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Silverado Gold Mines Ltd – ‘10KSB’ for 11/30/08

On:  Friday, 3/13/09, at 5:41pm ET   ·   As of:  3/16/09   ·   For:  11/30/08   ·   Accession #:  1062993-9-823   ·   File #:  0-12132

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  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 3/16/09  Silverado Gold Mines Ltd          10KSB      11/30/08    5:1.5M                                   Newsfile Corp/FA

Document/Exhibit                   Description                      Pages   Size 

 1: 10KSB       Annual Report by a Small Business -- form10ksb      HTML    994K 
 2: EX-31.1     Certification -- Sarbanes-Oxley Act - Sect. 302     HTML      9K 
 3: EX-31.2     Certification -- Sarbanes-Oxley Act - Sect. 302     HTML      9K 
 4: EX-32.1     Certification -- Sarbanes-Oxley Act - Sect. 906     HTML      6K 
 5: EX-32.2     Certification -- Sarbanes-Oxley Act - Sect. 906     HTML      6K 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-KSB

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

For the fiscal year ended: November 30, 2008

OR

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

For the transition period from ____________ to ____________

Commission File Number 0-12132

SILVERADO GOLD MINES LTD.
(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)

Issuer's telephone number: (800) 665-4646

Securities registered under Section 12(b) of the Exchange Act: None.

Securities registered under Section 12(g) of the Exchange Act: Common Stock, no par value.

Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. [   ]

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

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [   ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [   ]    No [ X ]

State issuer’s revenues for its most recent fiscal year: $0

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price atwhich the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60 days: $8,679,000 as of March 6, 2009.

The number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 1,098,612,771 common shares, no par value, outstanding as of March 6, 2009.

Documents Incorporated By Reference: None.

Transitional Small Business Disclosure Format (check one): Yes [   ]    No [X]

TABLE OF CONTENTS

PART 1

ITEM 1. DESCRIPTION OF BUSINESS.

FORWARD-LOOKING STATEMENTS

The information in this Annual Report on Form 10-KSB contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve risks and uncertainties, including statements regarding our capital needs, business plans and expectations. Such forward-looking statements involve risks and uncertainties regarding the market price of gold, availability of funds, government regulations, common share prices, operating costs, capital costs, outcomes of test mining activities and other factors. Forward-looking statements are made, without limitation, in relation to operating plans, property exploration activities, including test mining activities, availability of funds, environmental reclamation, operating costs and permit acquisition. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan”, “intend,” “anticipate,” “believe,” “estimate,”

“predict,” “potential,” or “continue,” and the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined below, and, from time to time, in other reports we file with the SEC. These factors may cause our actual results to differ materially from any forward-looking statement. We disclaim any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

INTRODUCTION

Silverado Gold Mines Ltd. (“Silverado” or the “Company”) is engaged in the acquisition and exploration of mineral properties in the State of Alaska, through its wholly-owned subsidiary, Silverado Gold Mines Inc., and in the development of a liquid fuel derived from low-rank coal through its other wholly-owned subsidiary, Silverado Green Fuel, Inc.

Silverado has committed over three decades of work to the exploration, development and test mining of gold properties throughout North America. In the mid-1980s, the Company decided to focus its efforts in Alaska. We have extensive experience in geological, geochemical and geophysical exploration techniques. Our mineral holdings are located in the Fairbanks Mining District and in the Koyukuk Mining District, consisting of both lode and placer mining claims. At the present time, our primary focus is the exploration and development of our Nolan Gold Project and our Hammond property located 175 miles north of Fairbanks, Alaska. We are also continuing with exploration activities on our Eagle Creek Property and our Ester Dome Project, which are both located in the Fairbanks Mining District.

Silverado has been working for seven years through its “Low-Rank Coal-Water Fuel (Green Fuel)” division on the development of “Green Fuel”, a non-toxic liquid fuel product derived from sub-bituminous and lignite coal. In its finished form the fuel is a non-toxic, non-hazardous environmentally friendly strategic (liquid) fuel. Silverado is seeking financing to enable us to proceed with the construction of a commercial demonstration facility designed to document the combustion characteristics of Green Fuel. A successful demonstration project could lead to construction of a commercial production facility to manufacture the low-rank coal-water fuel as a replacement fuel for oil fired boilers and utility generators. In addition we look forward to our continued planning and progress designed to create a secondary fuel and other product facility designed to gasify and liquefy our green fuel to facilitate the creation of low cost rocket fuel, aviation fuel, gasoline, diesel fuel, synthetic natural gas, synthetic petrochemical feed–stocks, hydrogen for fuel cells, plastic, fertilizers, explosives, urea, ammonia CO2 for enhanced recovery in oil well production as well as a host of other products, all free of sulphur, heavy metals and particulate matter.

CORPORATE ORGANIZATION

Silverado Gold Mines Ltd. is a corporation organized under the laws of British Columbia, Canada. The Company was originally incorporated in June 1963. Silverado operates in the United States through its wholly owned subsidiaries, Silverado Gold Mines Inc., (incorporated May 29, 1981) and Silverado Green Fuel Inc. (incorporated August 14, 2006). We filed a transition application and notice of articles with the British Columbia Registrar of Companies on April 20, 2004 in order to replace our former memorandum adopted under the British Columbia Company Act and to alter our current articles to the extent necessary to ensure compliance with the British Columbia Business Corporations Act (the “BC Business Corporations Act”). The BC Business Corporations Act came into

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force in British Columbia on March 29, 2004 and replaced the former British Columbia Company Act. The transition notice and notice of articles was filed under the BC Business Corporations Act that requires any British Columbia company incorporated under the former British Columbia Company Act to effect transition under the BC Business Corporations Act by filing with the British Columbia Registrar of Companies a transition application and notice of articles within two years following the coming into force of the BC Business Corporations Act.

Our exploration activities are managed and conducted by affiliated companies, Tri-Con Mining Ltd. (“Tri-Con”) and Tri-Con Mining Inc., pursuant to written operating agreements. Each of Tri-Con, and Tri-Con Mining Inc. are privately-owned corporations controlled by Garry L. Anselmo, who is our president, chief executive officer, chief financial officer, and the chairman of our board of directors.

