UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   FORM 10-QSB

              [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                  FOR THE QUARTERLY PERIOD ENDED APRIL 30, 2005

             [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                   EXCHANGE ACT FOR THE TRANSITION PERIOD FROM
                       _______________ to _______________

                         Commission File Number 0-20722

                                  NEWGOLD, INC.
        (Exact name of small business issuer as specified in its charter)



            DELAWARE                                  16-1400479
--------------------------------------- ----------------------------------------
(State of other jurisdiction of             (I.R.S. Employer Identification
incorporation or organization)                          Number)



     400 Capitol Mall, Suite 900
        Sacramento, California                          95814
--------------------------------------- ----------------------------------------
(Address of Principal Executive Offices)               Zip Code


               Issuer's telephone number:            (916) 449-3913


Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the Securities  Exchange Act of 1934 during the preceding
12 months (or for such shorter  period that the issuer was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days:
                         YES   X                        NO

Common stock, $0.001 par value,  50,777,841 issued and outstanding as of June 1,
2005.

Transitional Small Business Disclosure Format:                Yes ____ No __X___
<PAGE>

                                      INDEX

                                                                            Page

PART I - FINANCIAL INFORMATION................................................3

        ITEM 1.   FINANCIAL STATEMENTS........................................3

        ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
                  OPERATIONS.................................................16

        ITEM 3.  CONTROLS AND PROCEDURES.....................................23

PART II - OTHER INFORMATION..................................................24

        ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES.....................24

        ITEM 5.  OTHER INFORMATION...........................................25

        ITEM 6.  EXHIBITS ...................................................25






































                                       2
<PAGE>

                         PART I - FINANCIAL INFORMATION


ITEM 1.   FINANCIAL STATEMENTS


                                  NEWGOLD, INC.
                     INDEX TO UNAUDITED FINANCIAL STATEMENTS



                                                                          Page
                                                                          ----

       Condensed Balance Sheet as of April 30, 2005 (Unaudited)            4

       Condensed Statements of Operations for the three months
       ended April 30, 2005 and 2004 (Unaudited)                           5

       Condensed Statements of Comprehensive Loss for the three months
       ended April 30, 2005 and 2004 (Unaudited)                           6

       Condensed Statements of Cash Flows for the three months
       ended April 30, 2005 and 2004 (Unaudited)                           7

       Notes to Unaudited Financial Statements                           8-15































                                       3
<PAGE>
                                                                   NEWGOLD, INC.
                                                         CONDENSED BALANCE SHEET
                                                                  April 30, 2005
                                                                     (Unaudited)
--------------------------------------------------------------------------------

                                     ASSETS

Current assets
     Cash                                                        $     243,192
     Travel advance                                                      2,657
                                                                 --------------

              Total current assets                                     245,849

Other Assets
     Deferred reclamation costs                                        513,946
                                                                 --------------

              Total other assets                                       513,946
                                                                 --------------

                  Total assets                                   $     759,795
                                                                 ==============

                      LIABILITIES AND SHAREHOLDERS' DEFICIT

Current liabilities
     Accounts payable                                            $     538,276
     Accrued expenses                                                1,708,409
     Accrued reclamation costs                                         513,946
     Notes payable due to individuals and officers                   1,327,147
                                                                 --------------

         Total current liabilities                                   4,087,778

Deferred revenue                                                       800,000
                                                                 --------------

         Total liabilities                                           4,887,778

Commitments and contingencies

Shareholders' deficit
     Common stock, $0.001 par value
         250,000,000 shares authorized
         50,777,841 shares issued and outstanding                       50,778
     Additional paid in capital                                     12,795,245
     Accumulated deficit                                           (16,974,006)

              Total shareholders' deficit                           (4,127,983)
                                                                 --------------

                  Total liabilities and shareholders' deficit    $     759,795
                                                                 ==============

                                       4

    The accompanying notes are an integral part of these financial statements
<PAGE>


                                                                   NEWGOLD, INC.
                                              CONDENSED STATEMENTS OF OPERATIONS
                                            For the Three Months Ended April 30,
                                                                     (Unaudited)

--------------------------------------------------------------------------------

                                                        2005            2004
                                                    -----------     -----------


Net sales                                           $        -      $        -

Cost of goods sold                                      29,000           5,000
                                                    -----------     -----------

Gross loss                                             (29,000)         (5,000)

Operating expenses                                    (202,880)        (75,375)
                                                    -----------     -----------

Loss from operations                                  (231,880)        (80,375)
                                                    -----------     -----------

Other income (expense)
         Interest expense                             (356,824)        (47,565)
                                                    -----------     -----------

         Total other income (expense)                 (356,824)        (47,565)
                                                    -----------     -----------

Net loss                                            $ (588,704)     $ (127,940)
                                                    ===========     ===========

Basic and diluted loss per share                    $    (0.01)     $    (0.01)
                                                    ===========     ===========

Basic and diluted weighted-average
         shares outstanding                         49,446,380      47,606,174
                                                    ===========     ===========















                                       5

    The accompanying notes are an integral part of these financial statements
<PAGE>

                                                                   NEWGOLD, INC.
                                      CONDENSED STATEMENTS OF COMPREHENSIVE LOSS
                                            For the Three Months Ended April 30,
                                                                     (Unaudited)

--------------------------------------------------------------------------------

                                                     2005               2004
                                                 ------------     ------------
Net loss                                         $  (588,704)     $   (127,940)

Other comprehensive loss
     Unrealized loss from
         marketable securities                             -           (30,618)
                                                 ------------     ------------

Comprehensive loss                               $  (588,704)     $   (158,558)
                                                 ============     ============





































                                       6

    The accompanying notes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>

                                                                                     NEWGOLD, INC.
                                                                CONDENSED STATEMENTS OF CASH FLOWS
                                                              For the Three Months Ended April 30,
                                                                                       (Unaudited)

--------------------------------------------------------------------------------------------------

                                                                          2005            2004
                                                                     ------------     ------------
<S>                                                                  <C>              <C>
Cash flows from operating activities
     Net loss                                                        $  (588,704)     $  (127,940)
     Adjustments to reconcile net loss to net cash
         used in operating activities
              Accretion of warrants issued as a debt discount            294,192           15,980
              Accretion of beneficial conversion of warrants              26,868                -
              (Increase) Decrease in
                  Deposits                                                     -           11,000
                  Travel advance                                            (657)               -
              Increase (Decrease) in
                  Accounts payable                                       (30,000)               -
                  Accrued salaries and benefits                          (50,237)          40,000
                  Accrued expenses                                             -           51,275
                                                                     ------------     ------------
                      Net cash (used) provided by
                           operating activities                         (348,538)          (9,685)
                                                                     ------------     ------------
Cash flows from investing activities                                           -                -

