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 March 31, 1999



( )      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 May 1, 1999 was 
260,195,700.*

*    Includes  7,366,000  Homestake Canada Inc.  exchangeable  shares that may
     be exchanged at any time for Homestake common stock on a one-for-one basis.



<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>
                                                                                      March 31,                  December 31,
                                                                                        1999                        1998
                                                                                  ---------------             ----------------
<S>                                                                               <C>                          <C>           
ASSETS
Current Assets
    Cash and equivalents                                                          $      141,000               $      145,069
    Short-term investments                                                               126,275                      154,346
    Receivables                                                                           34,787                       45,891
    Inventories:
       Finished products                                                                  15,977                       13,312
       Ore and in process                                                                 45,052                       39,465
       Supplies                                                                           24,806                       26,129
    Deferred income and mining taxes                                                      20,486                       22,792
    Other                                                                                  5,167                        5,102
                                                                                  ---------------             ----------------
       Total current assets                                                              413,550                      452,106
                                                                                  ---------------             ----------------

Property, Plant and Equipment - at cost                                                2,565,569                    2,523,717
    Accumulated depreciation, depletion and amortization                              (1,464,178)                  (1,422,853)
                                                                                  ---------------             ----------------
       Property, plant and equipment - net                                             1,101,391                    1,100,864
                                                                                  ---------------             ----------------

Investments and Other Assets
    Noncurrent investments                                                                12,650                       12,945
    Other assets                                                                          70,267                       81,616
                                                                                  ---------------             ----------------
       Total investments and other assets                                                 82,917                       94,561
                                                                                  ---------------             ----------------
Total Assets                                                                      $    1,597,858               $    1,647,531
                                                                                  ===============             ================

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
    Accounts payable                                                              $       31,982               $       42,580
    Accrued liabilities:
       Payroll and other compensation                                                     30,160                       31,587
       Reclamation and closure costs                                                      22,740                       23,206
       Unrealized loss on foreign currency exchange contracts                             12,083                       24,003
       Other                                                                              40,571                       23,192
    Income and other taxes payable                                                         5,130                        3,151
                                                                                  ---------------             ----------------
       Total current liabilities                                                         142,666                      147,719
                                                                                  ---------------             ----------------

Long-term Liabilities
    Long-term debt                                                                       303,955                      357,410
    Other long-term obligations                                                          170,683                      168,178
                                                                                  ---------------             ----------------
       Total long-term liabilities                                                       474,638                      525,588
                                                                                  ---------------             ----------------

Deferred Income and Mining Taxes                                                         235,277                      230,567

Minority Interests in Consolidated Subsidiaries                                            7,434                        7,825

Shareholders' Equity
    Capital stock, $1 par value per share:
       Authorized - Preferred: 10,000 shares; no shares outstanding
                  - Common: 450,000 shares
       Outstanding - HCI exchangeable shares: 1999 - 8,087; 1998 - 11,139
                   - Common: 1999 - 231,121; 1998 - 228,012                              231,121                      228,012
    Other shareholders' equity                                                           506,722                      507,820
                                                                                  ---------------             ----------------
       Total shareholders' equity                                                        737,843                      735,832
                                                                                  ---------------             ----------------
Total Liabilities and Shareholders' Equity                                        $    1,597,858               $    1,647,531
                                                                                  ===============             ================

</TABLE>

See notes to condensed consolidated financial statements.

                                       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 March 31,
                                                                                1999                          1998
                                                                       -----------------              ----------------


<S>                                                                      <C>                            <C>          
Revenues
      Gold and ore sales                                                 $      159,227                 $     194,339
      Sulfur and oil sales                                                        3,851                         6,133
      Interest income                                                             4,119                         4,259
      Other income                                                               11,336                        11,486
                                                                       -----------------              ----------------
                                                                                178,533                       216,217
                                                                       -----------------              ----------------
Costs and Expenses
      Production costs                                                          108,787                       135,557
      Depreciation, depletion and amortization                                   31,662                        36,090
      Administrative and general expense                                         10,981                        12,565
      Exploration expense                                                         7,737                        10,297
      Interest expense                                                            4,545                         5,112
      Business combination expenses                                                   -                         2,776
      Write-downs and other unusual charges                                           -                         8,879
      Other expense                                                                 586                           379
                                                                       -----------------              ----------------
                                                                                164,298                       211,655
                                                                       -----------------              ----------------

Income Before Taxes and Minority Interests                                       14,235                         4,562
Income and Mining Taxes                                                         (12,472)                       (7,220)
Minority Interests                                                                  435                        (3,928)
                                                                       -----------------              ----------------

Net Income (Loss)                                                        $        2,198                 $      (6,586)
                                                                       =================              ================



Net Income (Loss) Per Share - Basic and Diluted                          $         0.01                 $       (0.03)
                                                                       =================              ================

Average Shares Used in the Computation                                          239,179                       210,659
                                                                       =================              ================

Dividends Paid Per Common Share                                          $            -                 $           -
                                                                       =================              ================
</TABLE>

See notes to condensed consolidated financial statements.

                                       3

<PAGE>

                    HOMESTAKE MINING COMPANY AND SUBSIDIARIES



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

                                                                                        Three Months Ended March 31,
                                                                                        1999                        1998
                                                                                 ----------------            ---------------

<S>                                                                               <C>                         <C>           
Cash Flows from Operations
     Net income (loss)                                                            $        2,198              $      (6,586)
     Reconciliation to net cash provided by operations:
       Depreciation, depletion and amortization                                           31,662                     36,090
       Gains on asset disposals                                                             (232)                      (192)
       Deferred taxes, minority interests and other                                        4,882                    (10,284)
       Effect of changes in operating working capital items                              (11,961)                     3,300
                                                                                 ----------------            ---------------
     Net cash provided by operations                                                      26,549                     22,328
                                                                                 ----------------            ---------------

Investment Activities
     Decrease in short-term investments                                                   29,103                     21,637
     Additions to property, plant and equipment                                          (13,255)                   (17,974)
     Proceeds from asset sales                                                               329                        678
     Decrease (increase) in restricted cash                                               11,836                       (212)
     Other                                                                                     -                       (982)
                                                                                 ----------------            ---------------
     Net cash provided by investment activities                                           28,013                      3,147
                                                                                 ----------------            ---------------

Financing Activities
     Debt repayments                                                                     (58,000)                         -
     Other                                                                                     -                      3,343
                                                                                 ----------------            ---------------
Net cash provided by (used in) financing activities                                      (58,000)                     3,343
                                                                                 ----------------            ---------------

