# UNITED STATES SECURITIES AND
EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K

(Mark One)

[ X] ANNUAL REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE PERIOD FROM BLANK TO DECEMBER 31, 2007

GOLDEN EAGLE
INTERNATIONAL, INC. (Exact name of the
Company as specified in its charter)

Colorado (State or other jurisdiction of incorporation or organization)

|                         |                                     
|------------------------ | ------------------------------------
|0-23726                  | 84-1116515                          
|(Commission File Number) | (I.R.S. Employer Identification No.)

9661 South 700 East,
 Salt Lake City, Utah 84070        (Address
of principal executive offices) (Zip Code)

(801) 619-9320         (Registrant's
telephone number, including zip code)

Securities registered pursuant to
Section 12(b) of the Exchange Act:
                                                      (None)

Securities registered pursuant to
Section 12(g) of the Exchange Act:
                                                        [X]

Indicate by check mark if the
registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes [ ]          No [X]

Indicate by check mark if the
registrant is not required to file reports pursuant to Section 13 or Section 13(d) of the
Act. Yes [ ]           No [X]

Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Exchange Act during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X]         No [ ]

Indicate by check mark if disclosure
of delinquent filers pursuant to Item 405 of Regulation S-K is not contained in this
form, and will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. To the best of registrants' knowledge, there are no
disclosures of delinquent filers required in response to Item 405 of Regulation S-K. Yes
[X]         No [ ]

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or
a smaller reporting company. See the definitions of "large accelerated filer",
"accelerated filer" and "small reporting company" in Rule 12b-2 of the Exchange Act.
(Check one): 

 Large accelerated filer [ ]   Accelerated filer [ ]   Non-accelerated filer [ ] Smaller reporting company [X]

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

As of April 11, 2008, the aggregate market value of the voting and nonvoting common equity held by non-affiliates
of Golden Eagle International, Inc. was approximately      $9,263,494. This estimate is based on the last sale
price per share of $.0068 on April 11, 2008 on the OTCBB, and  1,362,278,574 shares estimated to be held by
non-affiliates.

Issuer's revenues for its most recent fiscal year: $0

The number of shares of the registrant's $.0001 par value common stock outstanding as of April 11, 2008 was
1,872,401,108.

---

|                  |                                                                                                              |             
|----------------- | ------------------------------------------------------------------------------------------------------------ | ------------
|                  |                                                                                                              |             
|Table of Contents
|                  |                                                                                                              | Page No.    
|PART I           
|                  |                                                                                                              |             
|Item 1.           | Business                                                                                                     | 3           
|Item 1A.          | Risk Factors                                                                                                 | 12          
|Item 2.           | Properties                                                                                                   | 16          
|Item 3.           | Legal Proceedings                                                                                            | 23          
|Item 4.           | Submission of Matters to a Vote of Security Holders                                                          | 25          
|                  |                                                                                                              |             
|PART II          
|                  |                                                                                                              |             
|Item 5.           | Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 26          
|Item 6.           | Selected Consolidated Financial Data                                                                         | 31          
|Item 7.           | Management's Discussion and Analysis of Financial Condition and Results of Operation                         | 31          
|Item 7A.          | Quantitative and Qualitative Disclosures About Market Risk                                                   | 45          
|Item 8.           | Financial Statements and Supplementary Data                                                                  | 46          
|Item 9.           | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                         | 46          
|Item 9A.          | Controls and Procedures                                                                                      | 46          
|Item 9B.          | Other Information                                                                                            | 46          
|                  |                                                                                                              |             
|PART III         
|                  |                                                                                                              |             
|Item 10.          | Directors and Executive Officers of the Registrant                                                           | 46          
|Item 11.          | Executive Compensation                                                                                       | 52          
|Item 12.          | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters               | 55          
|2                
|Item 13.          | Certain Relationships and Related Transactions                                                               | 58          
|Item 14.          | Principal Accountant Fees and Services                                                                       | 60          
|                  |                                                                                                              |             
|PART IV          
|                  |                                                                                                              |             
|Item 15.          | Exhibits, Financial Statement Schedules                                                                      | (F-1)-(F-33)
|                  | Signatures                                                                                                   | 63-64       

Forward-Looking Statements

This Annual Report on Form 10-K,
including our Managements Discussion of Results of Operations on page
31, contains forward-looking statements that involve risks and uncertainties, as well as
assumptions that, if they never materialize or prove incorrect, could cause the results of
Golden Eagle International, Inc. to differ materially from those expressed or implied by
such forward-looking statements. The words or phrases would be, will
allow, intends to, will likely result, are expected
to, will continue, is anticipated, estimate,
project, or similar expressions are intended to identify forward-looking
statements. Our operations are subject to significant risks and uncertainties,
including, but not limited to, certain risk factors, which are described in more detail
under Risk Factors beginning on page 12. All statements, other than statements
of historical fact, are statements that could be deemed forward-looking statements,
including any projections of revenue, gross margin, expenses, earnings or losses from
operations, synergies or other financial items, any statements of managements plans,
strategies and objectives for future operations, and any statement concerning
developments, plans, or performance. Unless otherwise required by applicable law, we do
not undertake, and we specifically disclaim any obligation to update, any forward-looking
statements to reflect occurrences, developments, unanticipated events or circumstances
after the date of such statement.

Golden Eagle International, Inc. is
referred to herein as we, our, or us.

# PART 1

# Item 1. Business

# General

# How We Are Organized

3

We were formed as a Colorado
corporation on July 21, 1988 as Beneficial Capital Financial Services Corp. On February 2,
1995, we changed our name to Golden Eagle International, Inc. Our subsidiaries are:

|                                                                        |                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|----------------------------------------------------------------------- | ----------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name (percent ownership)                                                | Jurisdiction (date) of Organization | Description of Activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Golden Eagle International, Inc. Bolivia ("Golden Eagle Bolivia")(100%) | Bolivia (2001)                      | This subsidiary holds all concession-mining rights
                                  granted by the Bolivian government as described
                                  below in more detail. This subsidiary is also the
                                                                  owner of all of our assets in Bolivia, having
                                                                  received them from a related entity, Golden Eagle
                                                                  Bolivia Mining, S.A during 2002 in our effort to
                                                                  consolidate all interests, assets and operations
                                                                  into one wholly owned subsidiary.

# Business Overview

Our corporate headquarters are in
Salt Lake City, Utah

We are engaged in minerals
exploration operations in Bolivia through our Bolivian based wholly owned subsidiary,
Golden Eagle International, Inc. (Bolivia). We have acquired the following mineral
prospects in Bolivia:

|                          |               |       
|------------------------- | ------------- | ------
|Tipuani-Cangalli prospect | Number Acres  | Status
|Cangalli claims           | 5,000 acres   | Owned 
|Tipuani prospect          | 7,000 acres   | Owned 
|                          |               |       
|Precambrian Shield        |               |       
|Precambrian prospect      | 111,500 acres | Owned 
|Buen Futuro claim         | 2,500 acres   | Owned 
|Cobra claim               | 22,500 acres  | Owned 

Additionally, we own the following
gold processing and milling plant

|                        |                |       
|----------------------- | -------------- | ------
|Plant and Mill          | Location       | Status
|Gold Bar Plant and Mill | Eureka, Nevada | Owned 

None of our prospects are currently
in the production stage. Our production operations on our Cangalli property ceased in June
2004 as a result of a local farmers strike and certain legal issues particular to
Bolivia with which we were not associated. Our Precambrian B and C Zone prospects are in
the development stage; our Buen Futuro A Zone prospect is in the exploration stage.

4

For the years ended December 31, 2007
and 2006, we reported net losses of $6,377,636 and $4,275,892, respectively. Our financial
results over the past two years have been impacted by the shutdown of our production
operations as discussed under Item 7 in connection with our financial results for the
years ended December 31, 2007 and 2006.

This map shows the location of our
prospects and properties.

The mining measures we use throughout
this Form 10-K reflect accepted Bolivian mining weights and measures such as grams, troy
ounces, and metric tonnes that are not commonly used in the United States. All references
to ounces will be to troy ounces whether or not so specified; all references
to tonnes will be to metric tonnes, whether or not so specified. The following conversion
chart compares Bolivian measures to United States commonly used weights.

|                                                                                    |                                                                                                                          
|----------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------
|Commonly Used Weights in Gold Exploration                                           | Conversion into Avoirdupois Weights Commonly Used in the United
                                                   States
|1 troy ounce = 31.1035 grams                                                        | 1 troy ounce = 1.097 ounces                                                                                              
|32.15 troy ounces = 1 kilogram
32,150 troy ounces = 1000 kilograms = 1 metric
tonne | 14.583 troy ounces = 16 avoirdupois ounces = 1 pound  29,166 troy ounces = 1 avoirdupois ton                             

5

# Business Development

i.    
          C Zone gold operation. Our current plan entails completing
construction of the C Zone plant and commencing commercial mining operations at the C Zone
during the second quarter of 2008. During 2007, we completed exploration and feasibility
work on the gold mineralization of the B and C Zones of our Precambrian properties in
eastern Bolivia, which are located approximately 5 kilometers (3.1 miles) from the A Zone
of our Buen Futuro project. Additionally, we built and operated a pilot plant on the C
Zone, which we have used to refine the metallurgical process on the mineralization in the
zone. During September 2007, as a result of environmental issues, we moved the location of
our production plant approximately 700 meters (2,300 feet) to the southwest of our pilot
plant to eliminate the potential impact on a nearby marshland and to permit the potential
capacity of our plant to increase to 2,000 tonnes per day (hereafter referred to as
tpd) from the original 1,000 tpd of our original plant design. On November 30,
2007, we held a public hearing in Bolivia regarding our environmental permit at which time
we received no negative public comments, which permitted us to clear final regulatory
requirements to enable us to commence construction on the new production plant. At
approximately the same time, we began experiencing torrential rains in the area that far
exceeded the normal rainfall for this region, referred by meteorologists as the
100-year rains. These rains have severely limited our ability to complete
construction on the plant due to road conditions in the region and our inability to pour
concrete. Once we have a period of dry weather we intend to finalize construction on the
plant and begin construction starting at approximately 200 tpd and increasing to 2,000
tpd. We intend to use a contract mining company to deliver the ore from our C Zone mine
directly to our mill. The contract miner estimates that it can mine and deliver ore at a
cost of $2.00 per tonne if and when we have reached 2,000 tonnes per day. The use of a contract
miner will eliminate the capital costs required to purchase mining equipment.

ii.    
          Mine Camp for A & C Zone Development. During 2007, we completed
construction of our mine camp situated between our A Zone development and the C Zone mine
and mill. The mine camp includes dormitories, dining hall, sanitation facilities,
administration buildings and warehouses and serves as camp for the construction and
operation of the C Zone mill and the exploration and development of our A Zone project.

iii.    
          A Zone Buen Futuro gold and copper project. Our current strategy is to further
develop the potential of the A Zone of our Buen Futuro gold and copper project in eastern
Bolivia during 2008. In February 2007, we entered into an agreement with a major
independent mining and engineering firm, Washington Group International, Inc.
(www.wgint.com), to perform the necessary due diligence work to advise us regarding our
feasibility studies. Additionally, we may engage this engineering firm to determine if our
Gold Bar mill and plant should be moved to our A Zone Buen Futuro project in eastern
Bolivia, or if a new mill and plant should be built on site. During this period we will
also begin securing final environmental permitting and any additional surface land
acquisitions that may be required for the A Zone project.

6

iv. Gold Bar mill project.In 2004, we purchased the 3,500 to
4,500 tpd Gold Bar CIP gold mill located 25 mills northwest of Eureka, Nevada. 
During 2007 and 2008 to date, we have had under consideration various options regarding
the Gold Bar mill project, including:  a) dismantling the mill and shipping it to our
Buen Futuro A Zone project in Bolivia (if and when our feasibility work is concluded);  or b)
rehabilitating the mill for toll refining (which is defined as processing ore through our
plant for a fixed fee or toll that is produced by a third-party mining company from its
mine)on its current site and; or c) joint venturing the mill with other partners
that may be able to produce ore from their mines. All of the foregoing is contingent on
obtaining sufficient financing.

v.    
          Cangalli gold project. Finally, we intend to continue our
efforts to resolve issues impeding the development of our Cangalli mine; however, we will
not recommence operations at the Cangalli mine, if ever, until we begin operations on our
eastern Bolivian Precambrian properties.

To accomplish our strategy we intend
to accomplish the steps in our Plan of Operations, which are detailed beginning on page
40.

# Description of Business

# Principal products

We have produced only a single
product, gold metal, which we extracted from our Cangalli mining claims from September
2002 through June 2004, and small quantities of gold prior to September 2002. Our revenues
prior to 2005 from operations were derived solely from the sale of that gold. Although our
Buen Futuro prospect has copper and gold mineralization, we have only produced a small
amount of gold of negligible value from our C Zone pilot operations through 2007. We
generated no revenues from gold or copper production from 2005 to 2007.

# Gold

During 2006 and 2007, we had no sales
of gold. Gold production and sales prior to 2005 totaled 9,720 troy ounces as reflected in
the chart below titled, Activities at our Cangalli claims to generate
production.

Gold Uses. Gold has two main
categories of use: (a) product fabrication; and (b) investment. Fabricated gold has a
variety of end uses, including jewelry, electronics, dentistry, industrial and decorative
uses, medals, medallions and official coins. Gold investors buy gold bullion, official
coins and high-karat jewelry, and make equity investments in gold and precious metal
exploration/production companies.

7

# Copper

To date we have not produced any
copper. However, our exploration efforts at Buen Futuro indicate the potential of a
significant amount of copper in the mineralized material found there.

# Activities at our
Cangalli claims to generate production

The following table sets forth our
gold production history from our Cangalli claims, which has been our only source of
revenue to date:

|                        |                             |                  |            
|----------------------- | --------------------------- | ---------------- | -----------
|Years                   | Production/Inventory (g/oz) | Grade g/T (m(3)) | Revenues   
|                        |                             |                  |            
|1996-1999               | 21,000 g (675 oz)           | Exploration      | $   161,000
|2000-Third quarter 2002 | -                           | -                | -          
|Fourth quarter, 2002    | 43,847 g (1,410 oz)         | .475(.950)       | 481,620    
|First quarter, 2003     | 36,424 g (1,171 oz)         | .433 (.866)      | 137,196    
|Second quarter, 2003    | 37,841 g (1,217 oz)         | .424 (.848)      | 226,740    
|Third quarter, 2003     | 59,728 g (1,920 oz)         | .317 (.634)      | 631,325    
|Fourth quarter, 2003    | 39,246 g (1,262 oz)         | .403 (.806)      | 330,330    
|First quarter, 2004     | 30,493 g (980 oz)           | .412 (.824)      | 367,971    
|Second quarter, 2004    | 33,745 g (1,085 oz)         | .984 (1.97)      | 533,015    
|Third quarter, 2004     | -                           | -                | 228,037    
|Fourth quarter, 2004    | -                           | -                | 193,034    
|2005                    | -                           | -                | -          
|2006                    | -                           | -                | -          
|2007                    | -                           | -                | -          
|                        |                             |                  |            
|Total Production        | 302,324 g (9,720 oz)        | -                | $3,270,667 

As of December 31, 2007 and 2006, we
held no gold in inventory.

Gold production from our Cangalli
claims ceased in June 2004 because of a local farmers strike and then because of
legal issues that arose regarding parties not associated with us. We cannot guarantee that
production will ever recommence at our Cangalli gold mine or that we will ever further
explore or work our Cangalli or Tipuani Valley mining claims.

# Distribution methods.

Gold previously produced in Bolivia
was primarily sold into the Bolivian gold market and then on the international market. If
we are able to again produce gold, we plan that it will be sold into both the Bolivian and
international markets. If we are able to commence copper production, we anticipate that
our product will be distributed to international markets through Brazil, Chile and Peru.

8

# Status of publicly
announced products or services.

We have not publicly announced any
products or services; our business has been limited to conducting minerals exploration.

# Competitive business
conditions.

The gold and copper mining business
is extremely competitive. Our competitors have substantially greater financial,
technological, and human resources, and therefore greater potential to conduct successful
mining operations and generate revenues.

# Sources and availability
of raw materials.

As of December 31, 2007, we required
no significant raw materials. Our mining operations in Bolivia, from 2002 to
2004, required significant quantities of mining equipment and supplies. Such items
are often in short supply and deliveries are occasionally impeded by severe weather,
political strife, such as road blockades by the Bolivian Central Workers Union, the
National Farmers Organization, or other organized groups, and primitive road conditions.
Nevertheless, we were always able to meet our requirements. If we are able to bring our
Buen Futuro A Zone operation into production, we will require a large amount of electrical
power and certain chemicals, which we will need to source in the region and which may be
in short supply.

# Dependence on one or a
few major customers.

Our potential customers consist of
consumers through the domestic Bolivian and international spot gold and copper markets,
and an active gold and copper market in Bolivia and internationally for the jewelry
industry. As a result, should we be successful in bringing any of our prospects into gold
and copper production, we do not believe that we will be dependent upon any single
customer or even a few major customers.

# Patents, trademarks,
licenses, franchises and concessions.

We have no patents, trademarks,
licenses or franchises that are material to our business. However, we do have mining
claims that have been granted to us from the national Bolivian government, which are
discussed below under Item 2  Properties.

# Need for governmental
approval.

In Bolivia the mining industry is
subject to government approval, including mining, environmental and other activities that
require permitting; harvesting of lumber for mine timbers; clearing of forested areas for
the construction of open pit mines, mills and tailings impoundments; transport and storage
of explosives; and the transport and storage of hazardous substances and chemicals. We
have operated under a conditional use permit for the operation of our pilot plant on our C
Zone gold project. Because we plan to operate a full production plant, we were required to
obtain additional permitting. While we obtained the required permits to operate in the C
Zone, we can offer no assurances that the required permits will be forthcoming, or in a
timely manner, for both the A Zone Buen Futuro project, as well as the B Zone gold
project.

9

Our Gold Bar mill and plant located
outside of Eureka, Nevada is currently inactive. If we were to commence a toll processing
or joint venture operation at Gold Bar, we would be required to obtain numerous permits
from both the US Federal government and the State of Nevada, which would be time consuming
and expensive. We cannot assure that any such permits would be forthcoming, or forthcoming
in a timely manner, even if we did decide to commence operations at Gold Bar.

# Effect of existing or
probable governmental regulations.

During 2007, Bolivias current
administration expressed a desire to increase the Complimentary Mining Tax (Mining
Tax), or minerals severance tax, on all minerals and metals mined in Bolivia. The
current Bolivian Mining Tax is assessed at the time of sale or export of the mineral and
is based on a sliding scale derived from the quote for a particular mineral on the
international markets over any 15-day period. Every 15 days the Ministry of Mining and
Metallurgy in Bolivia certifies the price at which each mineral should be taxed.
Bolivias current Mining Tax is reasonable by world standards. The Mining Tax is then
deductible from a companys Net Profits Tax (25% on net profits after all
deductions have been taken) at the end of a companys fiscal year. We believe, but
cannot assure, that an increase in the Mining Tax may go into effect at some point in the
foreseeable future, however, due to the public reaction from the Bolivian mining community
to the administrations proposed increase, that outcome is uncertain.

The current administration has also
expressed a desire to increase the annual claim fees paid each year in mining patents for
mining concessions in Bolivia. In addition, the administration has expressed a desire to
change Bolivias mining law to require work to improve mining concessions as a
requirement to maintaining those concessions. Currently, under Bolivian mining law, if a
mining concession holder pays annual claim fees for patents there is no additional work
requirement. We are currently unsure whether these changes will take place in the near
future due to the public reaction from the Bolivian mining community to the
administrations proposed changes to the Bolivian Mining Code.

# Research and development
expenditures.

We have never assumed any research
and development expenses since our inception. We have not engaged in, and do not intend to
engage in, any research and development activities.

Effect of compliance with federal,
state, and local provisions for the protection of the environment.

10

We are not engaged in significant
operations within the United States other than our ownership of the Gold Bar mill and
plant located 25 miles northwest of Eureka, Nevada, which, as of December 31, 2007, was
idle. We do not own the ground on which this plant sits. The purchase agreement we entered
into when we purchased the plant requires the previous owner of the plant and the current
landowner, Atlas Precious Metals, Inc., to perform any required environmental remediation
on the site. We do not believe that we have any liability for environmental clean up on
this site or on any other site within the United States.

In Bolivia, we engage in an industry
that is historically subject to extensive, time consuming, and expensive compliance with
environmental law. Because we have limited financial resources, as well as limited
personnel, there is no assurance that we will be able to comply with environmental laws in
Bolivia; however, to date, we believe that we have complied with all environmental laws in
Bolivia.

We are also required to maintain
environmental permits to explore, operate pilot operations, mine, process ore and create
processing waste impoundments. From September 30, 2002 through March 2003, we mined in
Cangalli on the basis of conditional use permits. In March 2003, we received our permanent
environmental permits, which we intend to maintain in good standing. We are required to
provide the Bolivian Vice Ministry of the Environment and Natural Resources with ongoing
information regarding the environmental impact of our operations. In addition, we have
retained an engineering firm to monitor our Bolivian based subsidiarys compliance
with environmental laws in Bolivia and to produce any necessary reporting and filing. Our
ability to continue our mining activities depends on our compliance with Bolivian law and
with the conditions of our environmental permitting.

We also secured permits from the
Departmental Prefecture (State Government) for the exploration of our C Zone gold prospect
and for the operation of our pilot recovery plant on our C Zone. On November 30, 2007 a
public hearing was held in the township of Ascension de Guarayos as the final step to
secure from the Bolivian Vice Ministry of the Environment and Natural Resources our full
environmental operating permit for expanding our pilot operations to full commercial
operations.

As part of our process to commence
gold and copper mining operations at our Buen Futuro A Zone, we have retained an
international engineering firm to evaluate our feasibility study and to provide feedback
on our exploration, metallurgy, mine plan, and permitting efforts. We received a favorable
due diligence report from these engineers in January of 2008 recommending that we move to
a second stage of their feasibility work with a limited in-fill drilling and trenching
campaign anticipated to expand the A Zone gold and copper potential and to provide
additional metallurgical samples for analysis in laboratories in the U.S. We estimate that
such a campaign could cost between $600,000 and $1 million.

We believe that our environmental
permitting related efforts to adhere to applicable Bolivia regulations and procedures will
result in the required permits being issued in a timely manner.

11

# Employees.

At December 31, 2007, we directly
employed 16 full-time employees, as follows: (a) three in our head offices in Salt Lake
City, Utah including our Chief Executive Officer, Chief Financial Officer and our Director of Public Relations; and (b)
seven in our administrative offices in Santa Cruz, Bolivia; and (c) 6 at Ascension de
Guarayos, which are primarily involved in the exploration of the B and C Zones and
preparing infrastructure for the Buen Futuro A Zone, and B and C Zone projects. We also
routinely employ day workers at various times for specific projects at our Bolivian mine
sites.

# Reports to security
holders

# Annual report.

We are not required to deliver an
annual report to security holders and we will not be distributing an annual report.

# Available information

We are a Colorado corporation with
our principal executive offices located at 9661 South 700 East, Salt Lake City, Utah
84070. Our telephone number is: (801) 619-9320. Our fax number is: (801) 619-1747. Our
website address is www.geii.com. We file our annual, quarterly, and current reports
with the Securities and Exchange Commission (SEC), copies of which are available on our
website or from the SEC free of charge at www.sec.gov. The public may also read and
copy any materials, which we have filed with the SEC at the SECs Public Reference
Room at 450 Fifth Street N.W., Washington, D.C. 20549. Information on the Public Reference
Room may be obtained by calling: 1-800-SEC-0330. Our Code of Business Conduct and Ethics
is also available free of charge on our website or by faxing a request to us at: (801) 619-1747.

# Item 1A. Risk Factors

The following risks and
uncertainties, along with other information contained in this Form 10-K, should be
carefully considered by anyone considering an investment in our securities. The occurrence
of any of the following risks could negatively affect our business, financial condition
and operating results.

# FINANCIAL RISKS

Our history of losses and working
capital shortages has resulted in our auditor issuing an opinion on our financial
statements indicating substantial doubt about our ability to continue as a going concern.We have incurred substantial losses of $54,756,975 since our inception. Additionally,
we had negative working capital of $816,943 as of December 31, 2007. Our continued
operations are dependent upon receiving significant financing. On the basis of the
foregoing, our auditors have substantial doubt as of December 31, 2007 and 2006 about our
ability to continue as a going concern.

12

Should we be successful in mining
gold and copper, our revenues may be negatively affected by price volatility of those
metals.Metals prices are subject to extreme price volatility, including gold and
copper, as indicated in (a) and (b) below:

(a)    
          Gold Price.The following table presents the annual high, low and
          average afternoon fixing prices over the past ten years, expressed in U.S.
          dollars, for gold per troy ounce on the London Metals Exchange:

|     |      |     |        
|---- | ---- | --- | -------
|Year | High | Low | Average
|1997 | 367  | 283 | 331    
|1998 | 313  | 273 | 294    
|1999 | 326  | 253 | 279    
|2000 | 313  | 264 | 279    
|2001 | 293  | 256 | 271    
|2002 | 349  | 278 | 310    
|2003 | 416  | 320 | 363    
|2004 | 454  | 375 | 389    
|2005 | 536  | 411 | 445    
|2006 | 725  | 525 | 603    
|2007 | 806  | 631 | 695    

Source of Data: Kitco and
Reuters.

13

On March 31, 2008, the afternoon
fixing price for gold on the London Metals Exchange was $916 per ounce.

(b)    
          Copper.The volatility of the copper market is illustrated by the following
          table, which shows the dollar per pound equivalent of the high, low and average
          prices of high-grade copper on the London Metal Exchange and COMEX in each of
          the last ten years.

|     |      |      |        
|---- | ---- | ---- | -------
|Year | High | Low  | Average
|1997 | 1.23 | .77  | 1.03   
|1998 | .85  | .65  | .75    
|1999 | .84  | .61  | .71    
|2000 | .91  | .73  | .82    
|2001 | .83  | .60  | .72    
|2002 | .77  | .64  | .71    
|2003 | 1.05 | .70  | .81    
|2004 | 1.54 | 1.06 | 1.29   
|2005 | 2.18 | 1.39 | 1.68   
|2006 | 3.99 | 2.06 | 3.06   
|2007 | 3.58 | 2.38 | 2.68   

Source of Data: London
Metal Exchange and COMEX

On March 31, 2008, the closing spot
price of high-grade copper on the London Metal Exchange was equivalent to $3.87 per pound.

Metals prices are subject to factors
that are beyond our control, including speculation, political and economic conditions, and
inflation. Should gold and copper prices experience downward price trends, our revenues
and potential profitability will be negatively affected.

Our continued operations are
dependent upon receiving adequate financing. Our primary operational goals of
developing our Bolivian mining properties in the Precambrian Shield, namely the B and C
Zone gold projects and the Buen Futuro A Zone gold and copper project, will require
substantial debt or equity financing; however, there is no assurance that we will be
successful in receiving adequate financing. Should we fail to receive adequate financing,
any possible revenue generating operations will be significantly delayed or never occur
and we will be subject to increasing losses.

Historically, cash shortages have
negatively affected our ability to explore and develop our properties and diluted our common stock.From
approximately November 1997 to present, we have experienced significant cash shortages. We
have been able to meet our financial obligations only through equity and debt financing.
We may continue to experience cash shortages, which will cause delays in development of
our prospects and any possible revenue generating operations, and will otherwise
negatively affect our financial condition.  Additionally, should we issue additional securities in connection with equity or debt financing, the value of your investment in our securities will be diluted.

We have significant debt
obligations and accounts payable that we may be unable to meet and/or may negatively
affect our operations. At December 31, 2007, we had debt
obligations totaling $1,119,765, consisting of: (a)$193,558 in accounts payable and
accrued expenses; (b) deferred wages of $54,529 (c) other notes payable in the
amount of $214,111; (c) notes payable to  directors and officers for $92,350; (d) a
debenture payable of $249,000; (e) accrued interest payable of $110,187;  (f)
convertible notes payable in the amount of $145,030 convertible into 22,368,719 shares of
our common stock; and (g) contractual obligations totaling $61,000 payable in our common
stock.

# OPERATIONS, DEVELOPMENT
AND MINING RELATED RISKS

Our future success is
dependent upon our existing management.Our future success is dependent upon
the continued participation of our current management who provide us with the key
technical and management aspects of our operations, including: (a) Terry C. Turner, our
Chairman of the Board, President and Chief Executive Officer who has 25 years of exploration and mining experience; (b) Harlan McSpadden (Mac)
Delozier, a Director and our Vice President for Bolivian Administration who has 13 years of exploration and mining experience; (c) Tracy A.
Madsen, our Vice President for US Administration and our Chief Financial Officer who has 21 years of finance and accounting experience; and (d)
Dr. Michael H. Biste, our Chief Consulting Geologist who has 30 years of exploration and mining experience. We have not obtained any key man
life insurance for any of these personnel. Should we lose the services of any of these
personnel, our operations may be negatively affected.