Cash flows from financing activities
     Proceeds from the issuance of common stock                          575,000                -
     Proceeds from note payable                                                -           10,000
     Repayments of note payable                                                -             (350)
                                                                     ------------     ------------

                  Net cash provided (used) by financing activities       575,000            9,650

                      Net increase (decrease) in cash                    226,462              (35)

Cash, beginning of period                                                 16,730            5,967
                                                                     ------------     ------------
Cash, end of period                                                  $   243,192      $     5,932
                                                                     ============     ============

</TABLE>








                                       7

    The accompanying notes are an integral part of these financial statements
<PAGE>

                                                                   NEWGOLD, INC.
                                                   NOTES TO FINANCIAL STATEMENTS
                                       For the Three Months Ended April 30, 2005
                                                                     (Unaudited)

--------------------------------------------------------------------------------

NOTE 1 - ORGANIZATION AND LINE OF BUSINESS

         NEWGOLD,  Inc. (the  "Company")  has been in the business of acquiring,
         exploring,  developing,  and producing gold properties. The Company had
         rights to mine properties in Nevada and Montana.  Its primary focus was
         on the Relief Canyon mine located near Lovelock,  Nevada,  where it has
         performed  development and exploratory  drilling and was in the process
         of obtaining  permits to allow  operation of the Relief Canyon Mine. In
         December  1997,  the Company  placed the Relief Canyon Mine on care and
         maintenance  status.  The Company  also  conducted  exploration  at its
         Washington Gulch Mine property in Montana.

         In  February  2000 the  Company  began to  implement  an  entirely  new
         business  model  of  investing  in  Internet  companies.   Due  to  the
         deterioration  of the  investment  market for these types of  companies
         later in 2000, the Company  abandoned this  investment  strategy.  From
         mid-2001 until the beginning of 2003 Newgold was essentially  inactive,
         only continuing with some of the care and maintenance at Relief Canyon,
         as provided for by a  non-affiliate  company  owned by the Chairman and
         CEO of Newgold.

         The Company has embarked on a business  strategy whereby it will invest
         in and/or  manage gold mining and other mineral  producing  properties.
         Currently,  the Company's  principal  assets  include  various  mineral
         leases  associated  with the Relief Canyon mine located near  Lovelock,
         Nevada along with  various  items of mining  equipment  located at that
         site.  The  Company's  business  will be to  acquire,  explore  and, if
         warranted,  develop various mining  properties  located in the state of
         Nevada.  The Company plans to carryout  comprehensive  exploration  and
         development programs on its properties.  While the Company may fund and
         conduct  these  activities  itself,  the  Company's  current plan is to
         outsource  most of these  activities  through the use of various  joint
         venture,  royalty or partnership  arrangements  pursuant to which other
         companies  would  agree to finance and  carryout  the  exploration  and
         development programs on Newgold's mining properties.  Consequently, the
         Company's  current  plan will not  require  the  hiring of  significant
         amounts  of  mining  employees  but will  require  a  smaller  group of
         employees  to monitor  and/or  supervise  the  mining  and  exploration
         activities of other entities in exchange for royalties or other revenue
         sharing arrangements.


NOTE 2 - GOING CONCERN

         These financial statements have been prepared on a going concern basis.
         However, during the year ended January 31, 2005, the Company incurred a
         net loss of $1,278,140  and had negative cash flows from  operations of
         $353,201.  In addition,  the Company had an  accumulated  shareholders'
         deficit of  $4,114,280 at January 31, 2005.  The  Company's  ability to
         continue as a going  concern is dependent  upon its ability to generate
         profitable  operations  in the future  and/or to obtain  the  necessary
         financing to meet its  obligations  and repay its  liabilities  arising
         from  normal  business  operations  when they come due.  The outcome of
         these  matters  cannot be  predicted  with any  certainty at this time.
         Since inception, the Company has satisfied its capital


                                       8
<PAGE>

         needs by issuing equity securities.

         Management  plans to continue to provide for its capital  needs  during
         the year  ended  January  31,  2006 by  issuing  equity  securities  or
         incurring  additional debt  financing,  with the proceeds to be used to
         re-establish  mining operations at Relief Canyon as well as improve its
         working capital position. These financial statements do not include any
         adjustments to the amounts and classification of assets and liabilities
         that may be  necessary  should the  Company be unable to  continue as a
         going concern.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Cash and Cash Equivalents
         -------------------------
         For the purpose of the statements of cash flows, the Company  considers
         all highly liquid  investments  purchased  with original  maturities of
         three months or less to be cash equivalents.

         Marketable Securities Available for Sale
         ----------------------------------------
         Investments in equity securities are classified as  available-for-sale.
         Securities  classified  as  available  for sale are marked to market at
         each period end.  Changes in value on such securities are recorded as a
         component of Other  comprehensive  income (loss).  If declines in value
         are deemed  other than  temporary,  losses are  reflected in Net income
         (loss).

         Deferred Reclamation Costs
         --------------------------
         In August 2001,  the  Financial  Accounting  Standards  Board  ("FASB")
         issued Statement of Financial  Accounting  Standards  ("SFAS") No. 143,
         "Accounting  for Asset  Retirement  Obligations,"  which  established a
         uniform  methodology  for  accounting  for  estimated  reclamation  and
         abandonment  costs.  The  statement was adopted  February 1, 2003.  The
         reclamation  costs will be  allocated  to expense  over the life of the
         related  assets and will be  adjusted  for changes  resulting  from the
         passage  of time and  revisions  to either  the timing or amount of the
         original present value estimate.

         Prior to adoption of SFAS No. 143,  estimated future  reclamation costs
         were based principally on legal and regulatory requirements. Such costs
         related to active  mines were  accrued  and charged  over the  expected
         operating  lives of the mines using the UOP method  based on proven and
         probable  reserves.  Future  remediation  costs for inactive mines were
         accrued based on  management's  best estimate at the end of each period
         of the undiscounted  costs expected to be incurred at a site. Such cost
         estimates  included,  where applicable,  ongoing care,  maintenance and
         monitoring costs. Changes in estimates at inactive mines were reflected
         in earnings in the period an estimate was revised.

         Risks Associated with Gold Mining
         ---------------------------------
         The  business  of gold  mining is subject  to  certain  types of risks,
         including environmental hazards, industrial accidents, and theft. Prior
         to suspending operations, the Company carried insurance against certain
         property   damage   loss   (including   business    interruption)   and
         comprehensive general liability insurance. While the Company maintained
         insurance  consistent  with  industry  practice,  it is not possible to
         insure  against  all risks  associated  with the  mining  business,  or
         prudent to assume that  insurance  will  continue to be  available at a
         reasonable cost. The Company has not obtained  environmental  liability
         insurance  because such coverage is not  considered by management to be
         cost effective.  The Company  currently  carries no insurance on any of
         its  properties due to the current status of the mine and the Company's
         current financial condition.

