----

|  | £ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--|--------|------------------------------------------------------------------------------------------------|

|  | T | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2016 |
|--|---|----------------------------------------------------------------------------------------------------------------------------------|

|  | £ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--|--------|------------------------------------------------------------------------------------------|

|  | £ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--|--------|--------------------------------------------------------------------------------------------------|

| Common Shares       | NYSE MKT, Toronto Stock Exchange, Frankfurt Stock Exchange |
|---------------------|------------------------------------------------------------|
| Title of each class | Name of each exchange on which registered                  |

----

| U.S. GAAP £ | International Financial Reporting Standards as issued | Other £ |
|------------------|-------------------------------------------------------|--------------|
|             | By the International Accounting Standards Board T     |         |
|             |                                                  |         |

----

| INTRODUCTION AND USE OF CERTAIN TERMS             | 4                                                                           |
|---------------------------------------------------|-----------------------------------------------------------------------------|
|                                              |                                                                        |
| FORWARD-LOOKING STATEMENTS                        | 4                                                                           |
|                                              |                                                                        |
| CAUTIONARY NOTE ON RESOURCE AND RESERVE ESTIMATES | 5                                                                           |
|                                              |                                                                        |
| TECHNICAL INFORMATION                             | 5                                                                           |
|                                              |                                                                        |
| CURRENCY                                          | 5                                                                           |
|                                              |                                                                        |
| PRESENTATION OF FINANCIAL INFORMATION             | 5                                                                           |
|                                              |                                                                        |
| PART I                                            | 5                                                                           |
| Item 1.                                           | Identity of Directors, Senior Management and Advisers                       | 5 |
| Item 2.                                           | Offer Statistics and Expected Timetable                                     | 5 |
| Item 3.                                           | Key Information                                                             | 6 |
| Item 4.                                           | Information on the company                                                  | 12 |
| Item 4A                                           | Unresolved Staff Comments                                                   | 19 |
| Item 5                                            | Operating and Financial Review and Prospects                                | 19 |
| Item 6.                                           | Directors, Senior Management and Employees                                  | 25 |
| Item 7.                                           | Major Shareholders and Related Party Transactions                           | 29 |
| Item 8.                                           | Financial Information                                                       | 30 |
| Item 9.                                           | The Offer and Listing                                                       | 31 |
| Item 10.                                          | Additional Information                                                      | 31 |
| Item 11.                                          | Quantitative and Qualitative Disclosures About Market Risk                  | 38 |
| Item 12.                                          | Description of Securities Other than Equity Securities                      | 39 |
|                                              |                                                                        |
| PART II                                           | 39                                                                          |
| Item 13.                                          | Defaults, Dividend Arrearages and Delinquencies                             | 39 |
| Item 14.                                          | Material Modifications to the Rights of Security Holder and Use of Proceeds | 39 |
| Item 15.                                          | Controls and Procedures                                                     | 39 |
| Item 16A                                          | Audit Committee Financial Expert                                            | 40 |
| Item 16B                                          | Code of Ethics - Board of Directors and officers                            | 40 |
| Item 16C                                          | Principal Accountant Fees and Services                                      | 40 |
| Item 16D                                          | Exemptions from the Listing Standards                                       | 40 |
| Item 16E                                          | Purchases of Equity Securities by  the Issuer and Affiliate Purchasers | 41 |
| Item 16F                                          | Change in Registrant’s certifying accountant                          | 41 |
| Item 16G                                          | Corporate Governance                                                        | 41 |
| Item 16H                                          | Mine Safety                                                                 | 41 |
|                                              |                                                                        |
| PART III                                          | 42                                                                          |
| Item 17.                                          | Financial Statements                                                        | 42 |
| Item 18.                                          | Financial Statements                                                        | 42 |
| Item 19.                                          | Exhibits                                                                    | 43 |

----

----

----

|                                                     |   |   |       |   | Fiscal Year ended December 31, |   |       |   |   |
|----------------------------------------------------------|--------|--------|------------|--------|--------------------------------|--------|------------|--------|--------|
|                                                     |   | 2016   |       |   | 2015                           |   |       | 2014   |   |   | 2013 |   |   | 2012 |   |
|                                                     |   | $      |       |   |                           | $      |       |   |   | $ |   |   |   | $ |   |   |   | $ |   |   |
| Operations Data                                          |   |   |       |   |                           |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss from investments at fair value (i)                  |   |   | (990,000   | )      |                           |   | -          |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Operating loss (ii)                                      |   |   | (1,585,106 | )      |                           |   | (2,273,317 | )      |   |   | (2,484,102 | ) |   |   | (2,298,719 | ) |   |   | (4,002,930 | ) |
| Finance andother income (expense) (ii)(iii)              |   |   | 8,802,174  |   |                           |   | 16,593,873 |   |   |   | (5,013,692 | ) |   |   | (644,586 | ) |   |   | (868,502 | ) |
| Income (loss) from continuing operations                 |   |   | 7,217,068  |   |                           |   | 14,320,556 |   |   |   | (7,497,794 | ) |   |   | (2,943,305 | ) |   |   | (4,871,432 | ) |
| Income from discontinued operations                      |   |   | -          |   |                           |   | -          |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Net income (loss)                                        |   |   | 7,217,068  |   |                           |   | 14,320,556 |   |   |   | (7,497,794 | ) |   |   | (2,943,305 | ) |   |   | (4,871,432 | ) |
| Income (loss) per Common sharefrom continuing operations |   |   |       |   |                           |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   -basic and diluted                           |   |   | 0.14       |   |                           |   | 0.28       |   |   |   | (0.15 | ) |   |   | (0.06 | ) |   |   | (0.10 | ) |
| Net income (loss) per Common share (basic and diluted)   |   |   | 0.14       |   |                           |   | 0.28       |   |   |   | (0.15 | ) |   |   | (0.06 | ) |   |   | (0.10 | ) |
| Common shares used in calculations                       |   |   |       |   |                           |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                    |   |   | 50,687,496 |   |                           |   | 50,566,749 |   |   |   | 50,488,078 |   |   |   | 50,348,215 |   |   |   | 50,348,215 |   |
| Diluted                                                  |   |   | 52,510,830 |   |                           |   | 50,566,749 |   |   |   | 50,488,078 |   |   |   | 50,348,215 |   |   |   | 50,348,215 |   |

| Total assets             |   |   | 20,758,471 |   |   |   | 16,521,288 |   |   |   | 9,405,439  |   |   |   | 16,246,355 |   |   |   | 19,171,997 |   |
|--------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|
| Total liabilities        |   |   | 211,427    |   |   |   | 566,852    |   |   |   | 4,502,225  |   |   |   | 4,304,484  |   |   |   | 8,707,332  |   |
| Non-controlling interest |   |   | -          |   |   |   | -          |   |   |   | 4,988,512  |   |   |   | 5,124,196  |   |   |   | 2,425,368  |   |
| Net assets               |   |   | 20,547,044 |   |   |   | 15,954,436 |   |   |   | 4,903,214  |   |   |   | 11,941,871 |   |   |   | 10,464,665 |   |
| Share capital            |   |   | 41,976,886 |   |   |   | 41,911,823 |   |   |   | 41,882,757 |   |   |   | 41,758,037 |   |   |   | 41,758,037 |   |
| Dividends                |   |   | -          |   |   |   | -          |   |   |   | -          |   |   |   | -          |   |   |   | -          |   |

----

| Year Ended December 31 |   | Average |   |   | Period End |   |   | High   |   |   | Low    |   |
|------------------------|--------|---------|--------|--------|------------|--------|--------|--------|--------|--------|--------|--------|
| 2016                   |   |    | 1.3248 |   |       |   | 1.3427 |   |   |   | 1.4589 |   |   |   | 1.2544 |   |
| 2015                   |   |    | 1.2787 |   |       |   | 1.3840 |   |   |   | 1.3390 |   |   |   | 1.1728 |   |
| 2014                   |   |    | 1.1045 |   |       |   | 1.1601 |   |   |   | 1.1643 |   |   |   | 1.0614 |   |
| 2013                   |   |    | 1.0299 |   |       |   | 1.0636 |   |   |   | 1.0697 |   |   |   | 0.9839 |   |
| 2012                   |   |    | 0.9996 |   |       |   | 0.9949 |   |   |   | 1.0418 |   |   |   | 0.9710 |   |
|  Month    |   | Average |   |   | Period End |   |   | High   |   |   | Low    |   |
|----------------|--------|---------|--------|--------|------------|--------|--------|--------|--------|--------|--------|--------|
| February 2017  |   |    | 1.3110 |   |       |   | 1.3248 |   |   |   | 1.3248 |   |   |   | 1.3004 |   |
| January 2017   |   |    | 1.3191 |   |       |   | 1.3030 |   |   |   | 1.3438 |   |   |   | 1.3030 |   |
| December 2016  |   |    | 1.3329 |   |       |   | 1.3427 |   |   |   | 1.3556 |   |   |   | 1.3120 |   |
| November 2016  |   |    | 1.3438 |   |       |   | 1.3426 |   |   |   | 1.3582 |   |   |   | 1.3337 |   |
| October 2016   |   |    | 1.3251 |   |       |   | 1.3403 |   |   |   | 1.3403 |   |   |   | 1.3104 |   |
| September 2016 |   |    | 1.3109 |   |       |   | 1.3117 |   |   |   | 1.3248 |   |   |   | 1.2843 |   |

----

----

----

----

----

----

| 1. |  To seek a high return on investment opportunities, primarily in the mining and natural resource sector; and, |
|----|--------------------------------------------------------------------------------------------------------------------|

| 2. | to preserve capital and limit downside risk while achieving a reasonable rate of return by focusing on opportunities with attractive risk to reward profiles. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Investment Sector:                                                                                                                                                                        | Natural resources industry, primarily mining but all businesses classified as natural resources may be considered for investment purposes.                                                                                                                                                                            |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Investment Types:                                                                                                                                                                         | Equity, debt, royalties, income and commodity streams, derivatives and any other investment structures or instruments that could be acquired or created.                                                                                                                                                              |
| Commodities:                                                                                                                                                                              | All commodities that comprise natural resources. Such commodities may include, but are not limited to, precious metals, base metals, ferrous metals, non-ferrous metals, industrial metals, non-industrial metals, agricultural minerals, industrial minerals, other minerals, oil, gas, water and forestry products. |
| Jurisdictions:                                                                                                                                                                            | All countries are permissible depending on the risk assessment of the Board and Management at the time the investment is made and the risk-reward relationship associated with each investment in a particular jurisdiction.                                                                                          |
| Investment Size:                                                                                                                                                                          | Unlimited, which may result in the Company holding a control position in a target corporation or possibly requiring future equity or debt financings to raise money for specific investments.                                                                                                                         |
| Investment Timeline:                                                                                                                                                                      | Not limited.                                                                                                                                                                                                                                                                                                          |
| Investment Targets:                                                                                                                                                                       | Direct project investments either through direct equity in a project, or through a derivative interest such as a royalty, stream or other derivative facility.                                                                                                                                                        |
| Investments in public or private corporations, partnership or other legal entities which own, or propose to own, natural resource assets or derivatives of natural resource assets.  |
| Distressed situations where a change of management or other restructuring is required to realize the value of the asset.                                                                  |
| Investment Review:                                                                                                                                                                        | Will seek to maintain the ability to actively review and revisit all of investments on an ongoing basis.                                                                                                                                                                                                              |
| Liquidity:                                                                                                                                                                                | Will evaluate the liquidity of investments and seek to realize value from same in a prudent and orderly fashion.                                                                                                                                                                                                      |

----

|                                                   |   | 2016   |       |   | 2015   |   |
|--------------------------------------------------------|--------|--------|------------|--------|--------|--------|
|                                                   |   | $      |       |   |   | $      |   |   |
| Current:                                               |   |   |       |   |   |   |   |   |
|     Investment in Minco Silver     |   |   | 11,770,000 |   |   |   | - |   |
| Non-current:                                           |   |   |       |   |   |   |   |   |
|    Investment in EI Olivar Imperial SAC |   |   | 537,860    |   |   |   | - |   |
| Total                                                  |   |   | 12,307,860 |   |   |   | - |   |

| 1) | Investment in Minco Silver: |
|----|-----------------------------|

|                                                                                                |   | 2016   |       |   | 2015   |   |       | 2014   |   |
|-----------------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|
| Carrying value, as at January 1,                                                                    |   | $      | 6,631,094  |   |   | $      | 6,820,000  |   |   | $ | 13,368,836 |   |
| Dilution loss                                                                                       |   |   | (98,899    | )      |   |   | -          |   |   |   | (78,177 | ) |
| Share of Minco Silver’s income (loss)                                                         |   |   | (408,225   | )      |   |   | 1,259,391  |   |   |   | (321,972 | ) |
| Share of Minco Silver’s other comprehensive income                                            |   |   | (1,345,417 | )      |   |   | 1,958,940  |   |   |   | 115,462 |   |
| Partial disposition                                                                                 |   |   |       |   |   |   | -          |   |   |   | (2,058,333 | ) |
| Unrealized gain on disposition of Minco Resources                                                   |   |   | -          |   |   |   | (3,407,237 | )      |   |   | - |   |
| Impairment                                                                                          |   |   | -          |   |   |   | -          |   |   |   | (4,205,816 | ) |
| Difference of the carrying value ($4,778,533) and the fair value ($12,760,000) on November 11, 2016 |   |   | 7,981,447  |   |   |   | N/A        |   |   |   | N/A |   |
| Unrealized loss from November 11, 2016 to December 31, 2016                                         |   |   | (990,000   | )      |   |   | N/A        |   |   |   | N/A |   |
| Carrying value, as at December 31,                                                                  |   | $      | 11,770,000 |   |   | $      | 6,631,094  |   |   | $ | 6,820,000 |   |
| Number of shares owned, December 31                                                                 |   |   | 11,000,000 |   |   |   | 11,000,000 |   |   |   | 11,000,000 |   |
| Percentage of ownership, December 31,                                                               |   |   | 18.26      | %      |   |   | 18.45      | %      |   |   | 18.45 | % |
| 2) | Investment in EI Olivar: |
|----|--------------------------|

----

| · | February 17, 2017 – Investment of $750,000 in Hudson Resources Inc., a Canadian public company, through a private placement of 2,142,285 units at a price of $0.35 per unit. Each unit comprised one common share and one-half of a transferable share purchase warrant that is exercisable into one additional common share until February 16, 2020, at $0.50 per share. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | March 2, 2017 - Investment of $84,000 in Barkerville Gold Mines Ltd., a Canadian public company, through the purchase of 200,000 common shares at $0.42 per share in the open market.   |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| i) | Yangshan: including four exploration permits located in the northeast extension of the Yangshan gold belt and its adjacent area; |
|----|----------------------------------------------------------------------------------------------------------------------------------|

| ii) | Yejiaba: including four exploration permits adjacent to the Guojiagou exploration permit; and |
|-----|-----------------------------------------------------------------------------------------------|

| iii) | Xicheng East: including one exploration permit to the east extension of the Xicheng Pb-Zn mineralization belt. |
|------|----------------------------------------------------------------------------------------------------------------|

|                       |   |         |    |   |         |   |    |         |   |   | Cumulative to |   |
|----------------------------|--------|--------------|---------|--------|--------------|--------|---------|--------------|--------|--------|---------------|--------|
|                       |   | December 31, |    |   | December 31, |   |    | December 31, |   |   | December 31,  |   |
|                       |   | 2016         |    |   | 2015         |   |    | 2014         |   |   | 2016          |   |
|                       |   |         | $       |   |         |   | $  |         |   |   | $        |   |   |   | $ |   |
| Gansu - Longnan            |   |         | 195,248 |   |         |   | 626,815 |         |   |   | 894,646       |   |   |   | 12,527,397 |   |
| Guangdong- Changkeng       |   |         | -       |   |         |   | 122652  |         |   |   | 244784        |   |   |   | 8,285,703 |   |
| Hunan - Gold Bull Mountain |   |         | 21,862  |   |         |   | 43,508  |         |   |   | 36,862        |   |   |   | 2,338,473 |   |
| Guangdong - Sihui          |   |         | -       |   |         |   | 106     |         |   |   | 1,525         |   |   |   | 6,099 |   |
|  Total                |   |         | 217,110 |   |         |   | 793,081 |         |   |   | 1,177,817     |   |   |   | 23,157,672 |   |