MINERAL EXPLORATION BUSINESS

We are a mineral exploration company with interests in properties located throughout the state of Alaska. The majority of such properties are in the early stages of exploration, and there is no assurance that a commercially viable mineral deposit exists on such properties. Effective January 1, 2009, based on completion of a preliminary feasibility study, our Nolan Gold and Antimony Lode Project has disclosed an economically viable mineral reserve. The preliminary feasibility study concluded that the resource estimates disclosed by the Company in its Current Report on Form 8-K on November 17, 2008 can be reclassified as a probable reserve. Though there were no material changes to the grades and quantities previously reported on November 17, 2008, there was additional data produced that added new grades and there was further work conducted on this zone that resulted in the aforementioned reclassification.

Certain definitions of geological and technical terms used in this Annual Report on Form 10-KSB are provided in the Glossary of Terms under Item 2. Readers and investors are cautioned that many of these terms, such as “inferred resource” and “indicated resource” are terms used and accepted by the Canadian Institute of Mining (CIM), and although these terms are recognized and required by the Canadian Securities regulations, they are not recognized by the United States Securities and Exchange Commission.

We hold interests in the following four groups of mineral properties in Alaska:

A description of our operations with respect to each of these mineral properties is as follows:

1.    Description of Operations at the Nolan Gold Project

1.1    Nolan Gold Project Background

The Nolan Gold Project consists of both placer-style and lode-style deposit types for exploration and development. The Nolan Placer Gold Project involves exploration and development of gold occurring in placer deposits such as stream channels or ancient remnants of placer gold deposits. The Nolan Lode Gold and Antimony Project consists of exploration work designed to locate bedrock structures or formations of bedrock which host gold and antimony mineralization. These two facets of the Nolan Gold Project complement each other, as every stone or pebble in a placer deposit is a piece of rock eroded from some near or distant bedrock formation, and each gold nugget or grain of gold in a placer deposit was originally part of a bedrock formation or structure with lode gold mineralization. Because a placer deposit originates from a lode source, the search for the Nolan lode source involves unraveling the sequences of events that caused a placer deposit to form, as well as applying various geological, geochemical and geophysical exploratory investigations.

The Nolan Gold Project consists of numerous mineral prospects that are in the early stages of exploration, as well as mineral prospects in the advanced stages of exploration. During the years previous to 2007, the Company focused only minimal exploration effort on finding a lode source for gold and focused mostly on the exploration and development of placer gold. During 2008, the Company focused its efforts on the Nolan Gold and Antimony Project which is in the advanced stages of exploration and is potentially moving toward the development stage. During September of 2008, the Company commissioned an independent mining consultant to perform a preliminary feasibility study of the Workman’s Bench lode gold and antimony deposit. The results were released to the public on January 5, 2009.

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The previous bulk sampling projects of placer gold from the gravel benches along the left limit of Nolan Creek was indicated that there was an association between some of the placer gold recovered and an antimony sulfide mineral called stibnite which commonly associated with coated some of the coarser and angular gold nuggets. Stibnite is a sulfide mineral, and is a common pathfinder mineral for gold exploration and consists of the elements antimony and sulfur.

1.2    Nolan Gold Project’s Exploration Approach and Focus

2007

The new exploration approach involves not only looking for the lode source of the gold, but also giving economic consideration to the element antimony in addition to the gold, for exploration and development. In 2007, the Company began a new systematic and more scientific approach that combined soil and rock (surface) geochemical data and geophysical data (airborne and ground) with subsurface drill core geochemical and geological data. The data was compiled into a Geographical Information System (GIS) database. All GIS surface data acquired in the field was located with a Global Positioning System (GPS).

In 2007, the Company began focusing on the lode source of the gold and antimony in the areas referred to as Pringle Bench and Workman’s Bench. These two target areas are underlain by a quartz-gold-antimony veined zone that is part of a sheared and faulted structural zone referred to by the Company as the Solomon Shear Zone. The Company excavated eight trenches totaling 440 lineal feet of bedrock in the Pringle and Workman’s Benches and collected continuous chip samples from the bedrock that included the gold and antimony veins. The Company will continue to use the excavation of trenches to assist in exploration, especially to aid in defining drill targets, taking advantage of the historic roads and trails that allow transport of heavy equipment for exploration purposes.

In 2007, the Company acquired a tracked and mobile diamond core drill for exploration. The diamond core drill, and the 2 inch diameter (NQ) core, allow the geologist to make determination of the true width of mineralized veins and the relationship of the vein to other primary geologic structures. The diamond drill core allows for more accurate analysis of grade and interpretation of style of mineralization and timing of mineralization relative to other structures in the rock.

During 2007, the new soil and rock geochemical data and geophysical data further delineated the northeast trending structural zone, referred to by the Company as the Solomon Shear Zone, which is associated with gold and antimony mineralization. The new approach in 2007 involved the first phase of drilling, using the newly acquired diamond core. A total of 18 holes were drilled across the Solomon Shear Zone. The diamond core drilling data supported the geochemical and geophysical data. The drilling was focused on the Workman’s and Pringle Benches located on the south and north sides of Smith Creek respectively

During 2007, the Company’s exploration efforts in the Fortress area delineated gold and arsenic soil anomalies which coincide with east-west VLF-EM ground geophysical anomalies interpreted by the Company as possibly new mineralized structural trends. The Fortress area has never been drilled and is still in the earliest stages of exploration.

Exploration efforts in 2007 did not result in finding a commercially viable mineral deposit.

2008

During the winter of 2008, the Company excavated 570 feet of exploration tunnels into the bedrock below Workman’s Bench. During the summer of 2008, the Company began the second phase of diamond core drilling, focusing on the Workman’s Bench area, and did not drill north of Smith Creek. The Company continued with the ground (non airborne) very low frequency electromagnetic (VLF-EM) geophysical grid in the Fortress area located on the north end of the property.

