SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10–Q/A

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2006

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

GOLDEN STAR RESOURCES LTD.

(Exact Name of Registrant as Specified in Its Charter)

Canada (State or other Jurisdiction of Incorporation or Organization)		98–0101955 (I.R.S. Employer Identification No.)
10901 West Toller Drive, Suite 300 Littleton, Colorado (Address of Principal Executive Office)		80127-6312 (Zip Code)

Registrant’s telephone number, including area code (303) 830–9000

Securities registered or to be registered pursuant to Section 12 (b) of the Act:

Title of Each Class Common Shares		Name of each exchange on which registered American Stock Exchange

Securities registered or to be registered pursuant to Section 12(g) of the Act:
Warrants Issued February 2003

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Act”) 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 þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non–accelerated filer. (See definition of “accelerated filer” and “large accelerated filer” in Rule 12b–2 of the Exchange Act).

(Check one): Large accelerated filer: o       Accelerated filer: þ       Non–accelerated filer: o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b–2 of the Act). Yes o No þ

Number of Common Shares outstanding as at August 8, 2006: 207,845,758

 

 

Explanatory Note

     This Form 10-Q/A is being filed to amend Golden Star Resources Ltd.’s Quarterly Report on Form 10-Q, for the quarter ended June 30, 2006 in order to reflect the restatement of our financial statements for the quarter ended June 30, 2006 to change, in the US GAAP Reconciliation note, the way in which we have accounted for our warrants to purchase common shares which have an exercise price denominated in Canadian dollars. The restatement arose from management’s determination on February 22, 2007 that such warrants denominated in Canadian dollars, which had been treated as equity instruments, should have been treated as derivative instruments under US GAAP. As such the fair value of such warrants is required to be treated as a liability, and we are required to mark to market those warrants on a current basis, with the resulting gains or losses being included in the statement of operations under US GAAP.

     Generally, no attempt has been made in this Form 10-Q/A to modify or update other disclosures presented in the original report on Form 10-Q except as otherwise required to reflect the effects of the restatement, including in footnote 25 and Item 4. This Form 10-Q/A does not reflect events occurring after the filing of the original Form 10-Q or modify or update those disclosures. Information not affected by the restatement is unchanged and reflects the disclosure made at the time of the original filing of the Form 10-Q with the Securities and Exchange Commission on August 8, 2006.

PART I

ITEM 1. FINANCIAL STATEMENTS

GOLDEN STAR RESOURCES LTD.
CONSOLIDATED BALANCE SHEETS
(Stated in thousands of US dollars except shares issued and outstanding)
(Unaudited)

		As of				As of
		June 30,				December 31,
		2006				2005
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	20,882			$	89,709
Short term investments (Note 2)			21,080				—
Accounts receivable			7,339				6,560
Inventories (Note 3)			35,801				23,181
Future tax assets			—				6,248
Fair value of derivatives (Note 13)			12				1,220
Deferred stripping (Note 11)			516				1,548
Deposits (Note 4)			9,637				5,185
Prepaids and other			492				686
Total Current Assets			95,759				134,337
RESTRICTED CASH			5,093				5,442
LONG TERM INVESTMENTS (Note 5)			1,156				8,160
DEFERRED EXPLORATION AND DEVELOPMENT COSTS (Note 7)			166,021				167,532
PROPERTY, PLANT AND EQUIPMENT (Note 8)			85,538				84,527
MINING PROPERTIES (Note 9)			128,024				118,088
CONSTRUCTION IN PROGRESS (Note 10)			115,257				36,707
FUTURE TAX ASSETS			4,456				8,223
OTHER ASSETS			1,358				1,587
Total Assets		$	602,662			$	564,603
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities		$	41,560			$	26,144
Fair value of derivatives (Note 13)			2,928				4,709
Asset retirement obligations (Note 14)			2,735				3,107
Future tax liability			74				—
Current debt (Note 12)			4,666				6,855
Total Current Liabilities			51,963				40,815
LONG TERM DEBT (Note 12)			62,270				64,298
ASSET RETIREMENT OBLIGATIONS (Note 14)			9,618				8,286
FAIR VALUE OF DERIVATIVES (Note 13)			—				7,263
FUTURE TAX LIABILITY			42,263				45,072
Total liabilities			166,114				165,734
MINORITY INTERESTS			6,673				6,629
COMMITMENTS AND CONTINGENCIES (Note 15)			—				—
SHAREHOLDERS’ EQUITY
SHARE CAPITAL (Note 16)
First preferred shares, without par value, unlimited shares authorized. No shares issued			—				—
Common shares, without par value, unlimited shares authorized. Shares issued and outstanding: 207,773,758 at June 30, 2006; 205,954,582 at December 31, 2005			524,367				522,510
CONTRIBUTED SURPLUS			9,309				6,978
EQUITY COMPONENT OF CONVERTIBLE NOTES			2,857				2,857
DEFICIT			(106,658	)			(140,105	)
Total Shareholders’ Equity			429,875				392,240
Total Liabilities and Shareholders’ Equity		$	602,662			$	564,603

The accompanying notes are an integral part of the consolidated financial statements

GOLDEN STAR RESOURCES LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Stated in thousands of US dollars except per share amounts)
(Unaudited)

