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UNITED STATESSECURITIES
AND EXCHANGE COMMISSIONWashington, D.C. 20549

Form 10-Q /A

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

For the quarterly period ended June 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 Avenue West
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 [  ] No [X]

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 June
30, 2010 the registrants outstanding common stock consisted of94,078,383  shares.

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EXPLANATORY NOTE

This amended quarterly report on Form 10-Q/A for the period ended June 30, 2010 discloses and discusses the impact and effect of restatements of our previously filed financial statements as at June 30, 2010 and the related interim consolidated balance sheets as at June 30, 2010 and the interim consolidated statements of loss and, stockholders’ equity and cash flows for the quarters ended June 30, 2010 and 2009 for the effects of the adoption of accounting pronouncement, the understatement of accrued liabilities, stock-based compensation expense and accounting for share issuance cost.

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, we would restate our historical financial statements.  In addition, due to bookkeeping error, we also identified an error in accounts payable for the three months period ended June 30, 2010.   Accordingly, management concluded, and our audit committee agreed, that our financial statements and all earnings press releases and similar communications issued by us relating to quarters ended June 30, 2010 and June 30, 2009 should no longer be relied upon.

As a result of the review, our Company concluded that the new accounting pronouncement of ASC 815-40-15 was not properly adopted on January 1, 2009, certain payables and expenses were not properly accounted for as of June 30, 2010.  Therefore, we are restating previously issued financial statements to properly record the period end amounts of stock-based compensation expense, general and administrative expenses, change  in fair value of derivative liability, the amounts of net loss for the period and loss per share and the ending deficit for the period ended June 30, 2010 on the unaudited interim consolidated statement of loss, the accounts payable and derivative liability on the unaudited interim consolidated balance sheet, and 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 $1,045,345 (2009 - $534,615) and $800,583 (2009 - $1,023,742) for the three and six months period ended June 30, 2010, an increase in the ending deficit by $2,431,628, a decrease in share capital by $1,748,233, a decrease in additional paid in capital by $742,648 and an increase in total liabilities by $4,684,565.  This 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 regarding the controls and procedures as disclosed in Item 4 of the 10-Q/A.

This amended quarterly report on Form 10-Q/A for the quarter ended June 30, 2010 amends and restates only those items of the previously filed annual report on Form 10-Q for the quarter ended June 30, 2010 which have been affected by the restatement. In order to preserve the nature and character of the disclosures set forth in such items as originally filed, no attempt has been made in this amendment (i) to modify or update such disclosures except as required to reflect the effects of the restatement or (ii) to 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. No other information contained in our previously filed Form 10-Q for the quarter ended June 30, 2010 has been updated or amended.

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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 Statements 
    June 30, 2010 
    (Unaudited - Restated)

(US Dollars)

---

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

|                                                                                                                                                                                                                                                                                                                                                |   | June 30, 2010       |   |   | December 31, 2009   |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------------- | - | - | ------------------- | -
|                                                                                                                                                                                                                                                                                                                                                |   | (Restated  Note 7) |   |   | (Restated  Note 7) |  
|Assets                                                                                                                                                                                                                                                                                                                                          |   |                     |   |   |                     |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Current assets:                                                                                                                                                                                                                                                                                                                                 |   |                     |   |   |                     |  
|Cash and cash equivalents                                                                                                                                                                                                                                                                                                                       | $ | 8,431,472           |   | $ | 2,433,202           |  
|Receivables                                                                                                                                                                                                                                                                                                                                     |   | 30,177              |   |   | 24,604              |  
|Prepaid expenses and other current assets                                                                                                                                                                                                                                                                                                       |   | 4,880               |   |   | 19,490              |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Total
      current assets                                                                                                                                                                                                                                                                                                                      |   | 8,466,529           |   |   | 2,477,296           |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Property
      and equipment, net                                                                                                                                                                                                                                                                                                               |   | 202,946             |   |   | 205,916             |  
|Reclamation financial
      assurance                                                                                                                                                                                                                                                                                                           |   | 286,653             |   |   | 286,653             |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Total Assets                                                                                                                                                                                                                                                                                                                                    | $ | 8,956,128           |   | $ | 2,969,865           |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Liabilities and Shareholders Equity                                                                                                                                                                                                                                                                                                            |   |                     |   |   |                     |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Current liabilities:                                                                                                                                                                                                                                                                                                                            |   |                     |   |   |                     |  
|Accounts payable (Note 7)                                                                                                                                                                                                                                                                                                                       | $ | 262,188             |   | $ | 150,766             |  
|Accrued
      liabilities                                                                                                                                                                                                                                                                                                                       |   | -                   |   |   | 77,821              |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Total current Liabilities                                                                                                                                                                                                                                                                                                                       |   | 262,188             |   |   | 228,587             |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Asset retirement
      obligations                                                                                                                                                                                                                                                                                                              |   | 185,554             |   |   | 177,564             |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Derivative liability
      (Note 7)                                                                                                                                                                                                                                                                                                             |   | 4,684,565           |   |   | 2,695,602           |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Total Liabilities                                                                                                                                                                                                                                                                                                                               |   | 5,132,307           |   |   | 3,101,753           |  
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Shareholders Equity:                                                                                                                                                                                                                                                                                                                           |   |                     |   |   |                     |  
|Preferred
      shares, no par value, 3,000,000 shares authorized; 
                  no
      shares outstanding 
              
