UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                    FORM 10-Q


(x)      Quarterly report pursuant to section 13 or 15(d) of the Securities
         Exchange Act of 1934.

                  For the Quarterly Period Ended June 30, 1998

( )      Transition report pursuant to section 13 or 15(d) of the Securities 
         Exchange Act of 1934.

               For the transition period from _______ to ________

                          Commission File Number 1-8736


                            HOMESTAKE MINING COMPANY


                             A Delaware Corporation

                   IRS Employer Identification No. 94-2934609


                              650 California Street
                      San Francisco, California 94108-2788
                            Telephone: (415) 981-8150
                            http://www.homestake.com



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

              Yes        X                       No   ______
                   -----------


The  number  of  shares of  common  stock  outstanding  as of August 7, 1998 was
211,183,900.


                                     Page 1


<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES


PART 1 - FINANCIAL INFORMATION

Item 1. Financial Statements

A.   Condensed Consolidated Balance Sheets (unaudited)
     (In thousands, except per share amount)
<TABLE>
<CAPTION>
                                                                                    June 30,                December 31,
                                                                                       1998                     1997
                                                                                 ---------------          -----------------
<S>                                                                              <C>                       <C>
ASSETS
Current assets
     Cash and equivalents                                                        $      134,219            $       124,083
     Short-term investments                                                             149,699                    141,221
     Receivables                                                                         48,711                     43,529
     Inventories:
         Finished products                                                               22,283                     33,019
         Ore and in process                                                              29,999                     37,811
         Supplies                                                                        31,149                     33,095
     Deferred income and mining taxes                                                    26,465                     19,372
     Other                                                                                7,669                     13,154
                                                                                 ---------------          -----------------
         Total current assets                                                           450,194                    445,284
                                                                                 ---------------          -----------------

Property, plant and equipment - at cost                                               2,204,344                  2,222,465
     Accumulated depreciation, depletion and amortization                            (1,271,610)                (1,201,318)
                                                                                 ---------------          -----------------
         Property, plant and equipment - net                                            932,734                  1,021,147
                                                                                 ---------------          -----------------

Investments and other assets
     Noncurrent investments                                                              33,054                     41,094
     Other assets                                                                        89,479                    102,009
                                                                                 ---------------          -----------------
         Total investments and other assets                                             122,533                    143,103
                                                                                 ---------------          -----------------
Total Assets                                                                     $    1,505,461            $     1,609,534
                                                                                 ===============          =================

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
     Accounts payable                                                            $       47,015            $        59,930
     Accrued liabilities:
         Payroll and other compensation                                                  27,761                     23,898
         Unrealized loss on foreign currency exchange contracts                          28,921                     20,416
         Reclamation and closure costs                                                   12,166                     11,818
         Other                                                                           17,151                     12,509
     Income and other taxes payable                                                       9,422                        277
                                                                                 ---------------          -----------------
         Total current liabilities                                                      142,436                    128,848
                                                                                 ---------------          -----------------

Long-term liabilities
     Long-term debt                                                                     356,069                    374,593
     Other long-term obligations                                                        143,871                    152,610
                                                                                 ---------------          -----------------
         Total long-term liabilities                                                    499,940                    527,203
                                                                                 ---------------          -----------------

Deferred income and mining taxes                                                        146,105                    161,862

Minority interests in consolidated subsidiaries                                         112,232                    108,116

Shareholders' equity
     Capital stock, $1 par value per share:
         Preferred - 10,000 shares authorized; no shares outstanding 
         Common - 250,000 shares authorized; shares outstanding:
            1998 - 211,162; 1997 - 210,696                                              211,162                    210,696
     Other shareholders' equity                                                         393,586                    472,809
                                                                                 ---------------          -----------------
         Total shareholders' equity                                                     604,748                    683,505
                                                                                 ---------------          -----------------
Total Liabilities and Shareholders' Equity                                       $    1,505,461            $     1,609,534
                                                                                 ===============          =================

See notes to the condensed consolidated financial statements.
</TABLE>

                                       2
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES



B.    Condensed Statements of Consolidated Operations (unaudited)
      (In thousands, except per share amounts)
<TABLE>
<CAPTION>

                                                              Three Months Ended                       Six Months Ended
                                                                   June 30,                                June 30,
                                                              1998               1997                  1998              1997
                                                       --------------     --------------        --------------    --------------

<S>                                                     <C>                <C>                  <C>                <C>
Revenues
      Gold and ore sales                                $    210,687       $    214,393         $     405,026      $    442,218
      Sulfur and oil sales                                     5,665              6,842                11,798            13,794
      Interest income                                          5,218              4,797                 9,477             9,106
      Gain on termination of Santa Fe merger                                                                             62,925
      Other income                                           (26,285)                28               (14,799)           15,355
                                                       --------------     --------------        --------------    --------------
                                                             195,285            226,060               411,502           543,398
                                                       --------------     --------------        --------------    --------------
Costs and Expenses
      Production costs                                       142,749            154,831               278,306           319,721
      Depreciation, depletion and amortization                37,402             34,047                73,492            73,590
      Administrative and general expense                      11,272             12,029                23,837            21,821
      Exploration expense                                     11,509             18,138                21,806            30,073
      Interest expense                                         5,216              5,413                10,328            10,281
      Write-downs and other unusual charges                    2,905             65,115                11,784            65,115
      Business combination and integration costs              17,934                                   20,710
      Other expense                                              419              2,785                   798             3,427
                                                       --------------     --------------        --------------    --------------
                                                             229,406            292,358               441,061           524,028
                                                       --------------     --------------        --------------    --------------

Income (Loss) Before Taxes and Minority Interests            (34,121)           (66,298)              (29,559)           19,370
Income and Mining Taxes                                        4,878              3,858                (2,342)          (31,047)
Minority Interests                                            (1,688)            (2,417)               (5,616)           (4,924)
                                                       --------------     --------------        --------------    --------------
Net Loss                                                $    (30,931)      $    (64,857)        $     (37,517)     $    (16,601)
                                                       ==============     ==============        ==============    ==============


Net Loss Per Share - Basic and Diluted                  $      (0.15)      $      (0.31)        $       (0.18)     $      (0.08)
                                                       ==============     ==============        ==============    ==============

Average Shares Used in the Computation                       211,060            210,567               210,860           210,534
                                                       ==============     ==============        ==============    ==============

Dividends Paid Per Common Share                         $       0.05       $       0.05         $        0.05      $       0.10
                                                       ==============     ==============        ==============    ==============



See notes to the condensed consolidated financial statements.
</TABLE>



                                       3

<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES



C.  Condensed Statements of Consolidated Cash Flows (unaudited)
    (In thousands)
<TABLE>
<CAPTION>

                                                                                        Six Months Ended June 30,
                                                                                      1998                        1997
                                                                              -----------------           ------------------
<S>                                                                            <C>                         <C>
Cash Flows from Operations
    Net loss                                                                   $       (37,517)            $        (16,601)
    Reconciliation to net cash provided by operations:
       Depreciation, depletion and amortization                                         73,492                       73,590
       Write-downs                                                                       2,905                       65,115
       Deferred taxes, minority interests and other                                    (21,575)                      11,332
       Gains on asset disposals                                                         (1,844)                     (17,884)
       Effect of changes in operating working capital items                             48,311                       (5,798)
                                                                              -----------------           ------------------
    Net cash provided by operations                                                     63,772                      109,754
                                                                              -----------------           ------------------

Investment Activities
    Increase in short-term investments                                                 (11,308)                     (33,630)
    Capital additions                                                                  (33,894)                    (101,897)
    Proceeds from asset sales                                                            7,841                       15,451
    Other                                                                                  113                       (2,603)
                                                                              -----------------           ------------------
    Net cash used in investment activities                                             (37,248)                    (122,679)
                                                                              -----------------           ------------------

Financing Activities
    Borrowings                                                                                                       27,917
    Debt repayments                                                                     (8,024)
    Dividends paid - Homestake                                                          (7,339)                     (14,670)
                   - Plutonic                                                           (3,554)                      (9,768)
                   - Prime minority interests                                           (1,040)                      (1,085)
    Common shares issued                                                                 1,038                          808
    Other                                                                                2,531                        2,655
                                                                              -----------------           ------------------
Net cash provided by (used in) financing activities                                    (16,388)                       5,857
                                                                              -----------------           ------------------

Net increase (decrease) in cash and equivalents                                         10,136                       (7,068)

Cash and equivalents, January 1                                                        124,083                      104,657
                                                                              -----------------           ------------------

Cash and equivalents, June 30                                                  $       134,219             $         97,589
                                                                              =================           ==================

See notes to the condensed consolidated financial statements.
</TABLE>


                                       4

<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES
                                        
Notes to Condensed Consolidated Financial Statements (unaudited)

1.       The condensed  consolidated financial statements included herein should
         be read in conjunction with the financial statements and notes thereto,
         which include information as to significant  accounting  policies,  for
         the year ended December 31, 1997. Year end financial statements for the
         Company,  restated to include Plutonic on a pooling-of-interests  basis
         (see note 2 below),  have been filed with the  Securities  and Exchange
         Commission on Form 8-K dated June 22, 1998.

         The  information  furnished  in this report  reflects  all  adjustments
         which, in the opinion of management, are necessary for a fair statement
         of the results for the interim periods.  Except as described in notes 2
         through  6, such  adjustments  consist  of items of a normal  recurring
         nature.  Results of operations for interim  periods are not necessarily
         indicative of results for the full year.

         All  dollar  amounts  are in United  States  dollars  unless  otherwise
         indicated.

