UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-KSB

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1999

Golden Phoenix Minerals, Inc

(Exact name of registrant as specified in its charter)



Minnesota
    0-22905
    41-1878178(State of
    (Commission
    (IRS Employerincorporation)
    File Number)
    Identification No.)


3595 Airway Dr. Suite 405

Reno, Nevada 89511

(775) 853-4919

Securities registered pursuant to section 12(g) of the Act:

Common Shares

Preferred Shares

Shares Underlying the Options

(Title of each class)

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

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best
of registrant's knowledge, in definitive proxy or other information statements
incorporated by reference in Part III of this Form 10-K or any amendments to this Form
10-K.[ ]

State issuer's revenues for its most recent fiscal year: $4,700.

The aggregate market value of the voting stock held by non-affiliates,
computed by reference to the average of the bid and asked prices for such stock as of
March 22, 2000, was $5,472,562.

The total number of common shares outstanding at March 22, 2000 was
25,534,643.





DOCUMENTS INCORPORATED BY REFERENCE

None.



CONTENTS

Page

PART I

Item 1. BUSINESS
                                          
                                          
                                3

Item 2. PROPERTY
                                          
                                          
                               7

Item 3. LEGAL PROCEEDINGS
                                          
                                          
         14

Item 4. SUBMISSION OF MATTERS TO A VOTE

OF SECURITY HOLDERS
                                          
                                          
                14



PART II

Item 5. MARKET FOR REGISTRANTS COMMON

EQUITY AND RELATED STOCKHOLDER

MATTERS
                                          
                                          
                                        14

Item 6. MANAGEMENTS DISCUSSION AND

ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS
                                          
                                         15

Item 7. FINANCIAL STATEMENTS AND

SUPPLEMENTARY DATA
                                          
                                          
           16

Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON

ACCOUNTING AND FINANCIAL DISCLOSURE
                                          
              16



PART III

Item 9. DIRECTORS AND EXECUTIVE OFFICERS OF

THE REGISTRANT
                                          
                                          
                       16

Item 10. EXECUTIVE COMPENSATION
                                          
                            18

Item 11. SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT
                                          
               19

Item 12. CERTAIN RELATIONSHIPS AND RELATED

TRANSACTIONS
                                          
                                          
                         20

Item 13. FINANCIAL STATEMENTS, EXHIBITS, AND REPORTS ON

FORM 8-K
                                          
                                          
                                      21





PART I



Item 1. - BUSINESS

Golden Phoenix Minerals, Inc. (the "Company") was formed in
Minnesota on June 2, 1997 and has had limited operations. The Company **is
headquartered in Reno, Nevada.**

The Company plans to produce economically valuable minerals from the
mineral properties it currently controls, and from mineral properties that it will acquire
in the future. The Company intends to concentrate its exploration efforts in the Western
United States.

The Company's corporate directors and officers are comprised of two
former senior management, geological exploration and development staff members from Santa
Fe Pacific Gold Corp. (Santa Fe) and one senior exploration manager from Kennecott
Exploration Co. (Rio Tinto). This experienced and diverse team has in excess of fifty-five
years of major corporate mineral exploration, development, and gold production experience.

Golden Phoenix's key employees were actively involved in the
exploration, discovery and development activities of Santa Fe, which was the sixth largest
gold producer in North America before it was purchased in 1997 by Newmont Mining Company,
North America's largest gold producer, for $2.2 billion. Santa Fe discovered and developed
over 28 million ounces of gold reserves with annual production in excess of 800,000
ounces. Another of the Companys key employees worked for Kennecott Exploration
Company, which is part of Rio Tinto Ltd., the worlds largest mining company, as
manager of Western US Exploration.

The Company provides joint venture opportunities to selected mining
companies to conduct exploration or development on mineral properties the Company owns or
controls. The Company and its joint venture partners will explore and develop selected
properties to a stage of proven and probable reserves, at which time the Company will then
decide whether to sell its interest in a property or take the property into production
with its joint venture partner. By joint venturing its properties and thereby reducing its
share of the costs for exploration of those properties, the Company can maintain, while
continuing to acquire, an interest in a portfolio of gold and base metals properties in
various stages of mineral exploration and development. This corporate strategy will
minimize financial risk that the Company would incur by assuming all the exploration costs
associated with developing any one property, while maximizing the potential of success and
growth.

The Company believes that it has created the basis for a competitive
minerals exploration company through assembling a unique group of individuals with
experience in target generation and discovery, resource evaluation and mine development.

There are at least five sources of land for exploration by the Company:
public lands, private fee lands, aboriginal tribal lands, unpatented mining claims, and
patented mining claims. The primary sources for acquisition of these lands are the United
States government, through the Bureau of Land Management and the U. S. Forest Service,
through state governments, through tribal governments, and through individuals or entities
who currently hold title to or lease government and private lands.

There are numerous levels of government regulation associated with the
activities of exploration and mining companies. The only two types of permitting which the
Company should have to be concerned with in the near future are "Notice of
Intent" and "Plan of Operation." Both of these types of procedures will be
necessary in the next twelve months. The Company has filed for one of these permits and
has received approval of a notice at Contact. However, there is no guarantee that the
regulatory agency will timely approve, if at all, the necessary permits for other
operations. Further, it will be necessary to obtain or post a bond for the reclamation of
the proposed surface disturbance.

The total cost and effects on the Companys operations of the
permitting and bonding process cannot be estimated at this time. The cost will vary for
each project when they are initiated.

JOINT VENTURES

The following section describes several agreements that the Company
entered into in order to gain an operating interest or provide an opportunity for another
company to earn an interest in our properties.

Contact

Golden Phoenix Minerals has two agreements in place on the Contact
property in northern Nevada. The Company acquired the right to earn a 60 percent interest
in the Enexco patented mining claims through a combination of work commitments on the
Contact property and payments to Enexco totaling US$2,913,000 over seven years. Golden
Phoenix Minerals then has the option to acquire Enexco's 40 percent in the joint venture
for an additional US$5 million for the first 20 percent and US$10 million for the
remaining 20 percent. A 0.25 percent net smelter return royalty burdens the property. On
July 10, 1998 Golden Phoenix Minerals signed a separate exploration license and purchase
option (License/Option) for the Lewis portion of the Contact Project. The License/Option
was acquired for an initial payment of US$15,000 and 100,000 shares of common stock. The
License/Option requires Golden Phoenix Minerals to make monthly cash payments, which will
total US$149,000, and to issue common shares with total cash value of US$2.2 million over
the four and one-half year option term. The purchase price for the Contact property is
US$3 million cash and US$1 million worth of Golden Phoenix Minerals common stock. The SF
Lewis Trust will retain a 5 per cent production royalty on gold and silver and 4 percent
on all other minerals. The production royalty may be purchased for an additional US$3
million cash and US$2 million worth of common stock. Golden Phoenix Minerals is obligated
to expend US$250,000 on exploration during 1998 and US$1.4 million over the term of the
agreement.

Borealis

The Company had signed an acquisition agreement ("Welsh
Agreement") with J. D. Welsh & Associates ("Welsh") to acquire 100
percent of Welsh's lease-hold interest in the Borealis mine project in Mineral
County, Nevada. Prior to terminating the Welsh Agreement, the Company paid Welsh cash and
stock valued at US$1,187,000 and was vested with a 65 percent ownership in the Borealis
Mine project. The Company and Welsh signed a joint venture agreement with Cambior
Exploration USA, Inc. in 1997. Cambior was to earn a 70 percent interest in the project by
spending US$7million over the next 7 years. Cambior completed their first years drilling
commitment, and then because of company budget reductions, they decided to terminate their
interest on December 31, 1998. The Company then signed a simple joint venture agreement
with J. D. Welsh & Associates on December 31, 1999, which increased leasehold
ownership of the project to 68% and further outlined operating relationships between the
parties.

Cirque

In April 1998 the Company signed a Joint Venture Letter of Intent with
Camnor Resources Ltd. to acquire up to 100 percent of seven exploration properties
controlled by the Company in the Bonnifield District located approximately 55 miles
south of Fairbanks, Alaska.. At the end of the 1998 Alaska field season, Camnor decided to
terminate their interests in five of the seven properties, while retaining Cirque and
Glory Creek. Further, in a side agreement made with Great American Minerals and
Exploration, the rights to the Cirque property would be retained by Golden Phoenix and
Glory Creek would be retained by Great American. The Cirque joint venture with option to
purchase agreement with Camnor Resources requires Camnor to pay Golden Phoenix Minerals a
total of $107,000 and 200,000 Camnor shares, and complete a $625,000 work commitment for a
70 percent interest over four years. Camnors next payment date was scheduled for
April 21, 2000 when they will pay the Company $25,000 in cash, 50,000 shares, and commit
to $200,000 of work. However, on March 20, 2000, they gave notice that they were
terminating the joint venture agreement and returning the property to Golden Phoenix
Minerals.

FUNDING

The Company plans to finance its operations through private placement
memorandums (PPM) and the exercising of common stock options controlled by key directors
of the Company. The Company is currently offering a convertible debt Private Placement to
raise approximately $1.3 million. The total amount to be raised may change, based on
varying conversion prices set from time to time during the offering period. The offering
is a 5-year note, paying 12% per annum interest on a minimum investment of $10,000. The
Company may call the notes at any time prior to maturity. In that event, the note holders
have thirty days to decide whether to accept cash payment or convert the note to common
stock. Principal and interest on the note can be converted into shares at any time during
the five year note period, at the option of the note holders. The conversion price was
$0.20 per share for the first $405,000 received in January 2000 and is currently set at
$0.30 per share. The Company will also offset some of its cost by joint-venturing its
properties with other mining groups for exploration and development while paying fees to
Golden Phoenix Minerals, Inc. for the right to certain interest in the property.

COMPETITION

Over the last five years imposition of claim rental policies by the
United States Government and the general exodus of major gold corporations from the U.S.
to pursue mineral exploration in foreign countries has allowed large areas of very
prospective mineral ground to become open for location and acquisition. Due to the
continued decline in the gold price, the number of companies aggressively acquiring claims
and properties has declined during 1998. Gold prices leveled off and rebounded slightly in
1999, resulting in a small increase in claim activity during 1999.

SEASONAL EFFECTS

The Company has positioned itself to handle any seasonal aspect of the
exploration business by locating properties in differing climatic zones, thus allowing
fieldwork on a near year-round basis. Problems of access and inclement weather will be
minimized through strategic planning of fieldwork.

CAPITAL EQUIPMENT

The only capital equipment the Company plans to purchase or lease in
the next twelve months will be two field vehicles. The field vehicles will be for staff
professionals only. All contractors will provide their own vehicles.

STAFFING

The Company has reduced its staffing level to the two key professionals
described in Item 9 below. The Company does not anticipate adding any further permanent
staff in the next twelve months of operation. The Company will employ independent
contractors to fulfill short-term needs and obligations.

ENVIRONMENTAL CONTROLS

The Company is required to comply with numerous environmental laws and
regulations imposed by federal and state authorities. At the federal level, legislation
such as the Clean Water Act, the Clean Air Act, the RCRA, CERCLA and the National
Environmental Policy Act impose effluent and waste standards, performance standards, air
quality and emissions standards and other design or operational requirements for various
components of mining and mineral processing, including gold ore mining and processing. In
1997, the BLM amended its surface management regulations to require bonding of all
hardrock and exploration operations greater than casual use. Until the EPA formally
proposes the new regulatory program, there is not a sufficient basis on which to predict
the potential impacts of such regulations on the Company.

Many states, including the State of Nevada (where a majority of the
Companys properties are located), have also adopted regulations that establish
design, operation, monitoring, and closing requirements for mining operations. Under these
regulations, mining companies are required to provide a reclamation plan and financial
assurance to insure that the reclamation plan is implemented upon completion of mining
operations. Additionally, Nevada and other states require mining operations to obtain and
comply with environmental permits, including permits regarding air emissions and the
protection of surface water and groundwater.

The Companys compliance with federal and state environmental laws
may necessitate significant capital outlays or delays, may materially and adversely affect
the economics of a given property, or may cause material changes or delays in the
Companys intended exploration, development and production activities. Further, new
or different environmental standards imposed by governmental authorities in the future
could adversely affect the Companys business activities.

PROPOSED LEGISLATION AFFECTING THE MINING INDUSTRY

During the past several years, the United States Congress considered a
number of proposed amendments to the General Mining Law of 1872, as amended (the
"General Mining Law") which governs mining claims and related activities on
federal lands. In 1992, a holding fee of US$100 per claim was imposed upon unpatented
mining claims located on federal lands. Beginning in October 1994, a moratorium on
processing of new patent applications was approved. In addition, a variety of legislation
is now pending before the United States Congress to amend further the General Mining Law.
The proposed legislation would, among other things, change the current patenting
procedures, limit the rights obtained in a patent, impose royalties on unpatented claims,
and enact new reclamation, environmental controls and restoration requirements. The
royalty proposal ranges from a two percent royalty on "net profits" from mining
claims to an eight percent royalty on modified gross income/net smelter returns. The
extent of any such changes that may be enacted is not presently known, and the potential
impact on the Company as a result of future congressional action is difficult to predict.
If enacted, the proposed legislation could adversely affect the economics of development
of operating mines on the federal unpatented mining claims held by the Company because
many of the Companys properties consist of unpatented mining claims on federal
lands. The Companys financial performance could therefore be materially and
adversely affected by passage of all or pertinent parts of the proposed legislation.

