U.
        S.
        SECURITIES AND EXCHANGE COMMISSION
 Washington,
        D.C. 20549


**FORM
          10-QSB/A**
  [X]  QUARTERLY
        REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
        1934
 
 For
        the
        quarterly period ended June 30, 2006
 
 [  
        ]  TRANSITION
        REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
        1934
 
 For
        the
        transition period from ____________ to____________
 
 Commission
        File No. 333-85414
 
 BULLION
        RIVER GOLD CORP.
 (Name
        of
        Small Business Issuer in its Charter)
 
 NEVADA
              
              98-0377992(State
                  or other jurisdiction of
              
              (I.R.S.
                  Employer I.D. No.)incorporation
                  or organization)
 
 3500
        Lakeside Court, Suite 200
 Reno,
        Nevada 89509
 (Address
        of Principal Executive Office)
 
 Issuer's
        Telephone Number, including Area Code: (775)324-4881
 
 Check
        whether the Issuer (1) has filed all reports required to be filed by Sections
        13
        or 15(d) of the Exchange Act during the past 12 months (or for such shorter
        period that the Issuer was required to file such reports), and (2) has been
        subject to such filing requirements for the past 90 days.
 
 (1)
        Yes
        [X]  No
        [   ]        (2)
        Yes [X] No
        [   ]
 
 Indicate
        by check mark whether the Issuer is a shell company (as defined by Rule 12b-2
        of
        the Exchange Act) Yes [   ] No [X]
 
 Applicable
        Only to Issuers Involved in Bankruptcy
 Proceedings
        During the Preceding Five Years
 
 Not
        applicable.
 
 Applicable
        Only to Corporate Issuers
 
 Indicate
          the number of shares outstanding of each of the Issuer's classes of common
          stock, as of the latest practicable date: September 20, 2006 -
          58,142,970
 
 Transitional
        small business disclosure format (check one): Yes [   ] No
        [X]





**Item
      1. Financial Statements.**




The
      Financial Statements of the Registrant required to be filed with this 10-QSB
      Quarterly Report were prepared by management, and commence on the following
      page, together with Related Notes. In the opinion of management, the
      Financial Statements fairly present the financial condition of the Registrant.








**Bullion
      River Gold Corp.**


**(An
      Exploration Stage Company)**


**Consolidated
      Balance Sheets**


**As
      of June 30, 2006 and December 31, 2005**




**June
                  30**
              
              **December
                  31****2006**
              
              **2005**(Unaudited)**ASSETS**Current
                  Assets:Cash
              
              $
              288,741
              
              $
              124,788Prepaids
                  & Other Current
              
              
              322,738
              
              
              394,396Inventory
              
              
              110,008
              
              
              66,404Total
                  Current Assets
              
              
              721,487
              
              
              585,588Fixed
                  Assets:Fixed
                  Assets
              
              
              2,329,601
              
              
              586,825Less
                  Accumulated Depreciation
              
              
              (266,038
              )
              
              (102,676
              )Total
                  Fixed Assets
              
              
              2,063,563
              
              
              484,149Other
                  Assets:Deposits
              
              
              318,523
              
              
              440,176Total
                  Other
              
              
              318,523
              
              
              440,176**Total
                  Assets**
              
              **$**
              **3,103,573**
              
              **$**
              **1,509,913****LIABILITIES
                  & SHAREHOLDERS' EQUITY**Current
                  Liabilities:Accounts
                  Payable and Accruals
              
              $
              841,028
              
              $
              309,640Other
                  Current Liabilities
              
              
              -
              
              
              170,758Loans
                  From Related Parties
              
              
              -
              
              
              13,453Current
                  Portion of Capital Lease Obligations
              
              
              124,371
              
              
              63,216Total
                  Current Liabilities
              
              
              965,399
              
              
              557,067Long
                  Term Liabilities:Long
                  Term Capital Lease Obligations
              
              
              208,395
              
              
              128,281Long
                  Term Reclamation Obligations
              
              
              106,070
              
              
              103,041Total
                  Long Term Liabilities
              
              
              314,465
              
              
              231,322Total
                  Liabilities
              
              
              1,279,864
              
              
              788,389Shareholders'
                  EquityCommon
                  StockAuthorized
                  200,000,000 common shares, $0.001 par value.Issued
                  and outstanding 56,121,881 and 39,243,581, respectively
              
              
              56,122
              
              
              39,244Additional
                  Paid In Capital
              
              
              16,235,677
              
              
              8,825,579Shares
                  Subscribed
              
              
              60,000
              
              
              387,500Deficit
                  Accumulated During The Exploration Stage
              
              
              (14,528,090
              )
              
              (8,530,799
              )Total
                  Shareholders' Equity
              
              
              1,823,709
              
              
              721,524**Total
                  Liabilities & Shareholders' Equity**
              
              **$**
              **3,103,573**
              
              **$**
              **1,509,913**
  The
        accompanying notes are an integral part of these consolidated financial
        statements.


F-1




**Bullion
      River Gold Corp.**


**(An
      Exploration Stage Company)**


**Consolidated
      Statements of Operations**


**(Unaudited)**




Three
                  Months Ended
                June
                  30
              
              Six
                  Months Ended
                June
                  30
              
              From
                  Inception
                June
                  29, 20012006
              
              2005
              
              2006
              
              2005
              
              to
                  June 30, 2006Operating
                  Revenue:
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Operating
                  Expenses:Exploration
              
              
              2,384,972
              
              
              1,172,317
              
              
              3,867,296
              
              
              2,229,651
              
              
              9,045,232Mill
                  Operations
              
              
              472,098
              
              
              -
              
              
              504,859
              
              
              -
              
              
              504,859Salaries
                  & Wages
              
              
              258,743
              
              
              207,027
              
              
              428,660
              
              
              346,091
              
              
              1,031,851Payroll
                  Burden
              
              
              57,352
              
              
              26,074
              
              
              107,894
              
              
              43,537
              
              
              207,292Employee
                  Related
              
              
              111,479
              
              
              1,230
              
              
              142,440
              
              
              2,548
              
              
              174,291Professional
                  Fees
              
              
              88,259
              
              
              116,413
              
              
              234,212
              
              
              346,063
              
              
              1,193,211Consulting
              
              
              19,589
              
              
              37,873
              
              
              27,771
              
              
              96,548
              
              
              384,739Office
              
              
              41,734
              
              
              14,870
              
              
              60,293
              
              
              31,791
              
              
              154,262Travel
                  Related
              
              
              55,664
              
              
              59,836
              
              
              116,840
              
              
              126,310
              
              
              414,175Licenses
                  & Fees
              
              
              458
              
              
              2,660
              
              
              1,211
              
              
              3,258
              
              
              44,531Investor
                  Communications
              
              
              109,111
              
              
              67,201
              
              
              225,878
              
              
              142,286
              
              
              769,141Insurance
              
              
              14,288
              
              
              7,235
              
              
              27,722
              
              
              28,978
              
              
              108,912Rent
              
              
              24,165
              
              
              12,971
              
              
              37,191
              
              
              26,058
              
              
              108,925Utilities
              
              
              24,632
              
              
              10,149
              
              
              37,003
              
              
              13,476
              
              
              78,889Bank
                  Charges
              
              
              778
              
              
              1,912
              
              
              2,254
              
              
              7,627
              
              
              19,424Miscellaneous
              
              
              1
              
              
              25,579
              
              
              1,598
              
              
              25,579
              
              
              (27,920
              )Accretion
              
              
              1,499
              
              
              -
              
              
              3,029
              
              
              -
              
              
              5,069Depreciation
              
              
              100,423
              
              
              12,314
              
              
              164,034
              
              
              23,835
              
              
              266,710Total
                  Operating Expenses
              
              
              3,765,245
              
              
              1,775,661
              
              
              5,990,185
              
              
              3,493,636
              
              
              14,483,593Loss
                  From Operations
              
              
              (3,765,245
              )
              
              (1,775,661
              )
              
              (5,990,185
              )
              
              (3,493,636
              )
              
              (14,483,593
              )Other
                  Income (Expense):Non-Operating
                  Income
              
              
              4,861
              
              
              -
              
              
              14,875
              
              
              -
              
              
              73,809Gain
                  on extinguishment of debt
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              32,215Interest
                  Expense
              
              
              (12,271
              )
              
              -
              
              
              (22,401
              )
              
              -
              
              
              (93,989
              )Other
                  Non-Operating
              
              
              1,608
              
              
              (747
              )
              
              420
              
              
              (1,600
              )
              
              (56,532
              )Total
                  Other Income (Expense)
              
              
              (5,802
              )
              
              (747
              )
              
              (7,106
              )
              
              (1,600
              )
              
              (44,497
              )Net
                  Loss Before Income Taxes
              
              
              (3,771,047
              )
              
              (1,776,408
              )
              
              (5,997,291
              )
              
              (3,495,236
              )
              
              (14,528,090
              )Income
                  Taxes
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -**NET
                  LOSS FOR PERIOD**
              
              **$**
              **(3,771,047**
              **)**
              **$**
              **(1,776,408**
              **)**
              **$**
              **(5,997,291**
              **)**
              **$**
              **(3,495,236**
              **)**
              **$**
              **(14,528,090**
              **)**BASIC
                  AND DILUTEDLOSS
                  PER SHARE
              
              $
              (0.07
              )
              $
              (0.06
              )
              $
              (0.12
              )
              $
              (0.12
              )WEIGHTED
                  AVERAGE SHARESOUTSTANDING
              
              
              51,184,551
              
              
              31,748,791
              
              
              48,856,664
              
              
              30,237,184The
                  accompanying notes are an integral part of these consolidated financial
                  statements.


F-2


**BULLION
      RIVER GOLD CORP.**


**CONSOLIDATED
      STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
      (LOSS)**


**For
      the period from Inception June 29, 2001 to June 30, 2006**




**Deficit****Accumulated**
              
              **Accumulated****Common
                  Stock Issued**
              
              **Additional**
              
              **Common
                  Shares**
                **Subscribed**
              
              **During
                  the**
              
              **Other****Number
                  of**
              
              
              
              **Paid
                  in**
              
              **Number
                  of**
              
              
              
              **Development**
              
              **Comprehensive****Shares**
              
              **Amount**
              
              **Capital**
              
              **Shares**
              
              **Amount**
              
              **Stage**
              
              **Income
                  (Loss)**
              
              **Total****Balance,
                  June 29, 2001**
              
              
              -
              
              $
              -
              
              $
              -
              
              
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Issuance
                  of common sharesfor
                  cash, August 8, 2001
              
              
              1,000,000
              
              
              1,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,000Issuance
                  of common sharesfor
                  cash, December 6, 2001
              
              
              1,400,000
              
              
              1,400
              
              
              12,600
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              14,000Net
                  loss, for the twelve month periodended,
                  December 31, 2001
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (1,000
              )
              
              -
              
              
              (1,000
              )**Balance,
                  December 31, 2001**
              
              
              **2,400,000**
              
              
              **2,400**
              
              
              **12,600**
              
              
              **-**
              
              
              **-**
              
              
              **(1,000**
              **)**
              
              **-**
              
              
              **14,000**Issuance
                  of common shares for cash,November
                  26 to December 16, 2002
              
              
              208,500
              
              
              208
              
              
              20,642
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              20,850Net
                  loss, for the twelve month periodended,
                  December 31, 2002
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (43,348
              )
              
              -
              
              
              (43,348
              )**Balance,
                  December 31, 2002**
              
              
              **2,608,500**
              
              
              **2,608**
              
              
              **33,242**
              
              
              **-**
              
              
              **-**
              
              
              **(44,348**
              **)**
              
              **-**
              
              
              **(8,498**
              **)**Issuance
                  of common sharesfor
                  cash, January 7, 2003
              
              
              95,000
              
              
              95
              
              
              9,405
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              9,500Issuance
                  of common sharesfor
                  cash, January 9, 2003
              
              
              80,000
              
              
              80
              
              
              7,920
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              8,000Issuance
                  of common sharesfor
                  cash, February 7, 2003
              
              
              110,000
              
              
              110
              
              
              10,890
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              11,000Issuance
                  of common sharesfor
                  cash, February 18, 2003
              
              
              106,500
              
              
              107
              
              
              10,543
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              10,650Commons
                  shares cancelled,December
                  2, 2003
              
              
              (2,000,000
              )
              
              (2,000
              )
              
              2,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Issuance
                  of nine for one commonstock
                  dividend, December 9, 2003
              
              
              9,000,000
              
              
              9,000
              
              
              (9,000
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Net
                  loss, for the twelve month periodended,
                  December 31, 2003
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (101,215
              )
              
              -
              
              
              (101,215
              )**Balance,
                  December 31, 2003**
              
              
              **10,000,000**
              
              
              **10,000**
              
              
              **65,000**
              
              
              **-**
              
              
              **-**
              
              
              **(145,563**
              **)**
              
              **-**
              
              
              **(70,563**
              **)**Issuance
                  of one and one half for onecommon
                  stock dividend, January 13, 2004
              
              
              15,000,003
              
              
              15,000
              
              
              (15,000
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Issuance
                  of common shares forfinders
                  fee, March 18, 2004
              
              
              25,000
              
              
              25
              
              
              28,725
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              28,750Issuance
                  of common shares forconsulting
                  fees, March 18, 2004
              
              
              30,000
              
              
              30
              
              
              34,470
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              34,500Issuance
                  of common shares for propertyoption
                  payment, March 18, 2004
              
              
              30,000
              
              
              30
              
              
              34,470
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              34,500Common
                  stock subscribed January 19, 2004
              