----

----

----

| Year ended December 31,             |   | 2016   |      |   | 2015   |   |       | Year to year change 2016-2015 |   |
|-------------------------------------|--------|--------|-----------|--------|--------|--------|------------|-------------------------------|--------|
|                                |   | $      |      |   |   | $      |       |                          |   | $ |   |   |
| Loss from investments at fair value |   |   | (990,000  | )      |   |   | -          |                          |   |   | (990,000 | ) |
| Operating expenses                  |   |   | (595,106  | )      |   |   | (2,273,317 | )                             |   |   | 1,678,211 |   |
| Other income                        |   |   | 8,802,174 |   |   |   | 16,593,873 |                          |   |   | (7,791,699 | ) |
| Net income for the year             |   |   | 7,217,068 |   |   |   | 14,320,556 |                          |   |   | (7,103,488 | ) |
| Year ended December 31,        |   | 2015   |       |   | 2014   |   |       | Year to year change 2015-2014 |   |
|--------------------------------|--------|--------|------------|--------|--------|--------|------------|-------------------------------|--------|
|                           |   | $      |       |   |   | $      |       |                          |   | $ |   |   |
| Operating expenses             |   |   | (2,273,317 | )      |   |   | (2,484,102 | )                             |   |   | 210,785 |   |
| Other income (loss)            |   |   | 16,593,873 |   |   |   | (5,013,692 | )                             |   |   | 21,607,565 |   |
| Net income (loss) for the year |   |   | 14,320,556 |   |   |   | (7,497,794 | )                             |   |   | 21,818,350 |   |

----

|                               |   |      |   |   |     |   |   |   |      |   |   |   | Year to year change |        |
|------------------------------------|--------|-----------|--------|--------|----------|--------|--------|--------|-----------|--------|--------|--------|---------------------|-------------|
|                               |   |  ref |   | 2016   |     |   | 2015   |   |      | 2014   |   |   |                | 2016 - 2015 |   |   |   | 2015 - 2014 |   |
|                               |   |      |   | $      |     |   |   | $      |      |   |   | $      |                |        |   | $ |   |   |   | $ |   |   |
| Accounting and audit               |   | a         |   |   | 99,959   |   |   |   | 152,777   |   |   |   | 105,423             |        |   |   | (52,818 | ) |   |   | 47,354 |   |
| Amortization                       |   |      |   |   | 3,362    |   |   |   | 34,781    |   |   |   | 67,180              |        |   |   | (31,419 | ) |   |   | (32,399 | ) |
| Consulting                         |   | b         |   |   | 61,537   |   |   |   | 78,267    |   |   |   | 11,633              |        |   |   | (16,730 | ) |   |   | 66,634 |   |
| Directors’ fees              |   |      |   |   | 59,138   |   |   |   | 73,124    |   |   |   | 54,188              |        |   |   | (13,986 | ) |   |   | 18,936 |   |
| Exploration cost                   |   | c         |   |   | 217,110  |   |   |   | 793,081   |   |   |   | 1,177,817           |        |   |   | (575,971 | ) |   |   | (384,736 | ) |
| Gain on legal settlement           |   | d         |   |   | (530,789 | )      |   |   | (51,745   | )      |   |   | (148,739            | )           |   |   | (479,044 | ) |   |   | 96,994 |   |
| Gain on sale of exploration permit |   | d         |   |   | (159,502 | )      |   |   | -         |   |   |   | (376,937            | )           |   |   | (159,502 | ) |   |   | 376,937 |   |
| Investor relations                 |   |      |   |   | 12,048   |   |   |   | 37,051    |   |   |   | 24,726              |        |   |   | (25,003 | ) |   |   | 12,325 |   |
| Legal and regulatory               |   | e         |   |   | 183,497  |   |   |   | 144,844   |   |   |   | 140,727             |        |   |   | 38,653 |   |   |   | 4,117 |   |
| Office administration expenses     |   | f         |   |   | 236,626  |   |   |   | 384,804   |   |   |   | 366,836             |        |   |   | (148,178 | ) |   |   | 17,968 |   |
| Property investigation             |   | g         |   |   | 179,453  |   |   |   | 81,407    |   |   |   | 74,948              |        |   |   | 98,046 |   |   |   | 6,459 |   |
| Salaries and benefit               |   | h         |   |   | 116,227  |   |   |   | 388,887   |   |   |   | 618,926             |        |   |   | (272,660 | ) |   |   | (230,039 | ) |
| Share-based compensation           |   | i         |   |   | 100,693  |   |   |   | 80,248    |   |   |   | 297,588             |        |   |   | 20,445 |   |   |   | (217,340 | ) |
| Travel                             |   |      |   |   | 15,747   |   |   |   | 75,791    |   |   |   | 69,786              |        |   |   | (60,044 | ) |   |   | 6,005 |   |
|                               |   |      |   |   | 595,106  |   |   |   | 2,273,317 |   |   |   | 2,484,102           |        |   |   | (1,678,211 | ) |   |   | (210,785 | ) |
|                        |   |                    |    |   | Accumulative to |   |
|-----------------------------|--------|-------------------------|---------|--------|-----------------|--------|
|                        |   | Year Ended December 31, |    |   | December 31,    |   |
|                        |   | 2016                    |    |   | 2015            |   |   | 2014 |   |   | 2016 |   |
|                        |   | $                       |    |   |            | $      |   |   |   | $ |   |   |   | $ |   |   |
| Longnan property(ii)        |   |                    | 195,248 |   |            |   | 626,815 |   |   |   | 894,646 |   |   |   | 12,527,397 |   |
| Changkeng Property (i) (ii) |   |                    | -       |   |            |   | 122,652 |   |   |   | 244,784 |   |   |   | 8,285,703 |   |
| Gold Bull Mountain (ii)     |   |                    | 21,862  |   |            |   | 43,508 |   |   |   | 36,862 |   |   |   | 2,338,473 |   |
| Miscellaneous (iii)         |   |                    | -       |   |            |   | 106 |   |   |   | 1,525 |   |   |   | 6,099 |   |
|                        |   |                    | 217,110 |   |            |   | 793,081 |   |   |   | 1,177,817 |   |   |   | 23,157,672 |   |
|  | (i) | The Changkeng gold property was sold to Minco Silver on July 31, 2015. The amount presented in 2015 represents the amount incurred up to July 31, 2015. |
|--|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | During the year ended December 31, 2016, the Company did not conduct exploration activities on these properties, except for maintenance of the exploration permits. |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | (iii) | Miscellaneous exploration costs incurred for grass-root projects which are not significant to the Company. |
|--|-------|------------------------------------------------------------------------------------------------------------|

----

|                                                                  |   |   |      |   |   |   |       |   |   |   | Year to year changes |      |
|-----------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|------------|--------|--------|--------|----------------------|-----------|
|                                                                  |   | 2016   |      |   | 2015   |   |       | 2014   |   |   |                 | 2016-2015 |   |   |   | 2015-2014 |   |
|                                                                  |   | $      |      |   |   | $      |       |   |   | $      |                 |      |   | $ |   |   |   | $ |   |   |
| Share of gain (loss) from equity investment in Minco Silver  (i) |   |   | (408,225  | )      |   |   | 1,259,391  |   |   |   | (321,972             | )         |   |   | (1,667,616 | ) |   |   | 1,581,363 |   |
| Impairment  of equity investment in Minco Silver (ii)            |   |   | -         |   |   |   | -          |   |   |   | (4,205,816           | )         |   |   | - |   |   |   | 4,205,816 |   |
| Gain on investment at fair value (iii)                                |   |   | 9,399,970 |   |   |   | -          |   |   |   | -                    |      |   |   | 9,399,970 |   |   |   | - |   |
| Finance income                                                        |   |   | 62,394    |   |   |   | 64,819     |   |   |   | 17,570               |      |   |   | (2,425 | ) |   |   | 47,249 |   |
| Loss on partial disposal of investment in an associate                |   |   | -         |   |   |   | -          |   |   |   | (399,536             | )         |   |   | - |   |   |   | 399,536 |   |
| Gain on sale of Minco Resources (iv)                                  |   |   | -         |   |   |   | 15,060,170 |   |   |   | -                    |      |   |   | (15,060,170 | ) |   |   | 15,060,170 |   |
| Foreign exchange gain (loss) (v)                                      |   |   | (153,066  | )      |   |   | 209,493    |   |   |   | (16,977              | )         |   |   | (362,559 | ) |   |   | 226,470 |   |
| Impairment of property, plant, and equipment                          |   |   | -         |   |   |   | -          |   |   |   | (8,784               | )         |   |   | - |   |   |   | 8,784 |   |
| Dilution loss                                                         |   |   | (98,899   | )      |   |   | -          |   |   |   | (78,177              | )         |   |   | (98,899 | ) |   |   | 78,177 |   |
| Total other income (loss)                                             |   |   | 8,802,174 |   |   |   | 16,593,873 |   |   |   | (5,013,692           | )         |   |   | (7,791,699 | ) |   |   | 21,607,565 |   |

----

|                                                                                                                 | 2016 (unaudited)                            | 2015 (unaudited) |
|----------------------------------------------------------------------------------------------------------------------|---------------------------------------------|------------------|
|                                                                                                                 | Q4                                          | Q3               | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
|                                                                                                                 | $                                           | $                | $ | $ | $ | $ | $ | $ |
| Loss on investments                                                                                                  | 990,000                                     | -                | - | - | - | - | - | - |
| Operating expenses                                                                                                   |       199,526 | 266,312          |       (227,524) |       356,792 |       481,725 |       435,612 |       716,818 |       639,162 |
| Operating loss                                                                                                       | (1,189,526)                                 | (266,312)        |       227,524 | (356,792) | (481,725) | (435,612) | (716,818) | (639,162) |
| Foreign exchange gain (loss)                                                                                         | 100,473                                     | 72,739           | 15,411 | (341,689) | 179,569 | 47,068 | 5,299 | (22,443) |
| Recovery (impairment) of equity investment in Minco Silver                                                           | -                                           | -                | - | - | 2,205,638 | 966,009 | 295,027 | (3,466,674) |
| Gain (loss) on sale of Minco Resources                                                                               | -                                           | -                | - | - | (69,000) | 15,129,170 | - | - |
| Gain on investment at fair value                                                                                     | 9,399,970                                   | -                | - | - | - | - | - | - |
| Finance and other income                                                                                             | 14,308                                      | 15,465           | 16,060 | 16,561 | 26,778 | 19,790 | 10,092 | 8,159 |
| Gain (loss) for the period before gain and (loss) by using equity method to account for investment in Minco Silver : | 8,325,225                                   | (178,108)        | 258,995 | (681,920) | 1,861,260 | 15,726,425 | (406,400) | (4,120,120) |
| Dilution gain (loss)                                                                                                 | (4,421)                                     | (27,353)         | (57,940) | (9,185) | - | - | - | - |
| Share of income (loss) from equity investment in Minco Silver                                                        | 36,158                                      | (8,707)          | (46,060) | (389,616) | (26,176) | 326,989 | 674,879 | 283,699 |
| Net income (loss) before tax for the period                                                                          | 8,356,962                                   | (214,168)        | 154,995 | (1,080,721) | 1,835,084 | 16,053,414 | 268,479 | (3,836,421) |
| Net income(loss) for the period                                                                                      | 8,356,962                                   | (214,168)        | 154,995 | (1,080,721) | 1,835,084 | 16,053,414 | 268,479 | (3,836,421) |
| Other comprehensive income (loss)                                                                                    | (1,544,463)                                 | 149,744          | (445,845) | (923,376) | 234,410 | 15,440 | (557,969) | 1,888,973 |
| Comprehensive income (loss) for the period                                                                           | 6,812,499                                   | (64,424)         | (290,850) | (2,004,097) | 2,069,494 | 16,068,854 | (289,490) | (1,947,448) |
| Earnings (loss) per share - basic                                                                                    | 0.16                                        | (0.00)           | (0.00) | (0.02) | 0.00 | 0.32 | 0.01 | (0.08) |
| Earnings (loss) per share - diluted                                                                                  | 0.16                                        | (0.00)           | (0.00) | (0.02) | 0.00 | 0.32 | 0.01 | (0.08) |
| Weighted average number of shares outstanding - basic                                                                | 50,687,496                                  | 50,732,729       | 50,699,843 | 50,583,029 | 50,561,381 | 50,017,670 | 50,581,381 | 50,536,264 |
| Weighted average number of shares outstanding - diluted                                                              | 52,556,715                                  | 50,732,729       | 50,699,843 | 50,583,029 | 50,561,381 | 50,017,670 | 50,581,381 | 50,536,264 |

----

| Condensed Consolidated Interim Statement of Income (Loss) Impact | Three Months Ended September 30, 2015 |
|------------------------------------------------------------------|---------------------------------------|
|                                                             | As Reported                           | Adjustment | As Amended |
|                                                             | $                                     | $ | $ |
| Gain on sale of Minco Resources                                  | 18,536,407                            | (3,407,237) | 15,129,170 |
| (Impairment) recovery of equity investment in Minco Silver (1)   | (2,441,228)                           | 3,407,237 | 966,009 |
| Net gain for the period                                          | 16,053,414                            | - | 16,053,414 |
| Net gain attributable to the Shareholders of the Company         | 16,057,986                            | - | 16,057,986 |
| Loss per share: Basic and Diluted                                | 0.32                                  | - | 0.32 |
|                                                             |                                  |
| Condensed Consolidated Interim Statement of Income (Loss) Impact | Nine Months Ended September 30, 2015  |
|                                                             | As Reported$                          | Adjustment$ | As Amended$ |
|                                                             | $                                     | $ | $ |
| Gain on sale of Minco Resources                                  | 18,536,407                            | (3,407,237) | 15,129,170 |
| (Impairment)  recovery of equity investment in Minco Silver | (5,612,875)                           | 3,407,237 | (2,205,638) |
| Net gain for the period                                          | 12,485,472                            | - | 12,485,472 |
| Net gain attributable to the Shareholders of the Company         | 12,526,258                            | - | 12,526,258 |
| Loss per share: Basic and Diluted                                | 0.25                                  | - | 0.25 |

----

|                 |   | Year ended December 31, |       |
|----------------------|--------|-------------------------|------------|
|                 |   | 2016                    |       |   | 2015 |   |
|                 |   | $                       |       |   | $ |   |
| Operating activities |   |                    | (1,419,468 | ) |   |   | (1,751,341 | ) |
| Investing activities |   |                    | 530,000    |   |   |   | 4,822,688 |   |
| Financing activities |   |                    | 38,787     |   |   |   | 17,290 |   |

| · | The Company did not have operating subsidiaries in China and incurred less operating expenditures in 2016. |
|--------|------------------------------------------------------------------------------------------------------------|

| · | More cash was provided by the changes in working capital in 2016, which was offset by the use of $537,860 of cash in the acquisition of an investment. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Contractual obligations | Total   | Less than 1 year | 1  to 2 years |
|-------------------------|---------|------------------|--------------------|
|                    | $       | $                | $                  |
| Operating leases (1)    | 283,396 | 212,547          | 70,849             |
| Name                       | Present Position            |
|----------------------------|-----------------------------|
|                       |                        |
| Ken Z. Cai                 | President, CEO and Director |
| Robert Callander (1)(2)(3) | Director                    |
| Michael Doggett (1)(2)(3)  | Director                    |
| Malcolm Clay (1)(2)(3)     | Director                    |
| Larry Tsang                | Chief Financial Officer     |

----

| Name and principal position      | Year       | Salary ($) | Share-based awards ($) | Option-based awards($)(3) (4) | Annual non-equity incentive plan compensation($) | Pension value ($) | All Other Compensation ($) | Total Compensation ($) |
|----------------------------------|------------|------------|------------------------|-------------------------------|--------------------------------------------------|-------------------|----------------------------|------------------------|
| Ken Z. CaiChairman and CEO(1)(2) | 2016       | 118,542    | N/A               | -                             | -                                                | N/A          | 8,458(5)                   | 127,000                |
| Larry  TsangCFO(6)          | 2016  | 25,974     | N/A               | -                             | -                                                | N/A          | -                          | 25,974                 |

----

| Name                | Fees earned ($) | Share-based awards ($) | Option-based awards (1) ($) | Non-equity incentive plan compensation ($) | Pension value ($) | All other compensation ($) | Total ($) |
|---------------------|-----------------|------------------------|-----------------------------|--------------------------------------------|-------------------|----------------------------|-----------|
| Robert M. Callander | 17,500          | N/A                    | -                           | Nil                                        | N/A               | Nil                        | 17,500    |
| Malcolm Clay        | 19,500          | N/A                    | -                           | Nil                                        | N/A               | Nil                        | 19,500    |
| Michael Doggett     | 17,500          | N/A                    | -                           | Nil                                        | N/A               | 6,000                      | 23,500    |

| C. | BOARD PRACTICES |
|----|-----------------|

| Name of Director | Director Since    |
|------------------|-------------------|
| Ken Z. Cai       | February 29, 1996 |
| Robert Callander | August 23, 1996   |
| Michael Doggett  | July 16, 2007     |
| Malcolm Clay     | November 16, 2007 |

| (a) | the integrity of the Company’s financial statements; |
|-----|------------------------------------------------------------|

| (b) | the Company’s compliance with legal and regulatory requirements, as they relate to the Company’s financial statements; |
|-----|------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the qualifications, independence and performance of the Company’s auditor; |
|-----|----------------------------------------------------------------------------------|

| (d) | internal controls and disclosure controls; |
|-----|--------------------------------------------|

| (e) | the performance of the Company’s internal audit function; and |
|-----|---------------------------------------------------------------------|

| (f) | consideration and approval of certain related party transactions. |
|-----|-------------------------------------------------------------------|

| (a) | establish, review and recommend to the Board compensation and incentive plans and programs; and |
|-----|-------------------------------------------------------------------------------------------------|

| (b) | review and approve compensation and awards under compensation and incentive plans and programs for the CEO and senior officers |
|-----|--------------------------------------------------------------------------------------------------------------------------------|