      Common shares, no par value, 100,000,000 shares authorized; 
                 
      94,078,383 (December 31, 2009  88,378,383) shares issued and 
                 
      outstanding  Notes 3 and 7 |   | 56,325,830          |   |   | 50,205,634          |  
|Additional paid-in
      capital  Note 7                                                                                                                                                                                                                                                                                                       |   | 3,493,841           |   |   | 3,130,549           |  
|Deficit
      accumulated during the exploration stage                                                                                                                                                                                                                                                                                          |   | (55,995,850         | ) |   | (53,468,071         | )
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Total Shareholders Equity                                                                                                                                                                                                                                                                                                                      |   | 3,823,821           |   |   | (131,888            | )
|                                                                                                                                                                                                                                                                                                                                                |   |                     |   |   |                     |  
|Total Liabilities and
      Shareholders Equity                                                                                                                                                                                                                                                                                                | $ | 8,956,128           |   | $ | 2,969,865           |  

Basis of presentation and ability to continue as a going
  concern (Note 1) 
  Commitments and contingencies (Note 4) 
  Subsequent events (Notes
  3 and 8)

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  |  
|                                                                                  |   |                 |   |   |                 |   |   | Six Months      |   |   | Six Months      |   |   | (November 21,      |  
|                                                                                  |   | Three Months    |   |   | Three Months    |   |   | Ended           |   |   | Ended           |   |   | 1985) through June |  
|                                                                                  |   | Ended June 30,  |   |   | Ended June 30,  |   |   | June 30,        |   |   | June 30,        |   |   | 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  Note 7                                | $ | (1,578,490      | ) | $ | (693,332        | ) | $ | (1,941,309      | ) | $ | (1,190,692      | ) | $ | (21,669,109        | )
|Asset impairment loss                                                             |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | (32,135,592        | )
|Adjustment to asset
      retirement obligation on changes in cash flow estimates |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | 223,583            |  
|Accretion expense                                                                 |   | (3,995          | ) |   | (3,353          | ) |   | (7,990          | ) |   | (6,706          | ) |   | (63,371            | )
|Increase in fair value of
      derivative liability                              |   | (824,224        | ) |   | (534,615        | ) |   | (579,462        | ) |   | (1,023,742      | ) |   | (2,674,762         | )
|Gain on settlement of debt                                                        |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | 136,627            |  
|Abandoned mineral property
      interests                                        |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | (277,251           | )
|                                                                                  |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                    |  
|                                                                                  |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                    |  
|                                                                                  |   | (2,406,709      | ) |   | (1,231,300      | ) |   | (2,528,761      | ) |   | (2,221,140      | ) |   | (56,459,875        | )
|Interest expense                                                                  |   | -               |   |   | -               |   |   | -               |   |   | -               |   |   | (913,098           | )
|Interest income                                                                   |   | 342             |   |   | 471             |   |   | 982             |   |   | 2,907           |   |   | 1,600,969          |  
|                                                                                  |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                    |  
|Net loss and comprehensive loss for the
      period                              | $ | (2,406,367      | ) | $ | (1,230,829      | ) | $ | (2,527,779      | ) | $ | (2,218,233      | ) | $ | (55,772,004        | )
|                                                                                  |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                    |  
|Loss per share, basic and diluted                                                 | $ | (0.03           | ) | $ | (0.01           | ) | $ | (0.03           | ) | $ | (0.03           | ) |   |                    |  
|                                                                                  |   |                 |   |   |                 |   |   |                 |   |   |                 |   |   |                    |  
|Weighted average number of common shares
      outstanding                        |   | 90,671,790      |   |   | 85,640,883      |   |   | 89,796,615      |   |   | 85,640,883      |   |   |                    |  