14

Our Bolivia-based operations are
subject to inherent risks, including;

|o | Possible
political instability, civil unrest, or insurrection in Bolivia where all of our mining
properties          and prospects are located, with the exception of our Gold Bar mill
and plant located in Eureka, Nevada;
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Exchange
controls and currency fluctuations;
|- | --------------------------------------------

|o | Material
changes in the regulatory climate in Bolivia pertaining to permitting, licensing, mining,
and the          environment; and
|- | ------------------------------------------------------------------------------------------------------------------------------------

|o | Geographical,
climatic and environmental conditions in Bolivia that may pose operational difficulties,
         including restricting access and development of our prospects; and
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The occurrence of any of these risks
could negatively affect our operations, including delays or stoppages in our mining,
exploration, and development work, negatively affect our financial condition, or
negatively affect the viability of our assets in Bolivia.

# LEGAL, MARKET, AND
REGULATORY RISKS

Our officers and directors direct
and manage our corporate affairs, while our minority shareholders exercise little or no
control over the management of our affairs, which may negatively affect the voting power
of our minority shareholders and prevent a change in control. Our officers and directors direct our
corporate affairs, while our minority shareholders have little or no control over our
corporate affairs. For instance, our Board of Directors has the right to authorize the
issuance of blank check preferred stock with such designations, rights and
preferences, as they may determine. As such, our Board of Directors may issue, and has in
fact issued, shares of preferred stock with such rights and preferences without
shareholder approval, which could adversely affect the voting power or other rights of our
common shareholders. Additionally, such preferred stock issuances could have the effect
of discouraging, delaying or preventing a change in our control.

We have indemnified our officers
and directors to the full extent permitted by Colorado law, which could negatively affect
our financial condition.Our Articles of Incorporation and Bylaws provide for
indemnification of our officers and directors to the full extent permitted by Colorado
law. This indemnification may require us to pay judgments, fines and expenses incurred by
an officer or director, as a result of actions or proceedings against them. Funds or our
securities paid in satisfaction of judgments, fines or expenses would likely be funds that
we would need for our operations and for the exploration and development of our
properties, and may negatively affect our operations, financial condition, and/or further
dilute the value of our securities.

Our issuances of shares in the
past have caused substantial dilution to the value of our common stock and will continue
to do so in the future.During our past three fiscal years, our operations and
acquisitions have been dependent upon our raising capital by: (a) selling substantial
amounts of our common stock shares; (b) issuing shares in connection with convertible
debentures; and (c) at the end of 2006, and during 2007, issuing shares of Series B
convertible preferred stock, which are convertible into our common stock. The issuances of
the securities in (a)  (c) are dilutive to the value of our securities, especially
since many of these securities were issued below the then-current market prices.

15

On September 14, 2007, we held a
Shareholders Meeting at which the shareholders voted to increase the number of
authorized common shares to 2,000,000,000 shares. The increased number of shares allowed
sufficient shares to convert the Series B shares we had previously issued into common
shares. As of March 11, 2008, 96% of the outstanding Series B shares had been converted
into common shares, leaving 4,374,998 Series B shares available for issue. Since our
operations are currently dependent upon raising additional funds through debt or equity
financing, future issuances will further dilute the value of our securities. While we
currently have no plans to issue additional Series B shares, we may it necessary to do so,
which will further dilute the shareholdings of our existing shareholders.

The public market for our common
stock is extremely volatile, both as to price and volume, and may continue to be volatile
in the future.During 2007, the price and trading volume of our common stock has been
volatile. Significant operating losses, the shutdown of our operations at our Cangalli
claim in June of 2004, our failure to recommence gold production, political instability in
Bolivia, and other factors may have contributed to this volatility, and such factors may
continue to impact price and trading volume volatility.

We face substantial
governmental regulation. Our business in Bolivia is subject to
extensive regulation pertaining to the development of our prospects and possible
production, environmental regulation, labor standards, mine safety and others. Should we
fail to abide by these regulations, are operations may be subject to fines or restrictions
on activities pertaining to our prospects and properties in Bolivia, which may negatively
affect our ability to conduct our operations.

We have not developed
independent corporate governance. We do not have independent directors.
Additionally, we have no audit, compensation, or nominating committees. This lack of
independence and independent controls over our corporate affairs may result in potential
or actual conflicts of interest between our officers, directors and our shareholders.
We have no policy to resolve such conflicts and these conflicts of interests may benefit
the interests of our officers and directors over that of our minority stockholders.

# Item 2. Our Properties

16

As described in Item 1, Business, we
own mining concessions in Bolivia and an idle mill and mineral processing plant 25 miles
northwest of Eureka, Nevada. These properties include:

|o | The
Precambrian properties (discussed in paragraphs (a), (b) and (c), below).
|- | -----------------------------------------------------------------------------

|o | The
Tipuani-Cangalli properties (discussed in paragraphs (d), (e) and (f), below), and
|- | --------------------------------------------------------------------------------------

|o | The
Gold Bar mill and plant (discussed in paragraph (g) below).
|- | ---------------------------------------------------------------

# (a) The Precambrian
properties.

In June of 2001, we acquired four
mining claims in Bolivias Precambrian Shield with a total acreage of approximately
125,000 acres, as well as the existing reports on the area, for 10 million shares of our
common restricted stock then valued at $300,000 ($0.03 per share). These shares were
issued to persons who were not United States citizens or residents for investment purposes
in accordance with exemptions from registration found in Section 4(2) and 4(6) of the
Securities Act of 1933, and the safe harbor under Regulation S.

We pay $99,836 per year to the
Bolivian government in mining patent fees (mining claims fees) for our Precambrian
properties. The Bolivian Mining Code provides that these annual government claims fees are
the only obligation that we have in order to maintain our rights over these properties in
perpetuity.

Our geologists explored these
prospects and found them to be highly prospective for extensive near surface gold
mineralization and deeper mineralized volcanogenic massive sulphides (VMS)
systems containing gold and copper.

# (b) Buen Futuro claim

In June 2003, we purchased the Buen
Futuro claim, and all technical information that had been generated about the property,
from Celia Calla de Arraya, a Bolivian, and her son-in-law, Dr. Michael H. Biste, a
geologist who has worked extensively in the area. We then amended the purchase contract in
December 2003 and March 2005. The terms of the acquisition included a 3% net smelter
return, payments of $250,000 cash and 1,065,960 shares of our restricted common stock with
a total value of $175,000. We have complied either partially or fully with additional
obligations or terms under this agreement, including:

|o | Payment
of $3,000 per month in cash and $2,000 per month in stock to Dr. Biste as a consulting
fee for          exploration and development of Buen Futuro.  This monthly fee is payable
for 60 months from the date of the          original agreement.  This consulting
agreement expires on May 31, 2008. As of December 31, 2007, we owed Dr.          Biste
$12,000 in cash and $36,000 in stock value under this agreement.  As of the date of this
report we          have paid Dr. Biste the stock owed to him.
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Maintaining
an exploration program to replace mineral reserves as they are depleted through mining as
long          as the potential for feasible mineral reserves continues on the ore
deposits found within the Buen Futuro          concession.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Investing
$1 million in exploration by November 23, 2006. We have expended approximately $699,000
to date          that we believe may be applied to this commitment.  We will only be able
to meet the remainder of this          commitment if we receive a significant amount of
additional financing.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Our
original agreement required us to enter into mineral production on the Buen Futuro
concession by May 23,          2005, and to expend a minimum of $2,000,000 to initiate
that production. We believe that the acquisition of          the Gold Bar mill and plant
for $3,980,000 satisfies this investment requirement. On May 20, 2005, we
         entered into an amended agreement with the sellers whereby we agreed that if we
were not in production at          Buen Futuro by November 23, 2005 we were required to
pay a penalty of $1,500 per month to the sellers until          we enter production or
until November 23, 2006. If by November 26, 2006 we were still not in production, the
         penalty amount payable to the seller increased to $3,000 per month. As of
December 31, 2007, we owed $12,000          in production penalties which were past due.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

17

We intend to make these past due
payments during the second quarter of 2008, and we continue to maintain a positive
relationship with the sellers; however, there is no assurance that claims may not be
brought against us in connection with this agreement or that we will have sufficient
financial resources to comply with these and other obligations under this agreement.

There are no other stated penalties
for failure to comply with these commitments. We estimate that the initial build-out of
the gold plant on the Buen Futuro A Zone, and other infrastructure improvements, will
require a capital investment of approximately $10,000,000 if we conclude that the best
course of action would be to dismantle our Gold Bar mill and move it to the A Zone project
site. However, if we elect to proceed with the acquisition of component parts of the
processing mill in South America or elsewhere, our potential investment requirement could
be two or three times larger. Currently, we are studying the issue with our consulting
engineering firm.

The Buen Futuro mining claim is
located squarely in the center of our 125,000-acre landholding in a geological area within
eastern Bolivia known as the Precambrian Shield. This area, which resulted
during a geological time known as the Precambrian Era,is located 300 kilometers
(180 miles) north of Santa Cruz, Bolivia, and 18 kilometers (11 miles) east of the town of
Ascension de Guarayos. The Buen Futuro claim consists of 2,500 acres and contains three
well-identified gold/copper ore bodies in the A Zone. We exercised our rights to purchase
the Buen Futuro property in June 2003. A private contract and recorded public contract
were signed and filed with the Superintendency of Mines of the Department of Santa Cruz on
December 12, 2003.

The Buen Futuro mineral deposits are
found in a gold oxide layer commencing at the surface and ranging to depths of 130 to 200
feet. Immediately beneath this surface oxide layer is a supergene, or copper-enriched
layer, extending from the bottom of the gold oxide zone to a depth of 320 feet, sitting on
top of a mineralization system that is known as a strata-bound volcanogenic massive
sulfide (VMS). Based on data gathered through a combined 44,000 feet of auger,
reverse circulation and diamond core drilling, as well as 8 miles of trenching, we
estimate 4.36 million tonnes of mineralized material in the gold oxide layer with a gold
grade of 1.23 g/t for a total of 172,000 troy ounces; and 6.5 million tonnes in the
copper-enriched supergene layer with a copper grade of 1.85% for a total of 120,000 fine
tonnes (265 million pounds) of copper. Particular note should be made that mineralized
material is not the equivalent of proven and probable reserves, and that the area tested
is less than one-half of one percent of our landholding in eastern Bolivia.

18

Based on Dr. Michael Bistes
study, as detailed below, we believe that the Buen Futuro A Zone gold/copper deposits,
surrounded by our Precambrian claims, are just part of a much larger trend of VMS clusters
that run both northeast and southwest within our total landholding of 136,500 acres. A
study was carried out on the larger trend by Dr. Biste, our Chief Consulting Geologist,
who is an expert on the Precambrian geology of eastern Bolivia. The exploration data
resulted from the northern part of our Dos Piyos claim, and the southwest portion of the
Cobra claim. Both properties cover the northern part of the Ascension Gold-Copper Trend
and the investigated ground comprised 23 square miles. Dr. Biste prepared a remote sensing
study consisting of an interpretation of satellite images, aerial photographs, and open
file airborne magnetic and radiometric data. He further reexamined historic reconnaissance
exploration data of the two claims and applied modern computer based methods for an
integrated data interpretation. In addition, Dr. Biste used the results of geological
mapping over 44 linear miles, magnetic ground surveys of over 9 miles and soil sampling
over a distance of 18 miles, as well as Horizontal Loop Electromagnetic (HLEM) data along
two extensive test lines. Despite the wide line spacing of 0.6 miles, Dr. Biste was able
to identify a geological setting with characteristics very similar to the host rock of the
Buen Futuro VMS mineralization. Buen Futuro is located 12 miles southwest of the
investigated area. The HLEM survey so far has confirmed three parallel striking
conductors, which Dr. Biste believes represent a primary VMS mineralization that is
covered by an oxide layer at least 30 meters deep. The lateritic soil at the surface
carries geochemically anomalous values for gold, copper and zinc. Our summary study covers
3.6 miles of the Trend and the remote sensing data shows that the favorable VMS lithology
strikes further to the northeast. We consider these findings to be a significant step
toward identifying new gold-copper mineralization similar to the Buen Futuro ore bodies.
Dr. Biste believes that fieldwork will continue to demonstrate that the Ascension
Gold-Copper Trend is now likely to extend over at least 21 linear miles within our
Precambrian properties. While we will use Dr. Bistes findings to guide our further
exploration of the Ascension Gold-Copper Trend, there are no assurances that our
additional studies will prove that commercially economical mineral deposits exist in the
Ascension Gold-Copper Trend.

We believe that our current
landholding in the Ascension Gold-Copper Trend provides us with several important
opportunities for future development; however, such opportunities are contingent upon our
ability to raise the needed development capital either through operations, equity funding,
debt financing or by entering into joint venture relationships.

We own the underlying mineral rights
on the Buen Futuro project through the purchase of mineral concession rights that had been
granted by the Bolivian government. Continuation of this concession requires an annual
patent fee of $2,417. However, we had to purchase the surface land rights before we could
actually begin to disturb the surface with mining and development activities. We have
purchased 585 acres of surface rights covering the areas that we intend to mine in the
Buen Futuro A Zone, as well as all areas necessary for the location of our mill, recovery
plant, fresh water ponds, tailings impoundments and mine camp site. As other surface
rights become necessary, we expect to acquire those rights under reasonable terms also.

# (c) Cobra claim

19

On December 22, 2003, we completed
the acquisition of the Cobra claim, an additional 22,500 acres of prime ground in the
Ascension Gold-Copper Trend in eastern Bolivias Precambrian Shield. The Cobra claim
has proven positive for VMS deposits containing gold and copper, as well as near-surface
gold oxide deposits. Induced polarization (IP) and Horizontal Loop Electromagnetic (HLEM)
surveys, both of which are scientific tools that measure magnetic fields are and used by
geologists to identify possible mineralization within the earth, as well as scout auger
drilling, which is essentially a threaded drill that brings samples from a relatively
shallow depth to the surface for sampling, have yielded results suggesting that gold,
copper, and other potentially valuable minerals may be present in an area extending to the
northeast of our previous 111,500-acre landholding. Our total landholding in the
Precambrian Shield after this acquisition, including the 2,500 acre Buen Futuro claim is
136,500 acres.

We secured the Cobra claim through a
Bolivian mining petition and paid initial claims fees of $10,000. To maintain the property
in perpetuity, we must pay annual concession patent fees to the Bolivian government of
$10,867.

Total patent fees on all of our
Precambrian Shield Claims, which includes the Buen Futuro and Cobra claims for 2008, are
$113,120 and were paid on February 28, 2008. No additional patent fees are payable until
February 2009, which we estimate to be $113,000.

# (d)(1) The Cangalli and
Tipuani Valley claims

In October 1995, we began reviewing
potential mining opportunities in Bolivia. On July 2, 2002, we purchased 100% of all
right, title and interest in and to the mining concessions comprising the Cangalli claims.
In total, we purchased 5,125 acres and claimed an additional 7,402 acres in the Tipuani
Valley resulting in total claims of 12,527 acres. We pay $5,011 per year to the Bolivian
government in mining patent concession fees. The Bolivian Mining Code provides that these
annual government claims fees are our only obligation necessary to our rights over the
Cangalli claims in perpetuity. The patent fee for 2008 was paid on February 28, 2008 and
no additional fees are payable until February 2009.

# (d)(2) Production from
our Cangalli mine

On September 30, 2002, we commenced
operations at our Cangalli gold mine at the rate of 1,000 tonnes per day from our open pit
operation. By November 2002, we had increased our production capacity to 2,000 tonnes per
day. By the end of the fourth quarter, December 31, 2002, we had processed 92,700 tonnes
of ore, and had recovered 43,847 grams, or 1,410 troy ounces, of gold.

On February 10, 2003, we announced
the conversion from our open pit operations to more cost-effective underground block
caving from our interior mine while maintaining a production capacity of 2,000 tonnes per
day.

In July 2003, we completed
construction of our 3,500 tonne per day plant and began processing material at an
increased rate. We had projected that once we had reached 3,500 tonnes per day on a
sustained basis, our Cangalli gold operation would reach and surpass the breakeven point,
and would enter into a sustained positive cash flow.

20

On June 25, 2004, we temporarily
ceased mining operations at our Cangalli mine and plant as a result of road blockades by
local citizens protesting various government policies in Caranavi, Bolivia, a town half
way between La Paz and our Cangalli mine. The roadblocks prevented the delivery of needed
supplies and materials to the mine for operations. The same blockade, approximately 80
miles from Cangalli, also hampered operations of the power sub-station in Guanay, Bolivia.
This sub-station provides electricity to our Cangalli operation, and the power failures
halted all mining and processing activities.

During
June 2004, before the strike issues were settled, we ceased gold mining operations at our
Cangalli property, also as a result of issues that arose among the United Gold Mining
Cooperative that had sold us a 5,125-acre mining concession, and FENCOMIN, the Bolivian
governmental regulator of cooperatives, as well as other Bolivian regulators. The legal
issues involving the United Gold Mining Cooperative had nothing whatsoever to do with us,
but created an insecure atmosphere at our Cangalli gold mine and raised serious questions
about whether formal intervention would occur and substantially hamper operations.

We cannot assure that operations will
ever recommence at on our Cangalli or Tipuani Valley properties.

(e)    
          Gold Bar mill and plant

On June 18, 2004, we entered into a
purchase agreement with Atlas Precious Metals, Inc. (Atlas) for the purchase
of the Gold Bar mill and gold recovery plant located 25 miles northwest of Eureka, Nevada.
In exchange for the Gold Bar mill and plant, we issued 30,000,000 shares of our restricted
common stock to Atlas Precious Metals for this mill and plant. The shares were valued at
$.12 per share based on the closing price of the stock on the closing date or an aggregate
shares value of $3,600,000. Upon raising the necessary capital, we have always intended to
dismantle, ship and re-erect this plant on our Buen Futuro A Zone site in eastern Bolivia.
We are further evaluating our plans with respect to our Gold Bar mill. We estimate the
time to dismantle the plant, transport it to Bolivia and re-erect it on our Buen Futuro
claim will be approximately eight months to one year from the time we raise the necessary
financing. We estimate an approximate $3.5 million cost to dismantle, ship and re-erect
the plant on our Buen Futuro claim. However, we are also reviewing the possibility of
rehabilitating the Gold Bar mill on its current site and using it for toll processing of
gold ore from neighboring ore bodies. Presently, within a 50-mile radius of the Gold Bar
mill there are a number of identified and proven oxide gold deposits that could be
subjected to milling and gold recovery through the Gold Bar mill and plant. The status of
the Gold Bar mill will be indeterminate until we have had an opportunity to evaluate more
information about the possibilities that are currently being presented.

21

Prior to completing the purchase of
the Gold Bar mill, we received a fairness opinion prepared by H.E. Dunham &
Associates. The opinion from H.E. Dunham & Associates determined the economic fairness
of the Gold Bar mill transaction to our shareholders. The report estimated a replacement
value on the Gold Bar mill and plant at $12 million. This report also provided an
estimated cost to build a similar-sized new gold and copper recovery plant with its
associated new equipment, engineering and construction costs at between $45 million and
$50 million. The report also included three comparable acquisition transactions of similar
size and capacity, which were used as comparison to our acquisition of the Gold Bar mill
and plant. These included the Carr Fork facility located at Tooele, Utah, which sold for
$7.0 million and the Quintana facility, located at Truth or Consequences, New Mexico,
which sold for $8.5 million to OK Tedi Mining Company in 1986 dollars; the 4,000 tonnes
per day Paradise Peak Gold Facility located at Gabbs, Nevada is currently on the market
for $18 million. The report stated that the acquisition of the Gold Bar Mill is most
beneficial to us at a good price. Finally, H.E. Dunham & Associates
expressed the opinion that the transaction is economically fair to Golden Eagle
International, Inc., Atlas and their shareholders. Atlas offered to sell the Gold
Bar plant to us, at what we believed was a discounted price, as a result of its desire to
participate in the mining of gold and copper at Buen Futuro. The Gold Bar plant was suited
to our needs and was not at the time processing ore from the Gold Bar mine.

In accordance with the original Asset
Purchase Agreement between Atlas and us, we agreed to move all Gold Bar assets off the
property located near Eureka, Nevada within twelve months from the date of the agreement;
however, it was apparent that we would be unable to remove the assets by this date, and
Atlas had the right to either allow us to store the assets on site or terminate the
agreement and return the purchase price to us. While we believed that Atlas did not intend
to terminate the agreement, such termination would force return of the assets, and we
could not guarantee that Atlas would not exercise its termination rights. Consequently, on
May 19, 2005 we completed an amended asset purchase agreement with Atlas, which no longer
required us to remove the Gold Bar Mill and plant from the site within a specified time
period, but required us to issue an additional purchase price of 20,000,000 shares of our
restricted common stock at $.019 per share or a total of $380,000, which we so issued.

We are presently evaluating the
status of the Gold Bar mill. In addition to our plans to relocate the Gold Bar mill and
plant to our Buen Futuro project, we are also investigating the possibility of restarting
the Gold Bar mill on its current site outside of Eureka, Nevada or the possibility of
selling the plant to raise money for future investment at Buen Futuro. While we have not
made a decision concerning Gold Bar, there is no guarantee that we will be able to obtain
the financing to commence a tolling project at its current location, which we estimate to
be between $500,000 and $1,000,000 to rehabilitate the mill; a substantial, but yet
undetermined amount to create a suitable tailings impoundment; the necessary permitting
from state and federal agencies; and whether we would be able to obtain the necessary
customers to ensure a successful operation. We also cannot guarantee that if we choose to
sell the plant that we will be able to find a buyer or recover our costs in the project.
While Atlas continues to own the property on which the plant stands and has allowed us
sufficient time to remove our equipment, we can also offer no guarantee that they will not
sell the property to a buyer that will request that we sell the mill or remove it from its
current location.

22

# (f) Office leases

Our executive offices are located at
9661 South 700 East, Salt Lake City, Utah 84070. This suite of offices consists of three
executive offices, a conference room, reception space, filing areas and copy and faxing
facilities that are suitable for our needs. We pay $1,507 per month on a three-year lease
with a two-year option.  The original lease term expires in July 2008. We are
allowed to terminate the lease at the end of year two for a $1,507 penalty plus a
30-day notice, which at this stage of the lease is our only obligation.

We also lease 150 square meters of
office space located at Jaimes Freire, 4 Norte, Calle Las Jardineras, #16, Santa Cruz de
la Sierra, Bolivia, which is our Bolivian headquarters. This lease expires December
31, 2008. We pay a $500 per month lease payment.

|                               |                   |              |                  
|------------------------------ | ----------------- | ------------ | -----------------
|Location                       | Size              | Monthly Rent | Lease Expiration 
|                               |                   |              |                  
|Salt Lake City                 | 1,183 square feet | $1,507       | July 31, 2008    
|Santa Cruz, Bolivia            | 150 square meters | 500          | December 31, 2008
|Warehouse, Santa Cruz, Bolivia | 360 square meters | 162          | August 14, 2008  
|                               |                   |              |                  
|Total                          |                   | $2,169       |                  

Our operating subsidiary, Golden
Eagle International Inc. Bolivia, owns the mining and processing equipment, which is
located on the Cangalli claim under its control, or at its warehouse in Santa Cruz,
Bolivia.

# Item 3. Legal proceedings

1.    
          Turner v. Golden Eagle, Pfeffer, Dunham and Jacobs. On September 1, 2006,
          our Chief Executive Officer, Terry C. Turner (the Plaintiff) filed
          an action against us, Kevin K. Pfeffer, H.E. Dunham, and William A. Jacobs
          (the Defendants) in the United States District Court for the
          District of Utah titled Terry C. Turner v. Golden Eagle International, Inc.,
          Kevin K. Pfeffer, H.E. Dunham and William A. Jacobs, Civil Action
          No.2:06-cv-00738-TC (D. Utah: 2006).  The Complaint sought a temporary
          restraining order enjoining Defendants, until such time as a preliminary
          injunction hearing may be held, from the following:  (a) publishing a
          proposed Form 8-K pertaining to the August 24, 2006 meeting of the Board of
          Directors; (b) preventing Defendants from violating Regulation FD and the
          disclosure of insider information; (c) preventing Defendants from further
          breaches of their fiduciary duty to Golden Eagle; (d) preventing Defendants from
          breaching Golden Eagles Code of Ethics; (e) holding a Board of
          Directorsmeeting on September 4, 2006, or any date
          thereafter;  and (f) publishing disparaging, slanderous, libelous or
          defamatory comments regarding Plaintiff.

By the end of 2006, all defendants
except Kevin K. Pfeffer had been voluntarily dismissed from the lawsuit. The case was
subsequently dismissed without prejudice on March 30, 2007.

23

2.    
          Golden Eagle & Turner v. Pfeffer. On September 5, 2007 we and our
          Chief Executive Officer, Terry C. Turner, filed an action against our former
          director, Kevin K. Pfeffer, in the United States District Court for the Central
          District of Utah titled, Golden Eagle International, Inc. and Terry C. Turner
          v. Kevin K. Pfeffer, 2:07-CV-662-TC (D.Utah; 2007). The allegations were
          essentially the same, or very similar, to those made in Turner v. Golden
          Eagle, Pfeffer, et al, referenced above. Plaintiffs sought an unspecified
          amount of damages to be determined at trial. On January 25, 2008, we settled the
          above matter by entering into two agreements with Kevin K. Pfeffer (Mr.
          Pfeffer), which became effective February 1, 2008 based on certain
          conditions subsequent being met. Mr. Pfeffer was a former director in Golden
          Eagle International, Inc., having served on our board of directors from January
          23, 2003 through December 4, 2006. The two subject agreements settled any and
          all outstanding debts that we had with Mr. Pfeffer, as well as any and all
          outstanding allegations, claims, disputes and controversies.

The first agreement was titled,
Settlement and Release Agreement. Terry C. Turner (Mr. Turner),
our President, Chief Executive Officer and Chairman of the Board, was also a party to
this agreement. In this agreement Mr. Turner, Mr. Pfeffer and we agreed to the following:

(a)     That Mr.
Turner and we would dismiss with prejudice our case alleging certain causes of action
against Mr. Pfeffer filed in the Federal District Court for Utah, Central Division, on
September 5, 2007 titled, Golden Eagle International, Inc. and Terry C. Turner v.
Kevin K. Pfeffer, 2:07-CV-662-TC (D.Utah; 2007). This voluntary dismissal was filed
on January 28, 2008 and was acknowledged by the Court on January 29, 2008;

(b)     Mr.Turner
and we also agreed to release and hold Mr. Pfeffer harmless regarding any and all
allegations, claims, disputes and controversies between the parties, and entered into a
covenant not to sue Mr. Pfeffer or otherwise take any action to harm him or his
reputation.

(c)    
          Mr. Pfeffer agreed to release and hold Mr. Turner and us harmless regarding any
          and all allegations, claims, disputes and controversies between the parties, and
          entered into a covenant not to sue Mr. Turner or us or otherwise take any action
          to harm Mr. Turner or us or our reputation.

(d)  We acknowledged certain
sums that we owed to Mr. Pfeffer, including a promissory note dated June 6, 2005 for an
operating loan that Mr. Pfeffer had made to us, accumulated interest and penalties on that
note, and expenses that Mr. Pfeffer had incurred while serving on our board of directors,
which totaled $230,434.37, which we agreed to convert into 57,608,593 shares of our common
stock and we so issued to Mr. Pfeffer on February 26, 2008

(e)     All
parties agreed to a two-year Quiet Period in which all parties will cease to
comment, publicly or privately, in Internet forums and blogs, or any other written or
verbal venue, regarding any of the other parties.

The second agreement was titled,
Stock Purchase Agreement. In this agreement we agreed with Mr. Pfeffer to the
following:

(a)    
          All of the terms and conditions of the Settlement and Release Agreement set out
          above, as well as the agreement for the actual issuance to Mr. Pfeffer of
          57,608,593 shares of our common stock in exchange for $230,434.37 in debt that
          we owed to Mr. Pfeffer pursuant to exemptions from registration for accredited
          investors found in Sections 4(2) and 4(6) of the Securities Act of 1933.

24

3.    
          Golden Eagle International, Inc. v. John and Jane Does 1-10, et al: On
          July 26, 2007, we filed an action in the Federal District Court for the Central
          District of Utah entitled: Golden Eagle International, Inc. v. John and Jane
          Does 1-10, aka pseudonyms: Ann Warren, ann_483,
          msbunny2211, asyouwishalways,
          markgeorgethe3rd, lehrerpj, slaphappy25,
          bluebird77-7 and others, Civil Action No.2:07-CV-00540-TC (D. Utah; 2007). Our suit alleged that Defendants John and
          Jane Doe 1-10, aka the listed pseudonyms, as well as others to be discovered,
          were anonymous posters on Yahoo! and Raging Bulls Internet message boards
          regarding us (which boards and posters often refer to us by using its trading
          symbol on the OTC Bulletin Board, MYNG), who maliciously authored
          and posted outrageous, manipulative, deceptive, denigrating, disparaging,
          untrue, indecent, obscene, profane, defamatory and libelous comments regarding
          us, and our officers, for unlawful and tortious purposes. We subpoenaed the IP
          addresses of these anonymous posters from Yahoo and Raging Bull, received that
          detailed information and determined the identity of several of these posters to
          our satisfaction. After an analysis of the individuals involved we determined
          that it was a waste of our time and resources to pursue judgment-proof
          defendants and allowed the matter to be dismissed without prejudice on March 4,
          2008.

We are not aware of any other legal
action pending or threatened against us.

