---

UNITED STATESSECURITIES
AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2010

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

For the transition period from _________to _________

0-21777(Commission File Number)

GOLDEN QUEEN MINING CO. LTD.
  (Exact name of registrant as specified in
its charter)

|Province of British Columbia                  | Not Applicable               
|--------------------------------------------- | -----------------------------
|(State or other jurisdiction of incorporation | (IRS Employer Identification)
|No.)                                          |                              

6411 Imperial AvenueWest Vancouver,
British ColumbiaV7W 2J5 Canada
  (Address of principal executive offices)

Issuers telephone number, including area code: (604)
921-7570

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

Check whether the registrant (1) filed all reports required to
be filed by sections 13 or 15(d) of the Securities and Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X]     No
[   ]

Check whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). Yes
[X]     No [   ]

Check whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer [   ]     Accelerated
filer [   ]     Non-accelerated filed [ 
 ]     Smaller reporting company [X]

Check whether the registrant is a shell company, as defined in
Rule 12b-2 of the Exchange Act.Yes [   ]    
No [X]

State the number of shares outstanding of each of the issuers
  classes of common equity, as of the latest practicable date: As of September
  30, 2010 the registrants outstanding common stock consisted of94,128,383 shares.

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EXPLANATORY NOTE

This quarterly report on Form 10-Q for the period ended
September 30, 2010 discloses and discusses the impact and effect of restatements
of our financial statements that were previously filed with Canadian securities
regulators as at September 30, 2010 and the related interim consolidated balance
sheets as at September 30, 2010 and the unaudited interim consolidated
statements of loss and, stockholders equity and cash flows for the quarters
ended September 30, 2010 and 2009 for the effects of the adoption of accounting
pronouncement and bookkeeping error.

On December 7, 2010, we filed a Form 8-K disclosing that we
would restate our historical financial statements as a result of an internal
review by our management, auditors and Audit Committee of our accounting for our
stock options and warrants. In addition, due to a bookkeeping error we also
identified errors in the general and administrative expenses and share capital
in our quarterly financial statements for the period ended September 30, 2010.
Accordingly, management concluded, and our audit committee agreed, that our
financial statements issued by us and filed with Canadian securities regulators
relating to quarters ended September 30, 2010 and September 30, 2009 should no
longer be relied upon.

As a result of the review, our Company also concluded that the
new accounting pronouncement of ASC 815-40-15 was not properly adopted on
January 1, 2009, and that certain expenses were not properly accounted for when
the goods or services were received. Consequently the errors have affected the
general and administrative expenses for the three-months ended September 30,
2010.

We are therefore including in this Form 10-Q restated financial
statements that replace the previously issued financial statements that were
filed with Canadian securities regulators, in order to properly record the
period end amounts of general and administrative expenses, change in fair value
in derivative liability, the amounts of net loss for the period and loss per
share and the ending deficit for the period ended September 30, 2010 on the
unaudited interim consolidated statement of loss, derivative liability on the
unaudited interim consolidated balance sheet, the amounts of common shares and
additional paid-in capital on the unaudited interim consolidated statement of
shareholders equity. These adjustments result in an increase in net loss and
comprehensive loss by $2,186,607 (2009 - $629,533) and $2,987,189 (2009 -
$1,653,275) for the three and nine months period ended September 30, 2010, an
increase in the ending deficit by $4,618,234, a decrease in share capital by
$21,715 and a decrease in additional paid in capital by $2,398,528, and increase
in total liabilities by $7,038,477. The restatement also affected our statements
of cash flows; the cash flows used in operating activities were overstated by
$21,715 and the cash flows provided by financing activities were overstated by
$21,715.

As a result of the restatement noted above, we have also
amended our disclosures previously filed with Canadian securities regulators
regarding the controls and procedures, which are disclosed in Item 4of
this Form 10-Q.

This quarterly report on Form 10-Q for the quarter ended
September 30, 2010 includes only restatements of the above disclosures for the
quarter ended September 30, 2010 that were previously issued by the Company and
filed with Canadian securities regulators. The restatements do not (i) modify or
update disclosures in such prior filings except as required to reflect the
effects of the restatement or (ii) make revisions to the Notes to the
Consolidated Financial Statements except for those which are required by or
result from the effects of the restatement. For additional information regarding
the restatement, see Note 7 to our Interim Unaudited Consolidated Financial
Statements included in Part I - Item 1.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

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GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Interim Consolidated Financial StatementsSeptember 30, 2010(Unaudited -Restated)

(US dollars)

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GOLDEN QUEEN MINING CO. LTD. (an exploration stage
      company)Interim Consolidated Balance Sheets(Unaudited)

|                                                                                                                                                                                                                                   |   | September 30, 2010  |   |   | December 31, 2009   |  
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------------- | - | - | ------------------- | -
|                                                                                                                                                                                                                                   |   | (Restated  Note 7) |   |   | (Restated  Note 7) |  
|Assets                                                                                                                                                                                                                             |   |                     |   |   |                     |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Current
      assets:                                                                                                                                                                                                              |   |                     |   |   |                     |  
|Cash and
      cash equivalents                                                                                                                                                                                                    | $ | 7,808,244           |   | $ | 2,433,202           |  
|Receivables                                                                                                                                                                                                                        |   | 31,754              |   |   | 24,604              |  
|Prepaid
      expenses and other current assets                                                                                                                                                                                    |   | 27,031              |   |   | 19,490              |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Total current assets                                                                                                                                                                                                               |   | 7,867,029           |   |   | 2,477,296           |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Property and equipment,
      net                                                                                                                                                                                                  |   | 201,461             |   |   | 205,916             |  
|Reclamation financial assurance                                                                                                                                                                                                    |   | 286,653             |   |   | 286,653             |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Total Assets                                                                                                                                                                                                                       | $ | 8,355,143           |   | $ | 2,969,865           |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Liabilities and Shareholders
      Equity (Capital Deficit)                                                                                                                                                                       |   |                     |   |   |                     |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Current
      liabilities:                                                                                                                                                                                                         |   |                     |   |   |                     |  
|Accounts
      payable                                                                                                                                                                                                             | $ | 364,453             |   | $ | 150,766             |  
|Accrued liabilities                                                                                                                                                                                                                |   | -                   |   |   | 77,821              |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Total
      current liabilities                                                                                                                                                                                                    |   | 364,453             |   |   | 228,587             |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Asset
      retirement obligations                                                                                                                                                                                                 |   | 189,550             |   |   | 177,564             |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Derivative liability (Note 7)                                                                                                                                                                                                      |   | 7,038,477           |   |   | 2,695,602           |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Total Liabilities                                                                                                                                                                                                                  |   | 7,592,480           |   |   | 3,101,753           |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Shareholders Equity (Capital Deficit):                                                                                                                                                                                            |   |                     |   |   |                     |  
|Preferred
      shares, no par value, 3,000,000 shares
      authorized; 
               no
      shares outstanding                                                                                                               |   |                     |   |   |                     |  
|Common
      shares, no par value, 150,000,000 shares
      authorized; 
               (September
      30, 2010  94,128,383; December 31, 2009
       
               88,378,383)
      shares issued and outstanding (Note 3) |   | 56,314,267          |   |   | 50,205,634          |  
|Additional paid-in
      capital                                                                                                                                                                                                   |   | 3,569,371           |   |   | 3,130,549           |  
|Deficit
      accumulated during the exploration stage                                                                                                                                                                             |   | (59,120,975         | ) |   | (53,468,071         | )
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Total shareholders equity
      (capital deficit)                                                                                                                                                                                 |   | 762,663             |   |   | (131,888            | )
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Total Liabilities and
      Shareholders Equity (Capital Deficit)                                                                                                                                                                 | $ | 8,355,143           |   | $ | 2,969,865           |  
|                                                                                                                                                                                                                                   |   |                     |   |   |                     |  
|Basis of presentation
      and ability to continue as a going concern (Note 1)                                                                                                                                                    |   |                     |   |   |                     |  
|Commitments and contingencies (Note 4)                                                                                                                                                                                             |   |                     |   |   |                     |  

Approved by the Directors:

|H. L. Klingmann           |  | C.
      Shynkaryk       
|--------------------------- |  | ---------------------------
|H. Lutz Klingmann, Director |  | Chester Shynkaryk, Director

See Notes to Unaudited Interim Consolidated Financial Statements

2

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GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Interim Consolidated Statements of Loss(Unaudited)

|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   | Cumulative        |  
|----------------------------------------------------------------------------------------------------------- | - | --------------- | - | - | --------------- | - | - | --------------- | - | - | --------------- | - | - | ----------------- | -
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   | Amounts From      |  
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   | Date of Inception |  
|                                                                                                            |   | Three Months    |   |   | Three Months    |   |   | Nine Months     |   |   | Nine Months     |   |   | (November 21,     |  
|                                                                                                            |   | Ended           |   |   | Ended           |   |   | Ended           |   |   | Ended           |   |   | 1985) Through     |  
|                                                                                                            |   | September 30,   |   |   | September 30,   |   |   | September 30,   |   |   | September 30,   |   |   | September 30,     |  
|                                                                                                            |   | 2010(restated   |   |   | 2009(restated   |   |   | 2010(restated   |   |   | 2009(restated   |   |   | 2010(restated     |  
|                                                                                                            |   | 
      Note 7) |   |   | 
      Note 7) |   |   | 
      Note 7) |   |   | 
      Note 7) |   |   | 
      Note 7)   |  
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                   |  
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                   |  
|General and administrative
      expenses                                                                   | $ | (706,455        | ) | $ | (431,324        | ) | $ | (2,647,764      | ) | $ | (1,622,016      | ) | $ | (22,375,564       | )
|Asset impairment loss                                                                                       |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | (32,135,592       | )
|Adjustment to asset
      retirement 
         obligation on changes in cash 
        
      flow estimates |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | 223,583           |  
|Accretion expense                                                                                           |   | (3,996          | ) |   | (3,353          | ) |   | (11,986         | ) |   | (10,059         | ) |   | (67,367           | )
|Increase in fair value of
      derivative 
         liability (Note 7)                                     |   | (2,429,443      | ) |   | (629,533        | ) |   | (3,008,904      | ) |   | (1,653,275      | ) |   | (5,104,205        | )
|Gain on settlement of debt                                                                                  |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | 136,627           |  
|Abandoned mineral property
      interests                                                                  |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | (277,251          | )
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                   |  
|                                                                                                            |   | (3,139,894      | ) |   | (1,064,210      | ) |   | (5,668,654      | ) |   | (3,285,350      | ) |   | (59,599,769       | )
|Interest expense                                                                                            |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | (913,098          | )
|Interest income                                                                                             |   | 14,767          |   |   | 7,061           |   |   | 15,750          |   |   | 9,968           |   |   | 1,615,736         |  
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                   |  
|Net loss and comprehensive
      loss 
         for the period                                              | $ | (3,125,127      | ) | $ | (1,057,149      | ) | $ | (5,652,904      | ) | $ | (3,275,382      | ) | $ | (58,897,131       | )
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                   |  
|Loss per share, basic and
      diluted                                                                     | $ | (0.03           | ) | $ | (0.01           | ) | $ | (0.06           | ) | $ | (0.04           | ) |   |                   |  
|                                                                                                            |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                   |  
|Weighted average number of
      common 
         shares outstanding                                        |   | 94,093,057      |   |   | 87,273,763      |   |   | 91,244,500      |   |   | 86,191,158      |   |   |                   |  