UNCERTAINTY OF DEVELOPMENT AND PROPERTY ECONOMICS

Exploration for and production of minerals is highly speculative and
involves greater risks than are inherent in many other industries. Many exploration
programs do not result in the discovery of mineralization, and any mineralization
discovered may not be of sufficient quantity or quality to be profitably mined. Also,
because of the uncertainties in determining metallurgical amenability of any minerals
discovered, the mere discovery of mineralization may not warrant the mining of the
minerals on the basis of available technology.

The Company's decision as to whether any of the mineral development
properties it now holds or which it may acquire in the future contain commercially
mineable deposits, and whether such properties should be brought into production, depends
upon the results of its exploration programs and/or feasibility analyses and the
recommendations of engineers and geologists. The decision will involve the consideration
and evaluation of a number of significant factors, including, but not limited to, the: (i)
receipt of government permits; (ii) costs of bringing the property into production,
including exploration and development work, preparation of feasibility studies and
construction of production facilities; (iii) availability and costs of financing; (iv)
ongoing costs of production; (v) market prices for the metals to be produced; and (vi)
estimates of reserves or mineralization. No assurance can be given that any of the
development properties the Company owns, leases or acquires contain (or will contain)
commercially mineable mineral deposits, and no assurance can be given that the Company
will ever generate a positive cash flow from production operations on such properties.

UNCERTAINTY OF TITLE

A majority of the Company's properties consist of unpatented mining
claims, which the Company owns or leases. These claims are located on federal land or
involve mineral rights that are subject to the claims procedures established by the
General Mining Law. Under this law, if a claimant complies with the statute and the
regulations for the location of a mining claim or mill site claim, the claimant obtains a
valid possessory right to the land or the minerals contained therein. To preserve an
otherwise valid claim, the claimant must also make certain additional filings with the
county in which the land or mineral is situated and with the Bureau of Land Management and
pay an annual holding fee of $100 per claim. If a claimant fails to make the annual
holding payment or make the required filings, the mining claim is void or voidable.

Because mining claims are self- initiated and self-maintained rights,
they are subject to unique vulnerabilities not associated with other types of property
interests. It is difficult to ascertain the validity of unpatented mining claims from
public property records and, therefore, it is difficult to confirm that a claimant has
followed all of the requisite steps for the initiation and maintenance of a claim. The
General Mining Law requires the discovery of a valuable mineral on each mining claim in
order for such claim to be valid, and mining claims may be challenged by rival mining
claimants and the United States. Under judicial interpretations of the rule of discovery,
the mining claimant has the burden of proving that the mineral found is of such quality
and quantity as to justify further development, and that the deposit is of such value that
it can be mined, removed and disposed of at a profit. The burden of showing that there is
a present profitable market applies not only to the time when the claim was located, but
also to the time when such claim's validity is challenged. It is therefore conceivable
that, during times of falling metal prices, claims that were valid when they were located
could become invalid if challenged.

Title to unpatented claims and other mining properties in the western
United States typically involves certain other inherent risks due to the frequently
ambiguous conveyance history of those properties, as well as the frequently ambiguous or
imprecise language of mining leases, agreements and royalty obligations. No generally
applicable title insurance is available for mining. As a result, some of the titles to the
Company's properties may be subject to challenge.

MINING RISKS AND INSURANCE

The Company's operations are subject to all of the operating hazards
and risks normally incident to exploring for and developing mineral properties, such as
unusual or unexpected geological formations, environmental pollution, personal injuries,
flooding, cave-ins, changes in technology or mining techniques, periodic interruptions
because of inclement weather and industrial accidents. Although the Company currently
maintains insurance within ranges of coverage consistent with industry practice to
ameliorate some of these risks, no assurance can be given that such insurance will
continue to be available at economically feasible rates, or that the Company's insurance
is adequate to cover the risks and potential liabilities associated with exploring, owning
and operating its properties. Insurance against environmental risks is not generally
available to the Company or to other companies in the mining industry.

UNKNOWN ENVIRONMENTAL LIABILITIES FOR PAST ACTIVITIES

Mining operations involve a potential risk of releases to soil, surface
water and groundwater of metals, chemicals, fuels, liquids having acidic properties and
other contaminants. In recent years, regulatory requirements and improved technology have
significantly reduced those risks. However, those risks have not been eliminated, and the
risk of environmental contamination from present and past mining activities exists for
mining companies. Companies may be liable for environmental contamination and natural
resource damages relating to properties, which they currently own or operate or at which
environmental contamination occurred while or before they owned or operated the
properties. However, no assurance can be given that potential liabilities for such
contamination or damages caused by past activities at these properties do not exist.

DEPENDENCE ON KEY PERSONNEL

The Company is dependent on the services of certain key executives,
including Michael R. Fitzsimonds, President and Chairman of the Board of Directors; and
Steven D. Craig Vice President and Director. The loss of any of these individuals could
have a material adverse effect on the Company's business and operations. The Company
currently does not have key person insurance on these individuals.

RISKS ASSOCIATED WITH POSSIBLE ACQUISITIONS

The Company periodically considers the acquisition of mining claims,
properties and businesses. In connection with any such future acquisitions, the Company
may incur indebtedness or issue equity securities, resulting in dilution of the percentage
ownership of existing stockholders. The Company intends to seek stockholder approval for
any such acquisitions only to the extent required by applicable law, regulations or stock
market listing rules.



Item 2. - PROPERTY

DETAILED PROPERTY DESCRIPTIONS

Nevada

The following sections describe the existing exploration projects found
in Nevada that are owned or controlled by the Company. The Companys most important
property assets include the Contact copper property and the Borealis gold property. Other
properties and assets are listed at the end.

CONTACT PROJECT, ELKO COUNTY, NV

Summary:

The Contact copper-silver project is located in northeastern Nevada
over a large mineralized granodiorite and altered sedimentary rocks. The property has been
explored by early prospectors beginning in about 1870 with modern exploration being
initiated in about 1967. This work along with drilling completed by Golden Phoenix in 1998
has produced an indicated copper-silver resource calculated to contain about 39.5 million
tons averaging 0.952 percent copper at a 0.2% cutoff grade for 752 million pounds of
copper. A drilling and trench sampling program was completed in early 2000, and results
have not been incorporated into a new resource estimate.

Internal to the Banner deposit is several continuous high-grade zones
that range from five to forty feet wide. Using a 3% cutoff grade on these zones, Golden
Phoenix calculated an indicated resource of 1.2 million tons of 5.72% silver-copper
equivalent for a total of 111 million pounds of copper and 2.15 million ounces of silver.
In summary, the deposit has considerable potential for expanding both open-pittable and
underground ore reserves. Ore types include SX-EW leaching of shallow oxide ores and
milling and concentrating the high-grade sulfide ores for smelting at another facility.

Additionally, other areas on the property have visible copper
mineralization that has not been previously explored. These highly prospective areas offer
tremendous potential for discovery of other valuable copper-silver deposits.

Location and Land:

The Contact copper-silver project is located in the favorable mining
state of Nevada. The property covers about eleven-square miles and is controlled by both
152 patented and 131 unpatented mining claims. The best mineralization is located on the
private patented claims, which Golden Phoenix controls through agreements with
International Enexco Limited and F. W. Lewis, Inc. These private lands are much easier to
permit a new mining operation than the unpatented claims and are extremely valuable to
success of the project. The unpatented claims owned by Golden Phoenix fill fractions and
surround the important patented claims.

History of District:

Copper mineralization was discovered in the area in 1870, and the first
copper showings to be prospected by shafts were east of the Salmon Falls River near China
Mountain, approximately eight miles east of Contact. Sporadic prospecting, staking,
development and production took place from 1876 to 1908 when the population of Contact
reached 300 people. In 1918 work on the Vivian tunnel was started near the Banner Zone
immediately north of the old town of Contact. Subsequently the Gray Mining Company drove
the Helen B. Smith adit to 2300 feet under the Mammoth area.

Copper production from the district peaked during World War I, again in
1928 and during World War II. Production was derived from ten to fifteen different
workings, mainly from the area north and west of Contact. An unofficial estimate in 1970
puts the overall production from the Contact district at 300,000 tons of ore at a grade of
5% Cu (30 million pounds of copper). A partial estimate for the period 1918-1949 was
34,404 tons @ 4.85% Cu, 0.2 oz Au/t and 1.7 oz Ag/t.

Historical records state that 129 shipments from the Marshall (Delano)
Mine in 1928 averaged 5.3% Cu. Palo Alto, also in this zone, produced 300 tons at 32% Cu
before 1910 and 1,400 tons at 5% Cu between 1910 and 1928. Blue Bird ores contained from
15% to 35% Cu, 20 opt Ag and $20 in gold per ton. These workings were located mainly along
the northern contact of the batholith with Paleozoic sediments, and just northwesterly of
the town of Contact. Production came mainly from veins that are near the contact in the
north contact zone, starting at the old Contact town site and running for about four miles
to the west. Concentrate was shipped to Asarcos Garfield (Utah) smelter, which
closed down in 1959. From 1959 to 1967 the district was largely inactive.

Modern Exploration History:

In 1967 Calta and other companies started modern exploration programs
for copper. Work concentrated along the north contact zone, west of the town of Contact.
By 1970 Calta had completed geological mapping, IP surveys, trenching and 37,000 feet of
diamond drilling. That same year a feasibility study was completed on the copper deposits
of Caltas property. Coralta Nevada Inc., a subsidiary of Vancouver-based Coralta
Resources Ltd., took over the Calta property and carried out additional diamond drilling,
IP-surveys, trenching, geological mapping and petrographic work.

From 1973 to 1975 the property was under option to Phelps Dodge
Corporation and work during this period included IP-surveys and diamond drilling of
sixteen holes. Significant fissure vein-, fracture filling- and disseminated-type
copper-molybdenum mineralization with gold and silver values was encountered in several
holes. Their work along with Coralta delineated 8 million tons of mineralization averaging
2.3 per cent copper.

From 1977 to 1989 the property lay essentially dormant, and Enexco
International Inc. acquired many of the patented claims. The majority of the unpatented
claims were allowed to lapse during this period. Interest in the property and its
potential for large tonnage porphyry-type copper-molybdenum mineralization was awakened
again in 1989 when Enexco staked much of the mineralized trend along the north contact
zone of the batholith.

In early 1998 Golden Phoenix Minerals staked 216 unpatented mining
claims that cover approximately 4320 acres of BLM administered lands and established a
buffer around and covered gaps between the land positions of International Enexco Limited
and the F. W. Lewis, Inc. The company acquired the right to earn a 60 percent interest in
the Enexco patented mining claims through a combination of work commitments and payments
over seven years. In July the Company signed a separate exploration license and purchase
option (License/Option) for the SF Lewis Contact Project. The License/Option was acquired
for payments of cash and common stock over the four and one-half year option term.

Golden Phoenix Minerals received encouraging assay results from the
17-drill hole (9445 feet total) program completed in July 1998 at the Contact property.
Results of the drilling program by the Company raised a portion of the combined resource
(mineral inventory) from a drill-inferred to the drill-indicated category. The physical
area of the resource has also been expanded as a result of this program. These encouraging
results and the mineralization that crops out along strike for greater than one mile was
justification for the Company to plan a 1999 drilling program.

In late 1999 the Company completed a 16-hole drilling program for a
total of 5030 feet. Nine of these holes were drilled into the western portion of the
Banner zone, while seven holes tested three new targets to the north and east of the
Banner zone. Drill assays returned good to excellent results from the western extension of
the Banner zone and the previously undrilled Brooklyn and Bluebird targets. Overall,
mineralization was extended another 400 feet to the west along the Banner mineralized
zone, which is now over 4000 feet in strike length. These results justify planning a
drilling program for 2000.



Geology:

The Contact mining district lies within the Paleozoic miogeosyncline.
This thick sequence of sedimentary rocks has been domed and tilted by the intrusion of a
Jurassic granodiorite stock. The stock is 16 miles long in an east-west direction and 8
miles wide. Sediments within 2,000 feet of the stock have been metamorphosed to skarn and
hornfels. Volcanic flows, tuffs, and lake sediments overlie these rocks.

The mineral deposits of the district occur principally in the contact
zone of the granodiorite and within the granodiorite in association with alteration zones.
The two main areas of mineralization are the "north contact zone" and the
"west contact zone" in the western segment of the granodiorite. The "north
contact zone" extends from the town of Contact for seven miles to the west along the
contact and the "west contact zone" extends along the western contact of the
batholith for approximately four miles in a NS-direction. Both zones are at least one-mile
wide, and the Contact property is located on the "north contact zone". Copper is
the main commodity, but the deposits also contain some gold and silver, and locally enough
lead to be of value.

1998 Drilling Results:

The Company has received encouraging assay results from the 17-drill
hole, 9445 feet, program completed in July 1998 at the Contact property. Preliminary
results of the current drilling program by Golden Phoenix Minerals have raised a portion
of the combined resource (mineral inventory) from a drill-inferred to the drill-indicated
category. The physical area of the resource has also been expanded as a result of this
program. These encouraging results and the mineralization that crops out along strike for
greater than one mile are justification for the Company to plan a Phase II drilling
program.