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 (Capital Deficit)
|(Unaudited)                                                                              

|                                                                         |        |            |  |        |            |  |              |   |  |         |            |  |                   | Deficit     |   |                   | Total         |  
|------------------------------------------------------------------------ | ------ | ---------- |  | ------ | ---------- |  | ------------ | - |  | ------- | ---------- |  | ----------------- | ----------- | - | ----------------- | ------------- | -
|From the Date of Inception (November 21, 1985) through
    June 30, 2010 |        |            |  |        |            |  |              |   |  |         | Additional |  |                   | Accumulated |   |                   | Shareholders |  
|                                                                         | Common |            |  |        |            |  | Stock        |   |  | Paid-in |            |  | During the        |             |   | Equity            |              
|                                                                         | Shares |            |  | Amount |            |  | Subscription |   |  | Capital |            |  | Exploration Stage |             |   | (Capital 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 (Capital Deficit)
|(Unaudited)                                                                              

|                                                                     |        |            |  |        |            |  |              |          |   |                 |          |   |                   | Deficit     |   |                 | Total         |  
|-------------------------------------------------------------------- | ------ | ---------- |  | ------ | ---------- |  | ------------ | -------- | - | --------------- | -------- | - | ----------------- | ----------- | - | --------------- | ------------- | -
|From the Date of Inception (November 21, 1985) through June 30, 2010 |        |            |  |        |            |  |              |          |   |                 |          |   |                   | Accumulated |   |                 | Shareholders |  
|                                                                     | Common |            |  |        |            |  | Stock        |          |   | Additional      |          |   | During the        |             |   | Equity (Capital |              
|                                                                     | Shares |            |  | Amount |            |  | Subscription |          |   | Paid-in Capital |          |   | Exploration 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 (Capital Deficit)
|(Unaudited)                                                                              

|                                                                     |        |            |  |        |            |  |              |   |  |                 |           |  |                   | Deficit     |   |                 | Total         |  
|-------------------------------------------------------------------- | ------ | ---------- |  | ------ | ---------- |  | ------------ | - |  | --------------- | --------- |  | ----------------- | ----------- | - | --------------- | ------------- | -
|From the Date of Inception (November 21, 1985) through June 30, 2010 |        |            |  |        |            |  |              |   |  |                 |           |  |                   | Accumulated |   |                 | Shareholders |  
|                                                                     | Common |            |  |        |            |  | Stock        |   |  | Additional      |           |  | During the        |             |   | Equity (Capital |              
|                                                                     | Shares |            |  | Amount |            |  | Subscription |   |  | Paid-in Capital |           |  | Exploration 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 (Capital Deficit)
|(Unaudited)                                                                              

|                                                                                         |        |            |  |        |            |   |              |   |  |                 |           |   |                   | Deficit     |   |                   | Total         |  
|---------------------------------------------------------------------------------------- | ------ | ---------- |  | ------ | ---------- | - | ------------ | - |  | --------------- | --------- | - | ----------------- | ----------- | - | ----------------- | ------------- | -
|From the Date of Inception (November 21, 1985) through June 30, 2010                     |        |            |  |        |            |   |              |   |  |                 |           |   |                   | Accumulated |   |                   | Shareholders |  
|                                                                                         | Common |            |  |        |            |   | Stock        |   |  | Additional      |           |   | During the        |             |   | Equity            |              
|                                                                                         | Shares |            |  | Amount |            |   | Subscription |   |  | Paid-in Capital |           |   | Exploration Stage |             |   | (Capital 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 (Note 7)                                           |        | -          |  |        | -          |   |              | - |  |                 | -         |   |                   | (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                              |        | 700,000    |  |        | 234,113    |   |              | - |  |                 | -         |   |                   | -           |   |                   | 234,113       |  
|Reclassification of
      derivative liability on the exercise of stock options (Note 7) |        | -          |  |        | -          |   |              | - |  |                 | 363,292   |   |                   | -           |   |                   | 363,292       |  
|Issuance of common shares through private
      placement                                |        | 5,000,000  |  |        | 5,907,798  |   |              | - |  |                 | -         |   |                   | -           |   |                   | 5,907,798     |  
|Share issuance costs (Note 7)                                                            |        | -          |  |        | (21,715    | ) |              | - |  |                 | -         |   |                   | -           |   |                   | (21,715       | )
|Net loss for the period                                                                  |        | -          |  |        | -          |   |              | - |  |                 | -         |   |                   | (2,527,779  | ) |                   | (2,527,779    | )
|                                                                                         |        |            |  |        |            |   |              |   |  |                 |           |   |                   |             |   |                   |               |  
|                                                                                         |        |            |  |        |            |   |              |   |  |                 |           |   |                   |             |   |                   |               |  
|Balance, June 30, 2010                                                                   |        | 94,078,383 |  | $      | 56,325,830 |   | $            | - |  | $               | 3,493,841 |   | $                 | (55,995,850 | ) | $                 | 3,823,821     |  