		Three months ended								Six months ended
		June 30,				June 30,				June 30,				June 30,
		2006				2005				2006				2005
REVENUE
Gold sales		$	28,675			$	23,403			$	53,611			$	40,094
Royalty income			2,003				1,069				3,840				2,119
Interest and other			842				451				1,461				761
Total revenues			31,520				24,923				58,912				42,974
PRODUCTION EXPENSES
Mining operations			21,088				19,890				44,551				31,966
Depreciation, depletion and amortization			5,248				3,741				10,825				5,913
Accretion of asset retirement obligation (Note 14)			186				181				354				368
Total mine operating costs			26,522				23,812				55,730				38,247
OPERATING EXPENSES
Exploration expense			378				247				590				414
General and administrative expense			2,377				2,086				5,132				4,948
Corporate development expense			—				14				—				110
Total production and operating expenses			29,277				26,159				61,452				43,719
Operating income/(loss)			2,243				(1,236	)			(2,540	)			(745	)
OTHER EXPENSES, (GAINS) AND LOSSES
Derivative mark-to-market loss (Note 13)			2,058				647				10,728				1,927
Abandonment and impairment of mineral properties			—				—				—				1,083
Gain on sale of portion of investment in EURO (Note 6)			(20,940	)			—				(20,940	)			—
Gain on sale of investment in Moto (Note 5)			—				—				(30,294	)			—
Loss on equity investments			—				70				—				110
Interest expense			490				773				961				852
Foreign exchange (gain)/loss			(2,336	)			736				(3,457	)			842
Income/(loss) before minority interest			22,971				(3,462	)			40,462				(5,559	)
Minority interest			(253	)			(200	)			(44	)			(380	)
Net income/(loss) before income tax			22,718				(3,662	)			40,418				(5,939	)
Provision for future income taxes (Note 19)			(8,294	)			(33	)			(6,971	)			21
Net income/(loss)		$	14,424			$	(3,695	)		$	33,447			$	(5,918	)
Deficit, beginning of period			(121,082	)			(128,797	)			(140,105	)			(126,574	)
Deficit, end of period		$	(106,658	)		$	(132,492	)		$	(106,658	)		$	(132,492	)
Net income/(loss) per common share - basic (Note 20)		$	0.070			$	(0.026	)		$	0.161			$	(0.042	)
Net income/(loss) per common share - diluted (Note 20)		$	0.069			$	(0.026	)		$	0.160			$	(0.042	)
Weighted average shares outstanding (millions of shares)			207.1				142.4				207.2				142.4

The accompanying notes are an integral part of the consolidated financial statements

GOLDEN STAR RESOURCES LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Stated in thousands of US dollars)
(Unaudited)

		Three months ended								Six months ended
		June 30,				June 30,				June 30,				June 30,
		2006				2005				2006				2005
OPERATING ACTIVITIES:
Net income/(loss)		$	14,424			$	(3,695	)		$	33,447			$	(5,918	)
Reconciliation of net income/(loss) to net cash provided by operating activities:
Depreciation, depletion and amortization			5,243				3,741				10,836				5,913
Amortization of loan acquisition cost			79				75				144				75
Deferred stripping			516				33				1,032				117
Loss on equity investment			—				70				—				110
Gain on sale of investment in Moto and EURO			(20,940	)			—				(51,234	)			—
Non-cash employee compensation			164				234				1,061				802
Abandonment and impairment of mineral properties			—				—				—				1,083
Provision for future income taxes			8,294				34				7,280				(20	)
Reclamation expenditures			(338	)			(63	)			(523	)			(292	)
Fair value of derivatives			(1,832	)			647				5,871				1,927
Accretion of convertible debt			184				—				352				—
Accretion of asset retirement obligations			177				181				354				368
Minority interests			253				200				44				380
			6,224				1,457				8,664				4,545
Changes in assets and liabilities:
Accounts receivable			(1,279	)			(2,131	)			(2,610	)			(2,888	)
Inventories			(9,463	)			(7,410	)			(12,620	)			(5,659	)
Deposits			(1,571	)			(425	)			(2,670	)			(957	)
Accounts payable and accrued liabilities			4,221				1,770				1,801				1,769
Other			319				7				194				92
Net cash used in operating activities			(1,549	)			(6,732	)			(7,241	)			(3,098	)
INVESTING ACTIVITIES:
Expenditures on deferred exploration and development			(2,660	)			(1,375	)			(4,797	)			(2,063	)
Expenditures on mining properties			(4,758	)			(8,158	)			(7,762	)			(14,520	)
Expenditures on property, plant and equipment			(634	)			(15,061	)			(6,250	)			(19,093	)
Expenditures on mine construction in progress			(44,783	)			4,568				(69,402	)			(6,039	)
Asset retirement obligation assets			—				757				—				1,057
Investment in short term investments			(21,080	)			(20,050	)			(21,080	)			(3,650	)
Decrease in restricted cash			165				—				349				—
Expenditure on purchase of Moto shares			—				—				(1,656	)			—
Proceeds from sale of investment in Moto			—				—				38,952				—
Proceeds from sale of EURO shares			3,239				—				3,239				—
Change in payable on capital expenditures			(1,362	)			—				4,075				—
Sale of property			—				—				—				1,000
Deposits			7,424				75				(1,782	)			(2,254	)
Other			(416	)			(2,583	)			(364	)			(2,506	)
Net cash used in investing activities			(63,597	)			(41,827	)			(66,478	)			(48,068	)
FINANCING ACTIVITIES:
Issuance of share capital, net of issue costs			1,123				125				3,276				300
Debt repayments			(1,968	)			(408	)			(3,689	)			(885	)
Issuance of debt			—				48,345				5,453				55,504
Other			—				1,864				(150	)			1,756
Net cash provided/(used) by financing activities			(845	)			49,926				4,892				56,675
Increase/(decrease) in cash and cash equivalents			(65,991	)			1,367				(68,827	)			5,509
Cash and cash equivalents, beginning of period			86,873				17,019				89,709				12,877
Cash and cash equivalents end of period		$	20,882			$	18,386			$	20,882			$	18,386

(See Note 21 for supplemental cash flow information)

The accompanying notes are an integral part of the consolidated financial statements

GOLDEN STAR RESOURCES LTD.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(All amounts in tables are in thousands of US dollars unless noted otherwise)
(Unaudited)

These consolidated financial statements and the accompanying notes are unaudited and should be read in conjunction with the audited consolidated financial statements and related notes thereto included in our annual report on Form 10–K for the year ended December 31, 2005, on file with Securities and Exchange Commission and with the Canadian securities commissions. Financial information is presented in accordance with accounting principles generally accepted in Canada.

In early 2006, it was determined that hedge accounting had been improperly applied by our subsidiary, EURO Ressources S.A. (“EURO”) for their cash–settled forward gold price agreements during the first three quarters of 2005. As a result, our Form 10–Qs for the first three quarters of 2005 were amended to apply derivative accounting rather than hedge accounting to EURO’s derivatives. In this Form 10–Q, comparative amounts from the second quarter and for the first six months of 2005 reflect this restatement.

In management’s opinion, the unaudited consolidated financial statements for the three and six months ended June 30, 2006 and June 30, 2005 contained herein reflect all adjustments, consisting solely of normal recurring items, which are necessary for the fair presentation of financial position, results of operations and cash flows on a basis consistent with that of our prior audited consolidated financial statements.

In certain cases prior period amounts have been revised to reflect current period presentation.

