In accordance with National Instrument 51-102 released by the Canadian Securities Administrators the Company discloses that its external auditors have not reviewed the unaudited financial statements for the period ended June 30, 2005 in accordance with Section 7050 of the CICA Handbook.

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NEW GUINEA GOLD CORPORATION
Consolidated Balance Sheets
As at June 30, 2005 and December 31, 2004
(June 30, 2005 - unaudited - Prepared by Management)

Approved by the Board of Directors:

The accompanying notes are an integral part of these consolidated financial statements.

NEW GUINEA GOLD CORPORATION
Consolidated Statements of Operations and Deficit
For the Three and Six Months Ended June 30,

The accompanying notes are an integral part of these consolidated financial statements.

NEW GUINEA GOLD CORPORATION
Consolidated Statements of Cash Flows
For the Three and Six Months Ended June 30,

Supplemental Disclosure of Non-Cash Investing and Financing Activities:
There were no such activities during the six-month period ended June 30, 2005.

During 2004, the Company:

• Issued 1,400,000 common shares valued at $560,000 for the acquisition of 50% of Kanon Resources (refer to note 8).
• Received 200,000 common shares of Vangold valued at $104,000 as an option payment for mineral property, of which 20,000 shares ($10,400) were assigned to a third party as a finder's fee.
• Issued 150,000 common shares valued at $67,500 for financing fees.
  

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

NEW GUINEA GOLD CORPORATION
Consolidated Schedule of Deferred Mineral Property Costs

NEW GUINEA GOLD CORPORATION
Notes to Consolidated Financial Statements
Six Months Ended June 30, 2005

1. NATURE OF OPERATIONS AND CONTINUANCE OF BUSINESS

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

7. SHARE CAPITAL AND RELATED INFORMATION

a) Authorized: 100,000,000 common shares without par value

b) Issued and outstanding:

c) Stock options

Stock option activity for the six months ended June 30, 2005 and 2004:

The fair value of stock options and warrants granted during 2005 and 2004 are estimated on the date of their grant using the Black-Scholes option pricing model using the following assumptions:

Option pricing models require the use of estimates and assumptions including the expected volatility. Changes in the underlying assumptions can materially affect the fair value estimates and, therefore, existing models do not necessarily provide a reliable measure of the fair value of the grant of the Company's stock options.

Amounts expensed as stock-based compensation are credited to contributed surplus. On exercise, the amounts originally credited to contributed surplus are credited to share capital.

d) Warrants
Warrants outstanding at June 30, 2005:

8. ACQUISITION OF 50% INTEREST IN KANON REOURCES LTD.

On February 25, 2004, the Company acquired a 50% interest in Kanon Resources Ltd. (Kanon), a private Papua New Guinea company which owns five exploration projects in New Guinea, by the issue of 1,400,000 shares valued at $7,475, cash payments of 70,000, and the granting of an 8% carried interest in any mine developed in the future by Kanon, subject to the Company retaining the option to acquire 50% of the carried interest (4%) for $1,000,000.

Kanon was controlled by parties related to management of the Company.


9. ACQUISITION OF MACMIN (PNG) LTD.

On March 31, 2003, the Company acquired 100% of Macmin (PNG) Limited, a wholly-owned exploration stage subsidiary of Macmin Silver Ltd, the Company's controlling shareholder, by the issue to Macmin Silver Ltd. of 2,250,000 of its common shares. Macmin (PNG) Limited was the Company's joint venture partner on some of its Papua New Guinea properties and owned a 75% interest in them. The operations of Macmin (PNG) Ltd. have been included in these financial statements since the date of its acquisition by the Company.


10. MINERAL PROPERTIES

The Company's mineral properties are all located in Papua New Guinea.

The Company has a 100% interest in five, a 90% interest in two, a 60% interest in one, and a 50% interest in 4 exploration projects in Papua New Guinea through its wholly-owned subsidiary Macmin PNG and its 50% owned subsidiary Kanon Resources Ltd. (refer to notes 8 and 9). The Company is conducting operations on the Sinivit, Normanby, Sehulea, Simuku, and Mt. Penck Projects.

These projects are subject to a 1% Net Smelter Royalty (NSR) payable, and the issue of 9% of the Company's issued share capital to Macmin PNG at the time that any mine is developed on these properties and production is achieved in excess of 50,000 ounces of gold or equivalent in any year.


Sinivit
The Sinivit property is held under three titles in which Macmin PNG, acquired by the Company, has a direct 90% equity interest and a further 2.5% indirect equity interest.

Normanby
The Normanby Licence covers approximately 68 square kilometres on Normanby Island, Milne Bay Province.

Sehulea
The Sehulea Project covers approximately 30 square kilometres in the eastern part of Normanby Island, in Milne Bay Province, adjacent to the Normanby Project.

Simuku
The West New Britain Porphyry Copper/Gold Project covers four exploration licenses totaling 3,093 square kilometers.

Mt Penck
The Company has elected to earn a direct 20% interest in the Mt. Penck property by funding the first CDN$300,000 worth of exploration. The Company has completed its earn in and has an effective 60% interest in the property. The Mt. Penck exploration licence covers 102.6 square kilometres in area and is 55 kilometres west of Kimbe in the West New Britain Province.

The Company has optioned out the following projects:

Crater Mountain

• Optioned by agreement dated January 6, 2004 to Celtic Minerals Ltd., a TSX Venture-listed company, which can acquire a 51% interest by expending $2,000,000 on exploration prior to March 1, 2006, and a further 25% interest can be acquired upon completion of a further $2,000,000 exploration program prior to March 1, 2009.

• Vangold Resources Ltd., a TSX Venture company has been granted the right to earn up to 75% interest by performing $2,500,000 in exploration over three years, of which $500,000 must be spent by September 26, 2004, (completed) and by issuing to the Company 200,000 shares upon receipt of regulatory consent to the agreement (issued) and a further 600,000 shares in stages prior to June 30, 2006 (400,000 shares have been received to date). The Company must pay a finder's fee of 10% on all share consideration received (60,000 Vangold shares paid).

• Optioned to Kanon, whereby Kanon can acquire a 50% interest by spending $250,000 on exploration within two years and issue to the Company 5% of its issued share capital.