----

| Name and Title                                           | CommonShares Held | Percentage of Common Shares Outstanding at December 31, 2016 | Stock Options Held                                        |
|----------------------------------------------------------|-------------------|--------------------------------------------------------------|-----------------------------------------------------------|
| Ken Cai, President, Chief Executive Officer and Director | 4,618,736(1)      | 9.10%                                                        | 2,340,000 (2)                                             |
| Robert Callander, Director                               | 30,277            | < 1%                                                      | 850,000 (3)                                               |
| Michael Doggett, Director                                | 12,000            | < 1%                                                      | 850,000 (4)                                               |
| Malcolm Clay, Director                                   | 30,000            | < 1%                                                      | 670,000 (5)                                               |
|  TOTAL                                              | 4,691,013         | 9.25%                                                        |         4,710,000 |
| (1) (2)  (3)  (4)  (5)  | 3,634,052 common shares are held by Pacific Canada Resources Inc., a private company, over which Dr. Cai exercises control or direction. Represents 530,000 options exercisable at $0.24 and which expire on February 6; 2022; 430,000 options exercisable at $0.24 and which expire on September 9, 2020; 430,000 options exercisable at $0.26 and which expire on January 17, 2019; 425,000 options exercisable at $0.46 and which expire on January 14, 2018; and 525,000 options exercisable at $0.45 and which expire on December 4, 2017 Represents 250,000 options exercisable at $0.24 and which expire on February 6, 2022; 150,000 options exercisable at $0.24 and which expire on September 9, 2020; 150,000 options exercisable at $0.26 and which expire on January 17, 2019; 150,000 options exercisable at $0.46 and which expire on January 14, 2018; and 150,000 options exercisable at $0.45 and which expire on December 4, 2017. Represents 350,000 options exercisable at $0.24 and which expire on February 6, 2022; 125,000 options exercisable at $0.24 and which expire on September 9, 2020; 125,000 options exercisable at $0.26 and which expire on January 17, 2019; 125,000 options exercisable at $0.46 and which expire on January 14, 2018; and 125,000 options exercisable at $0.45 and which expire on December 4, 2017. Represents 200,000 options exercisable at $0.24 and which expire on February 6, 2022; 125,000 options exercisable at $0.24 and which expire on September 9, 2020; 95,000 options exercisable at $0.26 and which expire on January 17, 2019; 125,000 options exercisable at $0.46 and which expire on January 14, 2018; and 125,000 options exercisable at $0.45 and which expire on December 4, 2017. |
|-----------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Title of Class | Identity of Holder                   | Amount Owned | Percent of Class |
|----------------|-------------------------------------------|--------------|------------------|
| Common shares  | Ken Z. Cai                                | 4,618,736    | 9.13%(1)         |
| Common shares  | IDG – Accel China Growth Fund II LP | 5,040,000    | 9.96%            |

| (1) | 3,634,052 common shares are held by Pacific Canada Resources Inc., a private company, over which Dr. Cai exercises control or direction. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------|

----

| - | $205,145 due from Minco Silver (December 31, 2015 – a payable of $ l77, 330). During the year ended December 31, 2016, Minco China, a subsidiary of Minco Silver, collected $544,164 on behalf of the Company from the partial settlement of the Retained Assets (refer to the MC Trust Arrangement discussed in the section “Business Overview”). Minco Silver also had $339,019 amount due from Minco Gold to account for the operating and shared expenses paid by Minco Gold on behalf of Minco Silver, net of the exploration expenses the Company paid on behalf of Minco Gold. |
|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| - | $18,527 due from MBM (December 31, 2015 - $12,387), in relation to shared office expenses recovery. |
|---|-----------------------------------------------------------------------------------------------------|

|                     |   | 2016   |    |   | 2015   |   |
|--------------------------|--------|--------|---------|--------|--------|--------|
|                     |   | $      |    |   | $      |   |
| Cash remuneration        |   |   | 312,016 |   |   |   | 333,729 |   |
| Share-based compensation |   |   | 80,702  |   |   |   | 67,405 |   |
| Total                    |   |   | 392,717 |   |   |   | 401,134 |   |
| ●  | Audited consolidated financial statements for the Company as at December 31, 2016 and 2015 and for the year ended December 31, 2016 (in Canadian dollars), with comparative figures for the years ended December 31, 2015 and 2014.             |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |                                                                                                                                                                                                                                            |
| ●       | Audited consolidated financial statements of Minco Silver Corporation as at December 31, 2016 and 2015 and for the year ended December 31, 2016 (in Canadian dollars), with comparative figures for the years ended December 31, 2015 and 2014. |

----

| YEAR ENDED DECEMBER 31,  | TSX(CDN$)HIGH | TSX(CDN$)LOW | NYSE MKT(US$)HIGH | NYSE MKT (US$)LOW |
|-------------------------------|---------------|--------------|-------------------|------------------------|
| 2016                          | 0.50          | 0.15         | 0.40              | 0.12                   |
| 2015                          | 0.39          | 0.14         | 0.32              | 0.12                   |
| 2014                          | 0.68          | 0.18         | 0.62              | 0.16                   |
| 2013                          | 0.50          | 0.14         | 0.52              | 0.12                   |
| 2012                          | 0.97          | 0.35         | 0.98              | 0.34                   |
| QUARTER ENDED      | TSX(CDN$)HIGH | TSX(CDN$)LOW     | NYSE MKT(US$)HIGH | NYSE MKT(US$)LOW |
|--------------------|---------------|------------------|-------------------|------------------|
| December 31, 2016  | 0.34          | 0.23             | 0.26              | 0.17             |
| September 30, 2016 | 0.50          | 0.33             | 0.38              | 0.25             |
| June 30, 2016      | 0.42          | 0.33             | 0.33              | 0.25             |
| March 31, 2016     | 0.46          |   0.15 | 0.40              | 0.12             |
| December 31, 2015  | 0.27          | 0.14             | 0.21              | 0.12             |
| September 30, 2015 | 0.30          | 0.21             | 0.25              | 0.17             |
| June 30, 2015      | 0.36          | 0.25             | 0.29              | 0.21             |
| March 31, 2015     | 0.39          |   0.25 | 0.32              | 0.21             |
| MONTH/YEAR     | TSX(CDN$)HIGH | TSX(CDN$)LOW | NYSE MKT(US$)HIGH | NYSE MKT(US$)LOW | OTCQX(US$)HIGH | OTCQX(US$)LOW |
|----------------|---------------|--------------|-------------------|------------------|----------------|---------------|
| February 2017  | 0.28          | 0.23         | -                 | -                | 0.19           | 0.17          |
| January 2017   | 0.30          | 0.23         | 0.23 (i)          | 0.19 (i)         | 0.18 (ii)      | 0.18 (ii)     |
| December 2016  | 0.31          | 0.22         | 0.18              | 0.17             |           |          |
| November 2016  | 0.34          | 0.24         | 0.26              | 0.17             |           |          |
| October 2016   | 0.35          | 0.29         | 0.28              | 0.21             |           |          |
| September 2016 | 0.38          | 0.33         | 0.30              | 0.25             |           |          |

| (i) | The Company’s shares were voluntarily delisted from NYSE MKT on January 27, 2017. These numbers represented the high and low from January 1, 2017 to Jan 27, 2017. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (ii) | The Company’s shares started to trade on OTCQX on January 31, 2017. These high and low represent the day high and low share price on January 31, 2017. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| 1. | On July 31, 2015 the Company entered into an Amended and Restated Declaration of Trust and Agency Agreement with Minco Silver, Minco China, Yuanling Minco and Huanihua Tiancheng. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2. | On May 22, 2015, the Company entered into the SPA with Minco Silver and Minco Silver’s wholly-owned subsidiary, Minco Resources.   Pursuant to the SPA, the Company sold all its shares of Minco Resources, which holds Minco China. Minco China owns certain subsidiaries including Yuanling Minco, Tibet Minco, Huanihua Tiancheng, legal ownership of Foshan Minco and a 51% interest in Mingzhong, which owns the Changkeng Property; and |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a) | the acquisition of our common shares by a person in the ordinary course of that person's business as a trader or dealer in securities; |
|-----|----------------------------------------------------------------------------------------------------------------------------------------|

| (b) | the acquisition of control of our Company in connection with the realization of security granted for a loan or other financial assistance and not for a purpose related to the provisions of the Investment Canada Act; and |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | the acquisition of control of our Company by reason of an amalgamation, merger, consolidation or corporate reorganization following which the ultimate direct or indirect control in fact of our Company, through ownership of our common shares, remains unchanged. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| § | at least 75% of its gross income is passive income which includes dividends, interest, royalties, rents (other than rents and royalties derived in the active conduct of a trade or business and not derived from a related person), certain gains from the sales of commodities, annuities and gains from assets that produce passive income, or |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| § | at least 50% of the value of its assets (based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income (the "asset test").  |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| § | the excess distribution or gain will be allocated ratably over the US Holder’s holding period for the common shares, |
|--------|---------------------------------------------------------------------------------------------------------------------------------|

| § | the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which we became a PFIC, will be treated as ordinary income, and |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| § | the amount allocated to each other year will be subject to the highest tax rate for the US Holder in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| · | Cash and cash equivalents– In order to manage credit and liquidity risk the Company places its cash with major financial institutions in Canada (subject to deposit insurance up to $100,000). As at December 31, 2016, total cash of $4,575,119 was placed with two institutions. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Short-term investment – The Company places its short-term investment with a major financial institution in Canada. As at December 31, 2016, total short-term investment was $3,352,062 (December 31, 2015 - $4,048,341). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Cash or investment denominated in US$ as at December 31, 2016 |   | USD    |      |   | C$ equivalent |   |      | Effect of a 10% Change in Exchange Rate – in $ |   |
|---------------------------------------------------------------|--------|--------|-----------|--------|---------------|--------|-----------|------------------------------------------------------|--------|
|                                                          |   |   |      |   |          |   |      |                                                 |   |
| Cash and cash equivalents                                     |   |   | 3,297,492 |   |          |   | 4,433,972 |                                                 |   |   | 443,397 |   |
|                                                          |   |   |      |   |          |   |      |                                                 |   |   |   |   |
|                                                          |   |   |      |   |          |   |      |                                                 |   |   |   |   |
| Investment at fair value, non-current                         |   |   | 400,000   |   |          |   | 537,860   |                                                 |   |   | 53,786 |   |
|                                                          |   |   |      |   |          |   |      |                                                 |   |   |   |   |
| (a) | Disclosure controls and procedures |
|-----|------------------------------------|
| (b) | Management’s annual report on internal controls over financial reporting |
|-----|--------------------------------------------------------------------------------|

----

|                   |   | 2016   |    |   | 2015   |   |
|------------------------|--------|--------|---------|--------|--------|--------|
|                   |   | $      |    |   | $      |   |
| Audit fees (1)         |   |   | 110,900 |   |   |   | 124,700 |   |
| Audit-related fees (2) |   |   | -       |   |   |   | 5,350 |   |
| Tax fees  (3)     |   |   | -       |   |   |   | - |   |
| All other fees (4)     |   |   | -       |   |   |   | - |   |
| Total                  |   |   | 110,900 |   |   |   | 130,050 |   |

| (1) | The aggregate fees billed for audit services. |
|-----|-----------------------------------------------|

| (2) | The aggregate fees billed for consultation, assurance and related services that are reasonably related to the performance of the audit or review of the Company's financial statements. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | The aggregate fees billed for tax compliance, corporate income tax returns, tax advice, tax compliance, and tax planning services. |
|-----|------------------------------------------------------------------------------------------------------------------------------------|

| (4) | The aggregate fees billed for professional services other than those listed in the other columns items. |
|-----|---------------------------------------------------------------------------------------------------------|

----

----

| DOCUMENT                                                                                                                                                                                                                                                                                                                                                                                                   | PAGE              |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------|
| Audited consolidated Financial Statements of the Company (Issuer) as at December 31, 2016 and 2015 and for the years ended December 31, 2016, 2015 and 2014, including the Report of Independent AuditorsAudited consolidated Financial Statements of Minco Silver as at December 31, 2016 and 2015 and for the years ended December 31, 2016, 2015 and 2014, including the Report of Independent Auditors | 44-76 77-109 |

----

| EXHIBITNUMBER | DATE                       | DESCRIPTION                                                                                                                                                                                         |
|---------------|----------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1.1*          | 20F – April 20, 2012 | Articles of Incorporation of Minco Gold Corporation                                                                                                                                                 |
| 1.2*          | 20F – April 20, 2012 | Notice of Articles of Minco Gold Corporation                                                                                                                                                        |
| 4.13*         | 20F – March 31, 2016 | Share Purchase Agreement dated May 22, 2015 between the Company, Minco Silver Corporation and Minco Investment Holdings HK Ltd.                                                                     |
| 4.14*         | 20F – March 31, 2016 | Amended and Restated Declaration of Trust and Agency Agreement dated July 31, 2015 between the Company, Minco Silver Corporation, Yuangling Minco Mining Co. Ltd. and Huaihua Tiancheng Mining Ltd. |
| 4.12*         | 20F – March 31, 2016 | Minco Gold Corporation Stock Option Plan                                                                                                                                                            |
| 12.1          | 20F – March 31, 2017 | Certification of the President Pursuant to Rule 13(a)-14(a) or ISD -14(a) under the Exchange Act                                                                                                    |
| 12.2          | 20F – March 31, 2017 | Certification of the Chief Financial Officer Pursuant  to Rule 13(a)-14(a) or ISD -14(a) under the Exchange Act                                                                                |
| 13.1          | 20F – March 31, 2017 | Certification of the President Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                               |
| 13.2          | 20F – March 31, 2017 | Certification of the Chief Financial Officer Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                 |
| 99.1          | 20F – March 31, 2017 | Glossary of Geological Terms                                                                                                                                                                        |

----

----

| Dr. Ken Cai       | Larry Tsang, CPA, CA    |
|-------------------|-------------------------|
| President and CEO | Chief Financial Officer |
|              |                    |

----

----

|                                           | Page                                                              |
|------------------------------------------------|-------------------------------------------------------------------|
| Consolidated Financial Statements              | 48-52                                                             |
|                                           | Consolidated Statements of Financial Position                     | 48 |
|                                           | Consolidated Statements of Income (Loss)                          | 49 |
|                                           | Consolidated Statements of Comprehensive Income (Loss)            | 50 |
|                                           | Consolidated Statements of Changes in Equity                      | 51 |
|                                           | Consolidated Statements of Cash Flows                             | 52 |
|                                           |                                                              |   |
| Notes to the Consolidated Financial Statements | 53-76                                                             |
| 1                                              | General information and significant transaction with Minco Silver | 53 |
| 2                                              | Basis of preparation                                              | 54 |
| 3                                              | Summary of significant accounting policies                        | 54 |
| 4                                              | Critical accounting estimates and judgments                       | 60 |
| 5                                              | Cash and cash equivalents                                         | 62 |
| 6                                              | Short-term investment                                             | 62 |
| 7                                              | Investments at fair value                                         | 63 |
| 8                                              | Investment in an associate                                        | 64 |
| 9                                              | Mineral interests                                                 | 66 |
| 10                                             | Gain on legal settlement                                          | 67 |
| 11                                             | Share capital                                                     | 68 |
| 12                                             | Income tax                                                        | 70 |
| 13                                             | Commitments                                                       | 71 |
| 14                                             | Related party transactions                                        | 72 |
| 15                                             | Financial instruments and fair values                             | 73 |
| 16                                             | Capital management                                                | 76 |
| 17                                             | Subsequent events                                                 | 76 |