              
              -
              
              
              -
              
              
              -
              
              
              125,000
              
              
              125,000
              
              
              -
              
              
              -
              
              
              125,000Common
                  stock subscribed March 25, 2004
              
              
              -
              
              
              -
              
              
              -
              
              
              850,000
              
              
              850,000
              
              
              -
              
              
              -
              
              
              850,000Issuance
                  of 850,000 units for cash,Reg
                  S, April 15, 2004
              
              
              850,000
              
              
              850
              
              
              849,150
              
              
              (850,000
              )
              
              (850,000
              )
              
              -
              
              
              -
              
              
              -Issuance
                  of 125,000 units for cash,Reg
                  S, April 30, 2004
              
              
              125,000
              
              
              125
              
              
              124,875
              
              
              (125,000
              )
              
              (125,000
              )
              
              -
              
              
              -
              
              
              -Issuance
                  of common shares forconsulting
                  fees, July 20, 2004
              
              
              30,000
              
              
              30
              
              
              30,870
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              30,900Issuance
                  of 50,000 units for cash,Reg
                  S, July 20, 2004
              
              
              50,000
              
              
              50
              
              
              49,950
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              50,000Issuance
                  of 200,000 units for debt,Reg
                  S, September 16, 2004
              
              
              200,000
              
              
              200
              
              
              199,800
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              200,000Issuance
                  of 93,334 units for debt,Reg
                  S, September 29, 2004
              
              
              93,334
              
              
              94
              
              
              69,906
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              70,000


(CONTINUED
      ON FOLLOWING PAGE)


The
      accompanying notes are an integral part of these consolidated financial
      statements


F-3


**BULLION
          RIVER GOLD CORP.**
 **CONSOLIDATED
          STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
          (LOSS)**
 **For
          the period from Inception June 29, 2001 to June 30, 2006**
  **Deficit****Accumulated**
                  
                  **Accumulated****Common
                      Stock Issued**
                  
                  **Additional**
                  
                  **Common
                      Shares Subscribed**
                  
                  **During
                      the**
                  
                  **Other****Number
                      of**
                  
                  
                  
                  **Paid
                      in**
                  
                  **Number
                      of**
                  
                  
                  
                  **Development**
                  
                  **Comprehensive****Shares**
                  
                  **Amount**
                  
                  **Capital**
                  
                  **Shares**
                  
                  **Amount**
                  
                  **Stage**
                  
                  **Income
                      (Loss)**
                  
                  **Total**Issuance
                      of 1,000,001 units for cash,Reg
                      S, September 29, 2004
                  
                  
                  1,000,001
                  
                  
                  1,000
                  
                  
                  749,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  750,000Issuance
                      of 299,000 units for cash,Reg
                      S, November 16, 2004
                  
                  
                  299,000
                  
                  
                  299
                  
                  
                  223,951
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  224,250Issuance
                      of 183,333 units for cash,Reg
                      D, December 9, 2004
                  
                  
                  183,333
                  
                  
                  183
                  
                  
                  135,817
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  136,000Issuance
                      of 2,000 shares for finders fees,Reg
                      D, December 9, 2004
                  
                  
                  2,000
                  
                  
                  2
                  
                  
                  1,498
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  1,500Issuance
                      of 501,333 units for cash,Rule
                      144, December 29, 2004
                  
                  
                  501,333
                  
                  
                  501
                  
                  
                  317,384
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  317,885Issuance
                      of 25,000 units for cash,Reg
                      S, December 22, 2004
                  
                  
                  25,000
                  
                  
                  25
                  
                  
                  18,725
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  18,750Net
                      loss, for the twelve month periodended,
                      December 31, 2004
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (2,965,185
                  )
                  
                  -
                  
                  
                  (2,965,185
                  )Foreign
                      currency translation adjustments
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (1,186
                  )
                  
                  (1,186
                  )**Balance,
                      December 31, 2004**
                  
                  
                  **28,444,004**
                  
                  
                  **28,444**
                  
                  
                  **2,918,591**
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  **(3,110,748**
                  **)**
                  
                  **(1,186**
                  **)**
                  
                  **(164,899**
                  **)**Issuance
                      of 290,000 units for cashReg
                      D, Feb 2, 2005
                  
                  
                  290,000
                  
                  
                  290
                  
                  
                  217,210
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  217,500Issuance
                      of 50,000 units for cashReg
                      S, February 16,2005
                  
                  
                  50,000
                  
                  
                  50
                  
                  
                  37,450
                  
                  
                  -
                  
                  
                  -
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  37,500Issuance
                      of 481,000 units for cashReg
                      S, March 22, 2005
                  
                  
                  481,000
                  
                  
                  481
                  
                  
                  360,269
                  
                  
                  -
                  
                  
                  -
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  360,7503,390,599
                      Units Subscribed during Februaryand
                      March 2005
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  3,390,599
                  
                  
                  2,542,951
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  2,542,951Share
                      issue costs incurred during Februaryand
                      March 2005
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (193,330
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  (193,330
                  )Common
                      stock issued April 29, 2005
                  
                  
                  1,796,673
                  
                  
                  1,797
                  
                  
                  1,345,704
                  
                  
                  (1,796,673
                  )
                  
                  (1,347,501
                  )
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  -Common
                      stock issued May 2, 2005
                  
                  
                  1,437,236
                  
                  
                  1,437
                  
                  
                  1,076,488
                  
                  
                  (1,437,236
                  )
                  
                  (1,077,925
                  )
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  -Common
                      stock issued May 5, 2005
                  
                  
                  466,668
                  
                  
                  467
                  
                  
                  349,533
                  
                  
                  (156,690
                  )
                  
                  (117,525
                  )
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  232,475Share
                      Issue costs incurred during Q2
                  
                  
                  
                  
                  
                  
                  
                  
                  (7,600
                  )
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (7,600
                  )Common
                      stock issued October 18, 2005
                  
                  
                  1,790,000
                  
                  
                  1,790
                  
                  
                  893,210
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  895,000For
                      CashCommon
                      stock issued October 20, 2005
                  
                  
                  464,000
                  
                  
                  464
                  
                  
                  231,536
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  232,000For
                      CashCommon
                      stock subscribed October 31, 2005
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  75,000
                  
                  
                  37,500
                  
                  
                  -
                  
                  
                  -
                  
                  
                  37,500For
                      services renderedCommon
                      stock issued November 28, 2005
                  
                  
                  1,244,000
                  
                  
                  1,244
                  
                  
                  620,756
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  622,000For
                      CashCommon
                      stock issued December 16, 2005
                  
                  
                  2,780,000
                  
                  
                  2,780
                  
                  
                  1,387,220
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  1,390,000For
                      CashCommon
                      stock subscribed December 16, 2005
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  400,000
                  
                  
                  200,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  200,000For
                      CashCommon
                      stock subscribed December 29, 2005
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  50,000
                  
                  
                  25,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  25,000For
                      CashCommon
                      stock subscribed December 31, 2005
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  250,000
                  
                  
                  125,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  125,000For
                      services renderedShare
                      Issue costs incurred during Q4
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (411,458
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (411,458
                  )Foreign
                      currency translation adjustments
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  1,186
                  
                  
                  1,186Net
                      Loss for the twelve month periodended,
                      December 31, 2005
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (5,420,051
                  )
                  
                  
                  
                  
                  (5,420,051
                  )**Balance
                      December 31, 2005**
                  
                  
                  **39,243,581**
                  
                  
                  **39,244**
                  
                  
                  **8,825,579**
                  
                  
                  **775,000**
                  
                  
                  **387,500**
                  
                  
                  **(8,530,799**
                  **)**
                  
                  **-**
                  
                  
                  **721,524**
 (CONTINUED
          ON FOLLOWING PAGE)
 The
          accompanying notes are an integral part of these consolidated financial
          statements
  F-4
 **BULLION
          RIVER GOLD CORP.**
 **CONSOLIDATED
          STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
          (LOSS)**
 **For
          the period from Inception June 29, 2001 to June 30, 2006**
  **Deficit****Common
                      Shares Subscribed**
                  
                  **Accumulated**
                  
                  **Accumulated****Common
                      Stock Issued**
                  
                  **Additional**
                  
                  
                  
                  
                  
                  **During
                      the**
                  
                  **Other****Number
                      of**
                  
                  
                  
                  **Paid
                      in**
                  
                  **Number
                      of**
                  
                  
                  
                  **Development**
                  
                  **Comprehensive****Shares**
                  
                  **Amount**
                  
                  **Capital**
                  
                  **Shares**
                  
                  **Amount**
                  
                  **Stage**
                  
                  **Income
                      (Loss)**
                  
                  **Total**Common
                      stock issued January 3, 2006
                  
                  
                  450,000
                  
                  
                  450
                  
                  
                  224,550
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  225,000for
                      cash (Unaudited)Common
                      stock issued January 18, 2006
                  
                  
                  50,000
                  
                  
                  50
                  
                  
                  24,950
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  25,000for
                      cash (Unaudited)Common
                      stock issued January 19, 2006
                  
                  
                  50,000
                  
                  
                  50
                  
                  
                  24,950
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  25,000for
                      cash (Unaudited)Common
                      stock subscribed in January in exchange
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  250,000
                  
                  
                  125,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  125,000for
                      property purchase option (Unaudited)Common
                      stock issued January 23, 2006
                  
                  
                  6,644,000
                  
                  
                  6,644
                  
                  
                  3,315,356
                  
                  
                  (775,000
                  )
                  
                  (387,500
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  2,934,500for
                      cash (Unaudited)Common
                      stock issued January 23, 2006
                  
                  
                  325,000
                  
                  
                  325
                  
                  
                  162,175
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  162,500for
                      services rendered (Unaudited)Common
                      stock issued January 23, 2006 related to
                  
                  
                  2,091,294
                  
                  
                  2,091
                  
                  
                  (2,091
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -anti-dilution
                      clauses in prior offerings (Unaudited)Common
                      stock subscribed January 23, 2006
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  90,000
                  
                  
                  45,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  45,000for
                      cash (Unaudited)Common
                      stock subscribed February 8, 2006
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  100,000
                  
                  
                  50,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  50,000for
                      cash (Unaudited)Common
                      stock subscribed March 23, 2006
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  100,000
                  
                  
                  50,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  50,000for
                      cash (Unaudited)Share
                      Issue costs incurred during Q1(Unaudited)
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (365,500
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (365,500
                  )Warrants
                      issued to satisfy finders' feeobligations
                      (Unaudited)
                  
                  
                  -
                  
                  
                  -
                  
                  
                  98,808
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  98,808Common
                      stock issued May 1, 2006for
                      shares subscribed (Unaudited)
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (540,000
                  )
                  
                  (270,000
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  (270,000
                  )Common
                      stock issued May 1, 2006
                  
                  
                  555,000
                  
                  
                  555
                  
                  
                  276,945
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  277,500for
                      cash (Unaudited)Common
                      stock issued May 19, 2006
                  
                  
                  3,148,336
                  
                  
                  3,148
                  
                  
                  1,571,020
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  1,574,168for services
                      rendered (Unaudited)Common
                      stock issued May 19, 2006
                  
                  
                  32,386
                  
                  
                  32
                  
                  
                  16,161
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  16,193for
                      services rendered (Unaudited)Common
                    stock issued June 5, 2006
                  
                  
                  133,280
                  
                  
                  133
                  
                  
                  66,507
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  66,640for
                      cash (Unaudited)Common
                      stock issued June 9, 2006
                  
                  
                  715,000
                  
                  
                  715
                  
                  
                  356,735
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  357,500for
                      cash (Unaudited)Common
                      stock issued June 16, 2006
                  
                  
                  83,334
                  
                  
                  83
                  
                  
                  41,584
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  41,667for
                      cash (Unaudited)Common
                      stock issued June 20, 2006
                  
                  
                  1,500,000
                  
                  
                  1,500
                  
                  
                  748,500
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  750,000for
                      cash (Unaudited)Recalled
                      Ratchet Shares issued in Q1
                  
                  
                  (166,667
                  )
                  
                  (165
                  )
                  
                  165
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -on
                      June 26, 2006 (Unaudited)Common
                      stock subscribed June 27, 2006
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  80,000
                  
                  
                  60,000
                  
                  
                  -
                  
                  
                  -
                  
                  
                  60,000for
                      cash (Unaudited)Common
                      stock issued June 29, 2006
                  
                  
                  1,033,337
                  
                  
                  1,033
                  
                  
                  773,967
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  775,000for
                      cash (Unaudited)Common
                      stock issued June 29, 2006
                  
                  
                  234,000
                  
                  
                  234
                  
                  
                  175,266
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  175,500for
                      purchase option reduction (Unaudited)Share
                      Issue costs incurred during Q2 (Unaudited)
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (100,000
                  )
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (100,000
                  )Net
                      Loss for the three month periodended,
                      June 30, 2006 (Unaudited)
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (5,997,291
                  )
                  
                  -
                  
                  
                  (5,997,291
                  )**Balance
                      June 30, 2006**
                  
                  
                  **56,121,881**
                  
                  **$**
                  **56,122**
                  
                  **$**
                  **16,235,677**
                  
                  
                  **80,000**
                  
                  **$**
                  **60,000**
                  
                  **$**
                  **(14,528,090**
                  **)**
                  **$**
                  **-**
                  
                  **$**
                  **1,823,709**
 The
          accompanying notes are an integral part of these consolidated financial
          statements