                                       9
<PAGE>

         Reclamation Costs
         -----------------
         Reclamation costs and related accrued  liabilities,  which are based on
         the Company's  interpretation  of current  environmental and regulatory
         requirements, are accrued and expensed, upon determination.

         Based  on  current  environmental  regulations  and  known  reclamation
         requirements,  management  has  included  its best  estimates  of these
         obligations  in its  reclamation  accruals.  However,  it is reasonably
         possible that the Company's best estimates of its ultimate  reclamation
         liabilities  could change as a result of changes in regulations or cost
         estimates.

         Comprehensive Income
         --------------------
         The Company utilizes SFAS No. 130,  "Reporting  Comprehensive  Income."
         This statement establishes standards for reporting comprehensive income
         and its components in a financial  statement.  Comprehensive  income as
         defined  includes  all changes in equity (net  assets)  during a period
         from   non-owner   sources.   Examples  of  items  to  be  included  in
         comprehensive  income,  which are  excluded  from net  income,  include
         foreign currency  translation  adjustments,  minimum pension  liability
         adjustments,  and  unrealized  gains and  losses on  available-for-sale
         marketable  securities.   Comprehensive  income  is  presented  in  the
         Company's  financial  statements  since the Company did have unrealized
         gain  (loss)  of  from   changes  in  equity  from   available-for-sale
         marketable securities.

         Stock-Based Compensation
         ------------------------
         SFAS No. 123, "Accounting for Stock-Based  Compensation," as amended by
         SFAS No. 148, "Accounting for Stock-Based Compensation - Transition and
         Disclosure,"  defines  a fair  value  based  method of  accounting  for
         stock-based  compensation.  However,  SFAS No.  123 allows an entity to
         continue  to  measure  compensation  cost  related  to stock  and stock
         options  issued to employees  using the intrinsic  method of accounting
         prescribed  by  Accounting  Principles  Board  ("APB")  Opinion No. 25,
         "Accounting for Stock Issued to Employees." Entities electing to remain
         with  the  accounting  method  of  APB  No.  25  must  make  pro  forma
         disclosures  of net income and  earnings per share as if the fair value
         method of  accounting  defined  in SFAS No. 123 had been  applied.  The
         Company  has  elected to account for its  stock-based  compensation  to
         employees using the intrinsic value method under APB No. 25. There were
         no stock  options  granted or  outstanding  for the three  months ended
         April 30, 2005 and 2004.

         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
         revenue and expenses during the reporting period.  Actual results could
         differ from those estimates.

         Loss Per Share
         --------------
         The Company utilizes SFAS No. 128, "Earnings per Share." Basic loss per
         share is computed by dividing loss available to common  shareholders by
         the weighted-average number of common shares outstanding.  Diluted loss
         per share is computed  similar to basic loss per share  except that the
         denominator  is  increased to include the number of  additional  common
         shares that would have been  outstanding if the potential common shares
         had been issued and if the  additional  common  shares  were  dilutive.
         Common  equivalent  shares are excluded from the  computation  if their
         effect is anti-dilutive.

                                       10
<PAGE>

         The  following   common  stock   equivalents  were  excluded  from  the
         calculation  of diluted  loss per share since their  effect  would have
         been anti-dilutive:

                                                       2005              2004
                                                    ----------        ---------
                      Warrants                      13,324,583        3,782,562

         Recent Accounting Pronouncements
         In March  2005,  the FASB issued  FASB  Interpretation  ("FIN") No. 47,
         "Accounting for Conditional Asset Retirement  Obligations".  FIN No. 47
         clarifies that the term conditional asset retirement obligation as used
         in  FASB   Statement  No.  143,   "Accounting   for  Asset   Retirement
         Obligations,"  refers  to  a  legal  obligation  to  perform  an  asset
         retirement  activity in which the timing and (or) method of  settlement
         are  conditional  on a future  event  that may or may not be within the
         control of the entity.  The obligation to perform the asset  retirement
         activity is  unconditional  even though  uncertainty  exists  about the
         timing  and (or)  method of  settlement.  Uncertainty  about the timing
         and/or  method  of  settlement  of  a  conditional   asset   retirement
         obligation  should be factored  into the  measurement  of the liability
         when sufficient  information exists. This interpretation also clarifies
         when an entity would have sufficient information to reasonably estimate
         the  fair  value  of an  asset  retirement  obligation.  FIN No.  47 is
         effective no later than the end of fiscal  years ending after  December
         15, 2005 (December 31, 2005 for calendar-year companies). Retrospective
         application  of interim  financial  information is permitted but is not
         required.  Management  does not expect adoption of FIN No. 47 to have a
         material impact on the Company's financial statements.


NOTE 4 - MARKETABLE SECURITIES AVAILABLE FOR SALE

         At April 30, 2005 the Company held no marketable  securities  available
         for sale.  At April 30, 2004 the Company held 71,205  common  shares of
         NutraCea  which  was  accounted  for  as an  investment  in  marketable
         securities. During the quarter ended April 30, 2004, unrealized holding
         losses of $30,618 were recorded in Other  comprehensive loss to reflect
         the market  value  decrease  during  the  period.  In October  2004 the
         Company sold all of its investment in marketable securities.

NOTE 5 - PROPERTY AND EQUIPMENT

         The  Company  had  previously  determined  that the  value of its fixed
         assets at the Relief  Canyon Mine were  permanently  impaired and wrote
         off assets with a basis of  $800,000.  If the  Company can  reestablish
         mining  operations  at Relief  Canyon it is possible that some of these
         assets could be utilized in such operations.

         A summary of property and equipment was as follows:
<TABLE>
<CAPTION>
                                        Machinery
                                            &      Development  Capitalized
                             Buildings  Equipment  Costs        Interest     Total

<S>                          <C>        <C>        <C>          <C>          <C>
         Relief Canyon Mine  $215,510   $277,307   $261,742     $45,441      $800,000
</TABLE>

         All office  furniture and equipment  has been fully  depreciated  as of
         April 30, 2005.

                                       11
<PAGE>

NOTE 6 - NOTES PAYABLE TO RELATED PARTIES AND INDIVIDUALS

         Unsecured  notes payable to individuals  and related parties consist of
the following at April 30, 2005:

         Loans from officers:
           Convertible notes payable                          $1,611,993
              The notes bear interest at 8% per year.
              In October 2004, the Company consolidated the amounts owed to the
              Chief Executive Officer and the Chief Financial Officer referred
              to in Note 9 (excluding accrued interest payable) into new
              convertible notes payable due September 30, 2005. The notes and
              any interest accrued on the new notes are convertible into common
              shares of the Company at a conversion price of $0.15 per share. In
              connection with the loans, warrants to purchase 5,798,140 and
              1,395,007 shares of common stock have been issued to the Chief
              Executive Officer and the Chief Financial Officer, respectively.