See Notes to Unaudited Interim Consolidated Financial
  Statements

3

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GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Interim Consolidated Statement of Changes in Shareholders
    Equity(Unaudited)

|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   | Deficit     |   |   | Total         |  
|-------------------------------------------------------------- |  | ---------- |  | - | ---------- |  | - | ------------ |  | - | ---------- |  | - | ----------- | - | - | ------------- | -
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   | Accumulated |   |   | Shareholders |  
|                                                               |  |            |  |   |            |  |   |              |  |   | Additional |  |   | During the  |   |   | Equity        |  
|From the Date of Inception (November 21,                       |  | Common     |  |   |            |  |   | Stock        |  |   | Paid-in    |  |   | Exploration |   |   | (Capital      |  
|1985) Through September 30, 2010                               |  | Shares     |  |   | Amount     |  |   | Subscription |  |   | Capital    |  |   | Stage       |   |   | Deficit)      |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|November 21, 1985                                              |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for
      cash                       |  | 1,425,001  |  | $ | 141,313    |  | $ | -            |  | $ | -          |  | $ | -           |   | $ | 141,313       |  
|Net loss for the period                                        |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (15,032     | ) |   | (15,032       | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1986                                          |  | 1,425,001  |  |   | 141,313    |  |   | -            |  |   | -          |  |   | (15,032     | ) |   | 126,281       |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for cash                             |  | 550,000    |  |   | 256,971    |  |   | -            |  |   | -          |  |   | -           |   |   | 256,971       |  
|Issuance of common shares for
      mineral 
         property |  | 25,000     |  |   | 13,742     |  |   | -            |  |   | -          |  |   | -           |   |   | 13,742        |  
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (58,907     | ) |   | (58,907       | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1987                                          |  | 2,000,001  |  |   | 412,026    |  |   | -            |  |   | -          |  |   | (73,939     | ) |   | 338,087       |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for cash                             |  | 1,858,748  |  |   | 1,753,413  |  |   | -            |  |   | -          |  |   | -           |   |   | 1,753,413     |  
|Net income for the year                                        |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | 38,739      |   |   | 38,739        |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1988                                          |  | 3,858,749  |  |   | 2,165,439  |  |   | -            |  |   |            |  |   | (35,200     | ) |   | 2,130,239     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for
      cash                       |  | 1,328,750  |  |   | 1,814,133  |  |   | -            |  |   | -          |  |   | -           |   |   | 1,814,133     |  
|Issuance of common shares for
      mineral 
         property |  | 100,000    |  |   | 227,819    |  |   | -            |  |   | -          |  |   | -           |   |   | 227,819       |  
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (202,160    | ) |   | (202,160      | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1989                                          |  | 5,287,499  |  |   | 4,207,391  |  |   | -            |  |   | -          |  |   | (237,360    | ) |   | 3,970,031     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for
      cash                       |  | 1,769,767  |  |   | 2,771,815  |  |   | -            |  |   | -          |  |   | -           |   |   | 2,771,815     |  
|Issuance of common shares for
      mineral 
         property |  | 8,875      |  |   | 14,855     |  |   | -            |  |   | -          |  |   | -           |   |   | 14,855        |  
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (115,966    | ) |   | (115,966      | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1990                                          |  | 7,066,141  |  |   | 6,994,061  |  |   | -            |  |   | -          |  |   | (353,326    | ) |   | 6,640,735     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Net income for the year                                        |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | 28,706      |   |   | 28,706        |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1991                                          |  | 7,066,141  |  |   | 6,994,061  |  |   | -            |  |   | -          |  |   | (324,620    | ) |   | 6,669,441     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (157,931    | ) |   | (157,931      | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1992                                          |  | 7,066,141  |  |   | 6,994,061  |  |   | -            |  |   | -          |  |   | (482,551    | ) |   | 6,511,510     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (285,391    | ) |   | (285,391      | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1993                                          |  | 7,066,141  |  |   | 6,994,061  |  |   | -            |  |   | -          |  |   | (767,942    | ) |   | 6,226,119     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for
      cash                       |  | 5,834,491  |  |   | 1,536,260  |  |   | -            |  |   | -          |  |   | -           |   |   | 1,536,260     |  
|Share issuance costs                                           |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (18,160     | ) |   | (18,160       | )
|Issuance of common shares for
      mineral 
         property |  | 128,493    |  |   | 23,795     |  |   | -            |  |   | -          |  |   | -           |   |   | 23,795        |  
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (158,193    | ) |   | (158,193      | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1994                                          |  | 13,029,125 |  |   | 8,554,116  |  |   | -            |  |   | -          |  |   | (944,295    | ) |   | 7,609,821     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for cash                             |  | 648,900    |  |   | 182,866    |  |   | -            |  |   | -          |  |   | -           |   |   | 182,866       |  
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (219,576    | ) |   | (219,576      | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1995                                          |  | 13,678,025 |  |   | 8,736,982  |  |   | -            |  |   | -          |  |   | (1,163,871  | ) |   | 7,573,111     |  
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for
      cash                       |  | 2,349,160  |  |   | 2,023,268  |  |   | -            |  |   | -          |  |   | -           |   |   | 2,023,268     |  
|Issuance of common shares for debt                             |  | 506,215    |  |   | 662,282    |  |   | -            |  |   | -          |  |   | -           |   |   | 662,282       |  
|Issuance of 5,500,000 special
      warrants                   |  | -          |  |   | 9,453,437  |  |   | -            |  |   | -          |  |   | -           |   |   | 9,453,437     |  
|Special warrants issuance costs                                |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (100,726    | ) |   | (100,726      | )
|Net loss for the year                                          |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (426,380    | ) |   | (426,380      | )
|                                                               |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, May 31, 1996                                          |  | 16,533,400 |  | $ | 20,875,969 |  | $ | -            |  | $ | -          |  | $ | (1,690,977  | ) | $ | 19,184,992    |  

See Notes to Unaudited Interim Consolidated Financial Statements

4

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Interim Consolidated Statement of Changes in Shareholders
    Equity(Unaudited)

|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   | Deficit     |   |   | Total         |  
|------------------------------------------------------------------------------ |  | ---------- |  | - | ---------- |  | - | ------------ | - | - | ---------- | - | - | ----------- | - | - | ------------- | -
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   | Accumulated |   |   | Shareholders |  
|                                                                               |  |            |  |   |            |  |   |              |   |   | Additional |   |   | During the  |   |   | Equity        |  
|From the Date of Inception (November 21,                                       |  | Common     |  |   |            |  |   | Stock        |   |   | Paid-in    |   |   | Exploration |   |   | (Capital      |  
|1985) Through September 30, 2010                                               |  | Shares     |  |   | Amount     |  |   | Subscription |   |   | Capital    |   |   | Stage       |   |   | Deficit)      |  
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Balance carried forward from
      previous page                               |  | 16,533,400 |  | $ | 20,875,969 |  | $ | -            |   | $ | -          |   | $ | (1,690,977  | ) | $ | 19,184,992    |  
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Issuance of common shares for
      cash                                       |  | 18,000     |  |   | 10,060     |  |   | -            |   |   | -          |   |   | -           |   |   | 10,060        |  
|Issuance of common shares for
      special 
         warrants                 |  | 5,500,000  |  |   | -          |  |   | -            |   |   | -          |   |   | -           |   |   | -             |  
|Special warrants issuance
      costs                                          |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (123,806    | ) |   | (123,806      | )
|Net loss for the period                                                        |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (348,948    | ) |   | (348,948      | )
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Balance, December 31, 1996                                                     |  | 22,051,400 |  |   | 20,886,029 |  |   | -            |   |   | -          |   |   | (2,163,731  | ) |   | 18,722,298    |  
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Issuance of common shares for cash                                             |  | 157,000    |  |   | 157,050    |  |   | -            |   |   | -          |   |   | -           |   |   | 157,050       |  
|Issuance of 3,500,000 special
      warrants                                   |  | -          |  |   | 5,287,315  |  |   | -            |   |   | -          |   |   | -           |   |   | 5,287,315     |  
|Issuance of common shares for
      special 
         warrants                 |  | 3,500,000  |  |   | -          |  |   | -            |   |   | -          |   |   | -           |   |   | -             |  
|Options to non-employee
      directors                                        |  | -          |  |   | -          |  |   | -            |   |   | 70,200     |   |   | -           |   |   | 70,200        |  
|Special warrants issuance costs                                                |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (163,313    | ) |   | (163,313      | )
|Net loss for the year                                                          |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (1,047,869  | ) |   | (1,047,869    | )
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Balance, December 31, 1997                                                     |  | 25,708,400 |  |   | 26,330,394 |  |   | -            |   |   | 70,200     |   |   | (3,374,913  | ) |   | 23,025,681    |  
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Issuance of common shares
      upon 
         exercise of warrants            |  | 1,834,300  |  |   | 857,283    |  |   | -            |   |   | -          |   |   | -           |   |   | 857,283       |  
|Issuance of common shares
      through 
         conversion of debt           |  | 2,017,941  |  |   | 1,000,000  |  |   | -            |   |   | -          |   |   | -           |   |   | 1,000,000     |  
|Share issuance costs                                                           |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (6,060      | ) |   | (6,060        | )
|Issuance of common shares for cash                                             |  | 5,236,000  |  |   | 2,439,753  |  |   | -            |   |   | -          |   |   | -           |   |   | 2,439,753     |  
|Options and re-priced options
      to non- 
         employee directors       |  | -          |  |   | -          |  |   | -            |   |   | 107,444    |   |   | -           |   |   | 107,444       |  
|Net loss for the year                                                          |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (971,595    | ) |   | (971,595      | )
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Balance, December 31, 1998                                                     |  | 34,796,641 |  |   | 30,627,430 |  |   | -            |   |   | 177,644    |   |   | (4,352,568  | ) |   | 26,452,506    |  
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Issuance of 13,250,000 special warrants                                        |  | -          |  |   | 3,350,915  |  |   | -            |   |   | -          |   |   | -           |   |   | 3,350,915     |  
|Special warrants issuance
      costs                                          |  | -          |  |   |            |  |   | -            |   |   | -          |   |   | (166,620    | ) |   | (166,620      | )
|Issuance of common shares
      for 
         special warrants                 |  | 13,250,000 |  |   | -          |  |   | -            |   |   | -          |   |   | -           |   |   | -             |  
|Net loss for the year                                                          |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (564,657    | ) |   | (564,657      | )
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Balance, December 31, 1999                                                     |  | 48,046,641 |  |   | 33,978,345 |  |   | -            |   |   | 177,644    |   |   | (5,083,845  | ) |   | 29,072,144    |  
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Cumulative effect of change
      in 
         accounting for stock options    |  | -          |  |   | -          |  |   | -            |   |   | (177,644   | ) |   | -           |   |   | (177,644      | )
|Stock subscription                                                             |  | -          |  |   | -          |  |   | 200,000      |   |   | -          |   |   | -           |   |   | 200,000       |  
|Net loss for the year                                                          |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (28,708,276 | ) |   | (28,708,276   | )
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Balance, December 31, 2000                                                     |  | 48,046,641 |  |   | 33,978,345 |  |   | 200,000      |   |   | -          |   |   | (33,792,121 | ) |   | 386,224       |  
|Issuance of common shares
      through 
         conversion of debt           |  | 406,250    |  |   | 65,000     |  |   | -            |   |   | -          |   |   | -           |   |   | 65,000        |  
|Issuance of common shares
      for 
         conversion of stock subscription |  | 1,538,462  |  |   | 200,000    |  |   | (200,000     | ) |   | -          |   |   | -           |   |   | -             |  
|Share issuance costs                                                           |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (3,337      | ) |   | (3,337        | )
|Net loss for the year                                                          |  | -          |  |   | -          |  |   | -            |   |   | -          |   |   | (262,059    | ) |   | (262,059      | )
|                                                                               |  |            |  |   |            |  |   |              |   |   |            |   |   |             |   |   |               |  
|Balance, December 31, 2001                                                     |  | 49,991,353 |  | $ | 34,243,345 |  | $ | -            |   | $ | -          |   | $ | (34,057,517 | ) | $ | 185,828       |  