1. Description of Business

Through our subsidiaries we own a controlling interest in four significant gold properties in southern Ghana in West Africa: the Bogoso/Prestea property, which is comprised of the adjoining Bogoso and Prestea surface mining leases (“Bogoso/Prestea”), the Prestea Underground property (“Prestea Underground”), the Wassa property (“Wassa”), and the Hwini–Butre and Benso concessions (“St. Jude Properties”). In addition to these gold properties we hold various other exploration rights and interests and are actively exploring in a variety of locations in West Africa and South America.

Bogoso/Prestea is owned by our 90% owned subsidiary Bogoso Gold Limited (“BGL”) which was acquired in 1999. Bogoso/Prestea produced and sold approximately 132,000 ounces of gold during 2005.

Through another 90% owned subsidiary, Wexford Goldfields Limited (“WGL”), we own the Wassa gold mine located some 35 kilometers east of Bogoso/Prestea. Construction and commissioning of Wassa’s new processing plant and open pit mine was completed at the end of March 2005 and the project was placed in service on April 1, 2005. Wassa produced and sold approximately 69,000 ounces of gold in 2005 following its April 2005 in service date.

The Prestea Underground is located on the Prestea property and consists of a currently inactive underground gold mine and associated support facilities. BGL owns a 90% operating interest in the Prestea Underground. We are currently conducting exploration and engineering studies to determine if the underground mine can be reactivated on a profitable basis.

Through our 100% owned subsidiary, St. Jude Resources Ltd. (“St. Jude”), we own the St. Jude Properties in southwest Ghana. The St. Jude Properties consist of the Hwini–Butre and Benso concessions which together cover an area of 201 square kilometers. Both concessions contain undeveloped zones of gold mineralization. The Hwini–Butre and Benso concessions are located

approximately 80 and 40 kilometers south of Wassa, respectively. The mineralized zones have been delineated through the efforts of St. Jude that conducted extensive exploration work from the mid–1990s to 2005.

We hold interests in several gold exploration projects in Ghana and elsewhere in West Africa including Sierra Leone, Burkina Faso, Niger and Cote d’Ivoire. We also hold and manage exploration properties in Suriname and French Guiana in South America. We hold indirect interests in gold exploration properties in Peru and Chile through a 16% shareholding investment in Goldmin Consolidated Holdings. We also own a 43% interest in EURO Ressources S.A. (“EURO”), a French publicly–traded royalty holding company which owns a royalty interest based on gold production at Cambior Inc.’s Rosebel gold mine in Suriname.

Our corporate headquarters are located in Littleton, Colorado, USA. Our accounting records are kept in compliance with Canadian GAAP. All of our operations, except for certain exploration projects keep financial records in US dollars.

2. Short term investments

Short term investments are comprised of funds invested in AAA rated auction rate certificates. The certificates are short term positions in long term securities. The interest rate received is reset every 7, 28 or 35 days, and the certificates can be liquidated for cash at each interest rate reset date.

3. Inventories

		As of June 30,				As of December 31,
		2006				2005
Stockpiled ore		$	9,849			$	5,753
In–process			4,526				3,106
Materials and supplies			21,426				14,322
Total		$	35,801			$	23,181

4. Deposits

Represents cash advances and payments for equipment and materials purchases at WGL and BGL which are not yet on-site.

5. Long Term Investments

We hold a 16% interest in Goldmin Consolidated Holdings, a privately held gold exploration company which operates in South America. In the year ended December 31, 2005 we accounted for our investment as an equity investment but by March 31, 2006 our investment was diluted to less than 20%, and we now account for the investment on the cost basis at $1.2 million.

As of December 31, 2005 we held approximately 11% of the outstanding common shares of Moto Goldmines Limited (“Moto”), a gold exploration and development company publicly traded in Canada, with a focus on gold exploration and development in the Democratic Republic of Congo. In March 2006 we exercised our remaining one million warrants increasing our total ownership to six million common shares, and immediately afterward sold all six million common shares in a bought–deal transaction in Canada for Cdn$7.50 per share. The sale of the six million shares resulted in net proceeds to Golden Star of $39.0 million (Cdn$45.0 million) yielding a pre–tax capital gain of $30.3 million.

6. Investment in EURO

EURO’s most significant asset is its royalty from the Rosebel mine in Suriname, owned and operated by Cambior Inc. Additionally, EURO holds certain gold exploration and development mineral rights in French Guiana, which are the subject of joint venture arrangements. At March 31, 2006 we owned 53% of EURO’s outstanding common shares and as such consolidated EURO’s financial results with our own.

During the second quarter of 2006 we sold 362,029 of our EURO shares in open market transactions realizing approximately $0.7 million of cash. On June 19, 2006 we sold an additional four million EURO shares in a private transaction receiving $2.5 million of cash. The purchasers of the four million shares have agreed to pay additional consideration to Golden Star if they sell the shares at a gain.

The combined share sales during the second quarter diluted our holding in EURO‘s common shares to approximately 43%. In response to a reduced ownership position, the equity method of accounting was adopted on June 20 for our remaining interest in EURO. Under the equity accounting method, our consolidated financial statements no longer include EURO’s assets and liabilities which at March 31, 2006 included $3.2 million of net current assets, $5.6 million of tax assets, $7.0 million of bank loans and $14.9 million of derivative liabilities. The net effect of the change in accounting method resulted in recognition of $17.7 million of non-cash gains. The total gain from the change in our EURO ownership position, includes $3.2 million cash received from sale of shares and $17.7 million from the change in accounting method, is $20.9 million.

Under the equity method accounting rules, Golden Star will recognize a share of EURO’s future earnings/losses in proportion to Golden Star’s ownership position at the end of each period (currently 43%). Golden Star has a zero carrying value for its investment in EURO, and future gains and losses will not be recognized until such time as EURO’s future income offsets accumulated deficits. The value of our remaining 21.4 million EURO common shares was $31.4 million based on EURO’s closing share price June 30, 2006.