----

|                                                     |   | December 31, |        |   | December 31, |   |
|----------------------------------------------------------|--------|--------------|-------------|--------|--------------|--------|
|                                                     |   | 2016         |        |   | 2015         |   |
| Assets                                                   |   |  $      |        |   |  $      |   |
| Current assets                                           |   |         |        |   |         |   |
| Cash and cash equivalents (note 5)                       |   |         | 4,575,119   |   |         |   | 5,593,669 |   |
| Short-term investment, (note 6)                          |   |         | 3,352,062   |   |         |   | 4,048,341 |   |
| Investments at fair value, current  (note 7)        |   |         | 11,770,000  |   |         |   | - |   |
| Receivables                                              |   |         | 169,380     |   |         |   | 11,122 |   |
| Due from related parties (note 14)                       |   |         | 223,672     |   |         |   | 12,387 |   |
| Prepaid expenses and deposits                            |   |         | 72,035      |   |         |   | 162,970 |   |
|                                                     |   |         | 20,162,268  |   |         |   | 9,828,489 |   |
| Non-current assets                                       |   |         |        |   |         |   |   |   |
| Long-term deposit                                        |   |         | 51,277      |   |         |   | 51,277 |   |
| Property, plant and equipment                            |   |         | 7,066       |   |         |   | 10,428 |   |
| Investments at fair value, non-current (note 7)          |   |         | 537,860     |   |         |   | - |   |
| Investment in an associate  (note 8)                |   |         | -           |   |         |   | 6,631,094 |   |
|                                                     |   |         | 20,758,471  |   |         |   | 16,521,288 |   |
| Liabilities                                              |   |         |        |   |         |   |   |   |
| Current liabilities                                      |   |         |        |   |         |   |   |   |
| Accounts payable and accrued liabilities                 |   |         | 211,427     |   |         |   | 389,522 |   |
| Due to related party (note 14)                           |   |         | -           |   |         |   | 177,330 |   |
|                                                     |   |         | 211,427     |   |         |   | 566,852 |   |
| Equity                                                   |   |         |        |   |         |   |   |   |
| Equity attributable to owners of the parent              |   |         |        |   |         |   |   |   |
| Share capital (note 11 (a))                              |   |         | 41,976,886  |   |         |   | 41,911,823 |   |
| Contributed surplus                                      |   |         | 9,322,102   |   |         |   | 9,247,685 |   |
| Accumulated other comprehensive income                   |   |         | -           |   |         |   | 2,763,940 |   |
| Deficits                                                 |   |         | (30,751,944 | )      |         |   | (37,969,012 | ) |
|                                                     |   |         | 20,547,044  |   |         |   | 15,954,436 |   |
| Total liabilities and equity                             |   |         | 20,758,471  |   |         |   | 16,521,288 |   |
| Commitments (note 13)Subsequent events (note 1, 9(b),17) |   |         |        |   |         |   |   |   |
|                                                     |   |         |        |   |         |   |   |   |
| Approved by the Board of Directors                       |   |         |        |   |         |   |   |   |

| (signed) Malcolm Clay Director |   | (signed) Robert CallanderDirector |
|--------------------------------|--------|-----------------------------------|

----

|                                                                  |   | 2016    |       |   | 2015    |   |       | 2014    |   |
|-----------------------------------------------------------------------|--------|---------|------------|--------|---------|--------|------------|---------|--------|
|                                                                  |   |  $ |       |   |  $ |   |       |  $ |   |
| Unrealized loss from investments at fair value (note 7)               |   |    | 990,000    |   |    |   | -          |    |   |   | - |   |
| Operating expenses                                                    |   |    |       |   |    |   |       |    |   |   |   |   |
| Accounting and audit                                                  |   |    | 99,959     |   |    |   | 152,777    |    |   |   | 105,423 |   |
| Amortization                                                          |   |    | 3,362      |   |    |   | 34,781     |    |   |   | 67,180 |   |
| Consulting                                                            |   |    | 61,537     |   |    |   | 78,267     |    |   |   | 11,633 |   |
| Directors' fees                                                       |   |    | 59,138     |   |    |   | 73,124     |    |   |   | 54,188 |   |
| Exploration costs (note 9)                                       |   |    | 217,110    |   |    |   | 793,081    |    |   |   | 1,177,817 |   |
| Gain on legal settlement (note 10)                               |   |    | (530,789   | )      |    |   | (51,745    | )       |   |   | (148,739 | ) |
| Gain on sale of exploration permit (note 9(b)(c))                |   |    | (159,502   | )      |    |   | -          |    |   |   | (376,937 | ) |
| Investor relations                                                    |   |    | 12,048     |   |    |   | 37,051     |    |   |   | 24,726 |   |
| Legal and regulatory                                                  |   |    | 183,497    |   |    |   | 144,844    |    |   |   | 140,727 |   |
| Office and miscellaneous                                              |   |    | 236,626    |   |    |   | 384,804    |    |   |   | 366,836 |   |
| Investment investigation                                              |   |    | 179,453    |   |    |   | 81,407     |    |   |   | 74,948 |   |
| Salaries and benefits                                                 |   |    | 116,227    |   |    |   | 388,887    |    |   |   | 618,926 |   |
| Share-based compensation (note 11(b))                                 |   |    | 100,693    |   |    |   | 80,248     |    |   |   | 297,588 |   |
| Travel and transportation                                             |   |    | 15,747     |   |    |   | 75,791     |    |   |   | 69,786 |   |
| Total operating expenses                                              |   |    | 595,106    |   |    |   | 2,273,317  |    |   |   | 2,484,102 |   |
| Operating loss                                                        |   |    | (1,585,106 | )      |    |   | (2,273,317 | )       |   |   | (2,484,102 | ) |
| Foreign exchange gain (loss)                                          |   |    | (153,066   | )      |    |   | 209,493    |    |   |   | (16,977 | ) |
| Gain on sale of Minco Resources (note 1)                              |   |    | -          |   |    |   | 15,060,170 |    |   |   | - |   |
| Gain on becoming an investment entity (note 7)                        |   |    | 9,399,970  |   |    |   | -          |    |   |   | - |   |
| Share of gain (loss) from an associate (note 8)                       |   |    | (408,225   | )      |    |   | 1,259,391  |    |   |   | (321,972 | ) |
| Dilution loss (note 8)                                                |   |    | (98,899    | )      |    |   | -          |    |   |   | (78,177 | ) |
| Impairment of investment in an associate (note 8)                     |   |    | -          |   |    |   | -          |    |   |   | (4,205,816 | ) |
| Loss on partial disposal of  investment in an associate (note 8) |   |    | -          |   |    |   | -          |    |   |   | (399,536 | ) |
| Impairment of property, plant and equipment                      |   |    | -          |   |    |   | -          |    |   |   | (8,784 | ) |
| Finance income                                                   |   |    | 62,394     |   |    |   | 64,819     |    |   |   | 17,570 |   |
| Net income (loss) for the year                                        |   |    | 7,217,068  |   |    |   | 14,320,556 |    |   |   | (7,497,794 | ) |
| Net income (loss) attributable to:                                    |   |    |       |   |    |   |       |    |   |   |   |   |
| Shareholders of the Company                                           |   |    | 7,217,068  |   |    |   | 14,361,342 |    |   |   | (7,354,162 | ) |
| Non-controlling interest                                              |   |    | -          |   |    |   | (40,786    | )       |   |   | (143,632 | ) |
|                                                                  |   |    | 7,217,068  |   |    |   | 14,320,556 |    |   |   | (7,497,794 | ) |
| Net Income (loss) per share:                                          |   |    |       |   |    |   |       |    |   |   |   |   |
|      basic                                   |   |    | 0.14       |   |    |   | 0.28       |    |   |   | (0.15 | ) |
|      diluted                                 |   |    | 0.14       |   |    |   | 0.28       |    |   |   | (0.15 | ) |
| Weighted average number of common shares outstanding:                 |   |    |       |   |    |   |       |    |   |   |   |   |
|      basic                                   |   |    | 50,687,496 |   |    |   | 50,566,749 |    |   |   | 50,488,078 |   |
|      diluted                                 |   |    | 52,510,830 |   |    |   | 50,566,749 |    |   |   | 50,488,078 |   |

----

|                                                                                                            |   | 2016   |       |   | 2015   |   |       | 2014   |   |
|-----------------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|
|                                                                                                            |   | $      |       |   | $      |   |       | $      |   |
| Net income (loss) for the year                                                                                  |   |   | 7,217,068  |   |   |   | 14,320,556 |   |   |   | (7,497,794 | ) |
| Other comprehensive income (loss), net of tax                                                                   |   |   |       |   |   |   |       |   |   |   |   |   |
| Items that may be reclassified subsequently to profit or loss:                                                  |   |   |       |   |   |   |       |   |   |   |   |   |
| -Reclassification of currency translation adjustments upon disposition of Minco Resources (note 1)              |   |   | -          |   |   |   | (479,324   | )      |   |   | - |   |
| -Reclassification of other comprehensive income on partial disposal of investment in an associate (note 8)      |   |   | -          |   |   |   | -          |   |   |   | (158,797 | ) |
| -Reclassification of other comprehensive income of an associate (note 8) on becoming investment entity (note 7) |   |   | (1,418,523 | )      |   |   | -          |   |   |   | - |   |
| -Share of other comprehensive income (loss) of an associate  (note 8)                                      |   |   | (1,345,417 | )      |   |   | 1,958,940  |   |   |   | 115,462 |   |
| -Exchange differences on translation from functional topresentation currency                                    |   |   | -          |   |   |   | 101,238    |   |   |   | 131,551 |   |
|                                                                                                            |   |   |       |   |   |   |       |   |   |   |   |   |
| Total comprehensive income (loss) for the year                                                                  |   |   | 4,453,128  |   |   |   | 15,901,410 |   |   |   | (7,409,578 | ) |
|                                                                                                            |   |   |       |   |   |   |       |   |   |   |   |   |
| Comprehensive income (loss) attributable to:                                                                    |   |   |       |   |   |   |       |   |   |   |   |   |
| Shareholders of the Company                                                                                     |   |   | 4,453,128  |   |   |   | 15,904,973 |   |   |   | (7,273,894 | ) |
| Non-controlling interest                                                                                        |   |   | -          |   |   |   | (3,563     | )      |   |   | (135,684 | ) |
|                                                                                                            |   |   | 4,453,128  |   |   |   | 15,901,410 |   |   |   | (7,409,578 | ) |

----

|                                                                                                         |   |             |       |   | Attributable to equity owner of the Company |   |       |                |   |   |                                   |   |
|--------------------------------------------------------------------------------------------------------------|--------|------------------|------------|--------|---------------------------------------------|--------|------------|---------------------|--------|--------|----------------------------------------|--------|
|                                                                                                         |   | Number of shares |       |   | Share capital                               |   |       | Contributed surplus |   |   | Accumulated other comprehensive income |   |   | Deficits |   |   | Subtotal |   |   | Non-controlling interest |   |   | Total equity |   |
|                                                                                                         |   |             |       |   | $                                           |   |       | $                   |   |   | $                                      |   |   | $ |   |   | $ |   |   | $ |   |   | $ |   |
| Balance – January 1, 2014                                                                              |   |             | 50,348,215 |   |                                        |   | 41,758,037 |                |   |   | 8,933,012                              |   |   |   | 1,102,818 |   |   |   | (44,976,192 | ) |   |   | 6,817,675 |   |   |   | 5,124,196 |   |   |   | 11,941,871 |   |
| Net loss for the year                                                                                        |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   | - |   |   |   | (7,354,162 | ) |   |   | (7,354,162 | ) |   |   | (143,632 | ) |   |   | (7,497,794 | ) |
| Other comprehensive income                                                                                   |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   | 80,268 |   |   |   | - |   |   |   | 80,268 |   |   |   | 7,948 |   |   |   | 88,216 |   |
| Proceeds on issuance of shares from exercise of options                                                      |   |             | 166,666    |   |                                        |   | 124,720    |                |   |   | (51,387                                | )      |   |   | - |   |   |   | - |   |   |   | 73,333 |   |   |   | - |   |   |   | 73,333 |   |
| Share-based compensation                                                                                     |   |             | -          |   |                                        |   | -          |                |   |   | 297,588                                |   |   |   | - |   |   |   | - |   |   |   | 297,588 |   |   |   | - |   |   |   | 297,588 |   |
|                                                                                                         |   |             | 50,514,881 |   |                                        |   | 41,882,757 |                |   |   | 9,179,213                              |   |   |   | 1,183,086 |   |   |   | (52,330,354 | ) |   |   | (85,298 | ) |   |   | 4,988,512 |   |   |   | 4,903,214 |   |
| Balance - January 1, 2015                                                                                    |   |             | 50,514,881 |   |                                        |   | 41,882,757 |                |   |   | 9,179,213                              |   |   |   | 1,183,086 |   |   |   | (52,330,354 | ) |   |   | (85,298 | ) |   |   | 4,988,512 |   |   |   | 4,903,214 |   |
| Net income (loss) for the year                                                                               |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   | - |   |   |   | 14,361,342 |   |   |   | 14,361,342 |   |   |   | (40,786 | ) |   |   | 14,320,556 |   |
| Other comprehensive income                                                                                   |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   | 1,580,854 |   |   |   | - |   |   |   | 1,580,854 |   |   |   | 37,223 |   |   |   | 1,618,077 |   |
| Elimination of non-controlling interest related to sale of Minco Resources                                   |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (4,984,949 | ) |   |   | (4,984,949 | ) |
| Proceeds on issuance of shares from exercise of options                                                      |   |             | 66,500     |   |                                        |   | 29,066     |                |   |   | (11,776                                | )      |   |   | - |   |   |   | - |   |   |   | 17,290 |   |   |   | - |   |   |   | 17,290 |   |
| Share-based compensation                                                                                     |   |             | -          |   |                                        |   | -          |                |   |   | 80,248                                 |   |   |   | - |   |   |   | - |   |   |   | 80,248 |   |   |   | - |   |   |   | 80,248 |   |
| Balance - December 31, 2015                                                                                  |   |             | 50,581,381 |   |                                        |   | 41,911,823 |                |   |   | 9,247,685                              |   |   |   | 2,763,940 |   |   |   | (37,969,012 | ) |   |   | 15,954,436 |   |   |   | - |   |   |   | 15,954,436 |   |
|                                                                                                         |   |             |       |   |                                        |   |       |                |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance - January 1, 2016                                                                                    |   |             | 50,581,381 |   |                                        |   | 41,911,823 |                |   |   | 9,247,685                              |   |   |   | 2,763,940 |   |   |   | (37,969,012 | ) |   |   | 15,954,436 |   |   |   | - |   |   |   | 15,954,436 |   |
|                                                                                                         |   |             |       |   |                                        |   |       |                |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income  for the year                                                                                |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   |   |   |   |   | 7,217,068 |   |   |   | 7,217,068 |   |   |   | - |   |   |   | 7,217,068 |   |
| Other comprehensive loss (note 8)                                                                            |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   | (1,345,417 | ) |   |   | - |   |   |   | (1,345,417 | ) |   |   | - |   |   |   | (1,345,417 | ) |
| Reclassification of other comprehensive income of an associate upon changes to an investment entity (note 7) |   |             | -          |   |                                        |   | -          |                |   |   | -                                      |   |   |   | (1,418,523 | ) |   |   | - |   |   |   | (1,418,523 | ) |   |   | - |   |   |   | (1,418,523 | ) |
| Proceeds on issuance of shares from exercise of options                                                      |   |             | 152,000    |   |                                        |   | 65,063     |                |   |   | (26,276                                | )      |   |   | - |   |   |   | - |   |   |   | 38,787 |   |   |   | - |   |   |   | 38,787 |   |
| Share-based compensation                                                                                     |   |             | -          |   |                                        |   | -          |                |   |   | 100,693                                |   |   |   | - |   |   |   | - |   |   |   | 100,693 |   |   |   | - |   |   |   | 100,693 |   |
| Balance - December 31, 2016                                                                                  |   |             | 50,733,381 |   |                                        |   | 41,976,886 |                |   |   | 9,322,102                              |   |   |   | - |   |   |   | (30,751,944 | ) |   |   | 20,547,044 |   |   |   | - |   |   |   | 20,547,044 |   |
| The accompanying notes are an integral parts of these consolidated financial statements                      |   |

