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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-QSB/A

(Mark One)

[X]****QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended **March 31, 2006**

[   ]****TRANSITION REPORT UNDER SECTION
13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from ________________ to
_______________

**000-50146**(Commission file number)

TORNADO GOLD INTERNATIONAL CORP.(Exact name of small business issuer as specified in its
charter)

|Nevada                            | 94-3409645         
|--------------------------------- | -------------------
|(State or other jurisdiction      | (IRS Employer      
|of incorporation or organization) | Identification No.)

**3841 Amador Way, Reno, Nevada 89502**
(Address of principal executive offices)

**(775) 827-2324**(Issuer's telephone
number)

**N/A**(Former name, former address and
former fiscal year, if changed since last report)

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

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

The number of shares of common stock outstanding as of May 10,
2006 was 28,791,725.

Transitional Small Business Disclosure Format (check one): Yes
[   ] No [X]

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**EXPLANATORY NOTE**

EXPLANATION OF THE AMENDED FILING: THIS FORM 10-QSB/A AND THE
  FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 2006 INCLUDED HEREIN
  HAVE BEEN AMENDED. OUR COMPANY HAS RESTATED THE FINANCIAL STATEMENTS BASED UPON
  OUR MANAGEMENT’S FURTHER REVIEW OF ITS STATUS AS AN EXPLORATORY STAGE
  COMPANY.

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TORNADO GOLD INTERNATIONAL CORP.

Index

|               |                                                                                                                                                                     | Page  
|-------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------
|               |                                                                                                                                                                     | Number
|               |                                                                                                                                                                     |       
|PART I.        | FINANCIAL INFORMATION                                                                                                                                               | 3     
|               |                                                                                                                                                                     |       
|Item 1.        | Financial Statements                                                                                                                                                | 3     
|               |                                                                                                                                                                     |       
|               | Balance Sheet as of March 31, 2006 (unaudited)                                                                                                                      | 3     
|               |                                                                                                                                                                     |       
|               | Statements of Operations for the three months ended March
      31, 2006 and 2005, and for the period from March 19, 2004, through March
      31, 2006 (unaudited) | 4     
|               |                                                                                                                                                                     |       
|               | Statements of Cash Flows for the three months ended March
      31, 2006 and 2005, and for the period From March 19, 2004, through March
      31, 2006(unaudited)  | 5     
|               |                                                                                                                                                                     |       
|               | Notes to Financial Statements (unaudited)                                                                                                                           | 6     
|               |                                                                                                                                                                     |       
|Item 2.        | Management's Discussion and Analysis or Plan of Operation                                                                                                           | 15    
|               |                                                                                                                                                                     |       
|Item 3.        | Controls and Procedures                                                                                                                                             | 17    
|               |                                                                                                                                                                     |       
|PART II.       | OTHER INFORMATION                                                                                                                                                   | 17    
|               |                                                                                                                                                                     |       
|Item 6.        | Exhibits                                                                                                                                                            | 17    
|               |                                                                                                                                                                     |       
|SIGNATURES     | 17                                                                                                                                                                 
|               |                                                                                                                                                                     |       
|CERTIFICATIONS | 18                                                                                                                                                                 

2

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Tornado Gold International Corp. (formerly
Nucotec, Inc.) BALANCE SHEET

|                                                            |   | March 31    |  
|----------------------------------------------------------- | - | ----------- | -
|                                                            |   | 2006        |  
|                                                            |   | (Unaudited) |  
|ASSETS                                                      |   |             |  
|                                                            |   |             |  
|CURRENT ASSETS                                              |   |             |  
|Cash and cash equivalents                                   | $ | 181,165     |  
|Prepaid expenses                                            |   | 5,306       |  
|                                                            |   |             |  
|TOTAL CURRENT ASSETS                                        |   | 186,471     |  
|                                                            |   |             |  
|MINING CLAIMS                                               |   | 944,333     |  
|TOTAL ASSETS                                                | $ | 1,130,804   |  
|                                                            |   |             |  
|LIABILITIES AND STOCKHOLDERS' DEFICIT                       |   |             |  
|                                                            |   |             |  
|CURRENT LIABILITIES                                         |   |             |  
|Accounts payable - related
      party                      | $ | 9,238       |  
|Accounts payable - others                                   |   | 13,739      |  
|Notes payable (including
      accrued interest of $28,867) |   | 1,109,683   |  
|TOTAL CURRENT LIABILITIES                                   |   | 1,132,660   |  
|                                                            |   |             |  
|COMMITMENTS AND CONTINGENCIES                               |   |            |  
|                                                            |   |             |  
|STOCKHOLDERS' DEFICIT                                       |   |             |  
|Common stock; $0.001 par
      value; 100,000,000 shares    |   |             |  
|authorized; 28,791,725
      shares issued and outstanding  |   | 28,792      |  
|Additional paid in capital                                  |   | 1,693,305   |  
|Accumulated deficit                                         |   | (704,993    | )
|Deficit accumulated during the
      exploratory stage      |   | (1,018,542  | )
|Stock subscription receivable                               |   | (418        | )
|TOTAL STOCKHOLDERS' DEFICIT                                 |   | (1,856      | )
|TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                 | $ | 1,130,804   |  

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

3

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Tornado Gold International Corp. (formerly Nucotec, Inc.)
STATEMENTS OF OPERATIONS