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 |  
|                                                                                        |   |                |   |   |                |   |   | (November 21,     |  
|                                                                                        |   | Six Months     |   |   | Six Months     |   |   | 1985) through     |  
|                                                                                        |   | Ended June 30, |   |   | Ended June 30, |   |   | June 30,          |  
|                                                                                        |   | 2010           |   |   | 2009           |   |   | 2010              |  
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Operating activities:                                                                   |   |                |   |   |                |   |   |                   |  
|Net loss for the period                                                                 | $ | (2,527,779     | ) | $ | (2,218,233     | ) | $ | (55,772,004       | )
|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                                                           |   | 2,970          |   |   | 3,012          |   |   | 464,771           |  
|Amortization of debt discount                                                           |   | -              |   |   | -              |   |   | 375,000           |  
|Adjustment to asset retirement obligation
      based on changes in cash flow estimates |   | -              |   |   | -              |   |   | (223,583          | )
|Accretion expense                                                                       |   | 7,990          |   |   | 6,706          |   |   | 63,371            |  
|Change in fair value of derivative liability                                            |   | 579,462        |   |   | 1,023,742      |   |   | 2,674,762         |  
|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                                                                             |   | (5,573         | ) |   | (3,894         | ) |   | (30,177           | )
|Prepaid expenses and other
      current assets                                         |   | 14,610         |   |   | 13,570         |   |   | (91,790           | )
|Accounts payable and accrued liabilities                                                |   | 33,601         |   |   | (173,250       | ) |   | 302,105           |  
|Royalty and mining rights
      payable                                                 |   | -              |   |   | (48,034        | ) |   | -                 |  
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Cash used in operating activities                                                       |   | (1,848,444     | ) |   | (1,187,326     | ) |   | (39,924,618       | )
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Investing activities:                                                                   |   |                |   |   |                |   |   |                   |  
|Purchase of mineral properties                                                          |   | -              |   |   | -              |   |   | (7,803,356        | )
|Deposits on mineral properties                                                          |   | -              |   |   | -              |   |   | (1,017,551        | )
|Purchase of reclamation financial assurance                                             |   | -              |   |   | -              |   |   | (286,653          | )
|Purchase of property and
      equipment                                                |   | -              |   |   | -              |   |   | (1,313,838        | )
|Proceeds from sale of property and equipment                                            |   | -              |   |   | -              |   |   | 47,153            |  
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Cash used in investing activities                                                       |   | -              |   |   | -              |   |   | (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      |   |   | -              |   |   | 28,871,618        |  
|Share issuance costs                                                                    |   | (21,715        | ) |   | -              |   |   | (709,816          | )
|Issuance of special warrants                                                            |   | -              |   |   | -              |   |   | 18,091,667        |  
|Issuance of common shares upon
      exercise of stock options                          |   | 234,113        |   |   | -              |   |   | 523,703           |  
|Issuance of common shares upon
      exercise of warrants                               |   | -              |   |   | -              |   |   | 9,700,881         |  
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Cash provided by financing activities                                                   |   | 7,846,714      |   |   | -              |   |   | 58,730,335        |  
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Net change in cash and cash equivalents                                                 |   | 5,998,270      |   |   | (1,187,326     | ) |   | 8,431,472         |  
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Cash and cash equivalents, beginning
      balance                                      |   | 2,433,202      |   |   | 3,033,771      |   |   | -                 |  
|                                                                                        |   |                |   |   |                |   |   |                   |  
|Cash and cash equivalents, ending balance                                               | $ | 8,431,472      |   | $ | 1,846,445      |   | $ | 8,431,472         |  

See Notes to Unaudited Interim Consolidated Financial
  Statements.

8

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 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 item 2.                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | The Company has had no revenues from operations since
      inception, and a deficit of $55,995,850 accumulated during the exploration
      stage. 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 six
      months period ended June 30, 2010 are not necessarily indicative of the
      results expected to be for the year ending December 31, 2010.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|2. | Significant Accounting
      Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

Recent Accounting Pronouncements

| | (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 interim consolidated financial
      statements.                                                                                                         

9

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 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 the
      Companys financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

10

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 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 of 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 fee of $21,715 as a share issuance cost.
  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 value of the warrants was
  determined using the Black-Scholes option pricing model with assumptions as set
  out below.

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.

Stock Options

In April 2010, the Company granted
  50,000 stock options to a consultant, which are exercisable at C$1.24 per share
  and expire on April 18, 2015. The 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                                                      | (700,000) |  | C$0.35           
|                                                               |           |  |                  
|Options outstanding and exercisable, June 30,
        2010     | 3,200,000 |  | C$0.47           

11

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

|3. | Share Capital (continued)
|-- | -------------------------

Stock Options (continued)

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

|          |  |                  |  | Weighted-Average |                 
|--------- |  | ---------------- |  | ---------------- | ----------------
|          |  | Weighted Average |  | Contractual Life |                 
|Number    |  | Exercise Price   |  | (Years)          | Expiry Date     
|          |  |                  |  |                  |                 
|1,200,000 |  | C$0.77           |  | 0.81             | April 20, 2011  
|1,950,000 |  | C$0.26           |  | 3.58             | January 28, 2014
|50,000    |  | C$1.24           |  | 4.80             | April 18, 2015  
|          |  |                  |  |                  |                 
|3,200,000 |  | C$0.47           |  | 2.56             |                 

The Company applies the fair value
  method in accounting for its stock options granted 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 was calculated using the
  following weighted average assumptions:

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

As at June 30, 2010, the aggregate
  intrinsic value of the outstanding exercisable options was approximately
  $3,082,000 (2009 - $932,302). The total intrinsic value of options exercised
  during the 6 months period ended June 30, 2010 was approximately $363,000 (2009
  - $Nil).