----

|                                                                                                    |   | 2016   |       |   | 2015   |   |        | 2014   |   |
|---------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|-------------|--------|--------|
| Cash flow provided by (used in)                                                                         |   | $      |       |   | $      |   |        | $      |   |
| Operating activities                                                                                    |   |   |       |   |   |   |        |   |   |
| Net income (loss) for the year                                                                          |   |   | 7,217,068  |   |   |   | 14,320,556  |   |   |   | (7,497,794 | ) |
| Items not affecting cash:                                                                               |   |   |       |   |   |   |        |   |   |   |   |   |
|         Amortization                                            |   |   | 3,362      |   |   |   | 34,363      |   |   |   | 67,180 |   |
|         Share of loss (gain) from an associate (note 8)         |   |   | 408,225    |   |   |   | (1,259,391  | )      |   |   | 321,972 |   |
|         Dilution loss                                           |   |   | 98,899     |   |   |   | -           |   |   |   | 78,177 |   |
| Loss on partial disposal of investment in an associate                                                  |   |   | -          |   |   |   | -           |   |   |   | 399,536 |   |
| Impairment of investment in an associate                                                                |   |   | -          |   |   |   | -           |   |   |   | 4,205,816 |   |
| Impairment on property, plant and equipment                                                             |   |   | -          |   |   |   | -           |   |   |   | 8,784 |   |
|         Foreign exchange loss (gain)                            |   |   | 148,484    |   |   |   | (227,257    | )      |   |   | 17,603 |   |
|         Gain on sale of Minco Resource                          |   |   | -          |   |   |   | (15,111,348 | )      |   |   | - |   |
|         Gain from legal settlement  (note 11)              |   |   | (530,789   | )      |   |   | (51,745     | )      |   |   | (148,739 | ) |
|         Gain on sale of exploration permits (note 9(b))         |   |   | (159,502   | )      |   |   | -           |   |   |   | (376,937 | ) |
|         Unrealized loss from investments at fair value (note 7) |   |   | 990,000    |   |   |   | -           |   |   |   | - |   |
|         Gain on becoming an investment entity (note 7)          |   |   | (9,399,970 | )      |   |   | -           |   |   |   | - |   |
|         Share-based compensation (note 11 (b))                  |   |   | 100,693    |   |   |   | 80,248      |   |   |   | 297,588 |   |
| Purchase of short-term investment (note 6)                                                              |   |   | (3,332,062 | )      |   |   |        |   |   |   |   |   |
| Redemption of short-term investment (note 6)                                                            |   |   | 3,498,341  |   |   |   |        |   |   |   |   |   |
| Purchase of investments at fair value (Note 7)                                                          |   |   | (537,860   | )      |   |   | -           |   |   |   | - |   |
| Changes in items of working capital:                                                                    |   |   |       |   |   |   |        |   |   |   |   |   |
|         Receivables                                             |   |   | (158,258   | )      |   |   | 10,454      |   |   |   | (82,144 | ) |
|         Due from related parties                                |   |   | 321,064    |   |   |   | 501,491     |   |   |   | 41,368 |   |
|         Prepaid expenses and deposits                           |   |   | 90,935     |   |   |   | (140,315    | )      |   |   | (73,151 | ) |
|         Accounts payable and accrued liabilities                |   |   | (178,098   | )      |   |   | 91,603      |   |   |   | 19,141 |   |
| Net cash used in operating activities                                                                   |   |   | (1,419,468 | )      |   |   | (1,751,341  | )      |   |   | (2,721,600 | ) |
| Investing activities                                                                                    |   |   |       |   |   |   |        |   |   |   |   |   |
| Net cash outflow from sale of Minco Resources and its subsidiaries                                      |   |   | -          |   |   |   | (1,354,041  | )      |   |   | - |   |
| Proceeds from legal settlement (note 11)                                                                |   |   | -          |   |   |   | 94,472      |   |   |   | 720,095 |   |
| Proceeds from partial disposal of investment in an associate (note 8)                                   |   |   | -          |   |   |   | -           |   |   |   | 1,500,000 |   |
| Proceeds from sales of exploration permits (note 9(b))                                                  |   |   | -          |   |   |   | -           |   |   |   | 376,937 |   |
| Purchase of or proceeds from sale of property, plant and equipment                                      |   |   | -          |   |   |   | 13,693      |   |   |   | (13,772 | ) |
| Purchase of short-term investments (note 6)                                                             |   |   | (20,000    | )      |   |   |        |   |   |   |   |   |
| Redemption of short-term investments                                                                    |   |   | 550,000    |   |   |   | 6,068,564   |   |   |   | - |   |
| Net cash generated from investing activities                                                            |   |   | 530,000    |   |   |   | 4,822,688   |   |   |   | 2,583,260 |   |
| Financing activities                                                                                    |   |   |       |   |   |   |        |   |   |   |   |   |
| Advance from non-controlling interest shareholders                                                      |   |   | -          |   |   |   | -           |   |   |   | 258,471 |   |
| Proceeds from stock option exercises                                                                    |   |   | 38,787     |   |   |   | 17,290      |   |   |   | 73,333 |   |
| Net cash generated from financing activities                                                            |   |   | 38,787     |   |   |   | 17,290      |   |   |   | 331,804 |   |
| Effect of exchange rate changes on cash and cash equivalents                                            |   |   | (167,869   | )      |   |   | 387,994     |   |   |   | 125,765 |   |
| (Decrease) increase in cash and cash equivalents                                                        |   |   | (1,018,550 | )      |   |   | 3,476,631   |   |   |   | 319,229 |   |
| Cash and cash equivalents- Beginning of year                                                            |   |   | 5,593,669  |   |   |   | 2,117,038   |   |   |   | 1,797,809 |   |
| Cash and cash equivalents - End of year                                                                 |   |   | 4,575,119  |   |   |   | 5,593,669   |   |   |   | 2,117,038 |   |
| Cash paid for income tax                                                                                |   |   | -          |   |   |   | -           |   |   |   | - |   |

----

| 1. | General information |
|----|---------------------|

----

| 1. | General information (continued) |
|----|---------------------------------|

| 3. | Summary of significant accounting policies |
|----|--------------------------------------------|

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

|   | Name              | Principal activities (ownership interest)                     | Country of incorporation |
|--------|-------------------|---------------------------------------------------------------|--------------------------|
|   | Minco China       | Exploring and evaluating mineral properties (100%)            | China                    |
|   | Yuanling Minco    | Exploring and evaluating mineral properties (100%)            | China                    |
|   | Tibet Minco       | Exploring and evaluating mineral properties (100%)            | China                    |
|   | Huaihua Tiancheng | Exploring and evaluating mineral properties (100%)            | China                    |
|   | Minco Resources   | Holding company (100%)                                        | China                    |
|   | Mingzhong         | Exploring and evaluating mineral properties   (51%) | China                    |

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

| · | Assets and liabilities – at the closing rate at the date of the statement of financial position |
|--------|-------------------------------------------------------------------------------------------------------|

| · | Income and expenses – at the average rate of the period (as this is considered a reasonable approximation of actual rates) |
|--------|----------------------------------------------------------------------------------------------------------------------------------|

----

----

| (i) | significant financial difficulty of the obligor; |
|-----|--------------------------------------------------|

| (ii) | delinquencies in interest and principal payments; and |
|------|-------------------------------------------------------|

| (iii) | it becomes probable that the borrower will enter bankruptcy or other financial reorganization. |
|-------|------------------------------------------------------------------------------------------------|

----

----

| 4. | Critical accounting estimates and judgments |
|----|---------------------------------------------|

----

| · | obtains funds from one or more investors for the purpose of providing those investor(s) with investment management services; |
|--------|------------------------------------------------------------------------------------------------------------------------------|

| · | commits to its investors that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both; and |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| · | measures and evaluates the performance of substantially all of its investments on a fair value basis. |
|--------|-------------------------------------------------------------------------------------------------------|

| · | it has more than one investment (On November 11, 2016, the Company had one investment in Minco Silver and was in the process of acquiring its investment in EI Olivar Imperial SAC, which was completed before the year ended December 31, 2016); |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | it has more than one investor ; |
|--------|---------------------------------|

| · | it has investors that are not related parties of the entity; and |
|--------|------------------------------------------------------------------|

| · | it has ownership interests in the form of equity. |
|--------|---------------------------------------------------|

----

----

|                                                        |   | 2016   |       |   | 2015   |   |
|-------------------------------------------------------------|--------|--------|------------|--------|--------|--------|
|                                                        |   | $      |       |   | $      |   |
| Current:                                                    |   |   |       |   |   |   |
|     Investment in Minco Silver (Note 8) |   |   | 11,770,000 |   |   |   | - |   |
| Non-current:                                                |   |   |       |   |   |   |   |   |
|    Investment in EI Olivar Imperial SAC      |   |   | 537,860    |   |   |   | - |   |
| Total                                                       |   |   | 12,307,860 |   |   |   | - |   |

----

| Year ended December 31, 2016                                                                                                          |   | $      |      |
|---------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|
| Investment in Minco Silver :                                                                                                          |   |   |      |
| The difference of the carrying value ($4,778,553) and the fair value ($12,760,000) of investment in Minco Silver on November 11, 2016 |   |   | 7,981,447 |   |
| Reclassification from other comprehensive income upon changes to an investment entity (on November 11, 2016) to income statement      |   |   | 1,418,523 |   |
| Gain on deemed disposal at November 11, 2016                                                                                          |   |   | 9,399,970 |   |
| Unrealized loss from change in fair value on investment in Minco Silver from November 11, 2016 to December 31, 2016                   |   |   | (990,000  | ) |
| Unrealized gain (loss)  from investment in El Olivar from December 22, 2016 to December 31, 2016                                 |   |   | -         |   |
| Unrealized loss on investments at fair value                                                                                          |   |   | (990,000  | ) |

| 8. | Investment in an associate |
|----|----------------------------|

----

| 8. | Investment in an associate (continued) |
|----|----------------------------------------|

|                                                            |   | Period from January 1 to November 11, |        |   |   |   |       |   |   |
|-----------------------------------------------------------------|--------|---------------------------------------|-------------|--------|--------|--------|------------|--------|--------|
|                                                            |   | 2016                                  |        |   | 2015   |   |       | 2014   |   |
|                                                            |   | $                                     |        |   | $      |   |       | $      |   |
| Beginning of period                                             |   |                                  | 6,631,094   |   |   |   | 6,820,000  |   |   |   | 13,368,836 |   |
| Dilution loss                                                   |   |                                  | (98,899     | )      |   |   | -          |   |   |   | (78,177 | ) |
| Share of Minco Silver’s income (loss)                     |   |                                  | (408,225    | )      |   |   | 1,259,391  |   |   |   | (321,972 | ) |
| Share of Minco Silver’s other comprehensive income (loss) |   |                                  | (1,345,417  | )      |   |   | 1,958,940  |   |   |   | 115,462 |   |
| Partial disposition                                             |   |                                  |        |   |   |   | -          |   |   |   | (2,058,333 | ) |
| Unrealized gain on disposition of Minco Resources               |   |                                  | -           |   |   |   | (3,407,237 | )      |   |   | - |   |
| Impairment                                                      |   |                                  | -           |   |   |   | -          |   |   |   | (4,205,816 | ) |
| Ending of period                                                |   |                                  | 4,778,553(i | )      |   |   | 6,631,094  |   |   |   | 6,820,000 |   |
|                          |   | December 31, 2015 |        |
|-------------------------------|--------|-------------------|-------------|
|                          |   | $                 |        |
| Cash and cash equivalents     |   |              | 26,202,564  |   |
| Other current assets          |   |              | 33,039,404  |   |
| Mineral interests             |   |              | 63,676,055  |   |
| Property, plant and equipment |   |              | 434,999     |   |
| Current liabilities           |   |              | 638,549     |   |
| Shareholders' equity          |   |              | 122,714,472 |   |

----

| 8. | Investment in an associate (continued) |
|----|----------------------------------------|

| Years ended December 31,                 |   | 2016 (i) |        |   | 2015   |   |       | 2014   |   |
|------------------------------------------|--------|----------|-------------|--------|--------|--------|------------|--------|--------|
|                                     |   | $        |        |   | $      |   |       | $      |   |
| Administrative expenses                  |   |     | 2,576,760   |   |   |   | 2,805,616  |   |   |   | 3,376,141 |   |
| Interest income                          |   |     | 521,021     |   |   |   | 911,213    |   |   |   | 980,945 |   |
| Net income (loss) for the year           |   |     | (2,407,668  | )      |   |   | 6,680,947  |   |   |   | (1,665,516 | ) |
| Other comprehensive income (loss)        |   |     | (9,277,783  | )      |   |   | 10,851,532 |   |   |   | 470,514 |   |
| Comprehensive income (loss) for the year |   |     | (11,685,451 | )      |   |   | 17,532,479 |   |   |   | (1,195,002 | ) |

| iv) | Yangshan: including four exploration permits located in the northeast extension of the Yangshan gold belt and its adjacent area; |
|-----|----------------------------------------------------------------------------------------------------------------------------------|

| v) | Yejiaba: including four exploration permits adjacent to the Guojiagou exploration permit; and |
|----|-----------------------------------------------------------------------------------------------|

| vi) | Xicheng East: including one exploration permit to the east extension of the Xicheng Pb-Zn mineralization belt. |
|-----|----------------------------------------------------------------------------------------------------------------|

----

| c) | Hunan - Gold Bull Mountain |
|----|----------------------------|

|                             |   | December 31, |    |   | December 31, |   |    | December 31, |   |   | December 31, |   |
|----------------------------------|--------|--------------|---------|--------|--------------|--------|---------|--------------|--------|--------|--------------|--------|
|                             |   | 2016         |    |   | 2015         |   |    | 2014         |   |   | 2016         |   |
|                             |   | $            |    |   | $            |   |    | $            |   |   | $            |   |
| Gansu - Longnan                  |   |         | 195,248 |   |         |   | 626,815 |         |   |   | 894,646      |   |   |   | 12,527,397 |   |
| Guangdong- Changkeng             |   |         | -       |   |         |   | 122,652 |         |   |   | 244,784      |   |   |   | 8,285,703 |   |
| Hunan  - Gold Bull Mountain |   |         | 21,862  |   |         |   | 43,508  |         |   |   | 36,862       |   |   |   | 2,338,473 |   |
| Guangdong - Sihui                |   |         | -       |   |         |   | 106     |         |   |   | 1,525        |   |   |   | 6,099 |   |
|  Total                      |   |         | 217,110 |   |         |   | 793,081 |         |   |   | 1,177,817    |   |   |   | 23,157,672 |   |

----

| 11. | Share capital |
|-----|---------------|

| a. | Common shares |
|----|---------------|

| b. | Stock options |
|----|---------------|

----

| 11. | Share capital (continued) |
|-----|---------------------------|

|                       |   | Number outstanding |       |   | Weighted average exercise price |   |
|----------------------------|--------|--------------------|------------|--------|---------------------------------|--------|
|                       |   |               |       |   | $                               |   |
| January 1, 2015            |   |               | 6,460,501  |   |                            |   | 0.79 |   |
|                       |   |               |       |   |                            |   |   |   |
| Granted                    |   |               | 1,190,000  |   |                            |   | 0.24 |   |
| Forfeited                  |   |               | (66,500    | )      |                            |   | 0.26 |   |
| Cancelled                  |   |               | (927,500   | )      |                            |   | 0.55 |   |
| Expired                    |   |               | (66,667    | )      |                            |   | 0.93 |   |
|                       |   |               |       |   |                            |   |   |   |
| Balance, December 31, 2015 |   |               | 6,589,834  |   |                            |   | 0.72 |   |
|                       |   |               |       |   |                            |   |   |   |
| Exercised                  |   |               | (152,000   | )      |                            |   | 0.26 |   |
| Forfeited                  |   |               | (72,000    | )      |                            |   | 0.47 |   |
| Expired                    |   |               | (1,122,500 | )      |                            |   | 2.17 |   |
|                       |   |               |       |   |                            |   |   |   |
| Balance, December 31, 2016 |   |               | 5,243,334  |   |                            |   | 0.43 |   |
| Options outstanding    |              |   | Options exercisable |   |
|------------------------|-------------------|--------|---------------------|--------|
|                   |              |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Range ofexerciseprices |              |   | Numberoutstanding   |   |   | Weightedaverageremainingcontractuallife (years) |   |   | Weightedaverageexerciseprice |   |   | Numberexercisable |   |   | Weightedaverageexerciseprice |   |
| $                      |              |   |                |   |   |  |   |   | $ |   |   |   |   |   | $ |   |
|                   | 0.18 – 0.24 |   |                |   | 1,003,334 |   |   |   | 3.70 |   |   |   | 0.24 |   |   |   | 656,665 |   |   |   | 0.24 |   |
|                   | 0.25 – 0.42 |   |                |   | 895,000 |   |   |   | 2.05 |   |   |   | 0.26 |   |   |   | 895,000 |   |   |   | 0.26 |   |
|                   | 0.43 – 0.54 |   |                |   | 2,100,000 |   |   |   | 0.98 |   |   |   | 0.46 |   |   |   | 2,100,000 |   |   |   | 0.46 |   |
|                   | 0.55 – 0.67 |   |                |   | 1,245,000 |   |   |   | 0.24 |   |   |   | 0.67 |   |   |   | 1,245,000 |   |   |   | 0.67 |   |
|                   |              |   |                |   | 5,243,334 |   |   |   | 1.51 |   |   |   | 0.43 |   |   |   | 4,896,665 |   |   |   | 0.44 |   |