Effect of Exchange Rate Changes on Cash and Equivalents                                     (631)                       318
                                                                                 ----------------            ---------------

Net Increase (Decrease) in Cash and Equivalents                                           (4,069)                    29,136

Cash and Equivalents, January 1                                                          145,069                    124,083
                                                                                 ----------------            ---------------

Cash and Equivalents, March 31                                                    $      141,000              $     153,219
                                                                                 ================            ===============


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



                                      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, in the Company's
     Annual Report on Form 10-K for the year ended December 31, 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 4,
     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.   Other income for the three months ended March 31 is as follows 
     (in millions):
<TABLE>
<CAPTION>

                                                                    Three Months Ended
                                                                         March 31,
                                                            ------------------------------------
                                                                1999                   1998
                                                            --------------         -------------

<S>                                                             <C>                   <C> 
Gains on asset disposals                                        $0.2                  $0.2
Gain on sales of Rabbi Trust investments                           -                   4.0
Royalty income                                                   0.6                   0.6
Foreign currency contract gains                                  7.9                   4.1
Foreign currency exchange gains on inter-
     company advances                                            1.3                   0.9
Other foreign currency gains                                     0.2                   0.1
Other                                                            1.1                   1.6
                                                            --------------         -------------
                                                               $11.3                 $11.5
                                                            ==============         =============
</TABLE>

3.   In January  1998,  the Company  commenced a  restructuring  of  underground
     operations at the Homestake mine, including a significant reduction in that
     mine's workforce. As a result of the restructuring, in the first quarter of
     1998 the Company recorded severance and other costs of $8.9 million, net of
     pension and other  postretirement  curtailment and settlement gains of $9.3
     million.

4.   On  April  30,  1998  Homestake   acquired   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 based on an exchange  ratio of 0.34  Homestake  common
     shares for each Plutonic share. The business  combination with Plutonic was
     accounted  for as a pooling  of  interests  and,  accordingly,  Homestake's
     consolidated   financial  statements  include  Plutonic  for  all  periods.
     Business  combination  expenses of $2.8 million related to this acquisition
     were recorded in the three months ended March 31, 1998.


                                       5
<PAGE>

                   Homestake Mining Company and Subsidiaries

5.   Long-term debt is as follows:
<TABLE>
<CAPTION>

                                                                       March 31,                 December 31,
                                                                         1999                        1998
                                                                    ---------------------------------------------
<S>                                                                       <C>                          <C>      
Convertible subordinated notes (due 2000)                                 $ 150,000                    $ 150,000
Pollution control bonds
    Lawrence County, South Dakota (due 2032)                                 38,000                       48,000
    State of California (due 2004)                                           17,000                       17,000
Cross-border credit facility (due 2003)                                      98,955                      142,410
                                                                    ---------------------------------------------
                                                                          $ 303,955                    $ 357,410
                                                                    =============================================
</TABLE>

     During the first  quarter of 1999,  the Company  repaid $48  million  (A$75
     million)  of  Australian  dollar-denominated  borrowings  under the  credit
     facility  from  existing  cash balances and $10 million of the South Dakota
     Waste  Disposal Bonds from funds held in trust.  Borrowings  outstanding at
     March 31, 1999 under the cross-border credit facility consist of Australian
     dollar-denominated borrowings of A$158 million.

6.   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 March  31,  1999 the  Company  had  foreign  currency  option  contracts
     outstanding as follows:
<TABLE>
<CAPTION>

                                              Expected Maturity or Transaction Date
                                                                                       Total or
US$ in millions                                 1999        2000          2001         Average
                                             ------------------------  ------------  -------------
<S>                                               <C>         <C>           <C>           <C>   
Canadian $ / US $ option contracts:
      US $ covered                                 $97.7       $93.4         $63.1         $254.2
      Average put exchange rate (1)                 0.69        0.69          0.66           0.68
      Average call exchange rate (2)                0.72        0.72          0.69           0.71

Australian $ / US $ option contracts:
      US $ covered                                 $69.2       $68.6         $23.0         $160.8
      Average put exchange rate (1)                 0.65        0.64          0.60           0.64
      Average call exchange rate (2)                0.68        0.67          0.63           0.67
<FN>
     (1) Assuming  exercise by the  counter-party  at the  expiration  date, the
         Company would exchange US dollars for Canadian or Australian dollars at
         the put  exchange  rate if the spot  exchange  rate was  below  the put
         exchange rate.

     (2) Assuming  exercise by the Company at the  expiration  date, the Company
         would  exchange US dollars for  Canadian or  Australian  dollars at the
         call  exchange  rate if the  spot  exchange  rate  was  above  the call
         exchange rate.
</FN>
</TABLE>

                                       6
<PAGE>

                   Homestake Mining Company and Subsidiaries


7.   The Company's operations are affected  significantly by the market price of
     gold. Gold prices are influenced by numerous factors over which the Company
     has  no  control,  including  expectations  with  respect  to the  rate  of
     inflation,  the relative  strength of the United  States dollar and certain
     other currencies,  interest rates, global or regional political or economic
     crises,  demand for gold for jewelry and industrial products,  and sales by
     holders and  producers  of gold in response to these  factors.  Homestake's
     current  hedging policy  provides for the use of forward sales contracts to
     hedge up to 30% of each of the  following ten year's  expected  annual gold
     production,  and up to 30% of each of the  following  five year's  expected
     annual silver  production,  at prices in excess of certain targeted prices.
     The policy also provides for the use of combinations of put and call option
     contracts to establish minimum floor prices.