Warrants

The following is the summary of the
  outstanding warrants as at June 30, 2010:

|                                                                 |           |  | Weighted-        |  | Average              |                 
|---------------------------------------------------------------- | --------- |  | ---------------- |  | -------------------- | ----------------
|                                                                 |           |  | Average Exercise |  | Contractual          |                 
|                                                                 | Shares    |  | Price Per Share  |  | Life
        (Years) | Expiry Date     
|                                                                 |           |  |                  |  |                      |                 
|Outstanding and exercisable, 
        December 31, 2008 and 2009 | -         |  | -                |  | -                    | -               
|                                                                 |           |  |                  |  |                      |                 
|Granted:                                                         |           |  |                  |  |                      |                 
|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, June 30, 2010                       | 2,500,000 |  | C$1.88           |  | -                    |                 

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

12

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

|3. | Share Capital (continued)
|-- | -------------------------

Warrants (continued)

The fair value of the warrants was
  calculated using the Black-Scholes option pricing model with the following
  weighted average assumptions:

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

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.

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). Each unit consisted of one common share, one-quarter of one Class
  A warrant and one-quarter of one Class B warrant. Each Class A warrant is
  exercisable to acquire one additional common share of the Company at a price of
  $1.75. Each Class B warrant is exercisable to acquire one additional common
  share of the Company at a price of $2.00. Both Class A and Class B warrants
  expire December 1, 2011.

In September 2010, 50,000 stock options
  were exercised and the Company issued 50,000 common shares at C$0.26 per
  share.

13

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 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, of which approximately $86,000 was paid
  during the six months period ended June 30, 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 and June 30, 2010, 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
  the 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 June 30, 2010, the milestones had not been reached and no
  accrual was made in connection with these arrangements.

14

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

|5. | Related Party Transactions
|-- | --------------------------

Except as noted elsewhere in these
  interim consolidated financial statements, related party transactions are
  disclosed as follows:

For the three and six months ended June
  30, 2010, $35,717 and $70,196 (2009 - $28,945 and $56,377) was paid to Mr. H. L.
  Klingmann for services as President of the Company. For the same reporting
  periods, $4,381 and $8,706 (2009 - $4,400 and $8,000) 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.

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

| |                                                                            |   |                     |  |   |                     |  |   | Cumulative         | 
| | -------------------------------------------------------------------------- | - | ------------------- |  | - | ------------------- |  | - | ------------------ | 
| |                                                                            |   |                     |  |   |                     |  |   | Amounts From Date  | 
| |                                                                            |   |                     |  |   |                     |  |   | of Inception       | 
| |                                                                            |   |                     |  |   |                     |  |   | (November 21,      | 
| |                                                                            |   | Period ended        |  |   | Period ended        |  |   | 1985) through June | 
| |                                                                            |   | June
      30, 2010 |  |   | June
      30, 2009 |  |   | 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 | $ | 363,292             |  | $ | -                   |  | $ | 520,126            | 
| | 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                                               | $ | 7,990               |  | $ | 6,706               |  | $ | 185,554            | 

15

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

|7. | Restatements
|-- | ------------

| | a) | Subsequent to the issuance of the Companys December 31,
      2009 consolidated financial statements, and the unaudited interim
      consolidated financial statements for the period ended March 31, 2010,
      management discovered an error in connection with the guidance of ASC
      815-40-15 in respect of the Companys outstanding stock options. As at
      January 1, 2009, the date on which the guidance of ASC 815-40-15 became
      effective for the Company, these stock options 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 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.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | The transition provisions of ASC 815-40-15 require
      cumulative effect adjustments as of January 1, 2009 to reflect the amounts
      that would have been recognized if derivative fair value accounting had
      been applied from the original issuance date of an equity-linked financial
      instrument through the implementation date of the revised guidance. Thus,
      the Company calculated the value of the derivative liability associated
      with the stock options at the date of their issuances and recorded the
      change in the fair value of the derivative liability from the date of the
      grant of the options up to January 1, 2009. Additionally, in conjunction
      with the foregoing, the previously calculated amounts in respect of the
      additional paid-in capital were reversed.                                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | The cumulative effect of this change in accounting
      principle of $399,147 has been recognized as a decrease of the opening
      balance of the accumulated deficit of $464,255 and a decrease in the
      opening balance of additional paid-in capital of $863,402 as of January 1,
      2009, with corresponding adjustments at January 1, 2009 to recognize a
      derivative liability of $399,147.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | Stock-based compensation of $357,989 in respect of stock
      options granted in 2009, previously recorded as additional paid-in
      capital, was reclassified as derivative liability in connection with the
      adoption of these pronouncements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | During the year ended December 31, 2009, a total of
      400,000 stock options included 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 $156,834, subsequent to which it was reclassified to additional
      paid-in capital. 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
       100.45% - 108.23%, expected life  0.28  0.44 years, risk-free discount
      rate  1.23% - 1.52%, dividend yield  0.00%.                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    | As of December 31, 2009, the Company had re-measured the
      remaining outstanding options and determined the fair value of the
      derivative liability to be $2,695,602.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