----

| 11. | Share capital (continued) |
|-----|---------------------------|

|                     | 2016   | 2015          | 2014         |
|--------------------------|--------|---------------|--------------|
|                     |   |          |         |
| Risk-free interest rate  | -      | 0.78% - 1.68% | 1.27% -1.68% |
| Dividend yield           | -      | 0%            | 0%           |
| Volatility               | -      | 85% - 87%     | 87% - 89%    |
| Forfeiture rate          | -      | 23%           | 23%          |
| Estimated expected lives | -      | 5 years       | 5 years      |

| 12. | Income tax |
|-----|------------|

|                                                     | 2016        | 2015        | 2014        |
|----------------------------------------------------------|-------------|-------------|-------------|
|                                                     | $           | $           | $           |
|                                                     |        |        |        |
| Net income (loss)                                        | 7,217,068   | 14,320,556  | (7,497,794) |
|                                                     |        |        |        |
|                                                     | 26%         | 26%         | 26%         |
|                                                     |        |        |        |
| Income tax recovery at statutory rates                   | 1,876,438   | 3,723,345   | (1,949,427) |
| Non-taxable (deductible) expenses                        | 26,375      | 19,159      | (431,590)   |
| Difference in tax rates                                  | (671,958)   | 1,093,732   | 20,291      |
| Difference in gain on disposition of Minco Resources     | -           | (6,662,076) | -           |
| Reduction of tax attributes from sale of Minco Resources | -           | 6,668,881   | -           |
| Expiry of non-capital loss carry forward                 | -           | 300,755     | 279,602     |
| Deferred income tax asset not recognized                 | (1,245,922) | (5,252,629) | 1,664,315   |
| Other                                                    | 15,067      | 108,833     | 416,809     |
|                                                     |        |        |        |
| Provision for tax expenses                               | -           | -           | -           |

----

|                                                    |   | 2016   |       |   | 2015   |   |
|---------------------------------------------------------|--------|--------|------------|--------|--------|--------|
|                                                    |   | $      |       |   | $      |   |
|                                                    |   |   |       |   |   |   |
| Deferred income tax assets (liabilities) not recognized |   |   |       |   |   |   |
| Non-capital loss                                        |   |   | 3,718,815  |   |   |   | 3,536,062 |   |
| Resource expenditures                                   |   |   | 680,236    |   |   |   | 701,784 |   |
| Capital assets                                          |   |   | 34,127     |   |   |   | 50,671 |   |
| Investment in Minco Silver                              |   |   | (1,043,545 | )      |   |   | (375,488 | ) |
| Capital loss                                            |   |   | 1,066,999  |   |   |   | 1,070,899 |   |
|                                                    |   |   |       |   |   |   |   |   |
|                                                    |   |   | 4,456,631  |   |   |   | 4,983,929 |   |
|   | $          |
|--------|------------|
|   |       |
| 2026   | 1,442,234  |
| 2028   | 1,582,716  |
| 2029   | 1,270,045  |
| 2030   | 1,285,615  |
| 2031   | 1,933,078  |
| 2032   | 2,131,656  |
| 2033   | 1,535,838  |
| 2034   | 1,324,803  |
| 2035   | 1,201,864  |
| 2036   | 595,284    |
|   | 14,303,133 |
|   |   | $      |    |
|--------|--------|--------|---------|
|   |   |   |    |
| 2017   |   |   | 212,547 |   |
| 2018   |   |   | 70,849  |   |
|   |   |   | 283,396 |   |

----

| - | $205,145 due from Minco Silver (December 31, 2015 – a payable of $177,330) which is a combined result of the following: |
|---|-------------------------------------------------------------------------------------------------------------------------------|

| - | $18,527 due from MBM (December 31, 2015 -  $12,387), in relation to shared office expenses |
|---|-------------------------------------------------------------------------------------------------|

----

| 14. | Related party transactions (continued) |
|-----|----------------------------------------|

|                                                                   |   | 2016   |    |   | 2015   |   |    | 2014   |   |
|------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
|                                                                   |   | $      |    |   | $      |   |    | $      |   |
| Cash remuneration                                                      |   |   | 313,016 |   |   |   | 333,729 |   |   |   | 270,693 |   |
| Share-based compensation                                               |   |   | 80,702  |   |   |   | 67,405  |   |   |   | 215,202 |   |
| Total                                                                  |   |   | 393,717 |   |   |   | 401,134 |   |   |   | 485,895 |   |
| The above transactions are conducted in the normal course of business. |   |

| 15. | Financial instruments and fair value |
|-----|--------------------------------------|

| December 31,                                                      |   | 2016    |       |   | 2015    |   |
|-------------------------------------------------------------------|--------|---------|------------|--------|---------|--------|
|                                                              |   |  $ |       |   |  $ |   |
| Fair value through profit and loss                                |   |    |       |   |    |   |
| Investments at fair value, current and non-current  (note 7) |   |    | 12,307,860 |   |    |   | - |   |
| Loans and receivables                                             |   |    |       |   |    |   |   |   |
| Cash                                                              |   |    | 4,575,119  |   |    |   | 5,593,669 |   |
| Short-term investment                                             |   |    | 3,352,062  |   |    |   | 4,048,341 |   |
| Receivables                                                       |   |    | 169,380    |   |    |   | 11,122 |   |
| Due from related parties                                          |   |    | 223,672    |   |    |   | 12,387 |   |
| Other Financial Liabilities                                       |   |    |       |   |    |   |   |   |
| Accounts payables                                                 |   |    | 211,424    |   |    |   | 405,550 |   |
| Due to related party                                              |   |    | -          |   |    |   | 177,330 |   |

----

| 15. | Financial instruments and fair value (continued) |
|-----|--------------------------------------------------|

|                                   |   | Level 1 |       |   | Level 2 |   |   | Level 3 |   |
|----------------------------------------|--------|---------|------------|--------|---------|--------|--------|---------|--------|
|                                   |   | $       |       |   | $       |   |   | $       |   |
| Investments at fair value, current     |   |    | 11,700,000 |   |    |   | -      |    |   |   | - |   |
| Investments at fair value, non-current |   |    | -          |   |    |   |   |    |   |   | 537,860 | (i) |

| o | Cash and cash equivalents– In order to manage credit and liquidity risk the Company places its cash with major financial institutions in two major banks in Canada (subject to deposit insurance up to $100,000). As at December 31, 2016, total cash of $4,575,119 was placed with two institutions. |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 15. | Financial instruments and fair value (continued) |
|-----|--------------------------------------------------|

| o | Short-term investment – The Company places its short-term investment with a major financial institution in a major bank in Canada. As at December 31, 2016, short-term investments totalled $3,352,062 (December 31, 2015 - $4,048,341). |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 16. | Capital management |
|-----|--------------------|

| 17. | Subsequent events |
|-----|-------------------|

| · | February 17, 2017 – Investment of $750,000 in Hudson Resources Inc., a Canadian public company, through a private placement of 2,142,285 units at a price of $0.35 per unit. Each unit comprised one common share and one-half of a transferable share purchase warrant. Each warrant is exercisable into one additional common share until February 16, 2020, at $0.50 per share. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | March 2, 2017 - Investment of $84,000 in Barkerville Gold Mines Ltd., a Canadian public company, through the purchase of 200,000 common shares at $0.42 per share in the open market.   |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| Dr. Ken Cai       | Larry Tsang, CPA, CA    |
|-------------------|-------------------------|
| President and CEO | Chief Financial Officer |
|              |                    |

----

----

|                                           | Page                                                             |
|------------------------------------------------|------------------------------------------------------------------|
| Consolidated Financial Statements              | 81 - 86                                                          |
|                                           |                                                             |   |
|                                           | Consolidated Statements of Financial Position                    | 81 |
|                                           | Consolidated Statements of Operations and Net Income (Loss)      | 82 |
|                                           | Consolidated Statements of Comprehensive Income (Loss)           | 83 |
|                                           | Consolidated Statements of Changes in Shareholders’ Equity | 84 |
|                                           | Consolidated Statements of Cash Flows                            | 86 |
|                                           |                                                             |   |
| Notes to the Consolidated Financial Statements | 87 - 109                                                         |
|                                           |                                                             |   |
| 1                                              | General information                                              | 87 |
| 2                                              | Basis of preparation                                             | 87 |
| 3                                              | Summary of significant accounting policies                       | 87 |
| 4                                              | Critical accounting estimates and judgments                      | 94 |
| 5                                              | Acquisition of Minco Resources                                   | 94 |
| 6                                              | Cash and cash equivalents                                        | 95 |
| 7                                              | Short-term investments                                           | 96 |
| 8                                              | Mineral interests                                                | 96 |
| 9                                              | Non-controlling interest                                         | 98 |
| 10                                             | Investments                                                      | 99 |
| 11                                             | Share capital                                                    | 99 |
| 12                                             | Income taxes                                                     | 103 |
| 13                                             | Related party transactions                                       | 104 |
| 14                                             | Geographical information                                         | 106 |
| 15                                             | Commitments                                                      |   |
| 16                                             | Financial instruments and fair value                             | 107 |
| 17                                             | Capital management                                               | 108 |
| 18                                             | Subsequent events                                                | 109 |

----

|                                        |   | December 31, |        |   | December 31, |   |
|---------------------------------------------|--------|--------------|-------------|--------|--------------|--------|
|                                        |   | 2016         |        |   | 2015         |   |
| Assets                                      |   | $            |        |   |  $      |   |
|                                        |   |         |        |   |         |   |
| Current assets                              |   |         |        |   |         |   |
| Cash and cash equivalents (note 6)          |   |         | 20,195,199  |   |         |   | 26,202,564 |   |
| Short-term investments (note 7)             |   |         | 31,410,880  |   |         |   | 32,143,068 |   |
| Receivables                                 |   |         | 541,293     |   |         |   | 517,359 |   |
| Due from related parties (note 13)          |   |         | 163,167     |   |         |   | 177,330 |   |
| Prepaid expenses and deposits               |   |         | 202,213     |   |         |   | 201,647 |   |
|                                        |   |         | 52,512,752  |   |         |   | 59,241,968 |   |
|                                        |   |         |        |   |         |   |   |   |
| Mineral interests (note 8)                  |   |         | 59,141,579  |   |         |   | 63,676,055 |   |
| Property, plant and equipment               |   |         | 295,612     |   |         |   | 434,999 |   |
|                                        |   |         | 111,949,943 |   |         |   | 123,353,022 |   |
| Liabilities                                 |   |         |        |   |         |   |   |   |
|                                        |   |         |        |   |         |   |   |   |
| Current liabilities                         |   |         |        |   |         |   |   |   |
| Accounts payable and accrued liabilities    |   |         | 424,635     |   |         |   | 638,550 |   |
| Due to related parties (note 13)            |   |         | 205,145     |   |         |   | - |   |
|                                        |   |         | 629,780     |   |         |   | 638,550 |   |
| Equity                                      |   |         |        |   |         |   |   |   |
| Equity attributable to owners of the parent |   |         |        |   |         |   |   |   |
| Share capital (note 11(a))                  |   |         | 107,216,932 |   |         |   | 106,630,256 |   |
| Contributed surplus                         |   |         | 22,682,099  |   |         |   | 22,977,633 |   |
| Accumulated other comprehensive income      |   |         | 6,795,087   |   |         |   | 14,813,721 |   |
| Deficit                                     |   |         | (36,692,296 | )      |         |   | (34,468,043 | ) |
|                                        |   |         | 100,001,822 |   |         |   | 109,953,567 |   |
| Non-controlling interest (note 9)           |   |         | 11,318,341  |   |         |   | 12,760,905 |   |
| Total equity                                |   |         | 111,320,163 |   |         |   | 122,714,472 |   |
| Total liabilities and equity                |   |         | 111,949,943 |   |         |   | 123,353,022 |   |

| (signed) Maria Tang Director |   | (signed) George Lian Director |
|------------------------------|--------|-------------------------------|

----

|                                                                           |   | 2016   |       |   | 2015   |   |       | 2014   |   |
|--------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|
|                                                                           |   | $      |       |   | $      |   |       | $      |   |
| Administrative expenses                                                        |   |   |       |   |   |   |       |   |   |
|   Audit, legal and regulatory                                        |   |   | 271,656    |   |   |   | 284,789    |   |   |   | 246,236 |   |
|   Amortization                                                       |   |   | 97,692     |   |   |   | 106,674    |   |   |   | 123,266 |   |
|   Consulting                                                         |   |   | 105,665    |   |   |   | 161,074    |   |   |   | 226,390 |   |
|   Directors' fees                                                    |   |   | 99,500     |   |   |   | 116,000    |   |   |   | 127,250 |   |
|   Field office expenses                                              |   |   | 442,022    |   |   |   | 860,980    |   |   |   | 686,418 |   |
|   Investor relations                                                 |   |   | 65,919     |   |   |   | 16,297     |   |   |   | 15,350 |   |
|   Office administration expenses                                     |   |   | 345,643    |   |   |   | 237,310    |   |   |   | 205,984 |   |
|   Property investigation                                             |   |   | -          |   |   |   | 31,331     |   |   |   | 169,852 |   |
|   Rent                                                               |   |   | 417,590    |   |   |   | 376,544    |   |   |   | 356,736 |   |
|   Salaries and benefits                                              |   |   | 519,353    |   |   |   | 440,095    |   |   |   | 431,477 |   |
|   Share-based compensation (note 11(b))                              |   |   | 143,312    |   |   |   | 146,742    |   |   |   | 750,226 |   |
|   Travel and transportation                                          |   |   | 68,408     |   |   |   | 27,780     |   |   |   | 36,956 |   |
|                                                                           |   |   | 2,576,760  |   |   |   | 2,805,616  |   |   |   | 3,376,141 |   |
|                                                                           |   |   |       |   |   |   |       |   |   |   |   |   |
| Income (loss) before finance and other income (expenses)                       |   |   | (2,576,760 | )      |   |   | (2,805,616 | )      |   |   | (3,376,141 | ) |
|                                                                           |   |   |       |   |   |   |       |   |   |   |   |   |
| Finance and other income (expenses)                                            |   |   |       |   |   |   |       |   |   |   |   |   |
|   Foreign exchange gain (loss)                                       |   |   | (340,446   | )      |   |   | 4,173,854  |   |   |   | 1,039,265 |   |
|   Gain on disposal of investment (note 10)                           |   |   | -          |   |   |   | 4,792,888  |   |   |   | - |   |
|   Interest income                                                    |   |   | 521,021    |   |   |   | 911,213    |   |   |   | 980,945 |   |
|   Other expenses (note 13(a))                                        |   |   | (11,483    | )      |   |   | (391,392   | )      |   |   | (309,585 | ) |
|                                                                           |   |   | 169,092    |   |   |   | 9,486,563  |   |   |   | 1,710,625 |   |
| Net income (loss) for the year                                                 |   |   | (2,407,668 | )      |   |   | 6,680,947  |   |   |   | (1,665,516 | ) |
|                                                                           |   |   |       |   |   |   |       |   |   |   |   |   |
| Net income (loss) attributable to:                                             |   |   |       |   |   |   |       |   |   |   |   |   |
| Shareholders of the Company                                                    |   |   | (2,224,253 | )      |   |   | 6,827,186  |   |   |   | (1,665,516 | ) |
| Non-controlling interest                                                       |   |   | (183,415   | )      |   |   | (146,239   | )      |   |   | - |   |
|                                                                           |   |   | (2,407,668 | )      |   |   | 6,680,947  |   |   |   | (1,665,516 | ) |
| Income (loss) per share – basic and diluted                              |   |   | (0.04      | )      |   |   | 0.11       |   |   |   | (0.03 | ) |
| Weighted average number of common shares outstanding – basic and diluted |   |   | 59,977,212 |   |   |   | 59,631,418 |   |   |   | 59,590,457 |   |

----

|                                                                                                                     |   | 2016   |        |   | 2015   |   |       | 2014   |   |
|--------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|------------|--------|--------|
|                                                                                                                     |   | $      |        |   | $      |   |       | $      |   |
| Net income (loss) for the year                                                                                           |   |   | (2,407,668  | )      |   |   | 6,680,947  |   |   |   | (1,665,516 | ) |
|                                                                                                                     |   |   |        |   |   |   |       |   |   |   |   |   |
| Other comprehensive income (loss)                                                                                        |   |   |        |   |   |   |       |   |   |   |   |   |
| Items that may be reclassified subsequently to profit or loss:Unrealized gain (loss) on investment, net of tax (note 10) |   |   | -           |   |   |   | 7,125,020  |   |   |   | (3,024,176 | ) |
| Realized gain reclassified to net income (loss) on disposal of investment, net of tax (note 10)                          |   |   | -           |   |   |   | (4,100,844 | )      |   |   | - |   |
| Exchange differences on translation from functional to presentation currency                                             |   |   | (9,277,783  | )      |   |   | 7,827,356  |   |   |   | 3,494,690 |   |
| Other comprehensive income (loss) for the year                                                                           |   |   | (9,277,783  | )      |   |   | 10,851,532 |   |   |   | 470,514 |   |
|                                                                                                                     |   |   |        |   |   |   |       |   |   |   |   |   |
| Comprehensive income (loss) for the year                                                                                 |   |   | (11,685,451 | )      |   |   | 17,532,479 |   |   |   | (1,195,002 | ) |
|                                                                                                                     |   |   |        |   |   |   |       |   |   |   |   |   |
| Comprehensive income (loss) attributable to:                                                                             |   |   |        |   |   |   |       |   |   |   |   |   |
| Shareholders of the Company                                                                                              |   |   | (10,242,887 | )      |   |   | 17,446,647 |   |   |   | (1,195,002 | ) |
| Non-controlling interest                                                                                                 |   |   | (1,442,564  | )      |   |   | 85,832     |   |   |   | - |   |
|                                                                                                                     |   |   | (11,685,451 | )      |   |   | 17,532,479 |   |   |   | (1,195,002 | ) |