Drilling results in the Delano area (Holes CRC-98-8) have extended and
confirmed mineralization encountered in earlier drill programs (both along strike and
down-dip). The drill holes in the West Extension area (CRC-98-9 through CRC-98-13, and
CRC-98-17) indicate that mineralization is open to the west and down-dip. Drilling results
in the Palo Alto area (Holes CRC-98-14 through CRC-989-16) showed lower grade
mineralization and appear to indicate a weakening of the main Delano structures to the
east.

Copper Resource:

Golden Phoenix Minerals completed its initial evaluation of the Banner
Fissure zone on October 20, 1998. This work included 17 reverse circulation drill holes
for a total of 9,400 feet of new drilling. The drill program augments and expands the
known mineral inventory defined by 61 core holes drilled in the 1960s and 1970s. The
previous drilling totaled over 60,000 feet.

The Company completed three types of mineral inventories from the data
compiled; 1) a manual cross-sectional inventory based on composite samples, 2) a block
model mineral inventory and 3) a preliminary economic dipper pit resource. The following
table shows the comparison of the cross-sectional model and the block model mineral
inventory.

Source
    Tons
    Percent Cu
    Pounds of CuCross-Sectional Model
    39.5 million
    0.952
    752 millionBlock Model
    51.4 million
    0.703
    723.6 million


The final evaluation completed in this study was the development of a
preliminary economic pit. The floating cone was run on the model at a series of copper
prices to get an idea of the sensitivity to price. These sensitivities to price are needed
when capitalization of the project is included to determine profitability. The preliminary
capital cost, quoted but not confirmed, is approximately $28 million for processing plant
and $15 to $20 million for mining equipment. Our work evaluated several copper prices; the
results of two of the floating cones are presented in the following table.

Copper Price
    Tons Ore
    Cu Grade %
    Strip Ratio
    Net Revenue$0.75
    14.7 million
    0.752
    3.6 to 1
    $48 million$1.00
    27.9 million
    0.672
    4.6 to 1
    $140.8 million


The floating cone was based on a mining cut off of 0.2% Cu, waste cost
of $0.75, ore cost of $1.85, processing cost of $0.18 and a pit slope of 45 degrees.

The deposit is still open on three sides and considerable potential
exists to increase the size of the overall deposit and economics of a potential mine.
There are three additional targets on the property to be tested. All these features give
the Company very strong encouragement that the Contact Banner zone is an economic mine for
the company.

1999 Drilling Program:

The Company initiated the 1999 drilling program in late December of
1999 and completed it late January 2000. Sixteen holes were drilled for a total of 5,035
feet into the Banner zone and three previously untested targets. Nine of these holes were
drilled into the western portion of the Banner zone, while seven holes tested the
Brooklyn, Allan and Bluebird targets to the north and east of the Banner zone.

Overall, drill assays returned good to excellent results from the
western extension of the Banner zone and the previously undrilled Brooklyn and Bluebird
targets. Overall, mineralization was extended another 400 feet to the west along the
Banner mineralized zone, which is now over 4000 feet in strike length. Highlights of the
Banner drilling program include hole #3 which returned 140 feet of 0.37% copper beginning
at 90 feet, and hole #11 with 90 feet of 0.32% copper starting at the surface. In the
newly discovered Brooklyn zone, hole #6 intercepted 85 feet of 1.02% copper beginning at
15 feet and hole #7 returned 215 feet of 0.504% copper beginning at 10 feet. Both holes
contained additional mineralized intervals deeper in the holes. In the new Bluebird zone,
hole #15 returned 50 feet of 0.41% copper beginning at the surface. This hole and nearby
hole #16, which contained numerous short intervals of copper mineralization, suggests that
Bluebird could develop into a significant resource with further drilling.

Metallurgical work was completed from samples taken from two other
targets found three miles to the west and one mile to the southwest. Samples from several
mine dumps were collected, crushed, and placed into separate leach columns. A weak
sulfuric acid solution was circulated and measured for 63 days, which resulted in
projected recoveries of 88% in one sample and 82% in the second. These results suggest
that copper mineralization hosted in granodiorite rocks can be readily leached. This work
provides strong support for drilling in these highly prospective areas.

Channel sampling of all the old trenches is nearing completion and new
metallurgical work is currently underway. The company plans to incorporate this new work
into a revised resource assessment of the Banner zone in the coming few months. The
company expects this work to add significant copper resource to the Banner deposit once a
new resource study is completed.

BOREALIS PROJECT, MINERAL COUNTY, NV

Summary:

The Borealis gold-silver property lies with the Aurora-Borealis mineral
belt in west central Nevada. The property was previously mined from eight pits and
produced 10.7 million tons of gold ore at an average grade of 0.059 ounces per ton of gold
for 635,000 ounces of gold.

Mining was terminated in 1991, even though the operating company knew
that the property still had numerous unmined deposits. In 1997 an independent resource
study identified an indicated oxide and sulfide gold resource totaling nearly 1.2 million
ounces of gold remaining unmined. The total tonnage identified in this study was 37.6
million tons averaging 0.032 ounces per ton from several sources.

Currently, Golden Phoenix Minerals, Inc is reworking the drill-hole
database and has developed significant results. The Company has identified a minimum of
20,768,000 tons averaging 0.057 ounces gold per ton containing 1,182,600 ounces of gold
and 0.26 ounces of silver per ton containing 5,477,600 ounces of silver from the Polaris,
Borealis, Freedom Flats and Graben target areas. Furthermore, in the four target areas
studied, numerous areas of open mineralization were evident, and the overall resource will
increase once step-out drilling is performed.

Location, Land, Operating Interest:

Golden Phoenix Minerals, Inc. holds a 68% lease-hold interest in the
property, which is located approximately 12 miles southwest of the town of Hawthorne in
the Walker Lane Mineral Belt. The property lies at approximately 7100 feet on the western
side of the southern Wassuk Range. The current land position consists of 268 unpatented
mining claims encompassing approximately 5,360 acres.

The company originally acquired a 65% interest in the Borealis lease
from J. D. Welsh & Associates in late 1997. At that time the property was joint
ventured with Quebec-based Cambior Exploration USA Inc., but they dropped out at the end
of 1998 as a result of internal budget cuts. The Company recently increased its leasehold
interest in the project three per cent to 68% by diluting the portion owned by J. D. Welsh
and Associates. The company previously was buying Welshs interest, but had to defer
completing the entire purchase due to budgetary constraints in 1998. Further, Golden
Phoenix recently learned that Welsh had optioned his 32% leasehold interest to Newmex
Minerals Inc. Golden Phoenix is not affected by this change in ownership as the Company
controls all aspects of the project including management, planning and budgeting. The
property is subject to a small net smelter return royalty when mine production is
achieved.

History:

The Borealis mine was put into production in 1981 by Tenneco Resources
as a low-cost oxide heap-leach mining operation. Tenneco Resources and its successor, Echo
Bay Minerals, Inc., produced more than 600,000 ounces of oxide gold from Borealis with an
average grade of 0.059 ounce per ton (opt) gold. The sulfides were never mined, although
significant resources were encountered. After mine closure, Santa Fe Pacific Gold Corp.
conducted additional sulfide exploration and development on the property. More recently,
J. D. Welsh & Associates and Golden Phoenix Minerals joint ventured the property with
Cambior. Cambior was the operator of the property, and was earning a 70 percent interest
in the project by spending US$7 million over seven years. Cambior terminated the joint
venture agreement effective December 31, 1998 due to internal budget cuts.

Geology:

The Borealis property hosts a volcanic-hosted epithermal gold system
marked by large areas of silicification, hydrothermal brecciation and advanced argillic
alteration. The stratigraphy consists of primarily Tertiary andesite flows and tuffs. The
gold deposits are structurally controlled along a series of northeasterly-trending normal
faults that dip steeply to the northwest. Gold occurs as submicron-size particles in
highly altered andesite and tuff. Fissure-type quartz veining is not present. The average
silver to gold ratio has been reported to be five to one.

Gold Resources and Mineralized Zones:

The Borealis property can be divided into three separate mineralized
zones and these are called Borealis, Polaris and Cerro Duro. The Borealis zone has three
separate targets, of which two were previously mined. These targets include the Borealis
mine proper, Freedom Flats mine, and Graben. The second mineralized zone is Polaris, and
it consists of Northeast Ridge, East Ridge, and Polaris targets. All three areas were
previously mined and mineralization is found over 12,000 feet along the entire length of
this zone. The third zone is the Cerro Duro and it consists of Jaimes Ridge, Cerro Duro
proper and Purdys Peak. The first two targets were mined. The property also has a
number of remaining areas that have not been properly explored. Currently, the Company is
continuing to build a new digital data spread sheet and is calculating new resource
numbers using Meds system software. The following is what we know about the property.

Golden Phoenix Calculated Resources:

For the sake of the current resource evaluation, the Company had
previously divided the property into two mineralized zones called the Polaris and Borealis
zones. Each zone has three target areas outlined. Golden Phoenix is currently calculating
measured gold resources for each area. The areas will be evaluated in the following order
by target named Polaris, Borealis Pit area, Graben, Freedom Flats, East Ridge, North
Borealis and Northeast Ridge

The first study area chosen was on the Polaris zone, which hosts gold
mineralization along its entire 12,000 foot length. The initial target area was the
Polaris, which is one of three in the Polaris zone, the other two are named East Ridge and
Northeast Ridge. All three were partially mined with gold mineralization left in the pit
walls, floor and along extensions. By reworking the data available on the Polaris target,
Golden Phoenix identified a remaining near surface oxide resource of 1.54 million tons
containing about 37,000 ounces of gold averaging 0.024 ounces per ton and 630,000 ounces
of silver averaging 0.41 ounces per ton. The previous mine operators removed only 250,000
tons of ore and produced about 9,500 ounces of gold from this same zone.

The second target to be evaluated is the remaining gold resource
adjacent, below and within the previously mined Borealis open pit. Production in the early
1980s from this pit is reported to be 1,488,000 tons grading 0.103 ounces of gold per ton
for 152,760 ounces of gold. Golden Phoenix's resource evaluation determined that 2,766,800
tons containing 153,000 ounces of gold and averaging 0.055 ounces per ton gold remain in
the Borealis target area. This deposit also contains 533,600 ounces of silver grading 0.19
ounces per ton. Numerous drill intercepts require step out drilling from open ore
intercepts. This drilling will add additional ounces of gold to the resource.

The third and most important target evaluated to date was the Graben,
located to the west and northwest of the Freedom Flats open pit. The Graben area was
chosen due to its potentially large size and the many high-grade gold assays in the drill
records. The study on the Graben area identified a minimum of 6,642,000 tons grading 0.067
ounces per ton gold for a total of 445,000 ounces of gold and 1,328,500 ounces of silver
grading 0.20 ounces per ton of measured drill indicated mineralization. This deposit was
not previously mined.

The fourth target to be evaluated was Freedom Flats, which previous
mine operators had produced 1,220,000 tons of ore grading 0.16 ounces per ton for 195,220
ounces of gold. During the Company's resource study of Freedom Flats, it decided to change
its approach to the way it evaluated the available drill data. Previously, the Company had
only reported a category of mineralization recognized in the mining industry as Measured
Mineral Resource. This category is where tonnages, shape, grade and mineral content can be
estimated with a high level of confidence based on closely spaced drill holes. The Company
then decided to report a second category of mineralization called Indicated Mineral
Resource, which mineralization can be estimated with a reasonable level of confidence
based on drill holes that are spaced closely enough for continuity to be assumed.

The Freedom Flats resource study concluded that the measured resource
was 1,702,000 tons grading 0.063 ounces of gold per ton for 107,800 ounces of gold and
0.053 ounces per ton silver for 989,800 ounces of silver. The indicated resource was
calculated to be 722,000 tons grading 0.05 ounces per ton of gold for 36,000 ounces of
gold and 0.55 ounces of silver per ton for 399,500 ounces of silver. In total, the deposit
contains 2,425,000 tons grading 0.059 ounces per ton gold for 143,900 ounces of gold and
0.55 ounces per ton silver for 1,389,000 ounces of silver.

Once the Company completed the Freedom Flats resource study, it further
reevaluated the Graben, Borealis and Polaris targets for both Measured and
Indicated Mineral Resource categories. The following table summarizes this new work.

Measured
    Tons
    Au Grade
    Au Oz
    Ag Grade
    Ag OzGraben
    6,404,000
    0.06
    433,600
    0.21
    1,363,400Freedom
    1,702,000
    0.063
    107,800
    0.053
    989,800Borealis
    2,896,000
    0.042
    122,300
    0.022
    630,500Polaris
    1,540,000
    0.024
    37,000
    0.41
    630,000


Indicated
    Tons
    Au Grade
    Au oz
    Ag Grade
    Ag OzGraben
    5,934,000
    0.067
    394,700
    0.20
    1,176,000Freedom
    723,000
    0.05
    36,100
    0.55
    399,500Borealis
    1,569,000
    0.033
    51,100
    0.18
    288,400PolarisTotals
    20,768,000
    0.057
    1,182,600
    0.264
    5,477,600


The four studies completed to date, Polaris, Borealis, Freedom Flats
and Graben, have identified a minimum of 20,768,000 tons averaging 0.057 ounces gold per
ton containing 1,182,600 ounces of gold and 0.264 ounces of silver per ton containing
5,477,600 ounces of silver. Furthermore, in the four target areas studied, numerous areas
of open mineralization were evident and the overall resource will increase once step-out
drilling is performed. All mineralization reported to date is measured and indicated from
drill hole cross sections.