# Item 4. Submission of
matters to a vote of security holders

On September 14, 2007, at a special
meeting of shareholders held in Salt Lake City, Utah, our shareholders approved an
amendment to our Articles of Incorporation to increase the our authorized common stock
from 800,000,000 shares to 2,000,000,000 shares. On September 18, 2007 we filed Articles
of Amendment to our Articles of Incorporation increasing our authorized common stock with
the Colorado Secretary of State, which amendment became effective immediately. The
amendment does not affect the number of authorized shares of preferred stock, as disclosed
in our proxy statement for that meeting.

At the September 14, 2007 special
meeting of shareholders, two proposals were submitted to the shareholders for approval as
set forth in our definitive proxy statement dated August 10, 2007:

|   |                                                                                                                                                                                                                
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1. | An amendment to our Articles of Incorporation to
increase the number of shares of common stock we are authorized to issue from eight hundred million (800,000,000)
shares to two billion (2,000,000,000) shares
|2. | To ratify the appointment of Chisholm,
Bierwolf & Nilson as our Independent Registered Public Accounting Firm for the fiscal year ending December 31, 2006.                                                    

There was no solicitation contrary
to Golden Eagle International's proxy statement.

25

As of the record date, August 2,
2007, there were 789,999,990 shares of our common stock issued and outstanding and
3,425,963 shares of our Series B Contingent Convertible Preferred Stock issued and
outstanding. The holders of record of 437,162,924 shares of Common Stock were present in
person or represented by proxy at the meeting. Additionally, the holders of record of
shares of Series B Contingent Convertible Preferred Stock entitled to 3,314,918 shares
were present in person or represented by proxy at the meeting, which constituted a
quorum. (Each share of the Series B Contingent Convertible Preferred Stock is entitled to
250 votes, and were further entitled to vote with the common stock on all matters
presented for shareholder approval.) The votes present at the meeting represented
approximately 77% of the votes attributable to shares of voting stock outstanding and
entitled to vote at the meeting.

At the meeting, the shareholders
approved both proposals, with the votes being cast as follows:

|                                                                                 |               |            |           
|-------------------------------------------------------------------------------- | ------------- | ---------- | ----------
|                                                                                 | For           | Against    | Abstain   
|Amendment to Increase Authorized Capital                                         | 1,185,524,537 | 58,001,942 | 22,366,165
|                                                                                 |               |            |           
|Ratification of Chisholm, Bierwolf & Nilson for the year ended December 31, 2006 | 1,231,609,483 | 9,032,430  | 25,250,731

# PART II

# Item 5. Market for
Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities

# Market Information

Our common stock is quoted on the
Over-the-Counter (OTC) Bulletin Board under the trading symbol
MYNG.

The following table shows the high
and low bid for our common stock during the last two years and the current fiscal year.
These prices represent inter-dealer prices, without retail mark-up, markdown, or
commission, and may not represent actual transactions, and were derived from Knobias at
www.knobias.com:

|               |              |         
|-------------- | ------------ | --------
|2006           | Low Bid      | High Bid
|               |              |         
|First Quarter  | $       .024 | $.037   
|Second Quarter | $       .017 | $.030   
|Third Quarter  | $       .010 | $.017   
|Fourth Quarter | $       .008 | $.014   

|               |                |        
|-------------- | -------------- | -------
|2007           | Low Bid        | HighBid
|               |                |        
|First Quarter  | $         .006 | $.030  
|Second Quarter | $         .018 | $.030  
|Third Quarter  | $         .011 | $.020  
|Fourth Quarter | $         .008 | $.016  

26

|                       |         |         
|---------------------- | ------- | --------
|2008 (through April 1) | Low Bid | High Bid
|                       |         |         
|                       | $.008   | $.016   

# Holders

As of December 31, 2007, there were
approximately 1,195 shareholders of record of our common stock based on information we
received from our transfer agent. This number does not include an undeterminable number of
beneficial holders who own their shares through broker-dealers.  Based on a search we conducted for our September 14, 2007 shareholder's meeting,
we
estimate that we have an additional 3,800 shareholders.

# Outstanding shares

We are authorized to issue
2,000,000,000 common shares; as of December 31, 2007, we had 1,602,510,490 shares
outstanding. In addition, we are authorized to issue 10,000,000 preferred shares, We have
designated 3.5 million as Series A shares, none of which have been issued. An additional
4,500,000 of our preferred shares were designated as Series B preferred shares of which
345,962 were outstanding as of December 31, 2007. As of the date of this report we have
1,760,608,267 common shares outstanding.

# Dividends

We have never paid a cash dividend on
our common stock or on our preferred stock and have no present intention to declare or pay
cash dividends on our common or preferred stock in the foreseeable future. We intend to
retain any earnings that we may realize in the foreseeable future to finance our expanding
operations. Future dividends, if any, will depend on earnings, financing requirements and
other factors.

# Securities authorized
for issuance under equity compensation plans

During 2007, we adopted the 2007
Employees and Consultants Stock Compensation Plan as reflected in the following table as
of December 31, 2007. Our directors, officers and affiliates cannot participate in this
plan. As discussed below, we have compensated our officers and directors with stock
options and stock bonuses, but those are ad hocdeterminations made by our board of
directors and are not pursuant to any plan. These ad hoc grants have not been
submitted to the shareholders for approval.

27

# Equity Compensation Plan
Information

|                                                           |                                                                                                 |                                                                                |                                                                                                                                               
|---------------------------------------------------------- | ----------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------
|                                                           |                                                                                                 |                                                                                |                                                                                                                                               
|Equity Compensation Plan Information                      
|                                                           |                                                                                                 |                                                                                |                                                                                                                                               
|Plan Category and Description                              | Number of Securities to be issued upon exercise of outstanding options, warrants, and rights(a) | Weighted average exercise price of outstanding options, warrants and rights(b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))(c)
|                                                          
|Equity compensation plans approved by security holders     | -0-                                                                                             | -0-                                                                            | -0-                                                                                                                                           
|                                                           |                                                                                                 |                                                                                |                                                                                                                                               
|Equity compensation plans not approved by security holders | -20,000,000-                                                                                    | -0-                                                                            | -0-                                                                                                                                           
|                                                           |                                                                                                 |                                                                                |                                                                                                                                               
|Total                                                      | -20,000,000-                                                                                    | -0-                                                                            | -0-                                                                                                                                           
|                                                           |                                                                                                 |                                                                                |                                                                                                                                               

# Unregistered sales of
equity securities and use of proceeds

On December 20, 2007, we issued
3,000,000 restricted shares of our common stock to Sabrina Martinez for a severance
payment valued at $.008 per share or an aggregate of $24,000.

Between October 1, 2007 and December
31, 2007, our Series B Convertible Preferred shareholders had converted 3,210,042 Series B
Preferred shares into 857,750,500 restricted common shares. We relied upon Sections 4(2)
and 4(6) of the Securities Act for the offer and sale. We believed that Sections 4(2) and
4(6) were available because the offer and sale did not involve a public offering, there
was no general solicitation or general advertising involved in the offer or sale and the
purchaser was an accredited investor. All of these transactions were described
individually in greater detail in previous filings.

All other issuances during 2007 have
been previously reported on our Forms 10-Q and 8-K.

# Preferred Stock

We issued 1,988,599 shares of Series B
Preferred Stock on December 29, 2006 in exchange for debt.

During the first quarter of 2007, we
issued 461,301 shares of Series B Preferred Stock for cash from investors and 12,103
shares of Series B Preferred Stock to 9 employees for services. During the second quarter
of 2007 we issued 963,960 shares of Series B Preferred Stock for cash and for the
conversion of debt. During the third quarter of 2007 we issued 130,041 shares of our
Series B Preferred Stock for cash and the conversion of existing debt and accrued
interest. A total of 3,556,004 shares of Series B have been issued as of December 31,
2007.

28

The Series B Preferred Stock referred
to above has conversion rights that allow the holders to convert each Series B preferred
share into 250 restricted shares of our common stock. On September 14, 2007 at a special
meeting of our shareholders, our shareholders approved the increase of our authorized
common shares to 2,000,000,000 shares. On September 18, 2007 we amended our articles of
incorporation to reflect the increase in authorized common shares to 2,000,000,000 shares.
At the time the articles of incorporation were amended we had sufficient common shares
available by which to convert all of our outstanding Series B Preferred Shares to common
shares. As of April 14, 2008, 96% or 3,431,002 of the outstanding Series B shares had been
converted into 857,750,500 common shares, leaving 125,002 left to convert into 31,250,500
common shares.

We currently have 4,374,998 Series B
shares available for issue.

Issuances of common stock after
our year-end of December 31, 2007 (not previously reported on Form 8K).

On February 4, 2008, we issued
5,997,564 shares of our common stock to Harlan (Mac) DeLozier at $0.009 per share or an
aggregate value of $53,978.08. The shares were issued for a February 6, 2007 convertible
note payable to Mr. DeLozier for services provided to us.

On February 5, 2008, we sold
6,500,000 shares of our common stock to Dewey L. Williams, The Dewey L. Williams Profit
Sharing Plan and Trust and the Dewey Williams Roth IRA at $0.005 per share or an aggregate
of $32,500. We relied upon Sections 4(2) and 4(6) of the Securities Act.

On February 14, 2008, two of our
Series B Convertible Preferred shareholders had converted an additional 25,000 Series B
Preferred shares into 6,250,000 restricted common shares.

On February 15, 2008, we issued
3,750,000 shares of our common stock to Burns, Figa & Will at $0.004 per share or an
aggregate of $15,000. The shares were issued for a January 16, 2007 convertible note
payable to Burns, Figa & Will for legal services provided to us which were past due.

On February 26, 2008, we sold
3,000,000 shares of our common stock to Stuart Rubin at $0.005 per share or an aggregate
of $15,000.

On March 14, 2008, we issued
2,750,361 shares of our common stock to Dr. Michael Biste at an average price of $0.013
per share or an aggregate of $36,000 for geological consulting services provided under a
consulting agreement.

On March 24, 2008, we sold 11,156,250
shares of our common stock to Dewey L. Williams and The Dewey L. Williams Profit Sharing
Plan and Trust at $0.004 per share or an aggregate of $44,625.

29

On March 31, 2008, we issued
12,101,560 shares of our common stock to Marco Venegas, an employee residing in Bolivia,
for accrued wages and for a loan repayment, at $0.004 per share or an aggregate of
$47,196.

On March 31, 2008, we issued
1,380,371 shares of our common stock to Marigen Rocha, an employee residing in Bolivia,
for accrued wages, at $0.004 per share or an aggregate of $5,383.

On March 31, 2008, we issued 594,781
shares of our common stock to Carol Limachi, an employee residing in Bolivia, for accrued
wages, at $0.004 per share or an aggregate of $2,320.

On March 31, 2008, we issued 537,254
shares of our common stock to Wilson Garcia, an employee residing in Bolivia, for accrued
wages, at $0.004 per share or an aggregate of $2,095.

On March 31, 2008, we issued 537,960
shares of our common stock to Juan Calderon, an employee residing in Bolivia, for accrued
wages, at $0.004 per share or an aggregate of $2,098.

On March 31, 2008, we issued 416,828
shares of our common stock to Julio Mamani, an employee residing in Bolivia, for accrued
wages, at $0.004 per share or an aggregate of $1,626.

On March 31, 2008, we sold 10,205,128
shares of our common stock to Miguel Simon Guardia, a resident of Bolivia, at $0.0039 per
share or an aggregate of $39,800.

On March 31, 2008, we issued
3,205,128 shares of our common stock to Tracy Madsen, an officer of the company, for
accrued wages, at $0.0078 per share or an aggregate of $25,000.

On April 11, 2008, we sold 77,345,203
shares of our common stock to Edmundo Arauz, a resident of Bolivia, at $0.00345 per share
or an aggregate of $262,973.69.

In every issuance described above we
relied upon Sections 4(2) and 4(6) of the Securities Act for the offer and sale. In ten
cases, as indicated above regarding residents of Bolivia, we also relied on Regulation S
promulgated under the Securities Act regarding non-residents of the United States. We
believed that Sections 4(2) and 4(6) were available because the offers and sales did not
involve a public offering, there was no general solicitation or general advertising
involved in the offers or sales and the purchasers were accredited investors. Our reliance
on Regulation S was based on the fact that ten of the purchasers were non-residents of the
United States. We placed restrictive legends on the certificates representing these
securities stating that the securities were not registered under the Securities Act and
are subject to restrictions on their transferability and resale.

# Use of Proceeds

Not applicable. Although we received
proceeds from the sale of our private placement common stock and Series B Preferred Stock,
as described above and under the immediately above indicated exemptions, we did not file
any Registration Statement during our 2007 Fiscal Year, whereby we would receive proceeds
from the resale of our common stock by Selling Shareholders or sale of any securities by
us to the public.

30

# Purchases of Equity
Securities by the Issuer and Affiliated Purchasers

Not applicable. We made no
repurchases or our equity securities during our Fiscal Year 2007.

# Item 6.
Selected Financial Data

# Item 7.
Managements discussion and analysis of financial condition and results of operations

Overview We are engaged in minerals industry
related operations in Bolivia and seek to generate revenues, income and cash flows from
the sale of gold and copper. We have generated no revenues since approximately November
2004. Since inception, our operations have been severely impacted from a lack of working
capital and financing. Additionally, our operations have experienced additional cost and
time delays due to the remote location of our Bolivian properties and our headquarters
being more than 4,000 miles from our corporate offices.

From our inception, we have not been
profitable. We have financed our operations through debt and equity placements to
accredited investors. These placements have diluted the interests of our existing
shareholders, but have allowed us to continue the development necessary to commence and
continue our production at our Cangalli claims and to acquire and maintain our other
prospects, in addition to allowing us to complete our administrative obligations. We have
at times encountered difficulties in meeting our obligations to pay our bills timely. We
currently have various obligations that are past due. We have paid most of our bills
through the present through equity and debt financing, with the exception of currently due
obligations.

# Uncertainties and Trends

Our revenues are dependent now, and
in the future, upon the following factors:

|o | Price
volatility in worldwide commodity prices, including gold, copper and other minerals,
which is          affected by: (a) interest rates; (b) currency exchange rates; (c)
currency exchange rates; (c) inflation          or deflation;  and (d) speculation;
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Global
and regional supply and demand of  gold, copper and other minerals, including investment,
         industrial and jewelry demand;
|- | ----------------------------------------------------------------------------------------------------------------------------------------

|o | Political
and economic conditions of major gold, copper or other mineral-producing countries; and
|- | -------------------------------------------------------------------------------------------------

|o | Threatened
changes to the Bolivia Mining Law that may cause increased regulations, greater controls
over          our mining activities, or other unanticipated consequences, and related
increased costs of conducting          operations in Bolivia
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

31

The following discussion and analysis
should be read in conjunction with our Consolidated Financial Statements and notes
thereto.

(a)    
          Liquidity and capital resources  2007 and 2006

# (a)(1) Continuing
working capital deficit

Our working capital deficit for at
least the past five years has limited our ability to expand our operations and pursue our
business plan. The following table sets forth our continuing working capital at December
31, 2007 and 2006.

|                          |            |           
|------------------------- | ---------- | ----------
|Years ended December 31,  | 2007       | 2006      
|                          |            |           
|Current Assets            | $96,792    | $21,625   
|Current Liabilities       | (913,735)  | (803,720) 
|                          |            |           
|Working Capital (Deficit) | ($816,943) | ($782,095)

Our current assets increased by
$75,167 from $21,625 as of December 31, 2006 to $96,792 for the comparable 2007 period.
The increase was due to a $1,315 increase in cash and a $73,852 increase in prepaid
expenses.

Our working capital deficit
increased by $34,848 or 4% to $816,943 as of December 31, 2007, from $782,095 for the
comparable 2006 period.  Accounts payable and accrued expenses decreased from $271,947 on
December 31, 2006 to $193,558 on December 31, 2007.    Accounts payable and accrued
expenses decreased as a result of our reduction of expenses and the payment of
outstanding bills.    Other notes payable increased from $32,002 as of December 31, 2006,
to $214,111 on December 31, 2007. The increase was primarily due to the reclassification
of a $135,000 note payable to Kevin Pfeffer, a former director from related party debt to
other notes payable.  Since Mr. Pfeffer is no longer our director and as of December 31,
2007, he no longer holds more than 10% of our outstanding shares, he is no longer
considered our affiliate. On January 25, 2008, we reached settlement with Mr. Pfeffer
wherein all of the debt owed to him in the form of accounts payable, a note payable and
accrued interest as well as a settlement fee were converted into our common stock.

Related party debt decreased to
$92,300 as of December 31, 2007 from $151,900 on December 31, 2006.  The decrease was the
result of the reclassification of debt owed to Mr. Pfeffer as described immediately above
and the addition of additional funds loaned to us by our officers both in the United
States and In Bolivia.

32

A convertible debenture that we had
in 2006 remained constant in 2007 at $249,000. This convertible debenture matured on May
2, 2007, however, we have been unable to repay this debenture in cash and have extended
our obligation into the successive year in accordance with the debenture's terms.  We
have made a proposal to the estate governing this note to convert the debenture to common
stock, as defined in the debenture agreement.  At this time, we have not received a
response to our proposal from the administrator of the estate; however, we have notified
the estate of our intention to extends the debenture principal over for the one
additional remaining year, through May of 2009, and of our intentions to enter into a
payment schedule that would allow us to become current on the accrued interest owed for
2007 and pay the first quarter payment for 2008. The debenture principal shall
come due in May of 2009.

Accrued interest increased to
$110,187 as of December 31, 2007, from $43,634 as of December 31, 2006.  The increase was
due to the accrual of interest on the outstanding notes including $32,000 in penalty
interest which we paid to Kevin Pfeffer in common stock as part of a settlement reached
with him in January 25, 2008.

We also owe past-due salary
obligations to our president, Terry C. Turner. During 2007, Mr. Turner waived $60,000 of
his salary accrual that was past due.  Additionally, on December 31, 2004 through 2006,
Mr. Turner waived $60,000 each year and in 2003 and 2001, Mr. Turner waived  $36,457 and
$443,772 respectively of accrued salary without receiving any consideration from us. We
continue to owe Mr. Turner $276,783 in back salary; however, he has agreed with us that
this liability bears no interest. A note receivable from Mr. Turner in the amount of
$276,783 that resulted during a period that we were unable to consistently pay Mr.
Turner's salary and he relied on irregular loans from us offsets this liability. That
loan arrangement pre-dated the passage of the Sarbanes-Oxley Act. The receivable from Mr.
Turner and payable to Mr. Turner are netted out to a zero balance and do not appear on
our balance sheet.

Our working capital deficit during
2007 was also affected by the receipt and related expenditure of more than $1,555,302
from the sale of our Series B Preferred stock or received as a note payable which was
subsequently converted to our Series B Preferred Stock. These funds permitted us to cover
other short-term obligations and reduced our working capital deficit.

We continue to focus on conserving
cash, setting priorities for our most important obligations and seeking other means to
pay or defer any obligations as necessary as a result of our continuing working capital
deficit.

# (a)(2)      Property and
equipment

During 2007, we increased our
property and equipment net of depreciation and impairment by $172,909, or 3.1%, to
$5,652,686 at December 31, 2007 as compared to $5,479,777 at December 31, 2006.   Mining
equipment decreased by $383,513 to $595,190 as of December 31, 2007 from $978,703 as of
December 31, 2006.  The majority of this decrease came from the elimination of $272,502
from mining equipment that was originally depreciated during 2002 and a corresponding
amount was listed under accumulated depreciation. As these two amounts were netted each
other the net impact on property and equipment less accumulated depreciation was zero. As
this equipment is no longer usable, the $272,502 amount was removed from both the asset
account and the accumulated depreciation amount. During the years 2004 through 2007, we
fully impaired our mining assets associated with our Cangalli project.  Prior to this
year we carried both the asset value and the accumulated impairment associated with that
asset and which netted out to zero. During 2007, we determined that we would eliminate
both the value of the asset and the accumulated impairment associated with that asset.
 As a result, as of December 31, 2007 we eliminated $490,423 from mine development costs
and an equal amount form accumulated depreciation.  This total amount had been previously
impaired.  Additionally, we increased mine development costs by $297,065 for capitalized
fees related to our development of our A Zone on our Buen Futuro claims, as well as our C
Zone. We also eliminated $417,047 from mineral properties and a corresponding amount from
accumulated impairment for the same reasons listed above.  While the net effect of these
eliminations is zero we believe that it simplifies our internal accounting and better
reflects our current financial situation to the readers of this report.  We continue to
include $545,000 in mineral properties which has been fully impaired and which a
corresponding amount is included in accumulated impairment for accounting purposes and
which we feel accurately portrays the financial condition of the company.  The inclusion
of this amount does not impact our total assets or total shareholders' equity.  A detail
of our fixed assets is the following;

33

|                                                   |            |            
|-------------------------------------------------- | ---------- | -----------
|Years ended December 31,                           | 2007       | 2006       
|                                                   |            |            
|Mining equipment                                   | $595,190   | $978,703   
|Gold Bar Mill and Plant - idle                     | 3,980,000  | 3,980,000  
|Mine development costs                             | 336,260    | 529,618    
|Mining properties                                  | 1,356,948  | 1,814,501  
|Office equipment                                   | 110,710    | 118,555    
|Vehicles                                           | 110,018    | 87,018     
|Accumulated depreciation, depletion and impairment | (836,438)  | (2,028,618)
|                                                   |            |            
|Fixed assets net                                   | $5,652,686 | $5,479,777 

# (a)(3) Capital
commitments

Our capital commitments are set out
below:

|                                      |            |                  |              |             
|------------------------------------- | ---------- | ---------------- | ------------ | ------------
|Contractual Cash Obligations          | Total      | Less than 1 year | 1 to 3 years | 3 to 5 years
|                                      |            |                  |              |             
|Accounts payable and accrued expenses | $193,558   | $193,558         | $-           | $-          
|Deferred wages                        | 54,529     | 54,529           | -            | -           
|Other notes payable                   | 214,111    | 214,111          | -            | -           
|Related party payable                 | 92,350     | 92,350           | --           | --          
|Accrued interest                      | 110,187    | 110,187          | --           | --          
|Debenture payable                     | 249,000    | 249,000          | -            | -           
|Exploration & production Buen Futuro  | 435,834    | -                | 435,834      | -           
|Production penalties consulting fees  | 205,000    | 61,000           | 72,000       | 72,000      
|Mining claim fees                     | 590,655    | 118,131          | 236,262      | 236,262     
|Building leases                       | 9,014      | 9,014            | -            | -           
|                                      |            |                  |              |             
|Total contractual cash obligations    | $2,154,238 | $1,1,101,880     | $744,096     | $308,262    

34

# (a)(4) Derivative
liability

As discussed in Part II, Item 5
Preferred Stock, we issued 1,988,599 shares of Series B Preferred Stock on December 29,
2006 in exchange for debt. During the first quarter of 2007, we issued 461,301 shares of
Series B Preferred Stock for cash from investors and 12,103 shares of Series B Preferred
Stock to 9 employees for services. During the second quarter of 2007 we issued 963,960
shares of Series B Preferred Stock for cash and for the conversion of debt. During the
third quarter of 2007 we issued 130,041 shares of our Series B Preferred Stock for cash
and the conversion of existing debt and accrued interest. A total of 3,556,004 shares of
Series B have been issued as of December 31, 2007. This preferred stock has conversion
rights that allow the holders to convert each Series B preferred share into 250 restricted
shares of our common stock. Because no common shares were available for conversion at the
time the Series B Preferred shares were issued, we classified these preferred shares as a
derivative liability of $3,556,004, rather than equity. Additionally, the preferred shares
conversion rate was at a discount on the date the preferred shares were issued. The market
price on the date of issuance ranged from $.008 per share to $.027 per share. If the
Series B preferred shares were converted on that same date they would have had a
conversion value of $.004 per common share. As this resulted in a beneficial conversion to
the market rate for the Series B preferred shares, the accounting rules of beneficial
conversion applied. As a result, we are required to expense the difference between the
conversion price and the market price as a financing expense. The offsetting entry is also
carried as a derivative liability in the amount of $6,639,786. As there is no time limit
or period designated for the conversion of the preferred shares, the entire amount of the
beneficial conversion is taken in the year incurred. The total amount of the derivative
liability was $10,195,790. On September 14, 2007 at a special meeting of our shareholders,
our shareholders approved the increase of our authorized common shares to 2,000,000,000
shares. On September 18, 2007 we amended our articles of incorporation to reflect the
increase in authorized common shares to 2,000,000,000 shares. At the time the articles of
incorporation were amended we had sufficient common shares available in which to convert
all of our outstanding Series B Preferred Shares to common shares. As common shares were
available for conversion the entire amount of the derivative liability of $10,195,790 was
transferred to additional paid in capital which as a result caused out total
shareholders equity to increase to $4,779,534 as of December 31, 2007. As of March
11, 2008, 96% of the outstanding Series B shares had been converted to common shares,
leaving 4,374,998 Series B shares available for issue.

# (a)(5) Equity

Stockholders equity increased
to $4,665,738 as of December 31, 2007, from $720,486 as of December 31, 2006. The primary
reason for the increase was the classification of the derivative liability related to the
issuance of Series B Preferred Stock, which was convertible into common stock. Prior to
our shareholders meeting on September 15, 2007 there were no common shares available in
which to convert the Series B Preferred shares. As such, the issuance of preferred stock
either for debt or for cash was classified as a derivative liability. The derivative
liability as of December 31, 2006 was $3,977.196 which caused shareholders equity to
decline to $720,485 as of December 31, 2006, from $4,386,011 as of December 31, 2005.
During 2007, prior to September 15, 2007, an additional derivative liability of 6,218,594
was incurred as a result of the issuance of Series B Convertible Preferred Stock since
there was no common stock in which to convert. During the September 14, 2007 shareholders
meeting our shareholders voted to increase the total shares authorized for issuance by us
to 2,000,000,000. At that point in time since there was now available shares in which to
convert the Series B Convertible Preferred shares the derivative liability of $10,195,790
was converted into additional paid in capital which resulted in the increase in total
shareholders equity.

35

# (a)(6) Off-balance sheet
arrangements.

We
have not entered into any transaction, agreement or other contractual arrangement with an
entity unconsolidated with us under whom we have;

|o | an
obligation under a guarantee contract,
|- | -----------------------------------------

|o | a
retained or contingent interest in assets transferred to the unconsolidated entity or
similar          arrangement that serves as credit, liquidity or market risk support to
such entity for such assets,
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | any
obligation, including a contingent obligation, under a contract that would be accounted
for as a          derivative instrument, or
|- | ---------------------------------------------------------------------------------------------------------------------------------------

|o | any
obligation, including a contingent obligation, arising out of a variable interest in an
         unconsolidated entity that is held by us and material to us where such entity
provides financing,          liquidity, market risk or credit risk support to, or engages
in leasing, hedging or research and          development services with us."
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We do not have any off-balance sheet
arrangements or commitments that have a current or future effect on its financial
condition, changes in financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures, or capital resources that is material, other than those
which may be disclosed in this Managements Discussion and Analysis of Financial
Condition and the audited Consolidated Financial Statements and related notes.

# (a)(7) Results of
operations.

36

The following sets forth certain
information regarding our results of operations as of December 31, 2007 and 2006.

|                                            |             |            
|------------------------------------------- | ----------- | -----------
|Years ended December 31,                    | 2007        | 2006       
|                                            |             |            
|Revenues                                    | $-          | $-         
|Production costs                            | -           | -          
|Exploration & development costs             | (297,776)   | (262,820)  
|General and administrative                  | (1,218,035) | (1,293,741)
|Depreciation and depletion                  | (25,043)    | (54,032)   
|Operating (loss)                            | (1,540,855) | (1,610,594)
|Loss on sale of fixed assets                | (1,509)     | (109,495)  
|Asset impairment                            | (107,425)   | (286,867)  
|Financing costs of preferred stock          | (4,647,263) | (1,988,598)
|Other income (loss)                         | 11,764      | 14,616     
|Net (loss)                                  | (6,377,636) | (4,275,892)
|Net (loss) per share - basic and diluted    | (.01)       | (.01)      
|Weighted average shares - basic and diluted | 830,814,298 | 774,969,305

Our operations have resulted in
significant losses and negative cash flow from operations during approximately the past
five years as we have invested in exploration on our mining concessions, and in property
acquisitions.

Revenue.
          During both 2007 and 2006, our revenues were $0. We have generated no revenues
          from mine production since 2004 as a result of the shutdown of our Cangalli mine
          during that year.

Production costs. Production
costs remained $0 during 2007 and 2006.

Exploration & development.
Exploration and mine development costs increased by $34,956, or 13%, to $297,776 during
2007 from $262,820 during 2006. The increase in 2007 was the result of increased
exploration at our Buen Futuro A Zone project through a contract with Washington Group
International Inc. related to the review of our A Zone feasibility study. We also
completed extensive exploration work on our B and C Zones during 2007 as we brought a
pilot plant on-line at the C Zone. As a result of environmental issues we moved the site
for our C Zone production plant and began construction of required infrastructure during
the fourth quarter of 2007.

General and administrative
expenses. Our general and administrative expenses decreased by $75,707, or 6%, to
$1,218,035 during 2007 from $1,293,741 during 2006. We attribute the decrease in our
general and administrative expenses to an ongoing cost control effort and to the reduction
in support staff. While we will continue our efforts to reduce these expenses, they may
increase as we complete construction and begin operation of C Zone production plant and
continued exploration and development of our Buen Futuro A Zone project.