The drilling under Workman’s Bench delineated 1,300 feet of gold and antimony mineralization in near vertical structures or veins that extend down dip two hundred feet and remain open at depth. The steeply dipping (near vertical) veins are much more favorable for mining and engineering purposes than lower angled subsurface structures. The 1,300 ft long and 80 to 100 ft wide zone of quartz-antimony-gold veins extends from Smith Creek southwest across Workman’s Bench and is interpreted by the Company to have been offset by a left-lateral fault at its southern extent. The interpretation of the left-lateral fault is based off of both geophysical data, and drill data, and it has possibly displaced the quartz-antimony-gold veined zone. The 1,300 ft long veined zone, located south of Smith Creek, under Workman’s Bench, requires 600 ft of infill drilling to confirm whether the zone connects with the veined zone underlying the Pringle Bench, which was drilled in 2007. The Company attempted to infill drill the area in the fall of 2008, but freezing temperatures halted that effort.

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The 2007 and 2008 drill results in the Workman’s Bench area were not sufficient to define a provable reserve, but the drill results combined with the recently released preliminary feasibility study, was sufficient enough to define a probable reserve. Reserves are listed in Item 2, below.

Another Nolan Gold Project prospect is located at the Hillside Zone, which is northeast of the Pringle Bench and along strike of the five mile long Solomon Shear Zone, The Hillside Zone was drilled previously in 2003. Five inclined percussion reverse circulation (RC) drill holes did not begin to intercept the veined zone until the extreme eastern extent of the eastern-most hole. The new GIS compiled data sets, indicate the previous collar locations were too far west. The new technological approach will allow the Company to select more accurate drill collar locations and drill hole orientations. The Hillside Zone was not drilled since 2003, but is a planned target area for drilling in 2009, upon the completion of infill drilling under the Pringle and Workman’s Benches.

Another Nolan Gold Project prospect that has potential for a lode gold source for exploration and development is located on the north end of the property in an area referred to by the Company as the Fortress. The Fortress area contains a slightly different gold-sulfide association and may be part of a different gold system. The orientation of the gold bearing quartz veins is east-west or slightly northwest to southeast, in contrast to the northeast striking gold-antimony bearing veins associated with the Solomon Shear Zone. The trace metals chemistry in the gold and the interpreted paleoflow direction of the recent glaciation indicate an association between the placer gold in the historic Thompson Pup placer deposits and the gold mineralization in the Fortress area.

In addition, our operations involve honoring our obligations to return the land to its natural state when possible. During 2007, we removed scrap materials and sealed the Swede Channel and Mary’s East sub surface placer exploration portals as part of our reclamation obligations with the Bureau of Land Management. During 2008, we reclaimed 27.5 acres of disturbed land as part of our continued reclamation obligations with the Bureau of Land Management. We will continue to work on our reclamation obligations with the Bureau of Land Management.

A more detailed description of our Nolan Gold Project operations is discussed in the following sections:

1.3    Nolan Gold Bulk Sampling Projects

1.3.1    2007 Placer Gold Bulk Sampling Projects

2007 Swede Channel and Mary’s East Bulk Sampling Projects

The Swede Channel and Mary’s East placer deposits represent the last bulk placer sampling projects that the Company has undertaken, and are disclosed herein as part of the background of the Company’s operations.

The Swede Channel Placer Gold Deposit (“Swede Channel”) is a glacial drainage perched several hundred feet above the Nolan Creek Valley. During the ice age, a glacial event caused the Swede Gulch to rapidly erode a deep, narrow water channel across earlier gold bearing river gravel deposits. Erosion and transportation caused the gold bearing gravel to be re-concentrated due to removal of the lighter gangue minerals, while much of the heavier gold, along with boulders and coarse gravel common to a high energy drainage environment, was deposited to the Swede Channel. Subsequent post glacial uplift and erosion has established the present topography including the perched Swede Channel location on the westerly flank of Smith Dome, and overlain by up to 100 feet of overburden making it an unidentifiable surface topographic expression.

The Mary’s East Placer Gold Deposit (“Mary’s East”) is located a few hundred yards northeast of the Swede Channel and directly east of Mary’s Bench Placer Gold Deposit. Unlike the gold concentrations in the Swede Channel, the placer gold in Mary’s East is concentrated in landslide material that was deposited onto a bedrock shelf during the ice age.

Swede Channel and Mary’s East 2007 Work

During the winter of 2006, Silverado re-opened the Swede portal and continued with its underground exploration and development program on the remaining sections of the Swede Channel until its completion by the middle of January 2007. A total of 8,963 loose cubic yards (“LCY”) of gravel material was stockpiled from the remaining Swede Channel.

In early January 2007, crews installed a portal into Mary’s East, and began an underground drift into the Mary’s East deposit. The Mary’s East project was completed at the end of March 2007 and 9,357 LCY of gravel material was stockpiled from this project.

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The 2006-2007 winter stockpile contained 18,320 LCY (Swede Channel and Mary’s East combined) of gravel material, and was processed from June through July of 2007 at the existing sluice plant location, yielding 2,811.74 troy ounces of gold nugget gold and over 207 pounds of concentrate that contained gold particles smaller than ¼ inch in size. The fine concentrate yielded 915.06 troy ounces of gold (30% gold), which when combined with 2811.74 troy ounces of nugget gold recovered in 2007 totals 3726.80 troy ounces. Also, the fine concentrates yielded 65.10 troy ounces of silver or 2.15% silver.

The Swede channel and Mary’s East portals were both sealed after completion of the underground bulk sampling projects. Both sites were reclaimed in summer 2007 as required by the Bureau of Land Management.

1.3.2    2008 Nolan Lode Gold and Antimony Bulk Sampling Project

During 2008, the Company did not explore for placer gold resources. The exploration efforts involved the systematic process that may eventually allow for the extraction of a bulk sample or samples of gold-bearing semi-massive to massive stibnite (antimony mineral) from a lode source for mineral processing and metallurgical testing, with consideration for both gold and antimony as potential resources.

