10.5 million Great Basin share purchase warrants exercisable at US$0.75
        for one year from the date of issuance. The share purchase warrants will
        be subject to a 45-day accelerated expiry in the event that Great Basin's
        common shares trade on The Toronto Stock Exchange over a 20-day weighted
        average per share price equal to or greater than US$1.50 per common share.                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | On April 30, 2003, the Company
        exercised tranche one and acquired the right to 49% of the outstanding
        common shares of Southgold for payments totalling US$2 million cash and
        the issuance of 10 million Great Basin common shares and 5 million Great
        Basin share purchase warrants. A finder's fee of approximately 2% was
        payable, to a maximum of US$1 million, as the Company acquired Southgold
        and made expenditures on the Burnstone Gold Property. This finder's fee
        was paid and is included in acquisition costs.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | As Southgold had no assets
        or liabilities other than its interest in the Burnstone Gold Property,
        the exercise of tranche one was accounted for as follows:                                                                                                                                                                                                                                                                                                                                                                                                         

|Issuance of 10 million common shares          | $ | 13,800,000 | 
|--------------------------------------------- | - | ---------- | 
|Issuance of 5 million share purchase warrants |   | 2,200,000  | 
|Cash                                          |   | 2,768,990  | 
|Finders' fees                                 |   | 1,258,155  | 
|Acquisition of mineral property interests     | $ | 20,027,145 | 

| | On January 31, 2004, subsequent
        to the year end, the Company exercised tranche two and issued 11 million
        common shares and 5.5 million share purchase warrants, which resulted
        in the Company completing the acquisition of 100% of Southgold. All Great
        Basin shares issued to Southgold shareholders are subject to a voting
        trust agreement, whereby the holders undertake to vote with Great Basin
        management for a period of five years. Additional shares may become issuable
        by Great Basin to Southgold's shareholders depending on certain outcomes
        with respect to the Bankable Feasibility Study, such as the quantity of
        gold reserves, gold production costs, and the actual cost of the study.                                                                                                                                                                                                                                                                                                                                                                                       
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | On October 10, 2003, pursuant
        to a Prospecting Agreement between GFL Mining Services Limited ("GFL"),
        Randex Limited ("Randex"), and Southgold, Southgold elected to purchase
        certain mineral rights held by GFL and Randex totalling 11,563 hectares
        within the Burnstone Gold Property which were not covered under Southgold's
        then-existing rights, for 35,000,000 South African Rand ("ZAR") ($6,695,598).
        The Company funded Southgold's purchase of these rights by way of a cash
        payment. Additional consideration for the purchase of these mineral rights
        consists of a net smelter royalty, ranging from 1% to 2% (tiered to the
        gold price), payable to GFL. Current draft South African legislation proposes
        the abolition of private mineral title and, by extension, private royalties.
        Under the Prospecting Agreement, in the event of a change in the mineral
        rights regime in South Africa, the parties agreed to negotiate adaptations
        to the Prospecting Agreement, if possible without causing undue hardship
        to each of the parties.