           Term notes payable                                    $19,844
               The notes bear interest at 8% per year.
               The notes are due January 31, 2006. The Company is not in default
               with  respect  to these  loans.  In  connection  with the  loans,
               warrants to  purchase  141,540  shares of common  stock have been
               issued.  The warrants  have been valued  using the  Black-Scholes
               option  pricing  model (see Note 8). The warrants  were issued at
               $0.15  per  share  and  expire  in five  years  from  the date of
               issuance.

           Loan from individual                                 $176,500
              The note bears interest at 8% per year.
              The note is currently due. The Company is in default with respect
              to this loan.

           Other non-interest bearing advances                    47,038
           Unamortized warrant expense                          (528,228)
              Total notes payable to individuals
                        and related parties                   $1,327,147

         Interest  expense was $356,824 and $47,565 for the quarters ended April
         30, 2005 and 2004, respectively.

NOTE 7 - COMMITMENTS AND CONTINGENCIES

         Except for the  advance  royalty and rent  payments  noted  below,  the
         Company is not  obligated  under any capital  leases or  non-cancelable
         operating  lease with initial or remaining lease terms in excess of one
         year as of April 30, 2005. However, minimum annual royalty payments are
         required to retain the lease rights to the Company's properties.

         Relief Canyon Mine
         ------------------
         The Company purchased the Relief Canyon Mine from J.D. Welsh Associates
         ("Welsh") in January 1995.  The mine consisted of 39 claims and a lease
         for access to an additional 800 acres contiguous to the claims.  During
         1997,  the  Company  staked an  additional  402 claims.  Subsequent  to
         January  31,  1998,  the  Company   reduced  the  total  claims  to  50
         (approximately  1,000  acres).  The annual  payment to  maintain  these
         claims is $5,000.  As part of the  original  purchase of Relief  Canyon
         Mine,  Welsh assigned the lease from Santa Fe Gold  Corporation  (Santa
         Fe) to the  Company.  The  lease  granted  Santa Fe the  sole  right of
         approval of transfer to any subsequent owner of the Relief Canyon Mine.
         Santa Fe had  accepted  lease and  minimum  royalty  payments  from the
         Company,  but has  declined  to approve  the  transfer.  Due to Welsh's
         inability to transfer the Santa Fe lease,  the original  purchase price
         of  $500,000  for Relief  Canyon Mine was reduced


                                       12
<PAGE>

         by $50,000 in 1996 to $450,000.

         Subsequent to January 31, 1998,  the lease was  terminated by Santa Fe.
         Management  believes  loss of the Santa Fe lease will have no  material
         adverse affect on the remaining operations of the mine operation or the
         financial position of the Company.

         During 1996,  Repadre  Capital  Corporation  ("Repadre")  purchased for
         $500,000 a net smelter return royalty (Repadre Royalty). Repadre was to
         receive a 1.5% royalty  from  production  at each of the Relief  Canyon
         Mine and Mission Mines.  In July 1997, an additional  $300,000 was paid
         by Repadre for an additional 1% royalty from the Relief Canyon Mine. In
         October,  1997,  when the Mission  Mine lease was  terminated,  Repadre
         exercised  its option to  transfer  the Repadre  Royalty  solely to the
         Relief  Canyon Mine  resulting in a total 4% royalty.  The total amount
         received of  $800,000  has been  recorded  as  deferred  revenue in the
         accompanying financial statements.

         Litigation
         ----------
         On February 4, 2000, a complaint  was filed  against the Company by Sun
         G. Wong in the Superior Court of Sacramento  County,  California  (Case
         No.  00AS00690).  In the  complaint,  Mr.  Wong claims that he was held
         liable as a guarantor of Newgold in a claim brought by Don Christianson
         in a breach of contract action against  Newgold.  Despite the fact that
         Newgold settled the action with Mr.  Christianson  through the issuance
         of 350,000 shares of Newgold common stock, Mr. Wong, nevertheless, paid
         $60,000 to a third party claiming to hold Mr.  Christianson's  judgment
         pursuant to Mr. Wong's guaranty agreement.  Similarly, Mr. Wong alleges
         that he was held liable as a guarantor  for a debt of $200,000  owed by
         Newgold to Roger  Primm with regard to money  borrowed by Newgold.  Mr.
         Primm  filed suit  against the  Company  which was settled  through the
         issuance of 300,000 shares of Newgold common stock.  Nevertheless,  Mr.
         Wong alleges that he remains  liable to a third party  claiming to hold
         Mr.  Primm's  judgment  for up to $200,000  pursuant to his guaranty of
         such debt of Mr. Primm.

         On December 29, 2000,  the superior  court  entered a default  judgment
         against   Newgold  in  the  amount  of  $400,553  with  regard  to  the
         Christianson judgment and an additional $212,500 in regard to the Primm
         judgment  against Mr. Wong. The Company  believes that Mr. Wong was not
         obligated to pay any sums pursuant to his guarantees with regard to the
         Christianson and Primm judgments against Newgold and, as a result,  Mr.
         Wong   should  not  have  any   recourse   against   the   Company  for
         reimbursement.  Should Mr. Wong seek to assert these judgments  against
         the Company,  the Company cannot predict the outcome of any such action
         or the  amount  of  expenses  that  would  be  ultimately  incurred  in
         defending  any such  claims.  The Company is  currently  negotiating  a
         settlement  with  Mr.  Wong,  however  there  is no  assurance  that an
         acceptable settlement will be consummated.

         The  Company is  involved  in various  other  claims and legal  actions
         arising  in  the  ordinary  course  of  business.  In  the  opinion  of
         management,  the ultimate dispositions of these matters will not have a
         material adverse effect on the Company's financial position, results or
         operations or liquidity.




                                       13
<PAGE>

NOTE 8 - SHAREHOLDERS' DEFICIT

         Common Stock
         ------------
         In March 2005 a Special Meeting of Shareholders of the Company was held
         for the purpose of amending the Articles of  Incorporation to affect an
         increase  in  the  authorized   shares  of  common  stock  issuable  to
         250,000,000  shares.  At the meeting the  proposal  was approved by the
         shareholders,  with a total of 31,392,611 shares voting in favor of the
         amendment,  411,711  voting  against the  amendment  and 10,207  shares
         abstained from voting.

         In February 2005 the Company issued 500,000 shares of common stock at a
         price of $0.15 per share to an investor for total  proceeds of $75,000.
         Additionally,  500,000  warrants to purchase common stock at a price of
         $0.30 per share were issued to the investor.  The warrants expire three
         years from the date of issuance.