2.       On April 30,  1998  Homestake  completed  the  acquisition  of Plutonic
         Resources  Limited  ("Plutonic"),  a  publicly-traded  Australian  gold
         producer,  by an exchange of common stock for common  stock.  Homestake
         issued 64.4 million common shares to acquire  Plutonic,  including 63.9
         million  shares in exchange for all of the Plutonic fully paid ordinary
         shares  outstanding based on an exchange ratio of 0.34 Homestake common
         shares for each  Plutonic  fully paid ordinary  share,  and 0.5 million
         Homestake common shares for the Plutonic partly-paid shares and options
         outstanding.

         The business  combination  with  Plutonic has been  accounted  for as a
         pooling  of  interests  and,  accordingly,   Homestake's   consolidated
         financial  statements  have been  restated to include  Plutonic for all
         periods. Combined and separate preacquisition results for Homestake and
         Plutonic  for the three  months  ended March 31, 1998 and for the three
         and six months ended June 30, 1997 are as follows (in thousands):
<TABLE>
<CAPTION>
                                         Homestake       Plutonic
                                        Historical       Historical a  Adjustments  b   Combined
                                       -------------------------------------------------------------
<S>                                      <C>             <C>              <C>            <C>
Three months ended March 31, 1998
    Revenues                             $ 174,343       $ 43,624         $ (1,750)      $ 216,217
    Net loss                                (4,611)           (76)          (1,899)         (6,586)

Three months ended June 30, 1997
    Revenues                             $ 168,659       $ 64,427         $ (7,026)      $ 226,060
    Net loss                               (16,222)       (39,633)          (9,002)        (64,857)

Six months ended June 30, 1997
    Revenues                             $ 418,846       $ 121,035         $ 3,517       $ 543,398
    Net income (loss)                       33,638        (34,541)         (15,698)        (16,601)

<FN>
         a) The Plutonic  historical results of operations have been adjusted to
         reflect  i)  presentation  of  Plutonic's   results  of  operations  in
         accordance with United States generally accepted accounting  principles
         and the format  and  classifications  utilized  by  Homestake,  and ii)
         translation  into U.S. dollars using the average exchange rate for each
         period.

                                       5
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES



         b) In  combining  the  historical  results of Homestake  and  Plutonic,
         certain adjustments were made to conform Plutonic's accounting policies
         to Homestake's  accounting policies. The effect of these adjustments on
         combined net income (loss) is as follows (in thousands):

</FN>

<CAPTION>

                                 Three months ended          Three months ended     Six months ended
                                      March 31,                    June 30,              June 30,
Increase (Decrease)                      1998                       1997                  1997
                                ----------------------------------------------------------------------
<S>                                   <C>                        <C>                    <C>      
Revenue recognition                   $ (1,293)                  $ (3,142)              $ (1,848)
Reclamation expense                        474                        (61)                   710
Depreciation, depletion
     and amortization                    1,141                      2,102                  4,204
Income taxes                            (1,009)                     3,819                  8,936
                                ----------------------------------------------------------------------
                                      $ (1,899)                  $ (9,002)             $ (15,698)
                                ======================================================================

</TABLE>


3.       Other income for the three and six months ended June 30 is as follows
         (in millions):
<TABLE>
<CAPTION>

                                                 Three Months Ended                   Six Months Ended
                                                       June 30,                            June 30,
                                         -------------------------------      ------------------------------
                                               1998              1997               1998            1997
                                         --------------    -------------      --------------   -------------

<S>                                             <C>              <C>                 <C>            <C>  
Gains on asset disposals                        $1.6             $2.5                $1.8           $17.9
Gain on sales of Rabbi
     Trust investments                           0.3              -                   4.3             -
Royalty income                                   0.6              0.6                 1.2             1.2
Foreign currency contract
     gains (losses)                            (26.5)            (2.8)              (22.4)           (3.8)
Foreign currency exchange
     losses on intercompany
     advances                                   (4.4)            (2.4)               (3.5)           (2.8)
Other foreign currency
     gains (losses)                              0.4              -                   0.5            (0.3)

Other                                            1.7              2.1                 3.3             3.2
                                        --------------    -------------      --------------   -------------
                                              ($26.3)         $   -                ($14.8)          $15.4
                                        ==============    =============      ==============   =============
</TABLE>


4.       In January 1998, the Company began a major  restructuring of operations
         at the Homestake mine in order to reduce  operating  costs. The Company
         suspended  underground  mining  for  approximately  60  days  while  it
         completed the final  details of the new operating  plan and readied the
         underground mine to begin operating on the restructured basis. Open Cut
         ore  stockpiles  continued  to be  processed  through  the  mill  at an
         accelerated rate while the underground  operations were suspended.  The
         new mine plan  specifically  is  designed  to improve  the grade of ore
         recovered through the increased use of mechanized  cut-and-fill  mining
         methods.  When  fully  implemented,  the plan will  reflect a  complete
         reorganization of underground  activities,  a significant  reduction in
         the mine's work force and a reduction in future gold production.

         Write-downs and other unusual expenses during the six months ended June
         30,  1998  include  $8.9  million  ($5.9  million  after  tax) of costs
         associated  with  the  temporary   suspension  of  operations  and  the
         reduction  of 450  employees in the work force.  These costs  primarily
         represent wage payments to the work force during the temporary shutdown

                                       6
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES


         and severance payments and benefit costs for the severed employees, and
         are net of  approximately  $9.3  million of pension  and  benefit  plan
         curtailment gains.

5.       In March  1997,  Santa  Fe  Pacific  Gold  Corporation  terminated  its
         previously announced merger agreement with Homestake and paid Homestake
         a $65  million  termination  fee. As a result,  the Company  recorded a
         pretax  gain  of  $62.9  million  ($47.2  million  after  tax),  net of
         merger-related expenses of $2.1 million incurred in 1997.

6.       In February  1997,  Homestake sold its interests in the George Lake and
         Back  River  joint  ventures  in  Canada to Kit  Resources  Corporation
         ("Kit") for $9.3  million in cash and 3.6 million  shares of Kit common
         stock. As a result of this  transaction,  the Company recorded a pretax
         gain of $13.5  million ($8.1 million after tax) in the first quarter of
         1997, which is included in other income.

7.       In June 1998,  Plutonic repaid $8 million of its debt outstanding under
         its syndicated credit facility. Borrowings outstanding at June 30, 1998
         included  borrowings  of $95.5 million by Plutonic and $45.6 million by
         HGAL under the Company's then-existing credit facilities.

         In   July   1998,    the   Company    entered   into   a   new   United
         States/Canadian/Australian  cross-border  credit  facility  providing a
         total  availability  of $430  million.  The new  facility  replaces the
         Company's  $275 million  cross-border  credit  facility and  Plutonic's
         A$400 million syndicated credit facility, each of which were cancelled.
         Borrowings by Plutonic and HGAL under the prior credit  facilities were
         repaid using the new  facility.  The new facility is available  through
         July 14, 2003 and provides for borrowings in United  States,  Canadian,
         or Australian  dollars,  or gold, or a combination of these.  Under the
         new facility,  the Company pays a commitment  fee ranging from 0.15% to
         0.35% per  annum,  depending  upon  rating  agencies'  ratings  for the
         Company's senior debt, on the unused portion of this facility.  The new
         credit  agreement  requires  a minimum  consolidated  net worth of $500
         million. Interest on the HGAL and Plutonic Australian dollar borrowings
         under  the new  facility  is  payable  quarterly  and is  based  on the
         Australian  Bank Bill Swap Rate plus a margin of up to 1.125%.  At July
         31, 1998 the interest rate was 6.22%.

8.       Under the Company's foreign currency  protection  program,  the Company
         has entered into a series of foreign  currency  option  contracts which
         establish  trading  ranges within which the United States dollar may be
         exchanged  for  foreign  currencies  by  setting  minimum  and  maximum
         exchange rates.

         At June 30, 1998 the Company had forward currency contracts outstanding
         as follows (dollar amounts in thousands):
<TABLE>
<CAPTION>

                                                   Weighted-Average Exchange
                   Amount Covered                    Rates to U.S. Dollars              Expiration
Currency             (U.S. Dollars)            Put Options        Call Options             Dates
------------------------------------------------------------------------------------------------------
<S>                          <C>                  <C>                 <C>                  <C> 
Canadian                     $ 96,800             0.72                0.75                 1998
Canadian                      123,300             0.70                0.73                 1999
Canadian                       89,200             0.69                0.72                 2000
Canadian                       16,500             0.68                0.71                 2001
Australian                     50,800             0.73                0.76                 1998
Australian                     84,000             0.67                0.70                 1999
Australian                     62,600             0.65                0.68                 2000
Australian                     17,000             0.62                0.65                 2001
                     -----------------
                            $ 540,200
                     =================
</TABLE>

                                       7

<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES



         The Company  delivered or financially  settled during the three and six
         months  ended June 30,  1998,  30,000  and  60,000  ounces of its North
         American  gold  production  at an  average  price  of $398 and $396 per
         ounce, respectively.  This compares to settlements of 30,000 and 60,000
         ounces at an average  price of $380 and $381 per ounce during the three
         and six months ended June 30, 1997, respectively.

         The Company  delivered or financially  settled during the three and six
         months ended June 30, 1998, 55,900 and 178,900 ounces of its Australian
         gold  production  at an  average  price of $372  and  $339  per  ounce,
         respectively.  This  compares  to  settlements  of 124,300  and 265,150
         ounces at an average  price for both  periods of $429 per ounce  during
         the three  and six  months  ended  June 30,  1997.  During  June  1998,
         Homestake   closed   out  one   million   ounces   of  the   Australian
         dollar-denominated  forward gold  contracts  which Plutonic had entered
         into prior to its  acquisition  by  Homestake.  The  pretax  gain of $5
         million  realized as a result of this action was  deferred  and will be
         recorded into income as the originally designated production is sold.