On November 16, 2007, we began the excavation of the Workman’s Bench Portal and continued excavating 570 feet of underground workings into the bedrock below Workman’s Bench. The tunnels were finished in early February of 2008. The tunnels are interconnected and serve a multitude of purposes. The first purpose was for determining the overall width of the veined gold and antimony mineralized zone and establishing the strike and dip of the individual quartz-gold-antimony veins. The second purpose was for the collection of insitu bedrock channel samples for geochemical assays, and the third was for the collection of significantly larger (bulk) samples of the main gold and antimony vein referred to by the Company as the Zone A vein, that typically consists of massive stibnite and gold, for more accurate geochemical assays as well as for preliminary milling and processing studies of the gold and antimony.

The final purpose of the tunnels is for access and egress for future bulk sampling at depth. Depending on funding, the Company plans to collect either a 1,000 cubic yard or 2,000 cubic yard bulk sample of the main gold and antimony vein referred to by the Company as the A Zone Vein. Other potential targets for future exploration and development include the West Zone, B Zone and C Zone that parallel the main A Zone Vein.

Bulk Sample of the ‘A’ Zone Vein

Prior to 2008, the Company had not completed mineral processing or tests for mineral processing of lode mineralization in the Nolan Creek area.

Thomas K. Bundtzen (the “QP”), an independent and AIPG Certified Professional Geologist, served as an independent third-party qualified person to the Company for the purpose of certifying and collecting data for the Nolan Gold Project. In April 2008, the QP collected a 414 lb bulk sample of semi-massive stibnite, vein quartz, and wall rock gangue from the defined mineralized ‘A’ Zone in the Workman’s Bench underground workings. The purpose was to determine the mineralogical nature of the antimony mineralization and the source of significant gold values within the ‘A’ Zone.

The 414 lb bulk sample was sent to Hazen Research Labs Inc. in Golden, Colorado, USA in order to discover the most optimal grind for potential marketing of a stibnite product, and to identify the mineralogical nature of the gold and antimony values. Hazen Research Labs Inc. produced two reports in September of 2008. Results of the first report involve flotation and gravity separation of the gold, stibnite and other sulfides and gangue minerals. The results of the second report involve mineralogical examination. Details of the two Hazen Research Lab reports are discussed under Item 2, below.

Silverado has recently acquired a permit from the Bureau of Land Management (BLM) to collect and process a maximum 1,000 cu yd of material from the Workman’s Bench Lode for metallurgical testing. The bulk sample will be collected to determine grinding, flotation, and other processing and mineralogical characteristics of stibnite.

The QP released a detailed technical report on July 29, 2008 referred to as NI 43-101 which disclosed both placer and lode resource estimates for the Nolan Creek properties. Discussion and results of the bulk sample collected by the QP are detailed in the technical report. The July 29, 2008 report was based on information available to the QP as of July 2, 2008, and the resource estimates in the report were superseded by the QP’s November 17, 2008 revised estimates which indicated a resource of 17,000 oz of gold which has been reclassified as a reserve of 17,000 oz of gold following the release of the preliminary feasibility study, effective January 1, 2009. The more recent reserve estimates are discussed in Item 2. The most recent reserve estimates are more complete and accurate since they include data from the completion of the 2008 drill program that ended in late September of 2008. The most recent report,

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effective January 1, 2009 includes a feasibility study by the QP as well as additional drilling data and analysis of core samples. Readers and investors are cautioned that the 43-101 technical report in which the reserve estimates are based upon contains language and terms that may not be recognized by the US Securities and Exchange Commission.

1.4    Nolan Placer Gold Project Exploration

1.4.1    2007 Nolan Placer Gold Exploration

During March and April 2007, placer gold exploration focused on drilling along the left limit of Nolan Creek to explore both north and south of the Mary’s East and Swede Channel deposits. Further placer drilling was carried out within the area between the Mary’s East/Swede Channel Deposits and the Topnotch Prospect. A total of 130 drill holes were completed during that drilling program with a total drill footage of 6,005 feet. Out of the 130 drill holes, 54 show the presence of gold. 3 drill holes showed sample intervals with gold values above the cut-off grade of 0.04 troy ounces per bank cubic yard (toz/BYCD) determined for underground bulk sampling (see table below).

The 2007 placer drilling program discovered an entirely new zone of placer gold which has been named Jack London Bench. Jack London Bench is located 200 feet north-east of and 50 feet above the Mary’s East Bench.

RC drilling is the principal exploration method used by Silverado in the identification of placer gold deposits. All placer drilling in 2007 was performed by a contractor using 6 inch diameter drill rods. Placer drill samples were collected in 5 foot intervals (industry standard).

1.4.2    2008 Nolan Placer Gold Exploration

During 2008, the Company did not do any field exploration work such as reverse circulation (RC) drilling or any other active exploration for placer gold. The Company focused on the Nolan Lode Gold and Antimony Project.

On July 29, 2008, the QP released the NI 43-101 Report ‘Estimation of Lode and Placer Mineral Resources, Nolan Creek, Wiseman B-1 Quadrangle, Koyukuk District, Northern Alaska’, which describes lode and placer mineralization in the Nolan Creek area, including the Workman’s bench area. No new information concerning sampling methods and approach for placer deposits has been generated for Nolan Creek project since that release of information. The results of Bundtzen’s resource estimates differ from the placer gold resource estimates reported by Murton’s 2007 NI 43-101 report for the Company. The difference between the Murton resource estimates and the Bundtzen estimates was due to Bundtzen having access to more data.

1.4.3    Nolan Placer Gold Exploration 2009 Work Plan

Currently the Company is focusing on the Nolan Lode Gold and Antimony Project with an emphasis on infill drilling for more accurate resource estimates in the Workman’s and Pringle Bench Areas.

However, one of the objectives for the year 2009 is to compile all available RC downhole drill data and drill collar survey data from the Nolan Creek drainages and the Slisco Bench on the Hammond River. There has been over 900 percussion drill holes drilled in these areas between 1981 and 2007. A comprehensive GIS based study involving contouring the gold grade in gravels combined with new survey data could indicate potential placer targets that were not considered in previous years. The current placer drill hole database is extensive but incomplete, the consolidation of all the data into a comprehensive GIS database will enable a more accurate analysis of placer gold potential.