         In April 2005 the Company issued  2,000,000 shares of common stock at a
         price of $0.25 per share to investors  for total  proceeds of $500,000.
         Additionally, 1,000,000 warrants to purchase common stock at a price of
         $0.50 per share were issued to the investors. The warrants expire three
         years from the date of issuance.

         Warrants
         --------
         The Company has issued common stock warrants to officers of the Company
         as part of certain financing transactions (see Note 6). The Company has
         also issued  warrants as part of the issuance of common stock (see this
         Note 8).

         The fair market value of warrants issued during the quarter ended April
         30,  2005  in  conjunction  with  the  issuance  of  common  stock  was
         determined to be $312,122 and was  calculated  under the  Black-Scholes
         option pricing model with the following assumptions used:

                  Expected life                         3 years
                  Risk free interest rate               4.01%
                  Volatility                            199.8%
                  Expected dividend yield               None

         The fair value of these  warrants has been recorded as both a debit and
         credit to additional paid in capital.

         The following  table  presents  warrant  activity from January 31, 2005
         through April 30, 2005:

                                                                   Weighted-
                                                                   Average
                                                     Number        Exercise
                                                     of Shares       Price

                  Outstanding, January 31, 2005      11,724,583    $   0.16
                    Granted                           1,500,000    $   0.43

                      Outstanding, April 30, 2005    13,224,583    $   0.19
                      Exercisable, April 30, 2005    13,224,583    $   0.19

                                       14
<PAGE>

NOTE 9 - RELATED PARTY TRANSACTIONS

         Loans from officers
         -------------------
         During prior periods,  the Chief Executive  Officer and Chairman of the
         Company, loaned the Company an aggregate of $1,422,587. As of April 30,
         2005 the net principal  balance owing to him was $1,422,587 and accrued
         interest payable was $449,931. See Note 6.

         During prior periods,  the Chief Financial Officer and Secretary of the
         Company,  loaned the Company an aggregate of $209,251.  As of April 30,
         2005 the net  principal  balance  owing to him was $209,251 and accrued
         interest payable was $9,858. See Note 6.

         Accrued Payroll and Expenses Owed to Officers
         ---------------------------------------------
         As of April 30, 2005 the Company owed the Chief  Financial  Officer and
         Secretary of the Company  $93,500 for back wages and $6,000 for accrued
         expenses.






































                                       15
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

CAUTION ABOUT FORWARD-LOOKING STATEMENTS

This Form 10-QSB includes  "forward-looking"  statements  about future financial
results, future business changes and other events that haven't yet occurred. For
example,  statements like the Company "expects," "anticipates" or "believes" are
forward-looking  statements.  Investors  should be aware that actual results may
differ materially from the Company's expressed expectations because of risks and
uncertainties  about the future.  The Company  does not  undertake to update the
information in this Form 10-QSB if any forward-looking statement later turns out
to be inaccurate. Details about risks affecting various aspects of the Company's
business  are  discussed  throughout  this Form 10-QSB and should be  considered
carefully.

PLAN OF OPERATION FOR THE NEXT TWELVE MONTHS

Certain key factors that have affected our  financial  and operating  results in
the past will affect our future financial and operating results.  These include,
but are not limited to the following:

     o   Gold prices, and to a lesser extent, silver prices;

     o   Current gold  deposits  under our control at the Relief Canyon Mine are
         estimated by us (based on past  exploration by Newgold and work done by
         others).

         Our  properties  now include 78 unpatented  mining claims  contained in
         about 1000 acres.

         Our  operating  plan is to place  our  mining  claims  into  profitable
         production  by the end of fiscal 2006,  and use the net  proceeds  from
         these  operations to fund ongoing  exploration  and  development of our
         property  holdings.  Through  the  use of  joint  ventures,  royalties,
         arrangements and partnerships,  we intend to progressively  enlarge the
         scope  and  scale of the  mining  and  processing  operations,  thereby
         increasing both our annual revenues and ultimately our net profits. Our
         objective is to achieve  annual growth rates in revenue and net profits
         for the foreseeable future;

     o   We expect to make capital  expenditures  in fiscal year 2006 of between
         $2.5 million and $4 million,  including costs related to the resumption
         of mine operations and production at the Relief Canyon mine.

     o   Due to the  strengthening  of the gold market,  and consistent with our
         exploration  growth  strategy,  we  expect  exploration,  research  and
         development  expenditures  in 2005 will total  between  $500,000 and $1
         million.

     o   Additional funding or the utilization of other venture partners will be
         required for mining operations,  exploration, research, development and
         operating  expenses.  In the past we have been dependent on the funding
         from the  private  placement  of our  securities  as well as loans from
         related parties as the sole sources of capital to fund operations.

                                       16
<PAGE>

RESULTS OF OPERATION

We have only recently  resumed  business  operations  after having been inactive
from July 2001  until  February  2003.  Consequently,  we are in the  process of
reinstituting our business and mining operations,  the results of operations for
the last two fiscal years will likely not be indicative of Newgold's current and
future operations. The current management discussion and analysis should be read
from the context of Newgold's recent resumption of its mining business.

Operating Results for the Fiscal Quarters Ended April 30, 2005 and 2004

Although the Company commenced efforts to re-establish its mining business early
in fiscal year 2004, no mining  operations  have  commenced and no revenues have
been recognized during the quarters ended April 30, 2005 and 2004, respectively.
The  Company  hopes  to be able to  commence  generating  revenues  from  mining
operations  during  the 2006  fiscal  year.  The  Company  has  granted a 4% net
smelting  return  royalty to a third party  related to the Relief  Canyon mining
property which has been recorded as an $800,000 deferred option income.

During the quarter ended April 30, 2005 the Company spent $29,000 on exploration
expenses  related to the Relief Canyon  mining  property.  Exploration  expenses
expended  during  the same  quarter  ended  April 30,  2004 were  $5,000.  These
expenses  relate  primarily  to  maintenance  and  retention  costs  required to
maintain the Company's mining claims. The Company incurred operating expenses of
$202,880  during the  quarter  ended April 30,  2005.  Of this  amount,  $93,500
reflects  officer  compensation  and related  payroll  taxes during the quarter,
$22,323  reflect  promotional  expense  and  $59,848  reflect  fees for  outside
professional  services.  A large  portion of the outside  professional  services
reflects legal and accounting work pertaining to Newgold's annual report on Form
10-KSB for fiscal year 2005 and for the amended  annual  report on Form 10-KSB/A
for fiscal  year 2004.  During the  quarter  ended  April 30,  2004 the  Company
incurred  operating  expenses  of $75,375 of which  $55,000  represents  officer
compensation,  $8,190 reflecting  payroll penalties and $11,000 reflect fees for
outside professional services. It is anticipated that both exploration costs and
operating expenses will increase significantly as the Company resumes its mining
operations and exploration program.