See Notes to Unaudited Interim Consolidated Financial Statements

5

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Interim Consolidated Statement of Changes in Shareholders
    Equity(Unaudited)

|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   | Deficit     |   |   | Total         |  
|---------------------------------------------------------------------- |  | ---------- |  | - | ---------- |  | - | ------------ |  | - | ---------- |  | - | ----------- | - | - | ------------- | -
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   | Accumulated |   |   | Shareholders |  
|                                                                       |  |            |  |   |            |  |   |              |  |   | Additional |  |   | During the  |   |   | Equity        |  
|From the Date of Inception (November 21,                               |  | Common     |  |   |            |  |   | Stock        |  |   | Paid-in    |  |   | Exploration |   |   | (Capital      |  
|1985) Through September 30, 2010                                       |  | Shares     |  |   | Amount     |  |   | Subscription |  |   | Capital    |  |   | Stage       |   |   | Deficit)      |  
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance carried forward from previous page                             |  | 49,991,353 |  | $ | 34,243,345 |  | $ | -            |  | $ | -          |  | $ | (34,057,517 | ) | $ | 185,828       |  
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares
      through 
         exercise of options  |  | 290,000    |  |   | 37,234     |  |   | -            |  |   | -          |  |   | -           |   |   | 37,234        |  
|Issuance of common shares through 
        
      exercise of warrants |  | 1,520,836  |  |   | 243,334    |  |   | -            |  |   | -          |  |   | -           |   |   | 243,334       |  
|Stock option compensation                                              |  | -          |  |   | -          |  |   | -            |  |   | 21,456     |  |   | -           |   |   | 21,456        |  
|Share issuance costs                                                   |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (4,216      | ) |   | (4,216        | )
|Net loss for the year                                                  |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (347,603    | ) |   | (347,603      | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, December 31, 2002                                             |  | 51,802,189 |  |   | 34,523,913 |  |   | -            |  |   | 21,456     |  |   | (34,409,336 | ) |   | 136,033       |  
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares
      through 
         exercise of options  |  | 100,000    |  |   | 24,379     |  |   | -            |  |   | -          |  |   | -           |   |   | 24,379        |  
|Equity component of convertible notes                                  |  | -          |  |   | -          |  |   | -            |  |   | 375,000    |  |   | -           |   |   | 375,000       |  
|Stock option compensation                                              |  | -          |  |   | -          |  |   | -            |  |   | 127,326    |  |   | -           |   |   | 127,326       |  
|Net loss for the year                                                  |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (744,516    | ) |   | (744,516      | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, December 31, 2003                                             |  | 51,902,189 |  |   | 34,548,292 |  |   | -            |  |   | 523,782    |  |   | (35,153,852 | ) |   | (81,778       | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for cash                                     |  | 8,000,000  |  |   | 3,036,282  |  |   | -            |  |   | -          |  |   | -           |   |   | 3,036,282     |  
|Issuance of common shares
      for 
         convertible notes        |  | 978,260    |  |   | 225,000    |  |   | -            |  |   | -          |  |   | -           |   |   | 225,000       |  
|Issuance of common shares through 
        
      exercise of options  |  | 200,000    |  |   | 55,861     |  |   | -            |  |   | -          |  |   | -           |   |   | 55,861        |  
|Share issuance costs                                                   |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (38,975     | ) |   | (38,975       | )
|Net loss for the year                                                  |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (1,772,250  | ) |   | (1,772,250    | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, December 31, 2004                                             |  | 61,080,449 |  |   | 37,865,435 |  |   | -            |  |   | 523,782    |  |   | (36,965,077 | ) |   | 1,424,140     |  
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares through 
        
      exercise of options  |  | 110,000    |  |   | 21,049     |  |   | -            |  |   | -          |  |   | -           |   |   | 21,049        |  
|Stock option compensation                                              |  | -          |  |   | -          |  |   | -            |  |   | 48,592     |  |   | -           |   |   | 48,592        |  
|Net loss for the year                                                  |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (1,476,324  | ) |   | (1,476,324    | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, December 31, 2005                                             |  | 61,190,449 |  |   | 37,886,484 |  |   | -            |  |   | 572,374    |  |   | (38,441,401 | ) |   | 17,457        |  
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares through 
        
      private placement    |  | 7,200,000  |  |   | 1,614,716  |  |   | -            |  |   | 1,520,899  |  |   | -           |   |   | 3,135,615     |  
|Issuance of common shares
      through 
         exercise of options  |  | 100,000    |  |   | 30,853     |  |   | -            |  |   | -          |  |   | -           |   |   | 30,853        |  
|Issuance of common shares through 
        
      exercise of warrants |  | 8,978,260  |  |   | 4,659,173  |  |   | -            |  |   | -          |  |   | -           |   |   | 4,659,173     |  
|Issuance of common shares
      for 
         convertible notes        |  | 652,174    |  |   | 150,000    |  |   | -            |  |   | 39,917     |  |   | -           |   |   | 189,917       |  
|Stock option compensation                                              |  | -          |  |   | -          |  |   | -            |  |   | 814,810    |  |   | -           |   |   | 814,810       |  
|Modification of warrants                                               |  | -          |  |   | -          |  |   | -            |  |   | 889,117    |  |   | -           |   |   | 889,117       |  
|Share issuance costs                                                   |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (62,888     | ) |   | (62,888       | )
|Net loss for the year                                                  |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (4,910,036  | ) |   | (4,910,036    | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, December 31, 2006                                             |  | 78,120,883 |  |   | 44,341,226 |  |   | -            |  |   | 3,837,117  |  |   | (43,414,325 | ) |   | 4,764,018     |  
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares for
      exercise 
         of options      |  | 290,000    |  |   | 127,652    |  |   | -            |  |   | -          |  |   | -           |   |   | 127,652       |  
|Issuance of common shares for property                                 |  | 30,000     |  |   | 24,600     |  |   | -            |  |   | -          |  |   | -           |   |   | 24,600        |  
|Net loss for the year                                                  |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (2,006,482  | ) |   | (2,006,482    | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, December 31, 2007                                             |  | 78,440,883 |  |   | 44,493,478 |  |   | -            |  |   | 3,837,117  |  |   | (45,420,807 | ) |   | 2,909,788     |  
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Issuance of common shares through 
         exercise of warrants       |  | 7,200,000  |  |   | 4,184,425  |  |   | -            |  |   | -          |  |   | -           |   |   | 4,184,425     |  
|Net loss for the year                                                  |  | -          |  |   | -          |  |   | -            |  |   | -          |  |   | (3,996,777  | ) |   | (3,996,777    | )
|                                                                       |  |            |  |   |            |  |   |              |  |   |            |  |   |             |   |   |               |  
|Balance, December 31, 2008                                             |  | 85,640,883 |  | $ | 48,677,903 |  | $ | -            |  | $ | 3,837,117  |  | $ | (49,417,584 | ) | $ | 3,097,436     |  

See Notes to Unaudited Interim Consolidated Financial Statements

6

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Interim Consolidated Statement of Changes in Shareholders
    Equity(Unaudited)

|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   | Deficit     |   |   | Total         |  
|-------------------------------------------------------------------------------------------------------- |  | ---------- |  | - | ---------- | - | - | ------------ |  | - | ---------- | - | - | ----------- | - | - | ------------- | -
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   | Accumulated |   |   | Shareholders |  
|                                                                                                         |  |            |  |   |            |   |   |              |  |   | Additional |   |   | During the  |   |   | Equity        |  
|From the Date of Inception (November 21,                                                                 |  | Common     |  |   |            |   |   | Stock        |  |   | Paid-in    |   |   | Exploration |   |   | (Capital      |  
|1985) Through September 30, 2010                                                                         |  | Shares     |  |   | Amount     |   |   | Subscription |  |   | Capital    |   |   | Stage       |   |   | Deficit)      |  
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|Balance carried forward from previous page                                                               |  | 85,640,883 |  | $ | 48,677,903 |   | $ | -            |  | $ | 3,837,117  |   | $ | (49,417,584 | ) | $ | 3,097,436     |  
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|Cumulative effect of change
      in 
         accounting principle (Note 7)                             |  | -          |  |   | -          |   |   | -            |  |   | (863,402   | ) |   | 464,255     |   |   | (399,147      | )
|Issuance of common shares
      through 
         private placement                                      |  | 2,337,500  |  |   | 1,396,646  |   |   | -            |  |   | -          |   |   | -           |   |   | 1,396,646     |  
|Issuance of common shares
      through 
         exercise of options                                    |  | 400,000    |  |   | 131,085    |   |   | -            |  |   | -          |   |   | -           |   |   | 131,085       |  
|Reclassification of derivative
      liability 
         on the exercise of stock options
      (Note 7) |  | -          |  |   | -          |   |   | -            |  |   | 156,834    |   |   | -           |   |   | 156,834       |  
|Net loss for the year, restated                                                                          |  | -          |  |   | -          |   |   | -            |  |   | -          |   |   | (4,514,742  | ) |   | (4,514,742    | )
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|Balance, December 31, 2009 (restated)                                                                    |  | 88,378,383 |  |   | 50,205,634 |   |   | -            |  |   | 3,130,549  |   |   | (53,468,071 | ) |   | (131,888      | )
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|Issuance of common shares
      through 
         exercise of options                                    |  | 750,000    |  |   | 246,600    |   |   | -            |  |   | -          |   |   | -           |   |   | 246,600       |  
|Reclassification of derivative liability
      on 
         the exercise of stock options (Note 7)       |  | -          |  |   | -          |   |   | -            |  |   | 438,822    |   |   | -           |   |   | 438,822       |  
|Issuance of common shares
      through 
         private placement (Note 3)                             |  | 5,000,000  |  |   | 5,907,798  |   |   | -            |  |   | -          |   |   | -           |   |   | 5,907,798     |  
|Share issue costs                                                                                        |  | -          |  |   | (45,765    | ) |   | -            |  |   | -          |   |   | -           |   |   | (45,765       | )
|Net loss for the period (Note 7)                                                                         |  | -          |  |   | -          |   |   | -            |  |   | -          |   |   | (5,652,904  | ) |   | (5,652,904    | )
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|                                                                                                         |  |            |  |   |            |   |   |              |  |   |            |   |   |             |   |   |               |  
|Balance, September 30, 2010                                                                              |  | 94,128,383 |  | $ | 56,314,267 |   | $ | -            |  | $ | 3,569,371  |   | $ | (59,120,975 | ) | $ | 762,663       |  