Legal expenses in 2007 decreased to
$92,499 from $236,535 in 2006. The decrease was due in part to legal expenses accrued in
2006 related to our shareholders meeting which were paid in stock during 2007. Legal
expenses also were decreased by $6,760 as the result of a settlement for payment on legal
fees incurred and owed in a previous period.

Depreciation and depletion.
Depreciation and depletion decreased to $25,043 in 2007 from $54,032 in 2006. The decrease
in 2007 was the result the decrease in the amount of equipment being depreciated through
the sale and disposal of equipment in previous periods.

37

Operating expenses. During
2007, our operating expenses decreased by $69,739 or 4% to $1,540,855 from $1,610,594
during 2006. The decrease was the result of a reduction of staff and an overall decrease
in general and administrative expenses including legal expenses and depreciation.

Interest expense. Interest
expense during 2007 decreased to $92,349 from $294,953 during 2005. The decrease during
2007 was primarily the result of the elimination of $1,988,598 in debt and accrued
interest on December 29, 2006 which was converted into our Series B Convertible Preferred
Stock and was subsequently converted into our common stock during the fourth quarter of
2007. The interest expense total also includes $35,000 in penalty interest related to the
settlement reached in January 2008 with Kevin Pfeffer in addition to the regular interest
accrued on his note.

Loss on sale of fixed assets.During 2007 we experienced a loss on sale of fixed assets in the amount of $1,509
compared to $109,495 during 2006. We may sell some equipment that is not necessary for our
current mining plan. We are also considering the sale of the Gold Bar mill and plant after
determining if we will dismantle it in Nevada and send it to eastern Bolivia to be
constructed on our Buen Futuro A Zone project. A sale of Gold Bar during 2008 may either
result in a loss on the sale of assets or a gain depending on the final sales price. As we
currently do not have any firm offers we cannot determine if a sale will take place or at
what price a sale could be consummated.

Asset impairment. During 2007,
we incurred an impairment expense of $107,425 which was related to our Cangalli mine. We
have fully impaired all assets related to our Cangalli operation with the exception of
certain buildings located in Cangalli which we are attempting to sell during 2008.

Financing costs. During 2007
we incurred financing costs related the issuance of our Series B Convertible Preferred
stock in the amount of $4,647,263. During 2006, we also incurred financing costs on the
issuance of preferred stock in the amount of $1,988,598. This expense was the result of
the issuance of Series B preferred stock to debt holders and for cash consideration with a
conversion rate less than the market price on the date of issuance. A more complete
description of this transaction can be found in Part II, Item 6(a) (4), Derivative
Liability. The Series B preferred shares carry a conversion provision, which allowed each
Series B preferred share to be converted into 250 restricted common shares. At the time of
the issuance of our preferred stock we had no common shares available in which to convert
the Series B preferred shares On September 14, 2007 at a special meeting of our
shareholders, our shareholders approved the increase of our authorized common shares to
2,000,000,000 shares. On September 18, 2007 we amended our articles of incorporation to
reflect the increase in authorized common shares to 2,000,000,000 shares. At the time the
articles of incorporation were amended we had sufficient common shares available in which
to convert all of our outstanding Series B Preferred Shares to common shares. At that
point in time since there was now available shares in which to convert the Series B
Convertible Preferred shares the derivative liability of $10,191,864 was converted into
additional paid in capital which resulted in the increase in total shareholders
equity.

38

Net loss. Our net loss for
2007 was ($6,377,636) compared to ($4,275,892) during 2006, resulting in a basic per-share
loss of $(.01) in 2007 and $(.01) in 2006 based on weighted average shares outstanding
 basic of 830,814,298 and 774,969,305 respectively.

The majority of the net loss during
2007 and 2006 was related to financing costs related to the issuance of our Series B
Convertible Preferred shares. As described in Part II, Item 5, (e)(3) the derivative
liability associated with the financing costs was converted to additional paid in capital
at the time sufficient common shares became available for conversion following the vote by
our shareholders to increase the authorized common share total to 2,000,000,000 shares.
Had financing costs not been included the net loss during 2007 would have been $1,730,373
a 556,921 or 24% decrease from the adjusted $2,287,294 net loss incurred during 2006.

Since commencing operations, our
general, administrative and other costs have exceeded the resources we have generated
through operations. As described above in Liquidity and Capital Resources, we
have been dependent on loans from affiliated and unaffiliated parties, and debt/equity
financing, to meet our working capital obligations and to finance our continuing operating
losses. Our current lack of production further complicates our ability to raise cash from
these sources. There can be no assurance that we will be able to continue to finance our
operating losses in such a manner. We have, however, been able to raise additional funds
in the past and we believe that we will be able to do so in the future.

# (a)(8) Cash flow

We have been able to meet our working
capital obligations and cover our net loss through the issuance of stock for cash and
services as referenced above in Part II Item 5. By deducting certain other non-cash
expenses, we achieved net cash flows from operating activities of ($1,510,843) in 2007 and
($1,175,901) in 2006. We also invested $306,887 in property and equipment during 2007 and
$72,889 in property and equipment in 2006 and received $236,838 during 2006 from the sale
of equipment. Net cash flows provided by our financing activities totaled $1,819,045 in
2007 and 983,234 in 2006. Cash increased to $2,742 as of December 31, 2007 from $1,427 in
2006.

39

|                                                |              |             
|----------------------------------------------- | ------------ | ------------
|Net cash flows                                  |              |             
|Years ended December 31,                        | 2007         | 2006        
|                                                |              |             
|Net gain (loss)                                 | ($6,377,636) | $(4,275,892)
|Net cash flows used by operating activities     | (1,401,837)  | (1,175,901) 
|Cash flows from investing activities            | (306,887)    | 163,949     
|Net cash flows provided by financing activities | 1,710,039    | 983,234     
|Net increase (decrease) in cash                 | 1,315        | (28,718)    
|Cash beginning of period                        | 1,427        | 30,145      
|Cash end of period                              | 2,742        | $1,427      

We have used our equity to acquire
property, raise cash necessary to pay expenses, payment for services in lieu of cash
payments for services and to repay indebtedness. Our ability to continue to use our equity
for those purposes is dependent on the price and trading volume of our common stock, both
of which are volatile, and our ability to comply with federal and applicable state
securities laws.

From time-to-time, as necessary, our
officers have deferred collection of their salaries and have advanced funds to us on a
short-term basis to conserve our cash for other purposes. We have also negotiated with
certain debt holders to accept equipment for outstanding debt or to convert debt to
preferred stock, including:

|o | $92,350
of  loans from current directors and officers
|- | -----------------------------------------------------

|o | Our
officers have also deferred payment of a portion of their 2007 salary until funds are
         available to pay these wages. As of December 31, 2007 a total deferred salary
from          officers was $33,284.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Although we have been successful in
obtaining funds to date, there can be no assurance that we will be able to continue to be
successful in doing so. Our ability to finance our operations will, in the end, be
dependent on our ability to generate cash flow from operations, of which there can be no
assurance.

# (b) Special non-cash
impact due to options

No options have been issued during
the past three years. No options are currently outstanding.

# (c) Plan of operations

|(1) | Our
current plan is to complete construction of the C Zone mill and commence
               commercial mining operations at the C Zone during the second quarter of
2008.                During 2007, we completed exploration and feasibility work on the
gold                mineralization of the C Zone of our Precambrian properties in eastern
Bolivia,                which are located approximately 5 kilometers (3.1 miles) from the
A Zone of our                Buen Futuro project. Additionally, we built and operated a
pilot plant on the C                Zone, which we have used to refine the metallurgical
process on the                mineralization in the zone. During September of 2007, as a
result of                environmental issues, we moved the location of our production
mill approximately                700 meters (2,300 feet) to the southwest of our pilot
plant to eliminate the                potential impact on a nearby marshland and to
permit the potential capacity of                our plant to increase to 2,000 tpd from
the original 1,000 tpd of our original                plant design. On November 30, 2007,
we held a successful public hearing which                cleared the last regulatory
hurdle in order to commence construction on the new                production plant. At
approximately the same time we began experiencing                torrential rains in the
area that far exceeded the normal rainfall for this                region, referred to by meteorologists as the 100 year rains. These rains have                severely limited
our ability to complete construction on the mill due to the                conditions of
the roads in the region and our ability to pour concrete. Once we                have a
period of dry weather we intend to finalize construction on the mill and
               begin production starting at approximately 400 tpd and increasing to 2,000
tpd.                We intend to use a contract mining company to deliver the ore from
our C Zone                mine directly to our mill. The contract miner estimates that it
can mine and                deliver ore at a cost of $2.00 per tonne once we have reached
2,000 tpd. The use                of a contract miner will eliminate the capital costs
required to purchase mining                equipment.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

40

| | During 2007
we completed construction of our mine camp situated between our A Zone development and
the C Zone mine and mill. The mine camp includes dormitories, a dining hall, sanitation
facilities, administration buildings and warehouses and serves as camp for the
construction and operation of the C Zone mill and the exploration and development of our
A Zone project.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | We
intend to further develop the potential of the A Zone of our Buen Futuro gold
               and copper project in eastern Bolivia during 2008. We are pursuing this
               development by obtaining third party advice regarding our feasibility and
               exploration studies by a major independent mining and engineering firm. In
               February 2007 we entered into an agreement with Washington Group
International,                Inc. (www.wgint.com) to carry out the necessary due
diligence work to advise us                regarding our feasibility studies. We may ask
this engineering firm to determine                if our Gold Bar mill and plant should
be moved to our A Zone Buen Futuro project                in eastern Bolivia, or if a new
mill and plant should be built on site. During                this period we will also
begin securing final environmental permitting and any                additional surface
land acquisitions that may be required.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Finally,
we intend to maintain our Cangalli and Tipuani Valley properties.                However,
no efforts will be made to recommence operations at the Cangalli mine                in
the foreseeable future. All of our efforts and financial resources are
               focused on developing our Precambrian properties in eastern Bolivia.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

All of the foregoing, and related
plans stated below, are contingent upon receiving an estimated $11.5 million of financing.
We may, however, continue with some of these plans as funds are available which are
detailed as follows:

To accomplish our strategy we intend
to:

|o | Obtain
estimated financing of $200,000 for the remaining costs pertaining to the construction
and operation of a 1,000-tpd processing plant on our C Zone gold project and an
additional $200,000 to increase our capacity to 2,000 tpd. We also intend to secure
between $600,000 and $1 million to continue our in-fill drilling, metallurgical studies
and final feasibility work for our Buen Futuro A Zone, as well as our B and C Zones. We
are now in the process of installing our C Zone mill on its new mill site, which we
intend to incrementally expand its capacity to five hundred cubic meters (approximately
1,000 tonnes) per day.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

41

|o | Obtain
third party, independent advice from Washington Group International, Inc. regarding any
required improvements to our existing reserve report and feasibility study of our Buen
Futuro A Zone project. On February 13, 2007 we signed an agreement with Washington Group
International for due diligence and an initial evaluation of our feasibility work to
date.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Carry
out any additional feasibility, exploration, confirmation and engineering work beyond the
initial contract as recommended by the initial due diligence and evaluation study being
performed by Washington Group International, Inc. We announced in the first quarter of
2008 that the evaluation from this consulting firm was favorable and that the consulting
engineers recommended moving to a second stage of feasibility work. We anticipate that
this additional work may cost between $600,000 and $1 million, which we will need to
raise for this purpose. Additional work may include an in-fill drilling program and
testing; trench and pit sampling; retesting of previously obtained samples; site
inspections; metallurgy and plant engineering. We anticipate that this additional study
and confirmation work will help us determine if the Gold Bar mill and plant should be
dismantled, shipped to eastern Bolivia and re-erected on our Buen Futuro A Zone site, or
if a new plant should be built on-site.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Determine,
if and when the third party due diligence and evaluation study indicates that a
large-scale gold and copper mining and processing operation should be commenced on our
Buen Futuro A Zone, whether to develop the mine and build a milling and processing
facility at our Buen Futuro A Zone. Should further due diligence, evaluation and
feasibility work indicate that the Gold Bar mill and plant should be used in Bolivia, we
intend to dismantle the plant located outside of Eureka, Nevada, ship it to eastern
Bolivia, and re-erect the mill and plant on the Buen Futuro A Zone site. We estimate
approximate costs of $10,000,000 to bring the Gold Bar mill and plant into production in
Bolivia; however, those costs may vary significantly depending on the findings of the
third party due diligence and evaluation study. We anticipate that all construction and
mining may be subcontracted to an international engineering and mining firm with the
necessary experience to complete the project.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Determine,
should the initial due diligence and evaluation study indicate that a mill and processing
plant be built from scratch on the Buen Futuro A Zone, whether we intend to either sell
the Gold Bar mill and plant and use the proceeds for new mill and plant construction on
the A Zone, or consider the possibility of performing contract milling and processing at
the current Gold Bar site in Nevada. Cost estimations for potential new mill construction
at the A Zone are being evaluated under the current due diligence and evaluation work
being performed.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Determine,
should the current Buen Futuro A Zone due diligence and evaluation study indicate that it
is not in the our best interest to move the Gold Bar mill and plant to Bolivia, whether
we should consider other alternatives to selling the facility in its entirety.
The region around our Gold Bar mill has recently experienced increased gold mining
activity as a result of the current international price for gold. We also believe that
there is a milling and processing shortfall in the region that may present us an
opportunity to recommence Gold Bar mill and plant operations on a contract basis as a
tolling facility. We are currently evaluating this possibility and the potential benefits
to us. We estimate that it will take approximately $1 million to bring Gold Bar mill back
online to accept contract milling and processing work. However, other costs that we have
under evaluation, such as permitting and new tailings impoundment construction, could
easily be significantly more expensive than the mill rehabilitation costs, and may exceed
$15 million.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

42

|o | Maintain
our mining claims on the remainder of the Buen Futuro 2,500 acre-site not included in the
A Zone, as well as the remainder of our 134,000-acre landholding in the Precambrian
Shield surrounding the Buen Futuro claims. We intend to continue to perform exploration
work on these properties since our existing feasibility studies to date have concentrated
principally on the 75-acre parcel that is the A Zone. We anticipate costs for this
additional exploration work to total $1,000,000 over the next two years.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Continue
our discussions with government officials in Bolivias new administration, and
others, relative to the issues impeding the development of our Cangalli gold mine and
Cangalli and Tipuani Valley mining claims. We intend to maintain our Cangalli and Tipuani
Valley claims, but cannot guarantee that they will ever be developed or that operations
will recommence there.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# (d) Impact of inflation
and changing prices

We have not experienced any impact
from the effects of inflation during the last two operating periods: 2007 or 2006.
Bolivian inflation, while high at points during the early 1980s, has been relatively
stable, at less than 10% since 1985, during the last two years at less than 4% per annum,
and is projected to be less than 3% in 2008.

# (e) Accounting policies

# (e)(1) Critical
accounting policies

In accordance with Emerging Issues
Task Force No. 98-5, Accounting for Convertible Securities with Beneficial Conversion
Features or Contingently Adjustable Conversion Ratios, and No. 00-27, Application of Issue
No. 98-5 to Certain Convertible Instruments, we recognize the value of conversion rights
attached to convertible debt or preferred stock. These rights give the debt or preferred
stock holder the ability to convert the instruments into common stock at a price per share
that is less than the trading price to the public on the day the transaction occurs. The
beneficial value is calculated as the market price of the common stock at the commitment
date in excess of the conversion rate of the instruments and related accruing interest or
dividends is recorded as a discount to the related debt (increase in preferred dividends
for preferred stock) and addition to additional paid in capital. Debt discount is
amortized over the remaining outstanding period of related debt.

Stock based compensation: from time
to time, we issue shares of common stock as payment for services to consultants and
employees. Any stock issued for this purpose is priced and accounted for at the actual
closing market price on the day of issue. The total number of shares issued times the
closing stock price is booked as an expense.

43

Mineral exploration costs are
expensed as incurred. Mine infrastructure development costs incurred prior to establishing
proven and probable reserves are expensed. When it has been determined that a mineral
property can be economically developed, the costs incurred to develop such property,
including costs to further delineate the ore body and remove overburden to initially
expose the ore body, are capitalized as incurred and are amortized using the
units-of-production (UOP) method over the estimated life of the ore body based
on estimated recoverable ounces mined from proven and probable reserves. If no mineable
ore body is discovered, such costs are expensed. We continually review our assets to
determine if their value has become clouded or impaired. We will impair an asset if the
present value of the cash flow or the current market value of the asset does not exceed
the value carried on the balance sheet.

To the extent that development costs
benefit the entire ore body, they are amortized over the estimated life of the ore body.
Costs incurred to access specific ore blocks or areas that only provide benefit over the
life of that area are amortized over the estimated life of that specific area. The
capitalized cost bases subject to depletion expense are calculated on a formula based on
the number of tonnes of ore that are expected to be mined against the total tonnes in
proven and probable reserves and extrapolated to the number of tonnes in the area of
influence of the mine.

Mineral interests and other
intangible assets include acquired mineral rights and royalty interests in production,
development and exploration stage properties. The amount capitalized related to a mineral
or royalty interest represents its fair value at the time it was acquired.

# (e)(2) Effect of new
accounting pronouncements

In February 2006, the FASB issued
SFAS No. 155, ACCOUNTING FOR CERTAIN HYBRID FINANCIAL INSTRUMENTS AN AMENDMENT OF FASB
STATEMENTS NO. 133 AND 140.This Statement amends FASB Statements No. 133, accounting for
Derivative Instruments and Hedging Activities, and No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities. This statement resolves
issues addressed in Statement 133 Implementation Issued No. D1, Application of
Statement 133 to Beneficial Interests in Securitized Financial Assets. The adoption
of SFAS No. 155 did not have an impact on the Companys consolidated financial
statements.

In March 2006, the FASB issued SFAS
No. 156, ACCOUNTING FOR SERVICING OF FINANCIAL ASSETS AN AMEDNMENT OF FASB STATEMENT No.
140. This Statement amends FASB Statement No. 140, Accounting for Transfers and Servicing
of Financial Assets and Extinguishments of Liabilities, with respect to the accounting for
separately recognized servicing assets and servicing liabilities. The adoption of SFAS No.
156 did not have an impact on the Companys consolidated financial statements.

In September 2006, the FASB issued
SFAS No. 157, FAIR VALUE MEASUREMENTS. This statement defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles (GAAP), and
expands disclosures about fair value measurements. This Statement is effective for
financial statements issued for fiscal years beginning after November 15, 2007, and
interim periods within those fiscal years. The adoption of SFAS 157 did not have an impact
on the Companys consolidated financial statements. The Company presently comments on
significant accounting policies (including fair value of financial instruments) in Note 2
to the financial statements.

44

In September 2006, the FASB issued
SFAS No. 158, EMPLOYERS ACCOUNTING FOR DEFINED BENEFIT PENSION AND OTHER
POSTRETIREMENT PLANS AN AMENDMENT OF FASB STATEMENTS NO. 87, 88, 106 AND 132(R). This
statement improves financial reporting by requiring an employer to recognize the
overfunded or underfunded status of a defined benefit postretirement plan (other than a
multiemployer plan) as an asset or liability in its statement of financial position and to
recognize changes in that funded status in the year in which the changes occur through
comprehensive income of a business entity or changes in unrestricted net assets of a
not-for-profit organization. The adoption of SFAS No. 158 did not have an impact on the
Companys consolidated financial statements.

In February 2007, the FASB issued
SFAS No. 159, THE FAIR VALUE OPTION FOR FINANCIAL ASSETS AND FINANCIAL LIABILITIES 
INCLUDING AN AMMENDMENT OF FASB STATEMENT NO.115. This statements objective is to improve
financial reporting by providing the Company with the opportunity to mitigate volatility
in reported earnings caused by measuring related assets and liabilities differently
without having to apply complex hedge accounting provisions. This statement is expected to
expand the use of fair value measurement, which is consistent with the FASBs
long-term measurement objective for accounting for financial instruments. The adoption of
SFAS 159 did not have an impact on the Companys financial statements. The adoption
of SFAS No. 159 did not have an impact on the Companys consolidated financial
statements.

In December 2007, the FASB issued
SFAS No. 160, NONCONTROLLING INTERESTS IN CONSOLIDATED FINANCIAL STATEMENTS  AN
AMENDMENT OF ARB NO. 51. This statements objective is to improve the relevance,
comparability, and transparency of the financial information that a reporting entity
provides in its consolidated financial statements by establishing accounting and reporting
standards that require ownership interests in the subsidiaries held by parties other than
the parent be clearly identified. The adoption of SFAS 160 did not have an impact on the
Companys financial statements.

In December 2007, the FASB issued
SFAS No. 141 (revised), BUSINESS COMBINATIONS. This revision statements objective is to
improve the relevance, representational faithfulness, and comparability of the information
that a reporting entity provides in its effects on recognizing identifiable assets and
measuring goodwill. The adoption of SFAS 141 (revised) did not have an impact on the
Companys financial statements.

# Item 7A. Quantitative
and Qualitative disclosures about Market Risk

45

Inapplicable.    
          We do not presently invest or otherwise engage in market risk sensitive
          instruments.

# Item 8. Financial
statements and supplementary data

The financial statements and
supplementary data required by this item is contained on pages F-1 through F-29.

# Item 9. Changes in and
disagreements with accountants on accounting and financial disclosure

There were no disagreements with our
accountants and auditors on any matters of accounting principles, practices or financial
statement disclosures during 2006 and 2007 through the present.

# Item 9A. Controls and
procedures

Our Chief Executive Officer and Chief
Financial Officer evaluated our disclosure controls and procedures on December 31, 2007 as
defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based
on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that
our disclosure controls and procedures are effective in connection with our filing of our
annual report on Form 10-K for the year ended December 31, 2007.

Changes in internal
controls. There were no significant changes in
our internal controls or in other factors that could significantly affect these internal
controls subsequent to the date of their evaluation.

# Management's Report on
Internal Control Over Financial Reporting

Internal control over financial
 reporting refers to the process designed by, or under the supervision of, our Chief
Executive  Officer and Chief Financial Officer,  and effected by our Board of Directors,
 management and other personnel,  to provide reasonable assurance regarding the
reliability of financial  reporting and the preparation of financial  statements for
external purposes in accordance with generally accepted accounting principles, and
includes those policies and procedures that:

|o | Pertain
 to the  maintenance  of records  that in  reasonable  detail  accurately  and fairly
 reflect  the  transactions  and                  dispositions of our assets;
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Provide
 reasonable  assurance that  transactions are recorded as necessary to permit
 preparation of financial  statements in                  accordance with generally
accepted accounting  principles,  and that our receipts and expenditures are being made
only                  in accordance with authorization of our management and directors;
and
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|o | Provide
reasonable  assurance  regarding  prevention or timely detection of unauthorized
 acquisitions,  use or disposition of                  our assets that could have a
material effect on the financial statements.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Internal control over financial
 reporting cannot provide absolute  assurance of achieving  financial  reporting
 objectives because of its inherent  limitations.  It is a process that  involves  human
 diligence and  compliance  and is subject to lapses in judgment and breakdowns resulting
from human failures. It also can be circumvented by collusion or improper management
override.

Because of such  limitations,  there
is a risk that  material  misstatements  may not be  prevented  or detected  on a timely
 basis by internal  control over  financial  reporting.  However,  these  inherent
 limitations  are known  features of the financial  reporting process.  Therefore,  it
is possible to design into the process  certain  safeguards  to reduce,  though not
 eliminate,  this risk.  Management is responsible for establishing and maintaining
adequate internal control over our financial reporting.

Management has used the framework
set forth in the report entitled Internal Control - Integrated  Framework  published by
the Committee of Sponsoring  Organizations  of the Treadway  Commission,  known as COSO,
to evaluate the  effectiveness  of our internal control over financial  reporting.  Based
upon this  assessment,  management has concluded that our internal  control over
financial  reporting was effective as of and for the year ended December 31, 2007 with
no exceptions:

Management  has concluded that other
than as described  above,  our internal  control over financial  reporting was effective
as of and for the year ended December 31, 2007.

We are not an "accelerated
 filer" for the 2007 fiscal year because it is qualified as a "small business issuer".
 Hence, under current law, the internal controls  certification and attestation
 requirements of Section 404 of the Sarbanes-Oxley act will not apply to us.
 This Annual Report on Form 10-K does not include an attestation  report of our
 registered public accounting firm  regarding  internal  control  over our  financial
 reporting.  Management's  report  was not  subject  to an  attestation  by our
registered  public  accounting  firm pursuant to the temporary rules of the Securities
 Exchange  Commission that permit us to provide only management's report in this
Annual Report on Form 10-K.

# Item 9B. Other information

We have disclosed all information
required to be disclosed in a report on Form 8-K during the fourth quarter of the year
covered by this report and subsequent to year-end.

# PART III

# Item 10. Directors and
executive officers of the Company and compliance with Section 16(a) of the Exchange Act

46

# (a) Identification of
directors and executive officers

The following table sets forth
certain information concerning our directors and executive officers (including of our
subsidiaries) as of March 31, 2007.

|                               |     |                                                          |                                 
|------------------------------ | --- | -------------------------------------------------------- | --------------------------------
|Name                           | Age | Position                                                 | Term of Office                  
|                               |     |                                                          |                                 
|Terry C. Turner 1              | 55  | Chairman of the Board of Directors, President & CEO      | 2/14/97-present                 
|                               |     |                                                          |                                 
|Alvaro Riveros                 | 65  | Director                                                 | 1/5/04-present                  
|                               |     |                                                          |                                 
|Harlan M. (Mac) DeLozier, II 2 | 64  | Director Vice President Bolivian Administration          | 9/28/06- present 3/1/97- present
|                               |     |                                                          |                                 
|Tracy A. Madsen3               | 46  | Secretary/Treasurer/CFO/Vice President US Administration | 2/13/03-present                 

(1)
          Director, President of Golden Eagle International, Inc. (Bolivia).

(2)
          Vice President of Golden Eagle International, Inc. (Bolivia).

(3)
          Mr. Madsen resigned as our Corporate Secretary/Treasurer, Vice President for
          U.S. Administration and Chief Financial Officer on August 15, 2006. On November
          14, 2006, Mr. Madsen was reappointed to the same positions that he held prior to
          his resignation.

Executive officers are elected at
annual meetings of the shareholders or are appointed by the board of directors. Each such
officer holds office for one year or until a successor has been duly appointed, elected
and qualified or until death, resignation or removal.

No arrangement exists between any of
the above officers and directors pursuant to which any one of those persons was elected to
such office or position.

Directors hold office until the next
meeting of shareholders and until a successor is elected and qualified, or until their
resignation.

# Business experience

A summary of the business experience
of each person who is currently one of our officers or directors, and such persons
service with us, is as follows:

Terry C. Turner,
Chairman of the Board of Directors, President and Chief Executive Officer. Our Board of
Directors appointed Mr. Turner to the board and as our President and Chief Executive
Officer on February 14, 1997. In 1977, Mr. Turner received a B.A. in Political Science and
a B.A. in Spanish from the University of Utah. He received his Juris Doctorate in
1980 from Brigham Young University. He is a member of the Utah State Bar Association and
admitted to practice law in the State and Federal Courts of Utah, the 10th Circuit Court
of Appeals and the United States Supreme Court. Mr. Turner is also a member of the
District of Columbia Bar, the American Bar Association, the Inter-American Bar Association
and the International Bar Association. In addition, he is a member of the Bolivian College
of Lawyers (Bolivian Bar Association) and the State Bar Association of the State
(Department) of La Paz, Bolivia, and is the first and only American attorney admitted to
practice law in Bolivia. From 1980-1983, Mr. Turner was a partner in Day, Barney and
Tycksen, Attorneys, in Salt Lake City, Utah, with practice emphasis in mining and natural
resources, international law, business, and litigation. From 1983 to 1989, Mr. Turner was
President of High Andes Mining Co., La Paz, Bolivia. From 1989 to 1991, he was General
Counsel to Panworld Minerals International, Inc., a public company with mineral prospects
in South America. From 1991 to 1993, Mr. Turner was General Counsel to Tipuani Development
Company, S.A., La Paz, Bolivia a gold dredging company. From 1993 to 1995, he was Vice
President and General Counsel to Minas del Glaciar, S.A., La Paz, Bolivia, which was a
mineral exploration company. From 1995 to 1997, Mr. Turner was in private practice in La
Paz, Bolivia. From 1995 to November 2002, when he resigned those positions, Mr. Turner
served as President and a Director of Bolivian Copper Chemical Company, S.A., a private
Bolivian copper exploration and mining company located in La Paz, Bolivia. During the
entire period of 1983 through 1997, Mr. Turner was affiliated with and of
counsel to Cordero and Cordero, a La Paz, Bolivia law firm, dealing with mining and
international law. From January 1996, until his appointment with us in February 1997, Mr.
Turner was our corporate counsel in Bolivia. Mr. Turner was awarded the Medal of Civic
Merit by the Prefect (Governor) of the State of La Paz, Bolivia, during 1997 for his work
in promoting investment in the Bolivian mining industry, and for his contribution to the
progress within the La Paz state. The Medal of Civic Merit is the highest honor that can
be awarded by the state government in Bolivia. Mr. Turner was also named by the National
Register to its Whos Who of international attorneys and mining executives for 2003.