F-5
 
  **Bullion
            River Gold Corp.**
 **(An
            Exploration Stage Company)**
 **Consolidated
            Cash Flow Statements**
 **(Unaudited)**
  **Six
                        Months Ended**
                      **June
                        30**
                    
                    **From
                        Inception,**
                      **June
                        29, 2001 to****2006**
                    
                    **2005**
                    
                    **June
                        30, 2006****CASH
                        FLOW FROM OPERATING ACTIVITIES**Net
                        Loss for the Period
                    
                    $
                    (5,997,291
                    )
                    $
                    (3,495,236
                    )
                    $
                    (14,528,090
                    )Adjustment
                        to reconcile net loss to net cashused
                        in operating activities:Depreciation
                        Expense
                    
                    
                    164,034
                    
                    
                    23,835
                    
                    
                    266,710Accretion
                        Expense
                    
                    
                    3,029
                    
                    
                    -
                    
                    
                    5,070Gain
                        on Extinguishment of Debt
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (32,215
                    )Loss
                        on other
                    
                    
                    1,188
                    
                    
                    -
                    
                    
                    1,188Common
                        Stock issued for services and related expense
                    
                    
                    316,693
                    
                    
                    -
                    
                    
                    445,343Changes
                        in operating assets and liabilities:(Increase)
                        Decrease in Prepaids & Other Current Assets
                    
                    
                    71,658
                    
                    
                    (44,564
                    )
                    
                    (322,737
                    )(Increase)
                        Decrease in Accounts Receivable
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -(Increase)
                        Decrease in Inventory
                    
                    
                    (43,604
                    )
                    
                    -
                    
                    
                    (110,008
                    )(Increase)
                        Decrease in Deposits
                    
                    
                    121,653
                    
                    
                    (71,850
                    )
                    
                    (318,523
                    )Increase
                        (Decrease) in Accounts Payable/Accrued
                    
                    
                    531,388
                    
                    
                    265,255
                    
                    
                    854,364Increase
                        (Decrease) in Other current liabilities
                    
                    
                    (170,758
                    )
                    
                    -
                    
                    
                    (98,808
                    )Increase
                        (Decrease) in Reclamation Obligation
                    
                    
                    -
                    
                    
                    -
                    
                    
                    101,000**NET
                        CASH USED IN OPERATING ACTIVITIES**
                    
                    
                    **(5,002,010**
                    **)**
                    
                    **(3,322,560**
                    **)**
                    
                    **(13,736,706**
                    **)**NET
                        CASH USED IN INVESTING ACTIVITIESPurchase
                        of fixed assets
                    
                    
                    (1,603,367
                    )
                    
                    (74,802
                    )
                    
                    (1,998,697
                    )**NET
                        CASH USED IN INVESTING ACTIVITIES**
                    
                    
                    **(1,603,367**
                    **)**
                    
                    **(74,802**
                    **)**
                    
                    **(1,998,697**
                    **)**NET
                        CASH RECEIVED IN FINANCING ACTIVITIESAdvance
                        payable
                    
                    
                    -
                    
                    
                    -
                    
                    
                    118,880Loans
                        from related parties
                    
                    
                    (13,453
                    )
                    
                    -
                    
                    
                    -Loan
                        payable
                    
                    
                    -
                    
                    
                    (15,000
                    )
                    
                    170,000Cash
                        proceeds from sale of common shares
                    
                    
                    7,799,591
                    
                    
                    3,190,246
                    
                    
                    16,878,152Cash
                        proceeds from shares subscribed
                    
                    
                    (452,500
                    )
                    
                    -
                    
                    
                    (65,000
                    )Offering
                        Costs
                    
                    
                    (564,308
                    )
                    
                    -
                    
                    
                    (1,077,888
                    )**NET
                        CASH RECEIVED FROM FINANCING ACTIVITIES**
                    
                    
                    **6,769,330**
                    
                    
                    **3,175,246**
                    
                    
                    **16,024,144**Effect
                        of exchange rate changes on cash
                    
                    
                    -
                    
                    
                    55
                    
                    
                    -**INCREASE
                        (DECREASE) IN CASH**
                    
                    
                    **163,953**
                    
                    
                    **(222,061**
                    **)**
                    
                    **288,741**CASH,
                        BEGINNING OF THE PERIOD (January 1)
                    
                    
                    124,788
                    
                    
                    273,331
                    
                    
                    -**CASH,
                        END OF PERIOD**
                    
                    **$**
                    **288,741**
                    
                    **$**
                    **51,270**
                    
                    **$**
                    **288,741**
 
 The
            accompanying notes are an integral part of these consolidated financial
            statements.
 F-6


**BULLION
      RIVER GOLD CORP.**


**(An
      Exploration Stage Company)**


**NOTES
      TO THE CONSOLIDATED FINANCIAL STATEMENTS**


**June
      30, 2006**








**NOTE
      1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION**




**NATURE
      OF OPERATIONS**


Bullion
      River Gold Corporation (“Bullion River”, the “Company”) was incorporated under
      the laws of the State of Nevada on June 29, 2001 under the original name
“Dynasty International Corporation”. The company was a specialty retailer of
      home water quality testing kits and water purification devices until December
      9,
      2003 when the business direction was changed to the exploration of gold and
      silver in the western United States.





The
      Company has six wholly owned subsidiaries all incorporated in the State of
      Nevada.


·
            On
                December 9, 2003, five of the six current subsidiaries were incorporated
                and sold to Bullion River. These subsidiaries are Antone Canyon Mining
                Corp., Cimarron Mining Corp., Corcoran Canyon Mining Corp., North
                Fork
                Mining Corp., and Thomas Creek Mining Corp. The Company changed the
                name
                of Thomas Creek Mining Corp. to Wenban Spring Mining Corp. on September
                28, 2004. In 2004 the Company acquired seven separate option agreements
                and staked and registered its 100% interest in 41 unpatented mineral
                claims in the Painted Hills district in Humboldt County, Nevada.


·
            On
                September 30, 2004, the Company acquired all of the issued and outstanding
                shares of French Gulch (Nevada) Mining Corporation, which was incorporated
                on September 30, 2004.


See
      “Management’s Discussion and Analysis” and “Plan of Operations” below for more
      information.





On
      January 20, 2004, the company changed its name to “Bullion River Gold Corp.”
Bullion River has an authorized capital of 200,000,000 common shares with a
      par
      value of $0.001. As of June 30, 2006, there were 56,121,881 common shares issued
      and outstanding.








**BASIS
      OF PRESENTATION**


The
      accompanying unaudited consolidated financial statements included herein have
      been prepared in accordance with accounting principles generally accepted in
      the
      United States of America for interim financial information and with the
      instructions to Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly,
      they
      do not include all the information and footnotes required by accounting
      principles generally accepted in the United States of America for complete
      financial statements. In the opinion of management, all adjustments (consisting
      of normal recurring accruals) considered necessary for a fair presentation
      have
      been included. Operating results for the three month periods ended June 30,
      2006
      and 2005 are not necessarily indicative of the results that may be expected
      for
      any interim period or the entire year. For further information, these
      consolidated financial statements and the related notes should be read in
      conjunction with the company’s audited financial statements for the year ended
      December 31, 2005 included in the company’s annual report on Form
      10-KSB.




F-7




**NOTE
      2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**





A
      summary
      of the Company’s significant accounting policies is included in the Company’s
      2005 Annual Report. Additional significant accounting policies which affect
      the
      Company or which have been developed since December 31, 2005 are summarized
      below:





**EXPLORATION
      STAGE ACTIVITIES**


The
      Company has not commenced significant operations and, in accordance with SFAS
      No. 7, the Company was considered a development stage company until it changed
      business direction in December 2003 and became an exploration company.





**PRINCIPLES
      OF CONSOLIDATION**


The
      consolidated financial statements include the accounts of the Company and its
      subsidiaries. All significant intercompany balances and transactions have been
      eliminated.





**INVENTORIES**


Materials
      and supplies related to underground mine development are stated at cost
      (first-in, first-out).





**ACCOUNTING
      ESTIMATES**


The
      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 reported amounts of assets,
      liabilities, contingent liabilities, revenues and expenses at the date and
      for
      the periods that the financial statements are prepared. Actual results could
      differ from those estimates.





**CONCENTRATION
      OF CREDIT RISK**


Financial
      instruments that potentially subject the Company to concentrations of credit
      risk consist of cash and certificates of deposit held in U.S. banks that have
      deposit insurance thus limiting the amount of credit exposure.





**REVENUE
      RECOGNITION**


Gold
      and
      silver sales will be recognized when the title passes to the purchaser and
      delivery occurs.





**INCOME
      TAXES**


Income
      tax expense is based on pre-tax financial accounting income. The Company will
      recognize deferred tax assets and liabilities based on differences between
      the
      financial reporting and tax bases of assets and liabilities using the enacted
      tax rates and the laws that are expected to be in effect when the differences
      are expected to be recovered.





**BASIC
      AND DILUTED NET LOSS PER COMMON SHARE**


Basic
      loss per share includes no dilution and is computed by dividing net loss by
      the
      weighted average number of outstanding common shares during the year. Diluted
      earnings per share reflect the potential dilution of securities that would
      occur
      if securities or other contracts (such as stock options and warrants) to issue
      common stock were exercised or converted into common stock. At June 30, 2006,
      the Company had no options outstanding. At June 30, 2006, the Company had
      31,029,194 warrants outstanding.





**LEASES**


Leases
      where substantially all the rewards and risks of ownership of assets remain
      with
      the leasing company are accounted for as operating leases. Payments made under
      operating leases, net of any incentives received by the Company from the leasing
      company, are charged to the statement of operations and comprehensive loss
      on a
      straight-line basis over the period.


F-8





Other
      leases are accounted for as capital leases.





**FIXED
      ASSETS**


Office
      furniture, equipment, telephone system, computer hardware, and computer software
      are stated at cost. Depreciation is computed over the estimated useful life
      of
      the depreciable assets using the straight-line method. The useful life for
      the
      fixed assets is estimated as follows with no salvage value:





Furniture
            
            3
                to 5 yearsEquipment
            
            2
                to 7 yearsTelephone
                System
            
            5
                yearsComputer
                Hardware
            
            3
                yearsComputer
                Software
            
            2
                years





The
      fixed
      assets are reviewed each year to determine whether any events or circumstances
      indicate that the carrying amount of the assets may not be recoverable. Such
      review is performed based on estimated undiscounted cash flows compared with
      the
      carrying value of the assets. If the future cash flows (undiscounted and without
      interest charges) are less than the carrying value, a write-down would be
      recorded to reduce the related asset to its estimated fair value.





**COMPREHENSIVE
      INCOME**


Comprehensive
      income reflects changes in equity that result from transactions and economic
      events from non-owner sources. Comprehensive income for the current period
      represents foreign currency translation items associated with the Company’s
      accounts payable.





**MINERAL
      PROPERTY OPTION PAYMENTS AND EXPLORATION COSTS**


The
      Company will expense all operating costs related to the maintenance and
      exploration of mineral claims in which it has secured exploration rights prior
      to establishment of proven and probable reserves.





**IMPAIRMENT
      OF LONG-LIVED ASSETS**


Long-lived
      assets are reviewed for impairment whenever events or changes in circumstances
      indicate that the carrying amount of an asset may not be recoverable. The
      Company recognizes impairment of long-lived assets in the event that the net
      book value of such assets exceeds the future undiscounted cash flows attributed
      to such assets. No impairment of long-lived assets was recognized for the
      quarter ended June 30, 2006.





**CLOSURE,
      RECLAMATION AND REMEDIATION COSTS**


Current
      laws and regulations require certain closure, reclamation and remediation work
      to be done on mineral properties as a result of exploration, development and
      operating activities. The Company periodically reviews the activities performed
      on its mineral properties and makes estimates of closure, reclamation and
      remediation work that will need to be performed as required by those laws and
      regulations and makes estimates of amounts that are expected to be incurred
      when
      the closure, reclamation and remediation work is expected to be performed.
      Future closure, reclamation and environmental related expenditures are difficult
      to estimate in many circumstances due to the early stages of investigation,
      uncertainties associated with defining the nature an extent of environmental
      contamination, the uncertainties relating to specific reclamation and
      remediation methods and costs, application and changing of environmental laws,
      regulations and interpretation by regulatory authorities and the possible
      participation of other potentially responsible parties.


F-9





The
      Company has estimated costs associated with the closure, reclamation and related
      environmental expenditures of the French Gulch and North Fork properties, which
      have been reflected in its financial statements in accordance with the Financial
      Accounting Standards Board ("FASB") issued Statement of Financial Accounting
      Standards No. 143 ("SFAS 143"), "Accounting for Asset Retirement Obligations",
      which addresses financial accounting and reporting for obligations associated
      with the retirement of tangible long-lived assets and the associated asset
      retirement costs. See Note 4 for a related discussion.





**STOCK
      OPTIONS**


In
      December 2004, the Financial Accounting Standard Board (“FASB”) issued SFAS
      123R, “Share-Based Payments” (“SFAS No. 123R”), a revision of SFAS No. 123,
“Accounting for Stock-Based Compensation” (“SFAS No. 123”), which requires
      companies to measure all employee stock-based compensation awards using a fair
      value method and record such expense in their financial statements. The Company
      adopted this standard effective January 1, 2006 and elected the
      modified-prospective transition method. Under the modified-prospective
      transition method, awards that are granted, modified, repurchased or cancelled
      after the date of adoption should be measured and accounted for in accordance
      with SFAS No. 123R. Because the Company had no options outstanding as of June
      30, 2006 there is no charge attributable to the periods ended June 30, 2006
      and
      June 30, 2005.