7. Deferred Exploration and Development Costs

Consolidated property expenditures on our exploration projects for the six months ended June 30, 2006 were as follows:

		Deferred																Deferred
		Exploration &																Exploration &
		Development				Capitalized								Transfer to				Development
		Costs as of				Exploration				Acquisition				mining				Costs as of
		12/31/05				Expenditures				Costs				properties				6/30/06
AFRICAN PROJECTS
Akropong trend and other Ghana		$	4,947			$	91			$	—			$	(4,209	)		$	829
Prestea property – Ghana			2,074				25				—				(2,099	)			—
Hwini–Butre and Benso – Ghana			135,832				2,262				1,897				—				139,991
Mano River – Sierra Leone			1,285				477				—				—				1,762
Afema – Ivory Coast			1,028				314				—				—				1,342
Goulagou – Burkina Faso			18,247				96				254				—				18,597
Other Africa			1,750				232				(1,090	)			—				892
SOUTH AMERICAN PROJECTS
Saramacca – Suriname			731				43				—				—				774
Bon Espoir – French Guiana			1,382				196				—				—				1,578
Other South America			256				—				—				—				256
Total		$	167,532			$	3,736			$	1,061			$	(6,308	)		$	166,021

8. Property, Plant and Equipment

		As of June 30, 2006												As of December 31, 2005
										Property,												Property,
		Property,								Plant and				Property,								Plant and
		Plant and								Equipment				Plant and								Equipment,
		Equipment				Accumulated				Net Book				Equipment				Accumulated				Net Book
		at Cost				Depreciation				Value				at Cost				Depreciation				Value
Bogoso/Prestea		$	45,604			$	10,453			$	35,151			$	40,802			$	8,240			$	32,562
Prestea Underground			2,919				—				2,919				2,748				—				2,748
Wassa			51,866				4,866				47,000				50,701				1,985				48,716
EURO Ressources			—				—				—				1,456				1,449				7
Corporate & Other			615				147				468				611				117				494
Total		$	101,004			$	15,466			$	85,538			$	96,318			$	11,791			$	84,527

9. Mining Properties

		As of June 30, 2006												As of December 31, 2005
										Mining												Mining
		Mining								Properties,				Mining								Properties,
		Properties at				Accumulated				Net Book				Properties at				Accumulated				Net Book
		Cost				Amortization				Value				Cost				Amortization				Value
Bogoso/Prestea		$	48,100			$	31,384			$	16,716			$	46,970			$	28,792			$	18,178
Prestea Underground			25,818				—				25,818				21,612				—				21,612
Bogoso Sulfide			13,065				—				13,065				13,065				—				13,065
Mampon			15,583				—				15,583				15,062				—				15,062
Wassa			54,421				7,998				46,423				50,810				5,104				45,706
Other			10,419				—				10,419				4,465				—				4,465
Total		$	167,406			$	39,382			$	128,024			$	151,984			$	33,896			$	118,088

10. Mine Construction–in–Progress

At June 30, 2006 and at December 31, 2005, mine construction–in–progress represents costs incurred for the Bogoso Sulfide Expansion Project since the beginning of 2005. Included in the total are costs of development drilling, plant equipment purchases, materials and construction costs, payments to the construction contractors, mining equipment costs, capitalized interest and pre-production stripping costs.

11. Deferred Stripping

The amount of stripping costs to be capitalized in each period is calculated by determining the tonnes of waste moved in excess of the life–of–pit average strip ratio and valuing the excess tonnage of removed waste at the average mining cost per tonne during the period. Costs are recovered in periods when the actual tonnes of waste moved are less than the average life–of–pit rate, such tonnes being valued at the rolling average cost of the waste tonnage amounts capitalized.

The capitalized component of waste rock removal costs is shown on our consolidated balance sheets in the line item titled “Deferred Stripping.” The cost impact is included in the Statements of Operations in the line item titled “Mining operations.”

During the quarter ended June 30, 2006, $0.5 million of deferred stripping costs were recovered and we expect that all remaining deferred stripping cost will be recovered by the end of the third quarter of 2006.

12. Debt

		As of				As of
		June 30, 2006				December 31, 2005
Current debt:
Bank loan – EURO Ressources (Note a)		$	—			$	2,667
Equipment financing loans (Note b)			4,666				4,188
Total current debt		$	4,666			$	6,855
Long term debt:
Bank loan – EURO Ressources (Note a)		$	—			$	5,000
Equipment financing loans (Note b)			14,252				11,632
Convertible notes (Note c)			48,018				47,666
Total long term debt		$	62,270			$	64,298

(a)		Bank debt – As a result of the sale of the EURO shares in June 2006 (see Note 6) Golden Star no longer consolidates the financial statements of EURO as of June 30, 2006. Therefore the EURO bank loan is not included within consolidated debt as of June 30, 2006.
(b)		Equipment financing credit facility – We have established an equipment financing facility between Caterpillar Financial Services Corporation, BGL and WGL, with Golden Star as the guarantor of all amounts borrowed. The facility provides credit for a mixture of new and used mining equipment. This facility is reviewed annually. Amounts drawn under this facility are repayable over five years for new equipment and over two years for used equipment. The interest rate for each draw–down is fixed at the date of the draw–down using the Federal Reserve Bank 2–year or 5–year swap rate or LIBOR plus 2.38%. As of June 30, 2006, $18.9 million was outstanding under this facility. The average interest rate on the outstanding loans is approximately 6.7%. We estimate the fair value of the equipment financing facility to be approximately $16.2 million at June 30, 2006.
(c)		Convertible notes – We sold $50 million of senior unsecured convertible notes to a private investment fund on April 15, 2005. These notes, maturing on April 15, 2009, were issued at par and bear interest at 6.85% with a conversion price of $4.50 per common share. At the maturity date, we have the option, to repay the outstanding notes with i.) cash, ii.) by issuing common shares to the note holders or iii.) a combination of cash and common shares. For any notes repaid in common shares the number of shares will be determined by dividing the loan balance by an amount equal to 95% of the average price of the 20 trading day period ended five days before the notes are due. Due to the beneficial conversion feature, approximately $47.1 million of the note balance was initially classified as a liability and $2.9 million was classified as equity. Periodic accretion will increase the liability to the full $50 million amount due (after adjustments, if any, for converted notes) by the end of the note term. The periodic accretion is included in interest expense. A total of $4.0 million of interest on the convertible notes was capitalized as Bogoso sulfide expansion project costs. We estimate the fair value of the convertible notes to be essentially equal to their carrying value at June 30, 2006.

13. Derivatives

EURO – In January 2005, EURO, then a majority owned subsidiary, entered into a series of derivative contracts in conjunction with a $6.0 million loan agreement. EURO’s derivatives are tied to a future stream of gold royalty payments EURO expects to receive from Cambior Inc., which purchased a mining property interest from Golden Star in 2002. Golden Star originally owned the royalty but sold the

royalty to EURO in 2004. In September 2005, EURO entered into a second set of derivative contracts related to a further $3.0 million debt facility.