47

Alvaro Riveros,Director,was appointed as a member of our Board of Directors on January 5,
2004. Mr. Riveros received a Masters Degree in Electromechanical Engineering from
the Werner Siemens School of Engineering in Stuttgart, Germany. He is a registered
engineer in Bolivia whose firm, EDICOM, carried out the electromechanical engineering,
design and installation for our Cangalli gold recovery plant and mine. EDICOM specializes
in electromechanical engineering, design and installation work in mines, mineral recovery
plants and smelters in Bolivia, and Mr. Riveros was its president from 2002 to his
appointment on our board. Prior to that time, Mr. Riveros was appointed Vice Minister of
Industry and Commerce in the Ministry of Economic Development from 2000 to 2002. He was
appointed Vice Minister of Natural Resources in the Ministry of Agriculture from 1998 to
2000. From 1997 to 1998, he served as Vice Minister of Planning in the Ministry of
Sustainable Development and the Environment. From 1989 through 1997, Mr. Riveros was
president of Ximena Gold Mines, Ltd., a gold mining company with hard rock mines at the
headwaters of the Tipuani River in Bolivia. Earlier in his career, he had previously
served as EDICOMs president from 1978 to 1988. He was appointed Special Technical
Advisor to the President of Venezuela from 1975 to 1978. From 1972 through 1975, he served
as Director of Industrial Safety for the Ministry of Labor in Bolivia. Mr. Riveros also
worked for Siemens as a project engineer in Venezuela and supervised large industrial
projects in Brazil and Bolivia between 1965 and 1972.

Harlan M. (Mac) DeLozier II,
Director,was appointed to the position of our Administrative Vice
President for Bolivian Administration on March 1, 1997. Mr. Delozier is a 1966 graduate of
Oklahoma State University, where he received B.A. degrees in Political Science, Foreign
Language and History. He served in the Peace Corps in Bolivia from 1966-1971 and was a
cattle rancher in Beni, Bolivia from 1972-1990. From 1976 to 1980 he was a representative
of Homeline/Textron in Bolivia, and from 1980-1981 was manager of gold mining operations
for Kerani, in the Murillo Province, La Paz, Bolivia. From 1981 to 1985, Mr. Delozier was
the purchasing agent for the U.S. Embassy Commissary in La Paz, Bolivia and was an
exporter for leather products to Chile and Peru from 1986-1988. From 1989 until 1997, Mr.
Delozier was an international sales representative for Toyota, Chevrolet, and Hyundai in
Bolivia. From May 1997 to November 2002, when he resigned his position, Mr. Delozier also
served as Executive Vice President of Bolivian Copper Chemical Company, S.A., a Bolivian
copper exploration and mining company located in La Paz, Bolivia.

48

Tracy A. Madsenwas appointed as Corporate Secretary/Treasurer and Chief Financial Officer
(CFO) on February 13, 2003. On November 12, 2003 he was also appointed Vice President US
Administration. Mr. Madsen received a B.A. in Finance from Boise State University, and an
MBA from the University of Nevada Las Vegas. Mr. Madsen has broad financial and executive
experience. From 1987 to 1990, he worked as a branch manager for First Interstate Bank of
Nevada. In 1990, and through 1996, Mr. Madsen became Vice President and CFO of Venada
Aviation, Inc. During that same period, Mr. Madsen served as President and Chairman of the
Board of three subsidiaries of Venada: Arena Aviation, Inc., Lancelot Leasing, Inc. and
Camelot Aviation Corporation. From 1996 to 2002, Mr. Madsen served as the CFO of a group
of five aviation-related corporations: Tracer Corporation; Trace Air International, Inc.;
Trade Air.com, Inc. and Tracer Aviation Services Canada. He was also an officer and a
partner of Miami Holdings, Inc. a commercial aircraft wheel and brake overhaul facility.

# (b) Identification of
significant employees

We have no significant employees
other than the officers named above.

# (c) Family relationships

No family relationships exist among
the officers and directors.

# (d) Involvement in
certain legal proceedings

None of our executive officers or
directors has been involved in or is subject to any of the following legal proceedings:

(1)
          A petition under the Federal bankruptcy laws or any state insolvency law that
          was filed by or against, or a receiver, fiscal agent or similar officer was
          appointed by a court for the business or property of such person, or any
          partnership in which he was a general partner at or within two years before the
          time of such filing, or any corporation or business association of which he was
          an executive officer at or within two years before the time of such filing;

(2)
          No such person was convicted in a criminal proceeding or is a named subject of a
          pending criminal proceeding (excluding traffic violations and other minor
          offenses);

(3)
          No such person was the subject of any order, judgment, or decree, not
          subsequently reversed, suspended or vacated, of any court of competent
          jurisdiction, permanently or temporarily enjoining him from, or otherwise
          limiting, the following activities: Acting as a futures commission merchant,
          introducing broker, commodity trading advisor, commodity pool operator, floor
          broker, leverage transaction merchant, any other person regulated by the
          Commodity Futures Trading Commission, or an associated person of any of the
          foregoing, or as an investment adviser, underwriter, broker or dealer in
          securities, or as an affiliated person, director or employee of any investment
          company, bank, savings and loan association or insurance company, or engaging in
          or continuing any conduct or practice in connection with such activity; engaging
          in any type of business practice; or engaging in any activity in any activity in
          connection with the purchase or sale of any security or commodity or in
          connection with any violation of Federal or State securities laws or Federal
          commodities laws;

49

(4)
          No such person was the subject of any order, judgment or decree, not
          subsequently reversed, suspended or vacated, of any Federal or State authority
          barring, suspending or otherwise limiting for more than 60 days the right of
          such person to engage in any activity described in paragraph (f)(3)(i) of this
          section, or to be associated with persons engaged in any such activity; or

(5)
          No such person was found by a court of competent jurisdiction in a civil action
          or by the Commission to have violated any Federal or State securities law, and
          the judgment in such civil action or finding by the Commission has not been
          subsequently reversed, suspended, or vacated.

(6)
          No such person was found by a court of competent jurisdiction in a civil action
          or by the Commodity Futures Trading Commission to have violated any Federal
          commodities law, and the judgment in such civil action or finding by the
          Commodity Futures Trading Commission has not been subsequently reversed,
          suspended or vacated.

# Corporate Governance:

# (a) Director Independence

See our disclosure at page 60 under
Item 13.

(b) Committees We do not have audit,
nominating, or compensation committees or committees performing similar functions nor a
written nominating, compensation of audit committee charter. Our Board of Directors as a
whole decides such matters, including those that would be performed by a standing
nominating committee. Our Board of Directors has not adopted any processes or procedures
for considering executive and director compensation. We have not yet adopted an audit,
compensation, or nominating committees because we have not sufficiently developed our
operations and have generated no revenues during the past three years. Additionally, we
do not currently have any specific or minimum criteria for the election of nominees to
our Board of Directors nor do we have any process or procedure for evaluating such
nominees.

(c) Shareholder Communications Our
Board of Directors does not have any defined policy or procedure requirements for our
stockholders to send communications to our Board of Directors, including submission of
recommendations for nominating directors. We have not yet adopted a process for our
security holders to communicate with our Board of Directors because we have not
sufficiently developed our operations and corporate governance structure.

50

(d) Board of Director Meetings.
During fiscal year 2007, our Board of Directors met by telephone as permitted by our
By-laws on the following dates: (a) January 28, 2007; (b) January 29, 2007; (c) January
31, 2007; (d) February 2, 2007; (e) February 6, 2007; (f) February 12, 2007; (g) March
27, 2007; (h) March 28, 2008; (i) March 30, 2007; (ji) April 11, 2007; (k) May 27, 2007; (l)
June 27, 2007; (m) August 15, 2007; (n) August 17, 2007; (o) October 30, 2007; and (p)
December 20, 2007. Our Board of Directors met in person in Santa Cruz, Bolivia on
September 3, 2007. We request that all of our Directors attend our Board of Director
meetings; however, we have no formal policy regarding their attendance.

(e) Annual Shareholder Meetings On
September 14, 2007, we had our 2007 Annual Meeting of Shareholders. Our Chairman of the
Board, Terry Turner attended the meeting. We have no formal policy attendance of our
officers or directors regarding their attendance at an Annual Meeting of our
Shareholders.

(f) Code of ethicsWe adopted a Code
of Ethics on March 23, 2004, that applies to our principal executive officer, principal
financial officer, principal accounting officer or controlling persons, or persons
performing similar functions. A copy of the Code was included as an exhibit to this
annual report for the period ending December 31, 2003. In addition, our Code of Ethics is
available on our web site at www.geii.com under the caption Investor
Relations: Code of Ethics. A copy of our Code of Ethics is available to any person,
without charge, by faxing a request to our Chief Financial Officer at our corporate
offices at (801)619-1747.

The Code has not been amended since
the filing.

# Section 16(a) beneficial
ownership reporting compliance

Section 16(a) of the Securities
Exchange Act of 1934, as amended (the Exchange Act), requires our officers and
directors, and persons who own more than 10% of a registered class of our equity
securities, to file reports of ownership and changes in ownership of our equity securities
with the Securities and Exchange Commission. Officers, directors and
greater-than-ten-percent shareholders are required by Securities and Exchange Commission
regulations to furnish us with copies of all Section 16(a) filings.

Based solely on our review of Forms
3, 4 and 5 available to us and, where applicable, written representations from directors,
officers and 10% stockholders that no form is required to be filed, we believe that no
director, officer or beneficial owner of more than 10% of its common stock failed to file
on a timely basis reports required pursuant to Section 16(a) of the Exchange Act with
respect to fiscal year ended December 31, 2007, with the exception of one late filing of a
Form 4 by Golden Eagle Mineral Holding, Inc. that was filed on April 15, 2008.

51

# Item 11. Executive
compensation

# (a) and (b) Summary
compensation table

The following table sets forth
information regarding compensation paid to our Executive Officers which received in excess
of $100,000 in compensation for the years ended December 31, 2005, 2006 and 2007. No other
person who currently one of our executive officers, earned salary and bonus compensation
exceeding $100,000 during any of the last three years. The table below includes all
compensation paid to them during the years stated.

|                               |      |                     |             |                  |                                      |                       
|------------------------------ | ---- | ------------------- | ----------- | ---------------- | ------------------------------------ | ----------------------
|                              
|                               |      |                     |             |                  |                                      |                       
|Long Term Compensation        
|                              
|                               |      | Annual Compensation | Awards     
|Name & Title                   | Year | Salary              | Bonus       | Restricted Stock | Securities Underlying Options & SARS | All other compensation
|Terry C. Turner               
|CEO, President, Chairman      
|                               | 2005 | $120,083(A)         | $60,000 (B) |                  |                                      |                       
|                               | 2006 | $176,152(A)         | $60,000 (B) |                  |                                      |                       
|                               | 2007 | $187,514(A)         | $60,000 (B) |                  |                                      |                       
|Tracy A. Madsen               
|CFO, VP, Secretary & Treasurer
|                               | 2005 | $74,167(C)          |             | $25,000 (D)      |                                      | -                     
|                               | 2006 | $77,499(C)          |             | $22,612 (D)      |                                      | $22,755 (E)           
|                               | 2007 | $98,718(C)          |             |                  |                                      | $50,000 (F)           
|Harlan M. (Mac) DeLozier      
|Director/VP                   
|                               | 2005 | $91,000(G)          |            
|                               | 2006 | $91,000(G)          |            
|                               | 2007 | $99,101(G)          |             |                  |                                      | $50,000 (H)           

(A)
          During June 2005, Mr. Turner voluntarily reduced his annual salary by 40% to
          $150,000 per year not including the cashless bonus described in footnote (B).
          Additionally, Mr. Turner deferred $53,667 of 2005 salary to be paid when
          sufficient funds were available. During 2006, Mr. Turner received his annual
          compensation of $150,000 plus $26,152 in accrued salary that was owed to him
          from 2005. As of December 31, 2006 Mr. Turner was owed $27,514 in accrued
          salary. Effective January 1, 2008 Mr. Turners salary was increased to
          $180,000 per year. During 2007 Mr. Turner received his regular salary amount
          plus $27,514 in accrued salary from 2006.

52

(B)
          These bonus payments reflect non-cash debt forgiveness. At December 31, 2007,
          Mr. Turner owed us $276,783 in non-interest bearing loans he received from us
          prior to July 31, 2002; we also owed Mr. Turner $276,783 on a non-interest
          bearing basis as a result of salaries that accrued without payment during 1997
          through 2001 (in excess of the $443,772 that Mr. Turner waived on December 31,
          2001). During 2005, 2006 and 2007, Mr. Turner waived $60,000 of unpaid accrued
          salary each year. The board of directors has approved this arrangement on our
          behalf. There has been no material modification of the terms of either
          indebtedness since the enactment of Section 402 of the Sarbanes-Oxley Act of
          2002.

(C)
          During 2005 and 2006, Mr. Madsens annual salary was $91,000. During 2005, he
          deferred $16,833 of accrued salary to be paid when sufficient funds were
          available. During 2006, $9,249 of accrued salary was paid to him. As of December
          31, 2006, 7,584 in accrued salary was owed to him. Effective January 1, 2008, Mr.
          Madsens salary was increased to $110,000 annually. During 2007 Mr. Madsen
          received his regular salary plus the $7,584 in accrued salary owed to him from
          2006.

(D)
          On March 30, 2005, Mr. Madsen was granted 965,251 shares of restricted common
          stock in accordance with his employment agreement in lieu of a cash payment for
          services provided during 2004. Shares were valued at $.0258 per share based on
          the closing price on the date of the grant. On August 11, 2006, he was granted
          1,726,092 shares of S-8 common stock in accordance with his employment agreement
          in lieu of a cash payment for services provided during 2005. Shares were valued
          at $.0131 per share based on the closing price of the stock on the date of the
          grant.

(E)
          Mr. Madsen resigned as an officer on August 15, 2006 and was reappointed as an
          officer on November 14, 2006. During this period of time, we contracted with a
          company controlled by Mr. Madsen to provide accounting and administrative
          support. Total fees paid to Avcon services during 2006 were $22,755.

(F)
          On April 11, 2007, we entered into a convertible promissory note with Mr. Madsen
          with effective date of February 6, 2007. The note covered the payment of
          contractual retention bonuses payable in our common shares. This note was for
          $50,000, and has a term of 2 years, and is convertible into shares of our common
          stock at the closing price for our common stock on February 6, 2007, which was
          $.009. As of the date of this report, this note has not been converted to common
          stock and is still outstanding.

(G)
          During 2005 and 2006, Mr. DeLoziers annual salary was $91,000. Effective on
          January 1, 2008, Mr. DeLoziers salary was increased to $110,000 annually.

(H)
          On April 11, 2007, we entered into a convertible promissory note with Mr.
          DeLozier with effective date of February 6, 2007. The note covered the payment
          of contractual retention bonuses for 2005 and 2006 payable in our common shares.
          This note was for $50,000, and had a term of 2 years, and is convertible into
          shares of our common stock at the closing price for our common stock on February
          6, 2007, which was $.009. On February 4, 2008, Mr. DeLozier converted his note
          payable into 5,947,564 shares of common stock for the $50,000 note payable and
          accrued interest. Mr. DeLozier is still owed a contractual stock bonus of
          $25,000 for 2006

53

We have no plans that result in the
payment or accrual for payment of any amounts to any executive officer in connection with
his or her resignation, retirement, or other termination, or change of control or change
in the executive officers responsibilities.

(c)    
          Options/SAR granted during year ended December 31, 2007

None

(d)    
          Aggregated option/SAR exercises and fiscal year-end option/SAR value table

None

(e)    
          Long term incentive plan  awards in last fiscal year

We have no long-term incentive plans.

# (f) Defined benefit or actuarial
plan disclosure

We have pay medical insurance
premiums for our employees. We currently have no stock ownership or other profit sharing,
defined benefit, actuarial, or pension plans, nor life insurance or any other benefit plan
for our employees, but may adopt such plans in the future. We have no retirement plans
and, therefore, have made no contributions to any such plan on behalf of the named
officers.

# (g) Compensation of
directors

We currently have three directors on
our Board of Directors. Directors fees were suspended in approximately June 2004 as
a result of the shutdown of our production operations at our Cangalli prospect.

Alvaro Riveros received fees of
$11,000 during 2007 reflecting additional services he provided to us as a consultant in
Bolivia.

Terry C. Turner is our president and
CEO and receives a salary for such duties as discussed above, but received no additional
compensation as a director.

Harlan M. (Mac) DeLozier is our Vice
President for Bolivian Administration and receives salary for his duties and does not
receive additional compensation as a director.

54

Except as described herein, none of
our officers or directors has been or is being paid any cash compensation, or is otherwise
subject to any deferred compensation plan, bonus plan or any other arrangement and
understanding whereby such person would obtain any cash compensation for his services for
and on our behalf.

# (h)    Employment
contracts and termination of employment and change-in-control           arrangements

We have an employment contract with
Tracy Madsen, our Chief Financial Officer and Vice President for US Administration,
requiring us to issue him a bonus of $25,000 in our restricted common stock for each year
of his employment which becomes due in February of the year after it is earned by
remaining employed by us.

We have an employment contract with
Harlan M. (Mac) DeLozier, a director and our Vice President for Bolivian Operations,
requiring us to issue him a bonus of $25,000 in our restricted common stock for each year
of his employment which becomes due in February of the year after it is earned by
remaining employed by us.

We have no other compensatory plan or
arrangement with respect to any executive officer which plan or arrangement results or
will result from the resignation, retirement or any other termination of such
individuals employment with us, or from a change in control of us or a change in the
individuals responsibilities following a change in control.

# (i) Report on repricing
of options/SARs

Not applicable, as no options or SARs
were repriced during the fiscal year ended December 31, 2007 or subsequently.

# (j)    Additional
information with respect to compensation committee interlocks and           insider
participation on compensation decisions

We do not currently have a
compensation committee.

(k)    
          Board compensation committee report on executive compensation

We do not currently have a
compensation committee and no compensation committee report on executive compensation was
issued during 2007.

# Item 12. Security
ownership of certain beneficial owners and management and related stockholder matters

# (a) and
(b)Security ownership of certain beneficial owners and management

At December 31, 2007, and
subsequently, we had only two classes of outstanding voting securities, our common stock
(referred to herein as the Common Stock) and Series B Preferred Stock which is
convertible into restricted common shares if and when common shares are available. Series
B preferred shares have voting rights equivalent of the number of common shares into which
the preferred shares may at some point be converted.

55

The following tables set forth
information regarding the ownership of our outstanding common stock as of the filing of
this report by: (a) each person known by management to own, beneficially or of record,
more than five percent (5%) of our common stock; (b) each director; (c) each executive
officer named in the Compensation Table set forth later in this report; and (d) all of our
directors and executive officers as a group.

The following tables assume, based on
our stock records, that there are 1,872,401,108 shares of our common stock, $.0001 par
value, currently issued and outstanding, and 125,002 Series B Preferred Shares, $.01 par
value, issued and outstanding plus 10,000,000 shares of our common stock reserved for the
conversion of an outstanding debenture and 13,063,164 for two convertible notes payable
which are included in the fully diluted share total but have no voting rights.. The
Holders of the Series B Shares presently have the right to vote two hundred fifty (250)
common shares for every one (1) Series B share held on all matters presented to the common
stockholders. The Series B Holders are not required to convert their Series B shares into
common stock prior to voting at any meeting of the shareholders or on any matter presented
to the common shareholders. As indicated above, as of the filing of this report there are
125,002 Series B shares outstanding, which will result in 31,250,500 votes by the Series B
Holders or 1.8 percent of the total shares of all classes entitled to vote on all matters
presented to the common stockholders at any meeting. Additionally 32,037,523 shares have
been committed to individuals and entities in convertible notes payable and common shares
payable. As such, an aggregate of 1,935,689,131 shares are included in the fully diluted
share number as of the date of this report.

# SECURITY OWNERSHIP OF
BENEFICIAL OWNER

|                                                                             |                                          |                                             |                                                                          
|---------------------------------------------------------------------------- | ---------------------------------------- | ------------------------------------------- | -------------------------------------------------------------------------
|Name and Address ofBeneficial Owner                                          | Shares of Common StockBeneficially Owned | Percent of UndilutedCommon StockOutstanding | Percent ofFully Diluted Common Stock(After Conversion ofPreferred Shares)
|                                                                            
|Golden Eagle Mineral Holdings, Inc.(1)910 Golden Beach Blvd.Venice, FL 34285 | 498,996,250                              | 26.65%                                      | 25.78%                                                                   
|                                                                             |                                          |                                             |                                                                          
|Kevin Pfeffer (2)5307 Aerie Ct.Clarksville, MD, 21029                        | 169,408,726                              | 9.05%                                       | 8.75%                                                                    
|                                                                             |                                          |                                             |                                                                          
|Dewey L. Williams (3)6860 N. Dallas Pkwy, Suite 200Plano, TX 75024           | 106,191,750                              | 5.67%                                       | 5.49%                                                                    
|                                                                             |                                          |                                             |                                                                          
|Lone Star Equity Group LLC (4)6222 Richmond Ave,Suite 540Houston, TX 77057   | 105,662,500                              | 5.64%                                       | 5.46%                                                                    
|                                                                             |                                          |                                             |                                                                          
|Total                                                                        | 880,259,226                              | 47.01%                                      | 45.48%                                                                   
|                                                                            

56

(1)
          Golden Eagle Mineral Holdings, Inc. converted 1,995,985 Series B Preferred
          shares into 498,996,250 common restricted shares on December 17, 2007. Golden
          Eagle Mineral Holdings Inc. is not affiliated with Golden Eagle International
          Inc. other than its greater than 10% ownership share in Golden Eagle
          International Inc. common stock.

(2)
          Kevin Pfeffer resigned as our Director on December 4, 2006. Mr. Pfeffer also
          received 57,608,593 shares of our common stock as settlement for $230,434 in
          outstanding debt, expenses that he had accrued as a director and penalties on
          January 25, 2008.

(3)
          Dewey Williams, The Dewey Williams Profit Sharing Plan & Trust and The Dewey
          Williams Roth IRA, converted 110,200 Series B Preferred shares into 27,550,000
          common restricted shares on December 17, 2007. Mr. Williams through the three
          entities listed above also purchased 17,656,250 shares of our restricted common
          stock during the first three months of 2008 through a private placement.

(4)
          Lone Star Equity Group, LLC, converted 422,650 Series B Preferred shares into
          105,662,500 common restricted shares on December 17, 2007.

The following table sets forth
information as of the date of this filing, with respect to the ownership of our common
stock for all directors, individually; all executive officers named in the compensation
table; all executive officers and directors as a group.

# SECURITY OWNERSHIP OF
MANAGEMENT

|                                                                                                       |                                          |                                             |                                     
|------------------------------------------------------------------------------------------------------ | ---------------------------------------- | ------------------------------------------- | ------------------------------------
|Name and Address ofDirector or Executive Officer                                                       | Shares of Common StockBeneficially Owned | Percent of UndilutedCommon StockOutstanding | Percent ofFully Diluted Common Stock
|                                                                                                      
|Terry C. TurnerChief Executive Officer/President/Chairman9661 South 700 EastSalt Lake City, Utah 84070 | -                                        | -                                           | -                                   
|                                                                                                       |                                          |                                             |                                     
|Harlan M. (Mac) DeLozierDirector/VP (1)9661 South 700 EastSalt Lake City, Utah 84070                   | 5,997,564                                | 0.03%                                       | 0.03%                               
|                                                                                                       |                                          |                                             |                                     
|Tracy A. Madsen (2)CFO/VP9661 S 700 ESandy, UT 84070                                                   | 5,128,720                                | 0.03%                                       | 0.06%                               
|                                                                                                       |                                          |                                             |                                     
|Alvaro RiverosDirector9661 South 700 EastSalt Lake City, Utah 84070                                    | -                                        | -                                           | -                                   
|                                                                                                       |                                          |                                             |                                     
|Officers and Directors as a Group                                                                      | 11,126,284                               | 0.06%                                       | 0.09%                               
|                                                                                                      

57

| | (1) | Mr.
DeLozier received a convertible note payable representing 5,555,556 shares
               on February 6, 2007 as consideration for our contractual obligation to pay
him                $25,000 per year in stock representing two years. On February 4, 2008,
Mr.                Delozier converted this note into 5,997,564 which was the principal
amount of                the note and accrued interest. This total is included in all
categories of the                chart above.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | Mr.
Madsen received 3,205,128 restricted shares on March 31, 2008 as part of his
               employment agreement for 2007. Mr. Madsen also holds a convertible note
payable                representing 5,555,556 shares on February 6, 2007 as consideration
for our                contractual obligation to pay him $25,000 per year in stock plus a
$25,000                bonus. As of the date of this report, Mr. Madsen had not converted
this note to                common stock and these shares are not included Shares of
Common Stock                Beneficially Owned number or the Percent of Undiluted Common
Stock Outstanding                calculation listed above. These shares however, are
included in the Percent of                Fully Diluted Common Stock calculation listed
above. Total shares owned by Mr.                Madsen or to which Mr. Madsen has a right
to convert his note into as of the                date of this report are 10,684,276.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

As used in this section, the term
beneficial ownership with respect to a security is defined by Rule 13d-3 under the
Securities Exchange Act of 1934 as consisting of sole or shared voting power (including
the power to vote or direct the vote) and/or sole or shared investment power (including
the power to dispose or direct the disposition) with respect to the security through any
contract, arrangement, understanding, relationship or otherwise.

# (c) Changes in control

The holders of our Contingent
Convertible Series B Preferred shares were entitled to 250 votes for each preferred share.
If and when all Series B preferred shares are converted into common stock, the Series B
preferred shareholders as a group will control 48.67% of our common stock. As of the date
of this report, 96.48% or 3,431,002 shares of our Contingent Convertible Series B
Preferred shares have been converted into 857,750,500 common shares leaving 125,002
Contingent Convertible Series B Preferred shares convertible into 31,250,500 common
shares..

# (d)    Securities
authorized for issuance under equity compensation plans

See
Item 5 above for this disclosure.

# Item 13. Certain
relationships and Related Transactions, and Director Independence

58

# (a) Indebtedness

Accrued Compensation.During 1997 through 2001, we did not have the funds to pay salaries to our
president, Terry C. Turner. As a result, his salary accrued unpaid through a portion of
2002 when we paid only $103,000 of the $200,000 owed to him during that year.

On December 31, 2001, Mr. Turner
waived $443,772 of a total accrued balance of $990,012 owed to him. During 2002 and 2003,
Mr. Turner waived an additional$60,000 and $36,457 respectively. During 2004, 2005, 2006
and 2007 Mr. Turner waived an additional $60,000 each year respectively of the amount owed
to him. As of December 31, 2007 the total sum that we owed Mr. Turner was $276,783 in
accrued compensation. Our indebtedness to Mr. Turner is non-interest bearing.

Advances to Mr.
Turner. Because we were unable to pay him full salaries from 1997 through
the first part of 2002, we assisted Mr. Turner with certain financial obligations and
accounted for those payments as loans to him. At July 31, 2002 the total amount due to us
from Mr. Turner was $579,021 on a non-interest bearing basis, and no further amounts have
been advanced to him since that time, including since the enactment of Section 402 of the
Sarbanes-Oxley Act of 2002 that prohibits personal loans to executives or any material
modification thereof. There have been no material modifications in the terms of that loan
since that date.

Repayment of Loan and Accrued
Compensation. The Board of Directors determined that Mr. Turner would
receive a $60,000 per year non-cash bonus that is used to pay down notes he owes to us.
All repayments are made with after tax dollars. Mr. Turner in turn forgives the portion of
the accrued salary that we owe to him in order to keep the note payable and the note
receivable in balance. These reductions have occurred in 2006 and 2007 and are expected to
continue until both the advances to Mr. Turner and the unpaid salary are reduced to zero.
As of December 31, 2006 the total amount owed by Mr. Turner was $276,783 and equaled the
amount that we owed to him. For purposes of the consolidated financial statements this
note payable and note receivable are netted out to $0.

Current Deferred Compensation.
As of December 31, 2007, we owed the following officers accrued compensation.

|                              |                           |        
|----------------------------- | ------------------------- | -------
|Officer Deferred Compensation | Position                  | Amount 
|                              |                           |        
|Harlan M. (Mac) DeLozier      | VP Bolivia Administration | $20,139

# (b) Loans to Golden
Eagle from affiliates

In addition, as described elsewhere
in this report, our officers have advanced funds to us for operations in Bolivia and to
cover overhead in the US.

59

|     |                       |             |             |                                
|---- | --------------------- | ----------- | ----------- | -------------------------------
|     |                       |             |             |                                
|Date | Affiliated Lender     | Loan Amount | (Repayment) | Outstanding Balance at Year end
|     |                       |             |             |                                
|2007 | Terry Turner          | $245        | $(345)      | $-                             
|     | Harlan (Mac) DeLozier | 11,350      | (14,300)    | 11,350                         
|     | Tracy Madsen          | 121,000     | (52,500)    | 71,000                         
|     | Marco Venegas         | 10,000      | -           | 10,000                         
|     |                       |             |             |                                
|     | Total                 | $142,595    | $(67,145)   | $92,350                        
|     |                       |             |             |                                
|2006 | Kevin Pfeffer(A)      | -           | -           | $135,000                       
|     | Terry Turner          | 9,100       | (9,000)     | 100                            
|     | Harlan (Mac) DeLozier | 14,300      | -           | 14,300                         
|     | Tracy Madsen          | 12,000      | (9,500)     | 2,500                          
|     |                       |             |             |                                
|     | Total                 | $35,400     | $(9,500)    | $151,900                       

| | (A) | Mr. Pfeffer resigned from the Board of Directors on December 4, 2006. Mr.
               Pfeffer also no longer owns more than 10% of our outstanding stock and as such
               is no longer considered an affiliate. The $135,000 debt owed to Mr. Pfeffer was
               converted to common stock and discharged in a settlement agreement dated January
               25, 2008 and the outstanding debt as of the date of this report is $0.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Director Independence

Our common stock is quoted on the OTC
Bulletin Board; that trading medium does not have director independence requirements.
Under Item 407(a) of Regulation S-K, we have adopted the definition of independence used
by the American Stock Exchange, which may be found in the American Stock Exchange Company
guide at (s) 121(A)(2) (2007). Under this definition, none of our directors are
independent, because our Board of Directors cannot affirmatively determine that any of our
directors do not have a relationship that would interfere with the exercise of independent
judgment in carrying out their responsibilities of a director.