See Notes to Unaudited Interim Consolidated Financial Statements

7

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Interim Consolidated Statement of Cash Flows(Unaudited)

|                                                                                                            |   |                 |   |   |                 |   |   | Cumulative Amounts   |  
|----------------------------------------------------------------------------------------------------------- | - | --------------- | - | - | --------------- | - | - | -------------------- | -
|                                                                                                            |   |                 |   |   |                 |   |   | From Date of         |  
|                                                                                                            |   |                 |   |   |                 |   |   | Inception            |  
|                                                                                                            |   | Nine Months     |   |   | Nine Months     |   |   | (November 21,        |  
|                                                                                                            |   | Ended           |   |   | Ended           |   |   | 1985) Through        |  
|                                                                                                            |   | September 30,   |   |   | September 30,   |   |   | September 30,        |  
|                                                                                                            |   | 2010(restated  |   |   | 2009(restated  |   |   | 2010(restated  Note |  
|                                                                                                            |   | Note
      7)   |   |   | Note
      7)   |   |   | 7)                   |  
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Operating activities:                                                                                       |   |                 |   |   |                 |   |   |                      |  
|Net loss for the period                                                                                     | $ | (5,652,904      | ) | $ | (3,275,382      | ) | $ | (58,897,131          | )
|Adjustments to reconcile net loss to cash
      used in 
        operating activities:                      |   |                 |   |   |                 |   |   |                      |  
|Asset impairment
      loss                                                                                 |   | -               |   |   | -               |   |   | 32,135,592           |  
|Abandoned mineral property
      interests                                                                  |   | -               |   |   | -               |   |   | 277,251              |  
|Amortization and
      depreciation                                                                         |   | 4,455           |   |   | 4,518           |   |   | 466,256              |  
|Amortization of debt discount                                                                               |   | -               |   |   | -               |   |   | 375,000              |  
|Adjustment to
      asset retirement obligation based 
            
      on changes in cash flow estimates |   | -               |   |   | -               |   |   | (223,583             | )
|Accretion expense                                                                                           |   | 11,986          |   |   | 10,059          |   |   | 67,367               |  
|Change in fair
      value of derivative liability                                                          |   | 3,008,904       |   |   | 1,653,275       |   |   | 5,104,205            |  
|Gain on disposition of property
      and equipment                                                         |   | -               |   |   | -               |   |   | (10,032              | )
|Stock option
      compensation                                                                             |   | 46,275          |   |   | 209,055         |   |   | 1,416,448            |  
|Financing charges related to
      modification of warrants                                                 |   | -               |   |   | -               |   |   | 889,117              |  
|Mineral property
      expenditures                                                                         |   | -               |   |   | -               |   |   | (22,395,449          | )
|Changes in assets and liabilities:                                                                          |   |                 |   |   |                 |   |   |                      |  
|Receivables                                                                                                 |   | (7,150          | ) |   | (8,897          | ) |   | (31,754              | )
|Prepaid expenses and other
      current assets                                                             |   | (7,541          | ) |   | (9,980          | ) |   | (113,940             | )
|Accounts payable
      and accrued liabilities                                                              |   | 135,866         |   |   | (172,912        | ) |   | 404,370              |  
|Royalty and mining rights
      payable                                                                     |   | -               |   |   | (48,034         | ) |   | -                    |  
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Cash used in operating activities                                                                           |   | (2,460,109      | ) |   | (1,638,298      | ) |   | (40,536,283          | )
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Investing activities:                                                                                       |   |                 |   |   |                 |   |   |                      |  
|Purchase of
      mineral properties                                                                        |   | -               |   |   | -               |   |   | (7,803,356           | )
|Deposits on mineral properties                                                                              |   | -               |   |   | -               |   |   | (1,017,551           | )
|Purchase of
      reclamation bonds                                                                         |   | -               |   |   | (14,845         | ) |   | (286,653             | )
|Purchase of property and
      equipment                                                                    |   | -               |   |   | -               |   |   | (1,313,838           | )
|Proceeds from
      sale of property and equipment                                                          |   | -               |   |   | -               |   |   | 47,153               |  
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Cash used in investing
      activities                                                                     |   | -               |   |   | (14,845         | ) |   | (10,374,245          | )
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Financing activities:                                                                                       |   |                 |   |   |                 |   |   |                      |  
|Borrowing under long-term debt                                                                              |   | -               |   |   | -               |   |   | 3,918,187            |  
|Payment of
      long-term debt                                                                             |   | -               |   |   | -               |   |   | (2,105,905           | )
|Proceeds from convertible debt                                                                              |   | -               |   |   | -               |   |   | 440,000              |  
|Issuance of
      common shares for cash                                                                    |   | 7,634,316       |   |   | 1,439,368       |   |   | 28,871,618           |  
|Share issuance costs                                                                                        |   | (45,765         | ) |   | -               |   |   | (733,866             | )
|Issuance of
      special warrants                                                                          |   | -               |   |   | -               |   |   | 18,091,667           |  
|Issuance of common shares upon
      exercise of stock options                                              |   | 246,600         |   |   | 65,009          |   |   | 536,190              |  
|Issuance of
      common shares upon exercise of warrants                                                   |   | -               |   |   | -               |   |   | 9,700,881            |  
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Cash provided by financing
      activities                                                                 |   | 7,835,151       |   |   | 1,504,377       |   |   | 58,718,772           |  
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Net change in cash and cash
      equivalents                                                               |   | 5,375,042       |   |   | (148,766        | ) |   | 7,808,244            |  
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Cash and cash equivalents,
      beginning balance                                                          |   | 2,433,202       |   |   | 3,033,771       |   |   | -                    |  
|                                                                                                            |   |                 |   |   |                 |   |   |                      |  
|Cash and cash equivalents,
      ending balance                                                             | $ | 7,808,244       |   | $ | 2,885,005       |   | $ | 7,808,244            |  

See Notes to Unaudited Interim Consolidated Financial
  Statements.

8

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|1. | Basis of Presentation and Ability to Continue as a
      Going Concern                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | These unaudited interim consolidated financial statements
      are presented in accordance with United States generally accepted
      accounting principles for interim financial statements, and are stated in
      US dollars. They do not include all the note disclosures required for
      annual financial statements. It is suggested that these unaudited interim
      consolidated financial statements be read in conjunction with the audited
      consolidated financial statements of the Company for the year ended
      December 31, 2009 and the notes thereto included in the Companys annual
      report for the year ended December 31, 2009. The Company follows the same
      accounting policies in the preparation of interim reports, except as
      disclosed under Note 2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The Company has had no revenues from operations since
      inception and as at September 30, 2010 has a deficit of $59,120,975
      accumulated during the exploration stage. Management plans to control
      current costs and does not anticipate requiring additional financing to
      fund Company activities over the next twelve months. In addition,
      management plans to secure equity and/or debt or joint venture financing
      to fund construction of the operating facility at the Soledad property
      (Soledad) once a feasibility study has been concluded and a production
      decision has been made. The ability of the Company to obtain financing for
      its ongoing activities and thus maintain solvency, or to fund construction
      of the operating facility at Soledad, is dependent on equity market
      conditions, the market for precious metals, the willingness of other
      parties to lend the Company money or the ability to find a joint venture
      partner. While the Company has been successful at certain of these efforts
      in the past, there can be no assurance that future efforts will be
      successful. This raises substantial doubt about the Companys ability to
      continue as a going concern.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | These unaudited interim consolidated financial statements
      reflect all adjustments, consisting of normal recurring adjustments,
      which, in the opinion of management, are necessary for the fair
      presentation of the information contained therein. The results for the
      three and nine months ended September 30, 2010 are not necessarily
      indicative of the results expected for any subsequent quarter or for the
      year ending December 31, 2010.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2. | Significant Accounting Policy                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Recent Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

9

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|2. | Significant Accounting Policy
      (continued)   
|-- | --------------------------------------------------
|   |                                                   
|   | Recent Accounting Pronouncements
      (continued)

| | (iii) | In April 2010, the FASB issued Accounting Standards
      Update 2010-13, Compensation  Stock Compensation (Topic 718). The
      objective of this update is to address the classification of an employee
      share-based payment award with an exercise price denominated in the
      currency of a market in which the underlying equity security trades. It
      provides guidance on the classification of a share-based payment award as
      either equity or a liability. A share-based payment award that contains a
      condition that is not a market, performance, or service condition is
      required to be classified as a liability. The amendments in this update
      are effective for fiscal years, and interim periods within those fiscal
      years, beginning on or after December 15, 2010. The amendments in this
      update should be applied by recording a cumulative-effect adjustment to
      the opening balance of retained earnings. The cumulative- effect
      adjustment should be calculated for all awards outstanding as of the
      beginning of the fiscal year in which the amendments are initially
      applied, as if the amendments had been applied consistently since the
      inception of the award. The cumulative-effect adjustment should be
      presented separately. Earlier application is permitted. The Company is
      currently evaluating the impact of this update on the financial
      statements.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (iv)  | In June 2009, new guidance relating to the accounting for
      transfers of financial assets was issued. The new guidance, which was
      issued as, Accounting for Transfers of Financial Assets, has not
      yet been adopted into Codification. The new standard eliminates the
      concept of a qualifying special-purpose entity, changes the requirements
      for derecognizing financial assets, and requires additional disclosures in
      order to enhance information reported to users of financial statements by
      providing greater transparency about transfers of financial assets,
      including securitization transactions, and an entitys continuing
      involvement in and exposure to the risks related to transferred financial
      assets. The new guidance is effective for fiscal years beginning after
      November 15, 2009. The adoption of the standard did not have impact on the
      Companys financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

10

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|3. | Share Capital                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | Common Shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | In July 2009, the Company issued 2,337,500 common shares
      at C$0.65 per share for proceeds of $1,396,646 (C$1,519,375).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | During the three-month period from September to December
      2009, 400,000 stock options were exercised and the Company issued 400,000
      common shares at C$0.35 per share for proceeds of $131,085
      (C$140,000).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | In January 2010, 700,000 stock options were exercised and
      the Company issued 700,000 common shares at C$0.35 per share for proceeds
      of $234,113 (C$245,000).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | On June 1, 2010, the Company issued 5,000,000 units at
      C$1.60 per unit for gross proceeds of $7,634,316 (C$8,000,000) and
      incurred professional fees of $45,765 as share issuance costs. Each unit
      consisted of one common share, one-quarter of one Class A purchase warrant
      and one-quarter of one Class B purchase warrant. Each whole Class A
      warrant is exercisable to acquire one additional common share of the
      Company at a price of C$1.75. Each Class B warrant is exercisable to
      acquire one additional common share of the Company at a price of C$2.00.
      Both Class A and Class B warrants expire December 1, 2011. The aggregate
      fair value of the Class A and B purchase warrants was $1,726,518 and the
      Company allocated the remaining proceeds of $5,907,798 to the common
      shares. The fair value of the warrants was determined using the
      Black-Scholes option pricing model with assumptions as set out
      below:

|                    | September 30, 2010
|------------------- | ------------------
|                    |                   
|Expected life years | 1.5               
|Interest rate       | 1.37%             
|Volatility          | 114%              
|Dividend yield      | Nil               

In September 2010, 50,000 stock options
  were exercised and the Company issued 50,000 common shares at C$0.26 per share
  for proceeds of $12,487 (C$13,000).

In connection with the guidance of ASC
  815-40-15, as warrants are exercisable in a currency other than the functional
  currency of the Company and thus do not meet the fixed-for-fixed criteria of
  the guidance. As a result, the Company was required to separately account for
  the Class A and B warrants issued in connection with the private placement noted
  above as a derivative instrument liability.