Whitney & Whitney 1997 Gold Resource Evaluation:

A detailed resource evaluation was completed in 1997 by Whitney and
Whitney, Inc., a Reno-based mining consulting firm, which attempted to quantify all
remaining areas of gold mineralization on the Borealis property. This study calculated
remaining gold resources in the old pits, undeveloped deposits, waste dumps, and tailings.
The following table summarizes this work.

Oxide
    Tons
    Grade
    Contained OuncesMeasured
    16,761,272 tons
    0.0207 opt Au
    347,098 ouncesDrill Suggested
    19,431,505 tons
    0.0284 opt Au
    551,556 ounces36,192,777 tons
    0.0248 opt Au
    898,654 ouncesSulfideMeasured
    1,025,000 tons
    0.2167 opt Au
    222,166 ouncesDrill Suggested
    450,000 tons
    0.1667 opt Au
    75,000 ounces1,475,000 tons
    0.2015 opt Au
    297,166 ouncesTotal
    37,667,777 tons
    0.0317 opt Au
    1,195,820 ounces


The four targets studied to date contain 55% of the Whitney &
Whitney estimated tonnage, 98% of the gold and more than 5 million ounces of silver. One
target remains to be studied in the Borealis zone and two target areas remain to be
studied in the 12,000 foot long Polaris Zone and are now expected to bring the measured
gold resource at Borealis significantly above the 1.2 million ounces in the Whitney &
Whitney estimate.







ALASKA

Background:

The Company had originally focused on Nevada and Alaska following its
formation in 1997. Its activities were fairly aggressive in that it acquired numerous
properties in both states. In late 1998 the Company created an Alaskan subsidiary to
enable it to better focus on its two separate regions. In September of 1999 the Company
sold its interests in the Alaskan company to Great American Minerals and Exploration in
order to complete its restructuring and to better focus on its Nevada properties. As part
of the sale, the Company retained the Cirque joint venture with Camnor Resources, and it
also retained the important royalties in the Uncle Sam joint venture with Kennecott
Exploration, the Glory Creek joint venture with Camnor Resources, and any other property
retained in Alaska by Great American Minerals. The Company is carried on any financial
obligations in Alaska and no work is required on the part of Golden Phoenix Minerals in
the coming year.

Cirque Project

The Cirque property is located in the Bonnifield District, 80 miles
south of Fairbanks, Alaska. The Company originally located the property in 1997 and in
early 1998 joint ventured the property with Camnor Resources of Vancouver, British
Columbia. They assumed the role of manager of the venture and made certain commitments to
earn into the property. As of March 20, 2000 Camnor notified Golden Phoenix that they were
terminating their interests in the property and were returning it to Golden Phoenix

Legal Agreement Summary

The joint venture with option to purchase agreement with Camnor
Resources was terminated on March 20, 2000, whereby they return all rights to Golden
Phoenix.

Cirque Exploration:

Exploration work to date has indicated the Cirque property is underlain
by highly prospective stratigraphic horizons in which volcanogenic massive sulfide (VMS)
mineralization occurs. Camnors 1999 exploration program consisted of geological
mapping and reconnaissance diamond drilling. Six drill holes totaling 963 feet were
completed on the Discovery and Dol zones. The best intersections were from hole 99-1 from
the Discovery zone: 17.1 feet grading .083 opt Au, 2.17 opt Ag and 11.55% combined
Zn/Pb/Cu, with a second lens intersecting 6.2 feet grading .0266 opt Au, 1.4 opt Ag and
11.49% combined Zn/Pb/Cu.

Four holes tested the Discovery zone. Three of the holes, drilled on
section, tested the zone at down-dip depths of 31, 80 and 136 feet. The fourth hole tested
the zone approximately 77 feet to the east at the same elevation as hole 99-1.

Incorporating surface and drill data, the Discovery zone is interpreted
to be a west striking, moderately north-dipping zone plunging shallow to the east. The
zone has been traced along strike for 145 feet and down-dip for 120 feet. The Discovery
zone remains open along strike and dip. The favorable horizon hosting the Discovery zone
has been traced to the northwest for over 2170 feet, to the JA showing. To the east the
horizon is overburden covered and plunges into the hillside. It is interpreted that Hole
99-3 was drilled under the plunge of the main mineralized zone. Hole 99-4 intersected a
zone of leached sulfide due to surface weathering that corresponds with the zone.

Based on the limited data, the zone increased in grade and thickness
with depth. The intersection of significant precious metal values together with combined
base metal values in excess of 11% in the 1999 reconnaissance program successfully
demonstrate the projects potential economic viability. Presently all the data is
being compiled and follow up drilling is being planned.

Alaskan Royalties

The Company has retained a one- percent net smelter return royalty on
the following properties.

1. Glory Creek. This property is under a joint venture with an option to purchase with
    Camnor Resources. It is located in the Bonnifield District and to the north of Cirque.
    Exploration work on the property has defined an anomalous zone of gold mineralization that
    requires drilling for the next phase of work.
2. Uncle Sam. This property is currently under joint venture with Kennecott Exploration
    Company. The property is located in the Richardson District about 60 miles southeast of
    Fairbanks. Their work has defined a gold anomalous zone that requires drilling for the
    next phase of work.
3. Switch Creek-Circle District. This property is currently in control by Great American
    Minerals Co. The property hosts a gold target that requires drilling.

Other Properties in Alaska

The Company transferred the following properties to Great American Minerals and
Exploration and no longer retains an interest other than a possible royalty as discussed
above.

1. CIRCLE PROJECT, ALASKA
2. RICHARDSON DISTRICT, ALASKA
3. BONNIFIELD DISTRICT, ALASKA
4. PAXSON AREA, ALASKA
5. NORTH DELTA PROJECT, ALASKA
6. STONE BOY PROJECT, ALASKA
7. HEALY-CANTWELL, ALASKA

Item 3. - LEGAL PROCEEDINGS

None

Item 4. - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of the Company's shareholders during the fourth
quarter of 1999.



PART II

Item 5. - MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS

(a) The Companys common stock has been traded since August 6,
1997. There was no prior activity. The securities are traded on the over -the-counter
market, and quoted on the NASD Electronic Bulletin Board. The following table sets forth
for the periods indicated the range of high and low closing bid quotations per share as
reported by the over-the-counter market. These quotations represent inter-dealer prices,
without retail markups, markdowns or commissions and may not necessarily represent actual
transactions.

Price per
    ShareHigh
    LowFirst Quarter (January 1,
    1998 -March 30, 1998)
    $1.44
    $0.50Second Quarter (March 30,
    1998 - June 30, 1998)
    $0.81
    $0.18Third Quarter (June 30,
    1998 - September 30, 1998)
    $0.60
    $0.18Fourth Quarter (September
    30, 1998 - December 31, 1998)
    $0.32
    $0.12First Quarter 1999 (January
    1, 1999 - March 31, 1999)
    $0.13
    $0.10Second Quarter 1999 (April
    1, 1999 - June 30, 1999)
    $0.13
    $0.115Third Quarter 1999 (July 1,
    1999 - September 30, 1999)
    $0.13
    $0.08Fourth Quarter (September
    30, 1999 - December 31, 1999)
    $0.23
    $0.09First quarter (January 1,
    2000 through March 22, 2000)
    $0.39
    $0.21


(b) There are in excess of 500 holders of the common and 3 holders of
preferred stock of the Company.

1. The Company has paid no dividends.

Recent Sales of Unregistered Securities

Following is a summary of sales of unregistered securities for the
fourth quarter of 1999. All securities were issued as restricted common shares which are
subject to Rule 144 of the Securities and Exchange Commission. Generally, Rule 144
requires shareholders to hold the shares for a minimum of one year before sale. In
addition, officers, directors and more than 10% shareholders are further restricted in
their ability to sell such shares. There have been no underwriters of these securities and
no underwriting commissions or discounts have been paid.

Shares
    ValueIssued
    ReceivedPrivate placement for cash
    550,000
    $ 55,000Consulting and other
    services
    2,157,610
    205,680Total
    2,707,610
    $260,680


The above transactions qualified for exemption from registration under
Sections 3(b) or 4(2) of the Securities Act of 1933. Private placements for cash were
non-public transactions. The Company believes that all such investors are either
accredited or, either alone or with their purchaser representative, have such knowledge
and experience in financial and business matters that they are capable of evaluating the
merits and risks of the prospective investment.

Item 6. - MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

Summary.

Section 21E of the Securities Exchange Act of 1934 provides a
"safe harbor" for forward-looking statements. Certain information included
herein contains statements that are forward-looking, such as statements regarding
management's expectations about future production and development activities as well as
other capital spending, financing sources and the effects of regulation. Such
forward-looking information involves important risks and uncertainties that could
significantly affect anticipated results in the future and, accordingly, such results may
differ from those expressed in any forward-looking statements made herein. These risks and
uncertainties include, but are not limited to, those relating to the market price of
metals, production rates, production costs, the availability of financing, the ability to
obtain and maintain all of the permits necessary to put and keep properties in production,
development and construction activities and dependence on existing management. The Company
cautions readers not to place undue reliance on any such forward-looking statements, and
such statements speak only as of the date made.

RESULTS OF OPERATIONS

No operational revenue has been generated in the initial development
stage operating period through December 31, 1999. All Company activities have been
directed toward development and exploration activities. The Company has active exploration
properties in Nevada and Alaska..

The Company entered into an agreement on August 21, 1997 with J. D.
Welsh & Associates to purchase an interest in a mineral property, situated in Mineral
County, Nevada, known as the Borealis property ("Borealis Property"). The Welsh
leasehold interest in the Borealis property was in a joint venture with Cambior
Exploration USA, Inc. ("Cambior"). The Company purchased 65% of Welshs
leasehold interest in Borealis during 1998. The purchase was stopped at 65% due to
economic constraints on our operating capital. The joint venture with Cambior was
terminated in December 1998 due to their budget allocations for 1999. The Company, along
with J. D. Welsh & Associates signed a simple joint operating agreement on December
31,1999 which also increased the Company's interest to 68% and defined other
relationships.

Exploration costs have been incurred in connection with just the
properties in Nevada. These costs have been incurred for drilling, the location of mining
claims, and field examinations to determine the potential occurrence of economic
mineralization on the different properties. Other exploration costs include the
compilation of historic data on the properties to assist in the evaluation of the
properties and the planning of further exploration.

Operating expenses totaled $688,901 for 1999, compared to $1,756,259
for 1998. The decrease is due primarily to a cutback in personnel and related overhead
expenses resulting from the lack of capital resources and due to reduced exploration
expenditures on the Alaska properties. These changes resulted in a loss of $712,847 for
1999, compared to a loss of $1,748,675 for 1998.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31,1999, the Company had current assets of $38,085
compared to current liabilities of $828,652. Total current liabilities declined
approximately $100,000 due primarily to the settlement of $177,500 in accounts payable
with common stock. This reduction in current liabilities was partially offset by an
increase in accrued expenses of $46,200 due primarily to accrued management salaries.

During fiscal 1999, liquidity needs were met from: (i) private
placement of 144 restricted shares of $267,500, (ii) issuance of stock to vendors and
employees for goods and services of $430,190, and (iii) conversion of outstanding debt to
common stock of $177,457.

As of December 31, 1999, the company had $4,306 in cash.

The Company anticipates total expenditures for fiscal 2000 for general
and administrative expenses to be approximately $260,000 and for exploration and property
holding cost to be approximately $610,000. Exploration and holding expenditures include
$250,000 for the Lewis Contact Property, $100,000 for the International Enxeco joint
venture, $200,000 for the Borealis project, $50,000 for Nevada land holding cost and
$10,000 for generative exploration. These amounts could increase or decrease
significantly, at any time during the fiscal year, based on exploration results and
decisions about releasing or acquiring additional properties, among other factors.

The Company will continue to explore its remaining properties and
intends to acquire new properties, all with the view to enhancing the value of such
properties prior to possible joint ventures with major mining company partners.

The ability of the Company to satisfy the cash requirements of its
development and operations will be dependent upon future financing. The Company
anticipates that additional financing will be obtained, although no assurance can be made
that funds will be available on terms acceptable to the Company.

INVESTING AND FINANCING ACTIVITIES

The Company is investigating potential financing sources and is in
discussions with potential joint venture partners. In 1999 the Company negotiated a stock
option agreement wherein it has been receiving $20,000 per month in cash, enough to meet
its basic operating needs. The status of this agreement is discussed in Note 15 on page 43
of this report.

The Company is currently offering a convertible debt Private Placement
to raise approximately $1.3 million. The total amount to be raised may change, based on
varying conversion prices set from time to time during the offering period. The offering
is a 5-year note, paying 12% per annum interest on a minimum investment of $10,000. The
Company may call the notes at any time prior to maturity. In that event, the note holders
have thirty days to decide whether to accept cash payment or convert the note to common
stock. Principal and interest on the note can be converted into shares at any time during
the five year note period, at the option of the note holders. The conversion price was
$0.20 per share for the first $405,000 received in January 2000 and is currently set at
$0.30 per share. No assurance can be given that the Company will obtain all of the
financing required to maintain its property positions.

YEAR 2000 ASSESSMENT

The Company has encountered no Year 2000 computer related problems.

Item 7. - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements are attached following Item 13.

Item 8. - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

No change was made in the Company's auditors from the prior year.

To the Company's and its management's knowledge, there is no accounting
or financial disclosure dispute involving any present or former accountant.