During 2005, we recorded a realized derivative loss of $0.5 million for cash settlement of the first four quarterly tranches and we recorded $9.6 million of unrealized, non–cash mark–to–market losses as of December 31, 2005. At June 30, 2006 we recorded $0.8 million payments to EURO’s counterparties for expiring positions and an additional $4.1 million mark–to–market loss for the period ended June 19, 2006.

As a result of the sale of the EURO shares in June 2006, (see Note 6) Golden Star is not required to consolidate the financial statements of EURO as of June 30, 2006. Therefore the EURO derivative contract liability is no longer included in our consolidated derivatives as of June 30, 2006.

Gold Derivatives – To provide gold price protection during the 2005/2006 construction phase of the Bogoso Sulfide Expansion Project, we purchased a series of gold puts. The first purchase occurred in the second quarter of 2005 when we purchased put options on 140,000 ounces of gold at an average floor price of $409.75, paying approximately $1.0 million in cash for the options.

We purchased an additional 90,000 put options in the third quarter of 2005 locking in a $400 per ounce floor for each of the 90,000 ounces. Increases in gold price during the first six of 2006 resulted in a nil value for the puts at June 30, 2006. This was $0.1 million less than the value at December 31, 2005 and approximately $1.0 million less than the initial purchase cost. We have 112,500 ounces of put options with an average strike price of $404 per ounce remaining at June 30, 2006.

To acquire the put options in the third quarter of 2005, we sold 90,000 ounces of call options with a strike price of $525 per ounce. The revenue from the sale of the call options exactly offset the cost of the put options bought in the same quarter. At the beginning of 2006 there were 65,000 call options outstanding. During the second quarter of 2006 we bought back 30,000 ounces of call options for $2.6 million. Lower gold prices at June 30, 2006 resulted in a $0.3 million decrease in settlement costs of the calls and accordingly we recorded a $0.4 million mark–to–market gain on the calls. In addition call options for 17,000 ounces were exercised during the first half of 2006 requiring a $1.5 million payment to the counterparty. The payment is included in derivative loss in the Statement of Operations. At June 30, 2006 our gold call obligation consists of 18,000 ounces at $525 per ounce.

Foreign Currency Forward Positions – To help control the potential adverse impact of fluctuations in foreign currency exchange rates on the cost of equipment and materials we expect to purchase during the 2006 construction phase of the Bogoso Sulfide Expansion Project, we entered into Rand forward contracts. These contracts, established without cost, had a fair value of $(1.0) million and $1.0 million at June 30, 2006 and December 31, 2005, respectively.

The following table summarizes our derivative contracts at June 30, 2006:

												Total/
At June 30, 2006		2006				2007				Thereafter		Average
Gold put options
Ounces (thousands)			75				37.5			—			112.5
Average price per ounce ($)			405				404			—			404
Gold call options
Ounces (thousands)			12				6			—			18
Average price per ounce ($)			525				525			—			525
Foreign exchange forward contracts
South African Rand (millions)			31.5				—			—			31.5
Average rate (ZAR/$)			6.3				—			—			6.3

The puts, calls and foreign exchange forward contracts are comprised of numerous individual contracts each with a different settlement date.

						Fair value of
						EURO								Six months
		June 30,				derivative on				December 31,				(Expense)/
Fair Value of Derivatives		2006				June 19, 2006				2005				Gain
Cash–settled forward gold price agreements		$	—			$	(13,707	)		$	(9,560	)		$	(4,147	)
Puts			12				—				74				(62	)
Calls			(1,944	)			—				(2,250	)			306
Rand forward purchases			(984	)			—				1,146				(2,130	)
Euros forward purchases			—				—				(162	)			162
Unrealized loss		$	(2,916	)		$	(13,707	)		$	(10,752	)		$	(5,871	)
Realized losses:															(757	)
Cash–settled forward gold price agreements
Calls															(4,100	)
Total gains/(losses)														$	(10,728	)

14. Asset Retirement Obligations

Our Asset Retirement Obligations (“ARO”) are equal to the present value of all estimated future closure costs associated with reclamation, demolition and stabilization of our Bogoso/Prestea and Wassa mining and ore processing properties. Included in this liability are the costs of mine closure and reclamation, processing plant and infrastructure demolition, tailings pond stabilization and reclamation and environmental monitoring costs. While the majority of these costs will be incurred near the end of the mines’ lives, it is expected that certain on—going reclamation costs will be incurred prior to mine closure. These costs are recorded against the current ARO provision.

The changes in the carrying amount of the ARO were as follows:

Balance at December 31, 2005		$	11,393
Accretion expense			354
Cost of reclamation work performed			(523	)
New AROs incurred during the period			1,129
Balance at June 30, 2006		$	12,353
Current portion		$	2,735
Long term portion		$	9,618

15. Commitments and Contingencies

Our commitments and contingencies include the following items:

	(a)		Environmental Regulations – The Company’s mining and exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and are generally becoming more restrictive. As such we cannot predict the full amount of our future expenditure to comply with these laws and regulations. We conduct our operations so as to protect the environment and believe our operations are in compliance with applicable laws and regulations in all material respects.
	(b)		Environmental Bonding in Ghana – In 2005, pursuant to a reclamation bonding agreement between the Ghana Environmental Protection Agency (“EPA”) and WGL, we bonded $3.0 million to cover future reclamation obligations at Wassa. To meet the bonding requirements we established a $2.85 million letter of credit and deposited $0.15 million of cash with the EPA. In addition, pursuant to a bonding agreement between the EPA and BGL we bonded $9.5 million in early 2006 to cover our future obligations at Bogoso/Prestea. To meet these requirements we deposited $0.9 million of cash with the EPA with the balance covered by a letter of credit.
	(c)		Cash Restricted for Environmental Rehabilitation Liabilities – In 1999, we were required, according to the acquisition agreement with the sellers of BGL, to restrict $6.0 million of cash to be used for the ongoing and final reclamation and closure costs at Bogoso. Between 1999 and 2001 we withdrew $2.6 million of the restricted cash to cover our out–of–pocket cash reclamation costs. There have been no disbursements of the restricted cash since 2001. Now that BGL has met the EPA’s environmental bonding requirements, we will seek to amend the agreement with the original sellers of BGL and obtain their consent to allow us to withdraw the remaining restricted cash which now totals $3.5 million.
	(d)		Royalties –