----

|                                                    |   |             |       |   | Changes in Shareholders’ Equity |   |        |                |   |   |                                   |   |   |    |       |   |     |   |
|---------------------------------------------------------|--------|------------------|------------|--------|---------------------------------------|--------|-------------|---------------------|--------|--------|----------------------------------------|--------|--------|---------|------------|--------|----------|--------|
|                                                    |   | Number of Shares |       |   | Share capital                         |   |        | Contributed surplus |   |   | Accumulated other comprehensive income |   |   | Deficit |       |   | Subtotal |   |   | Non-controlling interest |   |   | Total equity |   |
|                                                    |   |             |       |   | $                                     |   |        | $                   |   |   | $                                      |   |   | $       |       |   | $        |   |   | $ |   |   | $ |   |
|                                                    |   |             |       |   |                                  |   |        |                |   |   |                                   |   |   |    |       |   |     |   |   |   |   |   |   |   |
| Balance - January 1, 2014                               |   |             | 59,328,085 |   |                                  |   | 106,140,836 |                |   |   | 21,950,949                             |   |   |    | 3,723,746  |   |     |   | (39,629,713 | ) |   |   | 92,185,818 |   |   |   | - |   |   |   | 92,185,818 |   |
|                                                    |   |             |       |   |                                  |   |        |                |   |   |                                   |   |   |    |       |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss for the year                                   |   |             | -          |   |                                  |   | -           |                |   |   | -                                      |   |   |    | -          |   |     |   | (1,665,516 | ) |   |   | (1,665,516 | ) |   |   | - |   |   |   | (1,665,516 | ) |
| Other comprehensive income                              |   |             | -          |   |                                  |   | -           |                |   |   | -                                      |   |   |    | 470,514    |   |     |   | - |   |   |   | 470,514 |   |   |   | - |   |   |   | 470,514 |   |
| Share-based compensation                                |   |             | -          |   |                                  |   | -           |                |   |   | 1,135,564                              |   |   |    | -          |   |     |   | - |   |   |   | 1,135,564 |   |   |   | - |   |   |   | 1,135,564 |   |
| Issuance of shares for restricted share units           |   |             | 280,000    |   |                                  |   | 459,200     |                |   |   | (459,200                               | )      |   |    | -          |   |     |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Proceeds on issuance of shares from exercise of options |   |             | 23,333     |   |                                  |   | 30,220      |                |   |   | (11,554                                | )      |   |    | -          |   |     |   | - |   |   |   | 18,666 |   |   |   | - |   |   |   | 18,666 |   |
| Balance – December 31, 2014                       |   |             | 59,631,418 |   |                                  |   | 106,630,256 |                |   |   | 22,615,759                             |   |   |    | 4,194,260  |   |     |   | (41,295,229 | ) |   |   | 92,145,046 |   |   |   | - |   |   |   | 92,145,046 |   |
|                                                    |   |             |       |   |                                  |   |        |                |   |   |                                   |   |   |    |       |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance - January 1, 2015                               |   |             | 59,631,418 |   |                                  |   | 106,630,256 |                |   |   | 22,615,759                             |   |   |    | 4,194,260  |   |     |   | (41,295,229 | ) |   |   | 92,145,046 |   |   |   | - |   |   |   | 92,145,046 |   |
|                                                    |   |             |       |   |                                  |   |        |                |   |   |                                   |   |   |    |       |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-controlling interest in acquisition                 |   |             | -          |   |                                  |   | -           |                |   |   | -                                      |   |   |    | -          |   |     |   | - |   |   |   | - |   |   |   | 12,675,073 |   |   |   | 12,675,073 |   |
| Net loss for the year                                   |   |             | -          |   |                                  |   | -           |                |   |   | -                                      |   |   |    | -          |   |     |   | 6,827,186 |   |   |   | 6,827,186 |   |   |   | (146,239 | ) |   |   | 6,680,947 |   |
| Other comprehensive income                              |   |             | -          |   |                                  |   | -           |                |   |   | -                                      |   |   |    | 10,619,461 |   |     |   | - |   |   |   | 10,619,461 |   |   |   | 232,071 |   |   |   | 10,851,532 |   |
| Share-based compensation                                |   |             | -          |   |                                  |   | -           |                |   |   | 361,874                                |   |   |    | -          |   |     |   | - |   |   |   | 361,874 |   |   |   | - |   |   |   | 361,874 |   |
| Balance – December 31, 2015                       |   |             | 59,631,418 |   |                                  |   | 106,630,256 |                |   |   | 22,977,633                             |   |   |    | 14,813,721 |   |     |   | (34,468,043 | ) |   |   | 109,953,567 |   |   |   | 12,760,905 |   |   |   | 122,714,472 |   |
|                                                    |   |             |       |   |                                  |   |        |                |   |   |                                   |   |   |    |       |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                                                    |   | Changes in Shareholders’ Equity |       |   |          |   |        |                |   |   |                                   |   |
|-----------------------------------------------------------------------------------------|--------|---------------------------------------|------------|--------|---------------|--------|-------------|---------------------|--------|--------|----------------------------------------|--------|
|                                                                                    |   | Number of Shares                      |       |   | Share capital |   |        | Contributed surplus |   |   | Accumulated other comprehensive income |   |   | Deficit |   |   | Subtotal |   |   | Non-controlling interest |   |   | Total equity |   |
|                                                                                    |   |                                  |       |   |          |   |        |                |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance - January 1, 2016                                                               |   |                                  | 59,631,418 |   |          |   | 106,630,256 |                |   |   | 22,977,633                             |   |   |   | 14,813,721 |   |   |   | (34,468,043 | ) |   |   | 109,953,567 |   |   |   | 12,760,905 |   |   |   | 122,714,472 |   |
|                                                                                    |   |                                  |       |   |          |   |        |                |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss for the year                                                                   |   |                                  | -          |   |          |   | -           |                |   |   | -                                      |   |   |   | - |   |   |   | (2,224,253 | ) |   |   | (2,224,253 | ) |   |   | (183,415 | ) |   |   | (2,407,668 | ) |
| Other comprehensive income                                                              |   |                                  | -          |   |          |   | -           |                |   |   | -                                      |   |   |   | (8,018,634 | ) |   |   | - |   |   |   | (8,018,634 | ) |   |   | (1,259,149 | ) |   |   | (9,277,783 | ) |
| Share-based compensation                                                                |   |                                  | -          |   |          |   | -           |                |   |   | 256,928                                |   |   |   | - |   |   |   | - |   |   |   | 256,928 |   |   |   | - |   |   |   | 256,928 |   |
| Issuance of shares – options exercised                                            |   |                                  | 614,995    |   |          |   | 586,676     |                |   |   | (223,245                               | )      |   |   | - |   |   |   | - |   |   |   | 363,431 |   |   |   | - |   |   |   | 363,431 |   |
| Reversal of share-based compensation relating to performance share unit (note  11) |   |                                  | -          |   |          |   | -           |                |   |   | (329,217                               | )      |   |   | - |   |   |   | - |   |   |   | (329,217 | ) |   |   | - |   |   |   | (329,217 | ) |
| Balance – December 31, 2016                                                       |   |                                  | 60,246,413 |   |          |   | 107,216,932 |                |   |   | 22,682,099                             |   |   |   | 6,795,087 |   |   |   | (36,692,296 | ) |   |   | 100,001,822 |   |   |   | 11,318,341 |   |   |   | 111,320,163 |   |

----

|                                                                                     |   | 2016   |       |   | 2015   |   |        | 2014   |   |
|------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|-------------|--------|--------|
|                                                                                     |   |   | $          |   |   |   | $           |   |   |   | $  |   |
| Operating activities                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| Net income(loss) for the year                                                            |   |   | (2,407,668 | )      |   |   | 6,680,947   |   |   |   | (1,665,516 | ) |
| Adjustments for:                                                                         |   |   |       |   |   |   |        |   |   |   |   |   |
|         Amortization                             |   |   | 97,692     |   |   |   | 106,674     |   |   |   | 123,266 |   |
|         Foreign exchange loss (gain)             |   |   | 340,446    |   |   |   | (4,173,854  | )      |   |   | (1,038,828 | ) |
|         Share-based compensation (note 11(b))    |   |   | 143,313    |   |   |   | 146,742     |   |   |   | 750,226 |   |
|         Gain on disposal of investment           |   |   | -          |   |   |   | (4,792,888  | )      |   |   | - |   |
|                                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| Changes in items of working capital:                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
|         Receivables                              |   |   | (66,070    | )      |   |   | (28,020     | )      |   |   | (57,907 | ) |
|         Prepaid expenses and deposits            |   |   | (9,804     | )      |   |   | 115,728     |   |   |   | 257,126 |   |
|         Accounts payable and accrued liabilities |   |   | (125,491   | )      |   |   | 4,695       |   |   |   | (115,171 | ) |
|         Due from/to related parties (note 13)    |   |   | 196,390    |   |   |   | (428,425    | )      |   |   | (16,819 | ) |
| Net cash used in operating activities                                                    |   |   | (1,831,192 | )      |   |   | (2,368,401  | )      |   |   | (1,763,623 | ) |
|                                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| Financing activities                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| Proceeds from stock option exercises                                                     |   |   | 363,431    |   |   |   | -           |   |   |   | 18,666 |   |
| Net cash generated from financing activities                                             |   |   | 363,431    |   |   |   | -           |   |   |   | 18,666 |   |
|                                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| Investing activities                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| Development costs                                                                        |   |   | (1,787,942 | )      |   |   | (1,811,422  | )      |   |   | (1,550,105 | ) |
| Cash inflows as result of acquisition of Changkeng Gold Project (note 5)                 |   |   | -          |   |   |   | 1,347,693   |   |   |   | - |   |
| Proceeds from (purchase of) investments (note 10)                                        |   |   | -          |   |   |   | 18,682,204  |   |   |   | (13,889,316 | ) |
| Property, plant and equipment                                                            |   |   | -          |   |   |   | 7,164       |   |   |   | (29,828 | ) |
| Purchase of short-term investments                                                       |   |   | (7,740,766 | )      |   |   | (16,941,170 | )      |   |   | (14,430,923 | ) |
| Redemption of short-term investments                                                     |   |   | 5,889,960  |   |   |   | 11,288,990  |   |   |   | 18,683,677 |   |
| Net cash generated from (used in) investing activities                                   |   |   | (3,638,748 | )      |   |   | 12,573,459  |   |   |   | (11,216,495 | ) |
|                                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| Effect of exchange rates on cash and cash equivalents                                    |   |   | (900,856   | )      |   |   | 4,058,962   |   |   |   | 1,319,482 |   |
|                                                                                     |   |   |       |   |   |   |        |   |   |   |   |   |
| (Decrease) increase in cash and cash equivalents                                         |   |   | (6,007,365 | )      |   |   | 14,264,020  |   |   |   | (11,641,970 | ) |
| Cash and cash equivalents - Beginning of year                                            |   |   | 26,202,564 |   |   |   | 11,938,544  |   |   |   | 23,580,514 |   |
| Cash and cash equivalents - End of year                                             |   |   | 20,195,199 |   |   |   | 26,202,564  |   |   |   | 11,938,544 |   |

----

| 1. | General information |
|----|---------------------|

| 2. | Basis of preparation |
|----|----------------------|

| 3. | Summary of significant accounting policies |
|----|--------------------------------------------|

| Name                                                                                                                                                                                                         | Principal activities (ownership interest)                     | Country of Incorporation                              |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------|-------------------------------------------------------|
| Minco Yinyuan                                                                                                                                                                                                | Treasury company (100%)                                       |         China |   |
| Minco HK                                                                                                                                                                                                     | Holding company (100%)                                        | China                                                 |   |
| Changfu Minco                                                                                                                                                                                                | Exploring, evaluating and developing mineral properties (90%) | China                                                 |   |
| Zhongjia                                                                                                                                                                                                     | Service company (90%)                                         | China                                                 |   |
| Minco Resources (i)                                                                                                                                                                                          | Holding company (100%)                                        | China                                                 |   |
| Minco China (i)                                                                                                                                                                                              | Exploring and evaluating mineral properties (100%)            | China                                                 |   |
| Yuanling Minco(i)                                                                                                                                                                                            | Exploring and evaluating mineral properties (100%)            | China                                                 |   |
| Tibet Minco (i)                                                                                                                                                                                              | Exploring and evaluating mineral properties (100%)            | China                                                 |   |
| Huaihua (i)                                                                                                                                                                                                  | Exploring and evaluating mineral properties (100%)            | China                                                 |   |
| Minco International Resources (i)                                                                                                                                                                            | Investment and service company (100%)                         | China                                                 |   |
| Mingzhong (i)                                                                                                                                                                                                | Exploring and evaluating mineral properties (51%)             | China                                                 |   |
|                                                                                                                                                                                                         |                                                          |                                                  |   |
| (i) The Company acquired these subsidiaries on July 31, 2015. The Company’s operating results and cash flow in 2015 only include the results of these subsidiaries from August 1 to December 31, 2015. |                                                          |

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

| · | Assets and liabilities – at the closing rate at the date of the statement of financial position |
|--------|-------------------------------------------------------------------------------------------------------|

| · | Income and expenses – at the average rate of the period (as this is considered a reasonable approximation of actual rates) |
|--------|----------------------------------------------------------------------------------------------------------------------------------|

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

| (iv) | significant financial difficulty of the obligor; |
|------|--------------------------------------------------|

| (v) | delinquencies in interest and principal payments; and |
|-----|-------------------------------------------------------|

| (vi) | it becomes probable that the borrower will enter bankruptcy or other financial reorganization. |
|------|------------------------------------------------------------------------------------------------|

| Computer, Office Equipment and Furniture | 5 years              |
|------------------------------------------|----------------------|
| Mining Equipment                         | 5 years              |
| Site Motor Vehicles                      | 10 years             |
| Leasehold Improvements                   | remaining lease term |

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

| (i) | Stock Options |
|-----|---------------|

| (ii) | Restricted Share Units (“RSU”) |
|------|--------------------------------------------|

| (iii) | Performance Share Units (“PSU”) |
|-------|---------------------------------------------|

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

----

| 3. | Summary of significant accounting policies (continued) |
|----|--------------------------------------------------------|

| 4. | Critical accounting estimates and judgments |
|----|---------------------------------------------|

| 5. | Acquisition of Minco Resources |
|----|--------------------------------|

----

| 5. | Acquisition of Minco Resources (continued) |
|----|--------------------------------------------|

|                                                                   |   |   |        |
|------------------------------------------------------------------------|--------|--------|-------------|
| Consideration                                                          |   | $      |        |
|   Short-term investment                                      |   |   | 10,016,397  |   |
|   Settlement of loan payable from Minco Gold to Minco Silver |   |   | 3,700,000   |   |
|   Transaction costs                                          |   |   | 69,627      |   |
|   Total consideration                                        |   |   | 13,786,024  |   |
|                                                                   |   |   |        |   |
| Net assets acquired                                                    |   |   | $           |   |
|   Cash                                                       |   |   | 1,249,209   |   |
|   Receivables                                                |   |   | 91,901      |   |
|   Prepaid expenses and deposits                              |   |   | 126,035     |   |
|   Property, plan, and equipment                              |   |   | 76,555      |   |
|   Mineral interest                                           |   |   | 25,312,695  |   |
|   Accounts payable and accrued liabilities                   |   |   | (195,595    | ) |
|   Due to related parties                                     |   |   | (199,703    | ) |
|   Minority interest share of the assets acquired             |   |   | (12,675,073 | ) |
|                                                                   |   |   | 13,786,024  |   |

| 6. | Cash and cash equivalents |
|----|---------------------------|

|          |   | As at December 31, 2016 |       |   | As at December 31, 2015 |   |
|---------------|--------|-------------------------|------------|--------|-------------------------|--------|
|          |   | $                       |       |   | $                       |   |
| Cash          |   |                    | 2,206,082  |   |                    |   | 22,886,760 |   |
| Term deposits |   |                    | 17,989,117 |   |                    |   | 3,315,804 |   |
|          |   |                    | 20,195,199 |   |                    |   | 26,202,564 |   |