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|(c) | Casino Property                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | Whitehorse Mining District, Yukon, Canada                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|    | The Company owns a group of 161 mineral claims,
        some of which are subject to a 5% net profits from production royalty.
        During May 2000, the Company granted an option whereby Wildrose Resources
        Ltd., the optionee, could earn the right to purchase 55 claims for $1
        on the 20th anniversary of the option agreement. As consideration, the
        optionee has agreed to incur all annual filing fees and assessment work
        on the 55 claims under option and 83 other claims. Alternatively, the
        optionee may purchase the 55 claims for a one time payment of $200,000
        without further obligation in respect of the Company's 83 claims. Should
        the optionee acquire the 55 claims, the optionee would be subject to a
        further 5% net profits interest, payable to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|    | During fiscal 2001, the acquisition costs associated
        with the Casino Property were written down to a nominal amount to reflect
        the Company's intention to defer work on the property pending a sustained
        recovery in metal prices.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    | On July 15, 2002, the Company agreed to option the
        Casino property (the "Property") to CRS Copper Resources Ltd. ("CRS"),
        subject to existing net profits royalty agreements and the Wildrose option
        agreement on a portion of the Casino property. Under the terms of the
        agreement, Great Basin granted CRS an option ("the Option") to purchase
        100% of Great Basin's interest in the claims and interests comprising
        the Property for $1,000,000, plus applicable taxes, payable at the option
        of CRS in cash or CRS common shares, provided that CRS shares are listed
        on a recognized stock exchange and have certain minimum trading volumes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|    | The Option may be exercised at any time from the
        date of the agreement to July 15, 2007, subject to written notice and
        confirmation that the terms of the Option have been met. If CRS elects
        to terminate the agreement without exercising the Option or allows it
        to lapse, CRS must pay to Great Basin a "break fee" of $25,000, plus applicable
        taxes. CRS was required to make interim option payments to Great Basin
        at the time that CRS is listed on an exchange, of warrants to purchase
        100,000 shares for a period of two years at an exercise price which reflects
        the maximum discount for the prevailing CRS market price permitted by
        the policies of the exchange. CRS will issue a further such warrants on
        each anniversary date thereafter to a maximum of warrants to purchase
        300,000 CRS shares. If CRS was not listed by December 31, 2002, CRS was
        obligated to pay to Great Basin $50,000 plus applicable taxes, in lieu
        of the warrants, to keep the Option in good standing. This CRS option
        payment was received by the Company in December 2002. In June 2003, CRS
        listed on the TSX Venture Exchange under the name Lumina Copper Corp.
        Accordingly, the Company received warrants to purchase 100,000 shares
        at an exercise price of $1.80 until May 23, 2005. These warrants were
        exercised by the Company in October 2003 and the related shares were then
        sold.
|   
|    | CRS has the right to conduct exploration work on
        or in respect of the Property at its cost, or to make payments in lieu
        to keep the Property in good standing during the period of the Option.
        If the Option is not exercised and is terminated, CRS is required to pay
        Property holding costs for a minimum period of two years from the effective
        date of termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|    | In the event
        the Option is exercised and a decision is made to put the Property into
        commercial production, CRS will pay to Great Basin $1,000,000 in cash,
        plus applicable taxes, within 30 days of that decision.                                                                                                                                                                                                      
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(d) | Kirkland Lake Property                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Ontario, Canada                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | In 1992, the
        future economic benefit of the Kirkland Lake property became uncertain,
        and while the property was not abandoned, there were no plans or financial
        resources to make further significant expenditures on the property. Accordingly,
        the property was written down to $1.                                                                                                                            
|   
|   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | The Company continues to
        maintain the Kirkland Lake property in good standing.                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(e) | Bissett Creek Property                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Ontario, Canada                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | In 1992, the
        future economic benefit of the Bissett Creek graphite property became
        uncertain. While not abandoned, there were no plans or financial resources
        to make further significant expenditures on the property. Accordingly,
        the property costs were written down to $1. In December 2001, the property
        was returned to the original owner and the balance of the costs were written
        off.
|   
|   
|   
|   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|6.  | Share capital                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(a) | Authorized share capital                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | The Company's
        authorized share capital consists of 200,000,000 common shares without
        par value.                                                                                                                                                                                                                                                                                                                                  
|   

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|(b) | Issued and outstanding common shares
|--- | ------------------------------------

| |                                                                       | Number of  |  |   |             |  
| | --------------------------------------------------------------------- | ---------- |  | - | ----------- | -
| |                                                                       | Shares     |  |   | Amount      |  
| | Balance, December 31, 2000                                            | 38,182,137 |  | $ | 55,984,660  |  
| | Additional
      share issue costs from prior financing               |           |  |   | (31,245     | )
| | Balance, December 31, 2001                                            | 38,182,137 |  |   | 55,953,415  |  
| | Issued during 2002:                                                   |            |  |   |             |  
| | Share purchase options
      exercised (note 6(c))                    | 179,900    |  |   | 156,018     |  
| | Share purchase warrants
      exercised (note 6(e))                   | 2,007,000  |  |   | 2,007,000   |  
| | Agent's share purchase
      options exercised (note 6(e))            | 500,000    |  |   | 500,000     |  
| | Agent's share purchase
      warrants exercised (note 6(e))           | 250,000    |  |   | 250,000     |  
| | Private placement,
      May 2002, net of issue costs (note 6(f))     | 5,616,612  |  |   | 7,700,570   |  
| | Private
      placement, August 2002, net of issue costs (note 6(g))  | 125,715    |  |   | 190,815     |  
| | Balance, December 31, 2002                                            | 46,861,364 |  |   | 66,757,818  |  
| | Share purchase options
      exercised (note 6(c))                    | 3,636,600  |  |   | 5,204,175   |  
| | Fair value of stock
      options allocated to shares issued on       |            |  |   |             |  
| | exercise                                                              |            |  |   | 430,000     |  
| | Share purchase warrants
      exercised (note 6(d))                   | 6,541,943  |  |   | 9,883,994   |  
| | Private placement,
      January 2003, net of issue costs (note 6(h)) | 5,600,000  |  |   | 9,416,731   |  
| | Shares and warrants
      issued for mineral property, May 2003       |            |  |   |             |  
| | (note 5(b))                                                           | 10,000,000 |  |   | 13,800,000  |  
| | Balance, December 31, 2003                                            | 72,639,907 |  | $ | 105,492,718 |  