         At June 30, 1998 the Company's gold forward sales  commitments  were as
         follows:
<TABLE>
<CAPTION>
                           US $ Denominated                       Australian $ Denominated
                 --------------------------------------     --------------------------------------
                                     Average Price of                           Average Price of
                   Forward Sales      Forward Sales           Forward Sales      Forward Sales
    Year            (ounces)           (per ounce)             (ounces)         (US$ per ounce)
-------------    --------------------------------------     --------------------------------------
    <S>                 <C>                <C>                      <C>               <C> 
    1998                 60,000           $403                      60,000           $320
    1999                109,900            415
    2000                 85,100            430                      24,800            320
    2001                 95,000            441                      24,800            320
    2002                 95,000            457                      24,800            320
   Thereafter            75,000            481                      75,600            320
                 ---------------                            ---------------
                        520,000                                    210,000
                 ===============                            ===============
</TABLE>
 

         To provide  protection  against a decrease in gold  prices,  during the
         third quarter of 1997 the Company entered into a series of put and call
         option contracts to provide a floor price of $325 per ounce for 900,000
         ounces of Homestake's expected 1998 gold production.  Gold sales during
         the second  quarter of 1998 include  225,000 ounces at an average price
         $325 per ounce and year-to-date revenues in 1998 include 450,000 ounces
         at $325 per ounce  under this  program.  At June 30,  1998 the  Company
         owned put options for 450,000 ounces of gold exercisable during 1998 at
         a price of $325 per ounce.  The Company  also had written  call options
         outstanding  for 450,000  ounces of gold  exercisable  during 1998 at a
         price of $325 per ounce and owned call  options for  450,000  ounces of
         gold exercisable during 1998 at a price of $336 per ounce.

         At June 30, 1998 the Company  also owned put options for 30,000  ounces
         of gold  exercisable  during  2000 at a price of $350 per ounce and had
         written call options  outstanding for 15,000 ounces of gold exercisable
         during 2000 at an average price of $395 per ounce.

         In February 1998, Prime Resources Group Inc.  ("Prime"),  a 50.6%-owned
         subsidiary  of the Company,  adopted a gold and silver  hedging  policy
         which provides for the use of forward sales  contracts for up to 40% of
         each of the  following  five  year's  expected  annual  gold and silver
         production at prices in excess of certain targeted prices.  At June 30,
         1998 Prime had forward sales  outstanding for approximately 7.2 million
         ounces of silver  during the  period  1999  through  2001 at an average
         price of $6.28 per ounce.


                                       8
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES


9.       Effective  January 1, 1998 the Company adopted  Statement of Financial
         Accounting  Standards No. 130 ("SFAS 130"),  "Reporting  Comprehensive
         Income." SFAS 130 establishes  standards for the reporting and display
         of comprehensive income. The purpose of reporting comprehensive income
         is to present a measure of all  changes in  shareholders'  equity that
         result from recognized  transactions  and other economic events of the
         period, other than transactions with shareholders in their capacity as
         shareholders.  SFAS 130 requires that the components of  comprehensive
         income be  displayed  in  annual  financial  statements  with the same
         prominence as other financial  statements and that the total amount of
         comprehensive  income be  reported  in  interim  periods.  Homestake's
         comprehensive  income  (loss) for the three and six months ended June
         30, 1998 and 1997 was as follows (in thousands):
<TABLE>
<CAPTION>

                                                    Three months ended              Six months ended
                                                       June 30,                         June 30,
                                              1998             1997              1998           1997
                                          ---------------------------------------------------------------
<S>                                           <C>              <C>              <C>            <C>       
Net Loss                                      $ (30,931)       $ (64,857)       $ (37,517)     $ (16,601)
Other Comprehensive Income (Loss)
   Currency translation adjustments             (32,603)         (28,105)         (26,686)       (38,383)
   Unrealized losses on securities               (1,154)         (10,298)          (3,448)       (15,569)
                                          ---------------------------------------------------------------
Comprehensive Loss                            $ (64,688)      $ (103,260)       $ (67,651)     $ (70,553)
                                          ===============================================================

</TABLE>

         In February 1998,  the Financial  Accounting  Standards  Board ("FASB")
         issued  Statement  of  Financial  Accounting  Standards  No. 132 ("SFAS
         132"),  "Employers' Disclosures about Pensions and Other Postretirement
         Benefits." SFAS 132 revises  employers'  disclosures  about pension and
         other postretirement  benefit plans. It does not change the measurement
         or recognition  of those plans.  SFAS 132  standardizes  the disclosure
         requirements  for  pensions  and other  postretirement  benefits to the
         extent practicable,  requires additional  information on changes in the
         benefit obligations and fair values of plan assets that will facilitate
         financial analysis,  and eliminates certain disclosures.  SFAS 132 will
         be effective for the Company's financial  statements for the year ended
         December 31, 1998.

         In June 1998, FASB issued Statement of Financial  Accounting  Standards
         No.  133 ("SFAS  133"),  "Accounting  for  Derivative  Instruments  and
         Hedging   Activities."  SFAS  133  requires  that  all  derivatives  be
         recognized  as assets or  liabilities  and be  measured  at fair value.
         Gains  or  losses  resulting  from  changes  in  the  values  of  those
         derivatives  would  be  accounted  for  depending  on  the  use  of the
         derivatives  and whether they qualify for hedge  accounting as either a
         fair value  hedge or a cash flow  hedge.  The key  criterion  for hedge
         accounting is that the hedging relationship must be highly effective in
         achieving offsetting changes in fair value or cash flows of the hedging
         instruments  and the hedged  items.  SFAS 133 is  effective  for fiscal
         years beginning after June 15, 1999 but earlier  adoption is permitted.
         The Company  currently is evaluating  the impact that this  requirement
         will have on reported  operating results and financial position and has
         not yet determined when SFAS 133 will be adopted.

10.      On May 25, 1998  Homestake  announced that it had proposed to the Board
         of Directors  of Prime,  the  acquisition  by Homestake of the 49.4% of
         Prime held by the public and not already owned by Homestake.  Under the
         terms of the offer,  Prime  shareholders  would receive 0.675 Homestake
         common  shares or 0.675  Homestake  Canada  Inc.  ("HCI")  Exchangeable
         Shares for each Prime share held by them. Each HCI  Exchangeable  Share
         would be exchangeable for one Homestake common share at any time at the
         option of the holder.

         The  arrangement,  which is subject to the approval of the shareholders
         of both Homestake and Prime, would result in the issuance of a total of
         25.4 million Homestake common and


                                       9
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES


         HCI  Exchangeable  Shares in exchange for the 37.6 million Prime shares
         held by the minority shareholders of Prime.

11.      The Comprehensive  Environmental  Response,  Compensation and Liability
         Act  ("CERCLA")  imposes  heavy  liabilities  on persons who  discharge
         hazardous  substances.  The  Environmental  Protection  Agency  ("EPA")
         publishes a National  Priorities  List  ("NPL") of known or  threatened
         releases of such substances.

         Grants:  Homestake's former uranium millsite near Grants, New Mexico is
         listed on the NPL. The EPA  asserted  that  leachate  from the tailings
         contaminated   a  shallow   aquifer   used  by   adjacent   residential
         subdivisions. Homestake paid the costs of extending the municipal water
         supply to the affected homes and continues to operate a water injection
         and collection  system that has  significantly  improved the quality of
         the aquifer.  The Company has  decommissioned and disposed of the mills
         and has covered the tailings impoundments at the site. The total future
         cost  for   reclamation,   remediation,   monitoring  and   maintaining
         compliance at the Grants site is estimated to be $17.5 million.

         Title X of the  Energy  Policy Act of 1992 (the  "Act") and  subsequent
         amendments  to the Act  authorized  appropriations  of $335  million to
         cover the Federal  Government's  share of certain costs of reclamation,
         decommissioning  and remedial action for by-product material (primarily
         tailings)  generated  by certain  licensees  as an  incident of uranium
         sales to the Federal Government. Reimbursement is subject to compliance
         with regulations of the Department of Energy ("DOE"), which were issued
         in 1994.  Pursuant to the Act, the DOE is responsible for 51.2% of past
         and future  costs of  reclaiming  the Grants  site in  accordance  with
         Nuclear Regulatory  Commission license  requirements.  Through June 30,
         1998,  Homestake  had  received  $26  million  from  the  DOE  and  the
         accompanying  balance  sheet at June 30, 1998  includes  an  additional
         receivable  of  $6.3  million  for  the  DOE's  share  of   reclamation
         expenditures  made by Homestake through that date.  Homestake  believes
         that its share of the estimated remaining cost of reclaiming the Grants
         facility is fully  provided  in the  financial  statements  at June 30,
         1998.

         In 1983,  the state of New Mexico made a claim  against  Homestake  for
         unspecified   natural  resource  damages   resulting  from  the  Grants
         tailings. New Mexico has taken no action to enforce its claim.