Depending on funding and investor interest in the Nolan Lode Gold and Antimony Project, the Company does not plan on any placer drilling exploration in the Nolan Creek drainage during 2009. More infill RC drilling is needed on Jack London Bench and other benches on the left limit of Nolan Creek. All targets for exploration along the left limit of Nolan Creek are well above the elevation of Nolan Creek. The Nolan Creek Deep Channel is a primary consideration for exploration and development, but additional data is needed for hydrologic studies.

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Based on previous RC drill data, the Company believes the best target for placer gold exploration and development is located in the Slisco Bench which is part of our Hammond Property and is discussed below.

Budget projections for this project are detailed under the section “Projected Annual Budget for 2009”

1.5    Nolan Lode Gold and Antimony Project Exploration

1.5.1    2007 Nolan Lode Gold and Antimony Project Exploration Work Summary

During 2007, exploration for a lode gold and antimony deposit on the Company’s Nolan property focused on the Nolan Creek area within the Solomon Shear Zone and the Fortress area. The Solomon Shear Zone is a five mile long gold and antimony bearing shear zone, which is a possible source of placer gold in the Nolan valley drainages, and bench deposits such as Swede Channel, Mary’s East Bench, Mary’s Bench, Eureka Bench, and Workman’s Bench.

The 2007 lode exploration program consisted of extensive ground geochemical soil surveys and ground geophysical very low frequency electromagnetic (“VLF-EM”) surveys, extensive backhoe trenching and a first phase diamond core drilling program to follow up on the significant results achieved by backhoe trenching.

A more detailed description of exploration work during 2007 is as follows:

2007 Nolan Creek Area

In May, June, and July of 2007, the Company undertook an extensive geochemical soil sampling campaign on the lower Smith Creek Dome hillside between Archibald Creek and Smith Creek (the “Hillside”), and south of Smith Creek in the lower western part of Midnight Dome. A total of 695 soil samples were collected during the campaign on a 196.85 x 98.43 foot grid. Assay results of the soil sampling campaign show a distinct arsenic and antimony anomalous trend on the eastern part of the Solomon Shear trend. Arsenic anomalies are strong indicators for the presence of gold.

Along with the soil sampling campaign, Silverado conducted an extensive VLF-EM ground geophysical survey (18.02 line miles) on the lower Smith Creek Dome hillside between Archibald Creek and Smith Creek, and south of Smith Creek in the lower western part of Midnight Dome, to identify structures such as shear zones, faults, and veins that occur within the bedrock. The VLF-EM survey identified structural trends in the Solomon Shear Zone that are overlain by arsenic, antimony, and gold in soil anomalies.

In June, July, and August of 2007 the Company undertook backhoe trenching on Pringle Bench and Workman’s Bench. This program was followed up by a first phase diamond core drilling program. Details of the 2007 exploration program are as follows:

Pringle Bench

Pringle Bench represents an area 500 feet wide by 700 feet long and consists of a series of sub parallel gold bearing antimony-quartz veins.

In 2007, the Company followed up on the results achieved on Pringle Bench in 2006 and excavated six additional trenches, totaling 1296 feet, to further investigate the gold bearing antimony-quartz veins previously identified in 2006. A total of 153 combined continuous chip and select chip rock samples were collected. Continuous chip samples were collected over a defined length along the trench walls and, therefore, are representative for a specific trench interval. Continuous chip samples do contain sample material of mineralized veins if those occur within the sample interval. Select samples were collected from individual quartz and stibnite-quartz veins exposed in the trenches and, therefore, their assays represent the individual veins sampled.

The following table presents significant 2007 trench assay results for Pringle Bench:

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It should be noted that Trench H revealed a 16.4 ft interval (sample number 07H03) with an erratic gold grade. The Company instructed ALS Chemex to re-assay the pulp of the specific sample which confirmed the previous gold value. The Company also decided to re-sample Trench H. Re-sampling did not reproduce the grades of the previous sampling campaign, but confirmed the presence of gold and antimony mineralization. The stibnite-quartz veins in the Nolan area are known to contain coarse gold which can result in a “nugget effect” when assayed.

Following up on the encouraging results achieved by backhoe trenching, the Company started a first phase drilling program at Pringle Bench at the end of August 2007 using its own diamond core drill rig. Eleven drill holes were drilled on Pringle Bench totaling 2,415 feet. The core drilling program was designed to check for down-dip continuity of the gold bearing antimony-quartz vein systems in the zones identified thus far. The core drilling confirmed the presence of stibnite (antimony) and quartz veins at varying depths.

2007 Workman’s Bench

Workman’s Bench is located near the confluence of Smith and Nolan Creek.

In July 2007, the Company excavated one trench in the old Workman’s Bench pit with a total length of 125 feet. This trench exposed the largest antimony veins discovered in the Nolan Creek area to that date. A total of 15 continuous chip samples were collected from Trench J.

The following table presents significant 2007 trench assay results for Workman’s Bench:

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A first phase exploration drilling program on Workman’s Bench using the Company’s own diamond core drill rig started at the end of August 2007 and ended on October 23, 2007 due to weather conditions. Seven drill holes were drilled totaling 2,140 feet. This drilling program was designed to check for down-dip continuity of the gold bearing antimony-quartz veins previously discovered. Visual observation of the drill core had identified the presence of many antimony-quartz and quartz veins. The majority of these veins were found to be contained in an 80 foot wide zone.

On November 16, 2007, we began excavation of the portal that would continue into the bedrock below Workman’s Bench located on the south side of Smith Creek near the confluence with Nolan Creek. The tunneling effort continued into 2008 and resulted in 570 feet of underground workings consisting of four interconnected tunnels referred to as Crosscut Tunnels A, B, C and D.