|                                             |   |                            |   |   |                |   |   | From           |  
|-------------------------------------------- | - | -------------------------- | - | - | -------------- | - | - | -------------- | -
|                                             |   | For the Three Months Ended |   |   | March 19, 2004 |  
|                                             |   | March
      31,            |   |   | through        |  
|                                             |   | 2006                       |   |   | 2005           |   |   | March 31, 2006 |  
|                                             |   | (Unaudited)                |   |   | (Unaudited)    |   |   | (Unaudited)    |  
|                                             |   |                            |   |   |                |   |   |                |  
|NET REVENUE                                  | $ |                           |   | $ |               |   | $ |               |  
|                                             |   |                            |   |   |                |   |   |                |  
|OPERATING EXPENSES                           |   |                            |   |   |                |   |   |                |  
|Compensation expense on option grants        |   |                           |   |   |               |   |   | 22,409         |  
|Mining exploration expenses                  |   | 39,960                     |   |   | 17,850         |   |   | 495,891        |  
|General and administrative expenses          |   | 83,810                     |   |   | 28,125         |   |   | 390,263        |  
|                                             |   | 123,770                    |   |   | 45,975         |   |   | 908,563        |  
|                                             |   |                            |   |   |                |   |   |                |  
|LOSS FROM OPERATIONS                         |   | (123,770                   | ) |   | (45,975        | ) |   | (908,563       | )
|                                             |   |                            |   |   |                |   |   |                |  
|OTHER INCOME (EXPENSE)                       |   |                            |   |   |                |   |   |                |  
|Interest expense                             |   | (16,181                    | ) |   | (19,638        | ) |   | (109,979       | )
|                                             |   |                            |   |   |                |   |   |                |  
|TOTAL OTHER INCOME (EXPENSE)                 |   | (16,181                    | ) |   | (19,638        | ) |   | (109,979       | )
|                                             |   |                            |   |   |                |   |   |                |  
|LOSS BEFORE PROVISION FOR INCOME TAXES       |   | (139,951                   | ) |   | (65,613        | ) |   | (1,018,542     | )
|                                             |   |                            |   |   |                |   |   |                |  
|PROVISION FOR INCOME TAXES                   |   |                           |   |   |               |   |   |               |  
|                                             |   |                            |   |   |                |   |   |                |  
|NET LOSS                                     | $ | (139,951                   | ) | $ | (65,613        | ) |   | (1,018,542     | )
|                                             |   |                            |   |   |                |   |   |                |  
|NET LOSS PER SHARE - BASIC AND DILUTED       | $ | (0.00                      | ) | $ | (0.00          | ) |   |                |  
|                                             |   |                            |   |   |                |   |   |                |  
|WEIGHTED AVERAGE COMMON EQUIVALENT           |   |                            |   |   |                |   |   |                |  
|SHARES OUTSTANDING - BASIC AND
      DILUTED |   | 28,791,725                 |   |   | 54,014,400     |   |   |                |  

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

4

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Tornado Gold International Corp.(formerly
Nucotec, Inc.) STATEMENTS OF CASH FLOWS

|                                                    |   |                            |   |   |                |   |  | From           |  
|--------------------------------------------------- | - | -------------------------- | - | - | -------------- | - |  | -------------- | -
|                                                    |   | For the Three Months Ended |   |   | March 19, 2004 |  
|                                                    |   | March
      31,            |   |   | through        |  
|                                                    |   | 2006                       |   |   | 2005           |   |  | March 31, 2006 |  
|                                                    |   | (Unaudited)                |   |   | (Unaudited)    |   |  | (Unaudited)    |  
|                                                    |   |                            |   |   |                |   |  |                |  
|CASH FLOWS FROM OPERATING ACTIVITIES:               |   |                            |   |   |                |   |  |                |  
|Net loss from continuing operations                 | $ | (139,951                   | ) | $ | (65,613        | ) |  | (1,018,542     | )
|Adjustment to reconcile net loss
      to net cash  |   |                            |   |   |                |   |  |                |  
|used in operating activities:                       |   |                            |   |   |                |   |  |                |  
|Value of options/warrant
      granted for services |   |                           |   |   |               |   |  | 22,409         |  
|Changes in:                                         |   |                            |   |   |                |   |  |                |  
|Prepaid expenses
      and other current assets     |   | 1,088                      |   |   |               |   |  | (307           | )
|Accounts payable and accrued expenses               |   | 25,857                     |   |   | 32,673         |   |  | 126,946        |  
|                                                    |   |                            |   |   |                |   |  |                |  
|Net cash used in operating activities               |   | (113,006                   | ) |   | (32,940        | ) |  | (869,494       | )
|                                                    |   |                            |   |   |                |   |  |                |  
|CASH FLOWS FROM INVESTING ACTIVITIES:               |   |                            |   |   |                |   |  |                |  
|Purchase of mining
      claims                     |   | (420,000                   | ) |   | (43,314        | ) |  | (944,333       | )
|                                                    |   |                            |   |   |                |   |  |                |  
|Net cash used in investing activities               |   | (420,000                   | ) |   | (43,314        | ) |  | (944,333       | )
|                                                    |   |                            |   |   |                |   |  |                |  
|                                                    |   |                            |   |   |                |   |  |                |  
|CASH FLOWS FROM FINANCING ACTIVITIES:               |   |                            |   |   |                |   |  |                |  
|Proceeds from notes payable                         |   | 649,838                    |   |   | 50,000         |   |  | 2,105,816      |  
|Payment on note payable, related party              |   |                            |   |   |                |   |  | (42,500        | )
|Repurchase of shares of common
      stock          |   |                            |   |   |                |   |  | (577,906       | )
|Proceeds from issuance of common stock              |   |                            |   |   |                |   |  | 509,582        |  
|                                                    |   |                            |   |   |                |   |  |                |  
|Net cash provided by financing activities           |   | 649,838                    |   |   | 50,000         |   |  | 1,994,992      |  
|                                                    |   |                            |   |   |                |   |  |                |  
|NET CASH PROVIDED BY CONTINUING OPERATIONS          |   | 116,832                    |   |   | (26,254        | ) |  | 181,165        |  
|                                                    |   |                            |   |   |                |   |  |                |  
|CASH AND CASH EQUIVALENTS, Beginning of year        |   | 64,333                     |   |   | 53,141         |   |  |               |  
|                                                    |   |                            |   |   |                |   |  |                |  
|CASH AND CASH EQUIVALENTS, End of year - 1679569    | $ | 181,165                    |   | $ | 26,887         |   |  | 181,165        |  
|                                                    |   |                            |   |   |                |   |  |                |  
|SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:  |   |                            |   |   |                |   |  |                |  
|                                                    |   |                            |   |   |                |   |  |                |  
|Interest paid                                       | $ |                           |   | $ |               |   |  |                |  
|Income taxes paid                                   | $ |                           |   | $ |               |   |  |                |  

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

5

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TORNADO GOLD INTERNATIONAL CORP. (formerly
Nucotec, Inc.)NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)

Note 1 - Organization

Organization

Tornado Gold International Corp. (formerly
  Nucotec, Inc.) was incorporated in the state of Nevada on October 8, 2001. On
  July 7, 2004, the name of the company was officially changed to Tornado Gold
  International Corp. (the Company). The Company is currently in the
  exploratory stage with its principal activity being the exploration of mining
  properties for future commercial development and production (See Note 3).

**Restated Financial Statements**

The accompanying financial statements
  have been restated based upon Management’s further review of its status
  as an exploratory stage company.