The Company incurred interest expense of $356,824 during the quarter ended April
30, 2005 which compares to interest expenses of $47,565 incurred during the same
quarter ended April 30, 2004.  Although the amount of loans  outstanding  during
the first  quarter  of fiscal  2006 only  increased  by  approximately  $220,000
compared  to the first  quarter  of fiscal  2005,  the  increase  in  additional
interest  expense was  primarily  due to the  increase in  accretion of warrants
issued in October 2004 as a debt discount.

The Company's  total net loss for the quarter ended April 30, 2005  increased to
$588,704  compared to a net loss of $127,940 incurred for the same quarter ended
April 30,  2004.  The larger net loss in the current  fiscal year  reflects  the
substantial  increase in operating  expenses  and interest  expense as well as a
lack of revenues recognized during the first quarter of fiscal year 2006.



                                       17
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

The Company has incurred significant operating losses during the last two fiscal
years and during the  quarter  ended  April 30,  2005 which has  resulted  in an
accumulated  deficit of $16,974,006 as of the end of the first quarter of fiscal
year 2006. At April 30, 2005,  the Company had cash and other current  assets of
$245,848 and a net working capital  deficit of $3,841,930.  Since the resumption
of its business in February  2003, the Company has been dependent on borrowed or
invested funds in order to finance its ongoing operations. As of April 30, 2005,
the Company  had  outstanding  notes  payable in the gross  principal  amount of
$1,855,375 (net balance of $1,327,147  after $528,228 of note payable  discount)
which  reflects an increase of $219,445  compared to notes  payable in the gross
principal  amount of $1,635,930 (net balance of $1,593,840 after $42,090 of note
payable discount) as of April 30, 2004.

As of  April  30,  2005,  we were in  default  on two  promissory  notes  due to
unrelated parties in the principal amounts of $19,844 and $176,500.

In the quarter ended April 30, 2005 Newgold  raised a total of $575,000  through
the sale of 2,500,000 shares of its restricted stock.

By   attempting  to  resume   mining   operations,   the  Company  will  require
approximately  $3 million to $5 million in additional  working capital above the
current working capital deficiency to bring the mine into full production. It is
the  Company's  intention  to  pursue  several  possible  funding  opportunities
including the sale of additional securities or the incurring of additional debt.

Due to the  Company's  continuing  losses  from  its  business  operations,  the
independent  auditor's  report dated April 15, 2005,  includes a "going concern"
explanation  relating to the fact that the Company's  continuation  is dependent
upon  obtaining   additional   working  capital  either  through   significantly
increasing  revenues  or  through  outside  financing.  As of  April  30,  2005,
Newgold's  principal   commitments   included  its  obligation  to  pay  ongoing
maintenance fees on its 78 unpatented mining claims.

Due to the Company's limited cash flow,  operating losses and limited assets, it
is unlikely  that the Company  could  obtain  financing  through  commercial  or
banking  sources.  Consequently,  the Company is  dependent on  continuous  cash
infusions from its major  stockholders or other outside sources in order to fund
its current  operations.  If these investors were unwilling or unable to provide
necessary working capital to the Company, the Company would probably not be able
to  commence  or  sustain  its  operations.  There is no  written  agreement  or
contractual  obligation  which would  require the  Company's  investors  to fund
Company  operations  up to a certain  amount or indeed  continue  to finance the
Company's operations at all.

Management of the Company believes that it will need to raise additional capital
to  continue  to  develop,  promote  and  conduct  its mining  operations.  Such
additional  capital may be raised through public or private financing as well as
borrowing  from other  sources.  To date,  the  Company's  President  has paid a
substantial  portion of the Company's  expenses since restarting its business in
February 2003.  Although the Company believes that these creditors and investors
will continue to fund the Company's  expenses based upon their  significant debt
or equity  interest


                                       18
<PAGE>

in Newgold,  there is no assurance  that such investors will continue to pay the
Company's expenses.  If adequate funds are not otherwise available,  the Company
would not be able to establish or sustain mining operations.

Off-Balance Sheet Arrangements
------------------------------
During the fiscal  quarter  ended April 30, 2005,  the Company did not engage in
any  off-balance  sheet  arrangements  as  defined  in Item  303(c) of the SEC's
Regulation S-B.

FACTORS AFFECTING FUTURE OPERATING RESULTS

Newgold has been relatively inactive since April 2001. Consequently,  it is only
recently  reactivating  its business  operations  and has generated no revenues,
other than dividend income, since its inception. As a result, Newgold has only a
limited   operating   history  upon  which  to  evaluate  its  future  potential
performance.  Newgold's  prospects  must be considered in light of the risks and
difficulties  encountered by new companies which have not yet established  their
business operations.

Newgold  will need  additional  funds to  finance  its  mining  and  exploration
activities as well as fund its current operations. It currently has limited cash
reserves and a working capital deficit and is unable to fund its operations from
revenues.  Consequently,  its ability to meet its  obligations  in the  ordinary
course of business is dependent upon its ability to raise  additional  financing
through public or private equity financings, establish increasing cash flow from
operations,  enter into joint  ventures  or other  arrangements  with  corporate
sources, or secure other sources of financing to fund operations.

The audit report of Newgold's  independent  auditors  includes a "going concern"
qualification. In the auditor's opinion, Newgold's limited operating history and
the accumulated  shareholders' deficit as of January 31, 2005, raise substantial
doubt about its ability to continue as a going concern.

The price of gold has  experienced  an  increase  in value  over the past  three
years,  generally  reflecting among other things declining interest rates in the
United States;  worldwide  instability  due to terrorism;  and a global economic
slump. Any significant  drop in the price of gold may have a materially  adverse
affect on the results of Newgold's operations unless it is able to offset such a
price drop by substantially increased production.


Newgold's  disclosures of its mineral resources are only estimates.  Newgold has
no proven or probable  reserves and has no ability to currently measure or prove
its reserves other then estimating such reserves relying on information produced
in the 1990's and thus may be unable to actually  recover  the  quantity of gold
anticipated.  Newgold can only estimate a potential  mineral resource which is a
subjective  process which  depends in part on the quality of available  data and
the  assumptions  used and judgments made in  interpreting  such data.  There is
significant  uncertainty in any resource  estimate such that the actual deposits
encountered  or reserves  validated  and the  economic  viability  of mining the
deposits may differ materially from


                                       19
<PAGE>

Newgold's estimates.

Gold  exploration  is highly  speculative  in nature.  Success in exploration is
dependent  upon a number of factors  including,  but not limited to,  quality of
management, quality and availability of geological expertise and availability of
exploration  capital.  Due to these and other factors, no assurance can be given
that Newgold's  exploration programs will result in the discovery of new mineral
reserves or resources.