**NOTE
      3 - GOING CONCERN**





As
      shown
      in the accompanying financial statements, the Company has incurred significant
      operating losses since inception, and as of June 30, 2006, the Company has
      limited financial resources to support it until such time that it is able to
      generate positive cash flow from operations. The Company’s ability to achieve
      and maintain profitability and positive cash flow is dependent upon its ability
      to locate a profitable mineral property, generate revenues from its planned
      business operations, and control exploration costs. The Company has been
      focusing on implementing its business plan and additional financing will be
      required by the Company to fund its exploration programs and to support
      operations. Management plans to fund its future operations through private
      placement offerings, private loans, and revenue derived from bulk sampling
      at
      French Gulch. Management plans to mitigate its losses by abandoning projects
      that do not meet management’s specification for mineralization or do not have
      adequate tonnage potential. However, there is no assurance that the Company
      will
      be able to obtain additional financing from investors or private lenders. There
      is no assurance that the Company will be able to generate revenues in the
      future. There is no assurance that they will be able to find projects meeting
      their specifications for mineralization or that the projects will have adequate
      tonnage potential. There is no assurance that the Company will commence
      commercial production should they find projects meeting their specification.
      The
      financial statements do not include any adjustments that might result from
      the
      outcome of those uncertainties.








**NOTE
      4 - RECLAMATION ASSET AND OBLIGATION**





The
      Company became subject to and adopted SFAS No. 143, Accounting for Asset
      Retirement Obligations, which establishes a uniform methodology for accounting
      for estimated reclamation and abandonment costs. At December 31, 2005, the
      Company recognized a reclamation obligation for the estimated reclamation costs
      related to the French Gulch and North Fork properties. The related costs have
      been expensed since none of the Company properties were in production or had
      proven or probable mineral reserves.





The
      accretion of the reclamation obligation has been recorded as a separate
      operating expense in the Company's statement of operations with a corresponding
      increase in the reclamation liability. Below are the reclamation obligation
      and
      accretion entries as of June 30, 2006.




F-10


French
      Gulch





In
      connection with the new reclamation permit obtained in December 2005, the
      Company estimated reclamation costs to be $71,200 based on the new operating
      plan for the French Gulch property. At an accretion rate of 6%, the Company
      has
      expensed $2,142, for the six months ended June 30, 2006. The total reclamation
      obligation as of June 30, 2006 is $73,342.





North
      Fork




The
      Company put the initial reclamation permit in place in March 2004 with a
      supplemental permit in May 2005 based on its updated operating plan. In
      connection with these permits, the Company estimated reclamation costs to be
      $31,841 as of December 31, 2005 for the North Fork property. At an accretion
      rate of 6%, the Company has expensed $887, for the six months ended June 30,
      2006. Total reclamation obligation as of June 30, 2006 is $32,782.





The
      following is a description of the changes to the Company's reclamation liability
      and expenses as of June 30, 2006:




Estimated
              Reclamation Expense as of
              December 31, 2005 (Exploration)French
                Gulch
            
            
            
            $
            71,200North
                Fork
            
            
            
            
            31,841Reclamation
                Obligation subtotal before Accretion
            
            
            
            
            103,041Changes
                to Reclamation Obligation for the period ending June 30,
                2006French
                Gulch Accretion Expense
            
            
            
            
            2,142North
                Fork Accretion Expense
            
            
            
            
            887Increase
                to Reclamation Obligation
            
            
            
            
            3,029Total
                Reclamation Obligation
            
            
            
            $
            106,070




**NOTE
      5 - COMMON STOCK**





On
      May 1, 2006, the Company issued 290,000 restricted units to three subscribers
      from shares subscribed on April 20, 2006 in the amount of $145,000 as part
      of
      the $0.50 unit offering.





On
      May 1, 2006, the Company issued 250,000 restricted units to Senator Minerals
      from shares subscribed on April 20, 2006 for the option agreement entered into
      on January 19, 2006.





On
      May 1,
      2006, the Company raised $7,500 in cash from the $0.50 unit offering and issued
      15,000 restricted units to one subscriber.





On
      May
      19, 2006, the Company raised $1,107,500, in cash from the $0.50 unit offering
      and issued 2,215,000 restricted units to fifteen subscribers.


On
        May
        19, 2006, the Company issued 32,386 restricted units at $0.50 per unit under
        Reg
        D as part of a severance package for a Company director.
 
 On
        May
        19, 2006, the Company raised $466,668, in cash from the conversion $0.50
        warrants issuing 933,336 common shares to six warrant holders.
 F-11




On
      June
      5, 2006, the Company raised $66,640, in cash from the conversion $0.50 warrants
      issuing 133,280 common shares to one warrant holder.





On
      June
      9, 2006, the Company raised $257,500 in cash from the $0.50 unit offering and
      issued 515,000 restricted units to eight subscribers.





On
      June
      9, 2006, the Company issued 200,000 restricted units at $0.50 per unit under
      Reg
      S as a reinvestment of finder’s fees for the current offering.





On
      June
      16, 2006, the Company raised $41,667 in cash from the conversion $0.50 warrants
      issuing 83,334 common shares to two warrant holders.





On
      June
      20, 2006, the Company raised $750,000 in cash from the $0.50 unit offering
      and
      issued 1,500,000 restricted units to three subscribers.





On
      June 26, 2006, the Company recalled 166,667 restricted units at $0.50 per unit
      that were issued is error under certain anti-dilution clauses from a prior
      private offering.





On
      June
      27, 2006, the Company raised $60,000 for 80,000 shares subscribed at $0.75
      per
      unit, but not issued.





On
      June
      29, the Company raised $775,002 in cash from the $0.75 unit offering and issued
      1,033,337 restricted units to nine subscribers.





On
      June
      29, 2006, the Company issued 234,000 restricted units at $0.75 per unit under
      Reg D as a reduction towards the total purchase price of the French Gulch
      purchase option.





The
      Company incurred $100,000 in finders’ fees for monies raised during the 2nd
      quarter 2006.




F-12





**NOTE
      6 - STOCK OPTIONS AND WARRANTS**





At
      June
      30, 2006, the Company had zero stock options outstanding. At June 30, 2006,
      the
      Company had the following warrants outstanding:





**Consolidated
      Warrants Outstanding**


**As
      of June 30, 2006**




**Issuance
                  Date**
              
              **Expiration
                  Date**
              
              **Total
                  Warrants**04/15/04
              
              04/15/07
              
              850,00004/30/04
              
              04/30/07
              
              125,00007/20/04
              
              07/20/07
              
              50,00009/29/04
              
              09/29/07
              
              1,293,33511/16/04
              
              11/16/07
              
              299,00012/10/04
              
              12/10/07
              
              185,33312/16/04
              
              12/16/07
              
              63,46712/30/04
              
              12/30/07
              
              367,99901/05/05
              
              01/05/08
              
              25,00002/02/05
              
              02/02/08
              
              290,00002/16/05
              
              02/16/08
              
              50,00003/22/05
              
              03/22/08
              
              481,00004/14/05
              
              04/14/08
              
              22,00004/27/05
              
              04/27/08
              
              7,60004/29/05
              
              04/29/08
              
              1,446,67105/02/05
              
              05/02/08
              
              1,137,23605/05/05
              
              05/05/08
              
              233,33410/18/05
              
              10/18/08
              
              1,500,00001/23/06
              
              11/16/07
              
              69,33301/23/06
              
              12/10/07
              
              50,00001/23/06
              
              12/16/07
              
              63,46701/23/06
              
              12/30/07
              
              501,33301/23/06
              
              01/23/08
              
              1,142,96901/23/06
              
              04/14/08
              
              155,28001/23/06
              
              04/29/08
              
              1,613,34001/23/06
              
              05/02/08
              
              1,155,49101/23/06
              
              05/05/08
              
              133,33402/03/06
              
              02/03/08
              
              11,872,00004/20/06
              
              04/20/08
              
              200,00004/28/06
              
              04/28/08
              
              2,133,33505/01/06
              
              05/01/08
              
              15,00005/04/06
              
              05/04/08
              
              40,00005/05/06
              
              05/05/08
              
              100,00005/08/06
              
              05/08/08
              
              200,00005/10/06
              
              05/10/08
              
              35,00005/11/06
              
              05/11/08
              
              15,00005/12/06
              
              05/12/08
              
              200,00005/19/06
              
              05/19/08
              
              50,00005/30/06
              
              05/30/08
              
              85,00006/05/06
              
              06/05/08
              
              205,00006/06/06
              
              06/06/08
              
              100,00006/09/06
              
              06/09/08
              
              220,00006/12/06
              
              03/13/08
              
              1,180,00006/27/06
              
              06/27/08
              
              1,267,337**TotalWarrants
                  Outstanding**
              
              **31,229,194**


F-13




A
      summary
      of the Company’s stock warrants as of June 30, 2006 and changes during the
      period is presented below:





**Weighted****Warrants**
            
            **Average**
              **Exercise
                Price**Outstanding,
                December 31, 2005
            
            
            9,576,925
            
            $
            1.05Granted
            
            
            23,185,552
            
            
            0.77Canceled
            
            
            (383,333
            )
            
            0.50Exercised
            
            
            (1,149,950
            )
            
            0.50Outstanding,
                June 30, 2006
            
            
            31,229,194
            
            $
            0.88








**NOTE
      7 - MINERAL PROPERTY OPTIONS**





Bullion
      River is a mineral exploration company. Bullion River, through the Subsidiaries,
      conducts gold and silver mineral exploration on properties in the western United
      States.





There
      is
      no assurance that a commercially viable ore body, a reserve, exists in any
      of
      the mineral claims until sufficient exploration work is done and an evaluation
      of that work concludes economic and legal feasibility. Bullion River’s current
      plans are strictly limited to research and exploration.


Bullion
      River intends to try to remove any mineralized material, if economically viable.
      If mineralized material is found on any of Bullion River’s mineral exploration
      projects and removal is warranted, and Bullion River does not have the adequate
      working capital to do so, Bullion River will have to sell additional common
      shares or borrow money to finance the cost of removing the mineralized material.
      There is no assurance that Bullion River will have the working capital to remove
      the mineralized material from its mineral exploration projects, if warranted,
      and there is no assurance Bullion River will be able to raise additional working
      capital through equity or debt financing.





**French
      Gulch (Nevada) Mining Corp.**


On
      June
      23, 2004, French Gulch (Nevada) Mining Corp. (“French Gulch”) entered into a
      letter agreement whereby they proposed to acquire a 100% interest in the
      Washington Niagara Mining Partnership (the "WN Partnership") by acquiring all
      of
      the outstanding partnership units for an aggregate purchase price of $1,500,000.
      The property is located in Shasta County in California and consists of 28
      patented and 27 unpatented lode mining claims ("Washington Niagara Property").





During
      2004, the Company paid a non-refundable deposit of $10,000, which allowed them
      to perform due diligence and a comprehensive feasibility audit on the property
      until September 30, 2004.





On
      October 6, 2004 the Company entered into a formal exploration agreement, with
      option to purchase, whereby their exclusive right to explore the Washington
      Niagara Property was extended to September 30, 2005. Under the terms of this
      agreement, the Company was required to pay $15,000 in outstanding county taxes,
      option payments of $50,000 on each of June 1 and August 1, 2005, to pay all
      State and Federal claim and maintenance fees and to carry liability insurance
      of
      $1 million. The option to purchase could be exercised at any time up to October
      1, 2005. Once French Gulch exercised its option, it became required to make
      bimonthly option payments of $50,000 until production commences. Once production
      commences French Gulch will be required to make bimonthly payments of $175,000.
      Ownership of the Property will transfer to French Gulch once the aggregate
      amount of option payments totals $1,500,000.




F-14




French
      Gulch has rights to explore in accordance with practices customary in the
      industry, but not to mine the Property until the option is exercised. Upon
      exercise of the option French Gulch will have all rights incident to ownership
      of real property allowed by law, including the right to develop and mine the
      property.





The
      Company has staked
      an
      additional 66 (sixty-six) unpatented claims
      in the French Gulch district  to
      properly secure and encompass areas of known gold mineralization. We
      have named
      these newly staked claims, along with the Washington - Niagara
      property, the “ French
      Gulch" properties. The 66 claims staked by French Gulch are 100%-owned by French
      Gulch and are not subject to the agreement with the WN Partnership.





On
      May
      19, 2005, the Company exercised it option with the Washington Niagara Mining
      Partnership to purchase the patented and unpatented mining claims, the mill,
      and
      other personal property. At that time, the first bi-monthly payment of $50,000
      was made less credits of $36,438.07 for a total of $13,561.93.





At
      June
      30, 2006, the Company had made all payments and complied with all of the terms
      of the option related to the Washington Niagara agreement. Per an amendment
      to
      the purchase agreement the company issued 234,000 restricted units at $0.75
      per
      unit on June 29, 2006 in the private offering. The $175,500 value of these
      units
      reduces the total purchase price to $1,324,500. In total the Company has made
      payments to date totaling $378,416 toward the total purchase price.





On
      August
      31, 2005, the Company entered an agreement with the Stump Family Trust (“Stump”)
      giving French Gulch the exclusive right to explore, develop, and mine the
      property. The property is located in Shasta County, California, adjacent to
      the
      French Gulch property, and consists of 1 patented lode mining claim ("Colorado
      Quartz Mine”). The option agreement is for an initial term of ten years and
      expires on July 21, 2015.