Basis of Presentation

The accompanying interim financial
statements have been prepared by the Company pursuant to the rules and
regulations of the Securities and Exchange Commission (the SEC) for interim
financial reporting. These interim financial statements are unaudited and, in
the opinion of management, include all adjustments (consisting of normal
recurring adjustments and accruals) necessary to present fairly the balance
sheet, operating results and cash flows for the periods presented in accordance
with accounting principles generally accepted in the United States of America
(GAAP). Operating results for the three months ended March 31, 2006 are not
necessarily indicative of the results that may be expected for the year ending
December 31, 2006 or for any other interim period during such year. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with GAAP have been omitted in accordance with the rules
and regulations of the SEC. These interim financial statements should be read in
conjunction with the audited financial statements and notes thereto contained in
the Companys Form 10-K for the year ended December 31, 2005.

Note 2 - Summary of Significant Accounting Policies

Going Concern

The accompanying financial statements
have been prepared in conformity with accounting principles generally accepted
in the United States of America, which contemplate continuation of the Company
as a going concern. The Company has no established source of material revenue,
has incurred a net loss for the three months ended March 31, 2006 of $139,951,
and as of March 31, 2006 had a negative working capital of $946,189 and had an
accumulated deficit of $1,679,569. These conditions raise substantial doubt as
to the Company's ability to continue as a going concern. These financial
statements do not include any adjustments that might result from the outcome of
this uncertainty. These financial statements do not include any adjustments
relating to the recoverability and classification of recorded asset amounts, or
amounts and classification of liabilities that might be necessary should the
Company be unable to continue as a going concern.

Management plans to take the following
steps that it believes will be sufficient to provide the Company with the
ability to continue in existence: The Company plans to raise additional
operating funds through equity or debt financing. There is no assurance that the
Company will be able to arrange for financing and has not, to date, had any
substantive discussions with any third parties regarding such financing.

Stock Split

On April 19, 2004, the Company
authorized a 50-for-1 stock split. On August 18, 2004, the Company authorized a
6.82 -for-1 stock split. On May 16, 2005, the Company authorized a 1.20 -for-1
stock split. The accompanying financial statements have been prepared as if all
of the stock-splits occurred at the beginning of each period presented.

Stock Based Compensation

The Company accounts for stock-based
compensation under SFAS No. 123R, Share-based Payment and SFAS No. 148,
Accounting for Stock-Based CompensationTransition and DisclosureAn
amendment to SFAS No. 123. These standards define a fair value based method
of accounting for stock-based compensation. In accordance with SFAS Nos. 123R
and 148, the cost of stock-based employee compensation is measured at the grant
date based on the value of the award and is recognized over the vesting period.
The value of the stock-based award is determined using the Black-Scholes
option-pricing model, whereby compensation cost is the excess of the fair value
of the award as determined by the pricing model at the grant date or other
measurement date over the amount an employee must pay to acquire the stock. The
resulting amount is charged to expense on the straight-line basis over the
period in which the Company expects to receive the benefit, which is generally
the vesting period. During the three months ended March 31, 2006 and 2005, the
Company recognized no compensation expense under SFAS No. 123 as no options were
issued to employees during these two periods (See Note 5).

6

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As of April 15, 2005, the Company
adopted its 2005 stock option plan to compensate its directors. As of March 31,
2006, no options have been granted to the directors.

Use of 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 and liabilities and disclosures of contingent assets
and liabilities at the date of the financial statements and the reported amounts
of revenue and expenses during the reporting periods. Actual results could
differ from these estimates.

Fair Value of Financial
Instruments

For certain of the Company's financial
instruments, including cash, deposits, accounts payable and accrued interest,
the carrying amounts approximate fair value due to their short maturities. The
amounts shown for notes payable also approximate fair value because current
interest rates and terms offered to the Company for similar debt are
substantially the same.

Cash and Cash Equivalents

For purposes of the statements of cash
flows, the Company defines cash equivalents as all highly liquid debt
instruments purchased with a maturity of three months or less, plus all
certificates of deposit.

Concentration of Credit
Risk

Financial instruments, which
potentially subject the Company to concentrations of credit risk, consist of
cash and accounts receivables. The Company places its cash with high quality
financial institutions and at times may exceed the FDIC $100,000 insurance
limit. The Company extends credit based on an evaluation of the customer's
financial condition, generally without collateral. Exposure to losses on
receivables is principally dependent on each customer's financial condition. The
Company monitors its exposure for credit losses and maintains allowances for
anticipated losses, as required.

Revenue Recognition

The Company has not generated any
revenue from its mining operations.

Mining Costs

Costs incurred to purchase, lease or
otherwise acquire property are capitalized when incurred. General exploration
costs and costs to maintain rights and leases are expensed as incurred.
Management periodically reviews the recoverability of the capitalized mineral
properties and mining equipment. Management takes into consideration various
information including, but not limited to, historical production records taken
from previous mine operations, results of exploration activities conducted to
date, estimated future prices and reports and opinions of outside consultants.
When it is determined that a project or property will be abandoned or its
carrying value has been impaired, a provision is made for any expected loss on
the project or property.

Income Taxes

The Company accounts for income taxes
in accordance with SFAS No. 109, "Accounting for Income Taxes." Deferred taxes
are provided on the liability method whereby deferred tax assets are recognized
for deductible temporary differences, and deferred tax liabilities are
recognized for taxable temporary differences. Temporary differences are the
differences between the reported amounts of assets and liabilities and their tax
bases. Deferred tax assets are reduced by a valuation allowance when, in the
opinion of management, it is more likely than not that some portion or all of
the deferred tax assets will be realized. Deferred tax assets and liabilities
are adjusted for the effects of changes in tax laws and rates on the date of
enactment.

Loss Per Share

The Company reports earnings (loss) per
share in accordance with SFAS No. 128, "Earnings per Share." Basic earnings
(loss) per share is computed by dividing income (loss) available to common
shareholders by the weighted average number of common shares available. Diluted
earnings (loss) per share is computed similar to basic earnings (loss) per share
except that the denominator is increased to include the number of additional
common shares that would have been outstanding if the potential common shares
had been issued and if the additional common shares were dilutive. Diluted
earnings (loss) per share has not been presented since the effect of the assumed
conversion of options to purchase common shares would have an anti-dilutive
effect. The only potential common shares as of March 31, 2006 were 210,000
options and 650,000 warrants that have been excluded from the computation of
diluted net loss per share because the effect would have been anti-dilutive. If
such shares were included in diluted EPS, they would have resulted in
weighted-average common shares of 29,626,725 and 54,074,400 for the three months
ended March 31, 2006 and 2005, respectively.

7

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Reclassification

Certain reclassifications have been
made to the 2005 balances to conform to the 2006 presentation.