The QP collected a 414 lb bulk sample from mineralized zone ‘A’ for metallurgical test work from the underground workings in April 2008. The underground exposure of the mineralized zone will play an important key role for the Company in obtaining a better understanding of the nature of the structurally controlled gold and antimony mineralization in the Solomon Shear Zone. This will significantly support Silverado’s exploration strategy.

2007 Fortress Area

The Fortress area is located two miles northeast of Nolan camp and north of Smith Creek Dome. This area exposes several outcropping northwest striking quartz veins, some of which contain significant gold mineralization. The Company investigated the Fortress area in late summer 2007 and collected several quartz vein samples and confirmed anomalous gold concentrations in vein samples.

Based on the encouraging results, the Company conducted a VLF-EM ground geophysical survey (9.33 line miles) along with a ground geochemical soil survey over the central part of the Fortress area. A total of 290 soil samples were collected on a regular grid during the campaign. Interpretation of the VLF-EM survey data by the Company revealed two east-west trending fault zones that are overlain by arsenic and gold in soil anomalies. A combination of soil survey results, ground geophysical data, and surface geology suggest to Silverado that formation of northwest-trending gold-bearing quartz veins may be controlled by east-trending deformational zones.

The VLF-EM ground geophysical survey along with the ground geochemical soil survey conducted in the Fortress area, confirmed the presence of the gold-bearing antimony quartz vein system on the Saddle, as part of the Solomon Shear trend, in the southern part of the Fortress area. Interpretation of the VLF-EM survey data by the Company revealed two northeast trending deformation zones of which the southern deformation zone is overlain by antimony and arsenic in soil anomalies.

1.5.2    2008 Nolan Lode Gold and Antimony Project Exploration Work Summary

During 2008, exploration for a lode gold and antimony deposit on the Company’s Nolan property focused again on the Nolan Creek area within the Solomon Shear Zone and Fortress area. The Solomon Shear Zone is a five mile long gold and antimony bearing shear zone, which is a possible source of placer gold in the Nolan valley drainages, especially the gravel bench deposits such as Swede Channel, Mary’s East Bench, Mary’s Bench, Eureka Bench, and Workman’s and Pringle Bench. The Fortress area is a broad ridge located on the north end of the property between the Hammond River drainage and the Nolan Creek drainage. The Fortress area hosts gold-quartz-arsenopyrite veins which are associated with east-west structures termed by the Company as the Fortress trend. The Fortress veins may be the source for the gold in the Thompson Pup placer deposits. The southern end of the Fortress area is cut by the Solomon Shear Zone and contains gold and antimony mineralized quartz veins distinctly different from the Fortress trend veins.

The 2008 lode exploration program consisted of a variety of field exploration work. During early February 2008, 570 lineal ft of underground tunnels, termed Tunnels A, B, C and D were completed in the bedrock below the Workman’s Bench, crosscutting the gold and antimony veins associated with the Solomon Shear Zone. Channel samples of the bedrock were collected from the newly excavated tunnels during the winter of 2008. During April of 2008, the QP collected a 414 lb bulk sample of the gold and stibnite-rich main vein, referred to by the Company as the Zone A vein. During the early summer of 2008, additional ground geophysical very low frequency electromagnetic (VLF-EM) surveys were conducted in the Fortress area. Approximately 79,000 ft (14.9 miles) of geophysical lines were surveyed in the former area. No soil samples were collected on any of the Nolan Gold Properties. Fourteen rock samples were collected throughout the Nolan Gold Project properties.

Additional diamond core drilling continued in the summer of 2008, but focused exclusively on the Solomon Shear Zone on the south side of Smith Creek. Thirty four drill holes were drilled into the gold-bearing antimony-quartz veined zone underlying Workman’s Bench and the southwest continuation of the zone. A total of 11,597 ft was drilled into the Solomon Shear Zone. Freezing temperatures disallowed the continuation of drilling in late September while the Company was trying to drill on the north side of Smith Creek between the Pringle Bench and Workman’s Bench areas.

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In addition, in June of 2008, three vertical RC holes (water test wells) were drilled a minimum of 300 ft each to test for the presence of groundwater in the area around Workman’s Bench. The well holes were drilled outside the limits of the mineralized Solomon Shear Zone, yet were proximal to the zone. According to Swan Drilling of Fairbanks Alaska, no groundwater water was encountered in any of the RC drill holes. A total of 1,000 ft was drilled by Swan Drilling. The rock chips were collected every five feet and visually inspected by geologists for possible mineralization.

A more detailed description of exploration work during 2008 is as follows:

2008 Nolan Creek Area

2008 Workman’s Bench

Workman’s Bench is located near the confluence of Smith and Nolan Creek.

On November 16, 2007, we began the excavation of the Workman’s Bench Portal and continued excavating 570 feet of underground workings into the bedrock below Workman’s Bench. The tunnels were finished on February 2, 2008. The tunnels are interconnected and serve a multitude of purposes. The first purpose was for determining the overall width of the veined gold and antimony mineralized zone and establishing the strike and dip of the individual quartz-gold-antimony veins. The second purpose was for the collection of insitu bedrock channel samples for geochemical assays, and the third purpose was for the collection of significantly larger (bulk) samples of the main gold and antimony vein referred to by the Company as the ‘A’ Zone vein. The A zone vein typically consists of massive stibnite and gold with variable quartz and carbonate gangue minerals. The underground workings were mapped to determine the true strike and dip of the veins as well as the true width of the veins and mineralized zones. The QP collected a 414 lb bulk sample of the ‘A’ Zone Vein for more accurate geochemical assays as well as for preliminary milling and processing studies of the gold and antimony. The 414 lb sample of mostly massive stibnite with minor quartz and carbonate gangue was sent to Hazen Research Inc. Lakewood, Colorado, for the metallurgical tests. The underground tunnels will also be used for additional geotechnical studies and most importantly for access and egress of future bulk sampling efforts at depth.

During February of 2008, the Company collected 92 channel samples from the rock walls of the tunnels, and collected specific samples of the larger quartz-stibnite-gold veins. The channel samples were five feet in length. In addition, the QP collected 23 independent channel samples across 16 northeast striking steeply dipping quart-stibnite-gold veins, as well as 7 other less mineralized structures.