In
      order
      to maintain the Stump option in good standing, French Gulch is required to
      pay
      the owner annual payments starting July 21, 2006 in the following amounts:
      $2,500 per year until July 21, 2008, $3,500 per year until July 21, 2011, $4,500
      per year until July 21, 2015. French Gulch is also required to make all
      maintenance and lease fees as required to keep the property in good standing,
      and must have a comprehensive general commercial liability insurance policy
      in
      place having limits of not less than $1 million per personal injury occurrence
      and $100,000 for property damage protecting owner against any claims for injury
      to persons or damage to property resulting from French Gulch’s operations.





**North
      Fork Mining Corp.**


On
      February 23, 2004, Bullion River's wholly owned subsidiary North Fork Mining
      Corp. ("North Fork") was assigned three options to acquire a 100% undivided
      right, title and interest in an aggregate 42 unpatented mineral claims located
      in Sierra County in the State of California. The option was assigned from a
      company controlled by the president of Bullion River for an assignment fee
      of
      $129,115. As additional consideration for the assignment of the option
      agreements, North Fork granted to a company controlled by the president, a
      net
      smelter royalty of 1.5% on the 42 unpatented mineral claims.





On
      February 18, 2004, all required payments under the original (3) option
      agreements dated July 1, 2002, July 3, 2002 and March 3, 2003 had been made
      and
      the owners of the mineral claims consented to the assignment of the option
      agreements to North Fork.


·
            The
                required payments under the July 1 and July 3, 2002 option agreements
                were; $10,000 per agreement on the original signing dates of July
                1 and 3,
                2002 and $150 per month for each agreement for the year ending July
                3,
                2003 and $250 per month for each agreement for the period ended February
                23, 2004.


·
            The
                March 3, 2003 agreement required $10,000 to be paid upon signing
                of a
                final agreement.




F-15




The
      original option agreements dated July 1 and 3, 2002, were for terms of 5 years.
      To keep these option agreements in good standing North Fork is required to
      make
      minimum royalty payments, per agreement, of $250 per month until July 3, 2004,
      $500 per month until July 3, 2005, $1,000 per month until July 3, 2006, the
      greater of $5,000 per month or a 5% NSR until July 3, 2007. North Fork is also
      required to make all maintenance and lease payments to keep the mineral claims
      in good standing during the term of the option agreements. At the end of the
      five year term, after all of the royalty payments have been made, North Fork
      will have acquired a 100% undivided right, title and interest in 35 unpatented
      mineral claims subject to a 5% net smelter royalty payable, until a maximum
      of
      $750,000 in royalty payments have been made under each agreement.





The
      March
      3, 2003 option agreement for seven unpatented claims had no term. North Fork
      can
      acquire an undivided 100% interest in these claims by paying $10,000 once North
      Fork has successfully completed its stage 1 drilling and exploration program,
      and decides to continue with exploration and by paying the owner $70,000 once
      North Fork had successfully completed its stage 2 drilling and exploration
      program and decided to continue with exploration.





At
      June
      30, 2006, the Company was in compliance with all of the terms of the option
      agreement.




**Antone
      Canyon Property**


On
      January 9, 2004, Bullion River's wholly owned subsidiary Antone Canyon Mining
      Corp. ("Antone") was assigned an option to acquire a 100% undivided interest
      in
      60 unpatented mineral claims located in Nye County in the State of Nevada.
      The
      option was assigned from a company controlled by the president of Bullion River
      for an assignment fee of $146,142.





The
      option agreement is for a term of ten years and expires on December 11, 2012.
      In
      order to maintain the option in good standing, Antone is required to pay the
      owner annual payments of $40,000 on or before December 12, commencing December
      12, 2004, until the option expires or until Antone exercises the option in
      accordance with one of the following three exercise options, which are; payment
      to the owner of (1) $4,000,000, (2) $400,000 plus a 3% net smelter royalty
      ("NSR") granted to the owner, or (3) $2,500,000 plus a 1% NSR granted to the
      owner.





At
      June
      30, 2006, the Company had made all required option payments and complied with
      all of the terms of the option agreement.





**Corcoran
      Canyon Mining Corp.**


On
      February 18, 2004, Bullion River's wholly owned subsidiary Corcoran Canyon
      Mining Corp. ("Corcoran") was assigned an option to acquire a 100% undivided
      interest in 41 unpatented mineral claims located in Nye County in the State
      of
      Nevada. The option was assigned from a company controlled by the president
      of
      Bullion River for an assignment fee of $43,596. In addition, a company
      controlled by the president of Bullion River has agreed to transfer all of
      its
      right, title and interest in 89 contiguous, recently staked, unpatented mineral
      claims to Corcoran.





The
      original option agreement was for a term of three years, expiring on February
      28, 2006. In order to maintain the option in good standing Corcoran was required
      to spend; a minimum of $50,000 on exploration and development on or before
      each
      of February 28, 2005 and 2006, Corcoran was to pay all annual claim and lease
      maintenance fees as required to keep the property in good standing and Corcoran
      was required to have a comprehensive general commercial liability insurance
      policy in place having limits of not less than $1 million per occurrence.




F-16




The
      option agreement allowed Corcoran to perform limited testing on the property.
      Corcoran could not commence mining activities on the property until the option
      has been exercised. Corcoran could exercise the option and acquire a 100%
      interest in the property by paying $200,000 to the owner on the third
      anniversary of the option agreement and granting the owner a 2% NSR on the
      mineral claims. Corcoran can repurchase half of the 2% NSR by paying $1 million
      to the owner at any time after the granting of the 2% NSR.





The
      option agreement expired on February 28, 2006. At that time, the Company started
      negotiations with the owner to purchase the property as required by the terms
      set forth in the original agreement noted above. Two partial payments of $20,000
      were made on February 28 and March 30, 2006. On May 19, 2006 the Company
      completed negotiations made the final payment of $160,000.




On
      June
      16, 2006 the Company and Silver Quest Resources LTD and Silver Quest Resources
      (US) LTD (together “Silver Quest”) entered into a joint venture. Silver Quest is
      required to pay the Company $10,000 within five days of execution of the
      agreement. Within 60 days from the date of the agreement Silver Quest must
      receive TSXV acceptance and at that time pay the Company $30,000 and 100,000
      common shares of Silver Quest Resources LTD to keep the option in good
      standing.




Silver
      Quest can acquire an initial 51% interest in the property by making cash
      payments of $250,000, issuing 400,000 shares, and incurring $1,500,000 in
      exploration and development expenditures over a three year period. Silver Quest
      has a further option to increase its interest to 75%, by paying an additional
      $1.0 million, issuing an additional 500,000 shares, and incurring an additional
      $1.75 million (U.S.) in expenditures.




At
      June
      30, 2006, Silver Quest had not made the required $10,000 payment due to the
      Company.





**Cimarron
      Mining Corp.**


On
      February 19, 2004, Bullion River's wholly owned subsidiary Cimarron Mining
      Corp.
      ("Cimarron") was assigned an option to acquire a 100% undivided interest in
      24
      unpatented mineral claims located in Nye County in the State of Nevada. The
      option was assigned from a company controlled by the president of Bullion River
      for an assignment fee of $13,468.





The
      original option agreement is for a term of three years and expires on August
      22,
      2006. In order to maintain the option in good standing Cimarron is required
      to;
      spend a minimum of $50,000 on exploration and development annually on or before
      each of August 22, 2004, 2005 and 2006, Cimarron must pay all annual claim
      and
      lease maintenance fees as required to keep the property in good standing and
      Cimarron must have a comprehensive general commercial liability insurance policy
      in place having limits of not less than $1 million per occurrence.





The
      option agreement allows Cimarron to perform limited testing on the property.
      Cimarron cannot commence mining activities on the property until the option
      has
      been exercised. Cimarron can exercise the option and acquire a 100% interest
      in
      the property by; paying $200,000 to the owner on the third anniversary of the
      option agreement and granting the owner a 1% NSR on the mineral claims. Cimarron
      can repurchase half of the 1% NSR by paying $500,000 to the owner at any time
      after the granting of the 1% NSR.





As
      of
      June 30, 2006, the Company and Brancote US, owner of the majority of the
      Cimarron claims, agreed not to extend the contract beyond its present term
      of
      August 22, 2006 since both parties were unable to come to an agreement with
      the
      holder of the remaining claims in the middle of the claim block.





**Wenban
      Spring Mining Corp.**


On
      February 20, 2004, Bullion River’s wholly owned subsidiary Thomas Creek Mining
      Corp. ("Thomas Creek") was assigned an option to acquire a 100% undivided right,
      title and interest in 76 unpatented mineral claims located in Eureka County
      in
      the State of Nevada. The option was assigned from a company controlled by the
      president of Bullion River for an assignment fee of $53,740.




F-17




During
      the year ended December 31, 2004 the Company terminated their option on the
      Thomas Creek property and acquired a 100% interest in the Wenban property by
      staking claims covering approximately 7.25 square miles in the Cortez Hills
      region of Nevada. On September 28, 2004 the Company changed its name from Thomas
      Creek Mining Corp. to Wenban Spring Mining Corp.





As
      of
      June 30, 2006, the Company has made all claim maintenance fees to the
      BLM.





On
      January 19, 2006, the Company entered into an option agreement with Senator
      Minerals “Senator”, a Vancouver based mineral exploration company (TSX-V: SNR)
      for two properties, the Cortez South and the Gold Valley property, located
      in
      Lander County. These two properties are directly adjacent to the south of the
      Wenban Spring property. The Cortez South property consists of 30 mineral claims
      and the Gold Valley property consists of 24 mineral claims. The terms of the
      agreement include: $10,000 in cash for each property, which was paid on January
      20, 2006 and 125,000 restricted shares of Bullion River common stock for each
      property which were issued on May 1, 2006. Bullion River is obliged to spend
      $150,000.00 in exploration including all maintenance fees over the next two
      years in order to obtain a 51 % ownership in the claims. By spending another
      $200,000.00, Bullion River can increase its ownership to 76 %. After that,
      the
      partners have to spend on a $350,000 to $110,000 basis (Bullion River to
      Senator) or get diluted accordingly. Once a partner has less than 10% ownership,
      it can elect a three percent NSR. The properties are so-called ‘grassroots’
properties, no significant exploration has been done to this point.





**Painted
      Hills Claims**


During
      2004 the Company acquired a 100% interest in 41 unpatented mineral claims in
      the
      Painted Hills district in Humboldt County, Nevada.





As
      of
      June 30, 2006, the Company has paid claim maintenance fees to the BLM on 10
      of
      the 41 claims. We expect to do some minimal exploration by August 31,
      2006  to
      determine the future on this property.





**Mission
      Mine**


On
      February 18, 2006, the Company entered into an exploration agreement with an
      option to purchase the “Mission Mine” from TKM Corporation. The property
      consists of 26 unpatented lode mining claims situated in Riverside County,
      California. In order to maintain this agreement, the Company shall make the
      following payments to TKM Corp.


1.
            Non-refundable
                $10,000 payment on February 18, 2006 to enter into
                agreement.


2.
            $40,000
                payment on February 24, 2006 for the right to explore the property
                through
                August 31, 2006.


3.
            $50,000
                payment on September 1, 2006 for the right to explore the property
                from
                September 1, 2006 until September 1,
                2009.





TKM
      grants Bullion River Gold the exclusive right and option to purchase the
      property as follows:


1.
            Option
                executed up until August 31, 2007 - $1.5
                million.


2.
            Option
                executed from September 1, 2007 to August 31, 2008 - $2.0
                million.


3.
            Option
                executed from September 1, 2008 to August 31, 2009 - $2.5
                million.


In
      addition to the dollar amount defined above, the purchase price shall include
      a
      2 1⁄2 %
      Net
      Smelter Royalty for the first three years of production from
      property.





As
      of
      June 30, 2006, the Company is in compliance with all terms of this
      agreement.