PART III

Item 9. - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

I. Summary Information.

The following are the directors and executive officers of the Company:



Name
    Age
    PositionMichael R. Fitzsimonds
    44
    President, DirectorSteven D. Craig
    52
    Vice President, Corporate Secretary, DirectorAllan J. Marter
    52
    DirectorDavid A. Caldwell
    39
    Director


All officers and directors have served in the stated capacities since
the inception of the Company, with the exceptions of Mr. Craig, who became secretary and a
director in September 1998, and Mr. Marter, who became a director in February 1998. For
directors, the term of office is until the next annual meeting of shareholders. For
officers, the term of office is until the next annual meeting of the Board of Directors,
presently scheduled to be held immediately following the annual meeting of the
shareholders.

II. Narrative Information Concerning the Directors and Executive
Officers

Michael R. Fitzsimonds  President, Director

Mr. Fitzsimonds is the President and a Director of the Company. He is
an experienced geological engineer with over 21 years of mining industry work. Previously,
he was with Santa Fe Pacific Gold Corporation for 10 years with responsibilities for all
of Santa Fes initial resource evaluations and due diligence work of all mine
operations and acquisition projects worldwide. Overall, he has experience in the minerals
industry with project development ranging from grass roots exploration, project
development and mine startup. Mr. Fitzsimonds current responsibilities with Golden
Phoenix include handling all administrative aspects of the company, which include SEC
liaison, corporate finance, human relations, as well as directing the current
predevelopment work including all resource evaluations, and assisting in exploration
evaluations.

Steven D. Craig  Vice President, Secretary and Director

Mr. Craig is Vice President, Corporate Secretary and Director. Mr.
Craig is an experienced economic geologist with 25 years of diversified exploration work.
He previously spent 23 years of his career with Kennecott Exploration Company and their
affiliates including Bear Creek Mining Co., BP Minerals America, and RTZ Ltd. His
experience was mostly gained in the western United States as both an exploration geologist
and manager of a successful gold exploration team based in Reno. He also has international
experience in such places as Papua New Guinea, South America, and Mexico. He previously
served as an officer and trustee with the Northwest Mining Association and as President of
the Geological Society of Nevada. Mr. Craigs current responsibilities with Golden
Phoenix include directing all exploration aspects of the Company's projects and assisting
the President with administrative duties as required.

Allen J. Marter  Director

Mr. Marter is a Director and is Chief Financial Officer for Golden Star
Resources in Denver, Colorado. Previously, he was a financial advisor in the mining
industry and Principal of Waiata Resources of Littleton, Colorado. He has over 20 years
experience in the mining industry and previously served as chief financial officer for
several junior exploration and mining companies in Denver and Vancouver. He has been
active in mining industry activities and in 1993 was President of the Northwest Mining
Association. He is also a director of Minera Andes Inc. and Addwest Minerals
International, Limited. Mr. Marter is responsible as an outside director to ensure that
the company achieves success by proper utilization of its resources.

David A. Caldwell  Director

Mr. Caldwell is a Director with professional experience as a geologist
and geophysicist. He has more than 12 years experience in the minerals exploration
industry with work in sulfur, base metal and gold exploration and development. He
previously had roles in project management and development at Santa Fe Pacific Gold
Corporation and Gold Fields Mining Company. He is currently an Officer and Director with
Nevada Pacific Gold (US), Inc. in Elko, Nevada. Mr. Caldwell is responsible as an outside
director to ensure that the company achieves success by proper utilization of its
resources.

Section 16(a) Beneficial Ownership Reporting Compliance

Based on available information, it is believed that all filings with
respect to Section 16(a) are now current. Forms 5 for Mr. Fitzsimonds, Mr. Craig and Mr.
Caldwell were not timely filed. Forms 3 and 5 for Mr. Whitney were not timely filed. A
total of 11 Form 4's, representing 29 transactions, were not timely filed for Mr. Whitney.



Item 10. - EXECUTIVE COMPENSATION.

Summary of Cash and Certain Other Compensation

The following table sets forth information as to the compensation of
the Chief Executive Officer whose compensation for the year ended December 31, 1999 did
not exceeded $100,000:

Long Term CompensationAnnual
    Compensation
    Awards
    Payouts(a)
    (b)
    (c)
    (d)
    (e)
    (f)
    (g)
    (h)
    (i)Name and Principal Position
    Year
    Salary ($)
    Bonus ($)
    Other Annual Compen-sation ($)
    Restricted Stock Award(s)
    Securities Under-lying Options/ SARs (#)(1)
    LTIP Payouts ($)
    All Other Compen-sationCEO Michael Fitzsimonds
    1999
    $60,000(3)
    
    $35,0001998
    $60,000(2)
    
    $35,000
    
    375,0001997
    $30,000
    
    
    
    1,145,000


There is no employee that was paid as much as $100,000 per year in cash
compensation. Executive compensation contracts for the payment of a salary were initiated
in May of 1998. A copy of the base contract is attached as 14.1. The Company has agreed to
pay Mr. Fitzsimonds the sum of $60,000 per year in cash compensation and deferred
compensation of $35,000.

(1) Mr. Fitzsimonds was granted options representing a total of 1,925,000 common shares
in 1997. As part of restructuring the Company's finances, options representing a total of
780,000 common shares were relinquished, leaving a balance of options for 1,145,000 common
shares. In 1998 Mr. Fitzsimonds was granted a replacement option for 375,000 common shares
at $0.69, the fair market value of the stock on the date of grant. In addition to these
options, Mr. Fitzsimonds owns 100,000 shares of convertible preferred stock, which are
convertible at ten shares of common stock for each share of preferred, at a price of $0.10
per common share.

(2) Of the $60,000 in 1998 annual compensation, $30,000 was accrued at December 31,
1998 and remains unpaid as of the date of this report.

(3) Of the $60,000 in 1999 annual compensation, $30,000 was accrued at December 31,
1999 and remains unpaid as of the date of this report.

Option Grants in Last Fiscal Year



Number of
    
    % of TotalSecurities
    Granted toUnderlying
    Employees in
    Exercise or
    ExpirationName
    Options Granted
    Fiscal Year
    Base Price
    DateMichael R. Fitzsimonds
    0
    0%
    $0.00


Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End
Option Values

Options Exercised:

|                       | Shares Acquired |               
|---------------------- | --------------- | --------------
|Name                   | On Exercise(#)  | Value Realized
|Michael R. Fitzsimonds | None            | N/A           



Options Unexercised:

|                       | Number of
    Securities   | Value of
    Unexercised
|---------------------- | -------------------------- | ------------------------
|                       | Underlying
    Unexercised | In-the-Money
    Options
|                       | Options at
    12/31/99    | At 12/31/99             
|Name                   | Exercisable                | Unexercise.             
|Michael R. Fitzsimonds | 2,520,000                  | -0-                     



Item11. -SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT

a) Security Ownership of Certain Beneficial Owners.

The following table sets forth certain data with respect to those
persons known to the Company, as of March 22, 2000, to be the beneficial owners of more
than 5% of the outstanding shares of common stock of the Company:

Amount and Nature of
    Beneficial OwnershipCommon SharesName and
    
    Which May Be
    
    PercentAddress of
    Common Shares
    Acquired Within
    
    ofBeneficial Owner
    Presently Held
    60 days
    Total
    ClassJohn W. Whitney
    4,291,034
    3,950,000
    8,241,034(1)
    27.95%P.O. Box 10725Reno, NV 89510Michael R. Fitzsimonds
    992,550
    2,520,000
    3,512,550(2)
    12.52%3595 Airway Dr., Ste 405Reno, NV 89511FW Lewis Inc.
    1,700,000
    
    1,700,000
    6.66%120 Greenridge Dr.Reno, NV 89509




(1) Included in Mr. Whitney's shares are 930,232 restricted common
shares owned by Whitney & Whitney, Inc.(WWI). Mr. Whitney is president of WWI and
president and more than 10% shareholder of its parent company, Itronics Inc. Mr. Whitney's
options and warrants are at $0.10 per share. If Mr. Whitney exercises all of his remaining
initial options, he will receive warrants to acquire an additional 2,100,000 common shares
at $0.10 per share. These additional shares are not included in the above totals.

(2) Mr. Fitzsimonds has conversion rights on preferred stock for
1,000,000 common shares at $0.10 per share and options for 375,000 common shares at $0.69,
500,000 common shares at $1.05, 395,000 common shares at $3.00, and 250,000 common shares
at $4.00 per share.

b) Security Ownership of Management

The following tables set forth, as of March 22, 2000, certain
information with respect to director and executive officer ownership of common and
preferred stock in the Company:

Common Stock

|Amount and Nature of
    Beneficial Ownership
|---------------------------------------------
|                                             
|Name and                                     
|Address of                                   
|Beneficial Owner                             
|Michael R. Fitzsimonds                       
|3595 Airway Dr., Ste 405                     
|Reno, NV 89511                               
|                                             
|Steven D Craig                               
|3595 Airway Dr., Ste 405                     
|Reno, NV 89511                               
|                                             
|David Caldwell                               
|3595 Airway Dr., Ste 405                     
|Reno, NV 89511                               
|                                             
|Allan Marter                                 
|3595 Airway Dr., Ste 405                     
|Reno, NV 89511                               
|                                             
|All directors and executive                  
|officers as a group                          
|( 4 persons)                                 



(1) Mr. Fitzsimonds has conversion rights on preferred stock for
1,000,000 common shares at $0.10 per share and options for 375,000 common shares at $0.69,
500,000 common shares at $1.05, 395,000 common shares at $3.00, and 250,000 common shares
at $4.00 per share.

(2) Mr. Craig holds options for 344,000 common shares at $0.20, 153,907
common shares at $0.27 and 85,049 common shares at $0.50 per share.

(3) Mr. Caldwell holds options for 55,000 common shares at $0.10 and
70,000 common shares at $0.20 per share.

(4) Mr. Marter holds options for 100,000 common shares at $0.20 per
share.

The following table sets forth certain information as of March 22, 2000
as to the beneficial ownership of the Companys preferred stock by all directors, the
named executive officers, and all directors and executive officers as a group.

Preferred Stock

PercentPreferred
    ofShares
    ClassMichael R. Fitzsimonds
    100,000
    44.4%All directors and executive
    officers as a group( 1 persons)
    100,000
    44.4%




Item 12. - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

Officers and directors have loaned the Company a total of $422,100 as
of December 31, 1999. The notes payable are unsecured and accrue interest at 8% per annum.



Item 13. - FINANCIAL STATEMENTS, EXHIBITS, AND REPORTS ON FORM 8-K

I. List of Financial Statements and Exhibits

1. List of Financial Statements

(a) Consolidated Balance Sheets at December 31, 1999 and 1998

(b) Consolidated Statements of Operations During the Development Stage
for the periods ended

December 31, 1999 and 1998 and Inception (June 2, 1997) to December 31,
1999

(c) Consolidated Statements of Stockholders Equity (Deficit) for
the periods ended December 31,

1999 and 1998 and Inception (June 2, 1997) to December 31, 1999

(d) Consolidated Statements of Cash Flows for the periods ended
December 31, 1999 and 1998 and

Inception (June 2, 1997) to December 31, 1999

(e) Notes to Consolidated Financial Statements

2. List of Exhibits

21 Significant Subsidiaries

II. Reports on Form 8-K

None





INDEX TO FINANCIAL STATEMENTS

AND SUPPLEMENTAL DATA

DECEMBER 31, 1999



Page

FINANCIAL STATEMENTS

Report of Independent Certified Public Accountant
                                          
                                          
                                          
                         23

Consolidated Balance Sheets at December 31, 1999 and 1998
                                          
                                          
                                          
         24

Consolidated Statements of Operations During the Development Stage

for the periods ended December 31, 1999 and 1998

and Inception (June 2, 1997) to December 31, 1999
                                          
                                          
                                          
                           26

Consolidated Statements of Stockholders Equity (Deficit)

for the periods ended December 31, 1999 and 1998

and Inception (June 2, 1997) to December 31, 1999
                                          
                                          
                                          
                           27

Consolidated Statements of Cash Flows for the periods ended

December 31, 1999 and 1998 and Inception (June 2, 1997)

to December 31, 1999
                                          
                                          
                                          
                                          
                                  30

Notes to Consolidated Financial Statements
                                          
                                          
                                          
                                   32

EXHIBITS

21 Significant Subsidiaries
                                          
                                          
                                          
                                          
                        48

STATEMENTS AND SCHEDULES

Schedules not included are omitted for the reason they are not
applicable or not required.







Albright, Persing & Associates, Ltd.

CERTIFIED PUBLIC ACCOUNTANTS

1025 Ridgeview Drive, Suite 300

Reno, Nevada 89509

Report of Independent Certified Public Accountants



To the Board of Directors and Stockholders

Golden Phoenix Minerals, Inc.

We have audited the accompanying balance sheet of Golden Phoenix
Minerals, Inc. (a development stage company) as of December 31, 1999 and 1998 and the
related statements of operations, stockholders equity (deficit), and cash flows for the
year ended December 31, 1999. We have also audited the accompanying consolidated balance
sheet of the Company and its subsidiary as of December 31, 1998, and the related
consolidated statements of operations, stockholders equity (deficit), and cash flows for
the periods ended December 31, 1998 and from inception (June 2, 1997) to December 31,
1999. These financial statements are the responsibility of Golden Phoenix Minerals,
Inc.s management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Golden Phoenix Minerals, Inc.
and its subsidiary at December 31, 1999 and 1998 and from Inception (June 2, 1997) to
December 31, 1999 and the results of its operations and its cash flows for the years then
ended, in conformity with generally accepted accounting principles.