16

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 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 Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

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

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

| | (i)   | Subsequent to the issuance of the Companys unaudited
      interim consolidated financial statements for the period ended June 30,
      2010, management discovered an error in accounts payable and receivables.
      The Company has consumed and received goods and services for the three
      months period ended June 30, 2010 but did not accrue the amount payable.
      As a result, as of June 30, 2010 receivables were overstated by net amount
      of $3,513, accounts payable and total liabilities were understated by
      $234,431, general and administrative expenses for the three months ended
      on June 30, 2010 was understated by$237,944.                                                                                                                                                                                                                      
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (ii)  | The Company had previously expensed share issuance cost
      of $21,715 as general and administrative expense and has revised the stock
      based compensation expense from $41,383 to $46,275. As a result of these
      errors, general and administrative expense was understated by $16,823,
      derivative liability was understated by $4,892 and share capital was
      overstated by $21,715.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (iii) | During the period ended June 30, 2010, a total of 700,000
      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 $363,292. 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 June 30, 2010 and June 30, 2009, the Company had
      re-measured the remaining outstanding options and determined the fair
      value of the derivative liability to be $3,422,262 and $1,780,878
      respectively using the Black-Scholes option pricing model using the
      following assumptions:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

|                                      | June
        30, 2010 | June
        30, 2009
|------------------------------------- | --------------------- | ---------------------
|                                      |                       |                      
|Risk-free interest rate               | 1.39% -2.32%          | 0.27% to 1.19%       
|Expected life of derivative liability | 0.81 to 4.8 years     | 0.59 to 1.81 years   
|Expected volatility                   | 80% to 113%           | 141% to 144%         
|Dividend rate                         | 0.00%                 | 0.00%                

18

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

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

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

As of June 30, 2010, the Company had re-measured the remaining
  outstanding warrants and determined the fair value of the derivative liability
  to be $1,262,303 (2009 - $Nil) using the Black-Scholes option pricing model
  using the following assumptions:

|                                      | June
        30, 2010
|------------------------------------- | ---------------------
|                                      |                      
|Risk-free interest rate               | 1,45%                
|Expected life of derivative liability | 1.42 years           
|Expected volatility                   | 95%                  
|Dividend rate                         | 0.00%                

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

|As previously              |  
|-------------------------- | -
|                           |  
|Receivables                | $
|Accounts payable           | $
|Derivative liability       | $
|Share capital              | $
|Additional paid in capital | $
|Ending accumulated deficit | $

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 June 30, 2010:                |   |               |   |   |            |   |   |            |  
|Increase in fair value of
        derivative liability   | $ | -             |   | $ | (824,224   | ) | $ | (824,224   | )
|General and administrative expenses                      | $ | (1,357,369    | ) | $ | (221,121   | ) | $ | (1,578,490 | )
|Net loss and comprehensive
        loss for the period   | $ | (1,361,022    | ) | $ | (1,045,345 | ) | $ | (2,406,367 | )
|Loss per share, basic and diluted                        | $ | (0.02         | ) | $ | (0.01      | ) | $ | (0.03      | )
|For the three months period ended June 30,
        2009: |   |               |   |   |            |   |   |            |  
|Increase in fair value of derivative liability           | $ | -             |   | $ | (534,615   | ) | $ | (534,615   | )
|Net loss and comprehensive
        loss for the period   | $ | (696,214      | ) | $ | (534,615   | ) | $ | (1,230,829 | )
|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 Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

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

b) Restatement related to the unaudited
  interim consolidated financial statements for the period ended June 30, 2010
  (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 six months period ended June 30,
        2010:                                      |   |               |   |   |            |   |   |             |  
|Increase in fair
        value of derivative liability                                      | $ | -             |   | $ | (579,462   | ) | $ | (579,462    | )
|General and administrative
        expenses                                                 | $ | (1,720,188    | ) | $ | (221,121   | ) | $ | (1,941,309  | )
|Net loss and
        comprehensive loss for the period                                      | $ | (1,727,196    | ) | $ | (800,583   | ) | $ | (2,527,779  | )
|Cumulative amounts from date of
        inception (November 21, 1985) through June 30, 2010 | $ | (52,876,121   | ) | $ | (2,895,883 | ) | $ | (55,772,004 | )
|Loss per share,
        basic and diluted                                                   | $ | (0.02         | ) | $ | (0.01      | ) | $ | (0.03       | )
|For the six months period ended June 30,
        2009:                                      |   |               |   |   |            |   |   |             |  
|Increase in fair
        value of derivative liability                                      | $ | -             |   | $ | (1,023,742 | ) | $ | (1,023,742  | )
|Net loss and comprehensive loss
        for the period                                      | $ | (1,194,491    | ) | $ | (1,023,742 | ) | $ | (2,218,233  | )
|Loss per share,
        basic and diluted                                                   | $ | (0.01         | ) | $ | (0.02      | ) | $ | (0.03       | )