Newgold's  mining property rights consist of 78 mill site and unpatented  mining
claims.  The validity of  unpatented  mining  claims is often  uncertain  and is
always  subject to contest.  Unpatented  mining claims are generally  considered
subject to greater  title risk than  patented  mining  claims,  or real property
interests  that are owned in fee simple.  If title to a  particular  property is
successfully challenged, Newgold may not be able to retain its royalty interests
on that property, which could reduce its future revenues.


Mining is  subject  to  extensive  regulation  by state and  federal  regulatory
authorities.  State and federal statutes regulate environmental quality, safety,
exploration  procedures,  reclamation,  employees'  health  and  safety,  use of
explosives, air quality standards,  pollution of stream and fresh water sources,
noxious odors, noise, dust, and other environmental  protection controls as well
as the  rights of  adjoining  property  owners.  Newgold  believes  that,  it is
currently  operating  in  compliance  with all known  safety  and  environmental
standards and regulations applicable to its Nevada property.  Currently, Newgold
is only  permitted to carry on  designated  mining  activities  until it posts a
reclamation  bond and the mining  property is brought into  compliance  with the
requirements of the Nevada  Department of Environmental  Protection.  Permitting
Newgold's mining property for full exploration and mining activities is expected
to take 6 to 15 months.  However, there can be no assurance that permits will be
granted  or that  future  changes  in federal  or Nevada  laws,  regulations  or
interpretations  thereof  will not have a material  adverse  affect on Newgold's
ability to resume and sustain mining operations.



The  business  of gold  mining is subject to certain  types of risks,  including
environmental  hazards,  industrial  accidents,  and theft.  Prior to suspending
operations,  Newgold  carried  insurance  against  certain  property damage loss
(including business interruption) and comprehensive general liability insurance.
While Newgold maintained insurance consistent with industry practice,  it is not
possible to insure against all risks  associated  with the mining  business,  or
prudent to assume that  insurance  will continue to be available at a reasonable
cost. Newgold has not obtained  environmental  liability  insurance because such
coverage is not considered by management to be cost effective. Newgold currently
carries no insurance on any of its  properties  due to the current status of the
mine and Newgold's current financial condition.


Newgold is  substantially  dependent  upon the  continued  services  of A. Scott
Dockter,  its President.  Newgold has no employment  agreement with Mr. Dockter,
nor is there  either key person life  insurance or  disability  insurance on Mr.
Dockter. While Mr. Dockter expects to


                                       20
<PAGE>

spend the majority of his time assisting Newgold, there can be no assurance that
Mr.  Dockter's  services  will remain  available  to Newgold.  If Mr.  Dockter's
services are not available to Newgold,  Newgold will be materially and adversely
affected.  However,  Mr.  Dockter has been a significant  shareholder of Newgold
since its inception and considers his investment of time and money in Newgold of
significant personal value.


CRITICAL ACCOUNTING POLICIES

Newgold's  discussion  and analysis of its financial  conditions  and results of
operations are based upon its financial statements,  which have been prepared in
accordance with generally accepted  accounting  principles in the United States.
The preparation of financial  statements  requires  management to make estimates
and disclosures on the date of the financial  statements.  On an on-going basis,
Newgold evaluates its estimates, including, but not limited to, those related to
revenue recognition. The Company uses authoritative  pronouncements,  historical
experience  and other  assumptions  as the basis for  making  judgments.  Actual
results could differ from those  estimates.  Newgold believes that the following
critical accounting policies affect its more significant judgments and estimates
in the preparation of its financial statements.

Valuation of long-lived assets
------------------------------

Long-lived assets,  consisting primarily of property and equipment,  patents and
trademarks, and goodwill,  comprise a significant portion of the Company's total
assets. Long-lived assets are reviewed for impairment whenever events or changes
in  circumstances  indicate that their carrying  values may not be  recoverable.
Recoverability of assets is measured by a comparison of the carrying value of an
asset to the future net cash flows expected to be generated by those assets. The
cash flow projections are based on historical  experience,  management's view of
growth  rates  within  the  industry,   and  the  anticipated   future  economic
environment.

Factors Newgold  considers  important that could trigger a review for impairment
include the following:

         (a)  significant  underperformance  relative to expected  historical or
              projected future operating results,

         (b)  significant  changes  in the  manner  of its  use of the  acquired
              assets or the strategy of its overall business, and

         (c)  significant negative industry or economic trends.

When the Company  determines  that the carrying  value of long-lived  assets and
related goodwill and enterprise-level goodwill may not be recoverable based upon
the existence of one or more of the above indicators of impairment,  it measures
any impairment based on a projected discounted cash flow method using a discount
rate determined by its management to be  commensurate  with the risk inherent in
its current business model.




                                       21
<PAGE>

Deferred Reclamation Costs
--------------------------

In August  2001,  the  Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting  Standards ("SFAS") No. 143,  "Accounting for
Asset  Retirement  Obligations,"  which  established a uniform  methodology  for
accounting for estimated  reclamation and abandonment  costs.  The statement was
adopted  February 1, 2003.  The  reclamation  costs will be allocated to expense
over the life of the related  assets and will be adjusted for changes  resulting
from the  passage  of time and  revisions  to either the timing or amount of the
original present value estimate.

Prior to adoption of SFAS No. 143, estimated future reclamation costs were based
principally on legal and regulatory  requirements.  Such costs related to active
mines were accrued and charged over the  expected  operating  lives of the mines
using the UOP method based on proven and probable  reserves.  Future remediation
costs for inactive mines were accrued based on management's best estimate at the
end of each period of the undiscounted  costs expected to be incurred at a site.
Such cost estimates included,  where applicable,  ongoing care,  maintenance and
monitoring  costs.  Changes in  estimates  at inactive  mines were  reflected in
earnings in the period an estimate was revised.

Exploration Costs
-----------------

Exploration  costs are  expensed  as  incurred.  All costs  related to  property
acquisitions are capitalized.

Mine Development Costs
----------------------

Mine development  costs consist of all costs associated with bringing mines into
production, to develop new ore bodies and to develop mine areas substantially in
advance  of  current  production.  The  decision  to  develop a mine is based on
assessment of the commercial  viability of the property and the  availability of
financing.  Once the decision to proceed to development is made, development and
other expenditures  relating to the project will be deferred and carried at cost
with the intention that these will be depleted by charges against  earnings from
future mining  operations.  No depreciation will be charged against the property
until  commercial  production  commences.  After a mine  has been  brought  into
commercial production,  any additional work on that property will be expensed as
incurred,  except for large  development  programs,  which will be deferred  and
depleted.

Reclamation Costs
-----------------

Reclamation  costs  and  related  accrued  liabilities,  which  are based on the
Company's  interpretation of current environmental and regulatory  requirements,
are accrued and expensed, upon determination.