11

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|3. | Share Capital (continued)                                                                                                                                                                                                 
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                           
|   | Stock Options                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                           
|   | In April 2010, the Company granted 50,000 stock options
      to consultants, which are exercisable at C$1.24 per share and expire on
      April 18, 2015. The total fair value of the options granted was
      $46,275.

| |                                                              |  |           |   |  | Weighted        | 
| | ------------------------------------------------------------ |  | --------- | - |  | --------------- | 
| |                                                              |  |           |   |  | Average         | 
| |                                                              |  |           |   |  | Exercise Price  | 
| |                                                              |  | Shares    |   |  | Per
      Share | 
| | Options outstanding and exercisable,
      December 31, 2008 |  | 2,300,000 |   |  | C$0.57          | 
| | Granted                                                      |  | 1,950,000 |   |  | C$0.26          | 
| | Exercised                                                    |  | (400,000  | ) |  | C$0.35          | 
| | Options outstanding and exercisable, December 31, 2009       |  | 3,850,000 |   |  | C$0.44          | 
| | Granted                                                      |  | 50,000    |   |  | C$1.24          | 
| | Exercised                                                    |  | (750,000  | ) |  | C$0.34          | 
| |                                                              |  |           |   |  |                 | 
| | Options outstanding and exercisable, September 30, 2010      |  | 3,150,000 |   |  | C$0.47          | 

The following table summarizes
  information about stock options outstanding at September 30, 2010:

|          |  |                  |  | Weighted-Average |                 
|--------- |  | ---------------- |  | ---------------- | ----------------
|          |  | Weighted Average |  | Contractual Life |                 
|Number    |  | Exercise Price   |  | (Years)          | Expiry Date     
|          |  |                  |  |                  |                 
|1,200,000 |  | C$0.77           |  | 0.55             | April 20, 2011  
|1,900,000 |  | C$0.26           |  | 3.33             | January 28, 2014
|50,000    |  | C$1.24           |  | 4.55             | April 18, 2015  
|          |  |                  |  |                  |                 
|3,150,000 |  | C$0.47           |  | 2.56             |                 

The Company applies the fair value
  method in accounting for its stock options granted to directors, officers and
  consultants using the Black-Scholes option pricing model. The stock-based
  compensation expense was $46,275 (2009 - $209,055). The fair value of stock
  options granted as above is calculated using the following weighted average
  assumptions:

|                    | September 30, | September 30,
|------------------- | ------------- | -------------
|                    | 2010          | 2009         
|                    |               |              
|Expected life years | 5             | 5            
|Interest rate       | 1.95%         | 2.03%        
|Volatility          | 106%          | 70.30%       
|Dividend yield      | 0%            | 0%           

As at September 30, 2010, the aggregate
  intrinsic value of the outstanding exercisable options was approximately
  $4,797,000 (2009 - $1,560,000). The total intrinsic value of options exercised
  during the nine months ended September 30, 2010 was approximately $435,000 (2009
  - $77,000).

12

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|3. | Share Capital (continued)
        Warrants                               
|-- | -------------------------------------------------------------------------
|   |                                                                          
|   | The following is a summary of warrant status at September
      30, 2010:

| |                                                    |  |           |  |  | Weighted-       |  |  | Average   |  |  |                  | 
| | -------------------------------------------------- |  | --------- |  |  | --------------- |  |  | --------- |  |  | ---------------- | 
| |                                                    |  |           |  |  | Average         |  |  | Contract- |  |  |                  | 
| |                                                    |  |           |  |  | Exercise Price  |  |  | ual Life  |  |  |                  | 
| |                                                    |  | Shares    |  |  | Per
      Share |  |  | (Years)   |  |  | Expiry Date      | 
| |                                                    |  |           |  |  |                 |  |  |           |  |  |                  | 
| | Outstanding and exercisable, January 1,
      2010 |  | -         |  |  | -               |  |  | -         |  |  | -                | 
| | Issued:                                            |  |           |  |  |                 |  |  |           |  |  |                  | 
| | Class A                                            |  | 1,250,000 |  |  | C$1.75          |  |  | 1.50      |  |  | December 1, 2011 | 
| | Class B                                            |  | 1,250,000 |  |  | C$2.00          |  |  | 1.50      |  |  | December 1, 2011 | 
| |                                                    |  |           |  |  |                 |  |  |           |  |  |                  | 
| | Outstanding and exercisable, September 30, 2010    |  | 2,500,000 |  |  | C$1.88          |  |  | -         |  |  |                  | 

As at September 30, 2010, the aggregate
  intrinsic value of the outstanding exercisable warrants was approximately
  $447,000 (2009 - $Nil).

13

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|4. | Commitments and Contingencies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | The Company has acquired a number of mineral properties
      outright and has acquired exclusive rights to explore, develop and mine
      the Property under various agreements with landowners.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Agreements are typically subject to sliding scale
      royalties on either gross or net smelter returns ranging from 1.0% to
      7.5%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | The Company ceased making property payments and advance
      minimum royalty payments after successfully concluding moratorium
      agreements with a number of the landowners in 2000. The moratorium
      agreements expired toward the end of 2003. The total advance minimum
      royalty owing from 2003 to the end of 2008 was $714,137. The Company paid
      advance minimum royalties of $174,176 in 2009. The advance minimum royalty
      owing is estimated to be $153,000 for 2010.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | In 2007, the Company reached an agreement with a
      landowner to amend the terms of the lease agreement. Under the terms of
      the amendment, the Company has been granted an extension of twenty years
      and has paid $100,000 owed from 2005. In addition, the Company is not
      required to pay advance royalty during the two- year period until April
      23, 2008 and the Company will receive a credit representing 50% of all
      advance minimum royalty paid and use it against the future production
      royalties. The Company recommenced the advance minimum royalty payment,
      and paid the landowner $100,000 in 2008 and $100,000 in 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | A mining lease agreement with a group of landholders
      expired in 2004. The Company is currently in discussions with this group
      of landholders in an effort to reach a new agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | The Company has agreed to issue 100,000 common shares as
      a finders fee upon commencement of commercial production on the Property
      in connection with certain property acquisitions. As of December 31, 2009,
      commercial production has not commenced and no shares have been
      issued.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | In 2004, the Company entered into an agreement with the
      President of the Company to issue 300,000 bonus shares upon completion of
      certain milestones. Upon receipt by the Company of a bankable feasibility
      study and the decision to place the Property into commercial production, a
      bonus of 150,000 common shares would be issued. Upon commencement of
      commercial production on the Property, a bonus of 150,000 common shares
      would be issued. In May 2010, the Company entered into an amendment to the
      agreement whereby the 300,000 bonus shares would alternatively be issuable
      upon a change of control transaction or upon a sale of all or
      substantially all of the Companys assets, having a value at or above
      $1.00 per share of the Company, with a further 300,000 bonus shares being
      issuable in the event the change of control transaction or asset sale
      occurred at a value at or above $1.50 per share. The agreement is for a
      term of three years and shall automatically renew for two years. As at
      September 30, 2010, the milestones had not been reached and no accrual was
      made in connection with these arrangements.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|5. | Related Party Transactions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Except as noted elsewhere in these consolidated financial
      statements, related party transactions are disclosed as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | For the three and nine months ended September 30, 2010, $
      32,500 and $102,600 (2009 - $30,900 and $87,300) was paid to Mr. H. L.
      Klingmann for services as President of the Company and $4,300 and $13,000
      (2009 - $4,100 and $12,000) was paid to Mr. Chester Shynkaryk for
      consulting services to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | All of the above transactions and balances are in the
      normal course of operations and are measured at the exchange amount, which
      is the amount of consideration established and agreed to by the related
      parties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

14

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|6. | Supplemental Disclosure Cash Flows
      Disclosure
|-- | ---------------------------------------------------

| |                                                                                                            |   |               |  |   |               |  |   | Cumulative         | 
| | ---------------------------------------------------------------------------------------------------------- | - | ------------- |  | - | ------------- |  | - | ------------------ | 
| |                                                                                                            |   |               |  |   |               |  |   | Amounts From Date  | 
| |                                                                                                            |   | Nine-month    |  |   | Nine-month    |  |   | of Inception       | 
| |                                                                                                            |   | period ended  |  |   | period ended  |  |   | (November 21,      | 
| |                                                                                                            |   | September 30, |  |   | September 30, |  |   | 1985) through      | 
| |                                                                                                            |   | 2010          |  |   | 2009          |  |   | September 30, 2010 | 
| |                                                                                                            |   |               |  |   |               |  |   |                    | 
| | Cash paid during year for:                                                                                 |   |               |  |   |               |  |   |                    | 
| | Interest                                                                                                   | $ | -             |  | $ | -             |  | $ | 1,192,911          | 
| | Income taxes                                                                                               | $ | -             |  | $ | -             |  | $ | -                  | 
| |                                                                                                            |   |               |  |   |               |  |   |                    | 
| | Non-cash financing and investing activities:                                                               |   |               |  |   | -             |  |   |                    | 
| | Reclassification
      of derivative
      liability 
                   for
      exercised stock options | $ | 438,822       |  | $ | 78,533        |  | $ | 595,656            | 
| | Stock option
      compensation                                                                            | $ | 46,275        |  | $ | 209,055       |  | $ | 1,416,448          | 
| | Financing charges
      related
      to 
                   modification
      of warrants term           | $ | -             |  | $ | -             |  | $ | 889,117            | 
| | Exchange of notes
      for
      common 
                   shares                                        | $ | -             |  | $ | -             |  | $ | 1,727,282          | 
| | Exchange of note
      for future
      royalty 
                   payments                               | $ | -             |  | $ | -             |  | $ | 150,000            | 
| | Common shares
      issued for
      mineral 
                   property                                  | $ | -             |  | $ | -             |  | $ | 304,811            | 
| | Mineral property
      acquired
      through 
                   the
      issuance of long-term debt     | $ | -             |  | $ | -             |  | $ | 1,084,833          | 
| | Common shares
      issued
      upon 
                   conversion
      of convertible debt             | $ | -             |  | $ | -             |  | $ | 414,917            | 
| | Asset retirement obligations                                                                               | $ | 11,986        |  | $ | 10,059        |  | $ | 189,550            | 

15

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|7. | Restatements
|-- | ------------
|   |             
|   | a)          
|   |             
|   |             
|   |             
|   |             
|   |             
|   |             
|   |             
|   |             
|   |             
|   |             

16

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|7. | Restatements (continued)                                                                                                                     
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                              
|   | The consolidated balance sheet of the Company as at
      December 31, 2009 has been restated for the effect of this change as
      follows:

| |                            |   | As          |   |   |            |   |   |             |  
| | -------------------------- | - | ----------- | - | - | ---------- | - | - | ----------- | -
| |                            |   | previously  |   |   |            |   |   |             |  
| |                            |   | reported    |   |   | Adjustment |   |   | Restated    |  
| | Derivative liability       | $ | -           |   | $ | 2,695,602  |   | $ | 2,695,602   |  
| |                            |   |             |   |   |            |   |   |             |  
| | Additional paid in capital | $ | 4,195,106   |   | $ | (1,064,557 | ) | $ | 3,130,549   |  
| |                            |   |             |   |   |            |   |   |             |  
| | Ending accumulated deficit | $ | (51,837,026 | ) | $ | (1,631,045 | ) | $ | (53,468,071 | )

The impact of the adoption of ASC
  815-40-15 is of a non-cash nature. Therefore, there is no change in total
  operating, investing, and financing activities on the consolidated statement of
  cash flows.