         Whitewood  Creek:  Whitewood  Creek was a site where  mining  companies
         operating  in the Black  Hills of South  Dakota,  including  Homestake,
         placed mine tailings (ground rock) beginning in the nineteenth century.
         Some  tailings  placed in Whitewood  Creek  eventually  flowed into the
         Belle Fourche  River,  the Cheyenne  River and Lake Oahe.  Placement of
         mine tailings into  Whitewood  Creek was  authorized by the laws of the
         United States,  the Dakota territory and the State of South Dakota, and
         Whitewood Creek was later specifically designated by the State of South
         Dakota as a disposal  stream for mine  tailings and for the disposal of
         raw sewage and other  municipal  waste. In response to changes in legal
         requirements,  Homestake  ceased the  placement of mine  tailings  into
         Whitewood Creek and for many years the Homestake mine has impounded all
         mine tailings that are not redeposited in the mine.

         Deposits  of  tailings  along an  18-mile  stretch of  Whitewood  Creek
         formerly  constituted  a  site  on  the  NPL.  The  EPA  asserted  that
         discharges  of  tailings  by  mining  companies,  including  Homestake,
         contaminated the soil and streambed.  Homestake signed a Consent Decree
         with the EPA and carried out remedial  work.  The site was deleted from
         the NPL on August 13, 1996. In the deletion notice, the EPA stated that
         "EPA, in

                                       10
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES


         consultation  with the State of South Dakota,  have determined that the
         Site poses no significant threat to public health or the environment."

         In  September,  1997 the State of South Dakota filed an action  against
         Homestake,  alleging  that  Homestake's  disposal  of mine  tailings in
         Whitewood Creek resulted in injuries to natural  resources in Whitewood
         Creek,  the  Belle  Fourche  River,  the  Cheyenne  River and Lake Oahe
         (collectively  the "NRD  Site").  The  complaint  also alleges that the
         tailings  constitute a continuing  public nuisance.  The complaint asks
         for  abatement  of  the  nuisance,   response  costs,   damages  in  an
         unspecified amounts,  litigation costs and interest.  In November 1997,
         the United States  government  and the Cheyenne  River Sioux Tribe (the
         "federal trustees") filed a similar action alleging injuries to natural
         resources and seeking response costs,  damages in unspecified  amounts,
         litigation costs and attorneys fees.

         In its  answers,  Homestake  denies that there has been any  continuing
         damage to natural resources or nuisance as a result of the placement of
         tailings  in  Whitewood  Creek.  Among other  defenses,  it is also the
         position of Homestake  that as a result of the State of South  Dakota's
         ownership  of  Whitewood  Creek and state and  federal  designation  of
         Whitewood  Creek as an  authorized  disposal  site,  the State of South
         Dakota and the  federal  government  are  responsible  for all past and
         future damages.  Homestake has also counterclaimed against the State of
         South  Dakota  and  the  federal   trustees  seeking  cost  recoupment,
         contribution and indemnity.

         In the  opinion of  Homestake,  there is no basis for the claims by the
         State of South Dakota or by the federal trustees.  Homestake is also of
         the opinion that Homestake has valid defenses and counterclaims against
         the State of South Dakota and the federal  trustees,  and  cross-claims
         for  recovery,  contribution  and indemnity  against  other  government
         entities  and  other  persons  who  participated  in  ownership  and/or
         operation of Whitewood  Creek as a waste  disposal site or who disposed
         of waste in the NRD Site.

         Homestake,  the State of South  Dakota  and the  Federal  Trustees  are
         engaged in  settlement  discussions  with  respect to the  actions.  If
         settlement is not achieved, Homestake intends to vigorously defend this
         action and to seek recovery,  contribution and indemnity from the State
         of  South  Dakota  and  the  federal   trustees  for  past  and  future
         expenditures. Homestake also expects to seek recovery, contribution and
         indemnity  from  other  government   entities  and  other  persons  who
         participated  in ownership  and/or  operation  of Whitewood  Creek as a
         waste disposal site or who disposed of waste in the NRD Site.

         Homestake does not believe that resolution of these matters will have a
         material  effect on the business or  financial  condition or results of
         operations of Homestake.


                                       11
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES



Item 2 - Management's Discussion and Analysis of Financial Condition and Results
of Operations

(Unless  specifically  stated otherwise,  the following  information  relates to
amounts included in the consolidated  financial statements without reduction for
minority  interests.  Information for prior periods has been restated to include
Plutonic  which was  acquired  on April 30,  1998.  Homestake  reports per ounce
production  costs  in  accordance  with  the  "Gold  Institute  Production  Cost
Standard.")

On April 30, 1998  Homestake  completed the  acquisition  of Plutonic  Resources
Limited  ("Plutonic"),  an  Australian  gold  producer,  by issuing 64.4 million
shares with a market value of approximately $770 million.  Homestake issued 63.9
million  shares  in  exchange  for  all  Plutonic  fully  paid  ordinary  shares
outstanding  based on an exchange ratio of 0.34 Homestake common shares for each
Plutonic fully paid ordinary share, and 0.5 million  Homestake common shares for
the  Plutonic  partly  paid  shares  and  options   outstanding.   The  business
combination has been accounted for as a pooling of interests,  and  accordingly,
the Company's  consolidated  financial  statements have been restated to include
Plutonic for all prior periods.

                              RESULTS OF OPERATIONS

Homestake  recorded a net loss of $30.9  million  or $0.15 per share  during the
second  quarter  of 1998  compared  to a net loss of $64.9  million or $0.31 per
share during the second  quarter of 1997.  The 1998 second quarter loss includes
charges of $15 million  ($17.9  million  pretax) or $0.07 per share for business
combination and integration  costs related to the Plutonic  acquisition and $2.6
million ($2.9 million  pretax) or $0.02 per share for write-downs of exploration
properties.  Results  for the 1997 second  quarter  include  write-downs  of $50
million  ($65.1  million  pretax) or $0.24 per share taken  primarily  at the Mt
Morgans mine and the Meekatharra exploration property.

Excluding the effect of nonrecurring  items,  the Company incurred a net loss of
$13.3  million or $0.06 per share in the 1998 second  quarter  compared to a net
loss of $14.9  million  or $0.07  per  share in the  1997  second  quarter.  The
improved results reflect a substantial  decline in cash costs, higher production
and reduced  exploration  expenditures.  These  factors were offset in part by a
significant decline in the gold price, higher  mark-to-market  losses on foreign
currency  exchange  contracts,   and  increased   depreciation,   depletion  and
amortization expenses primarily due to higher sales volumes.

Gold  production in the second  quarter of 1998 was 656,600  ounces  compared to
626,700 ounces produced in the second quarter of 1997. During the second quarter
of 1998,  sales of equivalent  ounces of gold increased by 14% to 693,800 ounces
compared to 610,900 ounces in the second quarter of 1997. However,  gold and ore
sales revenue decreased to $210.7 million during the three months ended June 30,
1998 from $214.4 million in the corresponding prior year period due to a decline
in the average price of gold. The Company's  average  realized price declined to
$316 per  equivalent  ounce of gold in the second  quarter of 1998 from $362 per
equivalent ounce realized in the comparative 1997 period.

In January 1998,  the Company began a major  restructuring  of operations at the
Homestake  mine in  order to  reduce  operating  costs.  The  Company  suspended
underground  mining  for  approximately  60 days  while it  completed  the final
details of the new  operating  plan and  readied the  underground  mine to begin
operating on the  restructured  basis.  Open Cut ore stockpiles  continued to be
processed  through  the  mill  at an  accelerated  rate  while  the  underground
operations were suspended. The new mine plan specifically is designed to improve
the grade of ore recovered through the increased use of mechanized  cut-and-fill
mining methods.  When fully implemented,  the plan will reflect a reorganization
of underground activities and a significant


                                       12
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES



reduction in work force that will  generate  considerable  cost savings and will
increase the mine's future total  earnings and cash flow.  Homestake  expects to
invest up to $30  million  by the end of 1999 in the  restructuring  process  to
purchase  equipment,  and upgrade  facilities and  infrastructure.  Once the new
operating plan is fully  implemented by the end of 1999,  annual gold production
is expected to be between 150,000 and 180,000  ounces.  Total cash costs for the
underground  operations are projected to decline to $280 per ounce from the 1997
levels of approximately $335 per ounce.  Underground crews returned to work on a
limited basis on March 26, 1998, and the remaining underground work force, about
one-half  of the size of the  pre-shutdown  force,  returned  on a phased  basis
through April 1998. Substantial  development work is ongoing to prepare the mine
to operate  under the new operating  plan,  and  production  is increasing  each
month.

Domestic gold production  increased slightly to 182,600 ounces during the second
quarter of 1998 from  174,600  ounces  during the  second  quarter of 1997.  The
increase primarily is due to the commencement of production at the new Ruby Hill
mine in Nevada,  offset by the temporary suspension of mining in the underground
operations at the Homestake mine. The Ruby Hill mine, which commenced commercial
production  effective January 1, 1998,  produced 30,400 ounces of gold at a cash
cost $123 per ounce  during the second  quarter of 1998.  The mine  continues to
exceed initial projections due to processing 12% more tons than planned and to a
higher gold recovery rate. At the Homestake  mine,  gold  production  during the
second  quarter of 1998  declined  by 28% to 70,400  ounces  compared  to 97,900
ounces during the second  quarter of 1997.  During the temporary  shut down, the
mill processed an increased  volume of lower-grade  ore from the lower-cost Open
Cut operations.  The increased volume of Open Cut ore reduced the mine's average
cash costs to $256 per ounce during the 1998 second  quarter from $330 per ounce
in the 1997 second  quarter.  At the McLaughlin  mine,  production  increased to
34,800  ounces  during the second  quarter of 1998 from 30,900 ounces during the
prior year's  second  quarter due to a  combination  of higher ore grades and an
increase in mill  throughput.  These factors  together with lower unit operating
and maintenance costs resulted in a significant  reduction in cash costs to $201
per ounce in 1998 from $254 per ounce in the second quarter of 1997. Homestake's
share of  production  at the Round  Mountain  mine  increased by 4,000 ounces to
36,500  ounces  during the second  quarter of 1998 from 32,500  ounces  produced
during the second  quarter of 1997.  The higher  production  primarily is due to
production from the new 8,000  tons-per-day  mill which was commissioned in late
1997. The new mill, which was constructed to process higher-grade ores, produced
6,200  ounces  (Homestake's  share)  during  the  quarter.  Cash  costs at Round
Mountain  declined  to $194 per ounce in the 1998 second  quarter  from $204 per
ounce in the 1997 second  quarter due to cost  savings  associated  with the new
mining plan  instituted in 1997. The new pit design has led to a lower stripping
ratio  that has  reduced  unit  costs and  capital  requirements,  substantially
improving earnings and cash flow over the life of the operation.