F-18


**Below
      is a summary of the mining claims:**




**Bullion
                  River Gold Corp.****Schedule
                  of Mining Claims by Subsidiary****As
                  of June 30, 2006*****Nevada***
              
              **#
                  of Claims**Antone
                  Canyon
              
              
              60Cimarron
                  Mining
              
              
              24Corcorran
                  Canyon
              
              
              130Painted
                  Hills
              
              
              10Wenban
                  Spring
              
              
              292Total
                  Nevada Claims
              
              
              516***California***
              
              
              **#
                  of Claims**French
                  Gulch
              
              
              121North
                  Fork
              
              
              42Mission
                  Mine
              
              
              97Total
                  California Claims
              
              
              260**Total
                  Claims**
              
              
              **776**





**Note
      8 - Contractual Obligations**





Bullion
      River’s contractual obligations payable for the years ended June 30
      are:




**Bullion
                  River Gold Corp.****Commitment
                  Schedule****For
                  years ending June 30:*****Option
                  Payments***
              
              **2007**
              
              **2008**
              
              **2009**
              
              **2010**
              
              **2011**
              
              **2012**
              
              **2013**
              
              **2014**
              
              **2015**Antone
                  Canyon
              
              $
              40,000
              
              $
              40,000
              
              $
              40,000
              
              $
              40,000
              
              $
              40,000
              
              $
              40,000
              
              $
              -
              
              $
              -
              
              $
              -North
                  Fork
              
              
              120,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -French
                  Gulch
              
              
              302,500
              
              
              302,500
              
              
              302,500
              
              
              49,584
              
              
              3,500
              
              
              4,500
              
              
              4,500
              
              
              4,500
              
              
              4,500Wenban
                  Spring
              
              
              -
              
              
              150,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Mission
                  Mine
              
              
              50,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -$
              512,500
              
              $
              492,500
              
              $
              342,500
              
              $
              89,584
              
              $
              43,500
              
              $
              44,500
              
              $
              4,500
              
              $
              4,500
              
              $
              4,500***Lease
                  Obligations***
              
              
              **2007**
              
              
              **2008**
              
              
              **2009**
              
              
              **2010**
              
              
              **2011**
              
              
              **2012**
              
              
              **2013**
              
              
              **2014**
              
              
              **2015**Corporate
                  Office Lease
              
              $
              94,967
              
              $
              97,816
              
              $
              75,000
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Mine Offices
                  / Housing
              
              
              18,845
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Equipment
              
              
              164,051
              
              
              164,051
              
              
              71,318
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -$
              263,138
              
              $
              261,867
              
              $
              146,318
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -***Other
                  Obligations***
              
              
              **2007**
              
              
              **2008**
              
              
              **2009**
              
              
              **2010**
              
              
              **2011**
              
              
              **2012**
              
              
              **2013**
              
              
              **2014**
              
              
              **2015***Loan
                  Obligations*
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -*Consulting
                  Obligations*
              
              
              52,441
              
              
              7,720
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -$
              37,000
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -**Total
                  Commitments**
              
              $
              812,638
              
              $
              754,367
              
              $
              488,818
              
              $
              89,584
              
              $
              43,500
              
              $
              44,500
              
              $
              4,500
              
              $
              4,500
              
              $
              4,500
  F-19




**Lease
        Obligations**
 
 On
        October 3, 2005, the Company entered into a third party agreement to lease
        (2)
        Caterpillar IT28G loaders for a period of 36 months in the amount of $5,736
        per
        month. This lease ends on October 3, 2008. One loader is located at French
        Gulch
        and the other is at North Fork.


On
      December 21, 2005, the Company entered into a third party agreement to lease
      (1)
      Skid Loader for the North Fork property. The term is 36 months ending December
      2008 with a monthly payment of $938.





On
      February 14, 2006, the Company entered into a third party agreement to lease
      office space which commenced on April 1, 2006 and will end on March 31, 2009.
      This agreement was sought out to accommodate the growing support needs of the
      company and to reduce the rental cost per square foot. Payments under this
      agreement are:


·
            $6,000
                per month from April 1 to June 30,
                2006


·
            $7,855
                per month from July 1, 2006 to March 31,
                2007


·
            $8,091
                per month from April 1, 2007 to March 31, 2008


·
            $8,333
                per month from April 1, 2008 to March 31,
                2009




On
      February 15, 2006, the Company entered into a third party agreement to lease
      an
      Elphinstone R-1300 loader for a period of 36 months ending in February 2009
      in
      the amount of $6,776 per month. This equipment will be used at French Gulch.





On
      April
      12, 2005, the Company entered into a lease agreement for a copier/printer for
      a
      48-month term ending April 30, 2009. Payment under this agreement is $221 per
      month.





On
      April
      16, 2006, the Company entered a rental agreement for office/housing space for
      the French Gulch property whereby the Company is committed to pay $1,550 per
      month until April 15, 2007.





On
      May 1,
      2006, the Company extended a rental agreement for office/housing space for
      the
      North Fork property whereby the Company is committed to pay $1,030 per month
      until October 2006.







**Consulting
      Agreements**





On
      October 3, 2005, the Company entered into a third party agreement for a period
      of 12 months to provide investor relations consulting from November 1, 2005
      until October 31, 2006. Payment under this agreement is $3,000 per month and
      may
      be terminated at any time after 6 months.





On
      December 8, 2005, the Company entered into a third party agreement for investor
      relations services to present Bullion River in Germany and other European
      countries for disseminating investor relations information and creating
      awareness of Bullion River in Switzerland and other German-speaking areas of
      Europe. This contract is for 12 months and will continue from December 8, 2005
      until December 7, 2006. Payments under this agreement are $5,000 per month,
      paid
      quarterly.




On
      January 1, 2006, the Company entered into a third
      party agreement to produce ongoing research coverage in German. This agreement
      has a term of 24 months commencing on January 1, 2006 and ending on December
      31,
      2007. Payments under this agreement are EU$1,000 per month, paid
      monthly.




**NOTE
      9 - RELATED PARTY TRANSACTIONS**





As
      of
      June 30, 2006, there are no related party transactions.




As
      part
      of the option agreement between North Fork and a company controlled by the
      Bullion River president, North Fork granted a net smelter royalty of 1.5% on
      the
      42 unpatented mineral claims to the company president. No transactions have
      resulted from this agreement.




F-20




**NOTE
      10 - SUBSEQUENT EVENTS**





On
      July
      10, 2006, the Company issued 86,000 two-year warrants as part of finders’ fee
      payments from the current offering.





On
      July
      13, 2006, the Company raised $878,750 in cash from the $0.75 unit offering
      and
      issued 1,171,667 restricted units to eleven subscribers.





On
      July
      26, 2006, the Company issued 110,000 restricted units at $0.50 per unit under
      Reg D for commitment of investor relations services through December
      2007.





On
      July
      26, 2006, the Company issued 100,000 restricted shares at $0.75 per share under
      Reg D as finder’s fees from the current offering.





On
      July
      26, 2006, the Company issued 50,000 restricted units at $0.75 per unit under
      Reg
      S for reinvestment of finder’s fees from the current offering.





On
      July
      27, 2006, the Company raised $150,000 in cash from the $0.75 unit offering
      and
      issued 200,001 restricted units to two subscribers.





On
      July
      27, 2006, the Company raised $12,005 in cash from the conversion of $0.50
      warrants issuing 24,010 common shares to one warrant holder.





On
      July
      31, 2006, the Company received $40,000 from Silver Quest which keeps the
      purchase option for Corcoran Canyon in good standing.





The
      Company has incurred an additional $39,500 in finders’ fees for monies raised
      during the current offering.





On
      August
      3, 2006, the Company raised $2,000,000 in cash from a secured convertible
      debenture with a maturity date of August 3, 2008. The Company has incurred
      finder's fees for this debenture consisting of $200,000 that is to be reinvested
      in the Company and 200,000 warrants with an exercise price of
      $0.75.


F-21




**Item
      2: Management’s Discussion and Analysis and Plan of
      Operations.**




RESULTS
      OF OPERATIONS




**Discussion
      of Revenue**




Management
      anticipates that significant revenues will not be achieved unless Bullion River
      locates and commercializes viable mineral properties. There can be no assurance
      that Bullion River will locate viable gold or silver reserves. If Bullion River
      does not locate viable reserves it may not be able to enter into commercial
      production. In particular, commercializing mineral properties will require
      significant funding that Bullion River may not be able to secure.




**Expenses
      for the six months ending June 30, 2006 vs. June 30, 2005**




Bullion
      River expenses totaled $5,997,291 for the six months ended June 30, 2006, an
      increase of $2,502,055 or 72% over the six months ended June 30, 2005.





The
      increase was primarily a result of exploration costs of $3,867,296 compared
      to
      $2,229,651 last year, an increase of $1,637,645, or 73%. Most of this increase
      is related to the French Gulch operations. The French Gulch mill rehabilitation
      began in January 2006 and has accumulated expenses totaling $504,859 as of
      June
      30, 2006. Other increases include employee wages, taxes, and other related
      expenses of $286,818, investor communications of $83,592, office related
      expenses of 39,635, utilities of $23,527, accretion of $3,029, and depreciation
      on fixed assets of $140,199. These increases are attributable to the increased
      level of support required by the exploration and mill activities, and
      continuation of the private offering. These expenses were partially offset
      by
      lower professional fees of $111,851, consulting fees of $68,777, miscellaneous
      expenses of $23,981, travel related of $9,470, bank charges of $5,373, licenses
      and fees of $2,047, and insurance of $1,256.





Other
      non-operating activities include non-operating revenue of $14,875 from interest
      received on bank accounts and non-operating credits of $2,020. These gains
      are
      partially offset by interest expense of $22,401.







LIQUIDITY
      AND FINANCIAL CONDITION




**Cash
      and Working Capital**




Bullion
      River had a cash balance of $288,741 on June 30, 2006. For the six month period
      ending June 30, the Company had net cash inflow of $163,953.


·
            The
                Company used $5,002,010 in operating activities. This operating cash
                outflow is represented by an operating loss of $5,997,291; a decrease
                in
                other current liabilities of $170,758; and an increase in supply
                inventory
                of $43,604. This is partially offset by an increase in accounts payable
                of
                $531,388; a decrease in deposits of $121,653; a decrease in prepaids
                of
                $71,658; an increase in depreciation of $164,034; an increase in
                non-cash
                accretion expense of $3,029; a loss on other of $1,188; and other
                non-cash
                expenses totaling $316,693.


·
            The
                Company had cash outflow in investment activities of $1,603,367,
                which was
                used for the purchase of fixed
                assets.


·
            The
                Company had cash inflow from financing activities totaling $6,769,330
                from
                a decrease in loans from related parties of $13,453, and sales of
                common
                shares resulting in $6,782,783.




F-22




A
      decrease in working capital of $272,433 was due to an increase in current
      liabilities of $408,332 coupled with an increase of $135,899 in current assets.
      Bullion River has an accumulated deficit of $14,528,090 since inception and
      has
      a shareholder’s equity of $1,823,709. The Company has no contingencies or
      long-term agreements except for its commitments under the option agreements,
      premises, and rentals.








**Internal
      and External Sources of Liquidity**




The
      Company’s mineral exploration programs are limited and restricted by the amount
      of working capital that it has and is able to raise from equity financing and
      debt. The Company anticipates continuing to rely on loans payable, equity sales
      of common shares, or joint ventures with other exploration companies in order
      to
      fund further exploration and production programs. Acquiring additional financing
      is subject to a number of factors, including the market prices for gold and
      silver, investor acceptance of the Company’s mineral claims, and investor
      sentiment. These factors may make the timing, amount, terms, or conditions
      of
      additional financing unavailable to the Company.




**Critical
      Accounting Policies**





Mineral
      Properties





The
      Company confines its exploration activities to areas from which gold and silver
      have been previously produced, or to properties that are contiguous to such
      areas and have demonstrated mineralization. The Company will expense the costs
      of acquiring options on the mineral claims and exploration costs until
      established economically recoverable reserves are found, after which, costs
      to
      develop the mineral claims will be treated as an asset. At this time it is
      unknown when established economically recoverable reserves will be found.
      Properties that do not have economically recoverable reserves will be
      abandoned.





Reclamation
      and Abandonment Costs





Current
      laws and regulations require certain closure, reclamation, and remediation
      work
      to be done on mineral properties as a result of exploration, development, and
      operating activities. The Company periodically reviews the activities performed
      on its mineral properties and makes estimates of closure, reclamation, and
      remediation work that will need to be performed as required by those laws and
      regulations and makes estimates of amounts that are expected to be incurred
      when
      the closure, reclamation, and remediation work is expected to be performed.
      Future closure, reclamation, and environmental related expenditures are
      difficult to estimate in many circumstances due to the early stages of
      investigation, uncertainties associated with defining the nature an extent
      of
      environmental contamination, the uncertainties relating to specific reclamation
      and remediation methods and costs, application and changing of environmental
      laws, regulations and interpretation by regulatory authorities, and the possible
      participation of other potentially responsible parties.





The
      Company has estimated costs associated with the closure, reclamation, and
      related environmental expenditures of the French Gulch and North Fork
      properties, which have been reflected in its financial statements in accordance
      with the Financial Accounting Standards Board ("FASB") issued Statement of
      Financial Accounting Standards No. 143 ("SFAS 143"), "Accounting for Asset
      Retirement Obligations", which addresses financial accounting and reporting
      for
      obligations associated with the retirement of tangible long-lived assets and
      the
      associated asset retirement costs. See the financial Note 4 for a related
      discussion.


F-23





PLAN
      OF
      OPERATIONS





**Summary**





During
      the second quarter of 2006, the Company concentrated its activities at the
      French Gulch project located in California.





At
      French
      Gulch, the Company continued work on the new portal and decline to access the
      Washington and Lucky-7 veins for excavation of the bulk sample. The Company
      also
      continued mill rehabilitation in preparation for milling operations of the
      bulk
      sample material. See the French Gulch section below for additional detail.





The
      Company will continue to seek projects that contain high grades and sufficient
      tonnage of gold or silver as well as projects that contain the potential for
      mineralization concealed under post-mineral cover. This focus is primarily
      in
      the Mother lode belt in California and the Great Basin of the western United
      States. There is no assurance that the Company will locate high grades and
      sufficient tonnages of mineralization, or locate projects that contain the
      potential for mineralization concealed under post-mineral cover, or that there
      is high grade or sufficient tonnage of gold or silver to make a project
      commercially viable.





Unless
      the Company’s anticipated production projects contain commercially viable
      sources of gold or silver and until such time as it achieves significant
      revenues from the sales of gold or silver, the Company will continue to incur
      losses. The costs associated with bringing a commercially viable mine into
      operation are significant, and the Company cannot guarantee that it will be
      able
      to obtain the required working capital to bring a mine into commercial
      production.





As
      the
      Company proceeds with its production and exploration programs it will need
      to
      hire independent contractors as well as purchase or lease additional
      equipment.