The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note 1, the Companys
ability to generate sufficient cash flows to meet its obligations and sustain its
operations, either through future revenues and /or additional debt or equity financing,
cannot be determined at this time. These uncertainties raise substantial doubt about the
Companys ability to continue as a going concern. Managements plans in regard
to these matters are also described in Note 1. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.



March 20, 2000 /S/ Albright, Persing & Associates, Ltd.



GOLDEN PHOENIX MINERALS, INC.

(A Development Stage Company)

BALANCE SHEETS

DECEMBER 31, 1999 AND 1998



ASSETSConsolidated1999
    1998Current AssetsCash
    $ 4,306
    $ 2,437Prepaid expenses
    2,100
    14,409Employee advances
    25,679
    -Accounts receivable
    -
    1,050Stock subscriptions receivable
    6,000
    6,000Total Current Assets
    38,085
    23,896Options
    25,000
    25,000Joint venture
    1,050,000
    1,050,000Mining properties and claims
    212,291
    260,000Property and equipment, net of accumulateddepreciation of $32,327 in 1999 and$18,143 in 1998
    42,701
    65,108Organization costs, net of accumulatedamortization of $577 in 1999 and$247 in 1998
    578
    808Deposits
    -
    2,300Deferred development costs
    64,217
    -Deferred tax assets, net of valuation
    allowance
    -
    -Total Assets
    $ 1,432,872
    $ 1,427,112


The accompanying notes are an integral part of these financial
statements



GOLDEN PHOENIX MINERALS, INC.

(A Development Stage Company)

BALANCE SHEETS

DECEMBER 31, 1999 AND 1998

LIABILITIES AND STOCKHOLDERS EQUITY
    (DEFICIT)Consolidated1999
    1998Current LiabilitiesAccounts payable
    $ 222,626
    $ 386,836Accrued liabilities
    132,772
    86,567Current portion of capital lease
    obligations
    4,875
    3,981Amounts due to stockholders
    422,100
    422,100Accrued interest stockholder loans
    46,279
    29,333Total Current Liabilities
    828,652
    928,817Long-term LiabilitiesCapital lease obligations
    7,680
    11,051Deferred income taxes
    -
    3,004Total Liabilities
    836,332
    942,872Minority Interests
    -
    50,000Stockholders Equity (Deficit)Preferred stock, no par value, 50,000,000shares authorized and 500,000 sharesissued and outstanding at December31, 1999 and 1998
    2,000
    2,000Common stock, no par value, 150,000,000shares authorized, 24,573,940 and
    16,676,260issued and outstanding at December 31,
    1999and 1998, respectively (including
    5,625,279and 693,176 of 144 restricted shares fororganizational services at December 31,
    1999)
    4,470,122
    3,644,975Additional paid in capital
    50,000
    -Deficit accumulated during the development
    stage
    (3,925,582)
    (3,212,735)Total Stockholders Equity
    596,540
    434,240Total Liabilities and Stockholders Equity
    $1,432,872
    $ 1,427,112




The accompanying notes are an integral part of these financial
statements

GOLDEN PHOENIX MINERALS, INC.(A Development Stage Company)STATEMENTS OF OPERATIONSDURING THE DEVELOPMENT STAGEFOR THE PERIODS ENDED DECEMBER 31, 1999
    AND 1998AND INCEPTION (JUNE 2, 1997) TO DECEMBER
    31, 1999CumulativeDuringDevelopment
    
    ConsolidatedStage
    1999
    1998RevenuesJoint Venture
    $34,400
    $1,700
    $ 32,700Options
    2,000
    -
    2,000Property and claims
    3,000
    3,000
    -39,400
    4,700
    34,700ExpensesExploration
    2,113,811
    396,186
    827,552General and administrative
    1,792,363
    297,403
    928,7073,906,174
    693,589
    1,756,259Loss from Operations
    (3,866,774)
    (688,889)
    (1,721,559)Other Income (Expense)Interest income
    270
    100
    -Interest expense
    (103,506)
    (54,093)
    (44,512)Gain on sale of stock in affiliate
    10,016
    -
    10,016Gain (loss) on sale of fixed assets
    2,551
    (1,400)
    3,951Other income
    10,552
    6,513
    4,039Other expense
    (1,290)
    (680)
    (610)Rent income
    22,599
    22,599
    -Loss Before Provision for Income Taxes
    (3,925,582)
    (715,850)
    (1,748,675)Income Tax Benefit (Expense)Current
    -
    -
    -Deferred
    -
    3,003
    (2,223)-
    3,003
    (2,223)Net Loss
    $(3,925,582)
    $(712,847)
    $(1,750,898)Basic and Diluted Net Loss per CommonShare
    $(.23)
    $(.03)
    $(.12)Shares Used in Computing Basic andDiluted Shares
    16,915,948
    21,079,784
    15,071,719


The accompanying notes are an integral part of these financial
    statementsGOLDEN PHOENIX MINERALS, INC.(A Development Stage Company)STATEMENTS OF STOCKHOLDERS' EQUITYFOR THE PERIODS ENDED DECEMBER 31, 1999
    AND 1998AND INCEPTION (JUNE 2, 1997) TO DECEMBER
    31, 1999AdditionalCommon Stock
    Preferred Shares
    Paid-In
    AccumulatedShares
    Amount
    Shares
    Amount
    Capital
    Deficit
    TotalBalances, June 2, 1997 (date ofinception)
    -
    $ -
    -
    $ -
    -
    $ -
    $ -Issuance of common stock for cash
    10,465,000
    1,139,000
    -
    -
    -
    -
    1,139,000Issuance of common stock forservices - 144 restricted shares
    2,000,000
    2,000
    -
    -
    -
    -
    2,000Issuance of preferred stock forservices - 144 restricted shares
    -
    -
    500,000
    2,000
    -
    -
    2,000Sale of common stock for cash504 exempt
    424,480
    843,657
    -
    -
    -
    -
    843,657Issuance of common stock for jointventure option purchase 144restricted shares
    50,000
    100,000
    -
    -
    -
    -
    100,000Net loss for the period from June 2, 1997through December 31, 1997
    -
    -
    -
    -
    -
    (1,461,837)
    (1,461,837)




The accompanying notes are an integral part of these financial
statements



GOLDEN PHOENIX MINERALS, INC.(A Development Stage Company)STATEMENTS OF STOCKHOLDERS' EQUITYFOR THE PERIODS ENDED DECEMBER 31, 1999
    AND 1998AND INCEPTION (JUNE 2, 1997) TO DECEMBER
    31, 1999AdditionalCommon Stock
    Preferred Shares
    Paid-In
    AccumulatedShares
    Amount
    Shares
    Amount
    Capital
    Deficit
    TotalBalance at December 31, 1997
    12,939,480
    2,084,657
    500,000
    2,000
    -
    (1,461,837)
    624,820Issuance of common stock tovendors and employees for goodsand services
    721,000
    187,000
    -
    -
    -
    -
    187,000Issuance of common stock for stockoptions exercised
    510,000
    109,315
    -
    -
    -
    -
    109,315Issuance of common stock inexchange for debt pay off
    431,486
    383,113
    -
    -
    -
    -
    383,113Issuance of common stock for cash
    1,727,627
    685,890
    -
    -
    -
    -
    685,890Conversion of outstanding debt tocommon stock
    346,667
    195,000
    -
    -
    -
    -
    195,000Net loss for the year ended December31, 1998
    -
    -
    -
    -
    -
    (1,750,898)
    (1,750,898)




The accompanying notes are an integral part of these financial
statements



GOLDEN PHOENIX MINERALS, INC.(A Development Stage Company)STATEMENTS OF STOCKHOLDERS' EQUITYFOR THE PERIODS ENDED DECEMBER 31, 1999
    AND 1998AND INCEPTION (JUNE 2, 1997) TO DECEMBER
    31, 1999AdditionalCommon Stock
    Preferred Shares
    Paid-In
    AccumulatedShares
    Amount
    Shares
    Amount
    Capital
    Deficit
    TotalBalance December 31, 1998
    16,676,260
    3,644,975
    500,000
    2,000
    -
    (3,212,735)
    434,240Issuance of common stock tovendors and employees forgoods and services
    5,522,680
    587,647
    -
    -
    -
    -
    587,647Issuance of common stock inexchange for debt pay off-
    -
    -
    -
    -
    -
    -
    -Issuance of common stock forcash
    2,375,000
    237,500
    -
    -
    -
    -
    237,500Acquisition of Treasury Stock
    (500,000)
    -
    -
    -
    -
    -
    -Sale of Treasury Stock
    500,000
    -
    -
    -
    50,000
    -
    50,000Net loss for the year ended December31, 1999
    -
    -
    -
    -
    -
    (712,847)
    (712,847)Balance December 31, 1999
    24,573,940
    $4,470,122
    500,000
    $ 2,000
    $ 50,000
    $(3,925,582)
    $ 596,540


The accompanying notes are an integral part of these financial
    statementsGOLDEN PHOENIX MINERALS, INC.(A Development Stage Company)STATEMENTS OF CASH FLOWSFOR THE PERIODS ENDED DECEMBER 31, 1999
    AND 1998AND INCEPTION (JUNE 2, 1997) TO DECEMBER
    31, 1999CumulativeDuringDevelopment
    
    ConsolidatedStage
    1999
    1998Cash Flows From Operating ActivitiesNet Loss
    $ (3,925,582)
    $ (712,847)
    $ (1,750,898)Adjustments to reconcile net loss to netcash used in operating activitiesDepreciation and amortization
    45,774
    15,271
    26,341(Loss) gain on sale of fixed assets
    (2,551)
    1,400
    (3,951)Common stock issued for goodsand services
    909,947
    607,647
    200,300Preferred stock issued for goodsand services
    2,000
    -
    -(Increase) in accounts receivable
    (25,679)
    (24,629)
    (1,050)(Increase) Decrease in prepaid expenses
    (2,101)
    12,308
    20,945Decrease in deposits
    -
    2,300
    13,481Increase (Decrease) in accounts payable
    232,626
    (154,210)
    290,946Increase in accrued liabilities
    179,051
    63,151
    93,593(Decrease) in incorporation costs
    (1,155)
    -
    -Fixed assets exchanged for goodsand services
    55,982
    -
    55,982(Increase) Decrease in deferredexploration and development costs
    (64,218)
    (64,218)
    70,967(Increase) Decrease in options
    (25,000)
    -
    15,000Deferred income tax (benefit) expense
    -
    (3,003)
    2,223Net Cash (Used) in OperatingActivities
    (2,620,906)
    (256,830)
    (966,121)Cash Flows (Used) Provided by Investing
    ActivitiesPurchase of property and equipment
    (169,260)
    (5,998)
    (25,127)Proceeds from fixed asset sales
    34,965
    1,965
    33,000Purchase of mining properties and claims
    (212,291)
    (2,291)
    (200,000)Purchase of joint venture
    (550,000)
    -
    -Net Cash (Used) Provided byInvesting Activities
    (896,586)
    (6,324)
    (192,127)Cash Flows From (For) Financing ActivitiesPrincipal payments on capital lease
    obligations
    (4,479)
    (2,477)
    (1,408)Proceeds from notes payable - stockholders
    623,400
    -
    228,400Payments on notes payable - stockholders
    (6,300)
    -
    (6,300)Payments on long-term debt
    (116,887)
    -
    (116,887)Net proceeds from sale of common stock
    3,026,064
    267,500
    775,907Net Cash Provided by FinancingActivities
    3,521,798
    265,023
    879,712Net Increase (Decrease) in Cash
    4,306
    1,869
    (278,536)Cash at Beginning of Period
    -
    2,437
    280,973Cash at End of Period
    $4,306
    $4,306
    $2,437




The accompanying notes are an integral part of these financial
statements

GOLDEN PHOENIX MINERALS, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOWS

FOR THE PERIODS ENDED DECEMBER 31, 1999 AND 1998

AND INCEPTION (JUNE 2, 1997) TO DECEMBER 31, 1999



SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

CumulativeDuringDevelopment
    
    ConsolidatedStage
    1999
    1998Cash Paid for Interest
    $ 26,616
    $ 20,325
    $ 6,080Cash Paid for Income Taxes
    $
         -
    $
           -
    $     -


The accompanying notes are an integral part of these financial
statements



SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:

CumulativeDuringDevelopment
    
    ConsolidatedStage
    1999
    1998Reduction in debt due to renegotiation of
    jointventure contract
    $ 200,000
    $ -
    $ 200,000Common stock issued for debt payment
    383,113
    -
    -Common stock issued for stockholder debtpayment
    195,000
    -
    195,000Common stock issued for joint venture
    purchase
    100,000
    -
    -


The accompanying notes are an integral part of these financial
statements

GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 1 - DESCRIPTION OF BUSINESS AND FINANCING REQUIREMENTS

Organization

Golden Phoenix Minerals. Inc. was incorporated under the laws of
Minnesota on June 2, 1997. The company is engaged in the exploration of minerals and its
primary activities are the exploration and development of precious and base metals in the
western United States and Alaska. Golden Phoenix Minerals, Inc. controls its exploration
properties through ownership, leases, mining claims and joint ventures. The Company is
planning exploration and development of selected properties to positive feasibility. The
Company will also provide joint ventures to other large mining companies.