# Item 14. Principal
accountants fees and services

Our Board of Directors selected the
independent accounting firm of Chisholm, Bierwolf & Nilson, LLC, Certified Public
Accountants, with respect to the audit of our consolidated financial statements for the
years ended December 31, 2007 and 2006. Our Bolivian Subsidiaries were audited by Pozo
& Asociados S.R.L. an independent member of Baker Tilly International.

Audit Fees. In connection with
professional services rendered for the audit of our annual financial statements reported
under Form 10-K for the year ended December 31, 2006 and the reviews of the first, second
and third quarters 2006 financial statements included in our quarterly reports filed
on Form 10-Q for that year, Chisholm Bierwolf & Nilson billed us fees in the aggregate
amount of approximately $31,496. Total fees paid to Chisholm, Bierwolf & Nilson for
the review of the quarterly financial statements included in reports filed under Form 10-Q
for 2006 and for the audit of the 2006 financial statements reported under Form 10-KSB
were $31,496. Total fees paid to Chisholm, Bierwolf & Nilson for the review of the
quarterly financial statements included in reports filed under Form 10-Q for 2007 and for
the audit of the 2007 financial statements reported under Form 10-KSB are estimated to be
approximately $35,000. In connection with professional services rendered for the audit of
our annual financial statements reported under Form 10-K for the year ended December 31,
2006 and the reviews of the 2006 quarterly financial statements included in our quarterly
reports filed on Form 10-Q for that year, Pozo & Asociados S.R.L. billed us fees in
the aggregate amount of approximately $10,800. Total fees paid to Pozo & Asociados
S.R.L. for the review of the quarterly financial statements included in reports filed
under Form 10-Q for 2006 and for the audit of the 2007 financial statements reported under
Form 10-K are estimated to be approximately $11,000.

60

Audit Related Fees. There were
no fees billed in each of the last two fiscal years (ended December 31, 2006 and 2005) for
assurance and related services by the principal accountant that are reasonably related to
the performance of the audit or review of our financial statements that are not reported
under Audit Fees.

Financial Information Systems
Design and Implementation Fees. We did not pay any fees to Chisholm, Bierwolf &
Nilson or Pozo & Asociados S.R.L. for professional services rendered for financial
information systems design and implementation as that term is defined in Rule
2-01(c)(4)(ii) of Regulation S-X.

Tax Fees. The aggregate fees
billed in 2005 for professional services rendered by RSG Accounting Services for tax
compliance, tax advice, and tax planning were approximately $6,250. The nature of the
services for which these fees were received was preparation of tax returns. We estimate
the fees to be charged By RSG Accounting Services for the preparation of our 2006 tax
returns to be approximately $6,000 and our 2007 tax returns to be approximately $6,500.

All Other Fees. During the
fiscal years ended December 31, 2007 and 2006, there were no other fees paid Chisholm,
Bierwolf & Nilson or Pozo & Asociados S.R.L. for any other auditing or accounting
services.

Total Fees.

| | The
total estimated fees charged for all services by Chisholm, Bierwolf & Nilson:
| | ---------------------------------------------------------------------------------

| | During
the fiscal year ended December 31, 2007:               $35,541          During the fiscal
year ended December 31, 2006:               $31,496
| | ----------------------------------------------------------------------------------------------------------------------------------------------------

| | The
total fees charged for all services by Pozo & Asociados S.R.L.:
| | -------------------------------------------------------------------

| | During
the fiscal year ended December 31, 2007:               $11,000          During the fiscal
year ended December 31, 2006:               $10,800
| | ----------------------------------------------------------------------------------------------------------------------------------------------------

61

Our Board of Directors has considered
the information described in Financial Information Systems Design and
Implementation Fees and All Other Fees above and believes
that it is compatible with maintaining the principal accountants independence. In
each case (commencing after August 1, 2002), the board of directors pre-approved all such
services.

Our principal accountant (through its
full time employees) performed all work regarding the audit of our financial statements
for the most recent two fiscal years.

# PART IV

# Item 15. Exhibits and
financial statement schedules

# (a) Financial statements

|                                                                                                       |                 
|------------------------------------------------------------------------------------------------------ | ----------------
|The following documents are filed as part of this report:                                              | Page            
|                                                                                                       |                 
|Independent Auditors Report                                                                            | F-1 & F-2       
|                                                                                                       |                 
|Consolidated Balance Sheets as of December 31, 2007 and 2006                                           | F-3             
|                                                                                                       |                 
|Consolidated Statements of Operations for the years endedDecember 31, 2007 and 2006                    | F-4             
|                                                                                                       |                 
|Consolidated Statements of Cash Flows for the years endedDecember 31, 2007 and 2006                    | F-5             
|                                                                                                       |                 
|Consolidated Statement of Stockholders' Equity (Deficit) forthe years ended December 31, 2007 and 2006 | F-6             
|                                                                                                       |                 
|Notes to Consolidated Financial Statements                                                             | F-7 through F-24

# (b) Exhibits

The following exhibits are filed with
this Form 10-KSB or incorporated herein by the following references:

62

|      |                                                                                                                                                                                                                                                                  
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1   | Articles of Incorporation, as amended, incorporated by reference.                                                                                                                                                                                                
|3.2   | Bylaws, incorporated by reference.                                                                                                                                                                                                                               
|4.1   | Certificate of Designation for the Series B Convertible Preferred Stock, incorporated by reference.                                                                                                                                                              
|10.1  | Series B Convertible Preferred Stock Subscription Agreements, incorporated by reference.                                                                                                                                                                         
|14.1  | Code of Ethics, incorporated by reference.                                                                                                                                                                                                                       
|21.1  | Golden Eagle Bolivia Mining S.A., incorporated under the laws of Bolivia; Eagle Mining of Bolivia, Ltd.,incorporated under the laws of Bolivia; Golden Eagle International, Inc. (Bolivia), incorporated under thelaws of Bolivia, all incorporated by reference.
|31.1  | Certification by the Principal Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)                                                                                                                                                                            
|31.2  | Certification by the Principal Financial Officer pursuant to Rule 13a-14(a)/15d-14(a)                                                                                                                                                                            
|32.1  | Certification by the Principal Executive Officer pursuant to Section 1350                                                                                                                                                                                        
|32.2  | Certification by the Principal Financial Officer pursuant to Section 1350                                                                                                                                                                                        
|99.1  | Incorporated by reference from our registration statement on Form 10-SB that became effective June 17, 1994.                                                                                                                                                     
|99.2  | Proxy statement, definitive 14A dated August 6, 2007, filed with the SEC on August 6, 2007 (incorporated by reference)                                                                                                                                           
|99.3  | Incorporated by reference from our Form 8-K reporting an event of February 7, 2008                                                                                                                                                                               
|99.4  | Incorporated by reference from our Form 8-K reporting an event of December 31, 2007                                                                                                                                                                              
|99.5  | Incorporated by reference from our Form 8-K reporting an event of September 20, 2007                                                                                                                                                                             
|99.6  | Incorporated by reference from our Form 8-K reporting an event of July 5, 2007                                                                                                                                                                                   
|99.7  | Incorporated by reference from our Form 8-K reporting an event of June 27, 2007                                                                                                                                                                                  
|99.8  | Incorporated by reference from our Form 8-K reporting an event of June 4, 2007                                                                                                                                                                                   
|99.9  | Incorporated by reference from our Form 8-K reporting an event of May 10, 2007                                                                                                                                                                                   
|99.10 | Incorporated by reference from our Form 8-KA reporting an event of March 9, 2007.                                                                                                                                                                                
|99.11 | Incorporated by reference from our Form 8-K reporting an event of February 14, 2007.                                                                                                                                                                             
|99.12 | Incorporated by reference from our Form 8-KA reporting an event of February 13, 2007.                                                                                                                                                                            
|99.13 | Incorporated by reference from our Form 8-KA reporting an event of January 19, 2007.                                                                                                                                                                             

# Signatures

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, Golden Eagle International, Inc. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

| |  | GOLDEN EAGLE
INTERNATIONAL, INC.By: /s/ Terry C. Turner
Terry C. TurnerPresidentDate: April 15, 2008
| |  | ------------------------------------------------------------------------------------------------------------------

Pursuant the Securities Exchange Act
of 1934, this report has been signed below by the following persons on behalf of Golden
Eagle International, Inc. and in the capacities and on the dates indicated.

| |  | GOLDEN EAGLE
INTERNATIONAL, INC.By: /s/  Terry C. Turner
Terry C. TurnerChairman of the Board of Directors and Principal Executive OfficerDate: April 15, 2008
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

63

| |  | By: /s/Alvaro Riveros 
 Alvaro RiverosDirectorDate: April 15, 2008
| |  | --------------------------------------------------------------------------------

| |  | By: /s/ Harlan M. (Mac) Delozier
Harlan M. (Mac) DelozierDirectorDate: April 15, 2008
| |  | ---------------------------------------------------------------------------------------------------

| |  | By: /s/ Tracy A. Madsen
Tracy A. Madsen, Corporate Secretary, Treasurer and Principal Accounting OfficerDate: April 15, 2008
| |  | ------------------------------------------------------------------------------------------------------------------------------------------

64

Exhibit 31.1 Section 302
Certification

CERTIFICATION

I, Terry C. Turner, certify that:

| | 1. | I
have reviewed this Annual Report on Form 10-K for the period ended December
               31, 2007 of Golden Eagle International, Inc.;
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------

| | 2. | Based
on my knowledge, this report does not contain any untrue statement of a
               material fact or omit to state a material fact necessary to make the
statements                made, in light of the circumstances under which such statements
were made, not                misleading with respect to the period covered by this
report;
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based
on my knowledge, the financial statements, and other financial information
               included in this report, fairly present in all material respects the
financial                condition, results of operations and cash flows of the
registrant as of, and                for, the periods presented in this report;
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The
registrants other certifying officer(s) and I are responsible for
               establishing and maintaining disclosure controls and procedures (as
defined in                Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial                reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the                registrant and have:
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | Designed such
disclosure controls and procedures, or caused such disclosure           controls and
procedures to be designed under our supervision, to ensure that           material
information relating to the registrant, including its consolidated
          subsidiaries, is made known to us by others within those entities, particularly
          during the period in which this report is being prepared;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Designed
such internal control over financial reporting, or caused such internal control over
          financial reporting to be designed under our supervision, to provide reasonable
          assurance regarding the reliability of financial reporting and the preparation
          of financial statements for external purposes in accordance with generally
          accepted accounting principles;
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Evaluated
the effectiveness of the           registrants disclosure controls and procedures
and presented in this           report our conclusions about the effectiveness of the
disclosure controls and           procedures, as of the end of the period covered by this
report based on such           evaluation; and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Disclosed
in this report any change in the registrants           internal control over
financial reporting that occurred during the           registrants most recent
fiscal quarter (the registrants fourth           fiscal quarter in the case of an
annual report) that has materially affected, or           is reasonably likely to
materially affect, the registrants internal           control over financial
reporting; and
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5. | The
registrants other certifying officer(s) and I have disclosed, based on
               our most recent evaluation of internal control over financial reporting,
to the                registrants auditors and the audit committee of the registrants
               board of directors (or persons performing the equivalent functions):
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | All significant
deficiencies and material weaknesses in the design or operation           of internal
control over financial reporting which are reasonably likely to           adversely
affect the registrants ability to record, process, summarize and           report
financial information; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Any
fraud, whether or not material, that           involves management or other employees who
have a significant role in the           registrants internal control over
financial reporting.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

65

Date: April 15, 2008

| |  | By: /s/ Terry C. Turner
Terry C. TurnerPrincipal Executive Officer
| |  | --------------------------------------------------------------------------------

Exhibit 31.2 Section 302
Certification

CERTIFICATION

I, Tracy A. Madsen, certify that:

| | 1. | I
have reviewed this Annual Report on Form 10-K for the period ended December
               31, 2007 of Golden Eagle International, Inc.;
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------

| | 2. | Based
on my knowledge, this report does not contain any untrue statement of a
               material fact or omit to state a material fact necessary to make the
statements                made, in light of the circumstances under which such statements
were made, not                misleading with respect to the period covered by this
report;
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based
on my knowledge, the financial statements, and other financial information
               included in this report, fairly present in all material respects the
financial                condition, results of operations and cash flows of the
registrant as of, and                for, the periods presented in this report;
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The
registrants other certifying officer(s) and I are responsible for
               establishing and maintaining disclosure controls and procedures (as
defined in                Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial                reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the                registrant and have:
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | Designed
such disclosure controls and procedures, or caused such disclosure           controls and
procedures to be designed under our supervision, to ensure that           material
information relating to the registrant, including its consolidated
          subsidiaries, is made known to us by others within those entities, particularly
          during the period in which this report is being prepared;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Designed
such           internal control over financial reporting, or caused such internal control
over           financial reporting to be designed under our supervision, to provide
reasonable           assurance regarding the reliability of financial reporting and the
preparation           of financial statements for external purposes in accordance with
generally           accepted accounting principles;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Evaluated
the effectiveness of the           registrants disclosure controls and procedures
and presented in this           report our conclusions about the effectiveness of the
disclosure controls and           procedures, as of the end of the period covered by this
report based on such           evaluation; and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) | Disclosed
in this report any change in the registrants           internal control over
financial reporting that occurred during the           registrants most recent
fiscal quarter (the registrants fourth           fiscal quarter in the case of an
annual report) that has materially affected, or           is reasonably likely to
materially affect, the registrants internal           control over financial
reporting; and
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

66

| | 5. | The
registrants other certifying officer(s) and I have disclosed, based on
               our most recent evaluation of internal control over financial reporting,
to the                registrants auditors and the audit committee of the registrants
               board of directors (or persons performing the equivalent functions):
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) | All
significant deficiencies and material weaknesses in the design or operation           of
internal control over financial reporting which are reasonably likely to
          adversely affect the registrants ability to record, process, summarize
and           report financial information; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Any
fraud, whether or not material, that           involves management or other employees who
have a significant role in the           registrants internal control over
financial reporting.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: April 15, 2008

| |  | By: /s/ Tracy A. Madsen
Tracy A. MadsenPrincipal Financial Officer
| |  | --------------------------------------------------------------------------------

67

Exhibit 32.1 Section 906
Certification

# CERTIFICATION PURSUANT
TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION
906 OF THE SARBANES-OXLEY ACT OF 2002

| | In
connection with the Annual Report of Golden Eagle International, Inc. (the Company)
on Form 10-K for the period ended December 31, 2007 as filed with the Securities and
Exchange Commission on the date hereof (the Report), I, Terry C. Turner,
Principal Executive Officer, certify, pursuant to 18 U.S.C. § 1350, as adopted
pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (1)              The
Report fully complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and
| | --------------------------------------------------------------------------------------------------------------------------------------

| | (2)              The
information contained in the Report fairly presents, in all material respects, the
financial condition and result of operations of the Company.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: April 15, 2008

| |  | By: /s/ Terry C. Turner
Terry C. TurnerPrincipal Executive Officer
| |  | --------------------------------------------------------------------------------

This certification accompanies this
Report pursuant to §906 of the Sarbanes-Oxley Act of 2002 and shall not, except to
the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the registrant
for the purposes of §18 of the Securities Exchange Act of 1934, as amended.  This
certification shall not be incorporated by reference into any filing under the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.  This
certification shall not be incorporated by reference into any filing under the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made
before or after the date of this Report), irrespective of any general incorporation
language contained in such filing.

A signed original of this written
statement required by §906 has been provided to the registrant and will be retained
by the registrant and furnished to the Securities and Exchange Commmission or its staff
upon request.

68

EXHIBIT 32.2 Section 906
Certification

# CERTIFICATION PURSUANT
TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION
906 OF THE SARBANES-OXLEY ACT OF 2002

| | In
connection with the Annual Report of Golden Eagle International, Inc. (the Company)
on Form 10-K for the period ended December 31, 2007 as filed with the Securities and
Exchange Commission on the date hereof (the Report), I, Tracy A. Madsen,
Principal Financial Officer, certify, pursuant to 18 U.S.C. § 1350, as adopted
pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (1)              The
Report fully complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and
| | --------------------------------------------------------------------------------------------------------------------------------------

| | (2)              The
information contained in the Report fairly presents, in all material respects, the
financial condition and result of operations of the Company.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: May 2, 2008

| |  | By: /s/ Tracy A. Madsen
Tracy A. MadsenPrincipal Financial Officer
| |  | --------------------------------------------------------------------------------

This certification accompanies this
Report pursuant to §906 of the Sarbanes-Oxley Act of 2002 and shall not, except to
the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the registrant
for the purposes of §18 of the Securities Exchange Act of 1934, as amended.  This
certification shall not be incorporated by reference into any filing under the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.  This
certification shall not be incorporated by reference into any filing under the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made
before or after the date of this Report), irrespective of any general incorporation
language contained in such filing.

A signed original of this written
statement required by §906 has been provided to the registrant and will be retained
by the registrant and furnished to the Securities and Exchange Commmission or its staff
upon request.

69

REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
and Stockholders of Golden Eagle International, Inc.

We have audited the accompanying
consolidated balance sheet of Golden Eagle International, Inc. and subsdiaries as of
December 31, 2007 and 2006 and the related consolidated statements of operations,
stockholders equity and cash flows for the years then ended. These financial
statements are the responsibility of the Companys management. Our responsibility is
to express an opinion on these consolidated financial statements based on our audits. We
did not audit the financial statements of Golden Eagle Bolivia Mining, S.A., Golden Eagle
International, Inc. (Bolivia) or Golden Eagle International (unincorporated) 93%, 100% and
100% owned subsidiaries, respectively, which statements reflect 30% and 24% of total consolidated
assets as of December 31, 2007 and 2006 respectively. Those financial statements were audited by other auditors
whose report has been furnished to us, and our opinion, insofar as it relates to the
amounts included for Golden Eagle Bolivia Mining, S.A., Golden Eagle International, Inc.
(Bolivia) and Golden Eagle International (unincorporated) as of December 31, 2007 and 2006 and is
based solely on the report of the other auditors.

We conducted our audits in accordance
with the standards of the PCAOB (United States). Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the consolidated financial
statements are free of material misstatement. The Company is not required to have, nor
were we engaged to perform, an audit of its internal control over financial reporting. Our
audit included consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the Companys internal
control over financial reporting. Accordingly, we express no such opinion. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in
the consolidated financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the
overall consolidated financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated
financial statements referred to above present fairly, in all material respects, the
consolidated financial position of Golden Eagle International, Inc. and subsdiaries as of
December 31, 2007 and 2006 and the results of its operations and cash flows for the years then ended
in conformity with U.S. generally accepted accounting principles.

The accompanying consolidated
financial statements have been prepared assuming that the Company will continue as a going
concern. As discussed in Note A, the Company has negative working capital and has incurred
substantial losses since its inception. The Company currently has no mineral production
and requires significant additional financing to satisfy its outstanding obligations and
resume and expand mining production. In addition, the Companys ability to conduct
operations remains subject to other risks, including operating in isolated regions of
Bolivia and the concentration of operations in a single undeveloped area. Unless the
Company successfully obtains suitable significant additional financing and can resume and
expand its production, there is substantial doubt about the Companys ability to
continue as a going concern. Managements plans in those matters are also described
in Note A. The consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

Chisholm, Bierwolf &
Nilson, LLC Bountiful,UT  March 12, 2008

F-1

# REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
and ShareholdersGolden Eagle Bolivia Mining S.A. Golden Eagle International, Inc.
Bolivia Golden Eagle International, Inc.

Salt Lake City, Utah

We have audited the accompanying
consolidated balance sheets of Golden Eagle Bolivia Mining S.A., Golden Eagle
International, Inc. Bolivia and Golden Eagle International as of December 31, 2007 and
2006 and the related consolidated statements of operations, cash flows and changes in
stockholders equity (deficit) for the years ended December 31, 2007 and 2006.
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 the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audits to obtain reasonable assurance about 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. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the accompanying
consolidated financial statements referred to above present fairly, in all material
respects, the financial position of Golden Eagle Bolivia Mining S.A., Golden Eagle
International, Inc. Bolivia and Golden Eagle International, Inc. at December 31, 2007 and 2006
and the results of its operations, changes in stockholders equity (deficit) and its
cash flows for the years ended December 31, 2007 and 2006, in conformity with
accounting principles generally accepted in the United States of America.

POZO & ASOCIADOS
C.P.A. S.R.L. NIT. 121611023 Lic.
          Aud. Enrique Pozo Balderrama NIT. 271218014 MAT. PROF. No CAUB  0040

La Paz, Bolivia January 31,
2008

F-2

|                                                                           |                  |                 
|-------------------------------------------------------------------------- | ---------------- | ----------------
|                                                                          
|Golden Eagle International, Inc.                                           |                  |                 
|Consolidated Balance Sheets                                               
|As of December 31, 2007 and 2006                                           | 2007             | 2006            
|                                                                          
|ASSETS                                                                    
|CURRENT ASSETS                                                            
|Cash & cash equivalents                                                    | $          2,742 | $          1,427
|Prepaid expenses                                                           | 94,049           | 20,198          
|                                                                          
|Total current assets                                                       | 96,791           | 21,625          
|                                                                          
|PROPERTY AND EQUIPMENT                                                    
|Mining equipment and property                                              | 595,190          | 978,703         
|Plant and mill - idle                                                      | 3,980,000        | 3,980,000       
|Mine development costs                                                     | 336,260          | 529,618         
|Mineral properties                                                         | 1,356,948        | 1,814,501       
|Office equipment                                                           | 110,710          | 118,555         
|Vehicles                                                                   | 110,018          | 87,018          
|                                                                          
|                                                                           | 6,489,126        | 7,508,395       
|Less accumulated depreciation and impairment                               | (836,438)        | (2,028,618)     
|                                                                          
|Total property and equipment                                               | 5,652,688        | 5,479,777       
|                                                                          
|Total Assets                                                               | $   5,749,479    | $   5,501,402   
|                                                                          
|LIABILITIES AND STOCKHOLDERS' EQUITY                                      
|CURRENT LIABILITIES                                                       
|Accounts payable and accrued expenses                                      | $      193,558   | $      271,947  
|Deferred wages                                                             | 54,529           | 55,237          
|Other notes payable                                                        | 214,111          | 32,002          
|Related party payable                                                      | 92,350           | 151,900         
|Covertible debenture                                                       | 249,000          | 249,000         
|Accrued interest payable                                                   | 110,187          | 43,634          
|                                                                          
|Total current liabilities                                                  | 913,735          | 803,720         
|                                                                          
|Convertible notes payable - net                                            | 109,006          | -               
|                                                                          
|Total long term liabilities                                                | 109,006          | -               
|                                                                          
|Derivative liability - preferred stock                                     | -                | 3,977,196       
|Common Stock payable                                                       | 61,000           | -               
|Commitments and contingencies                                              | -                | -               
|                                                                          
|Total Liabilities                                                          | 1,083,741        | 4,780,916       
|                                                                          
|STOCKHOLDERS' EQUITY                                                      
|Preferred stock, par value $.01 per share; 10,000,000 shares authorized,  
|345,961 and 1,988,598 issued and outstanding respectively                  | 3,460            | 19,886          
|Common stock, par value $.0001 per share; 2,000,000,000 authorized shares;
|1,602,510,490 and 789,999,990  issued and outstanding shares, respectively | 160,251          | 79,000          
|Additional paid-in capital                                                 | 59,259,002       | 49,000,939      
|Accumulated (deficit)                                                      | (54,756,975)     | (48,379,339)    
|                                                                          
|Total stockholders' equity                                                 | 4,665,738        | 720,486         
|                                                                          
|Total Liabilities and Stockholders Equity                                  | $   5,749,479    | $   5,501,402   
|                                                                          

The footnotes are an integral part
of these consolidated financial statements F-3

|                                                        |                        |                    
|------------------------------------------------------- | ---------------------- | -------------------
|                                                       
|Golden Eagle International, Inc.                        |                        |                    
|Consolidated Statements of Operations                  
|For the Years Ended December 31, 2007 and 2006         
|                                                       
|                                                        | 2007                   | 2006               
|                                                       
|REVENUES                                                | $                    - | $                 -
|OPERATING EXPENSES                                     
|Exploration and development                             | 297,776                | 262,820            
|General and administration                              | 1,218,035              | 1,293,742          
|Depreciation and depletion                              | 25,043                 | 54,032             
|                                                       
|Total operating expenses                                | 1,540,854              | 1,610,594          
|                                                       
|OPERATING (LOSS)                                        | (1,540,854)            | (1,610,594)        
|                                                       
|OTHER INCOME (EXPENSE)                                 
|Interest expense                                        | (92,349)               | (294,953)          
|Loss on sale of fixed assets                            | (1,509)                | (109,495)          
|Asset impairment                                        | (107,425)              | (286,867)          
|Financing costs preferred stock                         | (4,647,263)            | (1,988,598)        
|Other, net                                              | 11,764                 | 14,615             
|                                                       
|Total other income (expense)                            | (4,836,782)            | (2,665,298)        
|                                                       
|Loss before income taxes                                | (6,377,636)            | (4,275,892)        
|Income taxes                                            | -                      | -                  
|NET (LOSS)                                              | (6,377,636)            | (4,275,892)        
|                                                       
|Basic and diluted (loss) per share                      | (0.01)                 | (0.01)             
|                                                       
|Weighted average shares outstanding - basic and diluted | 830,814,298            | 774,969,305        
|                                                       

The footnotes are an integral part
of these consolidated financial statements F-4

|                                                          |  |  |  
|--------------------------------------------------------- |  |  | -
|Golden Eagle International, Inc.                          |  |  |  
|Consolidated Statements of Cash Flows                     |  | 
|For the Years Ended December 31, 2007 and 2006            |  | 
|                                                         
|                                                          |  |  |  
|                                                         
|CASH FLOWS FROM OPERATING ACTIVITIES                      |  | 
|Net (loss)                                                |  |  | $
|Adjustments to reconcile net (loss)                       |  | 
|to net cash (used) by operating activities:               |  | 
|Stock issued for services                                 |  |  |  
|Stock payable for services                                |  |  |  
|Stock issued for exploration and development              |  |  |  
|Depreciation                                              |  |  |  
|Loss on sale of assets                                    |  |  |  
|Asset Impairment                                          |  |  |  
|Assets written off                                        |  |  |  
|Preferred stock issued for interest                       |  |  |  
|Financing costs - preferred stock                         |  |  |  
|Changes in operating assets and liabilities               |  |  |  
|Decrease (increase) in prepaid expense and other costs    |  |  |  
|Increase (decrease) in deffered wages                     |  |  |  
|Increase (decrease) in accounts payable                   |  |  |  
|Increase (decrease) in accrued interest                   |  |  |  
|                                                         
|Net cash flows (used by) operating activities             |  |  |  
|                                                         
|CASH FLOWS FROM INVESTING ACTIVITIES                      |  | 
|Investment in property and equipment                      |  |  |  
|Proceeds from sales of fixed assets                       |  |  |  
|                                                         
|Net cash flows provided by (used) in investing activities |  |  |  
|                                                         
|                                                          |  |  |  
|CASH FLOWS FROM FINANCING ACTIVITIES                      |  | 
|Borrowings from related parties                           |  |  |  
|Repayments to related parties                             |  |  |  
|Proceeds from other notes payable                         |  |  |  
|Repayments of other notes payable                         |  |  |  
|Payment of contract payable                               |  |  |  
|Preferred stock sold                                      |  |  |  
|Common stock sold                                         |  |  |  
|                                                         
|Net cash flows provided by financing activities           |  |  |  
|                                                         
|NET INCREASE (DECREASE) IN CASH                           |  |  |  
|CASH - BEGINNING OF PERIOD                                |  |  |  
|                                                         
|CASH - END OF PERIOD                                      |  |  | $
|                                                         
|SUPPLEMENTAL CASH FLOW INFORMATION                        |  |  |  
|Non cash financing and investing activities               |  |  |  
|Preferred stock issued for debt (see note B)              |  |  |  
|Account payable to convertible notes payable              |  |  |  
|                                                         
|Cash paid for                                             |  |  |  
|Interest                                                  |  |  |  
|Taxes                                                     |  |  |  
|                                                         

The footnotes are an integral part
of these consolidated financial statements F-5