Total  foreign  gold  production  during the three  months  ended June 30,  1998
increased 21,900 ounces or 5% to 474,000  equivalent  ounces over the comparable
period for the prior year.  This  increase in  production  primarily is due to a
significant  increase in  production  at the Eskay Creek and  Williams  mines in
Canada and at the Lawlers mine in Australia.

Production at the Eskay Creek mine increased to 130,000 gold  equivalent  ounces
during the second quarter of 1998 from 100,900 gold equivalent ounces during the
second  quarter of 1997.  Although  the gold grade has been  consistently  above
projections  this year,  most of the production  increase can be attributed to a
lower  silver/gold  equivalency  ratio and the  excellent  performance  from the
gravity/flotation  mill installed in December 1997 to process  lower-grade  ore.
Cash costs (including  third-party smelter costs) were $134 per equivalent ounce
in the 1998 second  quarter  compared to $157 per  equivalent  ounce in the 1997
second quarter.  The Williams mine produced 50,900 ounces of gold at a cash cost
of $209 per ounce during the second  quarter of 1998  compared to 42,800  ounces
produced at a cash cost of $272 per ounce during the second quarter of 1997. The
higher production was attributable to an increase in tons milled and an


                                       13
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES


increase in the ore grade.  The  significant  decline in cash cost resulted from
increased   production,   improved  ground   conditions  and  lower  underground
development  costs. The David Bell mine produced 22,900 ounces at a cash cost of
$180 per ounce  during the  second  quarter of 1998  compared  to 20,800  ounces
produced at a cash cost of $213 per ounce during the second  quarter of 1997 due
to an increase in tons milled.  Homestake's share of production at the Snip mine
decreased to 26,800 ounces in the 1998 second  quarter from 31,300 ounces in the
1997 second quarter. The decline in production reflect the mining of lower-grade
ore. However, costs still declined as the impact of the lower ore grade was more
than offset by lower mining and service costs.  Overall Canadian operations cash
cost also  benefited  from a four percent  decline in the average  Canadian/U.S.
dollar exchange rate between the second quarters of 1998 and 1997.

HGAL's share of production  at the  Kalgoorlie  operations in Western  Australia
totaled  104,800 ounces in the second quarter of 1998 compared to 107,000 ounces
in the second  quarter of 1997.  A small  decline  in mill  throughput  due to a
planned  relining  of the SAG mill and an  unscheduled  shutdown  to inspect and
repair  damage to the mill girth  gear was offset by the mining of  higher-grade
ore from the Super Pit.  Cash costs in 1998 declined to $219 per ounce from $279
per ounce in 1997,  attributable  to lower costs and the decline in value of the
Australian dollar in relation to the U.S. dollar.

In the second quarter of 1998,  gold  production at the Plutonic mine dropped to
55,700  ounces at a cash cost of $247 per ounce  compared to 73,900  ounces at a
cash cost of $218 per ounce in the prior  year's  second  quarter.  Plutonic  is
mainly an underground operation as the open pit was mined out in 1997. Mill feed
from underground  operations was somewhat below expectations in the last quarter
as lode  structures in the NW Extension  were flatter and less  continuous  than
anticipated, making mining more difficult. However, current drilling already has
succeeded in defining  higher-grade  lode  structures in areas where  production
will commence in the third quarter.

Gold production for the latest quarter at the Darlot/Centenary  mine declined to
14,700  ounces in 1998 from 16,100 ounces in the 1997 quarter as ore was sourced
predominantly  from the  lower-grade  Darlot orebody.  Consequently,  cash costs
increased to $289 per ounce in 1998 from $271 per ounce in 1997.  Development of
the low-cost, high-grade Centenary deposit has been delayed somewhat as a result
of a change in mining contractors. Initial production from the Centenary deposit
is expected to take place by the end of the third quarter.

For the second  quarter of 1998,  production  from the Lawlers mine increased to
30,800 ounces compared to 18,500 ounces in the comparable period of the previous
year. Ore grades,  particularly from the New Holland South underground zone, and
the  recovery  rate  from  the  gravity  circuit  both  have  been  higher  than
anticipated. As a result, cash costs declined to $203 per ounce compared to $232
per ounce in 1997.  Work has commenced on a second  decline to access the deeper
lode structures of the New Holland South zone.

Homestake's  80% share of gold  production  from the Mt Morgans  mine was 15,100
ounces in the latest quarter at a cash cost of $222 per ounce compared to 16,500
ounces at a cost of $411 per ounce in the  comparable  1997 quarter.  Cash costs
declined  substantially  despite  the  drop in  production  due to  higher  than
expected ore grades and recoveries  from  stockpiled ore. The Mt Morgans mine is
scheduled to cease  operations in September 1998.  However,  recent  exploration
results have been very promising,  and could result in extending the life of the
mine if additional ore is located.

Overall  Australian  operations  cash  costs per ounce  also  benefited  from an
eighteen  percent  decline in the average  Australian/U.S.  dollar exchange rate
between the second quarters of 1998 and 1997.

                                       14
<PAGE>
                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES


At the La Falda mine in Chile, second quarter 1998 gold production  increased to
12,700  ounces  compared  to  8,300  ounces  in  1997  primarily  due to  higher
recoveries.  Cash  costs  declined  to $191 per ounce  from $203 per  ounce.  At
present,  oxide ore is being mined and heap  leached  while  metallurgical  work
continues on the much larger,  predominantly unoxidized Jeronimo orebody. Recent
tests of bio-oxidation techniques have been encouraging and testing to determine
the best method for  extracting  gold from the ore will  continue.  A decline is
being  developed to access the deeper sulfide ore so that a large sample of this
ore can be obtained for metallurgical testing.

The Company's  consolidated  total cash costs per ounce  decreased 26 percent to
$201 in the 1998 second  quarter  compared  to $254 in the 1997 second  quarter.
Approximately  $21 per  ounce  of this  decline  is  attributable  to the  lower
Australian and Canadian dollar exchange rates.

For the six months ended June 30, 1998, the Company recorded a net loss of $37.5
million or $0.18 per share  compared to a net loss of $16.6 million or $0.08 per
share  in  1997.  The net loss for the  first  half of the 1998  includes  $17.7
million ($20.7 million  pretax) or $0.08 per share for business  combination and
integration  costs related to the  acquisition  of Plutonic,  $5.9 million ($8.9
million  pretax)  or $0.03  per share in  restructuring  costs  relating  to the
Homestake  mine,  and $2.6 million ($2.9 million  pretax) or $0.02 per share for
write-downs of exploration properties.  The net loss for the first six months of
1997 includes gains of $47.2 million  ($62.9 million  pretax) or $0.22 per share
from the break-up fee received  from Santa Fe Pacific Gold  Corporation  ("Santa
Fe") upon  termination  of Homestake's  merger  agreement with Santa Fe and $8.1
million ($13.5 million pretax) or $0.04 per share from the sale of joint venture
interests in two mining properties in the Northwest  Territories of Canada,  and
an  after-tax  loss of $50  million  ($65.1  million  pretax) or $0.24 per share
primarily  related to the write-downs at the Mt Morgans mine and the Meekatharra
exploration property.

Year-to-date  revenues from gold and ore sales  totaled $405 million  during the
first six months of 1998 compared to $442.2  million during the first six months
of 1997, reflecting significantly lower average realized prices partially offset
by increased sales volumes.  During the first half of 1998, 1,332,500 equivalent
ounces of gold were sold at an average realized price of $316 per ounce compared
to sales of  1,231,900  equivalent  ounces of gold sold at an  average  realized
price of $364 per ounce  during  the first  half of 1997.  The  increased  sales
volumes primarily are due to increases in production.

The Company's  share of revenues from the Main Pass 299 operation in the Gulf of
Mexico  declined  to $5.7  million  during the second  quarter of 1998 from $6.8
million in the second  quarter of 1997,  and  operating  losses  were $1 million
during the second  quarter  compared to losses of $0.4  million  during the 1997
second  quarter.  Sulfur  sales  increased  to 77,900  long tons during the 1998
second  quarter from 76,700 long tons during the 1997 second  quarter.  However,
the average realized sulfur price declined to $58 per ton during the 1998 second
quarter  compared to $60 per ton during the second quarter of the previous year.
Oil sales also declined due to a 29% decrease in  production  and a 31% decrease
in the average oil price per barrel.  Year-to-date  1998  revenues from the Main
Pass 299 operations  decreased to $11.8 million  compared to  year-to-date  1997
revenues of $13.8 million,  and  year-to-date  1998  operating  losses were $1.7
million compared to losses of $1 million for the year-to-date  1997 period.  The
1998  results  reflect  lower  oil  prices  and sales  volumes,  offset by lower
depreciation  charges following the write down of the sulfur assets at September
30, 1997.