Recently Issued Accounting
Pronouncements

In May 2005, the FASB issued SFAS No.
154, "Accounting Changes and Error Corrections." This statement applies to all
voluntary changes in accounting principle and requires retrospective application
to prior periods' financial statements of changes in accounting principle,
unless this would be impracticable. This statement also makes a distinction
between "retrospective application" of an accounting principle and the
"restatement" of financial statements to reflect the correction of an error.
This statement is effective for accounting changes and corrections of errors
made in fiscal years beginning after December 15, 2005. The Company believes the
adoption of this standard will have no material impact on its financial
statements.

In February 2006, FASB issued SFAS No.
155, Accounting for Certain Hybrid Financial Instruments. SFAS No. 155 amends
SFAS No 133, Accounting for Derivative Instruments and Hedging Activities, and
SFAF No. 140, Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities. SFAS No. 155, permits fair value remeasurement
for any hybrid financial instrument that contains an embedded derivative that
otherwise would require bifurcation, clarifies which interest-only strips and
principal-only strips are not subject to the requirements of SFAS No. 133,
establishes a requirement to evaluate interest in securitized financial assets
to identify interests that are freestanding derivatives or that are hybrid
financial instruments that contain an embedded derivative requiring bifurcation,
clarifies that concentrations of credit risk in the form of subordination are
not embedded derivatives, and amends SFAS No. 140 to eliminate the prohibition
on the qualifying special-purpose entity from holding a derivative financial
instrument that pertains to a beneficial interest other than another derivative
financial instrument. This statement is effective for all financial instruments
acquired or issued after the beginning of the Companys first fiscal year that
begins after September 15, 2006. The Company believes the adoption of this
standard will have no material impact on its financial statements.

In December 2004, the FASB issued FASB
Statement No. 123R, "Share-Based Payment, an Amendment of FASB Statement No.
123" ("FAS No. 123R"). FAS No. 123R requires companies to recognize in the
statement of operations the grant- date fair value of stock options and other
equity-based compensation issued to employees. FAS No. 123R is effective
beginning in the Company's first quarter of fiscal 2006. The Company believes
the adoption of this standard may have a significant impact on its financial
statements.

In December 2004, the FASB issued SFAS
No. 153, Exchanges of Non-Monetary Assets, an amendment of APB Opinion 29,
Accounting for Non-Monetary Transactions. The amendments made by SFAS No.
153 are based on the principle that exchanges of non-monetary assets should be
measured based on the fair value of the assets exchanged. Further, the
amendments eliminate the narrow exception for non-monetary exchanges of similar
productive assets and replace it with a broader exception for exchanges of
non-monetary assets that do not have "commercial substance." The provisions in
SFAS No. 153 are effective for non-monetary asset exchanges occurring in fiscal
periods beginning after June 15, 2005. Early application is permitted and
companies must apply the standard prospectively. The Company adopted this
statement on January 1, 2005. The adoption of the statement did not cause a
significant change in the current manner in which the Company accounts for its
exchanges of non-monetary assets.

In June 2005, the EITF reached
consensus on Issue No. 05-6, Determining the Amortization Period for Leasehold
Improvements ("EITF 05-6.") EITF 05-6 provides guidance on determining the
amortization period for leasehold improvements acquired in a business
combination or acquired subsequent to lease inception. The guidance in EITF 05-6
will be applied prospectively and is effective for periods beginning after June
29, 2005. EITF 05-6 is not expected to have a material effect on its financial
position or results of operations.

8

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Note 3 - Mining Claims

NT Green Property, HMD Gold
Property, Goodwin Hill Gold Property, and Wilson Peak Property

On May 31, 2004, the Company entered
into four agreements with a company wholly owned by Mr. Carl Pescio ("Pescio"),
a Director of the Company, to lease four mining properties. The terms of the
four leases are substantially identical and are as follows:

A schedule of the advanced lease
payments for each of the four properties is as follows:

|Due Date                  |   | Amount  | 
|------------------------- | - | ------- | 
|                          |   |         | 
|June 5, 2004              | $ | 15,000  | 
|May 15, 2005              | $ | 22,500  | 
|February 5, 2006          | $ | 30,000  | 
|February 5, 2007          | $ | 37,500  | 
|February 5, 2008          | $ | 50,000  | 
|February 5, 2009          | $ | 62,500  | 
|February 5, 2010          | $ | 75,000  | 
|February 5, 2011 and each |   |         | 
|year thereafter until     |   |         | 
|production commences      | $ | 100,000 | 

Upon completion of a bankable
feasibility study and payments totaling $105,000, the Company will own 100% of
the property subject to a continuing production royalty of 4%. Once the $105,000
is paid, all subsequent payments will convert into advance minimum royalty
payments that are credited against the 4% production royalty due. A 1% royalty
is also due Pescio on production on property consisting of a 2 mile
circumference surrounding the leased property.

The Company will pay additional land
acquisition and filling fees on the property. The Company is committed to drill
5,000 feet on the property in each year commencing on or before September 1,
2006 and continuing until the completion of the feasibility study. Excess
footage drilled in any year will be carried forward to subsequent years. The
Company has the option to pay Pescio $10 per foot committed to and not drilled.

Prior to the completion of the
feasibility study, the Company has the right to purchase 2% of the 4% production
royalty for $1,500,000 for each percentage point. The Company also has the
option to purchase 50% of the 1% royalty for $500,000.

The Company shall be responsible for
all environmental liabilities and reclamation costs it creates and indemnifies
Pescio against any such claims or obligations. The Company can terminate the
lease at any time by giving 30 days notice provided that there are no
outstanding environmental or reclamation liabilities and that all lease and
production royalty payments are current.

Jack Creek Property

On October 3, 2005, the Company paid
the Bureau of Land Management $30,875 as consideration on the Exploration
License and Option to Lease Agreement entered into between the Company and Mr.
Earl Abbott, and Stanley Keith (the owners), to explore 247 claims (nearly
5,000 acres) known as the Jack Creek Property. Mr. Abbott is the Companys
President and Mr. Keith is a Company Director.

Under the preliminary terms of this
agreement, the Company was granted a license to explore the property for a
period of six months to determine what claims, if any, it wishes to lease. The
term of the license is for six months, but the Company has the option to extend.

If the Company leases all of the 247
claims, it will be required to make the following advance lease payments:

|Due Date                     |   | Amount  | 
|---------------------------- | - | ------- | 
|Upon signing                 | $ | 22,500  | 
|1st anniversary              | $ | 30,000  | 
|2nd anniversary              | $ | 37,500  | 
|3rd anniversary              | $ | 50,000  | 
|4th anniversary              | $ | 62,500  | 
|5th anniversary and each     |   |         | 
|anniversary
      thereafter | $ | 100,000 | 

If any payments due by the Company to
the owners are not paid within 30 days of its due date, interest will begin to
accrue on the late payment at a rate of 2% over the prime rate established by
the Department of Business and Industry of the State of Nevada.