---

|Golden Eagle International, Inc.Consolidated Statement of Changes in Stockholders' Equity 
For the Period January 1, 2006 through December 31, 2007
|---------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                   
|                                                                                                                                                   
|                                                                                                                                                   
|Balance at January 1, 2006                                                                                                                         
|                                                                                                                                                   
|Issued for cash ($.0075 to $.013 per share)                                                                                                        
|Issued for services ($.012 to $.0145 per share)                                                                                                    
|Issued for exploration ($.01767 to $.03433 per share)                                                                                              
|Preferred stock issued in exchange for debt                                                                                                        
|Preferred stock issued in exchange for interest                                                                                                    
|Net (loss)                                                                                                                                         
|                                                                                                                                                   
|Balance at December 31, 2006                                                                                                                       
|                                                                                                                                                   
|Issued for services ($.008 to $.011 per share)                                                                                                     
|Preferred stock issued for cash                                                                                                                    
|Preferred stock issued in exchange for debt                                                                                                        
|Preferred stock issued in exchange for interest                                                                                                    
|Preferred stock issued for service                                                                                                                 
|Preferred stock converted to common stock                                                                                                          
|Financing costs                                                                                                                                    
|Net (loss)                                                                                                                                         
|                                                                                                                                                   
|Balance at December 31, 2007                                                                                                                       
|                                                                                                                                                   

The footnotes are an integral part
of these consolidated financial statements F-6

---

# Golden Eagle
International, Inc.

# Notes to Consolidated
Financial Statements

---

# Note A 
Organization and Business

| | Organization
and Nature of BusinessGolden
Eagle International, Inc. (we, or Golden Eagle) was incorporated
in Colorado on July 21, 1988. Our mining and exploration activities have been in two areas
in the Republic of Bolivia. The first area consists of the combined Cangalli and Tipuani
Valley gold properties covering 12,000 acres in western Bolivia and contains our recent
Cangalli gold mining operations (October 2002 to June 2004). The second area consists of
our aggregate Precambrian properties covering 136,500 acres in eastern Bolivia and
contains our Buen Futuro A Zone gold and copper project, as well as our B and C Zone gold
projects.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Starting
in the fourth quarter 2002, we began mining gold bearing ore and selling gold from our
Cangalli property. Prior to fourth quarter 2003, we were a mining enterprise in the
exploration stage as set forth in Statement of Financial Accounting Standards,
SFAS No. 7, Accounting and Reporting by Development Stage
Enterprises and Industry Guide 7 of the Securities and Exchange
Commissions Guides for the Preparation of Registration Statements and with the
Society for Mining, Metallurgy and Explorations Guide for Reporting
Exploration Information, Mineral Resources, and Mineral Reserves dated March 1,
1999.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
June 2004, we discontinued the gold mining operations at our Cangalli property because of
a dispute between the United Cangalli Gold Mining Cooperative, Ltd. (UCL), which sold us
the Cangalli property, and FENCOMIN, the Bolivian governmental regulator of cooperatives
and other Bolivian governmental regulators. The dispute between UCL and the Bolivian
government regulators involved a claim by the government that UCL was in arrears on past
contributions to the National Mining Pension Fund and that UCL had failed to observe
certain legal formalities regarding its formation and ongoing operation. We, and our
Bolivian counsel, do not believe the dispute between UCL and the Bolivian government
involves Golden Eagle. However, as a legal safeguard against a possible claim or
intervention in our mining operation, we halted our mining activity. We currently do not
have an expectation for the recommencement of mining activities at our Cangalli gold mine
and cannot assure that those activities will ever recommence.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Our
current priorities are to develop our Precambrian properties in eastern Bolivia. We are
currently constructing an operating gold plant on our C Zone property. We hope to begin
producing gold for sale during 2008. The finalization of the construction of a production
plant on the C Zone is dependant upon raising capital for construction, which we cannot
guarantee at this time. We also continue to develop our Buen Futuro A Zone gold and copper
prospect, which is also located in the middle of our Precambrian properties. We are
currently working with an engineering company to determine what additional information or
exploration may be required to potentially upgrade our Buen Futuro A Zone feasibility
study to the status of a bankable feasibility study. We hope this process of proving the
feasibility of our A Zone project will enable us to raise sufficient financing to
construct a gold and copper mine and production facility on site and to begin full scale
operations. We are unable to offer any assurances that we will be able to complete a
bankable feasibility study or raise the necessary financing to construct a mine and plant
at Buen Futuro.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Organization
of Subsidiaries and Bolivian Mining ActivitiesIn
January 1996, we organized two Bolivian corporations, Golden Eagle Bolivia Mining, S.A.
(GEBM) and Eagle Mining of Bolivia, Ltd. (EMB), to acquire mining
rights to 5,000 acres from United Cangalli Gold Mining Cooperative, Ltd.
(UCL). We own a majority interest in those companies. In 2001, Golden Eagle
formed a wholly owned Bolivian corporation, Golden Eagle International, Inc. Bolivia
(GEII Bolivia) to conduct all continuing operations in Bolivia. In 2002, we
transferred substantially all agreements, obligations, assets and mining rights in Bolivia
to GEII Bolivia. GEBM and EMB are currently inactive.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Going Concern ConsiderationsThe
accompanying financial statements have been presented assuming we will continue as a going
concern, which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business. However, we had negative working capital of $816,943 as
of December 31, 2007 and we have incurred substantial losses of $54,756,975 since our
inception. In addition, we discontinued operations at our Cangalli gold mine in 2004. We
can provide no detailed time period as to if or when we may recommence operations at
Cangalli. As a result we have fully impaired all acquisition costs and capitalized
development costs of our Cangalli prospect. We are also developing our Precambrian
prospects, which will require significant additional financing or equity funding.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-7

| | We
estimate that we will need to raise approximately $10 million to develop our Buen Futuro A
Zone project prior to production under our existing business plan if we conclude that we
should dismantle our Gold Bar mill located in Eureka, Nevada and move it to our Buen
Futuro A Zone project site. If, however, we conclude that we should acquire a new mill or
the components for a substantially new mill for the A Zone project, then the costs may
exceed our estimates by two or three times. As a result, there is substantial doubt about
our ability to continue as a going concern. The financial statements do not include any
adjustments to reflect the possible future effect on the recoverability and classification
of assets or the amounts and classification of liabilities that may result from the
outcome of this uncertainty.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | We
plan, but cannot assure that we will be able, to obtain additional funds, including
private placements of preferred stock, short-term loans, suitable joint venture
relationships and long-term debt financing from international development agencies or
investors for our Buen Futuro A Zone project.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Note B  Summary of
Significant Accounting Policies

| |  | Principles
of ConsolidationThe financial statements include the accounts of Golden Eagle International, Inc. and its
subsidiaries Golden Eagle Bolivia Mining, S.A. (inactive), Eagle Mining of Bolivia, Ltd.
(inactive), Golden Eagle International, an unincorporated Bolivian entity, and Golden
Eagle International, Inc. (Bolivia). All inter-company transactions and balances have been
eliminated. Minority interests are not presented since they are not obligated to fund
operating losses.
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Use
of Estimates Preparation of financial statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions that affect
the amounts reported in the financial statements and accompanying notes. Significant areas
requiring the use of management estimates include the determination of mineral ore
quantities and the depletion expense calculation, useful lives of property and equipment
for depreciation, impairment valuations and calculation of any deferred taxes. Actual
results may differ from those estimates, and such differences may be material to the
financial statements.
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ReclassificationsCertain
amounts in 2006 have been reclassified to conform to the 2007 presentation. These
reclassifications were not material to the financial statements.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Foreign
CurrencyThe
functional currency for our foreign subsidiaries is U.S. dollars. The financial
transactions, records and statements of these foreign subsidiaries are all measured in
U.S. dollars using the effective daily exchange rate. As a result, we have no material
currency translation gains or losses. Where the local currency is used to record
transactions, any material currency translation gains or losses would be included as an
element of comprehensive income in the statement of operations and in the equity section
of the balance sheet.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Concentration
of Credit RiskOur
cash equivalents and prepaid expenses (and trade receivables when recorded) are exposed to
concentrations of credit risk. We manage and control risk by maintaining cash with a major
financial institution. The amount on deposit may occasionally exceed the $100,000
federally insured limit. However, management believes that the financial institution is
financially sound and the risk of loss is low. Our prepaid expenses consist of value added
taxes refundable and amounts held by third parties pending settlement for purchase of
goods or services. We believe that the risk of realization is low. Current risk of any
trade receivables from sale of minerals is minimized by the short periods for which any
such receivables are outstanding. Of our total assets net of depreciation and impairment,
$1,309,514, or 23%, are located in Bolivia with $4,439,965, or 77%, located in the
United States.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-8

| | Concentrations
and Economic VulnerabilityConcentrations
and economic vulnerability include reliance on two areas containing our mining prospects
in isolated regions of a foreign country, limited financial capacity of related parties
and/or others to continue funding operations and inability to rely on the future stability
of the local, regional and national governments in Bolivia. If we are successful in
achieving sustained, profitable commercial levels of production in Bolivia, we will need
significant quantities of mining equipment and supplies that are presently in short supply
or which may be locally unavailable. Weather may also impact mining operations and
transportation of heavy mining equipment in many regions of Bolivia. In addition, we sell
substantially all of our gold to one buyer; however, gold is marketable throughout the
world.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Fair
Value of Financial InstrumentsDue
to their short-term nature, the carrying value of our current financial assets and
liabilities approximates their fair values. The fair value of our borrowings, if
recalculated based on current interest rates, would not significantly differ from the
recorded amounts.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Cash and Cash
EquivalentsFor
the statement of cash flows, any liquid investments with a maturity of three months or
less at the time of acquisition are considered to be cash equivalents.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | InventoryInventories,
if any, consist of in-process ore and gold inventories.
| | -----------------------------------------------------------------------------

| | In-process
inventories represent gold ore that is currently in the process of being converted to a
saleable product. The conversion process is mill in-circuit, which converts the gold ore
into gold concentrates and doré. In-process inventories are valued at the lower of
average production cost or net realizable value. As of December 31, 2007 and 2006, there
was no in-process inventory.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Gold
inventories represent processed gold concentrates, doré and ingots. Gold
inventories that are received as in-kind payments of royalties are valued at fair value on
the date the gold is transferred to us. Gold inventory that results from our mining and
processing activities is valued at the lower of average production cost or net realizable
value. At December 31, 2007 and 2006, we held no gold in inventory.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Property, Equipment
and Mineral DevelopmentProperty
and equipment are recorded at cost. Maintenance and repair costs are charged to expense as
incurred, and renewals and improvements that extend the useful life of assets are
capitalized. Depreciation on property and equipment is computed using the straight-line
method over the assets estimated useful lives as follows:
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                 |           
|---------------- | ----------
|Mining equipment | 7-8 years 
|Vehicles         | 5 years   
|Office equipment | 4-10 years

| | Depreciation
expense totaled $25,043 and $54,032 for the years ended December 31, 2007 and 2006,
respectively.
| | --------------------------------------------------------------------------------------------------------------

| | Costs
associated with the acquisition and development of mining prospects are capitalized on a
property-by-property basis. Mineral exploration costs are expensed as incurred. Mine
infrastructure development costs incurred prior to establishing proven and probably
reserves are expensed. When it otherwise becomes probable that infrastructure costs will
not be recoverable, they are impaired. When it has been determined that a mineral property
can be economically developed, the costs incurred to develop such property, including
costs to further delineate the ore body and remove overburden to initially expose the ore
body, are capitalized as incurred. These costs are amortized using the units-of-production
(UOP) method over the estimated life of the ore body based on estimated
recoverable ounces of proven and probable reserves.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-9

| | To
the extent that any development costs benefit an entire mineralized property, they are
amortized over the estimated life of the property. The specific capitalized cost bases
subject to depletion are calculated on a formula based on the number of tonnes of ore that
are expected to be mined divided by the total tonnes in proven and probable reserves in
the property. Depletion for the years 2007 and 2006 was $0, each year.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | Mineral
interests and propertyMineral
interests include the costs of acquired mineral rights and royalty interests in
production, development and exploration stage properties.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Production
stage mineral interests represent interests in operating properties that contain proven
and probable reserves. Development stage mineral interests represent interests in
properties under development that contain proven and probable reserves. Exploration stage
mineral interests represent interests in properties that are believed to potentially
contain mineralized material.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Our
royalty interest consists of a 10% gross royalty on gold production from a single shaft
mine operation, which was leased back to UCL with the purchase of the Cangalli properties.
As a result of issues that have arisen between the UCL and Bolivian governmental
regulators, the UCL is currently enjoined from mining the shaft. We have not allocated any
cost to our current royalty interest.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Mineral
interests related to mining properties in the production stage are amortized over the life
of the related property using the UOP method in order to match the amortization with the
expected underlying future cash flows. Development stage mineral interests are not
amortized until such time as the underlying property is converted to the production stage.
Exploration stage mineral interests associated with adjacent production stage property are
amortized on a straight-line basis over the period that we expect to convert, develop or
further explore the underlying properties.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | Long-Lived AssetsWe
follow Statement of Financial Standard (SFAS) No. 144, Accounting for
the Impairment and Disposal of Long-Lived Assets, which requires that long-lived
assets to be held and used be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be recoverable. An
impairment loss would be recognized when the estimated future cash flows are less than the
carrying amount of the asset and would be calculated based on discounted cash flows. As of
December 31, 2007 we fully impaired our property acquisition costs of our Cangalli
property as well as the capitalized development cost as a result of our discontinuation of
mining operations. See note C for a full description of our impairment.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | Revenue Recognition
and Production CostsRevenue
is recognized when the price is determinable, upon delivery and transfer of title of gold
to the customer and when the collectibility of sales proceeds is assured. Production costs
of gold sold include labor and related direct and indirect costs of mine and plant
operations. Production costs are charged to operations as incurred. In September 2002, we
began mining operations at our Cangalli gold mine. In June 2004, operations were suspended
at the Cangalli gold mine due to the previously discussed issues that had arisen between
the UCL and Bolivian governmental regulators. As of December 31, 2007 and 2006, no
revenues or production costs were recorded.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Reclamation and
Remediation Costs (Asset Retirement Obligations)We
have adopted SFAS No. 143, Accounting for Asset Retirement Obligations. SFAS
No. 143 addresses financial accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated asset retirement costs. In our
current Bolivian operations, we do not have a legal or contractual obligation for
reclamation or remediation of our mines after mining has ceased. As a result, the adoption
of SFAS No. 143 does not currently have a material impact on our financial position,
results of operations or cash flows. However, once development of our Buen Futuro property
begins, we expect to incur asset retirement obligations based on the metal extraction
methods planned.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | Stock Based
CompensationAs
of January 1, 2006, we elected to measure and record compensation cost relative to stock
option costs in accordance with SFAS 123 (Revised 2004), Accounting For Stock
Based Compensation, (SFAS 123(R)) which requires the company to use the
Black-Scholes pricing model to estimate the fair value of the options at the grant date.
No options were granted or outstanding as of December 31, 2007 and 2006.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-10



| | Beneficial
Conversion Feature of Debentures and Convertible Notes PayableIn
accordance with Emerging Issues Task Force No. 98-5, Accounting for Convertible
Securities with Beneficial Conversion Features or Contingently Adjustable
Conversion Ratios, and No. 00-27, Application of Issue No. 98-5 to Certain
Convertible Instruments, we recognize the advantageous value of conversion
rights attached to convertible debt. Such rights give the debt holder the ability to
convert his debt into common stock at a price per share that is less than the trading
price to the public on the day the loan is made to us. The beneficial value is calculated
as the intrinsic value (the market price of the stock at the commitment date in excess of
the conversion rate) of the beneficial conversion feature of debentures and related
accruing interest is recorded as a discount to the related debt and an addition to
additional paid in capital. The discount is amortized over the remaining outstanding
period of related debt using the interest method. The conversion price of the outstanding
debenture was in excess of the market price on the date the debenture was entered into and
as such, we believe no beneficial conversion feature applies to this debenture. We did,
however, calculate a beneficial feature on our Series B Convertible Preferred stock which
we issued in 2007 and 2006. The beneficial conversion was treated as a financing cost with
the offsetting entry classified as a derivative liability. During 2007 we issued two convertible notes payable to two of our officers in the amount of $50,000 each which are
         convertible into our common shares.  As the conversion rate was the same as market price on the date of the note the
         beneficial conversion feature did not exist.  We also issued a convertible note payable in the amount of $45,030 to Burns,
         Figa & Will P.C. for past due legal services which is convertible into our common stock.  As the conversion price of $.004
         per share on the date of the note was less than the $.009 market price the beneficial conversion feature applied to this
         note.  The following table demonstrates the accounting for convertible note payable issued during 2007.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Convertible
notes payable
| | -------------------------

|                        |                  |                                |                |                   
|----------------------- | ---------------- | ------------------------------ | -------------- | ------------------
|Payable to              | Note face amount | Discount beneficial conversion | Financing cost | Net amount of note
|                        |                  |                                |                |                   
|Burns, Figa & Will P.C. | $  45,030        | $36,024                        | $9,006         | $    9,006        
|Harlan (Mac Delozier    | $  50,000        | -                              | -              | 50,000            
|Tracy A. Madsen         | $  50,000        | -                              | -              | 50,000            
|Total                   | $145,030         | $36,024                        | $9,006         | $109,006          

| | (Loss)
Per Share
| | ----------------

| | The
computation of diluted earnings (loss) per common share is based on the weighted average
number of shares outstanding during          the year plus the common stock equivalents,
which would arise from (a) 86,490,500 from the conversion of preferred stock to
         common stock; (b) 10,000,000 shares reserved for the conversion of a debenture
payable; and (c) 22,368,720 shares reserved          for the conversion of our
convertible notes payable. The inclusion of these shares would have resulted in a
weighted average          shares fully diluted number that was anti-dilutive and as such
they are excluded from the weighted average shares basic and          diluted
calculation.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                            |             |                
|------------------------------------------- | ----------- | ---------------
|For the years ended December 31,            | 2007        | 2006           
|                                            |             |                
|Net Loss                                    | (6,377,636) | ($   4,275,892)
|Weighted average shares outstanding - basic | 830,814,298 | 774,969,305    
|Basic (loss) per share                      | (.01)       | (.01)          

| | Income
TaxesWe
use the liability method of accounting for income taxes under which deferred tax assets
and liabilities are recognized for the future tax consequences of temporary differences
between the accounting basis and the tax basis of our assets and liabilities. The deferred
tax assets and liabilities are computed using enacted tax rates in effect for the year in
which the temporary differences are expected to reverse.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-11



| | Statement
of Cash Flows Information and Supplemental Non-Cash Financing ActivitiesDuring
2007 and 2006 we paid cash for interest of $21,551 and $33,027 respectively. Non-cash
investing and financing transactions during the periods consist of the following:
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                              |            
|----------------------------------------------------------------------------- | -----------
|2007                                                                          |            
|Accrued interest paid with preferred stock - recorded as derivative liability | 3,846      
|Debt paid with preferred stock - recorded as derivative liability             | 1,043,155  
|Preferred stock issued for services                                           | 12,103     
|Preferred stock issued in exchange for common stock                           | (3,210,042)
|Financing cost of preferred stock - recorded as derivative liability          | 7,017,846  
|                                                                              |            
|2006                                                                          |            
|Accrued interest paid with preferred stock - recorded as derivative liability | 282,015    
|Debt paid with preferred stock - recorded as derivative liability             | 1,706,583  
|Financing cost of preferred stock - recorded as derivative liability          | 1,988,598  

| | Effect
of New Accounting Pronouncements
| | ---------------------------------------

| | In
February 2006, the FASB issued SFAS No. 155, ACCOUNTING FOR CERTAIN HYBRID FINANCIAL
INSTRUMENTS AN AMENDMENT OF FASB STATEMENTS NO. 133 AND 140.This Statement amends FASB
Statements No. 133, accounting for Derivative Instruments and Hedging Activities, and No.
140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities. This statement resolves issues addressed in Statement 133 Implementation
Issued No. D1, Application of Statement 133 to Beneficial Interests in Securitized
Financial Assets. The adoption of SFAS No. 155 did not have an impact on the Companys
consolidated financial statements.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
March 2006, the FASB issued SFAS No. 156, ACCOUNTING FOR SERVICING OF FINANCIAL ASSETS AN
AMEDNMENT OF FASB STATEMENT No. 140. This Statement amends FASB Statement No. 140,
Accounting for Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities, with respect to the accounting for separately recognized servicing assets
and servicing liabilities. The adoption of SFAS No. 156 did not have an impact on the
Companys consolidated financial statements.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
September 2006, the FASB issued SFAS No. 157, FAIR VALUE MEASUREMENTS. This statement
defines fair value, establishes a framework for measuring fair value in generally
accepted accounting principles (GAAP), and expands disclosures about fair value
measurements. This Statement is effective for financial statements issued for fiscal
years beginning after November 15, 2007, and interim periods within those fiscal years.
The adoption of SFAS 157 did not have an impact on the Companys consolidated
financial statements. The Company presently comments on significant accounting policies
(including fair value of financial instruments) in Note 2 to the financial statements.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
September 2006, the FASB issued SFAS No. 158, EMPLOYERS ACCOUNTING FOR DEFINED
BENEFIT PENSION AND OTHER POSTRETIREMENT PLANS AN AMENDMENT OF FASB STATEMENTS NO. 87,
88, 106 AND 132(R). This statement improves financial reporting by requiring an employer
to recognize the overfunded or underfunded status of a defined benefit postretirement
plan (other that a multiemployer plan) as an asset or liability in its statement of
financial position and to recognize changes in that funded status in the year in which
the changes occur through comprehensive income of a business entity or changes in
unrestricted net assets of a not-for-profit organization. The adoption of SFAS No. 158
did not have an impact on the Companys consolidated financial statements.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
February 2007, the FASB issued SFAS No. 159, THE FAIR VALUE OPTION FOR FINANCIAL ASSETS
AND FINANCIAL LIABILITIES  INCLUDING AN AMMENDMENT OF FASB STATEMENT NO.115. This
statements objective is to improve financial reporting by providing the Company with the
opportunity to mitigate volatility in reported earnings caused by measuring related
assets and liabilities differently without having to apply complex hedge accounting
provisions. This statement is expected to expand the use of fair value measurement, which
is consistent with the FASBs long-term measurement objective for accounting for
financial instruments. The adoption of SFAS 159 did not have an impact on the Companys
financial statements. The adoption of SFAS No. 159 did not have an impact on the Companys
consolidated financial statements.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-12

| | In
December 2007, the FASB issued SFAS No. 160, NONCONTROLLING INTERESTS IN CONSOLIDATED
FINANCIAL STATEMENTS  AN AMENDMENT OF ARB NO. 51. This statements objective is to
improve the relevance, comparability, and transparency of the financial information that
a reporting entity provides in its consolidated financial statements by establishing
accounting and reporting standards that require ownership interests in the subsidiaries
held by parties other than the parent be clearly identified. The adoption of SFAS 160 did
not have an impact on the Companys financial statements.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
December 2007, the FASB issued SFAS No. 141 (revised), BUSINESS COMBINATIONS. This
revision statements objective is to improve the relevance, representational faithfulness,
and comparability of the information that a reporting entity provides in its effects on
recognizing identifiable assets and measuring goodwill. The adoption of SFAS 141
(revised) did not have an impact on the Companys financial statements.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Note C  Mineral
Interests and Mining Assets

| | Our
mine development costs and mineral interests are presented on the balance sheet with the
total of related depletion and impairment aggregated for mining and equipment assets. An
analysis of our mining properties follows:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                 |            |          
|---------------------------------------------------------------- | ---------- | ---------
|                                                                 | 2007       | 2006     
|Mine development costs                                           | $336,260   | $529,618 
|Mineral properties                                               | 1,356,948  | 1,814,501
|                                                                 |            |          
|Total mineral interests and development costs                    | 1,693,208  | 2,344,119
|Less: accumulated impairment and depletion of development costs  | -          | (490,423)
|Less: accumulated impairment and depletion of mineral properties | (545,000)  | (962,047)
|                                                                 |            |          
|Net mine development costs                                       | $1,148,208 | $891,641 
|                                                                 |            |          

| | Our
mining equipment consists of the following:
| | -----------------------------------------------

|                                |           |          
|------------------------------- | --------- | ---------
|                                | 2007      | 2006     
|Machinery and equipment         | $469,728  | $803,421 
|Replacement materials and parts | 116,166   | 163,146  
|Tools                           | 9,296     | 12,136   
|                                |           |          
|Total mining equipment          | 595,190   | 978,703  
|Less: accumulated depreciation  | (158,986) | (450,757)
|                                |           |          
|Net mining equipment            | $436,204  | $527,946 
|                                |           |          

| | During
the review of our December 31, 2007 financial statements we made the determination to
eliminate both the asset amount and the accumulated depreciation or impairment amount on
those assets which had been fully depreciated or impaired and which were not longer in
service. This elimination resulted in the elimination of $272,502 from mining equipment
that was originally depreciated during 2002 and a corresponding amount was listed under
accumulated depreciation. As these two amounts were netted each other the net impact on
property and equipment less accumulated depreciation was zero. As this equipment is no
longer usable the amount of $272,502 was removed from both the asset account and the
accumulated depreciation amount. During the years 2004 through 2007 we fully impaired our
mining assets associated with our Cangalli claim. Prior to this year we carried both the
asset value and the accumulated impairment associated with that asset and which netted out
to zero. During 2007 we made the determination that we would eliminate both the value of
the asset and the accumulated impairment associated with that asset. As a result, as of
December 31, 2007 we eliminated $490,423 from mine development costs and an equal amount
form accumulated depreciation. This total amount had been previously impaired.
Additionally, we increased mine development costs by $297,065 for capitalized fees related
to our development of our A and C Zones at Buen Futuro. We also eliminated $417,047 from
mineral properties and a corresponding amount from accumulated impairment for the same
reasons listed above. While the net effect of these eliminations is zero we believe that
it simplifies our internal accounting and better reflects our current financial situation
to the readers of this report. We continue to include $545,000 in mineral properties which
has been fully impaired and which a corresponding amount is included in accumulated
impairment for accounting purposes and which we feel accurately portrays the financial
condition of the company. The inclusion of this amount does not impact the total assets of
the company nor the total shareholders equity.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-13

| | During
2006 we booked an impairment in the amount of $286,867 of the remaining property
acquisition costs of our Cangalli mine site as a result of our inability to recommence
operations at the Cangalli mine. This impairment is in addition to the $1,165,603
impairment that we took in 2002 and 2004 as a result of issues that arose among the United
Gold Mining Cooperative, Ltd. that had sold us a 5,000-acre mining concession, and
FENCOMIN, the Bolivian governmental regulator of cooperatives, as well as other Bolivian
regulators. These legal disputes, while having nothing to do with us, created an insecure
atmosphere at our Cangalli gold mine and raised serious questions about whether formal
intervention would occur and substantially hamper operations. While we continue to
maintain our claims and may recommence mining and processing operations at Cangalli at
some point in the future, we can offer no precise date as to when we may be able to or
will begin mining and processing ore at Cangalli. We believe that our best course of
action is to put our efforts and financial resources into developing our Precambrian
properties in eastern Bolivia prior to recommencing operations at Cangalli. As we do not
have a precise time frame for returning to Cangalli, and we cannot guarantee that we will
ever be able to recommence operations at our Cangalli mine, we believed the most
conservative course of action on an accounting basis was to fully impair all acquisition
costs and capitalized development costs of our Cangalli property.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Our
mineral interests consist of the following specific properties:
| | -------------------------------------------------------------------

|                               |            |           
|------------------------------ | ---------- | ----------
|                               | 2007       | 2006      
|Precambrian mineral properties | $758,810   | $736,500  
|Cangalli mineral properties    | 581,138    | 1,078,001 
|                               |            |           
|Total                          | $1,356,948 | $1,821,451
|                               |            |           

| | On
July 2, 2002, we acquired the Cangalli mining property from UCL, a mining cooperative. The
purchase price, capitalized as mineral properties, includes the following components:
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                              |         
|------------------------------------------------------------- | --------
|Cash                                                          | $300,000
|Obligations assumed and payable over approximately four years | 175,000 
|Prior contract payments                                       | 70,000  
|Common stock issued                                           | 417,047 
|Total                                                         | $962,047

| | As
part of the purchase agreement we agreed to take on certain debt owed by the cooperative.
As of December 31, 2005 this obligation totaled $77,359. During 2006 we eliminated this
obligation by transferring $161,446 in mining equipment located at Cangalli to the United
Cangalli Gold Mining Cooperative, Ltd. in exchange for elimination of $71,113 in debt we
owed to the cooperative. This equipment had a book value of $122,320 and we booked a loss
on the sale of assets in the amount of $46,320. We were required by the cooperative to pay
off this debt prior to removing any of our equipment from the Cangalli mine site.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-14

| | In
June 2003, we acquired 100% of the Buen Futuro mining property located adjacent to Golden
Eagles other landholdings in the Precambrian Shield. The purchase price was
capitalized as mineral properties and includes the following components:
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                         |         
|------------------------ | --------
|Cash paid                | $250,000
|Contract payable in cash | 40,000  
|Common stock issued      | 175,000 
|Total                    | $425,000

| | The
Buen Futuro property consists of 2,500 acres. We have met our obligations to pay $250,000
in cash and stock valued at $175,000. We also were obligated pay an additional $40,000 in
cash plus $10,000 in penalty interest in consideration for amending the original agreement
and extending the terms of payment.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
June 2004 we acquired the Gold Bar mill and plant (currently not operating) to be shipped
to Bolivia and used to process gold and copper ore at the Buen Futuro prospect. We
exchanged 30,000,000 shares of common stock for the mill and valued the transaction at
$3.6 million based on the trading price of the stock on the day of closing. In May of 2005
we issued an additional 20,000,000 shares of stock valued at $380,000 in order to amend
the original sales agreement which required us to remove the plant from the site outside
Eureka, Nevada by June 2005. The amended agreement eliminates this requirement. We
estimate that dismantling; shipping and re-erecting the plant at Buen Futuro will cost
approximately $3.5 million. We are currently evaluating the possibility of selling the
plant as to fund operations in Bolivia or recommence tolling operations at Gold Bar to
process ore from other mining companies. We currently do not have estimates for the cost
of a tolling operation.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Note D  Loans and
Notes Payable