     At March 31,  1999 the Company had gold forward sales and option contracts
     outstanding as follows:
<TABLE>
<CAPTION>

                                                Expected Maturity or Transaction Date
                                       ---------------------------------------------------------
                                                                                         There-    Total or
                                         1999      2000      2001      2002     2003     after      Average
                                       --------- ---------- --------  -------- --------  -------  ------------
   <S>                                    <C>         <C>      <C>       <C>      <C>    <C>            <C>
US $ denominated contracts:
   Forward sales contracts:
    Ounces (thousands)                     82.4       85.1     95.0      95.0     75.0                  432.5
    Average price ($ per oz.)              $417       $430     $441      $457     $481                   $445

   Put options owned:
    Ounces (thousands)                    260.0       30.0                                              290.0
    Average price ($ per oz.)              $285       $350                                               $291

   Call options written:
    Ounces (thousands)                    120.0       15.0                                              135.0
    Average price ($ per oz.)              $300       $395                                               $311

Australian $ denominated contracts: (1)
   Forward sales contracts:
    Ounces (thousands)                                24.8     24.8      24.8     24.8     50.8         150.0
    Average price (US$ per oz.)                       $330     $330      $330     $330     $330          $330

   Put options owned:
    Ounces (thousands)                     90.0      120.0    120.0                                     330.0
    Average price (US$ per oz.)            $317       $325     $335                                      $327

<FN>

    (1) Expressed in US dollars at an exchange rate of A$ = US$ 0.6263
</FN>
</TABLE>

     During the three  months  ended March 31,  1999,  the Company  delivered or
     financially  settled  27,500 ounces of gold at an average price of $409 per
     ounce under forward sales contracts and 30,000 ounces of gold at an average
     price of $318 per ounce under option contracts.  This compares to the first
     quarter of 1998 when  Homestake  delivered or financially  settled  153,000
     ounces of gold at an average  price of $338 per ounce under  forward  sales
     and option  contracts.  Homestake  also  delivered or  financially  settled
     755,000  ounces of silver  during  the first  quarter of 1999 at an average
     price of $6.34 per ounce under option contracts. The


                                       7
<PAGE>
                  Homestake Mining Company and Subsidiaries


     Company's gold hedging activities  increased first quarter 1999 revenues by
     approximately $6 million.

8.   In 1998, the Company  adopted SFAS 131,  "Disclosures  about Segments of an
     Enterprise and Related  Information."  The Company  primarily is engaged in
     gold  mining and  related  activities.  Gold  operations  are  managed  and
     internally reported based on the following geographic areas: United States,
     Australia and Canada.  The Company also has gold operations in Chile, other
     foreign exploration activities and a sulfur operation in the Gulf of Mexico
     which are included in  "Corporate  and All Other".  Within each  geographic
     segment,  operations are managed on a mine-by-mine basis.  However,  due to
     each mine  having  similar  characteristics,  the  Company  has adopted the
     aggregation approach available under SFAS 131. Segment information for the 
     three months ended March 31, 1999 and 1998 is as follows (in thousands):
<TABLE>
<CAPTION>

                                                                 Corporate
                          United                                  and All        Reconciling
                          States      Australia      Canada        Other          Items         Total
                       -----------------------------------------------------------------------------------
<S>                        <C>            <C>           <C>         <C>           <C>            <C>     
1999
Revenues                   $ 42,849       $64,352       $60,287     $ 19,778      $ (8,733)      $178,533
Operating
   earnings (loss)            3,418        13,377        19,659       10,363        (8,733)        38,084

1998
Revenues                   $ 63,060       $73,958       $62,093     $ 17,936        $ (830)      $216,217
Operating
   earnings (loss)            7,504         5,587        23,905        8,404          (830)        44,570
</TABLE>

9.   Homestake's comprehensive income (loss) for the three months ended March
     31, 1999 and 1998 was as follows (in thousands):
<TABLE>
<CAPTION>

                                                                      Three Months Ended March 31,
                                                                       1999                   1998
                                                                  ---------------         --------------
<S>                                                                      <C>                    <C>     
Net Income (Loss)                                                        $ 2,198                $(6,586)
Other Comprehensive Income (Loss)
     Currency translation adjustments                                     10,147                  5,917
     Unrealized losses on securities                                         (35)                (2,294)
                                                                  ---------------         --------------
Total Other Comprehensive Income                                          10,112                  3,623
                                                                  ---------------         --------------

Comprehensive Income (Loss)                                              $12,310                $(2,963)
                                                                  ===============         ==============
</TABLE>

     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


                                       8
<PAGE>
                  Homestake Mining Company and Subsidiaries



     the hedged items.  SFAS 133 is effective for fiscal years  beginning after
     June 15, 1999 but earlier adoption is permitted.  The Company believes that
     under SFAS 133,  changes  in  unrealized  gains and  losses on  Homestake's
     foreign  currency  contracts  will  qualify  for  hedge  accounting  and be
     deferred  in  other   comprehensive   income.   However,   there  are  many
     complexities  to this new standard and the Company  currently is evaluating
     the  impact  that  SFAS 133 will have on  reported  operating  results  and
     financial  position and has not yet  determined  whether it will adopt SFAS
     133 earlier than January 1, 2000.

10.  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 total  future  cost for  reclamation,  remediation,
     monitoring and maintaining compliance at the Grants site is estimated to be
     $14 million.

     Pursuant to the Energy Policy Act of 1992, the United States  Department of
     Energy  ("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 March 31, 1999, Homestake had received $25.6
     million from the DOE and the  accompanying  balance sheet at March 31, 1999
     includes an  additional  receivable  of $8.2 million for the DOE's share of
     reclamation expenditures made by Homestake through 1998. Homestake believes
     that its share of the estimated  remaining  cost of  reclaiming  the Grants
     facility is fully provided in the financial statements at March 31, 1999.

     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: Deposits of tailings along an 18-mile stretch of Whitewood
     Creek formerly  constituted a site on the NPL.  Whitewood  Creek was a site
     where  mining  companies  operating  in the  Black  Hills of South  Dakota,
     including  Homestake,  placed mine  tailings  beginning  in the  nineteenth
     century. Some tailings placed in Whitewood Creek eventually flowed into the
     Belle Fourche River, the Cheyenne River and Lake Oahe. Homestake ceased the
     placement of mine tailings into  Whitewood  Creek in 1977 and for more than
     21 years the  Homestake  mine has  impounded all mine tailings that are not
     redeposited in the mine. The site was deleted from the NPL in 1996.

     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. The complaint also
     contained a pendent state law claim,  alleging that the tailings constitute
     a continuing  public  nuisance.  The  complaint  asks for  abatement of the
     nuisance,   damages  in  an  unascertained  amount,  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


                                       9

<PAGE>
                  Homestake Mining Company and Subsidiaries


     there has been any continuing  damage to natural resources or nuisance as a
     result of the placement of tailings in Whitewood Creek.  Homestake has also
     counterclaimed  against the State of South Dakota and the Federal  Trustees
     seeking cost recoupment, contribution and indemnity.

     Homestake,  the State of South Dakota and the Federal  Trustees are engaged
     in settlement  discussions with respect to these actions.  If settlement is
     not achieved,  Homestake  intends to vigorously defend these actions and to
     seek cost  recoupment,  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.