Upon completion of a bankable
feasibility study and payments totaling $140,000, all subsequent payments will
convert into advance minimum royalty payments that are credited against the 4%
production royalty due. A 1% royalty is also due the owners on production on
property consisting of a 2-mile circumference surrounding the leased property.

9

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The Company shall have the option to
purchase one-half (1/2) of the royalty applicable to the property representing
two percent (2%) of the Net Smelter Returns. The Company shall have the right to
elect to purchase such part of the royalty in increments representing one
percent (1%) of the Net Smelter Returns and the purchase price for each such
increment shall be $1,500,000. The Company shall have the option to purchase
one-half (1/2) of the area-of-interest royalty applicable to mineral rights,
mining claims and properties which the Company acquires from third parties
representing one-half percent (.5%) of the Net Smelter Returns. The purchase
price for such part of the area-of-interest royalty shall be $500,000 for the
one-half percent (.5%) of the area-of-interest royalty applicable to mineral
rights, mining claims and properties which the Company acquires from any third
party.

The Company shall be responsible for
all environmental liabilities and reclamation costs it creates and indemnifies
the owners against any such claims or obligations. The Company can terminate the
lease at any time by giving 30 days notice provided that there are no
outstanding environmental or reclamation liabilities and that all lease and
production royalty payments are current.

The terms and obligations disclosed
above are based upon preliminary agreements of the parties still under review
and may be subject to change.

Additional Properties

On October 6, 2005, the Company entered
into a preliminary agreement with Mr. Carl Pescio, a Director of the Company, to
lease 10 mineral properties (about 1,300 claims) in Nevada. Under the term of
the preliminary agreement, the Company is to make advance lease payments to Mr.
Pescio on each property based upon the following schedule:

|Due Date                 |   | Amount  | 
|------------------------ | - | ------- | 
|Upon signing             | $ | 35,000  | 
|1st anniversary          | $ | 55,000  | 
|2nd anniversary          | $ | 75,000  | 
|3rd anniversary          | $ | 100,000 | 
|4th anniversary          | $ | 125,000 | 
|5th anniversary          | $ | 150,000 | 
|6th anniversary and each |   |         | 
|anniversary thereafter   | $ | 200,000 | 

The above $35,000 advance in 2005 was
to be paid in installments of $5,000 upon signing. The remaining $30,000 was
paid in 2006. The Company is currently in renegotiations with Mr. Pescio to
finalize the actual terms of the 10 leases.

Based upon the actual terms of the
leases acquired in May 2004 and the preliminary terms of the leases acquired in
October 2005, the Companys obligation as of March 31, 2006 for the payment of
minimum lease payments on these 15 properties is as follows:

|2006                      | $ | 572,500   | 
|------------------------- | - | --------- | 
|2007                      | $ | 930,000   | 
|2008                      | $ | 1,237,500 | 
|2009                      | $ | 1,550,000 | 
|2010                      | $ | 1,862,500 | 
|Minimum lease payments in |   |           | 
|Subsequent years          | $ | 2,500,000 | 

A description of the mining properties
leased by the Company is as follows:

NT Green Property is located in
central Lander County, Nevada about 40 miles southwest of the town of Battle
Mountain. The property is within the Battle Mountain/Eureka (Cortez) Trend at
the northern end of the Toiyabe Range.

HMD Gold Property is located in
Eureka County, Nevada along the west side of the Cortez Range, about 30 miles
southwest of the town of Carlin, and about 10 miles north of the Buckhorn
deposit. Access to the property is gained by driving 41 miles west of Elko on
I-80, then 20 miles south on SH-306 to the town of Crescent Valley. A
well-maintained gravel road leads east-southeast past the Hot Springs Point to
the vicinity of the Dean Ranch. A two-track road leads to the southeast and the
property position is reached in about one-half mile.

10

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Goodwin Hill Gold Property is
located in east central Lander County, Nevada about 60 miles south of the town
of Battle Mountain and about 25 miles northeast of the town of Austin. It is
positioned in grass Valley between the Simpson Park Range to the east and the
Toiyabe Range to the west.

Wilson Peak property is located
in Elko County, Nevada about 70 miles north of the town of Elko and about 20
miles north of the town of Tuscarora. The property area is west of the
Independence Gold Trend and is part of a north-south line of gold-silver
occurrences in Tertiary volcanic rocks.

Jack Creek Property is located
in the northern Independence Range about 50 miles north of Elko, Elko County,
Nevada. It is comprised of 247 lode mining claims (nearly 5,000 acres) adjacent
to Gateway Gold Corp.s (TSX Venture:GTQ) Big Springs and Dorsey Creek
Properties.

Stargo Property is located in
the Monitor Range about 45 miles southwest of the town of Eureka and about 20
miles west of the Northumberland Mine and comprises of a total of 257 lode
claims (about 5,140 acres) in Nye County, Nevada.

West Whistler Property is
located on the west flank of Whistler Mountain, about 10 miles northwest of the
town of Eureka and comprises of a total of 103 lode claims (about 2,060 acres)
in Eureka County, Nevada.

Brock Property is located in the
Monitor Range about 36 miles southwest of the town of Eureka and about 24 miles
northeast of the Northumberland Mine and comprises a total of 222 lode claims
(about 4,440 acres) in Eureka County, Nevada.

Horseshoe Basin Property is
located in the Fish Creek Mountains about 30 miles south of the town of Battle
Mountain and about 4 miles south of the McCoy and Cove deposits.

South Lone Mountain Property is
located on the west flank of the Mountain Boy Range in Antelope Valley about 15
miles southwest of the town of Eureka and consists of a total of 140 lode claims
(about 2,800 acres) in Eureka County, Nevada.

Golconda Property is located in
Rock Creek Valley about 12 miles east of the town of Winnemucca and near the
intersection of the Getchell Trend and the north end of the Battle
Mountain-Eureka Trend and comprises of a total of 108 lode claims (about 2,160
acres) in Humboldt County, Nevada.

North Battle Mountain Property
is located in the Sheep Creek Range about 4 miles northeast of the town of
Battle Mountain near the northern extension of the Battle Mountain-Eureka
(Cortez) Trend and comprises a total of 73 lode claims (about 1,460 acres) in
Lander County, Nevada.