Homestake's  gold hedging policy provides for the use of forward sales contracts
for up to  30% of  each  of  the  following  ten  year's  expected  annual  gold
production  at  prices  in excess of  certain  targeted  prices,  and the use of
combinations of put and call option contracts to establish  minimum floor prices
while allowing  participation in future increases in the price of gold. In 1997,
Homestake  entered into a series of put and call options  which  provide a floor
price of $325 per

                                       15
<PAGE>
                   HOMESTAKE MINING COMPANY AND SUBSIDIARIES


ounce  for  900,000   ounces  of  1998   production   while  allowing  for  full
participation  in any  increase in the price of gold above $336 per ounce.  Gold
sales for the three and six months  ended June 30,  1998  includes  225,000  and
450,000 ounces,  respectively,  at an average price of $325 per ounce under this
program.  At June 30, 1998 the Company  owned put options for 450,000  ounces of
gold exercisable  during 1998 at a price of $325 per ounce. The Company also had
written call options  outstanding for 450,000 ounces of gold exercisable  during
1998 at a price of $325 per ounce and owned call  options for 450,000  ounces of
gold exercisable during 1998 at a price of $336 per ounce.

During the three and six months  ended June 30,  1998 the Company  delivered  or
financially  settled 55,900 and 178,900 ounces of its Australian gold production
into Australian dollar  denominated  forward gold contracts at average prices of
$372 and $339 per ounce,  respectively.  During  the three and six months  ended
June 30, 1997 the Company delivered 124,300 and 265,150 ounces of its Australian
gold  production into Australian  dollar  denominated  forward gold contracts at
average prices for both periods of $429 per ounce. During June 1998, the Company
closed  out  and  financially  settled  one  million  ounces  of its  Australian
dollar-denominated  forward gold contracts.  The gain of $5 million  realized on
this  arrangement  was deferred and will be recorded in income as the originally
designated  production is delivered.  At June 30, 1998 the Company had remaining
commitments  for  210,000  ounces of its future  Australian  dollar  denominated
forward gold contracts at an average price of $320 (A$526) per ounce.

During the three and six months  ended June 30,  1998 the Company  delivered  or
financially  settled  30,000  and  60,000  ounces  of its  North  American  gold
production  at  average  prices of $398 and $396 per  ounce,  respectively,  and
during the three and six months  ended June 30,  1997 the Company  delivered  or
financially  settled  30,000  and  60,000  ounces  of its  North  American  gold
production at average prices of $383 and $381 per ounce,  respectively.  At June
30, 1998 the Company had committed  520,000  ounces of its future North American
gold  production  for sale through the year 2003 at an average price of $438 per
ounce under  forward  sales  contracts.  The Company  also owned put options for
30,000 ounces of gold  exercisable  during 2000 at a price of $350 per ounce and
had written  call  options  outstanding  for 15,000  ounces of gold  exercisable
during 2000 at an average price of $395 per ounce.

The Company's hedging activities increased revenues by approximately $13 million
and $27 million in the three and six months ended June 30,  1998,  respectively,
and by  approximately  $14  million  and $29 million in the three and six months
ended  June 30,  1997,  respectively.  The  estimated  liquidation  value of the
Company's hedging position at June 30, 1998 was approximately $56.9 million.

In February 1998,  Prime adopted a gold and silver hedging policy which provides
for the use of forward  sales  contracts  for up to 40% of each of the following
five year's  expected  annual gold and silver  production at prices in excess of
certain  targeted prices.  At June 30, 1998 Prime had forward sales  outstanding
for  approximately  7.2 million  ounces of silver during the period 1999 through
2001 at an average price of $6.28 per ounce.

A  significant  portion of the  Company's  operating  expenses  is  incurred  in
Australian and Canadian currencies.  The Company's  profitability is impacted by
fluctuations in these  currencies'  exchange rates relative to the United States
dollar. Under the Company's foreign currency protection program, the Company has
entered  into a series of foreign  currency  option  contracts  which  establish
trading  ranges  within  which the United  States  dollar may be  exchanged  for
Australian and Canadian dollars. At June 30, 1998 the Company had a recorded net
unrealized loss of $28.9 million on open contracts under this program.

Other income for the six months ended June 30, 1998  includes  foreign  currency
exchange  losses of $25.4 million and gains on sales of Rabbi Trust  investments
of $4.3 million. Other


                                       16
<PAGE>
                  HOMESTAKE MINING COMPANY AND SUBSIDIARIES


income in 1997  includes a $13.5  million  gain on sale of the George  Lake/Back
River joint venture interests and a net foreign currency exchange losses of $6.9
million.

Depreciation,  depletion and amortization  expense increased to $37.4 million in
the second  quarter  of 1998  compared  to $34  million  during the 1997  second
quarter  reflecting the higher gold production,  offset by reduced  depreciation
charges following the asset write-downs during 1997.

Exploration  expense for the three and six months  ended June 30, 1998 was $11.5
million and $21.8  million,  respectively,  compared to $18.1  million and $30.1
million of the respective  three and six months periods ended June 30, 1997. The
Company  expects to spend  approximately  $58 million during 1998 on exploration
projects,  of which 50% is  expected to be spent in  Australia  and 30% in North
America.

Income and mining tax  expense  for the six months  ended June 30, 1998 was $2.3
million  compared  to $31 million for the six months  ended June 30,  1997.  The
decrease in tax  expense  primarily  reflects  taxes of $15.7  million  provided
during 1997 on the  break-up  fee  received  from Santa Fe upon  termination  of
Homestake's  merger  agreement  with Santa Fe.  For the first half of 1998,  the
consolidated effective tax rate was a negative 8%, reflecting the geographic mix
of pretax income and losses.  The tax benefits related to losses incurred in the
United States and Australia were more than offset by a tax expense recorded with
respect to the Canadian earnings.  The Company's  consolidated  effective income
and mining tax rate will fluctuate  depending on the  geographical mix of pretax
income.

Minority interests in the income of consolidated  subsidiaries  increased during
the first six months of 1998 to $5.6 million from $4.9 million  during the first
six months of 1997. The increase in minority interests primarily is attributable
to higher  earnings  at the Eskay  Creek mine which is owned by Prime  Resources
Group Inc., a 50.6%-owned subsidiary of the Company.

The following chart details Homestake's gold production and total cash costs per
ounce by location, and consolidated revenue and production costs per ounce.

                                       17
<PAGE>
                  HOMESTAKE MINING COMPANY AND SUBSIDIARIES

<TABLE>
<CAPTION>

                                                                               Production
                                                                         (Ounces in thousands)
                                                         Three Months Ended                     Six Months Ended
                                                               June 30,                              June 30,
Mine (Percentage interest)                              1998              1997                1998              1997
--------------------------                      --------------------------------      --------------------------------

<S>                                                       <C>               <C>                <C>               <C>  
Homestake (100)                                           70.4              97.9               146.4             204.3
Ruby Hill (100)                                           30.4              -                   61.0              -
McLaughlin (100)                                          34.8              30.9                64.9              62.5
Round Mountain (25)                                       36.5              32.5                69.5              60.6
Pinson (50)                                                4.5               6.2                10.9              12.6
Marigold (33)                                              6.0               7.1                12.2              14.3
                                                 --------------    --------------      --------------    --------------
    Total United States                                  182.6             174.6               364.9             354.3

Eskay Creek (100) (1)                                    130.0             100.9               271.1             195.5
Williams (50)                                             50.9              42.8                95.6              94.2
David Bell (50)                                           22.9              20.8                41.1              43.8
Quarter Claim (25)                                         2.8               2.8                 5.6               5.6
Snip (100) (2)                                            26.8              31.3                50.5              59.5
                                                 --------------    --------------      --------------    --------------
     Total Canada                                        233.4             198.6               463.9             398.6

Kalgoorlie (50)                                          104.8             107.0               198.9             215.3
Plutonic (100)                                            55.7              73.9               112.0             135.0
Darlot/Centenary (100)                                    14.7              16.1                30.3              29.5
Lawlers (100)                                             30.8              18.5                62.4              28.2
Mt Morgans (80)                                           15.1              16.5                34.6              36.6
Peak Hill (67)                                             6.8               9.0                12.6              18.4
                                                 --------------    --------------      --------------    --------------
     Total Australia                                     227.9             241.0               450.8             463.0

Agua de la Falda, Chile (100)                             12.7               8.3                23.7               8.3

                                                 --------------    --------------      --------------------------------
Total Production (4)                                     656.6             626.7             1,303.3           1,237.2
Less Minority Interests                                  (83.7)            (69.5)             (170.5)           (130.1)
                                                 --------------    --------------      --------------    --------------
Homestake's Share                                        572.9             557.2             1,132.8           1,107.1
                                                 ==============    ==============      ==============    ==============


                                       18
<PAGE>
                 HOMESTAKE MINING COMPANY AND SUBSIDIARIES

<CAPTION>

                                                                         Total Cash Costs
                                                                        (Dollars per ounce)

                                                         Three Months Ended                     Six Months Ended
                                                               June 30,                              June 30,
Mine (Percentage interest)                              1998              1997                1998              1997
--------------------------                          --------------------------------      --------------------------------

<S>                                                    <C>                <C>                 <C>               <C>    
United States
     Homestake (100)                                    $256              $330                $250              $323
     Ruby Hill (100)                                     123                -                  126                -
     McLaughlin (100)                                    201               254                 216               249
     Round Mountain (25)                                 194               204                 200               219
     Pinson (50)                                         447               372                 374               342
     Marigold (33)                                       261               257                 253               243