     In  addition  to the  above,  the  Company  is party to legal  actions  and
     administrative proceedings and is subject to claims arising in the ordinary
     course of business.  The Company  believes the disposition of these matters
     will not have a  material  adverse  effect  on its  financial  position  or
     results of operations.

11.  On December 3, 1998  Homestake  completed the  acquisition  of the 49.4% of
     Prime Resources Group Inc. ("Prime") it did not already own. Under the Plan
     of Arrangement,  Prime  shareholders  had the option of receiving 0.74 of a
     Homestake  common  share  or  0.74  of  a  Homestake  Canada  Inc.  ("HCI")
     exchangeable  share for each Prime share.  Each HCI  exchangeable  share is
     exchangeable  for one  Homestake  common share at any time at the option of
     the  holder and has  essentially  the same  voting,  dividend  (payable  in
     Canadian dollars), and other rights as a Homestake common share. A share of
     special  voting stock was issued to Montreal  Trust  Company of Canada,  in
     trust for the  holders of the HCI  exchangeable  share,  and  provides  the
     mechanism for holders of HCI  exchangeable  shares to receive voting rights
     in Homestake.  Homestake  owns all of HCI's common shares  outstanding.  At
     March 31, 1999, HCI had 8.1 million HCI exchangeable shares outstanding all
     of which were held by the public.  Summarized financial information for HCI
     is as follows:

                                       10
<PAGE>
                  Homestake Mining Company and Subsidiaries


<TABLE>
<CAPTION>

                                                           March 31,                December 31,
                                                             1999                       1998
                                                       ------------------        --------------------

<S>                                                             <C>                        <C>      
Current assets                                                 $  53,341                   $ 149,102
Noncurrent assets                                                523,077                     524,588
                                                       ------------------        --------------------
       Total assets                                            $ 576,418                   $ 673,690
                                                       ==================        ====================

Notes payable to the Company                                   $ 125,643                   $ 144,002
Other current liabilities                                         26,781                      40,837
Long-term liabilities                                             16,496                      15,882
Deferred income and mining taxes                                 197,973                     193,074
Redeemable preferred stock
       held by the Company                                             -                      36,167
Shareholders' equity                                             209,525                     243,728
                                                       ------------------        --------------------
       Total liabilities and
           shareholders' equity                                $ 576,418                   $ 673,690
                                                       ==================        ====================
</TABLE>


<TABLE>
<CAPTION>

                                                                     Three Months Ended
                                                                          March 31,
                                                             1999                        1998
                                                       ------------------          ------------------

<S>                                                             <C>                         <C>     
Total revenues                                                  $ 57,918                    $ 62,093
Costs and expenses                                                46,471                      41,747
                                                       ------------------          ------------------
Income before taxes and
       minority interests                                       $ 11,447                    $ 20,346
                                                       ==================          ==================

Net income                                                       $ 3,951                     $ 4,920
                                                       ==================          ==================
</TABLE>


12. Subsequent Event - Argentina Gold Corp.

     On April 27, 1999,  shareholders of Argentina Gold Corp. ("Argentina Gold")
     approved a Plan of Arrangement for Homestake to acquire the Vancouver-based
     Argentina Gold for  approximately  $190 million in Homestake common shares.
     Argentina  Gold's  principal  asset  is its 60%  interest  in the  Veladero
     property  located in northwest  Argentina along the El Indio gold belt. The
     transaction  closed  on  April  29,1999.  Under  the  Plan of  Arrangement,
     Argentina Gold shareholders received 0.545 Homestake common shares for
     each share of Argentina Gold.  Homestake  issued  approximately  21 million
     common  shares  to  acquire  all of  the  shares  of  Argentina  Gold.  The
     transaction will be accounted for as a pooling of interests.


                                       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.  Homestake reports per ounce production costs in accordance
with the "Gold Institute Production Cost Standard.")

         On  April  30,  1998  Homestake  acquired  Plutonic  Resources  Limited
("Plutonic"),  an Australian  gold producer,  by issuing 64.4 million  Homestake
common  shares.  This  business  combination  was  accounted for as a pooling of
interests,  and accordingly,  the Company's  consolidated  financial  statements
include Plutonic for all periods.

                              RESULTS OF OPERATIONS

         Homestake recorded net income of $2.2 million or $0.01 per share during
the first  quarter of 1999  compared to a net loss of $6.6  million or $0.03 per
share during the first quarter of 1998.  First  quarter of 1999 results  include
pretax  foreign  currency  exchange  gains of $9.4  million  compared  to pretax
foreign  currency  exchange gains of $5.1 million and gains on the sale of Rabbi
Trust  investments of $4 million in the first quarter of 1998. The first quarter
of 1998 also included after-tax unusual charges totaling $8.6 million or $0.04
per share.  No charges for unusual items were recorded  during the first quarter
of 1999.

         Consolidated production for the 1999 first quarter totaled 559,000 gold
equivalent  ounces,  a 13% reduction  from the 1998 first quarter  production of
641,300  gold  equivalent  ounces.  This  reduction  primarily  is due to  lower
production from the Homestake,  Eskay Creek,  Kalgoorlie and Plutonic operations
and the absence of production from the closed Mt Morgans mine,  partially offset
by higher  production from the Darlot and Williams mines. Gold and ore sales for
the first quarter of 1999 decreased to $159.2 million from $194.3 million during
the first  quarter of 1998  reflecting  lower gold  prices and  decreased  sales
volumes  resulting from the lower  production.  During the first three months of
1999,  554,000  equivalent ounces of gold were sold at an average realized price
of $298 per  ounce  compared  to  638,700  equivalent  ounces of gold sold at an
average  realized price of $317 per ounce during the first three months of 1998.
Consolidated  cash costs per ounce during the first  quarter of 1999 declined by
9% to $193 per ounce from $213 per ounce during the corresponding  first quarter
of 1998.  Approximately  $8 per ounce of this decrease is  attributable to lower
average  Australian and Canadian  dollar  exchange rates in the first quarter of
1999 compared to the first quarter of 1998.

         United States  production  decreased to 142,400 ounces during the first
quarter  of 1999 from  182,300  ounces  during the first  quarter  of 1998.  The
decrease  primarily is due to lower  production at the Homestake  mine following
the completion of open-pit  mining during 1998,  along with lower  production at
the Ruby Hill and Pinson mines. The weighted average United States cash cost was
$218 per ounce  during  the first  quarter  of 1999  compared  to $219 per ounce
during the first quarter of 1998.