F-15

| | We
have debt obligations outstanding at December 31, 2007 and 2006 as follows:
| | ------------------------------------------------------------------------------

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------- | ---------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 2007      | 2006     
|Interest bearing payable to a former officer and director of ours, secured
         by our aircraft located in Bolivia, 12% interest per annum, due on demand.
         During 2006 the aircraft was disassembled, shipped to the United States
         and reassembled by the note holder. The costs of the transfer as well as
         other costs relating to the aircraft were added to the note during 2006 in
         the amount of $69,135. In October 2006 the aircraft was sold to the note
         holder for $61,100 and the sales price was deducted from the amount due.
         This note is carried in the category other notes payable.  On December 21,
         2008 we were informed that the debt had been purchased by RAF y CIA and a
         demand was made for payment.  On February 5, 2008 we settled this debt
         plus accrued interest and a settlement fee for 5,137,231 of our common
         shares.                                                                                                                                                                                                                                         | 32,002    | 32,002   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|Three notes payable to Edmundo Arauz, a Bolivian resident, dated
         December 5, 11, and 19, 2007. These notes carry an interest rate of 8%
         per annum and mature on December 31, 2008. This note is carried in the
         category "other notes payable."                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 47,109    | -        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|An interest-bearing note payable to Kevin Pfeffer, a former director.
         The note bears an interest rate of 8% per annum and is payable upon
         demand.  Mr. Pfeffer resigned from the board on December 4, 2006 and
         on December 19, 2006 demanded full payment of this note. As of
         December 31, 2007 we had been unable to pay this note and Mr. Pfeffer
         had threatened legal action against us. As Mr. Pfeffer is no longer
         considered an affiliate due to the fact that he is no longer a
         director and no longer owns more than 10% of our outstanding stock,
         this note was carried as an other note payable on December 31, 2007.
         On January 25, 2008 we reached a settlement agreement with Mr. Pfeffer
         wherein he accepted 57,608,593 shares of our common stock for full
         payment of this note, accrued interest, other expenses he had incurred
         as a director and a penalty fee which we carry in these financial
         statements under accrued interest.  As of the date of this report we
         have not repaid this note and we do not know when we will repay it. | 135,000   | 135,000  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|A note payable to Terry Turner our Chairman and Chief Executive Officer at
         0% interest Funds loaned to us during 2006 totaled $9,100 with repayments
         of $9,000 leaving a balance of $100 which was paid in 2007. This note was
         carried as a related party payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | -         | 100      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|A note payable to Harlan (Mac) Delozier our director and Vice President of
         Bolivian Administration at 0% interest. Mr. DeLozier received payment of
         $14,300 for the note outstanding as of December 31, 2007 and loaned
         $11,350 to us during 2007                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 11,350    | 14,300   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|A note payable to Marco Venegas, our CFO of Golden Eagle International
         Inc. Bolivia, which as outstanding as of December 31, 2007 and is carried
         as a related party payable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 10,000    | -        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|A note payable to Tracy Madsen, our Chief Financial Officer, at 0%
         interest. Funds loaned to us during the year totaled $12,000 with
         repayments of $9,500.  Mr. Madsen was repaid $2,500 during January of
         2008.  During 2007 Mr. Madsen loaned an additional $121,000 to the company
         and received payments of $52,500 leaving a balance of $71,000 due on
         December 31, 2007.  This note carries an interest rate of 10% and is
         secured by the Gold Bar mill and plant.  This note is carried as related
         party payable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 71,000    | -2,500   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|Convertible  debenture  to a  current  shareholder  maturing  May  2,  2007
         bearing  interest  at 7% per  annum.  Debenture  is  convertible  into  our
         restricted  common stock at $.025 per share. At this time we do not know if
         the  debenture  holder will  convert the  debenture  into common  shares or
         require  payment  of the  principal  in cash.  We have  blocked  sufficient
         shares of restricted  common stock for a  conversion.  We have extended the
         terms of this note until May 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 249,000   | 249,000  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|A convertible  note payable to Burns,  Figa & Will for legal  services,
         entered into on February 6, 2007.  This note  carries an interest  rate
         and  matures on  February  6, 2012.  The note is  convertible  into our
         common stock at $.004 per share.  On February  14,  2008,  Burns Figa &
         Will  converted  $15,000  of this note  into  3,750,000  of our  common
         shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 45,030    | -        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|On April 11, 2007, we entered into a convertible promissory note with Mr.
         Madsen with effective date of February 6, 2007. The note covered the
         payment of contractual retention bonuses payable in our common shares.
         This note was for $50,000, and has a term of 2 years, and is convertible
         into shares of our common stock at the closing price for our common stock
         on February 6, 2007, which was $.009.  As of the date of this report, this
         note has not been converted to common stock and is still outstanding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 50,000    | -        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|On April 11, 2007, we entered into a convertible  promissory  note with
         Mr. Madsen with  effective  date of February 6, 2007.  The note covered
         the payment of contractual  retention bonuses for 2004 and 2005 payable
         in our common  shares.  This note was for $50,000,  and had a term of 2
         years,  and is  convertible  into  shares  of our  common  stock at the
         closing  price for our common  stock on  February  6,  2007,  which was
         $.009.  On February 4, 2008,  Mr.  DeLozier  converted his note payable
         into 5,947,564  shares of common stock for the $50,000 note payable and
         accrued interest.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 50,000    | -        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|Total Loans and Notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 700,491   | 432,902  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|Less:  Current maturities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | (555,461) | (432,902)
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|Less:  Discount on note                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | (36,024)  | (-)      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          
|Non-current maturities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | $109,006  | $-       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |           |          

F-16

| | Deferred
salary
| | ---------------

| | As
of December 31, 2007 we owed the following officers accrued compensation that was
deferred during 2007.
| | ----------------------------------------------------------------------------------------------------------

|                              |                           |        
|----------------------------- | ------------------------- | -------
|Officer Deferred Compensation | Position                  | Amount 
|                              |                           |        
|Harlan M. (Mac) DeLozier      | VP Bolivia Administration | 25,478 
|Other employees               |                           | 29,051 
|                              |                           |        
|Total deferred salary         |                           | $54,529
|                              |                           |        

# Note E  Income
Taxes

| | We
have not recorded an income tax provision for 2007 and 2006 due to continued net
operating losses.
| | -----------------------------------------------------------------------------------------------------

| | The
following is a reconciliation of the provision for income taxes to income before income
taxes computed at the federal statutory rate of 34%.
| | ------------------------------------------------------------------------------------------------------------------------------------------------

|                                                   |              |             
|-------------------------------------------------- | ------------ | ------------
|                                                   | 2007         | 2006        
|Income tax (benefit) at the federal statutory rate | $(2,168,000) | $(1,454,000)
|State income taxes, net of federal benefits        | (31,000)     | (37,000)    
|Nondeductible expenses                             | 1,657,000    | 805,000     
|Non-U.S. taxes                                     | 193,000      | 267,000     
|Effect of net operating loss                       | 349,000      | 419,000     
|                                                   |              |             
|Net                                                | $-           | $-          
|                                                   |              |             

| | Deferred
tax assets and liabilities are as follows:
| | ---------------------------------------------------

|                    |             |            
|------------------- | ----------- | -----------
|Deferred tax asset: | 2007        | 2006       
|Net operating loss  | $3,938,560  | $3,685,940 
|Valuation allowance | (3,938,560) | (3,685,940)
|                    |             |            
|Net                 | $-          | -          
|                    |             |            

| | The
change in the deferred tax asset valuation allowance as of December 31, 2007 and 2006 is
as follows:
| | --------------------------------------------------------------------------------------------------------

|                              |              |             
|----------------------------- | ------------ | ------------
|Valuation allowance:          | 2007         | 2006        
|Beginning valuation allowance | $(3,685,940) | $(3,304,120)
|Change in allowance           | 252,620      | 381,820     
|                              |              |             
|Ending valuation allowance    | $(3,938,560) | $(3,685,940)
|                              |              |             

| | The
valuation allowance has been established due to the uncertainty of future taxable income,
which is necessary to realize the benefits of the net operating loss (NOL)
carry forward. We had NOLs of approximately $9.7million and $9.3 million at December 31,
2007 and 2006, respectively, which expire in 2008 through 2028. These NOLs are subject to
annual utilization limitations due to prior ownership changes.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-17

# Note F 
Stockholders Equity

| | Common
Stock
| | ------------

| | During
2006, 30,004,879 shares of common stock were sold to various individuals in a private
placement at prices ranging from $.0075 to $.013 per share for total proceeds of
$287,341. During 2006, 12,308,063 shares of common stock were granted to various
individuals for services valued at the publicly traded stock prices on the day of grant
ranging from $.012 to $.0145 for total value of $242,276. During 2006, 2,999,530 shares
of common stock were granted to various individuals and companies for mineral exploration
and development services valued at the publicly traded stock prices on the day of grant
ranging from $.01767 to $.03433 for total value of $80,750.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During
2007, 10,000,000 shares of common stock were granted to various individuals for services
valued at the publicly traded stock prices on the day of grant ranging from $.008 to
$.011 for total value of $95,000.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Stock
Compensation Plan
| | -----------------------

| | On
October 31, 2007 we filed an S-8 registration statement with the SEC to issue up to 20
million shares at the direction of the Board of Directors for compensation payable to
employees and consultants (not including officers, directors or others deemed to be
insiders) by issuing shares of common stock or options to purchase common stock.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Preferred
stock
| | ---------------

| | We
issued 1,988,599 shares of Series B Preferred Stock on December 29, 2006 in exchange for
debt. During the first quarter of 2007, we issued 461,301 shares of Series B Preferred
Stock for cash from investors and 12,103 shares of Series B Preferred Stock to 9 employees
for services. During the second quarter of 2007 we issued 963,960 shares of Series B
Preferred Stock for cash and for the conversion of debt. During the third quarter of 2007
we issued 130,041 shares of our Series B Preferred Stock for cash and the conversion of
existing debt and accrued interest. A total of 3,556,004 shares of Series B have been
issued as of December 31, 2007. This preferred stock has conversion rights that allow the
holders to convert each Series B preferred share into 250 restricted shares of our common
stock. On September 14, 2007 at a special meeting of our shareholders, our shareholders
approved the increase of our authorized common shares to 2,000,000,000 shares. On
September 18, 2007 we amended our articles of incorporation to reflect the increase in
authorized common shares to 2,000,000,000 shares. At the time the articles of
incorporation were amended we had sufficient common shares available in which to convert
all of our outstanding Series B Preferred Shares to common shares. As of April 14, 2008,
96% or 3,431,002 of the outstanding Series B shares had been converted into 857,750,500
common shares, leaving 125,002 left to convert into 31,250,500 common shares. We currently
have 4,374,998 Series B shares available for issue.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | We
relied upon Sections 4(2) and 4(6) of the Securities Act of 1933, as amended
(Securities Act) for the offer and sale. We believed that Sections 4(2) and
4(6) were available because the offer and sale did not involve a public offering, there
was no general solicitation or general advertising involved in the offer or sale and the
purchaser was an accredited investor. We placed restrictive legends on the certificates
representing these securities stating that the securities were not registered under the
Securities Act and are subject to restrictions on their transferability and resale.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Derivative
liability
| | --------------------

| | Due
to the fact to no common shares were available for conversion at the time the Series B
Preferred shares were issued, we classified these preferred shares as a derivative
liability of $3,556,004, rather than equity. Additionally, the preferred shares conversion
rate was at a discount on the date the preferred shares were issued. The market price on
the date of issuance ranged from $.008 per share to $.027 per share. If the Series B
preferred shares were converted on that same date they would have had a conversion value
of $.004 per common share. As this resulted in a beneficial conversion to the market rate
for the Series B preferred shares, the accounting rules of beneficial conversion applied.
As a result, we are required to expense the difference between the conversion price and
the market price as a financing expense. The off-setting entry is also carried as a
derivative liability in the amount of $6,639,786. As there is no time limit or period
designated for the conversion of the preferred shares, the entire amount of the beneficial
conversion is taken in the year incurred. The total amount of the derivative liability was
$10,195,790 after periodic reevaluation to market price pursuant to EITF-0019. On September 14, 2007, at a special meeting of our shareholders, our
shareholders approved the increase of our authorized common shares to 2,000,000,000
shares. On September 18, 2007, we amended our articles of incorporation to reflect the
increase in authorized common shares to 2,000,000,000 shares. At the time the articles of
incorporation were amended we had sufficient common shares available in which to convert
all of our outstanding Series B Preferred Shares to common shares. As common shares were
available for conversion the entire amount of the derivative liability of $10,195,790 was
transferred to additional paid in capital which as a result caused out total
shareholders equity to increase to $4,665,738 as of December 31, 2007. As of March
11, 2008, 96% of the outstanding Series B shares had been converted to common shares,
leaving 4,374,998 Series B shares available for issue.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-18

# Note G  Related
Party Transactions

| | From
1997 through July 31, 2002, we made cumulative unsecured net advances to our president. As
of December 31, 2007, the outstanding balance of these advances totaled $276,783. However,
as of December 31, 2007, we also owed our president $276,783 of unpaid salary. Both
amounts have been reduced by offsetting amounts, which the president has recognized as
compensation at $60,000 each year in a cashless bonus and forgave $60,000 in accrued
salary each year. These notes net each other out and are not carried on the balance sheet
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
2003, we purchased the Buen Futuro property from a relative of our consultant and
principal consulting geologist.
| | --------------------------------------------------------------------------------------------------------------------

| | Our
officers and directors made the following loans to the company during 2007;
| | -------------------------------------------------------------------------------

|     |                       |             |             |                                 
|---- | --------------------- | ----------- | ----------- | --------------------------------
|Date | Affiliated Lender     | Loan Amount | (Repayment) | Outstanding Balance at Year end 
|     |                       |             |             |                                 
|     |                       |             |             |                                 
|2007 | Terry Turner          | $245        | $(345)      | $-                              
|     | Harlan (Mac) DeLozier | 11,350      | (14,300)    | 11,350                          
|     | Tracy Madsen          | 121,000     | (52,500)    | 71,000                          
|     | Marco Venegas         | 10,000      | -           | 10,000                          
|     | Total                 | $142,595    | $(67,145)   | $92,350                         
|     |                       |             |             |                                 
|2006 | Kevin Pfeffer(A)      | $-          | $-          | $                        135,000
|     | Terry Turner          | 9,100       | (9,000)     | 100                             
|     | Harlan (Mac) DeLozier | 14,300      | --          | 14,300                          
|     | Tracy Madsen          | 12,000      | (9,500)     | 2,500                           
|     | Total                 | $35,400     | $(9,500)    | $151,900                        

| | (A) | Mr. Pfeffer resigned from the Board of Directors on December 4, 2006. Mr.
          Pfeffer also no longer owns more than 10% of our outstanding stock and as such
          is no longer considered an affiliate. The $135,000 debt owed to Mr. Pfeffer was
          converted to common stock and discharged in a settlement agreement dated January
          25, 2008 and the outstanding debt as of the date of this report is $0.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Note H 
Commitments and Contingencies

F-19

| | Office
Leases
| | -------------

| | Our
executive offices in Salt Lake City, Utah are located 9661 South 700 East, Salt Lake City,
Utah 84070. This suite of offices consists of four executive offices, reception space,
filing areas and copy and faxing facilities. We pay $1,507 per month on a three-year,
renewable lease that expires in July 2008. Our lease, however, does allow us to terminate
at the end of one year for a $2,790 penalty and at the end of year two for a $1,507
penalty as such our current obligation is $1,507.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | We
also lease 150 square meters of office space in Santa Cruz, Bolivia, which we consider our
Bolivian headquarters. This lease, which expires December 31, 2008, is for $500per month.
Additionally we lease a warehouse in Santa Cruz, Bolivia totaling 360 square meters for
$1620 per month, which expires on August 14, 2008 Prior to 2006 we leased office space in
La Paz, Bolivia as our Bolivian headquarters. During 2006 we closed our last remaining
office space in La Paz and moved all Bolivian administrative activities to Santa Cruz,
Bolivia.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Our
leases are summarized as follows:
| | -------------------------------------

|                              |                   |                   |             
|----------------------------- | ----------------- | ----------------- | ------------
|Location                      | Size              | Lease Expiration  | Monthly rent
|                              |                   |                   |             
|Salt Lake City, UT            | 1,183 square feet | July 31, 2008     | $1,507      
|Santa Cruz, Bolivia           | 150 square meters | December 31, 2008 | 500         
|Warehouse Santa Cruz, Bolivia | 360 square meters | August 14, 2008   | 162         
|                              |                   |                   |             
|                              |                   |                   | $2,169      
|                              |                   |                   |             

| | The
following schedule shows the composition of total remaining commitments for office leases.
| | ----------------------------------------------------------------------------------------------

|                          |       
|------------------------- | ------
|Years ending December 31, |       
|2008                      | $8,803
|2009                      | -     
|2010                      | -     
|2011                      | -     
|thereafter                | -     
|                          |       
|Total                     | $8,803

| | Rent
expense for the years ended December 31, 2007 and 2006 was approximately $25,672 and
$26,169 respectively.
| | ---------------------------------------------------------------------------------------------------------------

| | Other
CommitmentsUnder
our agreement with the seller of Buen Futuro, we agreed to maintain an exploration program
to replace mineral reserves as they are depleted through mining for as long as the
potential for feasible mineral reserves continues on the ore deposits found within the
Buen Futuro concession. We also agreed to invest $1 million in exploration of Buen Futuro
by 2006. We have expended approximately $140,000 under the agreement. Also in the
agreement, we committed to commence mineral production on the Buen Futuro concession by
May 23, 2005, and to expend a minimum of $2,000,000 to initiate that production. We
believe the purchase of the Gold Bar mill and plant during 2004 and 2005, which was
recorded in the amount of $3,980,000, satisfies this commitment, if and when we ultimately
commence production at Buen Futuro. On May 20, 2005 we entered into an amended agreement
with the seller whereby we agreed to pay a $1,500 per month production penalty if we were
not in production by November 23, 2005 and a $3,000 per month production penalty if we
were not in production by November 26, 2006. We also agreed to pay a geologist consulting
fee of $3,000 per month in cash and $2,000 per month in stock for 60 months. This
agreement will expire on May 31, 2008.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
order to relocate the Gold Bar mill and plant to Buen Futuro and to develop Buen Futuro to
the point it can begin production, we estimate we will need to raise and spend
approximately $10,000,000. At this point in time we have no immediate plans to return our
Cangalli mine to full production. If and when we are able to recommence operations at
Cangalli, we estimate the costs to be approximately $300,000 to $500,000.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-20

# Note I 
Shareholders Meeting and Amendment of Articles of Incorporation

| | On
September 14, 2007, at a special meeting of shareholders held in Salt Lake City, Utah our
shareholders approved an amendment to our Articles of Incorporation to increase the our
authorized common stock from 800,000,000 shares to 2,000,000,000 shares. On September 18,
2007 we filed Articles of Amendment to our Articles of Incorporation increasing our
authorized common stock with the Colorado Secretary of State, which amendment became
effective immediately. The amendment does not affect the number of authorized shares of
preferred stock and was disclosed in our proxy statement for that meeting.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | At
the September 14, 2007 special meeting of shareholders, two proposals were submitted to
the shareholders for approval as set forth in our definitive proxy statement dated August
10, 2007:
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|   |                                                                                                                                                                                                                
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1. | An amendment to our Articles of Incorporation to increase the number of shares of common stock we are authorized to issue from eight hundred million (800,000,000) shares to two billion (2,000,000,000) shares
|   |                                                                                                                                                                                                                
|2. | To ratify the appointment of Chisholm, Bierwolf & Nilson as our Independent Registered Public Accounting Firm for the fiscal year ending December 31, 2006.                                                    

| | There
was no solicitation contrary to Golden Eagle International's proxy statement.
| | -----------------------------------------------------------------------------------

| | As
of the record date, August 2, 2007, there were 789,999,990 shares of our common stock
issued and outstanding and          3,425,963 shares of our Series B Contingent
Convertible Preferred Stock issued and outstanding. The holders of record of
         437,162,924 shares of Common Stock were present in person or represented by
proxy at the meeting. Additionally, the holders          of record of shares of Series B
Contingent Convertible Preferred Stock entitled to 3,314,918 were present in person or
         represented by proxy at the meeting, which constituted a quorum. (Each share of
the Series B Contingent Convertible          Preferred Stock is entitled to 250 votes,
and is further entitled to vote with the common stock on all matters presented for
         shareholder approval.) The votes present at the meeting represented
approximately 77% of the votes attributable to shares of          voting stock
outstanding and entitled to vote at the meeting.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | At
the meeting, the shareholders approved both proposals, with the votes being cast as
follows:
| | -----------------------------------------------------------------------------------------------

|                                                                                 |               |            |           
|-------------------------------------------------------------------------------- | ------------- | ---------- | ----------
|                                                                                 | For           | Against    | Abstain   
|Amendment to Increase Authorized Capital                                         | 1,185,524,537 | 58,001,942 | 22,366,165
|                                                                                 |               |            |           
|Ratification of Chisholm, Bierwolf & Nilson for the year ended December 31, 2006 | 1,231,609,483 | 9,032,430  | 25,250,731

# Note J  Subsequent
Events

| | Between
January 1, 2008, and the date of this filing, On February 14, 2008, seven of our Series B
Convertible Preferred shareholders had converted an additional 220,960 Series B Preferred
shares into 55,240,000 restricted common shares.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-21

| | On
January 25, 2008 we entered into two agreements with Kevin K. Pfeffer (Mr.
Pfeffer), which became effective February 1, 2008 based on certain conditions
subsequent being met. Mr. Pfeffer is a former director in Golden Eagle International,
Inc., having served on our board of directors from January 23, 2003 through December 4,
2006. The two subject agreements settle any and all outstanding debts that we had with Mr.
Pfeffer, as well as any and all outstanding allegations, claims, disputes and
controversies. The first agreement was titled, Settlement and Release
Agreement. Terry C. Turner (Mr. Turner), our President, Chief Executive
Officer and Chairman of the Board, was also a party to this agreement. In this agreement
Mr. Turner, Mr. Pfeffer and we agreed to the following: a. That Mr. Turner and we would
dismiss with prejudice our case alleging certain causes of action against Mr. Pfeffer
filed in the Federal District Court for Utah, Central Division, on September 5, 2007
titled, Golden Eagle International, Inc. and Terry C. Turner v. Kevin K. Pfeffer,
2:07-CV-662-TC (D.Utah; 2007). This voluntary dismissal was filed on January 28, 2008 and
was acknowledged by the Court on January 29, 2008; b. Mr. Turner and we also agreed to
release and hold Mr. Pfeffer harmless regarding any and all allegations, claims, disputes
and controversies between the parties, and entered into a covenant not to sue Mr. Pfeffer
or otherwise take any action to harm him or his reputation. c. Mr. Pfeffer agreed to
release and hold Mr. Turner and us harmless regarding any and all allegations, claims,
disputes and controversies between the parties, and entered into a covenant not to sue Mr.
Turner or us or otherwise take any action to harm Mr. Turner or us or our reputation. We
acknowledged certain sums that we owed to Mr. Pfeffer, including a promissory note dated
June 6, 2005 for an operating loan that Mr. Pfeffer had made to us, accumulated interest
and penalties on that note, and expenses that Mr. Pfeffer had incurred while serving on
our board of directors, which totaled $230,434.37, which we agreed to convert into
57,608,593 shares of our common stock. e. All parties agreed to a two-year Quiet
Period in which all parties will cease to comment, publicly or privately, in
Internet forums and blogs, or any other written or verbal venue, regarding any of the
other parties. The second agreement was titled, Stock Purchase Agreement. In
this agreement we agreed with Mr. Pfeffer to the following: a. All of the terms and
conditions of the Settlement and Release Agreement set out above, as well as the agreement
for the actual issuance to Mr. Pfeffer of 57,608,593 shares of our common stock in
exchange for $230,434.37 in debt that we owed to Mr. Pfeffer pursuant to exemptions from
registration for accredited investors found in Sections 4(2) and 4(6) of the Securities
Act of 1933.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
January 31, 2008, we sold 1,777,778 shares of our common stock to David Harkrider ,for
cash, at $0.0045 per share or an aggregate of $8,000.
| | -----------------------------------------------------------------------------------------------------------------------------------------------

| | On
February 4, 2008, we issued 5,997,564 shares of our common stock to Harlan (Mac) DeLozier
a Bolivian resident at $0.009 per share or an aggregate of $53,978.08. The shares were
issued for a convertible note payable to Mr. DeLozier dated February 6, 2007 for services
provided to the company.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
February 5, 2008 we entered into a settlement agreement with CEOcast, for the payment of
trade payable from March 2005 . Rachel Glicksman was issued 2,000,000 shares of our common
stock in exchange for a payable totaling $17,600 including principal and interest at .0088
per share.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
February 5, 2008 we entered into a settlement agreement with RAF y CIA, LLC, which had
acquired the debt owned by Tio Rico Ltd. which originally was for a note to purchase a
company aircraft. RAF y CIA, LLC was issued 5,137,231 shares of our common stock in
exchange for a note payable totaling $51,372 including principal and interest. We also
issued 1 million shares of our common stock as a settlement fee. Additionally we issued
2,180,000 shares of our common stock to RAF y CIA, LLC in exchange for $21,800 in debt
which we originally owed as an account payable to Redstone Ltd. dating back to June 30,
2005.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
February 5, 2008, we sold 6,500,000 shares of our common stock to Dewey L. Williams, The
Dewey L. Williams Profit Sharing Plan & Trust and the Dewey Williams Roth IRA for
cash, at $0.005 per share or an aggregate of $32,500.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
February 15, 2008, we issued 3,750,000 shares of our common stock to Burns, Figa &
Will at $0.004 per share or an aggregate of $15,000. The shares were issued for a
convertible note payable to Burns, Figa & Will dated January 16, 2007 for legal
services provided to the company which were past due.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
February 26, 2008, we sold 3,000,000 shares of our common stock to Stuart Rubin, for cash,
at $0.005 per share or an aggregate of $15,000.
| | ---------------------------------------------------------------------------------------------------------------------------------------------

F-22

| | On
March 14, 2008, we issued 2,750,361 shares of our common stock to Dr.Michael Biste, a
Bolivian resident, at an average price of $0.013 per share or an aggregate of $36,000 for
geological services provided under a contractual agreement.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 24, 2008, we sold 11,156,250 shares of our common stock to Dewey Williams, The Dewey
L. Williams Profit Sharing Plan & Trust for cash at $0.004 per share or an aggregate
of $44,625.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we issued 12,101,560 shares of our common stock to Marco Venegas, an
employee residing in Bolivia, for accrued wages and for a loan repayment, at $0.004 per
share or an aggregate of $47,196.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we issued 1,380,371 shares of our common stock to Marigen Rocha, an
employee residing in Bolivia, for accrued wages, at $0.004 per share or an aggregate of
$5,383.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we issued 594,781 shares of our common stock to Carol Limachi, an employee
residing in Bolivia, for accrued wages, at $0.004 per share or an aggregate of $2,320.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we issued 537,254 shares of our common stock to Wilson Garcia, an employee
residing in Bolivia, for accrued wages, at $0.004 per share or an aggregate of $2,095.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we issued 537,960 shares of our common stock to Juan Calderon, an employee
residing in Bolivia, for accrued wages, at $0.004 per share or an aggregate of $2,098.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we issued 416,828 shares of our common stock to Julio Mamani, an employee
residing in Bolivia, for accrued wages, at $0.004 per share or an aggregate of $1,626.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we sold 10,205,128 shares of our common stock to Miguel Simon Guardia, a
resident of Bolivia, at $0.0039 per share or an aggregate of $39,800.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
March 31, 2008, we issued 3,205,128 shares of our common stock to Tracy Madsen, an officer
of the company, for accrued wages under a contractual obligation, at $0.0078 per share or
an aggregate of $25,000.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
April 11, 2008, we sold 10,205,128 shares of our common stock to Edmundo Arauz, a resident
of Bolivia, for cash at $0.00345 per share or an aggregate of $262,974.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
every case above we relied upon Sections 4(2) and 4(6) of the Securities Act for the
offer and sale. In ten cases we also relied on Regulation S promulgated under the
Securities Act regarding non-residents of the United States. We believed that Sections
4(2) and 4(6) were available because the offer and sale did not involve a public
offering, there was no general solicitation or general advertising involved in the offer
or sale and the purchaser was an accredited investor. Our reliance on Regulation S was
based on the ten of the purchasers were non-residents of the United States and reside in
Bolivia. We placed restrictive legends on the certificates representing these securities
stating that the securities were not registered under the Securities Act and are subject
to restrictions on their transferability and resale and that no common shares, at the
time of sale, were available for conversion.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-23

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