The fair value of the derivative
  liability has been determined using the Black-Scholes option pricing model using
  the following assumptions:

| |                                       | December 31, 2009 | January 1, 2009 
| | ------------------------------------- | ----------------- | ----------------
| |                                       |                   |                 
| | Risk-free interest rate               | 1.47 to 2.77%     | 1.09%           
| | Expected life of derivative liability | 1 to 4.1years     | 1.1 to 2.3 years
| | Expected volatility                   | 60% to 148%       | 116% to 152%    
| | Dividend rate                         | 0.00%             | 0.00%           

17

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage
      company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|7. | Restatement (continued)
|-- | -----------------------

b) Restatement related to the unaudited
  interim consolidated financial statements for the period ended September 30,
  2010 and 2009:

| | (i)   | Subsequent to the issuance of the Companys unaudited
      interim consolidated financial statements for the period ended September
      30, 2010, management discovered an error in the general and administrative
      expense. The Company has consumed and received goods and services of
      $237,944 for the three months period ended June 30, 2010 but did not
      record the amounts until for the three months period ended September 30,
      2010. In addition, the Company had revised the stock based compensation
      expense from $41,383 to $46,275 for the three months ended September 30,
      2010 when the amount should have been recorded for the three months ended
      June 30, 2010. As a result of these errors, general and administrative
      expense for the three months ended on September 30, 2010 was overstated
      by$242,836.                
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (ii)  | The Company had previously expensed share issuance costs
      of $21,715 as general and administrative expense for the three-month
      period ended June 30, 2010. As a result, general and administrative
      expense and share capital for the nine-month period ended September 30,
      2010 were overstated by $21,715.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (iii) | During the nine-month period ended September 30, 2010, a
      total of 750,000 stock options included in the derivative liability were
      exercised. Upon exercise of these options, the portion of the derivative
      liability that pertained to these options was re-measured and recorded at
      its fair value of $438,822. The Company measured the fair value of the
      derivative liability pertaining to the options exercised using the Black-
      Scholes pricing model with the following range of assumptions: expected
      volatility  33% - 78%, expected life  0.01  0.06 years, risk-free
      discount rate  1.17% - 1.29%, dividend yield  0.00%.                                                                                                                                                                                                           
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (iv)  | As explained in Note 7(a) above, management discovered an
      error in connection with the guidance of ASC 815-40-15 in respect of the
      Companys outstanding stock options and warrants. As at January 1, 2009,
      the date on which the guidance of ASC 815-40-15 became effective for the
      Company, these stock options and warrants met the criteria of a derivative
      instrument liability because they were exercisable in a currency other
      than the functional currency of the Company and thus do not meet the
      fixed-for-fixed criteria of that guidance. As a result, the Company was
      required to separately account for the stock options and warrants as a
      derivative instrument liability recorded at fair value and
      marked-to-market each period with the changes in the fair value each
      period charged or credited to income.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |       | As of September 30, 2010 and September 30, 2009, the
      Company had re-measured the remaining outstanding options and determined
      the fair value of the derivative liability to be $5,153,151 and $2,331,878
      respectively using the Black-Scholes option pricing model using the
      following assumptions:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

| |                                       | September 30, 2010 | September 30, 2009
| | ------------------------------------- | ------------------ | ------------------
| |                                       |                    |                   
| | Risk-free interest rate               | 1.36% -2.01%       | 0.25% to 2.39%    
| | Expected life of derivative liability | 0.55 to 4.55 years | 0.34 to 4.33 years
| | Expected volatility                   | 65% to 115%        | 93% to 151%       
| | Dividend rate                         | 0.00%              | 0.00%             

18

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|7. | Restatements (continued)
|-- | ------------------------

b) Restatement related to the unaudited
  interim consolidated financial statements for the period ended September 30,
  2010 and 2009 (continued): As of September 30, 2010, the Company had re-measured
  the remaining outstanding warrants and determined the fair value of the
  derivative liability to be $1,885,326 (2009 - $Nil) using the Black-Scholes
  option pricing model using the following assumptions:

|                                      | September 30, 2010
|------------------------------------- | ------------------
|                                      |                   
|Risk-free interest rate               | 1.36%             
|Expected life of derivative liability | 1.17 years        
|Expected volatility                   | 80%               
|Dividend rate                         | 0.00%             

The unaudited interim consolidated
  balance sheet of the Company as at September 30, 2010 has been restated for the
  effect of this change as follows:

| |                            |   | As previously |   |   |            |   |   |             |  
| | -------------------------- | - | ------------- | - | - | ---------- | - | - | ----------- | -
| |                            |   | reported      |   |   | Adjustment |   |   | Restated    |  
| | Derivative liability       | $ | -             |   | $ | 7,038,477  |   | $ | 7,038,477   |  
| | Share capital              | $ | 56,335,982    |   | $ | (21,715    | ) | $ | 56,314,267  |  
| | Additional paid in capital | $ | 5,967,899     |   | $ | (2,398,528 | ) | $ | 3,569,371   |  
| | Ending accumulated deficit | $ | (54,502,741   | ) | $ | (4,618,234 | ) | $ | (59,120,975 | )

The unaudited interim consolidated
  statements of loss have been restated for the effect of this change as follows:

| |                                                      |   | As previously |   |   |            |   |   |            |  
| | ---------------------------------------------------- | - | ------------- | - | - | ---------- | - | - | ---------- | -
| |                                                      |   | reported      |   |   | Adjustment |   |   | Restated   |  
| | For the three months ended September 30,
      2010: |   |               |   |   |            |   |   |            |  
| | Increase in fair value of derivative liability       | $ | -             |   | $ | (2,429,443 | ) | $ | (2,429,443 | )
| | General and administrative
      expenses            | $ | (949,291      | ) | $ | 242,836    |   | $ | (706,455   | )
| | Net loss and comprehensive loss for the period       | $ | (938,520      | ) | $ | (2,186,607 | ) | $ | (3,125,127 | )
| | Loss per share, basic and
      diluted              | $ | (0.01         | ) | $ | (0.02      | ) | $ | (0.03      | )
| | For the three months ended September 30, 2009:       |   |               |   |   |            |   |   |            |  
| | Increase in fair value of
      derivative liability | $ | -             |   | $ | (629,533   | ) | $ | (629,533   | )
| | Net loss and comprehensive loss for the period       | $ | (427,616      | ) | $ | (629,533   | ) | $ | (1,057,149 | )
| | Loss per share, basic and
      diluted              | $ | (0.01         | ) | $ | -          |   | $ | (0.01      | )

19

---

GOLDEN QUEEN MINING CO. LTD.(an exploration stage company)Notes to Interim Consolidated Financial StatementsFor the Nine Months Ended September 30, 2010(Unaudited)

|7. | Restatements (continued)
|-- | ------------------------

b) Restatement related to the unaudited
  interim consolidated financial statements for the period ended September 30,
  2010 and 2009 (continued):

The unaudited interim consolidated statements of loss
  have been restated for the effect of this change as follows (continued):

| |                                                                                                                |   | As previously |   |   |                   |   |   |             |  
| | -------------------------------------------------------------------------------------------------------------- | - | ------------- | - | - | ----------------- | - | - | ----------- | -
| |                                                                                                                |   | reported      |   |   | Adjustment        |   |   | Restated    |  
| | For the nine months ended September 30, 2010:                                                                  |   |               |   |   |                   |   |   |             |  
| | Increase in fair value of
      derivative liability                                                           | $ | -             |   | $ | (3,008,904        | ) | $ | (3,008,904  | )
| | General and administrative expenses                                                                            | $ | (2,669,479    | ) | $ | 21,715            |   | $ | (2,647,764  | )
| | Net loss and comprehensive
      loss for the period                                                           | $ | (2,665,715    | ) | $ | (
      2,987,189 | ) | $ | (5,652,904  | )
| | Cumulative amounts from date of
      inception 
         (November 21, 1985) through September
      30, 2010 | $ | (53,814,641   | ) | $ | (5,082,490        | ) | $ | (58,897,131 | )
| | Loss per share, basic and
      diluted                                                                        | $ | (0.03         | ) | $ | (0.03             | ) | $ | (0.06       | )
| | For the nine months ended September 30, 2009:                                                                  |   |               |   |   |                   |   |   |             |  
| | Increase in fair value of
      derivative liability                                                           | $ | -             |   | $ | (1,653,275        | ) | $ | (1,653,275  | )
| | Net loss and comprehensive loss for the period                                                                 | $ | (1,622,107    | ) | $ | (1,653,275        | ) | $ | (3,275,382  | )
| | Loss per share, basic and
      diluted                                                                        | $ | (0.02         | ) | $ | (0.02             | ) | $ | (0.04       | )

The impact of the adoption of ASC
  815-40-15 is of a non-cash nature. Therefore, there is no change in total
  operating, investing, and financing activities on the consolidated statement of
  cash flows.

The unaudited interim consolidated
  statements of cash flows of the Company for the nine months ended September 30,
  2010 has been restated for the effect of the errors described in Note 7(b) (ii)
  above:

| |                                                                                                                                                           |   | As previously |   |   |            |   |   |             |  
| | --------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------- | - | - | ---------- | - | - | ----------- | -
| |                                                                                                                                                           |   | reported      |   |   | Adjustment |   |   | Restated    |  
| | Cash flows used in operating activities                                                                                                                   | $ | (2,481,824    | ) | $ | 21,715     |   | $ | (2,460,109  | )
| |                                                                                                                                                           |   |               |   |   |            |   |   |             |  
| | Cash used in operating activities,
      cumulative 
      amount from date of inception (November 
      21, 1985)
      through September 30, 2010      | $ | (40,557,998   | ) | $ | 21,715     |   | $ | (40,536,283 | )
| |                                                                                                                                                           |   |               |   |   |            |   |   |             |  
| | Cash flows provided by financing activities                                                                                                               | $ | 7,856,866     |   | $ | (21,715    | ) | $ | 7,835,151   |  
| |                                                                                                                                                           |   |               |   |   |            |   |   |             |  
| | Cash provided by financing activities, 
      cumulative amount from date of inception 
      (November 21, 1985)
      through September 
      30, 2010 | $ | 58,740,487    |   | $ | (21,715    | ) | $ | 58,718,772  |  

20

---

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

The following discussion of the operating results and financial
position of Golden Queen Mining Co. Ltd. (the Company) is as at November 17,
2010 and should be read in conjunction with the consolidated financial
statements of the Company for the quarter ended September 30, 2010 and the notes
thereto.

The information in this Management Discussion and Analysis is
prepared in accordance with U.S. generally accepted accounting principles and
all amounts herein are in US$ unless otherwise noted.

The Soledad Mountain Project

The Company is proposing to develop a gold-silver, open pit,
heap leach operation on its Soledad Mountain property (Property), located just
outside the town of Mojave in Kern County in southern California. Every element
of the Soledad Mountain Project (Project) has been rethought and reengineered
in the past five years in an effort to find sound technical and cost-effective
solutions that will ensure a viable mining operation at foreseeable gold and
silver prices. The review has been supported and complimented by a substantial
amount of work done by independent engineers and contractors. This phase of the
technical work was completed toward the end of 2008.

Permitting Update

A detailed review of approvals and permits required for the
Project is provided in the Companys latest Form 10-K filing with the SEC. The
following is therefore only a note on the supplemental Environmental Impact
Report (SEIR), which has been prepared for the Project.

The Company completed an Application for a revised Surface
Mining and Reclamation Plan in April 2007. The Kern County Planning Department
determined that changes proposed for the Project since the Conditional Use
Permits were issued in 1997 constituted new information that required evaluation
of potential impacts in a Supplemental Environmental Impact Report (SEIR). The
draft SEIR was finally completed and distributed in January 2010. The Kern
County Planning Commission formally considered the Project at its regularly
scheduled meeting in Bakersfield on April 8. At the meeting, the Commission,
consisting of a panel of three commissioners, unanimously approved the Project.
Two appeals were subsequently filed against the Commissions decision and the
Project was scheduled to be reconsidered before the Kern County Board of
Supervisors on May 25. Both appeals were withdrawn before the day of the meeting
and the decision made by the Planning Commission therefore became final.

The Lahontan Regional Water Quality Control Board (the Board)
unanimously approved Waste Discharge Requirements and a Monitoring and Reporting
Program (the WDRs) for the Soledad Mountain Project on July 14. The Board
recommended adopting an order approving the WDRs, and the order was subsequently
signed by the Executive Officer of the Board and is currently in effect. The
order approving the WDRs is a critical authorization for the construction and
operation of, and establishes the discharge and monitoring standards for, the
heap leach pads, rock stockpiles and other activities that have the potential to
affect surface and ground waters.

The Company also requires Authority to Construct permits to
begin mining and processing operations on its Property. The Companys consulting
engineers are completing applications for these permits and it is expected that
these will be submitted to Eastern Kern Air Pollution Control District (EKAPCD)
in early December 2010. ECAPCD can now prepare and issue Authority to Construct
permits as the SEIR has been certified. The Authority to Construct permits are
converted to a Permit To Operate after construction has been completed and
subject to inspection by the ECAPCD.

---

It is important to note that the Bureau of Land Management (the
BLM) has confirmed that its Record of Decision approving the Plan of
Operations under NEPA in November 1997 remains valid and that no additional
reviews or approvals are required from the BLM before GQM can proceed with the
Project.