Canada
     Eskay Creek (100) (3)                               134               157                 127               161
     Williams (50)                                       209               272                 226               251
     David Bell (50)                                     180               213                 206               203
     Quarter Claim (25)                                  169               172                 170               174
     Snip (100) (3)                                      203               216                 213               210

Australia
     Kalgoorlie (50)                                     219               279                 239               276
     Plutonic (100)                                      247               218                 256               243
     Darlot/Centenary (100)                              289               271                 312               322
     Lawlers (100)                                       203               232                 195               238
     Mt Morgans (80)                                     222               411                 227               386
     Peak Hill (67)                                      253               251                 278               245

Chile
     Agua de la Falda (100)                              191               203                 202               203

Weighted Average                                        $201              $254                $207              $256


                                       19
<PAGE>
                HOMESTAKE MINING COMPANY AND SUBSIDIARIES

<CAPTION>
                                                          Three Months Ended                     Six Months Ended
                                                                June 30,                              June 30,
Per Ounce of Gold                                       1998              1997                1998              1997
                                               --------------------------------      --------------------------------
<S>                                                     <C>               <C>                 <C>               <C> 
Revenue                                                 $316              $362                $316              $364
                                               ================================      ================================

Per Ounce Costs
Cash Operating Costs (5)                                $197              $250                $204              $252
Other Cash Costs (6)                                       4                 4                   3                 4
                                               --------------------------------      --------------------------------
     Total Cash Costs                                    201               254                 207               256
Noncash Costs  (7)                                        56                58                  56                59
                                               --------------------------------      --------------------------------
     Total Production Costs                             $257              $312                $263              $315
                                               ================================      ================================

<FN>
(1)  Ounces  produced  are  expressed  on a gold  equivalent  basis.  Silver  is
     converted to gold equivalent  using the ratio of the silver market price to
     the gold market price.  Eskay Creek  production  includes 70,000 (56,500 in
     1997) ounces of gold and 3.1 million (3.2 million in 1997) ounces of silver
     contained in ore and  concentrates  sold to smelters in the second quarter,
     and 143,400  (110,900 in 1997) ounces of gold and 6.3 million (6 million in
     1997) ounces of silver contained in ore and  concentrates  sold to smelters
     in the year-to-date period.

(2)  Includes ounces of gold contained in dore and concentrates.

(3)  For  comparison  purposes,  total  cash costs per ounce  include  estimated
     third-party  costs  incurred  by  smelter  owners  and  others  to  produce
     marketable gold and silver.

(4)  Includes  4,200 ounces and 12,500  ounces of gold  produced at the Bellevue
     project  in  Western   Australia   during  the  1997  second   quarter  and
     year-to-date periods, respectively, and 500 ounces produced at the El Hueso
     mine in Chile during the 1997 year-to-date period.

(5)  Cash operating costs are costs directly related to the physical  activities
     of producing  gold;  includes  mining,  milling,  third-party  smelting and
     in-mine drilling expenditures that are related to production.

(6)  Other cash costs are costs that are not directly related to, but may
     result from, gold production;  includes production taxes and royalties.

(7)  Noncash  costs are costs that  typically are accounted for ratably over the
     life of an operation; includes depreciation,  depletion, accruals for final
     reclamation.  Noncash  costs do not include  amortization  of  additions to
     property   resulting  from  SFAS  109  deferred  tax  purchase   accounting
     adjustments,  as these additions did not involve any economic  resources of
     the Company.
</FN>
</TABLE>


LIQUIDITY AND CAPITAL RESOURCES

Cash provided by operations totaled $63.8 million during the first six months of
1998  compared  to $109.8  million  during  the first six  months of 1997.  Cash
provided by operations during the 1997 six-month period includes the termination
fee received from Santa Fe upon termination of Homestake's merger agreement with
Santa Fe,  partially  offset by $50  million in  payments  for income and mining
taxes,  primarily  payments made in the first quarter of 1997 related to Prime's
1996 taxable income. Payments for income and mining taxes of $11.4 million (net)
were made during the first six months of 1998.  Working capital at June 30, 1998
amounted to $308 million,  including  $284 million in cash and  equivalents  and
short-term investments.

                                       20
<PAGE>
                HOMESTAKE MINING COMPANY AND SUBSIDIARIES


Capital  additions  of $33.9  million  for the  first  half of 1998  compare  to
additions of $101.9 million for the first half of 1997. Capital additions during
1998 include $7 million and $6.7 million  primarily for underground  development
work at the Plutonic and Darlot/Centenary mines, respectively,  with the balance
primarily related to productivity improvement projects and sustaining capital at
the Company's other  operating  mines.  Capital  additions in 1997 include $30.9
million  for  construction  and  development  work at the Ruby Hill mine,  $22.7
million  primarily  for  underground  development  and  expenditures  for  a new
gas-fired power station at the Plutonic mine, $8.3 million at the Round Mountain
mine  primarily  for a new mill to process the  higher-grade  sulfide ore,  $8.1
million  for  development  work  at  the  Darlot/Centenary  mine,  $7.3  million
primarily for a tailings dam lift and improvements in the underground operations
at the Homestake mine, and $6.3 million at the Kalgoorlie  operations  primarily
for a decline from surface and a ventilation raise at the Mt. Charlotte mine.

On March 10, 1997 Santa Fe terminated its previously  announced merger agreement
with  Homestake and paid Homestake a $65 million  termination  fee. As a result,
the Company  recorded a pretax gain of $62.9 million  ($47.2 million after tax),
net of merger-related expenses of $2.1 million incurred in 1997.

In February  1997,  Homestake  completed the sale of its interests in the George
Lake and Back  River  joint  ventures  in  Canada to Kit  Resources  Corporation
("Kit") for $9.3 million in cash and 3.6 million shares of Kit common stock.  As
a result  of this  transaction,  the  Company  recorded  a pretax  gain of $13.5
million ($8.1 million after tax), which is included in other income.

In June  1998, Plutonic  repaid $8  million  of its debt  outstanding  under its
syndicated  credit  facility.  Borrowings  outstanding  at June 30, 1998 include
borrowings  of $95.5  million by  Plutonic  and $45.6  million by HGAL under the
Company's then-existing credit facilities.

In July 1998, the Company  entered into a new United  States/Canadian/Australian
cross-border credit facility providing a total availability of $430 million. The
new facility  replaces the Company's $275 million  cross-border  credit facility
and Plutonic's  A$400 million  syndicated  credit  facility,  both of which were
cancelled.  Borrowings  by Plutonic and HGAL under the prior  credit  facilities
were repaid using the new facility.  The new facility is available  through July
14, 2003 and provides for borrowings in United States,  Canadian,  or Australian
dollars, or gold, or a combination of these. Under the new facility, the Company
pays a  commitment  fee ranging  from 0.15% to 0.35% per annum,  depending  upon
rating agencies' ratings for the Company's senior debt, on the unused portion of
this facility.  The new credit  agreement  requires a minimum  consolidated  net
worth of $500  million.  Interest  on the HGAL and  Plutonic  Australian  dollar
borrowings  under the new  facility  is  payable  quarterly  and is based on the
Australian  Bank Bill Swap Rate plus a margin of up to 1.125%.  At July 31, 1998
the interest rate was 6.22%.

In February  1997,  the Company  paid a cash  dividend of 5 cents per share.  In
March 1997, the Company  reduced its annual  dividend rate to 10 cents per share
from 20 cents per share and declared a semi-annual dividend of 5 cents per share
which was paid in May 1997. In May 1998, the Company paid a semi-annual
dividend of 5 cents per share.

In April 1997, the Company filed with the  Securities and Exchange  Commission a
shelf  registration  statement for the potential sale of up to 20 million shares
of common  stock.  The proceeds  from any such  offering  would be available for
general corporate purposes, which could include capital expenditures,  repayment
of  debt  and  future  acquisitions,  which  have  the  potential  to add to the
Company's gold reserves and future gold production.

In February  1998, the Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting  Standards No. 132 ("SFAS 132"),  "Employers'
Disclosures about Pensions and Other Postretirement  Benefits." SFAS 132 revises
employers' disclosures about pension and

                                       21
<PAGE>
                HOMESTAKE MINING COMPANY AND SUBSIDIARIES


other  postretirement  benefit  plans.  It does not  change the  measurement  or
recognition of those plans.  SFAS 132 standardizes  the disclosure  requirements
for  pensions  and other  postretirement  benefits  to the  extent  practicable,
requires  additional  information on changes in the benefit obligations and fair
values of plan assets that will facilitate  financial  analysis,  and eliminates
certain  disclosures.  SFAS 132 will be effective  for the  Company's  financial
statements for the year ended December 31, 1998.

In June 1998, FASB issued  Statement of Financial  Accounting  Standards No. 133
("SFAS 133"),  "Accounting for Derivative  Instruments and Hedging  Activities."
SFAS 133 requires that all  derivatives  be recognized as assets or  liabilities
and be measured at fair value.  Gains or losses  resulting  from  changes in the
values of those  derivatives  would be accounted for depending on the use of the
derivatives and whether they qualify for hedge accounting as either a fair value
hedge or a cash flow hedge.  The key criterion for hedge  accounting is that the
hedging relationship must be highly effective in achieving offsetting changes in
fair value or cash flows of the hedging  instruments and the hedged items.  SFAS
133 is  effective  for fiscal  years  beginning  after June 15, 1999 but earlier
adoption is permitted.  The Company currently is evaluating the impact that this
requirement will have on reported  operating results and financial  position and
has not yet determined when SFAS 133 will be adopted.