	(i)		Dunkwa Properties: As part of the acquisition of the Dunkwa properties in August 2003, we agreed to pay the seller a net smelter return royalty on future gold production from the Mansiso and Asikuma properties. Per the acquisition agreement, there will be no royalty due on the first 200,000 ounces produced from Mampon which is located on the Asikuma property. The amount of the royalty is based on a sliding scale which ranges from 2% of net smelter return at gold prices at or below $300 per ounce up to 3.5% for gold prices in excess of $400 per ounce.
	(ii)		Government of Ghana: Under the laws of Ghana, a holder of a mining lease is required to pay an annual royalty of not less than 3% and not more than 6% of the total revenues earned from the lease area. The royalty is payable on a quarterly basis. We currently pay a 3% annual royalty on gold production from Bogoso/Prestea and Wassa.
	(iii)		Benso: Benso is subject a 1.5% net smelter return royalty and a $1.00 per ounce gold production royalty. The smelter return royalty may be purchased for $4.0 million (or $6.0 million if a feasibility study indicates more than 3.5 million ounces of recoverable gold) and the gold production royalty may be purchased for $0.5 million.

(iv)

Prestea Underground – The Prestea Underground is subject to a 2.5% net profits interest on future income. Ownership of the 2.5% net profit interest is currently held by the bankruptcy trustee overseeing liquidation of Prestea Gold Resources Limited, our former joint venture partner in the Prestea Underground.

	(e)		Afema Project – On March 29, 2005 we entered into an agreement with Societe d’Etat pour le Developpement Minier de la Cote d’Ivoire (“SO.DE.MI.”), the Cote d’Ivoire state mining and exploration company, to acquire their 90% interest in the Afema gold property in south–east Cote d’Ivoire. A $0.1 million initial payment to SO.DE.MI. provided us the right to carry out a six month detailed technical due diligence program. On September 30, 2005 a six month extension to March 29, 2006 was granted by SO.DE.MI. to allow Golden Star to carry out further due diligence work and to analyze the large quantity of data collected during 2005. On March 14, 2006, we contacted SO.DE.MI. clarifying that (i) Golden Star will be indemnified in respect of the past environmental degradation at Afema, and (ii) that no other claims against the property exist. SO.DE.MI. is still considering its response to the latter question and hence the option remains unexercised pending their decision. In addition to the acquisition payments, we agreed to pay SO.DE.MI. a royalty on any future gold production from the Afema property. The royalty is indexed to the gold price and ranges from 2% of net smelter returns at gold prices below $300 per ounce to 3.5% of net smelter returns for gold prices exceeding $525 per ounce. If we proceed with the $1.5 million payment to acquire full rights to the property, the purchase agreement requires us to spend an additional $3.5 million on exploration work at Afema, subject to exploration success, over the following three and a half years.
	(f)		We are engaged in routine litigation incidental to our business. No material legal proceedings, involving us or our business are pending, or, to our knowledge, contemplated, by any governmental authority. We are not aware of any material events of non–compliance with environmental laws and regulations.

16. Share Capital

Changes in share capital during the six months ended June 30, 2006 were:

		Shares				Amount
Balance as of December 31, 2005			205,954,582			$	522,510
Common shares issued:
Option exercises			1,815,176				4,566
Reclassification of warrants to capital surplus			—				(2,575	)
Bonus shares and other			4,000				(134	)
Balance as of June 30, 2006			207,773,758			$	524,367

17. Warrants

The following warrants were outstanding as of June 30, 2006:

Warrants

Issued with:

Date issued

outstanding

Exercise price

Expiration date

Equity offering

February 14, 2003

8,448,334

Cdn$4.60

February 14, 2007

St. Jude acquisition

December 21, 2005

3,240,000

Cdn$4.17

November 20, 2008

Total

11,688,334

The 8.4 million warrants expiring February 14, 2007 are traded on the Toronto Stock Exchange under the symbol GSC.WT.A. No warrants were exercised during the six months ended June 30, 2005 and 2006.

18. Stock Based Compensation

Stock Options – We have one stock option plan, the 1997 Stock Option Plan, as amended (the “Plan”) and options are granted under this plan from time to time at the discretion of the Compensation Committee. Options granted are non–assignable and are exercisable for a period of ten years or such other period as stipulated in a stock option agreement between Golden Star and the optionee. Under the GSR Plan, we may grant options to employees, consultants and directors of the Company or its subsidiaries for up to 15,000,000 shares of common stock. Options take the form of non–qualified stock options, and the exercise price of each option is not less than the market price of our stock on the date of grant. Options typically vest over periods ranging from immediately to four years from the date of grant. Vesting periods are determined at the discretion of the Compensation Committee.

In addition to options issued under the Plan, 2,533,176 options were issued to various employees of St. Jude in exchange for St Jude options of which 864,000 remain unexercised as of June 30, 2006. All of the remaining unexercised options held by St. Jude employees are vested. All figures shown below include the options issued to St. Jude employees.

Amounts recognized in the statements of operations with respect to the Plan are as follows:

		Six months ended June 30,
		2006				2005
Total cost during the period		$	1,045			$	802
Amount of related income tax benefit recognized to income			—				—

We granted 746,000 and 514,000 options during the six months ended June 30, 2006 and June 30, 2005, respectively. The Company recognized $1.0 million and $0.9 million of non–cash compensation expense in the six months ended June 30, 2006 and 2005, respectively.

The fair value of options granted during the first six months of 2006 and 2005 were estimated at the grant dates using the Black–Scholes option–pricing model based on the assumptions noted in the following table:

		Six months ended June 30,
		2006				2005
Expected volatility		62.5% to 96.1%					34.9%
Risk–free interest rate		2.44% to 2.78%				3.15% to 3.52%
Expected lives			3.5 to 5 years				3.5 to 5 years
Dividend yield			0%				0%

Expected volatilities are based on the historical volatility of Golden Star’s shares. Golden Star uses historical data to estimate share option exercise and employee departure behavior used in the Black–Scholes model; groups of employees that have similar historical behavior are considered separately for valuation purposes. The expected term of the options granted is derived from the output of the option pricing model and represents the period of time that the option granted are expected to be outstanding; the

range given below results from certain groups of employees exhibiting different post–vesting behaviors. The risk–free rate for periods within the contractual term of the option is based on the Canadian Chartered Bank Administered Interest rates in effect at the time of the grant.