Dry Hills Property is located in
the Dry Hills about 20 miles southwest of the town of Carlin and comprises of a
total of 96 lode claims (about 1,920 acres) in Eureka County, Nevada.

Walti Property is located in
Grass Valley about 62 miles south of the town of Carlin and consists of a total
of 402 lode claims (about 8,040 acres) in Eureka and Lander Counties, Nevada.

Marr Property is located between
the Fish Creek Mountains and the Ravenswood Mountains about 50 miles southwest
of the town of Battle Mountain. The property is along the Western Nevada Rift
and consists of a total of 93 lode claims (about 1,840 acres) in Lander County,
Nevada.

As of March 31, 2006, the Company
incurred a total of $944,333 in acquisition costs. The Company has recently
commenced exploration of its properties and has yet to determine whether any of
its properties are commercially feasible. In order for the Company to complete
its analysis, additional funding is required.

Note 4 - Notes Payable

On July 1, 2005, the Company borrowed
$100,000 from Gatinara Holdings, Inc., an unrelated third party. The loan is
evidenced by an unsecured promissory note. The note accrues interest at 8% per
annum and matures on December 31, 2006. Accrued interest related to this note as
of March 31, 2006 amounted to $5,984.

11

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From August 9, 2005 to October 5, 2005,
the Company borrowed a total of $330,978 from Greenshoe Investment, Inc., an
unrelated third party. The loans are evidenced by unsecured promissory notes.
The notes accrue interest at 8% per annum and mature on December 31, 2006.
Accrued interest related to these notes as of March 31, 2006 amounted to
$15,204.

During the three months ended March 31,
2006, the Company borrowed a total of $649,838 from Greenshoe Investment, Inc.
The loans are evidenced by unsecured promissory notes. The notes accrue interest
at 8% per annum and mature on December 31, 2006. Accrued interest related to
these notes as of March 31, 2006 amounted to $7,679.

Note 5 - Stockholders' Equity

Common Stock

On April 19, 2004, the Company
authorized a 50-for-1 stock split. On August 18, 2004, the Company authorized a
6.82 -for-1 stock split. On May 16, 2005, the Company authorized a 1.20 -for-1
stock split. In addition, the Company increased it authorized shares to
100,000,000. The accompanying financial statements have been retroactively
restated to present the effect of these three stock splits.

On April 15, 2005, the Company's
officers and directors agreed to redeem an aggregate of 27,172,800 of their
shares for $7,906 or $.0002909 per share. The shares includes 13,586,400 shares
from Dr. Abbott, and 6,793,200 shares from each of Messrs. Pescio and Keith. Dr.
Abbott's shares were redeemed for $3,954, and Messrs. Pescio and Keith each
received $1,976 for their shares. These amounts are the equivalent to the
pre-split prices they paid for their shares when they joined the Company in
March 2004. The $7,906 was paid during the three months ended September 30,
2005.

In April 15, 2005, the holders of the
notes payable converted the principal amount of the notes totaling $1,025,000
and accrued interest of $79,271 into 1,325,126 shares of the Company's common
stock.

In the fourth quarter of 2005, the
Company sold 625,000 shares of common stock to an investor for total cash
proceeds of $500,000. In connection with this transaction, the Company also
issued to this investor a warrant to purchase 625,000 shares of common stock for
$0.85 per shares. As of December 31, 2005, the Company received $499,582. The
remaining $418 has been charged to equity and included in subscription
receivable.

Options and Warrants:

In March 2004, the Company issued
60,000 options to former employees of the Company. The fair value for these
options was estimated to be $4,540 and has been recorded as an expense in the
accompanying statement of operations. The fair value was estimated using a
Black-Scholes option pricing model with the following weighted-average
assumptions: risk-free interest rate of 5.5%; dividend yields of 0%; volatility
factors of the expected market price of the Company's common stock of 50%; and a
weighted average expected life of the option of 10 years, respectively.

In accordance with a consulting
agreement with Access Capital Management Corp., the Company issued Access
Capital, 25,000 options in September 2005 to purchase shares of the Companys
common stock for $0.75 per shares. These options were valued using the
Black-Scholes option pricing model using the following assumptions: term of
1,853 days, a risk-free interest rate of 3.85%, a dividend yield of 0% and
volatility of 63%. The value of these options of $12,075 was amortized over the
three-month initial term of the agreement and was charged to operations in 2005.

In December 2005, the Company extended
the term of the agreement and granted

Access an additional 125,000 options to
purchase shares of the Companys common stock at a price of $0.75 per shares.
These options were valued using the Black-Scholes option pricing model using the
following assumptions: term of 1,762 days, a risk-free interest rate of 4.45%, a
dividend yield of 0% and volatility of 71%. These options were valued $52,150
and are being amortized over the nine month remaining term of the agreement. In
2005, $5,794 was charged to operations in 2005.

The 150,000 options granted in 2005
expire on September 28, 2010 unless Access Capital no longer provides services
for the Company whereby the options expire one year from the date of
termination.

As discussed above, in connection with
the issuance of the 625,000 shares of the Companys common stock, the Company
granted 625,000 warrants to purchase shares of the Companys common stock at
$.85 per share.

In June 2006, former management
exercised some of their options to purchase a total of 24,800 shares of the
Companys common stock at a price of $.15 per share.

12

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The following table summarizes the
options and warrants outstanding:

|                            |  |             |   |  | Weighed  |  
|--------------------------- |  | ----------- | - |  | -------- | -
|                            |  | Options/    |   |  | Average  |  
|                            |  | Warrants    |   |  | Exercise |  
|                            |  | Outstanding |   |  | Price    |  
|Balance - December 31, 2004 |  | 60,000      |   |  | 0.1500   |  
|Granted                     |  | 775,000     |   |  | 0.8306   |  
|Exercised                   |  |            |   |  |          |  
|Forfeited                   |  |            |   |  |          |  
|Balance - December 31, 2005 |  | 835,000     |   |  | 0.7817   |  
|Granted                     |  |            |   |  |          |  
|Exercised                   |  | (24,800     | ) |  | (0.1500  | )
|Forfeited                   |  |            |   |  |          |  
|Balance - March 31, 2006    |  | 810,200     |   |  | 0.801    |  

Note 6 - Income Taxes

Deferred income taxes reflect the net
tax effects of temporary differences between the carrying amounts of assets and
liabilities for financial statement purposes and the amounts used for income tax
purposes. Significant components of the Company's deferred tax liabilities and
assets as of March 31, 2006 are as follows:

|Deferred tax assets:     |   |          |  
|------------------------ | - | -------- | -
|Net operating loss       | $ | 268,500  |  
|Less valuation allowance |   | (268,500 | )
|                         | $ |         |  

At March 31, 2006, the Company had
federal net operating loss ("NOL") carryforwards of approximately $790,000.
Federal NOLs could, if unused, begin to expire in 2017.