|(c) | Share option plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    | The Company has a share option plan approved by
        the shareholders that allows it to grant options, subject to regulatory
        terms and approval, to its employees, officers, directors and consultants
        to acquire up to 9,800,000 common shares, of which 5,681,000 were outstanding
        at December 31, 2003. The exercise price of each option is set by the
        Board of Directors at the time of grant but cannot be less than market
        price, less permissible discounts, on the Toronto Stock Exchange. Options
        have a maximum term of ten years and terminate 30 days following the termination
        of the optionee's employment or term of engagement, except in the case
        of retirement or death. Vesting of options is made at the discretion of
        the Board of Directors at the time the options are granted.

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| | The continuity of share purchase options is as follows:
| | -------------------------------------------------------

| |                            |   |          |  |  |            |   |  | Contractual    | 
| | -------------------------- | - | -------- |  |  | ---------- | - |  | -------------- | 
| |                            |   | Weighted |  |  |            |   |  | weighted       | 
| |                            |   | average  |  |  |            |   |  | average        | 
| |                            |   | exercise |  |  | Number of  |   |  | remaining life | 
| |                            |   | price    |  |  | options    |   |  | (years)        | 
| | Balance, December 31, 2000 | $ | 1.16     |  |  | 1,993,100  |   |  | 0.29           | 
| | Granted                    |   | 0.65     |  |  | 2,720,000  |   |  |                | 
| | Expired or cancelled       |   | 1.15     |  |  | (2,001,200 | ) |  |                | 
| | Balance, December 31, 2001 |   | 0.95     |  |  | 2,711,900  |   |  | 3.74           | 
| | Granted*                   |   | 1.44     |  |  | 4,174,800  |   |  | 2.68           | 
| | Exercised                  |   | 0.87     |  |  | (179,900   | ) |  |                | 
| | Expired or cancelled       |   | 1.68     |  |  | (56,700    | ) |  |                | 
| | Balance, December 31, 2002 |   | 1.24     |  |  | 6,650,100  |   |  | 2.38           | 
| | Granted                    |   | 1.83     |  |  | 2,667,500  |   |  | 1.60           | 
| | Exercised                  |   | 1.43     |  |  | (3,636,600 | ) |  |                | 
| | Balance, December 31, 2003 | $ | 1.39     |  |  | 5,681,000  |   |  | 2.20           | 

| | * 725,500 of non-employee share options
        granted on May 24, 2002, and exercisable at $1.70 per share, were repriced
        to $1.17 per share on December 11, 2002, with no change to the expiry
        date. | 
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 

| | As at December 31, 2003, 5,197,250 of the options outstanding
      had vested with optionees.                                                                                                                                                                                                                                                                                                                                                                        
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | The exercise prices of all share purchase
        options granted during each year were equal to the market price at the
        grant date. Using an option pricing model with the assumptions noted below,
        the estimated fair value of all options granted during 2003, and the estimated
        fair value of options granted to non-employees during 2002, which have
        been reflected in the consolidated statements of operations, is as follows:

| |                                                   |   | Year ended December 31 | 
| | ------------------------------------------------- | - | ---------------------- | 
| |                                                   |   | 2003                   | 
| | Exploration                                       |   |                        | 
| | Engineering                                       | $ | 135,770                | 
| | Environmental, socioeconomic and land             |   | 116,913                | 
| | Geological                                        |   | 533,550                | 
| |                                                   |   | 786,233                | 
| | Operations and administration                     |   | 1,345,506              | 
| | Total compensation cost recognized in operations, |   |                        | 
| | credited to
      contributed surplus             | $ | 2,131,739              | 