A summary of option activity under the Plan as of June 30, 2006 and changes during the six months then ended is presented below:

										Weighted–
						Weighted–				Average
						Average				Remaining				Aggregate
		Options				Exercise price				Contractual				intrinsic value
		(000’)				(Cdn$)				Term (Years)				($000)
Outstanding as of December 31, 2005			7,390				2.75				—				—
Granted			746				3.94				—				—
Exercised			(1,815	)			1.97				—				—
Forfeited			(136	)			7.07				—				—
Outstanding as of June 30, 2006			6,185				2.99				5.7				7,174
Exercisable at June 30, 2006			4,026				1.78				4.2			$	7,174

The weighted–average grant date fair value of share options granted during the six months ended June 30, 2006 and June 30, 2005 was Cdn$2.50 and Cdn$1.58, respectively. The intrinsic value of options exercised during the six months ended June 30, 2006 and 2005 was $2.1 million and $0.1 million, respectively.

A summary of the status of non–vested options at June 30, 2006 and changes during the six months ended June 30, 2006, is presented below:

						Weighted
						average grant
		Number of				date fair value
		options (‘000)				(Cdn$)
Nonvested at January 1, 2006			155				2.03
Granted			746				1.84
Vested			(610	)			1.84
Forfeited			(71	)			2.09
Nonvested at June 30, 2006			220				1.88

As of June 30, 2006 there was a total unrecognized compensation cost of $1.0 million related to non–vested share–based compensation granted under the Plan. That cost is expected to be recognized over a weighted–average period of 2.8 years. The total fair values of shares vested during the six months ended June 30, 2006 and 2005 were Cdn$1.1 million and Cdn$0.4 million, respectively.

Stock Bonus Plan – In December 1992, we established an Employees’ Stock Bonus Plan (the “Bonus Plan”) for any full–time or part–time employee (whether or not a director) of the Company or any of our subsidiaries who has rendered meritorious services which contributed to the success of the Company or any of its subsidiaries. The Bonus Plan provides that a specifically designated committee of the Board of Directors may grant bonus common shares on terms that it might determine, within the limitations of the Bonus Plan and subject to the rules of applicable regulatory authorities. The Bonus Plan, as amended, provides for the issuance of 900,000 common shares of bonus stock of which 495,162 common shares had been issued as of June 30, 2006.

During the six months ended June 30, 2006 and 2005 we issued 4,000 and 45,342 common shares, respectively, to employees under the Bonus Plan.

19. Income Taxes

Income tax (expense)/benefit attributable to net income before income taxes consists of:

		Three months ended June 30,								Six months ended June 30,
		2006				2005				2006				2005
Current
Canada		$	—			$	—			$	(4,926	)		$	—
Foreign			—				—				—				—
Future
Canada			3,117				—				3,118				—
Foreign			(11,411	)			(33	)			(5,163	)			21
Total		$	(8,294	)		$	(33	)		$	(6,971	)		$	21

The current tax expense recorded for the six months ended June 30, 2006 is for the gain on sale of the Moto shares. The Canadian future tax benefit recorded relates primarily to exploration expenditures incurred by St. Jude. The foreign future tax expense recorded for the six months ended June 30, 2006 relates primarily to the sale of EURO (see Note 6), derivative losses incurred, and the decrease in the Ghanaian tax rate. Golden Star records a valuation allowance against any portion of its remaining future income tax assets that it believes will, more likely than not, fail to be realized.

20. Earnings per Common Share

The following table provides a reconciliation between basic and diluted earnings per common share:

		Three months ended								Six months ended
		June 30,								June 30,
		2006				2005				2006				2005
Net income/(loss)		$	14,424			$	(3,695	)		$	33,447			$	(5,918	)
Weighted average number of common shares (millions)			207.1				142.4				207.2				142.4
Dilutive securities:
Options			1.9				1.7				2.0				1.9
Warrants			—				0.1				—				0.2
Weighted average number of diluted shares			209.0				144.2				209.2				144.5
Basic earnings/(loss) per share		$	0.070			$	(0.026	)		$	0.161			$	(0.042	)
Diluted earnings/(loss) per share		$	0.069			$	(0.026	)		$	0.160			$	(0.042	)

21. Supplemental Cash Flow Information

No cash income taxes were paid during the six months ended June 30, 2006 and 2005. Cash paid for interest was $2.5 million and $0.4 million for June 30, 2006 and 2005, respectively. A total of $11,000 and nil of depreciation was included in general and administrative costs or was capitalized into projects for the quarters ended June 30, 2006 and 2005, respectively.

22. Operations by Segment and Geographic Area

The following segment and geographic data includes revenues based on product shipment origin and long–lived assets based on physical location. The corporate entity is incorporated in Canada.

		Africa – Ghana
As of and for the		Bogoso/												South
three months ended June 30,		Prestea				Wassa				Other				America				Corporate				Total
2006
Revenues		$	14,903			$	13,851			$	2			$	2,119			$	645			$	31,520
Net income/(loss)			2,039				(114	)			(601	)			(5,263	)			18,363				14,424
Total assets			234,632				105,432				206,224				1,031				55,343				602,662
2005
Revenues		$	14,233			$	9,190			$	—			$	1,050			$	450			$	24,923
Net income/(loss)			1,769				(2,627	)			—				469				(3,306	)			(3,695	)
Total assets			103,221				90,126				35,264				3,301				78,115				310,027

		Africa – Ghana
As of and for the		Bogoso/												South
six months ended June 30,		Prestea				Wassa				Other				America				Corporate				Total
2006
Revenues		$	26,457			$	27,279			$	17			$	3,984			$	1,175			$	58,912
Net income/(loss)			857				(2,251	)			3,024				(8,335	)			40,152				33,447
Total assets			234,632				105,432				206,224				1,031				55,343				602,662
2005
Revenues		$	30,950			$	9,190			$	—			$	2,119			$	715			$	42,974
Net income/(loss)			3,595				(2,676	)			—				407				(7,244	)			(5,918	)
Total assets			103,221				90,126				35,264				3,301				78,115				310,027

23. Related Parties

During the first half of 2006 we obtained legal services from a legal firm to which our Chairman is counsel. Total value of all services purchased from this law firm during the first half was $0.6 million. Our Chairman did not personally perform any legal services for us during the first quarter nor did he benefit directly or indirectly from payments for the services performed by the firm.