The valuation allowance increased by
approximately $48,000 and $22,000 during the three-months ended March 31, 2006
and 2005, respectively.

Utilization of the net operating loss
and tax credit carryforwards is subject to significant limitations imposed by
the change in control under I.R.C. 382, limiting its annual utilization to the
value of the Company at the date of change in control times the federal discount
rate.

Note 7 - Related Party Transactions

During the three months ended March 31,
2006 and 2005, the Company had the following transactions with related parties:

As discussed in Note 3, the Company
entered into agreements with a company owned by Mr. Carl Pescio, a Director of
the Company, to acquire mining claims. During the three months ended March 31,
2006, the Company paid Mr. Pescio $420,000 related to these agreements.

13

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During the three months ended March 31,
2006, the Company incurred consulting fees for services rendered by Mr. Earl
Abbott, the Company's President, totaling $66,579 of which $30,992 related to
mining exploration and the remaining $35,587 related to general administrative
activities. During the three months ended March 31, 2005, the Company incurred
consulting fees for services rendered by Mr. Earl Abbott, the Companys
President, totaling $23,100 of which $17,850 related to mining exploration and
the remaining $5,250 was charged to general administrative activities. The
Company also during the three months ended March 31, 2005 reimbursed Mr. Abbott
$7,809.39 for travel and other company related expenses.

During the three months ended March 31,
2006, the Company paid a $10,000 consulting fee to George Drazenovic, the
Companys Chief Financial Officer.

14

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Item 2. Management's Discussion and Analysis or Plan of
Operations

THIS FOLLOWING INFORMATION SPECIFIES CERTAIN FORWARD-LOOKING
STATEMENTS OF MANAGEMENT OF THE COMPANY. FORWARD-LOOKING STATEMENTS ARE
STATEMENTS THAT ESTIMATE THE HAPPENING OF FUTURE EVENTS ARE NOT BASED ON
HISTORICAL FACT. FORWARD-LOOKING STATEMENTS MAY BE IDENTIFIED BY THE USE OF
FORWARD-LOOKING TERMINOLOGY, SUCH AS "MAY", "SHALL", "COULD", "EXPECT",
"ESTIMATE", "ANTICIPATE", "PREDICT", "PROBABLE", "POSSIBLE", "SHOULD",
"CONTINUE", OR SIMILAR TERMS, VARIATIONS OF THOSE TERMS OR THE NEGATIVE OF THOSE
TERMS. THE FORWARD-LOOKING STATEMENTS SPECIFIED IN THE FOLLOWING INFORMATION
HAVE BEEN COMPILED BY OUR MANAGEMENT ON THE BASIS OF ASSUMPTIONS MADE BY
MANAGEMENT AND CONSIDERED BY MANAGEMENT TO BE REASONABLE. OUR FUTURE OPERATING
RESULTS, HOWEVER, ARE IMPOSSIBLE TO PREDICT AND NO REPRESENTATION, GUARANTY, OR
WARRANTY IS TO BE INFERRED FROM THOSE FORWARD-LOOKING STATEMENTS.

THE ASSUMPTIONS USED FOR PURPOSES OF THE FORWARD-LOOKING
STATEMENTS SPECIFIED IN THE FOLLOWING INFORMATION REPRESENT ESTIMATES OF FUTURE
EVENTS AND ARE SUBJECT TO UNCERTAINTY AS TO POSSIBLE CHANGES IN ECONOMIC,
LEGISLATIVE, INDUSTRY, AND OTHER CIRCUMSTANCES. AS A RESULT, THE IDENTIFICATION
AND INTERPRETATION OF DATA AND OTHER INFORMATION AND THEIR USE IN DEVELOPING AND
SELECTING ASSUMPTIONS FROM AND AMONG REASONABLE ALTERNATIVES REQUIRE THE
EXERCISE OF JUDGMENT. TO THE EXTENT THAT THE ASSUMED EVENTS DO NOT OCCUR, THE
OUTCOME MAY VARY SUBSTANTIALLY FROM ANTICIPATED OR PROJECTED RESULTS, AND,
ACCORDINGLY, NO OPINION IS EXPRESSED ON THE ACHIEVABILITY OF THOSE
FORWARD-LOOKING STATEMENTS. NO ASSURANCE CAN BE GIVEN THAT ANY OF THE
ASSUMPTIONS RELATING TO THE FORWARD-LOOKING STATEMENTS SPECIFIED IN THE
FOLLOWING INFORMATION ARE ACCURATE, AND WE ASSUME NO OBLIGATION TO UPDATE ANY
SUCH FORWARD-LOOKING STATEMENTS.

CRITICAL ACCOUNTING POLICIES

Our Management's Discussion and Analysis or Plan of Operation
section discusses our financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States of
America. The preparation of these financial statements requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. On an on-going basis,
management evaluates its estimates and judgments, including those related to
revenue recognition, accrued expenses, financing operations, and contingencies
and litigation. Management bases its estimates and judgments on historical
experience and on various other factors that are believed to be reasonable under
the circumstances, the results of which form the basis for making judgments
about the carrying value of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates under
different assumptions or conditions. The most significant accounting estimates
inherent in the preparation of our financial statements include estimates as to
the appropriate carrying value of certain assets and liabilities which are not
readily apparent from other sources, accruals for other costs, and the
classification of net operating loss and tax credit carry forwards between
current and long-term assets. These accounting policies are more fully described
in the notes to the financial statements included in our Annual Report on Form
10-KSB for the fiscal year ended December 31, 2005.

MINING COSTS

Costs incurred to purchase, lease or otherwise acquire property
are capitalized when incurred. General exploration costs and costs to maintain
rights and leases are expensed as incurred. Management periodically reviews the
recoverability of the capitalized mineral properties and mining equipment.
Management takes into consideration various information including, but not
limited to, historical production records taken from previous mine operations,
results of exploration activities conducted to date, estimated future prices and
reports and opinions of outside consultants. When it is determined that a
project or property will be abandoned or its carrying value has been impaired, a
provision is made for any expected loss on the project or property.

OVERVIEW. We were incorporated in Nevada on October 8, 2001 in
order to serve as a holding company for Salty's Warehouse, Inc., which sells
consumer electronics products and other name brand consumer products over the
Internet.