Based on current environmental  regulations and known reclamation  requirements,
management  has  included  its  best  estimates  of  these  obligations  in  its
reclamation accruals. However, it is


                                       22
<PAGE>

reasonably   possible  that  the  Company's   best  estimates  of  its  ultimate
reclamation  liabilities  could change as a result of changes in  regulations or
cost estimates.

Recent Accounting Pronouncements
--------------------------------
In March 2005, the FASB issued FASB  Interpretation  ("FIN") No. 47, "Accounting
for Conditional  Asset  Retirement  Obligations".  FIN No. 47 clarifies that the
term conditional asset retirement  obligation as used in FASB Statement No. 143,
"Accounting for Asset Retirement  Obligations,"  refers to a legal obligation to
perform an asset  retirement  activity  in which the  timing and (or)  method of
settlement  are  conditional on a future event that may or may not be within the
control of the entity.  The obligation to perform the asset retirement  activity
is unconditional even though uncertainty exists about the timing and (or) method
of  settlement.  Uncertainty  about the timing  and/or method of settlement of a
conditional asset retirement  obligation should be factored into the measurement
of the liability when sufficient  information  exists.  This interpretation also
clarifies  when an  entity  would  have  sufficient  information  to  reasonably
estimate  the fair  value  of an  asset  retirement  obligation.  FIN No.  47 is
effective no later than the end of fiscal  years ending after  December 15, 2005
(December 31, 2005 for calendar-year  companies).  Retrospective  application of
interim financial information is permitted but is not required.  Management does
not expect  adoption  of FIN No. 47 to have a material  impact on the  Company's
financial statements.

ITEM 3.  CONTROLS AND PROCEDURES

The  Company  carried  out an  evaluation,  under the  supervision  and with the
participation of the Company's management, including the Company's President and
Chief Executive Officer along with the Company's Chief Financial Officer, of the
effectiveness of the design and operation of the Company's  disclosure  controls
and procedures  pursuant to Exchange Act Rule 13a-14 as of the end of the period
covered by this report. Based upon that evaluation,  the Company's President and
Chief  Executive  Officer  along  with the  Company's  Chief  Financial  Officer
concluded that the Company's disclosure controls and procedures are effective to
ensure the information  required to be disclosed by the Company in reports filed
or submitted under the Exchange Act were timely recorded, processed and reported
within the time periods  specified  in the  Securities  and Exchange  Commission
rules and forms.

There have been no significant  changes in the Company's  internal controls over
financial  reporting or in other factors which occurred  during the last quarter
covered by this report,  which could materially  affect or are reasonably likely
to materially affect the Company's internal controls over financial reporting.













                                       23
<PAGE>

                           PART II - OTHER INFORMATION

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

SALES OF UNREGISTERED SECURITIES DURING THE QUARTER

In February 2005 the Company  issued  500,000 shares of commons stock at a price
of $0.15 per share to an investor for total  proceeds of $75,000.  Additionally,
500,000  warrants  to purchase  common  stock at a price of $0.30 per share were
issued  to the  investor.  The  warrants  expire  three  years  from the date of
issuance.  The shares were offered and sold exclusively to individuals  residing
or  entities  formed  outside  the United  States and are not deemed to be "U.S.
persons" as that term is defined  under  Regulation S of the  Securities  Act of
1933 (the "1933 Act").  Each investor  represented  that it is  purchasing  such
shares for its own  account.  Both the offer and the sale of the Newgold  shares
were made outside the United States and are deemed to be "offshore transactions"
as that term is defined  under  Regulation S. The share  certificate  contains a
legend  indicating  that such shares can only be transferred in compliance  with
the  provisions  of  Regulation  S. In light of the  foregoing,  such sales were
deemed  exempt from  registration  pursuant to Regulation S of the 1933 Act. The
shares are deemed to be "restricted securities" as defined in Rule 144 under the
1933 Act.

In April 2005 the Company issued 2,000,000 shares of commons stock at a price of
$0.25 per share to  investors  for total  proceeds  of  $500,000.  Additionally,
1,000,000  warrants to purchase  common stock at a price of $0.50 per share were
issued to the  investors.  The  warrants  expire  three  years  from the date of
issuance.  1,000,000  of  the  shares  were  offered  and  sold  exclusively  to
individuals  residing or entities  formed  outside the United States and are not
deemed to be "U.S.  persons" as that term is defined  under  Regulation  S. Each
investor represented that it is purchasing such shares for its own account. Both
the offer and the sale of the Newgold shares were made outside the United States
and are  deemed to be  "offshore  transactions"  as that term is  defined  under
Regulation  S. The share  certificate  contains  a legend  indicating  that such
shares can only be transferred  in compliance  with the provisions of Regulation
S. In light of the  foregoing,  such sales were deemed exempt from  registration
pursuant  to  Regulation  S of  the  1933  Act.  The  shares  are  deemed  to be
"restricted securities" as defined in Rule 144 under the 1933 Act. The issuances
of the other 1,000,000  shares were made without any public  solicitation to two
investors  and were acquired for  investment  purposes  only.  The investors had
access to information  about Newgold and were deemed capable of protecting their
own interests. The issuance of the stock and warrants were made in reliance upon
the exemption from  registration  set forth in Section 4(2) of the 1933 Act as a
transaction not involving a public  offering.  The stock and warrants are deemed
to be "restricted securities" as defined in Rule 144 under the 1933 Act.

Prior issuances of the Company's  common stock during fiscal years 2005 and 2004
have been  reported in the  Company's  prior  filings  with the  Securities  and
Exchange Commission.

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<PAGE>

ITEM 5.  OTHER INFORMATION

Effective   June  7,  2005  Newgold  was  cleared  to  resume   trading  on  the
Over-the-Counter  Bulletin Board trading  service.  Newgold's  trading symbol is
NGLD.

ITEM 6.  EXHIBITS

             31.1 Certification   of  CEO   pursuant   to  Section  302  of  the
                  Sarbanes-Oxley Act of 2002.

             31.2 Certification   of  CFO   pursuant   to  Section  302  of  the
                  Sarbanes-Oxley Act of 2002.

             32.  Certification  by CEO and CFO  pursuant  to Section 906 of the
                  Sarbanes- Oxley Act of 2002











































                                       25
<PAGE>



                                   SIGNATURES

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

Dated:  June 10, 2005                       NEWGOLD, INC.


                                  /s/SCOTT DOCKTER
                                  ----------------------------------------------
                                  Scott Dockter, President and Chief Executive
                                  Officer


                                  /s/JAMES KLUBER
                                  ----------------------------------------------
                                  James Kluber, Principal Accounting Officer and
                                  Chief Financial Officer




































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