During the first quarter of 2006, a corporation controlled by Michael A. Terrell, a director of Golden Star, provided management services to St. Jude for which it was paid Cdn$0.13 million. Mr. Terrell became a director of Golden Star following our acquisition of St. Jude in December 2005. Mr. Terrell’s company ceased providing services to St. Jude at March 31, 2006.

24. Financial Instruments

Fair Value – Our financial instruments are comprised of cash, short term investments, accounts receivable, restricted cash, accounts payable, accrued liabilities, accrued wages, payroll taxes, derivatives and debt. The fair value of cash and short term investments, derivatives, accounts receivable, accounts payable, accrued liabilities and accrued wages, payroll taxes and current debt equals their carrying value due to the short term nature of these items. The fair value of restricted cash is equal to the carrying value as the cash is invested in short term, high–quality instruments.

25. Generally Accepted Accounting Principles in the United States

Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in Canada, which differ from US GAAP. The effect of applying US GAAP to our financial statements is shown below.

(a) Consolidated Balance Sheets Under US GAAP

		June 30,				December 31,
		2006				2005
		(Restated-Note d13)				(Restated-Note d13)
ASSETS
Current assets:
Cash and cash equivalents		$	20,882			$	89,709
Short term investments			21,080				—
Accounts receivable			7,339				6,560
Inventories			35,801				23,181
Future tax assets			—				6,248
Fair value of derivatives			12				1,220
Deposits			9,637				5,185
Other current assets			492				686
Total current assets			95,243				132,789
Restricted cash			5,093				3,865
Long term investments (Notes d1 and d2)			—				15,182
Deferred exploration and development costs (Notes d3 and d4)			—				—
Property, plant and equipment (Note d5)			84,824				83,813
Mine construction in progress			115,257				36,707
Mining properties (Notes d3, d4 and d5)			239,119				237,153
Deferred stripping (Note d6)			—				1,548
Loan acquisition costs			766				1,020
Future tax asset			4,456				8,223
Other assets			592				1,124
Total assets		$	545,350			$	522,443
LIABILITIES
Current liabilities		$	51,962			$	40,815
Long term debt (Note d8)			64,253				66,632
Asset retirement obligations			9,618				8,286
Future tax liability			42,263				45,072
Fair value of long term derivatives (Note d7)			8,703				15,842
Total liabilities			176,799				176,647
Minority interest			2,070				1,964
Commitments and contingencies			—				—
SHAREHOLDERS’ EQUITY
Share capital (Note d9)			525,554				523,696
Contributed surplus (Note d10)			6,750				4,419
Accumulated comprehensive income and other (Note d2)			1,316				9,495
Deficit			(167,139	)			(193,778	)
Total shareholders’ equity			366,481				343,832
Total liabilities and shareholders’ equity		$	545,350			$	522,443

(b) Consolidated Statements of Operations under US GAAP

		Three months ended June 30,								Six months ended June 30,
		2006				2005				2006				2005
		(Restated-Note d13)				(Restated-Note d13)				(Restated-Note d13)				(Restated-Note d13)
Net income under Cdn GAAP		$	14,424			$	(3,695	)		$	33,447			$	(5,918	)
Deferred exploration expenditures expensed per US GAAP (Note d3)			(4,947	)			999				(7,833	)			(3,575	)
Impact of start-up accounting			—				(1,072	)			—				(5,725	)
Depreciation and amortization differences – Wassa (Note d5)			262				—				1,737				—
Write-off of deferred exploration properties (Note d3)			—				—				—				1,083
Derivative gain/(loss) on non-US$ warrants (Note d11)			496				(947	)			(124	)			4,483
Other (Notes d3 and d7)			509				180				505				220
Net income/(loss) under US GAAP before minority interest			10,744				(4,535	)			27,732				(9,432	)
Minority interest, as adjusted			(220	)			54				(62	)			56
Net income/(loss) under US GAAP			10,524				(4,481	)			27,670				(9,376	)
Other comprehensive income – gain on marketable securities (Note d2)			—				(156	)			—				893
Comprehensive income/(loss)		$	10,524			$	(4,637	)		$	27,670			$	(8,483	)
Basic net income/(loss) per share under US GAAP before cumulative effect of change in accounting method		$	0.051			$	(0.031	)		$	0.134			$	(0.066	)
Diluted net income/(loss) per share under US GAAP before cumulative effect of change in accounting method		$	0.050			$	(0.031	)		$	0.132			$	(0.065	)

(c) Consolidated Statements of Cash Flows under US GAAP

		Three months ended June 30,								Six months ended June 30,
		2006				2005				2006				2005
Cash provided by (used in):
Operating activities		$	(4,984	)		$	(4,243	)		$	(13,407	)		$	(11,284	)
Investing activities			(60,072	)			(44,146	)			(60,312	)			(39,712	)
Financing activities			(845	)			49,756				4,892				56,505
Increase/(Decrease) in cash and cash equivalents			(65,901	)			1,367				(68,827	)			5,509
Cash and cash equivalent beginning of period			86,783				17,019				89,709				12,877
Cash and cash equivalents end of period		$	20,822			$	18,386			$	20,822			$	18,386

(d) Notes:

	(1)		Minority investments in entities whose major business is mineral exploration are deemed for US GAAP to be equivalent to exploration spending and are expensed as incurred.
	(2)		Under US GAAP, investments in marketable equity securities are marked to fair value at the end of each period with gains and losses recognized in the statement of operations. Under Cdn GAAP gains and losses on marketable equity securities are noted in the foot notes and recognized in the statement of operations only when the investment is sold.
	(3)		Under US GAAP, exploration, acquisition (except for Purchase Accounting costs) and general and administrative costs related to exploration projects are charged to expense as incurred. Under Cdn GAAP, exploration, acquisition and direct general and administrative costs related to exploration projects are capitalized. In each subsequent period, the exploration, engineering, financial and market information for each exploration project is reviewed by management to determine if any of the capitalized costs are impaired. If found impaired, the asset’s cost basis is reduced in accordance with Cdn GAAP provisions.
	(4)		Under US GAAP, the initial purchase cost of mining properties is capitalized. Pre-acquisition costs and subsequent development costs incurred, until such time as a final feasibility study is completed, are expensed in the period incurred. Under Cdn GAAP, the purchase costs of new mining properties as well as all development costs incurred after