The Company is in the development stage and has generated little
revenue. It has been funded primarily through stock sales and loans from officers and
shareholders. The Company's prospects are subject to the risks, expenses and uncertainties
frequently encountered in the mining exploration industry. These risks include the
volatility of mineral prices and the ability to explore and develop profitable mining
properties.

The Company has experienced losses since its inception in 1997 and had
an accumulated deficit at December 31, 1999. The Company's ability to accomplish its
business strategy and to ultimately achieve profitable operations is dependent upon its
ability to obtain additional financing and execute its business plan. The Company intends
to have an ongoing program to obtain outside financing for its exploration and development
activities. Failure to raise additional capital when needed could have a material adverse
effect on the Company's business, results of operations and financial condition.
Ultimately, the Company will need to achieve profitable operations in order to continue as
a going concern. The company incurred a net loss of $712,847 and $1,750,898 for the years
ended December 31, 1999 and 1998, respectively, and has an accumulated deficit of
$3,925,582 as of December 31, 1999.

These conditions raise substantial doubt about the Company's ability to
continue as a going concern. The financial statements do not include any adjustments to
reflect the possible future effects on the recoverability and classification of assets or
the amounts and classification of liabilities that may result from the outcome of this
uncertainty.



GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents

Cash and cash equivalents consist of cash balances and instruments with
maturities of three months or less at the time of purchase.

Concentrations

Concentration of Credit Risk - Financial instruments which
potentially subject the Company to credit risk consist primarily of cash in bank. The
Company maintains its cash in a bank deposit account insured by the Federal Deposit
Insurance Corporation (FDIC) up to $100,000. The Company's account at times, may exceed
federally insured limits.

Concentration of Operations - The Company's operations are all
related to the minerals exploration and mining industry. A reduction in mineral prices or
other disturbances in the minerals market could have an adverse effect on the Company's
operations.

During 1998, 94% of the Company's revenues were received from one party
for a joint venture agreement. In 1999, the major source of income was from a sub-lease
agreement.

Financial Statement Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosures of contingent assets
and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ from these
estimates.

Property and Equipment

Property and equipment are stated at cost. Depreciation, which includes
amortization of assets recorded under capital leases, is calculated using the straight
line method over lives ranging from three (3) to seven (7) years.



GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES - Continued

Stock Options

The Company adopted SFAS No. 123, Accounting for Stock Based
Compensation, which is effective for fiscal years beginning after December 15, 1995, or
earlier as permitted. As provided by SFAS No. 123, the Company will continue to account
for employee stock options under Accounting Principles Board (APB) Opinion No. 25,
Accounting for Stock Issued to Employees. The Company has disclosed the proforma net loss
and earnings per share effect as if the Company had used the fair value based method
prescribed under SFAS No. 123 in Note 18.

Property Acquisition and Deferred Mine Costs

Property acquisition and deferred mine costs are recorded at cost. On
the commencement of commercial production, depletion of each mining property will be
provided on the units of production basis using estimated proven and probable reserves as
the depletion basis.

Properties in Development

Upon determination that a mineral property can be economically
developed, costs incurred are capitalized until the assets are put in service, at which
time the capitalized costs are depreciated in accordance with the policies described
above.

Financing costs, including interest, are capitalized on the basis of
expenditures incurred for the acquisition and development of projects, without restriction
to specific borrowings for these projects, while the projects are actively being prepared
for proposed production. Capitalization is discontinued when the asset is ready for its
intended use.

Exploration Properties

Mineral exploration expenditures are expensed as incurred. Property
acquisition costs relating to exploration properties and expenditures incurred on
properties identified as having development potential are deferred on a project basis
until the viability of the project is determined. Costs associated with economically
viable projects are depreciated and amortized in accordance with the policies described
above. If a project is not viable, the accumulated project costs are charged to operations
in the year in which that determination is made.



GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES - Continued



Property Evaluations



The Company reviews and evaluates the recoverability of its properties
when events or changes in circumstances indicate that the carrying amount of a property
may not be recoverable. Estimated future net cash flows, on an undiscounted basis, from a
property are calculated using estimated recoverable ounces of minerals (considering
current proven and probable reserves and mineralization expected to be classified as
reserves); estimated future mineral price realization (considering historical and current
prices, price trends and related factors); and operating, capital and reclamation costs.
Reduction in the carrying value of property, plant and equipment, with a corresponding
charge to earnings, are recorded to the extent that the estimated future net cash flows
are less than the carrying value.



Estimates of future cash flows are subject to risks and uncertainties.
It is reasonably possible that changes in circumstances could occur which may affect the
recoverability of the Company's properties.



Income Taxes



The Company accounts for income taxes by the asset/liability approach
in accordance with the provisions of SFAS No. 109, Accounting for Income Taxes. Under this
pronouncement, deferred income taxes, if any, reflect the estimated future tax
consequences when reported amounts of assets and liabilities are recovered or paid.
Deferred income tax assets and liabilities are determined based on differences between the
financial reporting and tax bases of assets and liabilities and are measured using the
enacted tax rates and laws that are scheduled to be in affect when the differences are
expected to reverse. The provision for income taxes, if any, represents the total income
taxes paid or payable for the current year, plus the change in deferred taxes during the
year. The tax benefits related to operating loss carryforwards are recognized if
management believes, based on available evidence, that it is more likely than not that
they will be realized.

GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES - Continued

Net Loss Per Share

In February, 1997, the Financial Accounting Standards Board issued SFAS
No. 128, Earnings per Share. SFAS No. 128 simplifies the standards for computing earnings
per share (EPS) and was effective for financial statements issued for periods ending after
December 15, 1997, with earlier application not permitted. Upon adoption, all prior EPS
data was restated.

Basic EPS is determined using net income divided by the weighted
average shares outstanding during the period. Diluted EPS is computed by dividing net
income by the weighted average shares outstanding, assuming all dilutive potential common
shares were issued.

Since the fully diluted loss per share for the years ended December 31,
1999 and 1998 was antidilutive, basic and diluted earnings per share are the same.
Accordingly options to purchase common stock at December 31, 1999 and 1998, of 4,096,066
shares, warrants to purchase common stock of 2,150,000 shares and common shares
potentially issuable upon conversion of preferred stock existing at the end of 1999 and
1998 of 5,000,000 shares, were not included in the calculation of diluted earnings per
common share.

New Accounting Standards

In June, 1997, the Financial Accounting Standards Board issued SFAS No.
130, Reporting Comprehensive Income. SFAS No. 130 establishes standards for reporting and
presentation of comprehensive income and its components in a full set of general-purpose
financial statements. This statement does not, however, require a specific format for the
disclosure but requires the Company to display an amount representing total comprehensive
income for the period in its financial statements. Comprehensive income is determined by
adjusting net income by other items not included as a component of net income, such as the
unrealized loss on marketable securities. The Company implemented SFAS No. 130 for the
year ended December 31, 1998. During 1999 and 1998, the Company did not generate
transactions considered part of other comprehensive income.

In June, 1997, the Financial Accounting Standards Board issued SFAS No.
131, Disclosures about Segments of an enterprise and Related Information. SFAS No. 131
establishes standards for the manner in which public business enterprises report
information about operating segments in annual financial statements and requires that
those enterprises report selected information about operating segments in interim
financial reports issued to shareholders. This statement also requires that a public
business enterprise report financial and descriptive information about its reportable
operating segments. The Company has determined that segment disclosures are not
appropriate because the Company operates in only one segment.

In June, 1998, the Financial Accounting Standards Board issued SFAS
133, Accounting of Derivative Instruments and Hedging Activities, however, the effective
date for this pronouncement was delayed for one year from the original effective date of
fiscal years beginning after June 15, 1999. Since the Company does not deal in derivative
instruments or hedging activities, it is anticipated that this pronouncement will have no
impact on the Company's consolidated financial statements.

GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 3 - BUSINESS ACQUISITIONS

Golden Phoenix Alaska, Inc., was incorporated on September 15, 1998
under the laws of the State of Nevada. Golden Phoenix Minerals, Inc. (the Company)
conveyed all of its property interests in Alaska to Golden Phoenix Alaska, Inc., in return
for 2,500,000 shares of stock of which 500,000 shares were resold in 1998.

For the year ended December 31, 1998, results of operations for Golden
Phoenix Alaska, Inc., have been included in the consolidated statements of operations.
Assets acquired have been recorded at historical cost based on the best information
available. In October of 1999, the Company exchanged 100% of its equity ownership
(approximately 72%) in Golden Phoenix Alaska, Inc., for an equity interest in the Cirque
Property (a joint venture with Camnor Resources). The Cirque Property has been recorded at
historical cost and no gain or loss was realized as part of the transaction. As part of
the agreement with Golden Phoenix Alaska, Inc., Dennis McDowell's 500,000 shares in Golden
Phoenix Minerals, Inc., were purchased as Treasury Stock and later resold.



NOTE 4 - OPERATIONS - JOINT VENTURES

The Company generated revenues from the granting of joint venture
positions in part of its Alaska holdings.

On September 19, 1997 the Company entered into a joint venture
agreement with Kennecott Exploration on its High Grade property located in Modoc County,
California. During 1998 the Company incurred $133,986 in exploration work. This project
was abandoned December 1998.

The Company entered into an agreement on August 21, 1997 with J. D.
Welsh & Associates to purchase an interest in a mineral property, situated in Mineral
County, Nevada, known as the Borealis property (Borealis Property). The Welsh interest in
the Borealis property was in a joint venture with Cambior Exploration USA, Inc. (Cambior).
Cambior has elected to terminate the joint venture due to budgetary constraints on their
US exploration program. The Company had the option to purchase all of Welsh's interest in
Borealis over three years for a total of $1,250,000 in payments. The purchase price for
65% ownership in the joint venture was reduced to $1,050,000 in December of 1998 and the
balance has been paid in full. The Company is responsible for 65% of payments to the
underlying owners as of December 1998. The Company is actively seeking a new joint venture
partner for this property.



NOTE 4 - OPERATIONS - JOINT VENTURES - Continued



The Company acquired on September 18, 1997, an option to purchase 100%
of the issued and outstanding stock of F. W. Lewis, Inc. and Mina Gold Mine, Inc.
(Collectively Lewis Companies) for an option payment of $250,000. The option expired
December 31, 1997 and was renewed on January 6, 1998 for an additional $250,000. The Lewis
Companies control in excess of 25,000 acres of mining properties consisting of patented
and unpatented mining claims, patented and unpatented mill sites, and fee lands in Nevada,
Colorado, and certain oil and gas interests in California. The purchase price for the
Lewis Companies and all their real and personal property assets was $20,000,000. The
option to purchase was terminated due to the inability to secure financing for the
$20,000,000 exercise price. F.W. Lewis, Inc., then granted Golden Phoenix Minerals, Inc.
an exploration license granting the Company the exclusive right and license to explore the
property terminating December 31, 2002. The agreement requires stock distributions of
$2,200,000 of Golden Phoenix, Inc., common stock and minimum work requirements totaling
$750,000. During 1999, the Company distributed $200,000 in Golden Phoenix, Inc. common
stock and incurred $387,820 in work requirements.

The Company has retained their interest in the Contact copper property
which is part of the F. W. Lewis portfolio. On January 28,1998 the Company entered into a
joint venture agreement with International Enexco Ltd. (Enexco). The Company has the
option to purchase 60% of the properties and the Contact Venture for a total of $2,600,000
in Work Requirements and $313,000 in payments over a six year period. The company paid
$25,000 in option costs for the agreement in 1998. During 1999, the Company incurred
$387,820 in work requirements and $24,000 in cash and issued 24,000 shares of stock for
mining lease payments.



NOTE 5 - DEFERRED DEVELOPMENT COSTS



During 1999, the Company evaluated their Contact and Borealis
properties and determined, based on identified mine deposits, that these properties are
now in the development stage. Costs incurred after September 30, 1999, will be
capitalized. Such costs will be depreciated upon the commencement of commercial
production.



GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 6 - NOTES PAYABLE TO RELATED PARTIES

Short term notes payable to related parties consisted of the following
amounts at December 31:

1999
    1998Notes payable to stockholders,
    non-interest bearing,interest imputed at 8%, principal and
    unpaidaccrued interest due on demand, unsecured
    $ 422,100
    $ 422,100


The Company incurred related party interest expense of $33,768 and
$24,643 for the years ended December 31, 1999 and 1998, respectively.

NOTE 7 - OPTIONS

The Company had the following options at December 31:

1999
    1998International Enexco Inc. Contact joint
    venture
    $ 25,000
    $ 25,000


NOTE 8 - MINING PROPERTIES AND CLAIMS

The Company had the following mineral rights and claims at December 31:

1999
    1998Mineral rights in Richardson Mining
    District
    $ -
    $ 10,000Mineral rights, claims and options in
    GoldenPhoenix Alaska
    -
    250,000Mineral rights, claims and options in
    CirqueProperty
    212,591
    -$ 212,591
    $ 260,000




GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 9 - PROPERTY AND EQUIPMENT

Property and Equipment consisted of the following at December 31:

1999
    1998Computer equipment
    $ 41,480
    $ 35,482Software (idle)
    -
    10,000Office furniture and equipment
    16,516
    20,737Equipment under capital lease
    17,032
    17,03275,028
    83,251Less: Accumulated Depreciation
    (32,327)
    (18,143)$ 42,701
    $ 65,108


NOTE 10 - ORGANIZATION COSTS

Organization costs are being amortized over five years. The balance at
December 31 is as follows:

1999
    1998Organization costs
    $ 1,155
    $ 1,155Less accumulated amortization
    (577)
    (347)$ 578
    $ 808


Amortization expense for the years ended December 31, 1999 and 1998
amounted to $231 each year.