**French
      Gulch Nevada Mining Corp.**





Land





On
      May
      19 th ,
      2005,
      the Company exercised its option to purchase the French Gulch project from
      the
      Washington Niagara Partnership. The purchase calls for a total cash payment
      of
      $1.5 million. All previous payments made by the Company are to be deducted
      from
      the total payment due. Bi-monthly payments will increase from $50,000 to
      $175,000, once production has begun. Per an amendment to the purchase
      agreement the company issued 234,000 restricted units at $0.75 per unit on
      June29, 2006 in the private offering. The $175,500 value of these units reduces
      the total purchase price to $1,324,500. In total the Company has made payments
      to date totaling  $378,416 toward the total purchase
      price.





Plant
      and Equipment





The
      French Gulch project includes a mill that operated as recently as 2002,
      consisting of a gravity and flotation circuit as well as a furnace for producing
      dore ’ bricks.
      Most of the required trackless equipment necessary to complete the decline
      construction is onsite. This includes LHD units, a drill jumbo, hand held
      drills, a
      scissor
      lift, ventilation fans, air compressors, generator sets, and other miscellaneous
      equipment. The company is currently renting a haul truck, water truck, two
      excavators, a dozer, a skidsteer loader, and an additional air compressor on
      a
      purchase option basis where a portion of the rental costs are applied to the
      purchase price if the Company decides to buy out the equipment.




F-24




Location
      & Background





The
      Washington Niagara property consists of approximately 1824 acres, of which
      approximately 490 acres are patented lands. The property is located within
      the
      French Gulch mining district of the Klamath Mountains province, 15 miles
      northwest of Redding in northwestern California. French Gulch has been the
      largest producer in the province, yielding an estimated 1.5 million ounces
      of
      gold and it contains the highest grades in the province, with ore shoots
      typically grading above 0.5 ounces per ton and commonly above 1.0 ounces per
      ton. Coarse visible gold is common.





The
      Niagara mine workings, located about 3,500 feet west of Washington, are
      presently inaccessible. The mine consisted of 10 levels that exploited veins
      similar to those at Washington, with production over 500 feet vertically and
      along 1,200 feet of strike. The property has produced at least 200,000 ounces
      of
      gold, but production records are incomplete.





Current
      status





During
      the second quarter of 2006, the Company advanced the new decline further towards
      the Lucky 7 and Washington vein systems and completed the vent bypass. The
      I-level has also been completely rehabilitated and a drift has been started
      towards the main decline.





The
      Company continued to work on the mill to prepare the building for resumption
      of
      milling activity. Work included removal of scrap items, repair of wooden
      structures and framing, cleanup, and painting in addition to a new screen and
      a
      Falcon concentrator being installed. On June 9, 2006, the first test run of
      the
      entire mill was conducted. Subsequently, the mill has been run intermittently,
      and more testing has been conducted in order to improve functionality, gold
      recovery, water flows, and water treatment. The Company has also installed
      its
      own assay lab, overhauled its gold furnace system, and improved its storage
      facilities.





The
      Company resumed its surface exploration drilling and completed all 16 holes
      in
      the program. Once all assay results are received and transferred into the
      company’s 3-D modeling software for evaluation a new drilling program will be
      created and implemented.




As
      of
      June 30, 2006, the Company has spent $3.05 million in exploration costs and
      $505,000 on mill rehabilitation at French Gulch.





Future
      Work





The
      new
      decline will also access the Niagara mine. This distance between the Washington
      and Niagara mines will be approximately 2,500 feet in length. This leg of the
      decline is also planned to have diamond drill stations at 400 foot intervals.





Test
      mining from the new decline has started on the Washington vein and will be
      extended to the Lucky 7 vein, and possibly the Dean and No. 2 veins. Test mining
      of the first ore began in June 2006 and should be completed by the end of August
      2006. Approximately 4,000 tons of material will be mined from the main vein
      and
      processed at the French Gulch mill during this phase.





The
      Company continues to plan for mill expansion if the French Gulch property goes
      into production. Pace Civil Inc. of Redding has been retained to assist in
      the
      engineering work required to convert the mill from its current capacity to
      the
      desired 500 tons per day capacity. Pace Civil is a multi disciplined engineering
      group based in Redding, California and is capable of providing the detailed
      civil, mechanical, structural and electrical engineering necessary to meet
      the
      various building codes and requirements of the State of California and Shasta
      County.




F-25




The
      Company intends to proceed with engineering work focused on the completion
      of
      the mill design and other infrastructure requirements. This
      includes:


·
            Foundation
                design for the fine ore bin


·
            Design
                of supports / foundations for the larger ball
                mill.


·
            Procurement
                of equipment


·
            Provision
                of structure over outdoor flotation cells and electrical
                equipment.


·
            Revision
                of site electrical distribution system to reflect operational changes
                from
                previous operations.


·
            Design
                of site offices and shop.


·
            Development
                of new reclamation plan for the site reflecting changes in provision
                for
                waste storage and proactive reclamation
                proposals.


·
            Design
                of mine backfill system.


·
            Emergency
                spill response program.





The
      remaining capital expenditures required to equip the mine for planned production
      is estimated to be $2.1 million.





The
      bulk
      sampling and mill upgrade will be completed in a staged schedule to meet
      permitting requirements. Several of the items have to be completed prior to
      the
      issuance of a county building permit. The revised reclamation plan must be
      developed and approved prior to resuming milling operations. A new bonding
      calculation was completed and the plan was approved by the State Department
      of
      Conservation under the SMARA requirements, Shasta County, the Bureau of Land
      Management and the Regional Water Quality Control Board. Monies in excess of
      $100,000 have been deposited for these bonds.





The
      Company is also planning surface exploration drilling between the Niagara and
      Washington mines. The drilling will first test below the historically mined
      levels at the Niagara Mine. The Company expects to continue with surface core
      drilling in other targets between the Washington and Niagara mine areas due
      to
      potential parallel veining, as is represented by the Lucky-7 and Washington
      veins. The area tested by drilling to date represents about 1% of the overall
      property; management believes there is substantial potential for additional
      vein
      structure. The recently completed surface drill program will help determine
      underground drill targets.





Based
      upon the results of the bulk sample, the decision will be made to proceed to
      full production, continue exploration, or abandon the property. Exploration
      could take place from surface or underground or both. Abandonment will require
      that the Company complete site reclamation per the revised reclamation plan,
      as
      well as meeting any other statutory requirements for mine shutdown.





If
      the
      decision is made to proceed to full production, underground development will
      continue to allow the opening of new stoping blocks in the mine and to access
      the Niagara Mine. The development program will be an ongoing activity to ensure
      sufficient mining areas are available to provide ore to the mill on a continuous
      basis as well as providing additional underground drill sites for further
      exploration. At this time, management will need to schedule and implement the
      mill expansion, which is discussed above to allow for greater throughput.





Other
      work in the mine will include the preparation of an underground equipment
      servicing / repair facility. This will be constructed underground in a yet
      to be
      determined location. The facility will be built underground to reduce surface
      congestion. It will also be simpler to contain any possible pollutants within
      the mine. Underground explosives magazines will also be completed to enhance
      explosives security on the mine site. The planned ore production for this phase
      is estimated to be 30,000 oz. The associated mine and mill operating costs
      are
      estimated to be $12.1 million, and the corresponding revenue derived from the
      ore produced is estimated to be $15 million. This is based on $500 per ounce
      of
      gold, which is conservative given the current price.




F-26




**North
      Fork Mining Corp.**





Plant
      and Equipment





The
      plant
      consists of electrical infrastructure and equipment to support initial mining
      operations. This includes an LHD, skid steer, hand held drills, and other tools
      and storage facilities.





Location
      & Background





The
      North
      Fork project is in the Alleghany mining district in the northern part of the
      Mother Lode Gold Belt in northeastern California, 35 km northeast of Grass
      Valley and about 3.5 km northwest of the Sixteen-to-One mine. North Fork Mining
      controls 42 unpatented mining claims under a lease with an option to purchase
      and is obligated to make advance royalty payments to the lessor of $10,000
      per
      month between July 1 st 2006 and
      July 1 st 2007.





The
      Alleghany mining district is within the northern portion of the Mother Lode
      Belt
      and on the north side of the Grass Valley mining district. The Grass Valley
      and
      Alleghany districts are notable for their high gold grades and for the largest
      gold production among all mesothermal vein camps in western North America.





At
      North
      Fork, data from historic underground examinations indicate a 240m wide zone
      containing steeply-dipping gold-bearing quartz veins locally exceeding 6m in
      width. Assays grading above 0.5 opt (15 g/t) Au are common and nearly continuous
      along the approximately 600 feet of vein-parallel drifting on 3 levels covering
      about 50 meters vertically. Grades exceeding 1 opt are also common. Based on
      the
      historic assays, there is an inferred resource of 100,000 tons grading at least
      0.5 oz/ton; however, additional exploration drilling is necessary to develop
      a
      mineable reserve.





Given
      the
      high gold grades at North Fork, the limited development, the reported widths
      of
      the veins, and its location along strike with major gold vein systems at nearby
      Alleghany, Management believes the project may lead to the discovery of new
      high-grade reserves amenable to underground mining. There has been no systematic
      modern exploration on the property.





Current
      status





The
      Company does not claim to have any ores or reserves whatsoever at this time
      on
      the North Fork Property.





An
      exploration permit is in place, which does not expire until December 2006.
      Currently, the Company has two reclamation bonds in place totaling $29,800
      with
      the U.S. Forest Service for financial assurances for completion of foreseeable
      reclamation related to underground and surface exploration.





The
      Company proceeded past the initial caved area and down ramp to the next cave.
      This cave has again been mined and secured as a series of “lifts” from the top
      down. The backs and walls have been bolted, screened and shotcreted as
      excavation proceeded. The second cave down to the top of the existing decline
      has been secured prior to suspension of activities at North Fork in February
      2006 as a result of management’s decision to concentrate manpower and equipment
      at French Gulch. Operations at North Fork are planned to resume in the third
      quarter of 2006.





As
      of
      June 30, 2006, the Company has spent $305,000 in exploration costs at North
      Fork.




F-27




Proposed
      Exploration





Subject
      to the Company’s ability to raise sufficient funds, decline rehabilitation will
      continue as planned. The rate of advance has been better than expected through
      the caved portions of the decline. The work has been completed on a single
      shift
      basis to this point. The majority of the equipment required to complete the
      rehabilitation phase is onsite.





The
      rehabilitation of the decline will continue through 2006 and the estimated
      costs
      are $600,000 for the year.





After
      the
      completion of the decline rehabilitation, some underground development will
      be
      required to prepare one or more diamond drilling stations. This will
      include:


·
            Excavation
                and securing of the diamond drill
                station


·
            Excavation
                and securing underground explosives
                magazines


·
            Installing
                transformers and cable from surface to the underground drill
                station


·
            Excavation
                and securing a refuge station.





The
      exploratory drilling preparation is planned from the existing upper level and
      estimated to cost $596,000. Completion of this drilling is planned for Dec
      31,
      2006.





Depending
      on the results of the early drilling program and the geological information
      gained from that activity, it may be necessary to advance an exploration drift
      into what is expected to be the hanging wall of the deposit. This will
      facilitate the drilling of a pattern of fanned holes back into the deposit
      from
      a more advantageous angle.








**Antone
      Canyon Mining Corp.**





Plant
      and Equipment





The
      Company does not own a plant or any equipment on the Antone Canyon Property.





Location
      & Background





The
      Antone Canyon Project is in Nye County, Nevada, 70km north of Tonopah and 13km
      southeast of the Round Mountain gold mine (15 Moz Au) operated by Barrick Gold
      Corporation and Kinross Gold Corporation. Lands within the project are
      administered by the U.S. Forest Service. The project consists of 60 unpatented
      mining claims under lease. In order to maintain the project, the Company must
      make annual payments to the lessor of $40,000 due in December.





Previous
      operators completed shallow reverse-circulation and rotary drilling from 1983
      to
      1985 (55 holes totaling 5,090m), and shallow core drilling in 1999 (5 holes
      totaling 524m). Three RC drill holes totaling 2,683 feet were completed by
      Bullion River Gold in late 2004 in the Antone Saddle area. Holes BA-1 and BA-2
      intercepted 5 - 15 foot intervals of 0.018 to 0.016 oz/t gold. BA-3 intercepted
      a 45 foot interval grading 0.22 oz/t gold including a 20 foot zone containing
      0.424 oz/t from 340 to 360 feet. Drilling of the high-grade structures has
      been
      limited to within 100m of surface.




There
      are
      high grade gold and silver assays from drill-hole and trench intersections
      in
      the Antone Saddle area. The intersections are distributed over an area
      approximately 300m by 100m, and mineralized structures are open along strike
      and
      below the shallow levels drilled (100m). Significant soil and rock-chip
      anomalies to 12.7 g/t Au and shallow drill intersections grading above 3 g/t
      Au
      occur more than 600m east and 600m west of the Antone Saddle area.




F-28




Current
      status and Proposed Exploration





The
      Company does not claim to have any ores or reserves whatsoever at this time
      on
      the Antone Property.





The
      Company must conduct exploration to determine what amount of minerals, if any,
      exist on the Antone Canyon property and if any minerals that are found can
      be
      economically extracted and profitably processed. The exploration program is
      designed to economically explore and evaluate the Antone Canyon
      property.





Currently,
      the Company has a reclamation bond in place in the amount of $3,300 with the
      U.S. Forest Service for financial assurances for completion of foreseeable
      reclamation related to surface exploration.





Expenses
      totaled $9,600 for the Antone Canyon property during the first two quarters
      of
      2006, primarily attributable to consulting and insurance.





For
      2006
      the Company plans to do 2,000 feet of surface drilling early in the fourth
      quarter. Total spending at Antone Canyon is estimated to be
      $108,000.