Future  results  will be impacted by such  factors as the market  price of gold,
silver and sulfur,  the  Company's  ability to expand its ore  reserves  and the
fluctuations of foreign  currency  exchange rates. The Company believes that the
combination  of cash,  short-term  investments,  available  lines of credit  and
future cash flows from  operations  will be sufficient to meet normal  operating
requirements, planned capital expenditures, and anticipated dividends.

Prime Resources Group Inc.
On May 25,  1998  Homestake  announced  that it had  proposed  to the  Board  of
Directors of Prime,  the  acquisition by Homestake of the 49.4% of Prime held by
the public and not  already  owned by  Homestake.  Under the terms of the offer,
Prime  shareholders  would  receive  0.675  Homestake  common  shares  or  0.675
Homestake Canada Inc. ("HCI")  exchangeable  shares for each Prime share held by
them. Each HCI exchangeable share would be exchangeable for one Homestake common
share at any time at the option of the holder.

The  arrangement,  which is subject to the approval of the  shareholders of both
Homestake  and Prime,  would  result in the  issuance of a total of 25.4 million
Homestake  common and HCI  exchangeable  shares in exchange for the 37.6 million
Prime shares held by the minority shareholders of Prime.

                                       22
<PAGE>
                HOMESTAKE MINING COMPANY AND SUBSIDIARIES


Part II - OTHER INFORMATION

Item 4 - Submission of Matters to a Vote of Security Holders

1)   As previously  reported on the Registrant's Form 8-K filed on May 12, 1998,
     on April 30,  1998  Registrant  consummated  the  acquisition  of  Plutonic
     Resources Limited ("Plutonic"), a publicly-traded Australian gold producer,
     by an exchange of common stock for common stock.

     Shareholders  of  Registrant  voted  on and  approved  the  acquisition  of
     Plutonic  at a Special  Meeting  of  Shareholders  held on April 29,  1998.
     Shareholder votes were as follows:

           Votes For                    Votes Against            Abstentions
           ---------                    -------------            -----------
          79,505,401                      1,040,836                603,751


2)   At the Annual Meeting of Shareholders  held on July 24, 1998,  shareholders
     voted on and  approved (i) the election of four Class II directors to serve
     until   the   2001   Annual   Meeting,   and  (ii)   the   appointment   of
     PricewaterhouseCoopers L.L.P. as independent auditors for 1998. Shareholder
     votes were as follows:
<TABLE>
<CAPTION>

     (i)  Election of four Class II Directors:            Votes For           Votes Withheld
     ----------------------------------------             ---------           --------------
              <S>                                        <C>                     <C>      
              Paul McClintock                            127,697,608             1,127,052
              John Neerhout, Jr.                         127,584,370             1,240,290
              Stuart Peeler                              127,631,766             1,192,894
              Jack Thompson                              127,667,534             1,157,126
</TABLE>

          In addition to the aforementioned  directors,  the following directors
          continued in office: M. Norman Anderson, Robert H. Clark, Jr., Douglas
          W.  Fuerstenau,  Jeffrey L. Zelms,  Richard R. Burt, G. Robert Durham,
          Peter J. Neff and Carol A. Rae.


          On July 24,  1998 Harry M. Conger and Henry G.  Grundstedt  retired as
          directors.  The Board of  Directors  has elected  Jack E.  Thompson to
          replace Mr. Conger as Chairman of the Board.  Mr. Thompson will retain
          his  responsibilities  as President and Chief Executive Officer of the
          Company.

     (ii) Approval of PricewaterhouseCoopers L.L.P. as independent auditors:

           Votes For                   Votes Against                  Abstain
           ---------                   -------------                  --------
          127,844,464                    538,992                      441,204


Item 5. - Other Information

(a)       Amendment to Bylaws

          On July 24,  1998 the  Bylaws  were  amended  to reduce  the number of
          directors from 13 to 12. A copy of the Bylaws,  as amended is attached
          as Exhibit 3.4.

                                       23
<PAGE>
                HOMESTAKE MINING COMPANY AND SUBSIDIARIES



(b)      CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
         OF 1995

         Certain statements  contained in this Form 10-Q that are not statements
         of historical facts are "forward looking statements" within the meaning
         of  the  Private  Securities   Litigation  Reform  Act  of  1995.  Such
         statements are based on beliefs of  management,  as well as assumptions
         made by and  information  currently  available to  management.  Forward
         looking  statements  include  those  preceded  by the words  "believe,"
         "estimate,"  "expect," "intend," "will," and similar  expressions,  and
         include  estimates  of future  production,  costs per  ounce,  dates of
         construction completion,  costs of capital projects and commencement of
         operations.   Forward   looking   statements   are  subject  to  risks,
         uncertainties  and other  factors  that could cause  actual  results to
         differ  materially from expected  results.  Some important  factors and
         assumptions  that could cause actual results to differ  materially from
         expected results are discussed below. Those listed are not exclusive.

         Estimates of future  production for  particular  properties and for the
         Company as a whole are  derived  from  annual mine plans that have been
         developed based on mining experience,  reserve  estimates,  assumptions
         regarding ground conditions and physical  characteristics  of ore (such
         as hardness  and  metallurgical  characteristics),  expected  rates and
         costs  of  production,   and  estimated  future  sales  prices.  Actual
         production  may vary for a  variety  of  reasons,  such as the  factors
         described  above,  ore  mined  varying  from  estimates  of  grade  and
         metallurgical and other  characteristics,  mining dilution,  actions by
         labor,  and government  imposed  restrictions.  Estimates of production
         from  properties  and  facilities  not yet in  production  are based on
         similar  factors but there is a greater  likelihood that actual results
         will vary from estimates due to a lack of actual experience.  Cash cost
         estimates  are based on such  things as past  experience,  reserve  and
         production estimates, anticipated mining conditions, estimated costs of
         materials,  supplies  and  utilities,  and  estimated  exchange  rates.
         Noncash cost  estimates  are based on total  capital  costs and reserve
         estimates,  change  based on actual  amounts  of  unamortized  capital,
         changes  in  reserve  estimates,  and  changes  in  estimates  of final
         reclamation.  Estimates of future  capital costs are based on a variety
         of factors and include past operating  experience,  estimated levels of
         future  production,  estimates by and  contract  terms with third party
         suppliers,  expectations  as  to  government  and  legal  requirements,
         feasibility reports by Company personnel and outside  consultants,  and
         other  factors.  Capital cost estimates for new projects are subject to
         greater  uncertainties  than  additional  capital  costs  for  existing
         operations.  Estimated time for completion of capital projects is based
         on such  factors as the  Company's  experience  in  completing  capital
         projects,   and   estimates   provided  by  and  contract   terms  with
         contractors,  engineers,  suppliers  and others  involved in design and
         construction of projects.  Estimates reflect  assumptions about factors
         beyond the Company's control, such as the time government agencies take
         in processing  applications,  issuing permits and otherwise  completing
         processes  required under applicable laws and regulations.  Actual time
         to completion can vary significantly from estimates.

         See the  Company's  Form 10-K  Report for the year ended  December  31,
         1997, Part IV, "RISK FACTORS" and "CAUTIONARY  STATEMENTS,"  for a more
         detailed  discussion  of  factors  that may impact on  expected  future
         results.




                                       24
<PAGE>
                HOMESTAKE MINING COMPANY AND SUBSIDIARIES


Item 6.
<TABLE>
<CAPTION>

(a)   Exhibits                                                                     Method of Filing
      --------                                                                     ----------------
         <S>    <C>                                                                <C>                                      
         3.4    Bylaws, as amended through July 24, 1998                           Filed herewith
                                                                                   electronically

         10.1   Amended and Restated Credit Agreement, dated  as of                Filed herewith
                July 14, 1998                                                      electronically

         11     Computation of Earnings Per Share                                  Filed herewith
                                                                                   electronically

         27.1   Financial Data Schedule - June 30, 1998                            Filed herewith
                                                                                   electronically

         27.2   Financial Data Schedule - March 31, 1998                           Filed herewith
                (restated for pooling of interests)                                electronically

         27.3   Financial Data Schedule - periods ended March 31, June 30          Filed herewith
                and September 30, 1997 (restated for pooling of interests)         electronically

</TABLE>


(b)      Reports on Form 8-K

         Three  reports on Form 8-K were filed during the quarter ended June 30,
         1998.

         The  report on Form 8-K dated May 11,  1998 was  submitted  in order to
         file a press release  announcing  that the Registrant had completed the
         acquisition of Plutonic Resources Limited.

         The  report on Form 8-K dated  June 5, 1998 was  submitted  in order to
         file the following:  (a) a press release  announcing  the  Registrant's
         offer to acquire the Prime Resources Group Inc. minority  interests and
         (b) the results of the special  meeting  regarding the  acquisition  of
         Plutonic.

         The report on Form 8-K dated June 22,  1998 was  submitted  in order to
         file the following:  (a) a press release  reporting the interim results
         following  the  acquisition  of  Plutonic  and  (b)  the   consolidated
         financial  statements  and  supplementary  data  (restated  to  include
         Plutonic) for the years ended December 31, 1997, 1996 and 1995.




                                       25
<PAGE>
                HOMESTAKE MINING COMPANY AND SUBSIDIARIES



                                   SIGNATURES


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




                                                 HOMESTAKE MINING COMPANY




Date:  August 13, 1998                         By: /s/ Gene G. Elam
       ---------------                            ----------------
                                                  Gene G. Elam
                                                  Vice President, Finance and
                                                  Chief Financial Officer

                                       26