Results of Operations

Following are the results of operations for the three month
period and nine month period ended September 30, 2010, and the corresponding
periods ended September 30, 2009.

The Company had no revenue from operations.

During the quarter, the Company incurred general and
administrative expenses of $706,455 (2009 - $431,324). For the nine month period
ended September 30, 2010 the Company incurred general and administrative
expenses of $22,647,764 (2009 - $1,622,016).

Costs were significantly higher for the quarter and nine month
period ended September 30, 2010 when compared with the same period in 2009, due
to the following non-recurring costs:

- Legal fees were incurred in support of ongoing efforts to secure permits
  for the Project, and
- Consulting engineering fees were higher due to the significant amount of
  detailed engineering completed for Project facilities. The detailed
  engineering allows contractors to provide cost estimates for construction of
  the facilities.

Interest income of $14,767 (2009 - $7,061) was higher by $7,706
as there was more cash on deposit. Interest rates remained low during the
quarter. There was no interest expense during the quarter.

The Company incurred a net loss of $3,125,127 (or $0.03 per
share) during the quarter and $5,668,654 (or $0.06 per share) during the nine
month period ended September 30, 2010, as compared to a net loss of $1,057,149
(or $0.01 per share) during the third quarter of 2009 and $3,275,382 during the
nine month period ended September 30, 2009 (or $0.04 per share).

Summary of Quarterly Results

Results for the eight most recent quarters are set out in the
table below.

|Results for the quarter ended on: | Sept. 30, 2010 | June 30, 2010 | March 31, 2010 | Dec. 31, 2009
|--------------------------------- | -------------- | ------------- | -------------- | -------------
|Item                              | $              | $             | $              | $            
|Revenue                           | Nil            | Nil           | Nil            | Nil          
|Net loss for the quarter          | 3,125,127      | 2,406,367     | 326,305        | 1,239,360    
|Net loss per share                | 0.03           | 0.03          | 0.00           | 0.02         

|Results for the quarter ended on: | Sept. 30, 2009 | June 30, 2009 | March 31, 2009 | Dec. 31, 2008
|--------------------------------- | -------------- | ------------- | -------------- | -------------
|Item                              | $              | $             | $              | $            
|Revenue                           | Nil            | Nil           | Nil            | Nil          
|Net loss for the quarter          | 1,057,149      | 1,230,829     | 987,404        | 1,223,439    
|Net loss per share                | 0.01           | 0.01          | 0.01           | 0.01         

The results of operations can vary from quarter to quarter
depending upon the nature, timing and cost of activities undertaken during the
quarter and whether or not the Company incurs gains or losses on foreign
exchange grants stock options or makes adjustments on quarterly or annual
financial statements.

---

Reclamation Financial Assurance and Asset Retirement
Obligation

The Company provided reclamation financial assurance in the
form of an Irrevocable Payment Bond Certificate with Union Bank of California in
the amount of $286,653 on October 21, 2009 for 2010. The financial assurance is
reassessed annually and the estimate for reclamation of historical disturbances
on the property is $283,809 for 2011.

The asset retirement obligation accrual is estimated at $189,550
  and this is shown as a liability on the consolidated balance sheet. The actual
  obligation could differ materially from these estimates.

Advance Minimum Royalties

Advance minimum royalties of $22,167 were paid to landholders
in the third quarter of 2010.

A mining lease agreement with one group of landholders expired
in 2004 and the Company has prepared a new mining lease agreement for discussion
with the group of landholders.

Mining lease agreements with groups of landholders expired in
June and July of 2010 and discussions are under way with these groups of
landholders for an extension of the agreements.

Off-balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

Recently Issued Accounting Standards

| | (i)   | In January 2010, the FASB issued ASU No. 2010-06,
      Improving Disclosures about Fair Value Measurements, which requires
      additional disclosures about the amounts of and reasons for significant
      transfers in and out of Level 1 and Level 2 fair value measurements. This
      standard also clarifies existing disclosure requirements related to the
      level of disaggregation of fair value measurements for each class of
      assets and liabilities and disclosures about inputs and valuation
      techniques used to measure fair value for both recurring and non-recurring
      Level 2 and Level 3 measurements. Since this new accounting standard only
      required additional disclosure, the adoption of the standard did not
      impact the Companys consolidated financial statements. This standard will
      require additional disclosure and require the Company to present
      disaggregated information about activity in Level 3 fair value
      measurements on a gross basis, rather than one net amount.                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | (ii)  | In February 2010, FASB issued Accounting Standards Update
      (ASU) 2010-09, Subsequent Event (Topic 855) Amendments to Certain
      Recognition and Disclosure Requirements. ASU 2010-09 removes the
      requirement for an SEC filer to disclose a date through which subsequent
      events have been evaluated in both issued and revised financial
      statements. Revised financial statements include financial statements
      revised as a result of either correction of an error or retrospective
      application of GAAP. All of the amendments in ASU 2010-09 are effective
      upon issuance of the final ASU, except for the use of the issued date for
      conduit debt obligors. That amendment is effective for interim or annual
      periods ending after June 15, 2010. The adoption of this standard did not
      have a material effect on the Companys consolidated financial
      statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | (iii) | In April 2010, the FASB issued Accounting Standards
      Update 2010-13, Compensation  Stock Compensation (Topic 718). The
      objective of this update is to address the classification of an employee
      share-based payment award with an exercise price denominated in the
      currency of a market in which the underlying equity security trades. It
      provides guidance on the classification of a share-based payment award as
      either equity or a liability. A share-based payment award that contains a
      condition that is not a market, performance, or service condition is
      required to be classified as a liability. The amendments in this update
      are effective for fiscal years, and interim periods within those fiscal
      years, beginning on or after December 15, 2010. The amendments in this
      update should be applied by recording a cumulative-effect adjustment to
      the opening balance of retained earnings. The cumulative- effect
      adjustment should be calculated for all awards outstanding as of the
      beginning of the fiscal year in which the amendments are initially
      applied, as if the amendments had been applied consistently since the
      inception of the award. The cumulative-effect adjustment should be
      presented separately. Earlier application is permitted. The Company is
      currently evaluating the impact of this update on the financial
  statements.

---

| | (iv) | In June 2009, new guidance relating to the accounting for
      transfers of financial assets was issued. The new guidance, which was
      issued as, Accounting for Transfers of Financial Assets, has not
      yet been adopted into Codification. The new standard eliminates the
      concept of a qualifying special-purpose entity, changes the requirements
      for derecognizing financial assets, and requires additional disclosures in
      order to enhance information reported to users of financial statements by
      providing greater transparency about transfers of financial assets,
      including securitization transactions, and an entitys continuing
      involvement in and exposure to the risks related to transferred financial
      assets. The new guidance is effective for fiscal years beginning after
      November 15, 2009. The adoption of the standard did not have impact on the
      Companys financial statements.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Stock Option Plan

The Companys current stock option plan (the Plan) was
adopted by management of the Company in 2008 and approved by shareholders of the
Company in 2009. The Plan provides a fixed number of 7,200,000 common shares of
the Company that may be issued pursuant to the grant of stock options. The
exercise price of stock options granted under the Plan shall be determined by
the Companys Board of Directors, but shall not be less than the volume weighted
average trading price of the Companys shares on the Toronto Stock Exchange for
the five trading days immediately prior to the date of the grant. The expiry
date of a stock option shall be the date so fixed by the Board subject to a
maximum term of five years. The Plan provides that stock options will terminate
on the earlier of the expiry of the term and (i) 12 months from the date an
option holder dies, (ii) 90 days from the date from the date the option holder
ceases to act as a director or officer of the Company, or (iii) 60 days from the
date the option holder ceases to be employed, or engaged as a consultant, by the
Company.

The Company granted 1,950,000 stock options to directors, officers
  and consultants of the Company pursuant to the Plan on January 28, 2009. The
  options are exercisable at a price of C$0.26 per share for a period of 5 years
  from the date of grant. The Company also granted 50,000 stock options to a consultant
  of the Company pursuant to the Plan on April 19, 2010. The options are exercisable
  at a price of C$1.24 per share for a period of 5 years from the date of grant.

Transactions with Related Parties

For the three and nine months ended September 30, 2010, $
32,500 and $102,600 (2009 - $30,900 and $87,300) was paid to Mr. H. L. Klingmann
for services as President of the Company and $4,300 and $13,000 (2009 - $4,100
and $12,000) was paid to Mr. Chester Shynkaryk for consulting services to the
Company.

The Company amended a consulting services agreement originally
entered into in 2004 with Mr. H. Lutz Klingmann, the President of the Company,
in May of 2010. Under the original agreement, upon receipt by the Company of a
bankable feasibility study and the decision to place the Property into
commercial production, a bonus of 150,000 common shares would be issued and upon
commencement of commercial production on the Property, a bonus of 150,000 common
shares would be issued. Pursuant to the amended agreement, an alternative
300,000 bonus shares would be issuable upon a change of control transaction or upon a sale of all or substantially all of the
Companys assets, having a value at or above C$1.00 per share of the Company,
with a further 300,000 bonus shares being issuable in the event the change of
control transaction or asset sale occurred at a value at or above C$1.50 per
share. As at September 30, 2010, the milestones had not been reached and no
accrual was made in connection with these arrangements.

---

Fair Value of Financial Instruments

The carrying amount reported in the balance sheets for cash and
cash equivalents, receivables, accounts payable and accrued liabilities
approximates fair value because of the immediate or short-term maturity of these
financial instruments. The company does not hold any bank or non-bank
asset-backed commercial paper. The fair value of the reclamation financial
assurance approximates carrying value because the stated interest rate reflects
recent market conditions. It is the opinion of management that the Company is
not exposed to significant interest, currency or credit risk arising from the
use of these financial instruments.

Private Placement

The Company completed a non-brokered private placement with
Gammon Gold Inc. on June 1, 2010, whereby Gammon Gold purchased 5,000,000 units
of the Company at a price of C$1.60 per unit for total proceeds of $7,634,316
(C$8,000,000). Each unit consists of one common share, one quarter of one Class
A Warrant, and one quarter of one Class B Warrant. Each Class A Warrant entitles
Gammon Gold to purchase a common share at a price of C$1.75 for a period of 18
months from the closing date. Each Class B Warrant entitles Gammon Gold to
purchase one common share at a price of C$2.00 for a period of 18 months from
the closing date. The aggregate fair value of the Class A and B purchase
warrants was $1,726,518 and the amount has been recorded as derivative liability
and the Company allocated the remaining proceeds of $5,907,798 to the common
shares.

Subject to certain conditions, Gammon Gold Inc. was granted the
right to participate in future financings to maintain its equity position in the
Company.

Liquidity and Capital Resources

The Company held $7,808,244 in cash and cash equivalents on
September 30, 2010.

Cash used in Operating Activities

During the period ended September 30, 2010, the Company
incurred significant expenditures in legal fees in connection with permit
approvals, and for detailed engineering fees in connection with Project
facilities.

Cash from Financing Activities:

Cash was received from financing activities during the nine
months ended September 30, 2010 and for the comparable period in 2009 as
follows:

- $246,600 pursuant to the exercise of options on 750,000 shares @ C$0.35
  and 50,000 shares @ $0.26 ($16,252 pursuant to the exercise of options on
  100,000 shares @ C$0.35) and
- $7,634,316 pursuant to a private placement of units to Gammon Gold Inc.
  ($1,439,368 pursuant to a private placement of 2,337,500 shares to five
  placees).

Cash used in Investing Activities:

The Company did not incur expenditures in investing activities
during the three and nine months ended September 30, 2010 and 2009.

---

Working Capital

The Company has no long-term debt.