**Cimarron
      Mining Corp.**





Plant
      and Equipment





The
      Company does not own a plant or any equipment on the Cimarron Property.





Location
      & Background





Lands
      in
      the Cimarron project are administered by the U.S. Bureau of Land Management.
      The
      project consists of 24 unpatented claims under lease.





Current
      Status and Proposed Exploration





The
      Company does not claim to have any ores or reserves whatsoever at this time
      on
      the Cimarron Property.





No
      exploration activities have been conducted during 2006. Expenses totaled $1,200
      at the Cimarron property for insurance.





As
      of
      June 30, 2006, the Company and Brancote US, owner of the majority of the
      Cimarron claims, agreed not extend the contract beyond its present term of
      August 22, 2006 since both parties were unable to come to an agreement with
      the
      holder of the remaining claims in the middle of the claim block.





**Corcoran
      Canyon Mining Corp.**




Plant
      and Equipment




The
      Company does not own a plant and there is no equipment on the property.





Location
      & Background





Lands
      in
      the Corcoran Canyon project are administered by the U.S. Bureau of Land
      Management and the U.S. Forest Service. The project consists of 41 unpatented
      claims under lease and 89 unpatented claims controlled 100% by Bullion River.





F-29




The
      project is in Nye County, Nevada, 80 km north of Tonopah and 19 km east of
      the
      Round Mountain gold mine (15 Moz Au). The project is within a regional
      north-trending mineralized belt that includes the volcanic-hosted and
      sediment-hosted gold-silver deposits of Goldfield, Tonopah, Midway, Manhattan,
      Round Mountain, Gold Hill and Northumberland.





Current
      status and Proposed Exploration





The
      Company does not claim to have any ores or reserves whatsoever at this time
      on
      the Corcoran Canyon Property.





Currently,
      the Company has two reclamation bonds in place in the amount of $2,600 with
      the
      U.S. Forest Service and $6,700 with the Bureau of Land Management for financial
      assurances for completion of foreseeable reclamation related to surface
      exploration.





Expenses
      totaled $220,000 for the Corcoran property during the first two quarters of
      2006, primarily attributable to purchase option payments, professional fees,
      and
      insurance.





The
      option agreement expired on February 28, 2006. At this time, the Company started
      negotiations with the owner to purchase the property as required by the terms
      set forth in the original agreement noted above. Two partial payments of $20,000
      were made on February 28 and March 30, 2006. As soon as the negotiation is
      finalized, the company will make the final payment of $160,000.





The
      option agreement expired on February 28, 2006. At that time, the Company started
      negotiations with the owner to purchase the property as required by the terms
      set forth in the original agreement noted above. Two partial payments of $20,000
      were made on February 28 and March 30, 2006. On May 19, 2006 the Company
      completed negotiations made the final payment of $160,000.




On
      June
      16, 2006 the Company and Silver Quest Resources LTD and Silver Quest Resources
      (US) LTD (together “Silver Quest”) entered into a joint venture. Silver Quest is
      required to pay the Company $10,000 within five days of execution of the
      agreement. Within 60 days from the date of the agreement Silver Quest must
      receive TSXV acceptance and at that time pay the Company $30,000 and 100,000
      common shares of Silver Quest Resources LTD to keep the option in good
      standing.




Silver
      Quest can acquire an initial 51% interest in the property by making cash
      payments of $250,000, issuing 400,000 shares, and incurring $1,500,000 in
      exploration and development expenditures over a three year period. Silver Quest
      has a further option to increase its interest to 75%, by paying an additional
      $1.0 million, issuing an additional 500,000 shares, and incurring an additional
      $1.75 million (U.S.) in expenditures.







**Wenban
      Spring Mining Corp.**





Plant
      and Equipment




The
      Company does not own a plant and there is no equipment on the property.





Location
      and Background





The
      project consists of 238 unpatented lode mining claims 100% owned by Wenban
      and
      54 lode claims under option from Senator Minerals, Inc. All of the claims are
      located within lands administered by the U.S. Bureau of Land Management (BLM).





F-30




Wenban
      Spring lies along the west side of the northwest-trending Battle Mountain -
      Eureka Mineral Belt, which contains a number of productive, bulk-mineable,
      sediment-hosted and volcanic-hosted gold deposits, including Pipeline (+11
      Moz
      Au), Cortez Hills, Cortex, Tonkin Springs, Horse Canyon, Gold Bar, and Ruby
      Hill.





The
      Wenban Spring Property is southwest of the Cortez Hills and Pediment gold
      deposits (~ 9 Moz gold @ ~ 4.4 g/t Au) controlled by the Cortez Joint Venture
      (CJV). The Property directly adjoins claims held by the CJV and lies within
      6
      miles (9.6 km) southwest of the Cortez Hills deposit. Cortez Hills is a
      world-class, bulk-mineable Carlin-type gold system discovered in 2002. Wenban
      Spring is on the west edge of the same valley.





Current
      status and Proposed Exploration





The
      Company does not claim to have any ores or reserves whatsoever at this time
      on
      the Wenban Spring property.





The
      Company must conduct exploration to determine what amount of minerals, if any,
      exist on the Wenban Spring property and if any minerals that are found can
      be
      economically extracted and profitably processed. The exploration program is
      designed to economically explore and evaluate the Wenban Spring
      property.





Currently,
      the Company has two reclamation bonds in place totaling $11,400 with the Bureau
      of Land Management for financial assurances for completion of foreseeable
      reclamation related to surface exploration.





Expenses
      totaled $201,000 for the Wenban Spring property during the first two quarters
      of
      2006, primarily attributable to purchase option payments, professional fees,
      and
      insurance.




For
      2006,
      the Company is planning to maintain the property for future exploration with
      total spending on additional mapping and sampling, and rental fees estimated
      to
      be $50,000.





**Painted
      Hills Property**





Location
      and Background





In
      February 2004, Bullion River Gold staked 41 unpatented claims in the Painted
      Hills district in northwestern Nevada. The claims were 100% owned by Bullion
      River Gold Corp. During the third quarter of 2005, the Company paid claim
      maintenance fees to the BLM on 10 of the claims.





The
      Painted Hills project is in Humboldt County, Nevada, 135km northwest of
      Winnemucca. The nearest significant gold producers are the Sleeper mine, 86km
      to
      the southeast, and the Hog Ranch mine, 88km to the southwest. There has been
      no
      gold exploration drilling in the project area. During the 1970's, several
      geothermal test holes were drilled during a regional geothermal exploration
      program near some hot springs, which are situated about 16 km to the northeast.





Based
      on
      studies, the Company believes that the geologic setting and alteration patterns
      are characteristic of productive epithermal gold systems in the region (Midas,
      Sleeper, Ivanhoe-Hollister, and Rosebud). The Painted Hills project has
      important geologic similarities to multi-million ounce epithermal gold deposits
      of the northwestern Great Basin, notably the Sleeper and Midas deposits.
      Potential exists at Painted Hills for discovery of a new, high-grade gold vein
      system.





F-31




Plant
      and Equipment





The
      Company does not own a plant or any equipment on the Painted Hills Property.





Current
      Status and Proposed Exploration





The
      Company does not claim to have any ores or reserves whatsoever at this time
      on
      the Painted Hills property.





The
      Company must conduct exploration to determine what amount of minerals, if any,
      exist on the Painted Hills property and if any minerals that are found can
      be
      economically extracted and profitably processed. The exploration program is
      designed to economically explore and evaluate the Painted Hills
      property.





Currently,
      the Company has a reclamation bond in place in the amount of $6,550 with the
      Bureau of Land Management for financial assurances for completion of foreseeable
      reclamation related to surface exploration.





No
      exploration activities were conducted during the first two quarters of 2006.
      Expenses totaled $1,600 at the Painted Hills property for
      insurance.





As
      of
      June 30, 2006, the Company has paid claim maintenance fees to the BLM on 10
      of
      the 41 claims. The Company expects to do some minimal exploration in third
      quarter of 2006 to determine the future on this property.





**Mission
      Mine Project**





Land





On
      February 18, 2006, the Company entered into an exploration agreement with an
      option to purchase the “Mission Mine” from TKM Corporation. The Company has made
      payments of $50,000 for exploration rights through August 31, 2006. The
      agreement requires the Company to make an additional payment of $50,000 on
      September 1, 2006 for the right to explore the property through September 1,
      2009.





Location
      and Background





In
      March
      2006, Bullion River entered into an exploration agreement with an option to
      purchase the Mission Mine project from TKM Corp. of Palm Springs, California.
      The Mission Mine property consists of 26 unpatented lode claims which are
      located about 58 km southeast of Twenty-Nine Palms in Riverside Co., California.
      The Mission Mine was originally developed between 1890 and 1930 as part of
      the
      Dale Mining District and contributed to the 17,000 oz of gold production during
      that time. The mine was reopened in 1981 when a production shaft was sunk to
      the
      619 foot level and four working levels were developed along the vein for
      production. Underground channel sampling by TKM Corp, Asamera Minerals, USMX,
      and New Gold Corp. in the 1980’s and 1990’s indicated much of the Mission
      quartz-magnetite-specularite-pyrite vein contained between 0.25 oz/t and 2.0
      oz/t Au. Recent surface sampling from the Mission vein and other surrounding
      veins has confirmed high gold contents from various quartz-magnetite veins
      in
      the district.





Since
      entering into the exploration agreement, Bullion River has located an additional
      71 claims in the district to cover a series of old mines, veins, prospects,
      adits, and shafts. Three of the old mines, which were recently acquired by
      staking, had mills which produced gold from the ore.





F-32




Plant
      and Equipment





The
      Mission Mine project includes a mill, head frame, electrical equipment, and
      miscellaneous mining equipment that was used in the early to mid 1980’s while
      developing the Mission Mine. Most of the equipment is no longer serviceable
      and
      will be removed as scrap if the project progresses.




Current
      status and Proposed Exploration





The
      Company does not claim to have any ores or reserves whatsoever at this time
      on
      the Mission Mine Claims.





The
      Company must conduct exploration to determine what amount of minerals, if any,
      exist on the Mission Mine property and if any minerals that are found can be
      economically extracted and profitably processed. The exploration program is
      designed to economically explore and evaluate the Mission Mine
      property.





Ground
      magnetometer surveys have been conducted over the most prominent veins exposed
      on the claim blocks and they have defined the structural zones controlling
      the
      veining. Ongoing metallurgical scoping tests are being performed to determine
      economically feasible processes for gold recovery. The results of these tests
      are expected in the third quarter. Additional mapping and sampling of the
      various mines and veins found on the claims is planned for the third quarter
      of
      2006.  The
      Company is also working on permitting for a core drilling program to take place
      in winter 2006-2007.





Expenses
      totaled $137,000 for the Mission Mine property during the first two quarters
      of
      2006, primarily attributable to purchase option payments, legal fees, and travel
      costs.





For
      2006,
      the Company is currently in the process of permitting a plan of operations
      through the Barstow BLM office with the intent of improving the mine access
      road
      and starting a feasibility study for the mining district.






F-33









**Item
          3.**  **Controls
          and Procedures**
  As
          of the
          end of the period covered by this report, management, with the participation
          of
          the chief executive officer and of the chief financial officer, evaluated
          the
          effectiveness of our “disclosure controls and procedures,” as defined in Rule
          13a-15(e) under the Securities Exchange Act of 1934. Based on that evaluation,
          these officers concluded that, as of the date of their evaluation, the
          disclosure controls and procedures were effective to provide reasonable
          assurance that information required to be disclosed in our periodic filings
          under the Securities Exchange Act of 1934 is accumulated and communicated
          to our
          management, including those officers, to allow timely decisions regarding
          required disclosure. It should be noted that a control system, no matter
          how
          well designed and operated, can provide only reasonable, not absolute,
          assurance
          that it will detect or uncover failures within our company to disclose
          material
          information otherwise required to be set forth in our periodic
          reports.
  During
          the period covered by this report, there
          were no changes
          to the internal controls over financial reporting that have materially
          affected,
          or are reasonably likely to materially affect the report ,
          including any significant deficiencies or material weaknesses of internal
          controls that would require corrective action.










F-34







PART
          II -
          OTHER INFORMATION
 
 Item
          1.  Legal
          Proceedings.
 
 None;
          not
          applicable.
 
 Item
          2.  Unregistered Sales
          of
          Equity Securities and Use of Proceeds.
 
 None;
          not
          applicable.
 
 Item
          3.  Defaults Upon Senior
          Securities.
 
 None;
          not
          applicable.
 
 Item
          4.  Submission of Matters
          to a Vote of Security Holders.
 
 None;
          not
          applicable.
 
 Item
          5.  Other
          Information.
 
 None;
          not
          applicable.
 
 Item
          6.  Exhibits.
  31.1
                302
                    Certification of Peter M Kuhn
 
 31.2
                302
                    Certification of Nancy Huber
  32
                906
                    Certification
     
 SIGNATURES
 
 Pursuant
        to the requirements of the Securities Exchange Act of 1934, the Registrant
        has
        duly caused this Report to be signed on its behalf by the undersigned thereunto
        duly authorized.
  **BULLION
                  RIVER GOLD CORP.**Dated: 
                  October 25, 2006
                By:
                /s/ Peter
                  M.
                  KuhnPeter
                    M. Kuhn
                  Chief Executive Officer and
                    Director
 Dated: October
                  25, 2006
                By:
                /s/ Nancy
                  HuberNancy
                    Huber
                  Chief Financial Officer and
                    Director