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| | The weighted-average assumptions
        used to estimate the fair value of options granted during the period were:
| | -------------------------------------------------------------------------------------------------------------------

|                        |  | 2003      |  | 2002    | 
|----------------------- |  | --------- |  | ------- | 
|Risk free interest rate |  | 3%        |  | 3%      | 
|Expected life           |  | 2.2 years |  | 2 years | 
|Expected volatility     |  | 85%       |  | 50%     | 
|Expected dividends      |  | nil       |  | nil     | 

| | Summary of the options outstanding at December
      31, 2003 is as follows:
| | ----------------------------------------------------------------------------

| |                                 |   | Exercise |  | Number of | 
| | ------------------------------- | - | -------- |  | --------- | 
| | Expiry date                     |   | price    |  | options   | 
| | December 20, 2004               | $ | 1.17     |  | 128,000   | 
| | January 31, 2005                |   | 1.80     |  | 275,000   | 
| | May 8, 2005                     |   | 1.36     |  | 6,500     | 
| | July 29, 2005                   |   | 1.32     |  | 364,500   | 
| | July 29, 2005                   |   | 1.50     |  | 875,000   | 
| | July 29, 2005                   |   | 1.70     |  | 30,000    | 
| | September 8, 2005               |   | 1.97     |  | 100,000   | 
| | November 30, 2005               |   | 2.50     |  | 655,000   | 
| | November 30, 2005               |   | 2.50     |  | 50,000    | 
| | November 30, 2005               |   | 2.69     |  | 95,000    | 
| | January 10, 2006                |   | 0.96     |  | 2,030,000 | 
| | December 20, 2007               |   | 1.17     |  | 1,072,000 | 
| | Average option price and totals | $ | 1.39     |  | 5,681,000 | 
| | Number
      exercisable        |   |          |  | 5,197,250 | 

| | Subsequent to December 31, 2003, 493,200 options
      were exercised for proceeds of $608,680.
| | -----------------------------------------------------------------------------------------------

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|(d) | Share purchase warrants                      
|--- | ---------------------------------------------
|    |                                              
|    | The continuity of share purchase warrants is:



| | Financial statement |            |   |            |   |          |   |           |     |            |     |            |   |            |  
| | ------------------- | ---------- | - | ---------- | - | -------- | - | --------- | --- | ---------- | --- | ---------- | - | ---------- | -
| | note reference      | 6(e)       |   | 6(f)       |   | 6(g)     |   | 5(a)      |     | 6(h)       |     | 5(b)       |   |            |  
| | Expiry date         | March 15,  |   | June 3,    |   | Dec. 27, |   | August 2, |     | Jan. 30,   |     | April 30,  |   |            |  
| |                     | 2002       |   | 2003       |   | 2003     |   | 2004      |     | 2004       |     | 2004       |   |            |  
| | Exercise price      | $1.00      |   | $1.65      |   | $1.85    |   | $1.55     |     | $1.80      |     | US $0.75   |   | TOTAL      |  
| | Balance             |            |   |            |   |          |   |           |     |            |     |            |   |            |  
| | Dec. 31, 2001       |            |   |            |   |          |   |           |     |            |     |            |   |            |  
| | and
      2000      | 2,500,000  |   |           |   |         |   |          |     |           |     |           |   | 2,500,000  |  
| | Issued              |           |   | 5,616,612  |   | 125,715  |   | 1,000,000 |     |           |     |           |   | 6,742,327  |  
| | Exercised           | (2,007,000 | ) |           |   |         |   |          |     |           |     |           |   | (2,007,000 | )
| | Expired             | ( 493,000  | ) |           |   |         |   |          |     |           |     |           |   | (493,000   | )
| | Balance             |            |   |            |   |          |   |           |     |            |     |            |   |            |  
| | Dec. 31, 2002       |           |   | 5,616,612  |   | 125,715  |   | 1,000,000 |     |           |     |           |   | 6,742,327  |  
| | Issued              |           |   |           |   |         |   |          |     | 3,304,000  |     | 5,000,000  |   | 8,304,000  |  
| | Exercised           |           |   |           |   | (125,715 | ) |          |     | (1,416,228 | )   | (5,000,000 | ) | (6,541,943 | )
| | Expired             |           |   | (5,616,612 | ) |         |   |          |     |           |     |           |   | (5,616,612 | )
| | Balance             |            |   |            |   |          |   |           |     |            |     |            |   |            |  
| | Dec.
      31, 2003 |           |   |           |   |         |   | 1,000,000 | (1) | 1,887,772  | (2) |           |   | 2,887,772  |  

|(1) | Subsequent to December 31, 2003, 250,000 of these warrants
      were exercised.  
|--- | ----------------------------------------------------------------------------------
|    |                                                                                   
|(2) | Subsequent to December 31, 2003, 1,887,772 of these warrants
      were exercised.