                                       12
<PAGE>
                  Homestake Mining Company and Subsidiaries



         Gold  production at the Homestake mine in South Dakota during the first
quarter of 1999 was 45,700 ounces  compared to 76,000 ounces produced during the
first quarter of 1998. The Homestake mine is now mining ore exclusively from the
underground  operation.  Open Cut mining  operations  were completed  during the
fourth  quarter of 1998,  but three to five months of  stockpiled  low-grade ore
from the former surface mine remain to be processed in 1999.  Processing of this
stockpiled  ore was  restricted  during  the first  quarter of 1999 due to above
average  precipitation,  which  resulted  in higher than  normal  water  volumes
collecting in the tailings  impoundment.  Almost all of the mine's production in
the  first  quarter  of 1999 was  sourced  from  the  underground  mine  whereas
approximately  78% of the first quarter 1998 production came from the lower-cost
Open Cut  operations  due to the  temporary  shut  down in  January  1998 of the
underground operations.  As a result, cash costs at the Homestake mine increased
to $271 per ounce  during the first  quarter of 1999 from $244 per ounce  during
the first  quarter of 1998.  Gold  production at the Ruby Hill mine near Eureka,
Nevada  totaled  25,200 ounces at a cash cost of $121 per ounce during the first
quarter of 1999  compared to 30,600  ounces at a cash cost $129 per ounce during
the prior  year's  first  quarter.  The  decrease  in  production  is due to the
exceptionally high ore grades during the first quarter of 1998 as initial mining
occurred  in  higher-grade  areas of the pit.  Current  mining  grades  are more
comparable to the average  life-of-mine  reserve.  Cash costs per ounce declined
due to a larger  percentage of  high-grade  ore being  amenable to  conventional
milling resulting in higher recoveries compared to heap leaching.  First quarter
1999  production  from the  processing of residual  stockpiles at the McLaughlin
operation  in northern  California  totaled  30,200  ounces of gold,  relatively
unchanged  from the 30,100  ounces  produced  during the first  quarter of 1998.
Increased  throughput  offset a 12% decline in ore grade,  but  resulted in a 5%
increase in cash costs to $244 per ounce during the 1999 first quarter from $233
per ounce during the 1998 first quarter.  Homestake's  share of production  from
the Round Mountain mine in central Nevada declined to 29,800 ounces in the first
quarter of 1999 from 33,000 ounces during the prior year's first  quarter.  Cash
costs declined to $196 per ounce during the 1999 first quarter  compared to $207
per ounce during the 1998 first quarter.  Reusable pad gold production was lower
during   the   quarter   as   mining   equipment   was   diverted   to   conduct
higher-than-normal  overburden  stripping.  Production  from Round  Mountain  is
expected to improve during the second quarter of 1999 as the overburden  removal
increases access to additional ore. The Pinson mine near Winnemucca,  Nevada was
placed on care and maintenance in January 1999 due to continuing low gold prices
and production  shortfalls.  Homestake's 50% share of residual recovery from the
heap-leach pads was 3,600 ounces of gold at a cash cost of $242 per ounce during
the first  quarter of 1999  compared to  production  of 6,400 ounces at $321 per
ounce  during  the  comparable  period  in 1998.  The  operation  is  conducting
reclamation  of  the  tailings   impoundment  and  waste  rock  disposal  areas.
Exploration  continues  to  further  define the deep  mineralization  discovered
during the 1998 drilling program.

         Canadian gold  production  decreased to 218,000 ounces during the first
quarter of 1999 from 230,500 ounces during the first quarter of 1998,  primarily
due to lower  production  at the Eskay Creek mine.  During the first  quarter of
1999, the weighted average cash costs per ounce from the Company's operations in
Canada  decreased  to $162 per ounce from $165 per ounce  during the  comparable
period of the prior year primarily due to a lower Canadian/U.S.  dollar exchange
rate. On a local currency basis,  weighted  average Canadian cash cost per ounce
increased by 3%.


                                       13
<PAGE>
                 Homestake Mining Company and Subsidiaries



         At the Eskay Creek mine,  first quarter 1999 gold production  decreased
to 123,500 gold  equivalent  ounces from 141,100 gold  equivalent  ounces in the
corresponding  period of 1998.  Cash costs for both periods were $121 per ounce.
Gold and silver  production  during the first  quarter of 1999 was 70,200 ounces
and 2.9 million ounces, respectively,  compared to 73,400 ounces and 3.2 million
ounces,  respectively,  during the comparable  period in 1998.  Gold  equivalent
production was lower in the 1999 first quarter due to lower ore shipments and an
increase  in the silver to gold  equivalency  ratio,  partially  offset by a 31%
increase in mill  throughput.  Homestake's  50% share of gold  production at the
Williams  mine  increased  to 51,900  ounces for the first  quarter of 1999 from
44,700  ounces  during the similar  period in 1998 due to a 15%  increase in ore
grade. A seismic event that occurred at the end of March 1999 resulted in damage
to access drifts and an orepass.  Expenses for  restoration  and repairs are not
expected to significantly  impact operating costs or adversely impact production
during the year.  Cash costs declined to $220 per ounce during the first quarter
of 1999 compared to $244 per ounce during the similar  period in 1998  primarily
due to the higher ore grade.  Work to increase the capacity of the Williams mill
is progressing on schedule.  The operation expects to process the first ore from
the David Bell mine by mid-year 1999.  Homestake's  50% share of gold production
at the David Bell mine  totaled  18,700  ounces at a cash cost of $214 per ounce
compared  to 18,200  ounces at a cash  cost of $238 per ounce  during  the first
quarter of 1998.  The lower cash costs per ounce resulted from higher ore grades
and a lower  exchange  rate.  During the first  quarter  of 1999,  the Snip mine
produced  21,100  ounces of gold at a cash cost of $214 per  ounce  compared  to
23,700 ounces at a cash cost of $224 per ounce during the  comparable  period in
1998.  The  operation is scheduled to cease  production  at the end of May 1999.
Reclamation has commenced and will continue after completion of mining.


         Australian gold production  declined to 192,000 ounces during the first
quarter of 1999  compared  to 222,900  ounces  during the first  quarter of 1998
primarily due to lower  production  from the Kalgoorlie and Plutonic  operations
and absence of production from the closed Mt Morgans mine,  partially  offset by
higher  production  from the  Darlot  mine.  During  the first  quarter of 1999,
Australian  cash costs per ounce decreased to $210 per ounce from $256 per ounce
during the comparable  period of the prior year.  Eleven dollars of this decline
is attributable to the 5% decline in the Australian/U.S. dollar exchange rate.