On March 19, 2004, pursuant to a Plan of Reorganization and
Acquisition, we disposed of our operating asset, Salty's Warehouse, Inc., when
our prior management departed. Under our new management, we undertook a
different business focus: the identification and acquisition of properties
exhibiting the potential for gold mining operations by others. On July 7, 2004,
we changed our name from Nucotec, Inc. to Tornado Gold International Corp. to
reflect our new business focus. The name change was approved on May 12, 2004, by
unanimous approval of our Board of Directors. In addition, shareholders holding
a majority of our outstanding common stock approved those actions by written
consent in lieu of a meeting on May 12, 2004, in accordance with the relevant
sections of the Nevada Revised Statutes.

15

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LIQUIDITY AND CAPITAL RESOURCES. We had cash and cash
equivalents totaling $181,165 as of March 31, 2006 and had prepaid our office
lease and attorney fees totaling $5,306, making our total current assets
$186,471. We also had mining assets of $944,333, making our total assets
$1,130,804 as of March 31, 2006. We believe that our available cash and cash
equivalents are not sufficient to pay our day-to-day expenditures. We are
committed to seek the necessary financing needed to continue operating through
the sale of equity or debt financing, though there is no guarantee we will be
able to do so.

As of March 31, 2006, we had a net working capital deficit of
$946,189 as compared to $1,089,940 of March 31, 2005.

Net cash used in operating activities was $113,006 for the
three months ended March 31, 2006 compared to $32,940 for the three months ended
March 31, 2005.

Since we have no current source of revenue, our only source of
cash is from the issuance of debt or equity instruments. During the three months
ended March 31, 2006, we borrowed $649,838 compared to the $50,000 we borrowed
during the three months ended March 31, 2005. We used $420,000 to make advance
lease payments and acquisition costs on our mining claims during the three
months ended March 31, 2006 compared to $43,314 we incurred during the three
months ended March 31, 2005.

Due to numerous economic and competitive risks, any or all of
which may have a material adverse impact upon our operations, there can be no
assurance that we will be able to successfully generate significant revenues or
achieve a level of profits which will permit us to stay in business. In March
2004, our management team changed. Under our new management, we undertook a
different business focus:

the identification and acquisition of properties exhibiting the
potential for gold mining operations by others. However, due to the change in
our business plan, we must raise additional capital in order to have resources
sufficient to fund all of our general and administrative expenses for the next
twelve months.

No assurances can be given that we will be able to obtain
sufficient working capital trough the sale of our common stock and borrowing or
that the development and implementation of our business plan will generate
sufficient revenues in the future to sustain ongoing operations. These factors
raise substantial doubt with our auditor about our ability to continue as a
going concern.

RESULTS OF OPERATIONS.

FOR THE THREE MONTHS ENDED MARCH 31, 2006 COMPARED TO THE
THREE MONTHS ENDED MARCH 31, 2005.

REVENUE. We have realized no revenues for the three months
ended March 31, 2006 and 2005.

OPERATING EXPENSES. For the three months ended March 31, 2006,
our total operating expenses were $123,770 compared to our total operating
expenses incurred during the three months ended March 31, 2005 of $45,975. Of
the $123,770 incurred in 2006, $39,960 related to our mining exploration and
$83,810 was incurred in general and administrative activities. Of the $45,975
incurred in 2005, $17,850 related to mining exploration and $28,125 related to
general and administrative activities. During the three months ended March 31,
2006, we accrued $16,181 in interest expenses on notes payable compared to
interest accruing during the three months ended March 31, 2005 of $19,638. No
interest has been paid on notes payable during either quarter.

Of the $39,960 that we incurred in our mining operations during
the three months ended March 31, 2006, $30,992 relates to technical consulting
services rendered by our President. Of the $83,810 that we incurred in general
and administrative expenses during the three-months ended March 31, 2006,
$35,587 relates to management services rendered by our President, and $10,000
relates to services rendered by our Chief Financial Officer. Other general and
administrative expenses incurred in 2006 include investor relations fees of
$6,231, consulting fees of $3,000, accounting and auditing fees of $15,344,
legal fees of $2,415, rent expense of $4,187, and fees paid to the staffing
agency for the services rendered by our President's assistant during the
three-month period amounting to $4,802.

Of the $17,850 that we incurred in our mining operations during
the three months ended March 31, 2005, $17,850 relates to technical services
rendered by our president. Of the $28,125 that we incurred in general and
administrative expenses, $5,250 is attributable to our President for management
services, $4,392 was incurred for accounting and legal professional services,
rent expense of $4,185, and travel and other related company expenses which were
reimbursed to our President totaling $7,809.

OFF-BALANCE SHEET ARRANGEMENTS. There are no off balance sheet
arrangements that have or are reasonably likely to have a current or future
effect on our financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that are material to investors; except for our commitment to lease
certain mining property that require us to make substantial lease payments in
the future as disclosed in Note 3 to the financial statements included elsewhere
in this Quarterly Report on Form 10-QSB.

16

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Item 3. Controls and Procedures

Under the supervision and with the participation of our
management, including our principal executive officer and the principal
financial officer, we have conducted an evaluation of the effectiveness of the
design and operation of our disclosure controls and procedures, as defined in
Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of
the end of the period covered by this report. Based on this evaluation, our
principal executive officer and principal financial officer concluded as of the
evaluation date that our disclosure controls and procedures were effective such
that the material information required to be included in our Securities and
Exchange Commission reports is recorded, processed, summarized and reported
within the time periods specified in SEC rules and forms relating to our
company, including any consolidating subsidiaries, and was made known to us by
others within those entities, particularly during the period when this report
was being prepared.

Additionally, there were no significant changes in our internal
controls or in other factors that could significantly affect these controls
subsequent to the evaluation date. We have not identified any significant
deficiencies or material weaknesses in our internal controls, and therefore
there were no corrective actions taken.

PART II. OTHER INFORMATION

Part
II.             
OTHER INFORMATION

Item
6.              Exhibits

|Exhibit |                                                                      
|------- | ---------------------------------------------------------------------
|Number  | Description of Document                                              
|        |                                                                      
|31.1    | Certification pursuant
      to Section 302 of the Sarbanes-Oxley Act
|        |                                                                      
|31.2    | Certification pursuant
      to Section 302 of the Sarbanes-Oxley Act
|        |                                                                      
|32.1    | Certification pursuant
      to Section 906 of the Sarbanes-Oxley Act

17

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SIGNATURES

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

|               | **TORNADO GOLD INTERNATIONAL CORP.**
|-------------- | ------------------------------------
|               |                                     
|               |                                     
|March 23, 2007 | By:                                 
|               |                                     
|               |                                     
|               |                                     
|               |                                     

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