NOTE 11 - ACCRUED LIABILITIES

Accrued liabilities consisted of the following at December 31:

1999
    1998Accrued payroll and related expenses
    $ 131,916
    $ 79,490Other accrued liabilities
    856
    7,077$ 132,772
    $ 86,567


GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 12 - CAPITAL LEASE OBLIGATIONS

1999
    1998Capital lease payable to IKON Capital
    Resources,dated October 15, 1997, payable at $250.38
    permonth, including interest imputed at 15.2%
    perannum, maturity November, 2002, secured bycertain computer equipment, personallyguaranteed by a shareholder.
    $ 12,555
    $ 15,032Less Current Portion
    (4,875)
    (3,981)Long Term Capital Lease Obligation
    $ 7,680
    $ 11,051


NOTE 13 - COMMITMENTS

Leases

The Company leases its facilities under a non-cancelable operating
lease expiring July 31, 2000. The following is a schedule, by years, of the future minimum
lease payments under operating leases, together with the net minimum lease payments as of
December 31, 1999. The Company leased software for $1,500 per month under an operating
lease which expired December 31, 1998.

Year ending December 31, 2000 $33,439

Rental expense for all operating leases was $53,076 and $70,776 for the
years ended December 31, 1999 and 1998, respectively.

The Company sub-leases a portion of its office space to Whitney &
Whitney, Inc., a related party under a non-cancelable operating lease expiring July 31,
2000. Future sub-lease income is as follows:

Year ending December 31, 2000 $ 17,577

Sub-lease income was $22,599 for the year ended December 31, 1999.

Capital Leases

The Company has computer equipment with a net book value of $9,635
(accumulated depreciation of $7,397) under capital leases at December 31, 1999.

GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 13 - COMMITMENTS - Continued

Minimum future lease payments under the capital leases as of December
31, 1999, is as follows:

Year endedDecember 31,2000
    $ 7,2422001
    4,8282002
    4,02316,093Less: amount representing interest
    (3,538)Present value of minimum lease payments
    $ 12,555


Mining Lease - Borealis Project

The Company leases mining property in Mineral County, Nevada, known as
the Borealis Property as part of a joint venture agreement. The lease is cancelable within
90 days. If the lease were canceled, the joint venture agreement would also be canceled.
Future lease payments as of December 31, 1999 are as follows:

Years EndedDecember 312000
    $ 46,8002001
    54,6002002
    62,400


For years after 2002, the lease continues at $5,200 per month with
adjustments based upon the consumer price index, with no expiration of the lease.

Mining Lease - F.W. Lewis Contact Property

The Company leases mining property in Elko County, Nevada, known as the
Contact Property, as part of a joint venture agreement. The lease is cancelable within 30
days. Future lease payments as of December 31, 1999 are as follows:

Years EndedDecember 31,2000
    $ 30,0002001
    30,0002002
    30,000




GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 14 - STOCKHOLDER'S EQUITY

Common Stock

As of December 31, 1999, the Company has reserved a total of 4,096,066
shares of common stock pursuant to outstanding stock options. Options to purchase
1,095,642 common shares were exercised during 1998 at an average price of $.11 per share.
Options to purchase 465,000 common shares were exercised during 1997 at an average price
of $2.14 per share. No options were exercised during 1999.

Preferred Stock

The authorized number of preferred shares is 50,000,000 of which
500,000 of section 144 restricted shares were issued and outstanding as of December 31,
1999. Preferred stock is convertible to ten restricted common shares for every one
preferred share at a conversion rate of .10 per common share for a period of ten years
from June 12, 1997. At December 31, 1999 the Company was offering to buy back the
preferred shares from the shareholders.

Redeemable Common Stock Warrants

Warrants for the purchase of common shares that were issued and
outstanding as of December 31, 1999 are summarized below:

Number of
    Exercise
    Year ofWarrants
    Price
    Expiration2,150,000
    $ 0.10
    2002




NOTE 15 - RELATED PARTY TRANSACTIONS

During 1998, various employees and shareholders exercised 1,095,642 of
options for $118,405. Notes payable to stockholders at December 31, 1999 and 1998,
consisted of unsecured short-term notes at 8% interest in the amount of $422,100.

The Company sub-leases part of its office space to Whitney &
Whitney, Inc. with whom they have a consulting agreement. The consulting agreement has a
term of three years beginning March 1, 1999 and may be extended for an additional three
years. The agreement calls for payments by Golden Phoenix Minerals, Inc. of a minimum of
$2,500 per month in restricted Golden Phoenix common shares. The agreement may be
terminated by either party upon 90 days written notice. Total services from Whitney &
Whitney were $95,546 for 1999.

The President of Whitney & Whitney, Inc., Dr. Whitney, is a
shareholder of Golden Phoenix Minerals, Inc. At December 31, 1999, he owned approximately
12% of outstanding stock. Dr. Whitney has an agreement to acquire up to 10,000,000 common
shares of the Company. He has agreed to purchase up to 5,000,000 restricted common shares
at $0.10, each share accompanied by a 3 year warrant to purchase one additional share at
$0.10. Dr. Whitney has the right to transfer these options to others.



GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998





NOTE 16 - INCOME TAXES

The income tax provision consists of the following at December 31:

1999
    1998Current Federal Tax Expense
    $ -
    $ -Deferred Federal Tax Benefit (Expense)
    3,003
    (2,223)Total Provision for Income Taxes
    $ 3,003
    $ (2,223)


Deferred income taxes are provided for the temporary differences
between the financial reporting basis and the tax basis of the Company's assets and
liabilities. The major temporary differences that give rise to the deferred tax
liabilities and assets are depreciation, net operating loss carryforwards and accrued
salaries.

The total deferred tax liabilities and assets are as follows:



1999
    1998Deferred tax liabilities
    $ (1,959)
    $ (3,003)Deferred tax assets
    563,895
    465,600Total valuation allowance recognized for
    deferred tax assetsand liabilities
    (561,963)
    (465,600)Net Deferred Tax (Liability) Asset
    $ -
    $ (3,003)


Deferred income taxes arise from timing differences resulting from
income and expense items reported for financial accounting and tax purposes in different
periods. Deferred taxes are classified as current or noncurrent, depending on the
classification of the assets and liabilities to which they relate. Deferred taxes arising
from timing differences that are not related to an asset or liability are classified as
current or noncurrent depending on the periods in which the timing differences are
expected to reverse.

The Company has available at December 31, 1999, unused operating loss
carryforwards, which may be applied against future taxable income, that expire as follows:

Expiration DuringAmount of Unused Operating
    Year EndedLoss Carryforwards
    December 31$ 658,624
    20141,648,493
    20131,452,185
    2012$3,759,302


GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 16 - INCOME TAXES - Continued

The principal reasons for the difference between the effective income
tax rate and the federal statutory rate are as follows:

1999
    1998Federal benefit expected at statutory rate
    $ (106,927)
    $ (262,635)Operating losses with no current benefit
    98,794
    247,274Accrued salaries
    6,108
    11,695Depreciation
    (290)
    (1,215)Non-deductible expenses
    2,315
    4,881$ -
    $ -


NOTE 17 - FAIR VALUE OF FINANCIAL INSTRUMENTS

Statement of Financial Accounting Standards No. 107, "Disclosures
About Fair Value of Financial Instruments" (SFAS No. 107), requires disclosure of the
fair value of financial instruments. The estimated fair value amounts have been determined
by the Company using available market value information and appropriate methodologies.
However, considerable judgement is required to interpret market data to develop the
estimates of fair value. Accordingly, the estimates may not be indicative of the amount
the Company could realize in a current market exchange. Estimated fair values of the
Company's financial instruments as of December 31, 1999 and December 31, 1998 are the same
as their carrying amount.

The following methods and assumptions were used to estimate the fair
value of each class of financial instruments for which it is practicable to estimate such
values:

For cash and cash equivalents, accounts receivable, notes payable and
capital leases, the carrying amount reported in the consolidated balance sheets is
considered to be a reasonable estimate of fair value based on interest rates of similar
financial instruments in the marketplace.

NOTE 18 - STOCK OPTIONS

The Company applies APB Opinion 25 in accounting for its stock options.
Compensation cost charged to operations was $0 in 1999 and 1998. Had compensation cost
been determined on the basis of fair value pursuant to FASB Statement No. 123, net income
(loss) and earnings per share would have been impacted as follows:

1999
    1998Net Income (Loss)As reported
    $(712,847)
    $(1,750,898)Pro forma
    $(712,847)
    $(3,019,176)






GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 18 - STOCK OPTIONS - Continued

Basic and Diluted Earnings Per ShareAs reported
    $ (.03)
    $ (.12)Pro forma
    $ (.03)
    $ (.20)


The pro forma amounts were estimated using the Black-Scholes option
pricing model with the following assumptions for 1998:

Dividend Yield
    0%Risk-Free Interest Rate
    5.50%Expected Life
    2-3 yearsExpected Volatility
    131.31%


Expected lives are equal to the remaining option terms for both years,
dividend yields are 0% since the Company does not intend to pay dividends on its common
stock in the near term.

Compensation expense that would have been charged to operations had the
provisions of FASB 123 been applied were $0 in 1999 and $1,268,278 in 1998.

Following is a summary of the status of options outstanding during the
years ended December 31, 1999 and 1998:

Year Ended December 31, 1999
    Year Ended December 31, 1998Weighted
    
    WeightedAverage
    
    AverageExercise
    
    Exercise# of Shares
    Price
    # of Shares
    PriceOutstanding atJanuary 1
    4,096,066
    
    3,835,000
    $ 1.44Granted
    -
    
    2,775,964
    0.64Canceled
    -
    
    (2,004,898)
    0.53Exercised
    -
    
    (510,000)
    0.20Outstanding atDecember 31
    4,096,066
    
    4096,066
    1.49Options exercisable atDecember 31
    4,096,066
    
    4,096,066
    1.49Weighted average fair valueof options granted during1999 and 1998
    -
    
    
    0.49






GOLDEN PHOENIX MINERLAS, INC.

(A Development Stage Company)

NOTES TO FINACIAL STATEMENTS

DECEMBER 31, 1999 AND 1998



NOTE 18 - STOCK OPTIONS - Continued

The following table summarizes information regarding stock options
outstanding at December 31, 1999:

Outstanding Options
    Exercisable OptionsWeightedAverageRemaining
    Weighted
    
    WeightedExercise
    
    Contractual
    Average
    
    AveragePrice Range
    Number
    Life
    Exercise Price
    Number
    Exercise Price$ 0.10
    55,000
    .50 years
    $ 0.10
    55,000
    $ 0.100.20
    539,000
    2.00 years
    0.20
    539,000
    0.200.27
    203,907
    2.00 years
    0.27
    203,907
    0.270.50
    85,049
    .50 years
    0.50
    85,049
    0.500.69
    702,000
    2.00 years
    0.69
    702,000
    0.691.05
    1,000,000
    .50 years
    1.05
    1,000,000
    1.052.00
    426,110
    .50 years
    2.00
    426,110
    2.003.00
    835,000
    .50 years
    3.00
    835,000
    3.004.00
    250,000
    .50 years
    4.00
    250,000
    4.004,096,066
    
    
    4,096,066




NOTE 19 - SUBSEQUENT EVENTS

During 2000, the Company offered for sale $1,000,000 in 12% convertible
promissory notes with accrued interest and principal due five years from the date of
issue. The notes are convertible into restricted common shares of Golden Phoenix Minerals,
Inc. at a price of $0.20 per share. The Company sold $405,000 of these notes in January,
2000.

Equity Transactions

During 2000, the Company issued 550,000 shares of common stock for
$55,000.

Stock Options

During 2000, the Company granted warrants to purchase 550,000 shares of
common stock at $0.10 per share.



GOLDEN PHOENIX MINERALS, INC. AND SUBSIDIARIES

SIGNIFICANT SUBSIDIARIES

EXHIBIT 21



NAMES UNDER

STATE OF WHICH

NAME INCORPORATION THEY DO BUSINESS

Golden Phoenix Alaska Inc. Nevada Same

In October 1999 the Company exchanged its 72% interest in Golden Phoenix Alaska, Inc.
for certain interests in mining properties and production royalties.







SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.





GOLDEN PHOENIX MINERALS, INC.

Date: March 29, 2000
                                          
               By:
/s/ Michael R. Fitzsimonds

Michael
R. Fitzsimonds

President
and Director

(Principal
Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the Company and in
the capacities and on the dates indicated.

Date: March 29, 2000
                                          
            By:
/s/ Michael R. Fitzsimonds

Michael
R. Fitzsimonds

President
and Director

(Principal
Executive, Financial and

Accounting
Officer)

Date: March 29, 2000
                                          
                           By:
/s/ Steven D. Craig

Steven
D. Craig

Vice
President, Secretary, and

Director

Date: March 29, 2000
                                          
                               By:
/s/ Allen J. Marter

Allen
J. Marter

Director

Date: March 29, 2000
                                          
                         By:
/s/ David A. Caldwell

David
A. Caldwell

Director