|(e) | Special warrant private placement, August 2000                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    | On August 9, 2000, the Company entered into a financing
        agreement with Loewen Ondaatje McCutcheon Limited ("LOM") to raise up
        to $10 million by way of a private placement of special warrants. The
        placement consisted of 5,000,000 special warrants at $2.00 per special
        warrant. Each special warrant was exchanged upon prospectus clearance,
        which occurred on December 19, 2000, for one unit consisting of one common
        share and one half of a common share purchase warrant for no further consideration.
        One full warrant was exercisable at $2.50 into a common share for one
        year (see below). LOM received a fee of $600,000 and a compensation option
        to purchase 500,000 units at $2.00 per unit for a twelve month period
        from closing.                                                                                     
|   
|    | On February 23, 2001, the Company amended the terms
        of the 2,500,000 outstanding share purchase warrants, 500,000 agent's
        share purchase options and 250,000 agent's share purchase warrants. The
        exercise price of the options and warrants was reduced to $1.00 from $2.50,
        but was subject to an accelerated expiry of 30 days if the Company's shares
        traded for ten consecutive days at a price of at least $1.20 per share.
        The term of the options and warrants was extended for one year until August
        16, 2002. At February 14, 2002, the accelerated expiry condition was met
        and the warrants and options were set to expire on March 15, 2002. By
        March 15, 2002, the agent's options and warrants and 2,007,000 of the
        share purchase warrants had been exercised. The remaining 493,000 warrants
        expired unexercised.

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|(f) | Private placement financing, May 2002                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    | On May 23, 2002, the Company entered into a financing
        agreement with LOM to raise up to $7.8 million by way of a private placement.
        The placement, which closed on June 3, 2002, consisted of 5,207,233 units
        at a price of $1.50 per unit. 409,379 units of Great Basin were issued
        as a commission pursuant to this private placement, for a total issuance
        of 5,616,612 units. Each unit was comprised of one common share and a
        share purchase warrant exercisable to purchase an additional share at
        $1.65 until June 3, 2003. If the Company's shares had a closing price
        of at least $2.50 per share on The Toronto Stock Exchange over any 10
        consecutive trading day period, the warrants were subject to a 45 day
        accelerated expiry. During 2003, the 5,616,612 warrants expired unexercised
        .
|   
|(g) | Private placement financing, August 2002                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   
|    | On August 27, 2002, the Company completed a private
        placement financing of 125,715 units at a price of $1.65 per unit. Each
        unit was comprised of one common share and a common share purchase warrant
        exercisable at $1.85 until December 27, 2003. The warrants were subject
        to an accelerated expiry of 45 days if the Company's shares trade on The
        Toronto Stock Exchange at or above $2.78 for ten consecutive trading days.                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|(h) | Private placement financing, January 2003                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   
|    | On January 30, 2003, the Company completed a private
        placement financing of 5,600,000 units at a price of $1.80 per unit. Each
        unit was comprised of one common share and one half of a common share
        purchase warrant. Each common share purchase warrant is exercisable into
        one common share at $1.80 per common share until January 30, 2004. In
        connection with the private placement, the Company granted to the agents
        an option to purchase 336,000 units at $1.80 per unit until January 30,
        2004. Each unit was comprised of one common share and one half of a common
        share purchase warrant. Each whole common share purchase warrant was exercisable
        into one common share at $1.80 per common share until January 30, 2004.
        Subsequent to December 31, 2003, all of these warrants were exercised.  

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|(i) | Contributed surplus
|--- | -------------------

| | Contributed surplus, December 31, 2001 and 2000                        | $ |          |  
| | ---------------------------------------------------------------------- | - | --------- | -
| | Changes during 2002:                                                   |   |           |  
| | Non-cash stock-based
      compensation to non-employees (note 6(c))   |   | 374,627   |  
| | Great Basin Warrants
      issued pursuant to Hecla Earn-in Agreement, |   |           |  
| | August 2002 (note 5(a))                                                |   | 295,000   |  
| | Balance, December 31, 2002                                             |   | 669,627   |  
| | Changes during 2003:                                                   |   |           |  
| | Non-cash stock-based
      compensation (note 6(c))                    |   | 2,131,739 |  
| | Fair value of stock options allocated to shares issued on exercise     |   | (430,000  | )
| | Balance, December 31, 2003                                             | $ | 2,371,366 |  

|7. | Related party balances and transactions
|-- | ---------------------------------------

| | Related party balances          |   | December 31 |   |   | December 31 |  
| | ------------------------------- | - | ----------- | - | - | ----------- | -
| |                                 |   | 2003        |   |   | 2002        |  
| | Hunter Dickinson Inc. (a)       | $ | (456,369    | ) | $ | 694,846     |  
| | Hunter Dickinson Group Inc. (a) |   | (4,879      | ) |   | (43,153     | )