The following table presents assay values of significant 2008 underground channel samples and specific semi-massive and massive stibnite vein samples collected during February of 2008. The following table shows the slightly variable gold content within the stibnite rich areas, even when sampled from similar sites. The variable gold content in the massive stibnite, and stibnite-rich zones, supports the Company’s previous interpretation that there is a gold ‘nugget effect’ that makes the estimation of a lode gold to antimony ratio difficult to ascertain and is part of the reason why the Company is seeking a bulk sample on the scale of 1,000 to 2000 cubic yards or more. Also, further metallurgical work and processing studies will be carried out on a wider range of ore grade material. Refer to plan view map of the underground workings for the sample locations.

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A total of 34 diamond core drill holes were drilled into the gold-bearing antimony-quartz veined Solomon Shear Zone in 2008, totaling 11,597 ft of core for the season, with a core recovery of over 95%. The second phase drilling effort was focused exclusively on the portion of the Solomon Shear Zone that extends 1300 ft southwest from Smith Creek across Workman’s Bench. Details of the results of the drilling program are discussed below.

During the 2008 drilling program, a total of 627 samples were collected from the drill core. The total samples collected is significantly less than the 1,195 core samples collected during the 2007 drill program even though the drilling footage in 2007 totaled only 4,555 ft. The fewer samples collected was based off of results of 2007 when the holes were sampled from top to bottom. Drill results in both the Pringle and Workman’s Benches in 2007 indicated that the gold mineralization was associated with the sulfide-bearing (stibnite or arsenopyrite) quartz veins. Thus, only individual quartz veins or zones of closely spaced thin veins were sampled, and these samples are referred to as specific samples. The adjoining wall rock of significant veined zones was also sampled, and these are referred to as reference samples for continuity across the zones.

Four discrete gold-bearing stibnite-quartz-carbonate veined zones, were defined by the results of the two drilling programs, and these four zones are also evident in the workman’s Bench Underground exploration tunnels. The four zones are depicted in the Fig below. Currently, the ‘A’ Zone vein is the largest in width and most well defined in our downhole projections and in the exploration tunnels. The ‘A’ zone vein was subject for the bulk sample collected by the QP in April of 2008. Results of the bulk sample are listed in Bundtzen’s 43-101 report. The resource estimates for the deposit exclude the ‘C’ Zone.

The map below is a plan-view of the 570 ft of underground workings and depicts three of the four mineralized zones. The ‘West’ zone which typically skirts the west side of the ‘A’ Zone is not outlined in the figure.

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Location of underground development and channel samples, Workman’s Bench

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Surface view of Workman’s bench mineralized zones, showing locations of underground workings, drill hole control, and interpreted extensions and overall widths of A, B, C and West Zones.

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The following table shows examples of the types of mineralized veins in the four discrete zones within the Solomon Shear Zone. Some of the smaller veins are examples of individual veins and do not represent the entire zone which may contain more veins within it. The reserve estimates discussed in Item 2 are based off of the ‘A’,’B’, and West Zones and do not include the ‘C’ Zone. The table does not show all of the intercepts used by the Company for reserve estimates. The table is for description purposes only.

Table of selected sample composites , illustrating composited assay information and true widths of mineralized structures and veins from 2008 Workman’s Bench core drilling program.

Independent Preliminary Feasibility Study Completed by Pacific Rim Geological Consulting Inc.

During September 2008, Thomas K. Bundtzen of Pacific Rim Geological Consulting Inc. (the “QP”) was commissioned by the Company to perform a preliminary feasibility study of the Workman’s Bench Antimony and Gold Lode Deposit. Bundtzen is a third party (independent) and AIPG Certified Professional Geologist. Bundtzen is a “Qualified Person” as defined by NI 43-101 and also qualifies under the rules of the U.S. Securities and Exchange Commission. The significance of the preliminary feasibility study is that the resource estimates of the lode antimony and gold have been reclassified as a reserve and the deposit is an economically viable deposit.

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The information in the report was based on data as of October 15, 2008. The report was prepared as a National Instrument 43-101 Technical Report in accordance with Form 43-101F, for the Company. Readers and investors need to take caution since the 43-101 technical report is under the guidelines of the British Columbia Securities Commission and that the United States Securities Exchange Commission does not recognize many of the terms used such as “indicated resources” and “inferred resources” and possibly other terms which are commonly used by the Canadian Institute of Mining (CIM). Readers should note that the results of the study post date the previous report by the QP released on July 29, 2008, and that the information in the recent report which includes resource estimates supersedes the July report. The results of the study were released on January 1, 2009. The report in its entirety can be found at our website www.silverado.com. Some of the pertinent items discussed in the report are as follows:

Data Verification

During numerous personal inspections of the Nolan Creek properties during both 2007 and 2008, the QP observed sample collection and sample preparation practices for the Nolan Gold Projects lode-style deposits. On June 13 and 14 and September 28 and 29, 2008, the QP visited the Nolan Camp and examined all significantly mineralized core intervals acquired from the 2007 and 2008 drilling programs. A total of 124 mineralized intervals were examined. The analytical data was compared with each of the mineralized zones and confirmed the elevated antimony and gold values in the sampled areas.

The QP observed core logging and trench samples being prepared for shipment from Nolan Creek during October 22 to October 23, 2007. The QP also observed Silverado contractors preparing placer samples for separation of placer gold, the subsequent weighing of recovered gold and calculation of gold per unit volume of material.

Judgments and determinations by the QP in regards to the Company’s sample preparation, analytical procedures and security of samples are discussed in the 43-101 technical report.

Nolan Lode Gold and Antimony Project 2009 Work Plan

The recent feasibility study performed by the QP will be a guideline for our future activities. Depending on funding and the acquisition of certain permits, the Company plans to fast track efforts toward the development stage.