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 six months period ended June 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                                                                                                             | $ | (1,870,159    | ) | $ | 21,715     |   | $ | (1,848,444    | )
|                                                                                                                                                            |   |               |   |   |            |   |   |               |  
|Cash used in operating
        activities, cumulative 
        amount from date of inception (November 
        21,
        1985) through June 30, 2010     |   | $ (39,946,333 | ) |   | $ 21,715   |   |   | $ (39,924,618 | )
|                                                                                                                                                            |   |               |   |   |            |   |   |               |  
|Cash flows provided by
        financing activities                                                                                                         | $ | 7,868,429     |   | $ | (21,715    | ) | $ | 7,846,714     |  
|                                                                                                                                                            |   |               |   |   |            |   |   |               |  
|Cash provided by financing
        activities, 
        cumulative amount from date of inception 
        (November 21,
        1985) through June 30, 2010 |   | $ 58,752,050  |   |   | $ 21,715   |   |   | $ 58,730,335  |  

20

---

|GOLDEN QUEEN MINING CO. LTD.                      
|--------------------------------------------------
|(an exploration stage company)                    
|Notes to Interim Consolidated Financial Statements
|For the Six Months Ended June 30, 2010            
|(Unaudited)                                       

|8. | Subsequent Event                                                                                                                                              
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                               
|   | In September 2010, the shareholders of the Company
      approved a resolution to increase the authorized common shares from
      100,000,000 to 150,000,000.

21

---

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 August 12,
2010 and should be read in conjunction with the consolidated financial
statements of the Company for the quarter ended June 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.

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 months
ended June 30, 2010 and June 30, 2009.

The Company had no revenue from operations.

The Company incurred general and administrative expenses of
  $1,578,490   (2009 - $693,332).

The following significant costs were incurred during the
quarter and six month period ended June 30, 2010, respectively:

- $86,228 and $105,978 for payment of advance minimum royalties owing to landholders.  Advance minimum royalties are a recurring cost;
- $243,964 and $243,964 for property purchases that completed in the second quarter.  The company is reviewing additional property purchases;
- $56,633 and $115,407 for detailed engineering for the heap leach pad and related site drainage for the Project and support for the approvals and permitting process.  Additional fees are expected to be incurred in subsequent quarters to complete this work;
- $220,898 and $381,777 for legal fees incurred for ongoing work on the SEIR.
  Additional legal fees may be incurred in subsequent quarters, however is expected to be less;
- $68,763 and $89,527 for ongoing work by the Kern County Planning Department and Kern County Engineering & Survey Services on the SEIR;
- C$61,020 and C$82,723 for an evaluation of the power supply and the design of a sub-station for the Project.  Additional fees may be incurred in subsequent quarters to complete the evaluation;

Interest income of $342 (2009 - $471) was lower by $129 as
there was less cash on deposit and interest rates remained low during the
quarter. There was no interest expense during the quarter.

The Company incurred a net loss of $2,406,367 (or $0.03 per share) during the quarter and $2,732,672 during the six month period ended June 30, 2010, as compared to a net loss of $1,230,829 (or $0.01 per share) during the second quarter of 2009 and $2,218,233 during the six month period ended June 30, 2009.   The increase in net loss was primarily due to an increase in engineering, county and legal costs in connection with the ongoing preparation and review of the SEIR and the SEIR approval process, as well as property purchases.

---

Summary of Quarterly Results

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

|Results for the quarter ending on:                                             | June 30, 2010                         | March 31, 2010                      | Dec. 31, 2009                          | Sept. 30, 2009                     
|------------------------------------------------------------------------------ | ------------------------------------- | ----------------------------------- | -------------------------------------- | -----------------------------------
|Item                                                                           | $                                     | $                                   | $                                      | $                                  
|Revenue 
        Net  loss for the
        quarter 
        Net loss per share | Nil 
          2,406,367
        0.03 | Nil 
          326,305
        0.00 | Nil 
          1,239,149 
        0.02 | Nil 
          987,404
        0.01

|Results for the quarter ending on:                                            | June 30, 2009                        | March 31, 2009                    | Dec. 31, 2008                        | Sept. 30, 2008                    
|----------------------------------------------------------------------------- | ------------------------------------ | --------------------------------- | ------------------------------------ | ----------------------------------
|Item                                                                          | $                                    | $                                 | $                                    | $                                 
|Revenue 
        Net loss for the quarter 
        Net
        loss per share | Nil 
        1,230,829 
        0.01 | Nil 
        987,404
        0.01 | Nil 
        1,223,439 
        0.01 | Nil 
        923,380 
        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
$185,554 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 $86,228 were paid to landholders
in the second 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.                                                                                                                                                                                                                                                                                                                                                                                     
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| | (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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
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| | (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.
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| | (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.