----

| 7. | Short-term investments |
|----|------------------------|

| 8. | Mineral interests |
|----|-------------------|

|                     | $          |
|--------------------------|------------|
| Fuwan Silver Project (a) | 35,287,777 |
| Changkeng Project (c)    | 23,853,802 |
| Total mineral interests  | 59,141,579 |

| (a) | Fuwan Silver Project |
|-----|----------------------|

|                                           |   | 2016   |       |   | 2015   |   |
|------------------------------------------------|--------|--------|------------|--------|--------|--------|
|                                           |   | $      |       |   | $      |   |
| Opening Balance – January 1              |   |   | 37,565,101 |   |   |   | 31,621,827 |   |
| Consulting fees                                |   |   | 390,802    |   |   |   | 657,446 |   |
| Salaries and benefits                          |   |   | 337,137    |   |   |   | 147,761 |   |
| Feasibility study                              |   |   | -          |   |   |   | 110,813 |   |
| Share-based compensation (note 11(b))          |   |   | (215,602   | )      |   |   | 215,132 |   |
| Mine design costs                              |   |   | 8,882      |   |   |   | 18,826 |   |
| Mining license application                     |   |   | 365,316    |   |   |   | 181,992 |   |
| Environment impact assessment                  |   |   | 68,612     |   |   |   | 57,277 |   |
| Travel                                         |   |   | 43,215     |   |   |   | 65,664 |   |
| Other                                          |   |   | 293,320    |   |   |   | 396,045 |   |
| Effect of change in the exchange rate with RMB |   |   | (3,569,006 | )      |   |   | 4,092,318 |   |
| Ending Balance – December 31             |   |   | 35,287,777 |   |   |   | 37,565,101 |   |

----

| 8. | Mineral interests (continued) |
|----|-------------------------------|

|                                           |   | 2016   |       |   | 2015   |   |
|------------------------------------------------|--------|--------|------------|--------|--------|--------|
|                                           |   | $      |       |   | $      |   |
| Opening Balance – January 1              |   |   | 26,110,954 |   |   |   | - |   |
| Acquisition costs                              |   |   | -          |   |   |   | 25,312,695 |   |
| Drilling                                       |   |   | -          |   |   |   | 142,863 |   |
| Feasibility study                              |   |   | -          |   |   |   | 112,201 |   |
| Consulting                                     |   |   | 18,102     |   |   |   | - |   |
| Salaries and benefits                          |   |   | 131,259    |   |   |   | 90,693 |   |
| Mine design                                    |   |   | 48,749     |   |   |   | - |   |
| Others                                         |   |   | 1,928      |   |   |   | 446 |   |
| Effect of change in the exchange rate with RMB |   |   | (2,457,190 | )      |   |   | 452,056 |   |
| Ending Balance – December 31             |   |   | 23,853,802 |   |   |   | 26,110,954 |   |

----

| 9. | Non-controlling interest (“NCI”) |
|----|----------------------------------------------|

|                |   | December 31, 2016 |       |   | December 31, 2015 |   |
|---------------------|--------|-------------------|------------|--------|-------------------|--------|
|                |   | $                 |       |   | $                 |   |
| NCI percentage      |   |              | 49         | %      |              |   | 49 | % |
| Current assets      |   |              | 272,119    |   |              |   | 977,783 |   |
| Current liabilities |   |              | (109,658   | )      |              |   | (154,860 | ) |
| Net current assets  |   |              | 162,461    |   |              |   | 822,923 |   |
| Non-current asset   |   |              | 23,368,426 |   |              |   | 26,110,954 |   |
| Net assets          |   |              | 23,530,888 |   |              |   | 26,933,877 |   |
| Accumulated NCI     |   |              | 11,318,341 |   |              |   | 12,760,905 |   |
|                                       |   |
|--------------------------------------------|--------|
|                                       |   | Year ended December 31,2016 |   |   | For the period endedfrom August 1 toDecember 31, 2015 |   |
|                                       |   | $ |   |   | $ |   |
| Net loss                                   |   |   | 374,316 |   |   |   | 298,447 |   |
| Loss allocated to non-controlling interest |   |   | 183,415 |   |   |   | 146,239 |   |
|                                    |   |                        |      |   |                                                  |   |
|-----------------------------------------|--------|-----------------------------|-----------|--------|-------------------------------------------------------|--------|
|                                    |   | Year ended December 31,2016 |      |   | For the period endedfrom August 1 toDecember 31, 2015 |   |
|                                    |   | $                           |      |   | $                                                     |   |
| Cash outflows from operating activities |   |                        | 1,081,958 |   |                                                  |   | 45,695 |   |
| Cash outflows from investing activities |   |                        | 512,078   |   |                                                  |   | 169,639 |   |
|                                    |   |                        |      |   |                                                  |   |   |   |

----

| 10. | Investments |
|-----|-------------|

|                                         |   | Fair valueDecember 31,2014 |       |   | Fair valueadjustmentMay 21, 2015 |   |      | Net disposalsMay 21, 2015 |   |   | Fair valueDecember 31,2015 |   |
|----------------------------------------------|--------|----------------------------|------------|--------|----------------------------------|--------|-----------|---------------------------|--------|--------|----------------------------|--------|
|                                         |   | $                          |       |   | $                                |   |      | $                         |   |   | $                          |   |
| Common shares in Gold Road Resources Limited |   |                       | 10,865,140 |   |                             |   | 7,817,064 |                      |   |   | (18,682,204                | )      |   |   | - |   |
| Total                                        |   |                       | 10,865,140 |   |                             |   | 7,817,064 |                      |   |   | (18,682,204                | )      |   |   | - |   |

| 11. | Share capital |
|-----|---------------|

| (a) |       Common Shares |
|-----|---------------------------------------------------|

| (b) |        Long-term Incentive Plan |
|-----|--------------------------------------------------------------------|

----

| 11. | Share capital (continued) |
|-----|---------------------------|

|                       |   | Numberoutstanding |       |   | Weightedaverage exerciseprice |   |
|----------------------------|--------|-------------------|------------|--------|-------------------------------|--------|
|                       |   |              |       |   | $                             |   |
|                       |   |              |       |   |                          |   |
| Balance, January 1, 2015   |   |              | 6,477,835  |   |                          |   | 2.58 |   |
|                       |   |              |       |   |                          |   |   |   |
| Granted                    |   |              | 1,690,000  |   |                          |   | 0.42 |   |
| Expired                    |   |              | (350,836   | )      |                          |   | 3.03 |   |
| Forfeited                  |   |              | (1,331,332 | )      |                          |   | 1.72 |   |
|                       |   |              |       |   |                          |   |   |   |
| Balance, December 31, 2015 |   |              | 6,485,667  |   |                          |   | 2.16 |   |
|                       |   |              |       |   |                          |   |   |   |
| Exercised                  |   |              | (614,995   | )      |                          |   | 0.59 |   |
| Expired                    |   |              | (1,305,000 | )      |                          |   | 5.31 |   |
| Forfeited                  |   |              | (285,000   | )      |                          |   | 2.08 |   |
|                       |   |              |       |   |                          |   |   |   |
| Balance, December 31, 2016 |   |              | 4,280,672  |   |                          |   | 1.43 |   |
| Options outstanding                |              | Options exercisable                             |
|------------------------------------|-------------------|-------------------------------------------------|
|   Range ofexerciseprices | NumberOutstanding | Weightedaverageremainingcontractuallife (years) |  Weightedaverageexerciseprice |   |    Numberexercisable |  Weightedaverageexerciseprice |
| $                                  |              |                                            | $ |   |   | $ |
| 0.42 – 0.79                  | 1,151,672         | 3.71                                            | 0.42 |   | 654,999 | 0.42 |
| 0.80 – 0.81                  | 705,000           | 2.06                                            | 0.80 |   | 705,000 | 0.80 |
| 0.82 – 2.00                  | 954,000           | 1.07                                            | 1.71 |   | 954,000 | 1.71 |
| 2.01 – 2.35                  | 1,470,000         | 0.24                                            | 2.35 |   | 1,470,000 | 2.35 |
|                               | 4,280,672         | 1.66                                            | 1.43 |   | 3,783,999 | 1.56 |

----

| 11. | Share capital (continued) |
|-----|---------------------------|

|                     | 2016 | 2015        | 2014          |
|--------------------------|------|-------------|---------------|
| Risk-free interest rate  | -    | 0.46%-1.69% | 1.21% - 1.69% |
| Dividend yield           | -    | 0%          | 0%            |
| Volatility               | -    | 71% - 76%   | 71% - 76%     |
| Forfeiture rate          | -    | 27%         | 26%           |
| Estimated expected lives | -    | 5 years     | 5 years       |
|                                         | Number outstanding |   | Weighted average fair value |
|----------------------------------------------|--------------------|--------|-----------------------------|
|                                         |               |   | $                           |
|                                         |               |   |                        |
| Balance, January 1, 2014                     | 280,000            |   | 1.64                        |
|                                         |               |   |                        |
| Exercised                                    | (280,000)          |   | 1.64                        |
|                                         |               |   |                        |
| Balance, December 31, 2014 and 2015 and 2016 | -                  |   | -                           |
|                                         |               |   |                        |

----

| 11. | Share capital (continued) |
|-----|---------------------------|

|                       | Number outstanding |   | Weighted average fair value |
|----------------------------|--------------------|--------|-----------------------------|
|                       |               |   | $                           |
|                       |               |   |                        |
| Balance, January 1, 2015   | 885,000            |   | 0.80                        |
|                       |               |   |                        |
| Forfeited                  | (150,000)          |   | 0.80                        |
|                       |               |   |                        |
| Balance, December 31, 2015 | 735,000            |   | 0.80                        |
|                       |               |   |                        |
| Forfeited                  | (735,000)          |   | 0.80                        |
|                       |               |   |                        |
| Balance, December 31, 2016 | -                  |   | -                           |
| Year ended December 31,                                                                                         |   | 2016   |     |   | 2015   |   |
|-----------------------------------------------------------------------------------------------------------------|--------|--------|----------|--------|--------|--------|
|                                                                                                            |   |   |     |   |   |   |
| Share-based compensation (recovery) charged to the statement of operations                                      |   |   | (39,966  | )      |   |   | 11,108 |   |
| Addition (reduction) of capitalized share-based compensation within the Company’s’ mineral interest |   |   | (289,251 | )      |   |   | 150,440 |   |
| Total share-based compensation expenditure  (recovery)                                                     |   |   | (329,217 | )      |   |   | 161,548 |   |

----

| 12. | Income taxes |
|-----|--------------|

|                                               |   | 2016   |       |   | 2015   |   |       | 2014   |   |
|----------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|
|                                               |   | $      |       |   | $      |   |       | $      |   |
| Income (loss) before income taxes                  |   |   | (2,407,668 | )      |   |   | 6,680,947  |   |   |   | (1,665,518 | ) |
|                                               |   |   |       |   |   |   |       |   |   |   |   |   |
| Statutory income tax rate                          |   |   | 26         | %      |   |   | 26         | %      |   |   | 26 | % |
|                                               |   |   |       |   |   |   |       |   |   |   |   |   |
| Expected tax recovery at statutory income tax rate |   |   | (625,994   | )      |   |   | 1,737,046  |   |   |   | (433,035 | ) |
| Non-deductible expenses and other items            |   |   | 509,573    |   |   |   | 63,663     |   |   |   | (118,206 | ) |
| Difference in tax rates                            |   |   | 4,524      |   |   |   | (607,441   | )      |   |   | 13,434 |   |
| Temporary differences from acquisition transaction |   |   | -          |   |   |   | (3,435,860 | )      |   |   | - |   |
| Change in deferred income tax asset not recognized |   |   | (95,308    | )      |   |   | 2,858,979  |   |   |   | 625,349 |   |
| Foreign exchange                                   |   |   | 207,205    |   |   |   | (616,387   | )      |   |   | (87,542 | ) |
|                                               |   |   |       |   |   |   |       |   |   |   |   |   |
| Income tax expense                                 |   |   | -          |   |   |   | -          |   |   |   | - |   |
|                                      |   | 2016   |      |   | 2015   |   |
|-------------------------------------------|--------|--------|-----------|--------|--------|--------|
|                                      |   | $      |      |   | $      |   |
| Deferred income tax assets not recognized |   |   |      |   |   |   |
| Non-capital losses                        |   |   | 5,188,584 |   |   |   | 5,313,066 |   |
| Mineral interests                         |   |   | 1,613,372 |   |   |   | 1,549,489 |   |
| Other                                     |   |   | -         |   |   |   | 34,708 |   |
|                                      |   |   | 6,801,956 |   |   |   | 6,897,264 |   |
|   |   | $         |
|--------|--------|-----------|
| 2030   |   | 1,614,942 |
| 2031   |   | 1,880,258 |
| 2032   |   | 2,229,724 |
| 2034   |   | 1,470,692 |
| 2036   |   | 830,278   |
|   |   | 8,025,894 |

----

| 13. | Related party transactions |
|-----|----------------------------|

| (a) |         Funding of Changfu Minco |
|-----|--------------------------------------------------------------------------|

----

| 13. | Related party transactions (continued) |
|-----|----------------------------------------|

|                           |   | December 31, 2016 |    |   | December 31, 2015 |   |
|--------------------------------|--------|-------------------|---------|--------|-------------------|--------|
|                           |   | $                 |    |   | $                 |   |
| Due from Minco Gold            |   |              | -       |   |              |   | 177,330 |   |
| Due from Minco Base Metal (i)  |   |              | 163,167 |   |              |   | - |   |
| Total due from related parties |   |              | 163,167 |   |              |   | 177,330 |   |
|                           |   |              |    |   |              |   |   |   |
| Due to Minco Gold (ii)         |   |              | 205,145 |   |              |   | - |   |
|                                                                                                                                                                                                             |   | Years ended December 31, |        |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------|-------------|
|                                                                                                                                                                                                             |   | 2016                     |        |   | 2015 |   |   | 2014 |   |
|                                                                                                                                                                                                             |   | $                        |        |   | $ |   |   | $ |   |
| Cash remuneration                                                                                                                                                                                                |   |                     | 757,649     |   |   |   | 784,608 |   |   |   | 1,026,436 |   |
| Share-based compensation                                                                                                                                                                                         |   |                     | (46,798)(i) |   |   |   | 274,632 |   |   |   | 745,925 |   |
|                                                                                                                                                                                                             |   |                     | 710,851     |   |   |   | 1,059,240 |   |   |   | 1,772,361 |   |
| (i) Share based compensation earned by management during 2016 consisted of the share based compensation earned from option vesting of 387,048, net of the effect of the PSU reversal of (433,846) (Note 11 (b)). |   |

----

| 14. | Geographical information |
|-----|--------------------------|

| Non-current assets by geography |   |   |       |   |              |              |       |   |   |
|---------------------------------|--------|--------|------------|--------|-------------------|-------------------|------------|--------|--------|
|                            |   |   |       |   | December 31, 2016 |              |
|                            |   | Canada |       |   | China             |              |       | Total  |   |
|                            |   | $      |       |   | $                 |              |       | $      |   |
| Current assets                  |   |   | 20,946,132 |   |              |              | 31,566,620 |   |   |   | 52,512,752 |   |
| Non-current assets              |   |   | 8,588      |   |              |              | 59,428,603 |   |   |   | 59,437,191 |   |
|                            |   |   |       |   |              |              |       |   |   |   |   |   |
|                            |   |   |       |   |              | December 31, 2015 |       |
|                            |   | Canada |       |   | China             |              |       | Total  |   |
|                            |   |   | $          |   |              |              | $          |   |   |   | $ |   |
| Current assets                  |   |   | 32,679,357 |   |              |              | 26,562,611 |   |   |   | 59,241,968 |   |
| Non-current assets              |   |   | 12,459     |   |              |              | 64,098,595 |   |   |   | 64,111,054 |   |

| 15. | Commitments |
|-----|-------------|

|              | $       |
|-------------------|---------|
| 2017              | 551,934 |
| 2018              | 52,989  |
| 2019              | 6,390   |
| 2020 – 2022 | 14,911  |
|              | 626,224 |

----

| 16. | Financial instruments and fair values |
|-----|---------------------------------------|

|                      |   |              |       |   |              |   |
|---------------------------|--------|-------------------|------------|--------|-------------------|--------|
|                      |   | December 31, 2016 |       |   | December 31, 2015 |   |
| Loans and receivables     |   | $                 |       |   | $                 |   |
| Cash and cash equivalents |   |              | 20,195,199 |   |              |   | 26,202,564 |   |
| Short-term investments    |   |              | 31,410,880 |   |              |   | 32,143,068 |   |
| Receivables               |   |              | 541,293    |   |              |   | 517,359 |   |
| Due from related parties  |   |              | 163,167    |   |              |   | 177,330 |   |
|                      |   |              |       |   |              |   |   |   |
|                                     |   | December 31, 2016 |    |   | December 31, 2015 |   |
|------------------------------------------|--------|-------------------|---------|--------|-------------------|--------|
| Other financial liabilities              |   |                   | $       |   |              |        | $ |   |
| Due to related party                     |   |              | 205,145 |   |              |   | - |   |
| Accounts payable and accrued liabilities |   |              | 424,635 |   |              |   | 638,550 |   |

----

| 16. | Financial instruments and fair values (continued) |
|-----|---------------------------------------------------|

| 17. | Capital management |
|-----|--------------------|

----

| 18. | Subsequent events |
|-----|-------------------|

----

----