         Homestake's share of production at the Kalgoorlie operations in Western
Australia  totaled  83,000  ounces at a cash cost of $210 per ounce  during  the
first quarter of 1999 compared to 94,100 ounces at a cash cost of $262 per ounce
during the first three  months of 1998.  The  decrease in  production  primarily
resulted  from reduced mill  throughput  in an effort to minimize  stress on the
Fimiston  Mill's  cracked  ring  gear.  A  replacement  gear  is  scheduled  for
installation  in May 1999.  Cash  costs per ounce  were lower as a result of the
improved  performance at the restructured Mt Charlotte mine along with the lower
exchange rates.  The conversion from contractor to owner mining is proceeding on
schedule and mining  equipment is being  ordered in the second  quarter of 1999.
Gold  production  at the Plutonic  mine was 48,300 ounces at a cash cost of $264
per ounce during the first  quarter of 1999  compared to 56,300 ounces at a cash
cost of $266 per ounce  during the first  quarter of 1998.  In March  1999,  the
operation  incurred minor  production  disruptions  due to adverse  weather from
Cyclone  Vance.  Gold  production  was lower than planned from the open pits and
treatment of lower grade  stockpile  ore was  required to maintain  full process
plant capacity.  Gold production at the Lawlers mine was 27,300 ounces at a cash
cost of $162 per ounce during the first


                                       14
<PAGE>
                 Homestake Mining Company and Subsidiaries


quarter  compared to 31,600  ounces at a cash cost of $189 per ounce  during the
corresponding  quarter  in  1998.  The  decline  in  gold  production  is due to
completion  of  open-pit  mining.  In 1999,  production  is  primarily  from the
underground mine.  Additional  underground  declines have been started to access
ore lenses that trend below the New Holland South and Genesis pits.  Development
drilling  completed  in various  areas of the  Glasgow-Lass  trend  continues to
produce  positive results  confirming  continuity in the existing ore lenses and
indicating the presence of several new lenses. During the first quarter of 1999,
the Darlot mine produced  27,900 ounces of gold at a cash cost of $174 per ounce
compared  to 15,600  ounces of gold at a cash cost of $334 per ounce  during the
corresponding  period in 1998.  The  improved  performance  is  attributable  to
increased production from the higher-grade Centenary ore body. A treatment plant
upgrade project was started during the first quarter and is expected to increase
gold recoveries following completion in the third quarter of 1999.

         The Company's  share of revenues at the Main Pass 299 operations in the
Gulf of Mexico totaled $3.9 million during the first quarter of 1999 compared to
$6.1 million  during the first  quarter of 1998,  and  operating  losses of $1.4
million were recorded during the 1999 first quarter compared to operating losses
of $0.7 million during the first quarter of 1998.

         Homestake's  hedging  policy  provides  for  the use of  forward  sales
contracts to hedge up to 30% of each of the following ten year's expected annual
gold  production,  and up to 30% of each of the following  five year's  expected
annual silver  production,  at prices in excess of certain targeted prices.  The
policy  also  provides  for  the use of  combinations  of put  and  call  option
contracts to establish  minimum floor prices.  During the first quarter of 1999,
Homestake  delivered or financially  settled 57,500 ounces of gold at an average
price of $362 per ounce under forward sales and option contracts.  This compares
to the first quarter of 1998 when  Homestake  delivered or  financially  settled
153,000 ounces of gold at an average price of $338 per ounce under forward sales
and option  contracts.  Homestake also delivered or financially  settled 755,000
ounces of silver  during the first  quarter of 1999 at an average price of $6.34
per  ounce  under  option  contracts.  The  Company's  gold and  silver  hedging
activities  increased first quarter 1999 revenues by  approximately  $6 million.
The estimated fair value of the Company's  gold and silver  hedging  position at
March 31, 1999 was approximately $83 million.

         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.  For the three months ended March 31, 1999
the Company  recorded  gains of $7.9  million on these  contracts.  At March 31,
1999, the Company's  provision for net unrealized losses on open contracts under
this program was $12 million.

Other  income  for the first  three  months of 1999  includes  foreign  currency
exchange  gains of $9.4  million,  including  $7.9 million for foreign  currency
option  contracts and $1.5 million  primarily for intercompany  advances.  Other
income in the  corresponding  period of 1998 includes foreign currency  exchange
gains of $5 million and gains on sales of investments of $4 million.

                                       15
<PAGE>
                 Homestake Mining Company and Subsidiaries


Depreciation,  depletion  and  amortization  expense  decreased to $31.7 million
during the 1999 first  quarter from $36.1  million  during the first  quarter of
1998  reflecting  write-downs of property,  plant and equipment at the Homestake
and Mt Charlotte mines during the third quarter of 1998,  partially offset by an
increase  in  depreciation  expense  at the Eskay  Creek mine as a result of the
December 1998 acquisition of the Prime minority interests.

Exploration expense for the first three months of 1999 decreased to $7.7 million
compared to $10.3 million during the first quarter of 1998. The Company  expects
to spend  approximately  $43  million  on  exploration  activities  during  1999
(excluding approximately $3 million of exploration expense incurred by Argentina
Gold Corp. prior to its April 1999 business combination with Homestake).

Income and mining tax  expense  for the three  months  ended  March 31, 1999 was
$12.5 million compared to $7.2 million for the same period in 1998. The increase
in tax expense resulted from the increase in pretax income and a one-time charge
of  approximately  $3 million related to the  repatriation of cash to the United
States from the Company's  Canadian  subsidiaries.  In addition to this one-time
charge, the consolidated effective tax rate of 87.6% during the first quarter of
1999,  reflects the  geographic  mix of pretax income and losses.  Homestake had
pretax earnings in Canada and Australia,  which are subject to high rates of tax
and  pretax  losses in other  foreign  jurisdictions  on which it was  unable to
record a tax  benefit  due to the  uncertainty  of  realization.  The  Company's
consolidated  effective  income and mining tax rate will fluctuate  depending on
the geographical mix of pretax income.

Minority interests:  During the 1999 first quarter, minority interests' share of
losses  in  consolidated  subsidiaries  of $0.4  million  compares  to  minority
interests'  share of income in consolidated  subsidiaries of $3.9 million in the
first quarter of 1998.  The decrease in minority  interests'  share of income is
due to Homestake's  December 1998 acquisition of the minority interests of Prime
Resources Group Inc.