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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

Mr. H. Lutz Klingmann was paid $35,717 and $70,196 (2009 - $28,945 and $56,377) for services as President and Mr. Chester Shynkaryk was paid $4,381 and $8,706 (2009 - $4,400 and $8,000) for consulting services to the Company during the quarter and the six months ended June 30, 2010.

There were no other related party transactions during the
quarter ended June 30, 2010.

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 one dollar 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. As at June 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 acquired 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) and incurred $21,715 as a share issuance cost.  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.

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Liquidity and Capital Resources

The Company held $8,431,472 in cash and cash equivalents on
June 30, 2010.

Cash used in Operating Activities

During the period ended June 30, 2010, we have incurred significant expenditures in consulting fees in connection with the process of apply permits, ongoing work by the Kern County Planning Department and Kern County Engineering & Survey Services, sampling and assays, and fees paid to landowners.

Cash from Financing Activities 
  During the six months ended June 30, 2010, the cash from financing activities has increased by net proceeds of $7,846,714 (2009 - $Nil).  The Company issued 5,000,000 units of private placements for gross proceeds of $7,643,316 (C$8,000,000) and issued 700,000 common shares for proceeds of $234,113  from the exercise of stock options.

Cash used in Investing Activities 
The Company did not incur expenditures in the investing activities during the three and six-months ended June 30, 2010 and 2009.

The Company has no long-term debt.

Management plans to control costs and does not expect that
additional cash will be required beyond cash currently on hand for ongoing work
on approvals and 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 2010.

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     |  |  |                      |  |  |                      | 
|Shares issued and outstanding on March 31, 2010         |  | 89,078,383  |  |  |                      |  |  |                      | 
|Gammon Gold Inc. private placement                      |  | 5,000,000   |  |  |                      |  |  |                      | 
|Shares issued and outstanding on June 30, 2010          |  | 94,078,383  |  |  | 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             | 
|                                                        |  |             |  |  | C$0.26 &             |  |  | 28/01/14 &           | 
|Director and employee stock options                     |  | 2,000,000   |  |  | C1.24                |  |  | 18/04/15             | 
|Bonus Shares that may be issued to the President        |  | 600,000*    |  |  | Not Applicable       |  |  | Not Applicable       | 
|Shares to be issued as a finders fee                    |  | 100,000     |  |  | Not
      Applicable |  |  | Not
      Applicable | 
|Fully diluted on June 30, 2009                          |  | 100,478,383 |  |  |                      |  |  |                      | 

The company's authorized share capital is 100,000,000 common
shares with no par value. *

*The issuance of the bonus shares is subject to an increase in the authorize capital.

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 tones (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 approvals and permits have been
secured.

If approvals and 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 August 12, 2010 were $1,213.00/oz and $18.03/oz respectively.

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

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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. Readers should evaluate the Companys
prospects in light of these and other risk factors.

Special Meeting of Shareholders

The Company has issued a notice of a special meeting of
shareholders to be held on September 1, 2010 for the purpose of seeking the
approval of shareholders to the following special resolutions, (a) the removal
of the Pre-existing Company Provisions (as defined in the Business
Corporations Act(British Columbia)); (b) the adoption of new Articles of
the Company; and (c) the change in the authorized capital of the Company from
100,000,000 to 150,000,000 common shares, all without par value.

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.

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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 $185,554 as at June 30, 2010 (2009 - $177,564).

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.

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

In addition to items noted above, our company has effected restatements of its financial results for the periods ended June 30, 2010 and 2009.  The restatements were to correct a bookkeeping error in accounts payable as of June 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.   These adjustments result in an increase in net loss and comprehensive loss by $1,045,345 (2009 - $534,615) and $800,583 (2009 - $1,023,742) for the three and six months period ended June 30, 2010, an increase in the ending deficit by $2,431,628 and a decrease in additional paid in capital by $742,648 and an increase in total liabilities by $4,684,565.  This 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.

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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 June 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 filed a Form 8-K disclosing that following an internal review by our Company and our independent auditors, the Company would restate its historical financial statements in our quarterly report for the period ended June 30, 2010.  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 June 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.

Changes in Internal Control over Financial Reporting

There were no changes in our internal controls over financial reporting that occurred during the quarter ended June 30, 2010 that would have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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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: January 26, 2011.

| | GOLDEN QUEEN MINING CO. LTD.
| | ----------------------------
| | (Registrant)                
| |                             
| |                             
| | By:                         
| |                             
| |                             
| |                             

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