| | Reimbursement for third
      party expenses and |   |                         |  |   |         |  |   |         | 
| | ------------------------------------------------ | - | ----------------------- |  | - | ------- |  | - | ------- | 
| | services rendered                                |   | Year ended December 31, | 
| |                                                  |   | 2003                    |  |   | 2002    |  |   | 2001    | 
| | Hunter Dickinson Inc. (a)                        | $ | 1,411,849               |  | $ | 463,382 |  | $ | 991,301 | 
| | Hunter Dickinson
      Group Inc. (a)            |   | 22,320                  |  |   | 17,735  |  |   |        | 

|   | (a)                                                                                                                                                                                                                                     | Hunter Dickinson Inc. and Hunter Dickinson Group
        Inc. are private companies with certain common directors that provide
        technical, geological, corporate development, administrative and management
        services to, and incur third party costs on behalf of, the Company on
        a full cost recovery basis.                                 
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | (b)                                                                                                                                                                                                                                     | Related party balances receivable (payable), which
        are non-interest bearing and are due on demand, are included in prepaid
        expenses on the consolidated balance sheets. Prepaid balances arise from
        advances by the Company for normal course in-progress and near-term planned
        exploration and other work on the mineral properties.
|  
|8. | Income taxes                                                                                                                                                                                                                           
|  
|   | Substantially all of the difference between
        the actual income tax expense (recovery) of $nil and the expected income
        tax recovery based on statutory tax rates relates to the benefit of losses
        not recognized.

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| | As at December 31, 2003 the tax effect
        of the significant components within the Company's future tax asset (liability)
        were as follows:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------

| |                                         |   | December 31 |  
| | --------------------------------------- | - | ----------- | -
| |                                         |   | 2003        |  
| | Future income tax assets                |   |             |  
| | Mineral properties                      | $ | 6,686,000   |  
| | Loss carry forwards                     |   | 8,437,000   |  
| | Other
      tax pools                   |   | 88,000      |  
| | Subtotal                                |   | 15,211,000  |  
| | Valuation
      allowance               |   | (13,870,000 | )
| | Net future income tax
      asset       |   | 1,341,000   |  
| | Future income tax liability             |   |             |  
| | Mineral
      properties                |   | (1,341,000  | )
| | Net future income tax asset (liability) | $ |            |  

| | At December 31, 2003, the
        Company has available losses for income tax purposes in Canada totaling
        approximately $6.9 million (2002 - $7.7 million), expiring at various
        times from 2004 to 2010. The Company also has capital losses available
        of $nil (2002 - $1.0 million), which, when available, can be used to offset
        future capital gains. The Company also has available resource tax pools
        in Canada of approximately $7.4 million (2002 - $7.4 million), which may
        be carried forward and utilized to reduce future taxes related to resource
        income. Included in the $7.4 million (2002 - $7.4 million) of resource
        tax pools is $2.9 million (2002 - $2 million) which is successored, and
        consequently can only be utilized from taxable income from specific mineral
        properties.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | At December 31, 2003, the
        Company also has net operating loss carry forwards for United States income
        tax purposes of approximately US$13.6 million (2002 - US$14.6 million)
        which, if not utilized to reduce United States taxable income in future
        periods, expires through the year 2022. These available tax losses may
        only be applied to offset future taxable income from the Company's current
        United States subsidiaries. In addition, the Company has available resource
        tax pools in the United States of approximately US$3.6 million (2002 -
        US$3.9 million).                                                                                                                                                                                                                                           

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

|9. | Segment disclosure                                                                                                                                                                            
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | The Company considers itself to operate in a single
        reportable operating segment, the exploration and development of mineral
        properties. Geographic information is as follows:

| |                                                   |   | December 31, |  |   | December 31, | 
| | ------------------------------------------------- | - | ------------ |  | - | ------------ | 
| | Assets                                            |   | 2003         |  |   | 2002         | 
| | Canada                                            |   |              |  |   |              | 
| | Assets excluding mineral property
      interests | $ | 21,211,606   |  | $ | 15,327,770   | 
| | Mineral property interests                        |   | 2            |  |   | 1,933,002    | 
| | United States                                     |   |              |  |   |              | 
| | Assets excluding mineral property
      interests |   | 88,313       |  |   | 7,500        | 
| | Mineral property interests                        |   | 3,945,348    |  |   | 3,945,348    | 
| | Republic of South Africa                          |   |              |  |   |              | 
| | Assets excluding mineral property
      interests |   | 833,200      |  |   | 18,125       | 
| | Mineral
      property interests                  |   | 26,722,743   |  |   | 1            | 
| | Total assets                                      | $ | 52,801,212   |  | $ | 21,231,746   | 