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



                                       16
<PAGE>
                 Homestake Mining Company and Subsidiaries



<TABLE>
<CAPTION>

                                                         Production                             Total Cash Costs
                                                    (Ounces in thousands)                      (Dollars per ounce)
                                                     Three Months Ended                         Three Months Ended
                                                          March 31,                                  March 31,
Mine (Percentage interest)                           1999            1998                       1999            1998
----------------------------------            ----------------------------              -----------------------------
<S>                                                 <C>             <C>                         <C>             <C>  
United States
   Homestake (100)                                   45.7            76.0                       $271            $244
   Ruby Hill (100)                                   25.2            30.6                        121             129
   McLaughlin (100)                                  30.2            30.1                        244             233
   Round Mountain (25)                               29.8            33.0                        196             207
   Pinson (50)                                        3.6             6.4                        242             321
   Marigold (33)                                      7.9             6.2                        190             246
                                              ------------    ------------
       Total United States                          142.4           182.3
Canada
   Eskay Creek (100) (1,3)                          123.5           141.1                        121             121
   Williams (50)                                     51.9            44.7                        220             244
   David Bell (50)                                   18.7            18.2                        214             238
   Quarter Claim (25)                                 2.8             2.8                        162             171
   Snip (100) (2,3)                                  21.1            23.7                        214             224
                                              ------------    ------------
        Total Canada                                218.0           230.5
Australia
   Kalgoorlie (50)                                   83.0            94.1                        210             262
   Plutonic (100)                                    48.3            56.3                        264             266
   Darlot (100)                                      27.9            15.6                        174             334
   Lawlers (100)                                     27.3            31.6                        162             189
   Peak Hill (67)                                     5.5             5.8                        177             308
   Mt Morgans (80)                                      -            19.5                          -             231
                                              ------------    ------------
        Total Australia                             192.0           222.9
Chile
   Agua de la Falda (51)                              6.6             5.6                        212             215
                                              ------------    ------------              -------------  --------------
   Total Production                                 559.0           641.3                       $193            $213
                                                                                        =============  ==============
   Minority Interests                                   -           (81.4)
                                              ------------    ------------
   Homestake's Share                                559.0           559.9
                                              ============    ============

                                       17
<PAGE>
                Homestake Mining Company and Subsidiaries


<CAPTION>

                                                               Three Months Ended
                                                                   March 31,
Per Ounce of Gold                                       1999                   1998
                                                ------------------------------------
<S>                                                     <C>                    <C> 
Revenue                                                 $298                   $317
                                                ====================================

Per Ounce Costs
Cash Operating Costs (4)                                $189                   $210
Other Cash Costs (5)                                       4                      3
                                                ------------------------------------
     Total Cash Costs                                    193                    213
Noncash Costs  (6)                                        55                     57
                                                ------------------------------------
     Total Production Costs                             $248                   $270
                                                ====================================

<FN>
(1)  Ounces produced are expressed on a gold equivalent basis and include 70,200
     (73,400  in 1998)  ounces of gold and 2.9  million  (3.2  million  in 1998)
     ounces of silver contained in ore and concentrates  sold to smelters in the
     first quarter.

(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)  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.

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

(6)  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>


                                       18
<PAGE>
               Homestake Mining Company and Subsidiaries


                         LIQUIDITY AND CAPITAL RESOURCES



         Cash  provided by operations  totaled  $26.5  million  during the first
quarter of 1999  compared  to $22.3  million  during the first  quarter of 1998.
Working capital at March 31, 1999 amounted to $270.9 million, including cash and
equivalents and short-term investments of $267.3 million.

         Capital  expenditures of $13.3 million during the first quarter of 1999
compare to expenditures of $18 million during the first quarter of 1998. Capital
expenditures in 1999 include approximately $7.1 million at the Plutonic,  Darlot
and Lawlers mines primarily for underground development work. The balance of the
1999  capital  expenditures   primarily  relate  to  underground  mobile  mining
equipment  purchases  at  the  Homestake  mine  and  sustaining  capital  at the
Company's  other  operating  mines.  Capital  additions  during 1998 include $18
million,  primarily for underground  development work at the Plutonic and Darlot
mines,  development work at the Kalgoorlie  operations,  and new shops and other
facilities at the Round Mountain mine.

         The Company has a United States/Canadian/Australian cross-border credit
facility  providing  a total  availability  of $430  million.  This  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. During the
first  quarter  of 1999,  the  Company  repaid $48  million  (A$75  million)  of
Australian dollar-denominated borrowings under the credit facility from existing
cash balances.  At March 31, 1999 borrowings under the Australian  dollar credit
facility of $99 million  (A$158  million) were  outstanding.  The Company pays a
commitment  fee on the unused  portion of this  facility  ranging  from 0.15% to
0.35% per annum,  depending  upon rating  agencies'  ratings  for the  Company's
senior debt. The credit agreement requires a minimum  consolidated net worth, as
defined in the agreement (primarily  shareholders' equity plus the amount of all
noncash write-downs made after December 31, 1997), of $500 million.  Interest on
the  Australian  dollar  borrowings  is  payable  quarterly  and is based on the
Australian Bank Bill Swap Rate plus a margin of up to 1.125%.  At March 31, 1999
this interest rate was 5.88%.

         In July 1997, Lawrence County, South Dakota issued $30 million of South
Dakota Solid Waste  Disposal  Revenue  Bonds  ("Waste  Disposal  Bonds") and $18
million of South Dakota Pollution Control Refunding Revenue Bonds, both of which
are due in 2032. The Company is responsible  for funding  principal and interest
payments on these bonds.  Due to a reduction in the size of the  Homestake  mine
tailings  project,  the Company redeemed $10 million of the Waste Disposal Bonds
in March 1999 out of the funds held in trust.

         The Company has $150  million of 5.5%  convertible  subordinated  notes
outstanding  which  mature on June 23,  2000.  Interest  on the notes is payable
semiannually in June and December.  The notes are convertible into the Company's
common  shares at a rate of $23.06 per common  share and are  redeemable  by the
Company in whole at any time. The Company expects to refinance these notes prior
to their maturity.

         In March 1999,  Company  declared a  semi-annual  dividend of $0.05 per
common share and C$0.075 per HCI  exchangeable  share, both payable May 10, 1999
to shareholders of record on April 20, 1999.