Management does not expect that additional cash will be required
  beyond cash currently on hand for ongoing work on permits for the Project, for
  paying advance minimum royalties, for additional property purchases, for detailed
  engineering of facilities for the Project and ongoing work on site, and for
  general corporate purposes to the end of 2011. Refer also to Outlookbelow.

Outstanding Share Data

The number of shares issued and outstanding and the fully
diluted share position are set out in the table below.

Golden Queen Mining Co. Ltd.

|                                                        | No. of      |                |                    
|------------------------------------------------------- | ----------- | -------------- | -------------------
|Item                                                    | Shares      |                |                    
|Shares issued and outstanding on Dec. 31, 2009          | 88,378,383  |                |                    
|Shares issued pursuant to the exercise of stock options | 700,000     |                |                    
|Gammon Gold Inc. private placement                      | 5,000,000   |                |                    
|Shares issued and outstanding on June 30, 2010          | 94,078,383  |                |                    
|Shares issued pursuant to the exercise of stock options | 50,000      |                |                    
|Shares issued and outstanding on September 30, 2010     | 94,128,383  | Exercise Price | Expiry Date        
|Gammon Gold Inc. warrants                               | 2,500,000   | C1.75 & C2.00  | 1/12/2011          
|Director and employee stock options                     | 1,200,000   | C$0.77         | 20/04/11           
|Director and employee stock options                     | 1,950,000   | C$0.26 & C1.24 | 28/01/14 & 18/04/15
|Shares to be issued as a finders fee                    | 100,000     | Not Applicable | Not Applicable     
|Bonus shares to H.L. Klingmann                          | 600,000     | Not Applicable | Not Applicable     
|Fully diluted on September 30, 2010                     | 100,478,383 |                |                    

The company's authorized share capital is 150,000,000 common
shares with no par value.

Outlook

The Company plans to put the Project into production as an open
pit heap leach operation and to construct facilities to process ore at a rate of
4,500,000 tonnes (5,000,000 tons) per year and these have been reduced from the
earlier planned mining rates. Projected life of the open pit heap leach
operation has increased from 7 years to 12 years. The Company also plans to
produce and sell aggregate for up to 30 years. These plans are subject to
management making a production decision.

Management is evaluating financing options with a view to
making a production decision as soon as all permits have been secured.

If permits are secured for the Project and a production
decision is made, the Company will need significant additional financing to
develop the Project into an operating mine. Capital costs for mining projects
are increasing rapidly and the Company is currently re-estimating these costs.
The Company believes that financing for the Project can be secured if gold and
silver prices remain at or above $600.00/oz and $12.50/oz respectively and these
are the prices used for the feasibility study base case cash flow projections
that were released on December 14, 2007. Gold and silver prices averaged
$972.35/oz and $14.67/oz in 2009 and closing prices on November 17, 2010 were
$1,213.00/oz and $17.95/oz respectively.

---

It is not expected that the Company will hedge any of its gold or silver production.

The ability of the Company to put the Project into production is subject to numerous risks, certain of which are disclosed in the Company’s latest Form 10-K filing with the SEC and amendments thereto. Readers should evaluate the
Company’s prospects in light of these and other risk factors.

Special Meeting of Shareholders

The Company held a special meeting of shareholders on September 1, 2010 at which the Company adopted new corporate Articles and increased its authorized capital to 150,000,000 common shares.

Application of Critical Accounting Estimates

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States. Because a precise determination of many assets and liabilities is dependent upon future events, the
preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment.

The financial statements have, in management’s opinion, been properly prepared within reasonable limits of materiality and within the framework of the significant accounting policies summarized below:

Mineral Property and Exploration Costs

Exploration costs are expensed as incurred. Development costs are expensed until it has been established that a mineral deposit is commercially mineable and a production decision has been made by the Company to implement a mining plan and develop a
mine, at which point the costs subsequently incurred to develop the mine on the property prior to the start of mining operations are capitalized.

The Company capitalizes the cost of acquiring mineral property interests, including undeveloped mineral property interests, until the viability of the mineral interest is determined. Capitalized acquisition costs are expensed if it is determined
that the mineral property has no future economic value. Exploration stage mineral interests represent interests in properties that are believed to potentially contain (i) other mineralized material such as measured, indicated or inferred resources
with insufficient drill hole spacing to qualify as proven and probable mineral reserves and (ii) other mine-related or green field exploration potential that are not an immediate part of measured or indicated resources.  The Company’s mineral
rights are generally enforceable regardless of whether or not proven and probable reserves have been established. The Company has the ability and intent to renew mineral rights where the existing term is not sufficient to recover undeveloped mineral
interests.

Capitalized amounts (including capitalized development costs) are also written down if future cash flows, including potential sales proceeds, related to the mineral property are estimated to be less than the property’s total carrying value.
Management reviews the carrying value of each mineral property periodically, and, whenever events or changes in circumstances indicate that the carrying value may not be recoverable, makes the necessary adjustments. Reductions in the carrying value
of a property would be recorded to the extent that the total carrying value of the mineral property exceeds its estimated fair value. A write-down of $167,898 in mineral property interests was recorded for the year ended December 31, 2009. There
was no write-down in mineral property interests recorded for the nine months ended September 30, 2010.

Asset Retirement Obligations

In accordance with the Accounting for Asset Retirement Obligations, the fair value of an asset retirement cost, and corresponding liability, should be recorded as part of the cost of the related long-lived asset and subsequently allocated to expense
using a systematic and rational method. The Company has recorded an asset retirement obligation to reflect its legal obligations related to future abandonment of its mineral property using estimated expected cash flow associated with the
obligation and discounting the amount using a credit-adjusted, risk-free
interest rate. At least annually, the Company reassesses the obligation to
determine whether or not a change in any estimated obligation is necessary. The
asset retirement obligation recorded as a liability on the Interim Consolidated
Balance Sheet is $189,550 as at September 30, 2010 (2009 - $172,962).

---

Derivative Liabilities

Our stock options are denominated in a currency other than our
functional currency and the instruments were required to be accounted for as
separate derivative liabilities. These liabilities were required to be measured
at fair value. These instruments were adjusted to reflect fair value at each
period end. Any increase or decrease in the fair value was recorded in results
of operations as change in fair value of derivative liabilities. In determining
the appropriate fair value, we used the Black-Scholes pricing model.

Recently Issued Accounting Standards

A summary of Recently Issued Accounting Standards is provided
in Item 7 of the Companys latest Form 10-K/A filing with the SEC.

Qualified Person and Caution With Respect to
Forward-looking Statements

Mr. H. Lutz Klingmann, P.Eng., the president of the Company, is
a qualified person for the purposes of National Instrument 43-101 and has
reviewed and approved the technical information in this report.

This report contains certain forward-looking statements, which
relate to the intent, belief and current expectations of the Companys
management. These forward-looking statements are based upon numerous assumptions
that involve risks and uncertainties and other factors that may cause actual
results to differ materially from those indicated by such forward-looking
statements. Such factors include among other things the receipt of required
approvals and permits, the costs of and availability of sufficient capital to
fund the projects to be undertaken by the Company, commodity prices and other
factors. Readers are cautioned not to place undue reliance on the
forward-looking statements, which speak only as of the date the statements were
made.

Caution to U.S. Investors

Management advises U.S. investors that while the terms
measured resources, indicated resources and inferred resources are
recognized and required by Canadian regulations, the U.S. Securities and
Exchange Commission does not recognize these terms. U.S. investors are cautioned
not to assume that any part or all of the material in the mineral resource
categories will be converted into mineral reserves. References to such terms are
contained in the Companys Form 10-K and other publicly available filings. We
further advise U.S. investors that the mineral reserve estimates are not
compliant with the Securities and Exchange Commission Industry Guide 7 as a
final bankable feasibility study has not been completed.

Additional Information

Further information on Golden Queen Mining Co. Ltd. is
available on the SEDAR web site at www.sedar.com and on the Companys web
site at www.goldenqueen.com.

Item 4. Controls and Procedures

Restatement

We have restated our financial statements for the periods ended
September 30, 2010 and 2009 that were previously issued and filed with Canadian
securities regulators. The restatements were to correct bookkeeping error in
general and administrative expense as of September 30, 2010 and an error that
was made in connection with the Companys adoption of a new
accounting pronouncement, ASC 815-40-15 which came into effect on January 1,
2009 and for each of the reporting period thereafter.

---

Disclosure of Controls and Procedures

Disclosure controls and procedures and other procedures that
are designed to ensure that information required to be disclosed in our reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported, within the time period specified in the SEC's rules and forms.
Disclosure controls and procedures include, without limitation, controls and
procedures designed to ensure that information required to be disclosed in our
reports filed under the Exchange Act is accumulated and communicated to
management including our Chief Executive Officer and Chief Financial Officer as
appropriate, to allow timely decisions regarding required disclosure.

Evaluation of disclosure controls and procedures and
remediation

A material weakness is a deficiency, or a combination of
deficiencies, in our disclosure controls and procedures such that there is a
reasonable possibility that a material misstatement of our companys annual or
interim financial statements will not be prevented or detected on a timely
basis.

In connection with the restatements, we identified material
weaknesses in our disclosure controls and procedures and have noted as follows:

| | a. | The Company does not review certain expenditures in a
      U.S. bank account on a regular basis; and                          
| | -- | -------------------------------------------------------------------------------------------------------------------------------
| | b. | The Company does not have the proper procedure for
      recording and reporting changes in the US dollar to Canadian
  dollar.

In connection with this quarterly report, as required by Rule
13a-15 under the Securities Exchange Act of 1934, we have carried out a
re-evaluation of the effectiveness of the design and operation of our company's
disclosure controls and procedures. This re-evaluation was carried out under the
supervision and with the participation of our Company's management, including
our Company's Chief Executive Officer and Chief Financial Officer. Based upon
that evaluation, our Company's Chief Executive Officer and Chief Financial
Officer concluded that as of September 30, 2010, our disclosure controls and
procedures were not effective as at the end of the period covered by this
report.

On December 7, 2010, the Company announced that following an
internal review by our Company and our independent auditors, the Company would
include restated historical financial statements in this quarterly report for
the period ended September 30, 2010. The historical financial statements were
previously issued and filed with Canadian securities regulators. Our conclusion
to restate the above period resulted in the company recognizing that its
disclosure controls and procedures were not effective as of the period ended
September 30, 2010 and constituted material weaknesses.

To address these material weaknesses, we will perform
additional analyses and other procedures to ensure that the financial statements
included herein fairly present, in all material respects, our financial
position, results of operations and cash flows for the periods presented.

To remediate the material weakness in our disclosure controls
and procedures identified above, in addition to working with our independent
auditors, will continue to refine our internal procedures to alleviate this
weakness and will consider adding human resources with experience in generally
accepted accounting principles (GAAP) and are committed to ongoing education in
this area as a well as a defined process to prepare such calculations.

---

Limitations on the effectiveness of disclosure controls
and procedures

A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of
fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments, in decision making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be
circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of internal control is based in part upon certain assumptions above the likelihood of future
events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the
policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

---

PART II  OTHER INFORMATION

Item 6. Exhibits

|31.1 | Certification
        Pursuant to Rule 13a-14(a) or 15d-14(a) of the U.S. Securities Exchange
        Act of 1934
|---- | -----------------------------------------------------------------------------------------------------------------
|     |                                                                                                                  
|32.1 | Section 1350
        Certification of the Principal Executive Officer and Principal Financial
        Officer    

SIGNATURES

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

Date: February 11, 2011

GOLDEN QUEEN MINING CO. LTD.(Registrant)

| | By: | /s/ Lutz Klingmann               
| | --- | ---------------------------------
| |     | Lutz Klingmann                   
| |     | Principal Executive Officer and  
| |     | Principal Financial
      Officer

---