|10. | Differences between Canadian and United States
      generally accepted accounting principles These financial
        statements have been prepared in accordance with Canadian generally accepted
        accounting principles (“Canadian GAAP”). A description of
        United States generally accepted accounting principles (“US GAAP”)
        and rules prescribed by the United States Securities and Exchange Commission
        (“SEC”) that result in material measurement differences from
        Canadian GAAP follows:
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| |     | prospectively adopted the fair value method of accounting
        for stock-based compensation, a treatment consistent with the accounting
        treatment used for Canadian GAAP.
      For all periods presented, under US GAAP, stock options
        granted to non-employees for services rendered to the Company are required
        to be accounted for based on the fair value of the services provided or
        the consideration issued. The compensation cost is to be measured based
        on the fair value of stock options granted, with the compensation cost
        being charged to operations. The stock-based compensation expense in respect
        of non-employee share options, based upon the fair value of the options
        using an option pricing model, which was required to be charged to operations
        under US GAAP, and not under Canadian GAAP, for the year ended December
        31, 2001 was $230,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (b) | US GAAP requires investments in available-for-sale
        securities to be recorded at fair value in accordance with SFAS 115, “Accounting
        for Certain Investments in Debt and Equity Securities”. Unrealized
        gains and losses are recorded as other comprehensive income (see below)
        which is a separate component of shareholders’ equity, except for
        declines in fair value that are determined to be other than temporary.
        These declines in value are charged to the statement of operations, which
        is similar to Canadian GAAP.
      US GAAP requires the Company to present comprehensive
        income (loss) in accordance with SFAS 130, “Reporting Comprehensive
        Income”, which establishes standards for reporting and display
        of comprehensive income (loss), its components and accumulated balances.
        Comprehensive income (loss) comprises net income (loss) and all changes
        to shareholders’ equity except those resulting from investments
        by owners and distributions to owners.
      Under US GAAP, the Hecla Warrants would be considered
        derivative financial instruments and would be accounted for under SFAS
        133, "Accounting for Derivative Instruments and Hedging Activities”,
        until they are exercised. Once exercised, the shares of Hecla Mining Company
        received would be considered an available-for-sale security and would
        be accounted for under SFAS 115. SFAS 133 requires that all derivative
        financial instruments be recognized in the financial statements and measured
        at fair value. Changes in the fair value of a derivative financial instrument
        are charged to operations if the instrument does not qualify as a hedge,
        or to operations or other comprehensive income, a separate component of
        shareholders' equity, if it does qualify as a hedge.
      Canadian GAAP does not require the presentation of comprehensive
        income (loss).
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | (c) | In August 2001, the FASB issued Statement of Financial
        Accounting Standards No. 144, “Accounting for the Impairment or
        Disposal of Long-Lived Assets” (“SFAS 144”). SFAS 144
        addresses financial accounting and reporting for the impairment or disposal
        of long-lived assets. This statement requires that long-lived assets be
        reviewed for impairment whenever events or changes in circumstances indicate
        that the carrying amount of an asset may not be recoverable. Recoverability
        of assets to be held and used is measured by a comparison of the carrying
        amount of an asset to future net cash flows                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| |                                                                                                                                                                                                                                                     | expected to be generated by the asset. If the carrying
        amount of an asset exceeds its estimated future cash flows, an impairment
        charge is recognized in the amount by which the carrying amount of the
        asset exceeds the fair value of the asset. SFAS 144 also broadens the
        definition of discontinued operations to include all distinguishable components
        of an entity that will be eliminated from ongoing operations. The Company
        adopted SFAS 144 on January 1, 2003, on a prospective basis, and there
        are no material differences between the treatment under Canadian and US
        GAAP.                                                                                                                                                                                                                                                                                                                                                                                                               
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (d)                                                                                                                                                                                                                                                 | In June 2001, the Financial Accounting Standards
        Board issued Statement No. 143 (“FAS 143”) “Accounting
        for Asset Retirement Obligations”, which addresses financial accounting
        and reporting for obligations associated with the retirement of tangible
        long-lived assets and the associated asset retirement costs. The standard
        applies to legal obligations associated with the retirement of long-lived
        assets that result from the acquisition, construction, development and
        (or) normal use of the asset.
      For the year ended December 31, 2003, the Company has
        adopted FAS 143 and determined there is no material difference between
        Canadian GAAP and US GAAP as the Company’s Ivanhoe property’s
        reclamation obligation is similar to amounts accrued under Canadian GAAP.
        In addition, the Burnstone Gold property and Casino property have indeterminable
        asset retirement obligations due to the exploration stage of such mineral
        properties.
| |                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (e)                                                                                                                                                                                                                                                 | Canadian GAAP allows the presentation of subtotals
        for "expenses" and "other items" in the consolidated
        statement of operations. No such subtotals would be presented under US
        GAAP.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (f)                                                                                                                                                                                                                                                 | Pursuant to US GAAP, the Company would be considered
        a development stage company as the Company is devoting efforts to establishing
        a commercially viable mineral property. However, the identification of
        the Company as such for accounting purposes does not impact the measurement
        principles applied in these consolidated financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Summary of effect of differences in Canadian
        and US GAAP
      The effect of the above differences between Canadian
        GAAP and US GAAP on the balance sheet and statement of operations and
        deficit is summarized as follows:

| | Share
      capital and contributed surplus                     |   | 2003        |  |   | 2002       | 
| | --------------------------------------------------------------- | - | ----------- |  | - | ---------- | 
| | Share capital and contributed surplus under
      Canadian GAAP | $ | 107,864,084 |  | $ | 67,427,445 | 
| | Stock-based
      compensation                                  |   | 2,658,000   |  |   | 2,658,000  | 
| | Share
      capital and contributed surplus under US GAAP       | $ | 110,522,084 |  | $ | 70,085,445 | 

---

|GREAT BASIN GOLD LTD. 
      Notes to Consolidated Financial Statements 
      Years ended December 31, 2003, 2002 and 2001 
      (Expressed in Canadian Dollars)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                  

| | Deficit                                               |   | 2003       |   |   | 2002       |  
| | ----------------------------------------------------- | - | ---------- | - | - | ---------- | -
| | Deficit under Canadian GAAP                           | $ | 55,881,048 |   | $ | 48,384,541 |  
| | Stock-based compensation                              |   | 2,658,000  |   |   | 2,658,000  |  
| | Mark-to-market adjustment, Hecla Warrants (note 5(a)) |   | (727,000   | ) |   | (727,000   | )
| | Reduction of gain on sale of investments due to       |   |            |   |   |            |  
| | prior year mark-to-market adjustment                  |   | 727,000    |   |   |           |  
| | Deficit
      under US GAAP                           | $ | 58,539,048 |   | $ | 50,315,541 |  
| |                                                       |   |            |   |   |            |  
| | Total assets                                          |   | 2003       |   |   | 2002       |  
| | Total assets under Canadian GAAP                      | $ | 52,801,212 |   | $ | 21,231,746 |  
| | Mark-to-market
      adjustment, Hecla Warrants       |   |           |   |   | 727,000    |  
| | Total assets
      under US GAAP                      | $ | 52,801,212 |   | $ | 21,958,746 |  

| | Loss for
      the year                               |   | 2003      |   |   | 2002      |   |   | 2001      | 
| | ----------------------------------------------------- | - | --------- | - | - | --------- | - | - | --------- | 
| | Loss for the year under Canadian GAAP                 | $ | 7,496,507 |   | $ | 5,519,089 |   | $ | 9,064,905 | 
| | Stock-based compensation                              |   |          |   |   |          |   |   | 860,000   | 
| | Mark-to-market adjustment,                            |   |           |   |   |           |   |   |           | 
| | Hecla Warrants (note 5(a))                            |   |          |   |   | (727,000  | ) |   |          | 
| | Reduction of gain on sale of investments due
      to |   |           |   |   |           |   |   |           | 
| | prior
      year mark-to-market adjustment            |   | 727,000   |   |   |          |   |   |          | 
| | Loss for the year under US GAAP                       |   | 8,223,507 |   |   | 4,792,089 |   |   | 9,924,905 | 
| | Other comprehensive income:                           |   |           |   |   |           |   |   |           | 
| | Mark-to-market adjustment on warrants                 |   |          |   |   | 727,000   |   |   |          | 
| | Realization of prior years mark-to-market            |   |           |   |   |           |   |   |           | 
| | adjustment                                            |   | (727,000  | ) |   |          |   |   |          | 
| | Comprehensive
      loss                              | $ | 7,496,507 |   | $ | 5,519,089 |   | $ | 9,924,905 | 
| |                                                       |   |           |   |   |           |   |   |           | 
| | Loss per
      share under US GAAP                    | $ | 0.14      |   | $ | 0.13      |   | $ | 0.26      | 

---