                                       19
<PAGE>
              Homestake Mining Company and Subsidiaries



         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
believes  that  under  SFAS 133,  changes  in  unrealized  gains  and  losses on
Homestake's  foreign currency contracts will qualify for hedge accounting and be
deferred in other comprehensive income.  However, there are many complexities to
this new standard and the Company  currently is evaluating  the impact that SFAS
133 will have on reported  operating results and financial  position and has not
yet determined whether it will adopt SFAS 133 earlier than January 1, 2000.

         Future  results will be impacted by such factors as the market price of
gold  and  silver,  the  Company's  ability  to  expand  its ore  reserves,  and
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.

Year 2000 Compliance

         The Company has  completed a review of its  computer-based  information
systems  and has  developed a plan to ensure all of these  systems  will be Year
2000  compliant.  Year 2000 compliant  upgrades for the Company's core financial
systems have been  installed  and testing of these  systems is  continuing.  All
other critical Company information systems hardware and software will be brought
into compliance by mid-1999.

         The   Company   currently   is  in  the   process  of   reviewing   all
microprocessor-controlled  devices, including process-monitoring systems, in use
at its operating  locations to determine  whether they are Year 2000  compliant.
The  identification  phase has been  completed  and  assessment  research of the
identified  devices is ongoing.  The Company will upgrade systems and/or develop
contingency plans based on this research.  Any necessary remediation and testing
is planned to be completed by mid-1999.  In addition,  the Company is monitoring
similar Year 2000 related activities at its joint venture operations where it is
not  the  operator.  A Year  2000  related  microprocessor  problem  that is not
identified or remedied at an operating  location  potentially  could result in a
short-term production disruption at that location.

         The Company's total expenditures for the above Year 2000 activities are
expected to be approximately  $1.5 million and should not adversely impact other
information   system   initiatives.   Year  2000   expenditures  to  date  total
approximately $1 million.


                                       20
<PAGE>
              Homestake Mining Company and Subsidiaries



         The Company currently is surveying all major suppliers and customers to
assess their Year 2000  compliance  and,  where  practical,  will make  specific
contingency plans based on the results of this survey.  The greatest risk to the
Company in this  regard  would be  interruptions  in the supply of power  and/or
water to certain  of its  operating  locations.  A  disruption  in the supply of
either of these utilities could significantly hamper or curtail production at an
operating location until the service is restored.  A disruption in the supply of
other services or supplies at an operating location  potentially could result in
a short-term production disruption at that location.

         With the exception of ore and concentrates  produced at the Eskay Creek
and Snip mines,  which are sold directly to smelters,  the  Company's  principal
product is finished gold bullion, which is sold to major financial institutions.
Because of government  mandated Year 2000  compliance  programs in the financial
industry,  the Company expects that their core financial  operating systems will
be Year 2000 compliant,  and that there will be no significant disruption in the
Company's  ability to sell its gold production.  The smelters which purchase the
ore and  concentrates  produced  at the  Eskay  Creek and Snip  mines  have been
contacted  directly,  and though they have not  completed all of their Year 2000
compliance activities, they do not expect any significant disruptions related to
Year 2000 issues.

         Homestake  will  develop  contingency  plans  if  and  when  determined
necessary based on its compliance efforts.

         The foregoing Year 2000  disclosures  are based on Homestake's  current
expectations,  estimates and projections.  Because of uncertainties,  the actual
effects of the Year 2000 issues on Homestake may be different from the Company's
current  assessment.  Factors,  many of which are  outside  the  control  of the
Company,  that could affect Homestake's ability to be Year 2000 compliant by the
end of 1999 include the failure of customers,  suppliers,  governmental entities
and  others to  achieve  compliance,  and  Homestake's  inability  or failure to
identify all  critical  Year 2000 issues or to develop  appropriate  contingency
plans for all Year 2000 issues that ultimately may arise.


Argentina Gold Corp.

On April 27, 1999,  shareholders  of  Argentina  Gold Corp.  ("Argentina  Gold")
approved a Plan of  Arrangement  for  Homestake  to acquire the  Vancouver-based
Argentina  Gold for  approximately  $190  million in  Homestake  common  shares.
Argentina  Gold's  principal asset is its 60% interest in the Veladero  property
located in northwest  Argentina  along the El Indio gold belt.  The  transaction
closed  on April  29,  1999.  Under  the  Plan of  Arrangement,  Argentina  Gold
shareholders  received  0.545 Homestake  common  shares  for  each  share of
Argentina  Gold.  Homestake  issued  approximately  21 million  common shares to
acquire all of the shares of Argentina Gold. The  transaction  will be accounted
for as a pooling of interests.


                                       21
<PAGE>
              Homestake Mining Company and Subsidiaries



Part II - OTHER INFORMATION

Item 5. - Other Information

(a)      Business Combination - Argentina Gold Corporation

         On April 27, 1999,  shareholders  of Argentina  Gold Corp.  ("Argentina
         Gold")  approved a Plan of  Arrangement  for  Homestake  to acquire the
         Vancouver-based  Argentina  Gold  for  approximately  $190  million  in
         Homestake  common shares.  Argentina  Gold's principal asset is its 60%
         interest in the Veladero property located in northwest  Argentina along
         the El Indio gold belt. The transaction closed on April 29, 1999. Under
         the Plan of Arrangement,  Argentina Gold shareholders received 0.545 
         Homestake  common  shares for each share of Argentina  Gold.  Homestake
         issued  approximately  21 million  common  shares to acquire all of the
         shares of Argentina  Gold. The  transaction  will be accounted for as a
         pooling of interests.



(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


                                       22

<PAGE>
              Homestake Mining Company and Subsidiaries


         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,
         1998, "RISK FACTORS" and "CAUTIONARY  STATEMENTS" included under Part I
         - Item 1, for a more detailed  discussion of factors that may impact on
         expected future results.




                                       23
<PAGE>
              Homestake Mining Company and Subsidiaries


Item 6.



(a)  Exhibits                                            Method of Filing


     11   Computation of Earnings Per Share              Filed herewith
                                                         electronically


     27   Financial Data Schedule                        Filed herewith
                                                         electronically

(b)      Reports on Form 8-K

         One report on Form 8-K was filed  during the  quarter  ended  March 31,
         1999.  The report dated March 10, 1999  announced  that  Homestake  and
         Argentina  Gold had entered into an agreement  for Homestake to acquire
         Argentina Gold.


                                       24
<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:  May 10, 1999                              By /s/ David W. Peat
       ------------                              -----------------
                                                    David W. Peat
                                                    Vice President, Finance and
                                                    Chief Financial Officer


                                       25