During 2009, lode exploration work will consist of additional diamond core drilling in several key areas throughout the property, as well as more test trenching and bedrock sampling along the northeast trending Solomon Shear Zone. The primary focus will be infill drilling in the intermediate area between the Pringle Bench and Workman’s Bench, as well as more infill drilling within the area drilled in 2008 for more accurate resource estimates of the gold and antimony mineralized veins. Additional drilling on the property will be dependent on our completion of drilling in the former key areas. The planned drilling schedule is as follows.

Workman’s Bench - The Company plans to infill drill a minimum of 20 holes along the portion of Solomon Shear Zone that was drilled in 2008, for a more accurate estimate of reserves.

Pringle South – The Company plans to infill drill a minimum of 10 holes along the Solomon Shear Zone on the north side of Smith Creek in the area between the Pringle and Workman’s Benches for a check of the continuity of the northeast striking zone.

Hillside Area - The bedrock underlying the Hillside Area was drilled in previous years with an RC drill, but the drilling locations were based on only bedrock trenching data. Since then, geophysical surveys and geochemical soil sampling surveys have indicated that drill collars were too far west and the Company plans to drill a minimum of 5 holes approximately 800 feet further to the east and drilling back toward the west to intercept the zone. In 2009, the Company plans to take advantage of the historic trails and use an excavator to dig additional test trenches in the area further to the east.

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Medina’s Sleeping Giant - The Company’s newest prospect, based on air photo interpretation and airborne EM surveys, is another structural zone that is over three miles in length and parallels the Solomon Shear Zone. Located approximately 2,000 ft east of the Solomon Shear Zone, the zone cuts across Smith Creek in an area defined by two closely spaced ephemeral creeks (gullies), an area where “old timers” previously mined stibnite. The Company believes that this is likely another structural zone similar to the Solomon Shear Zone. The northeast striking zone extends northeast from Smith Creek along the break in slope directly south of Smith Dome.

The escarpment that remains at the base of the slope represents the highest erosion and movement by glaciers in the area, and this area may be responsible for the historic placer deposits in upper Smith Creek. The Company plans to excavate a minimum of four 100 ft test trenches into the overburden as well as the bedrock to check for gold and antimony mineralization. The test trenches are essential since there is no bedrock exposure, and the tundra covered soil horizons are poorly defined or absent.

Fortress Area - The Company plans to do detailed mapping and sampling of the quartz-arsenopyrite veins in various outcrops along the Fortress ridgetop. No drilling is planned for the Fortress Area in 2009.

Sample Collection, Sample Preparation, and Analytical Procedures

All primary sample preparation from both lode and placer mineral exploration programs at Nolan Creek was conducted by professional geologists employed by Silverado. All work completed on behalf of Silverado was completed by or under the supervision of a contractor of Silverado. Officers, directors, and associates of Silverado were not involved in sample preparation. Independent, off-site analytical laboratories completed additional sample preparation of samples from the lode-style deposits.

Analysis of placer samples is performed on-site by Silverado contractors. Analysis of lode-style deposit samples (core, percussion, trench, and underground channel) is performed by independent, off-site laboratories.

Samples from placer deposits are analyzed in their entirety (i.e., no sub-sampling) to minimize potential bias from sub-sampling of material with such a large proportion of gold nuggets. The primary sample is processed through a gravity separation technique at the drill rig to separate gold nugget, fine gold, and heavy minerals from the host gangue material. A systematic procedure was developed by geological staff for the collection and preparation of percussion drill hole samples. The sample is emitted from the drill and immediately submitted to a drill-mounted cyclone to dissipate the sample velocity, and then passed through a Jones™ splitter. The split sample is then processed through a Denver Gold Saver™. The oversize exits the revolving drum screen to a picking plate where +¼ inch nuggets are hand-picked. The – ¼ inch undersize reports to a Teflon lateral action sluice and the resultant heavy mineral concentrate is hand-panned. The gold in the concentrate is then picked with tweezers. The remaining fine heavy concentrate is treated with amalgamation and the resultant gold bead is weighed along with the hand-picked gold with a Champ™ electronic balance.

The Company judges that the combined weight of the hand-picked gold and the fine gold represents most of the gold in the sampled interval. Since there will always be some loss of gold during this analytical procedure, the gold grade in the sample is not likely to be overstated.

Silverado conducted volume measurements of samples collected during 2003 and 2004 drilling programs. Results of these measurements showed that a 5 foot sample from the Nolan Deep Channel averaged 14.80 gallons, whereas a 5 foot sample from the Mary’s East Bench deposit averaged 19.20 gallons. The Nolan Deep Channel deposits contain significant amounts of silt, sand, and clay, whereas the left limit bench deposits such as those at Mary’s East are much coarser grained. Determination of volumetric measurements results in a more accurate estimate of gold grade in the placer deposit. Hence, each placer deposit has been volume-characterized by Silverado contractors during exploration.

Sample grades for placer deposits are expressed as gold content per bank volume of material where bank volume is the in situ volume of material. To calculate the bank volume the sample volume must be factored using a predefined swell factor that quantifies how much the volume of the sample increases as a result of extraction. The weight of the gold extracted from the sample (the method of recovery which was described previously) is divided by the bank volume of the sample to determine the grade of the sample expressed in oz/cu yd Au.

Two methods are traditionally used by Silverado to estimate gold grades in a placer resource. One method is to calculate the amount of gold present in a bank cubic yard or ounces gold/cubic yard. When all of the values are on or near the bedrock-gravel interface, an alternative method of estimating gold quantities in a placer deposit is the amount of gold present on one square foot of surface area on bedrock, known as a bedrock square foot or ‘bsf’. Since most of the placer gold in the Nolan Deep Channel and in left limit benches are ‘bedrock placers’, some Silverado geologists have expressed gold values in exploration drill programs in ‘bsf’. This value varies with the thickness of auriferous materials both above and below the bedrock-gravel interface. Silverado has established conversion factors for converting ounces gold/bsf to ounces gold/cubic yard, which systematically varied from valley floor and bench deposits.

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All drill hole grade data is expressed in ounces gold per cubic yard. Sample recovery calculations have been implemented by Silverado geological staff.

The bsf method was used by the “old time miners” on the property as the steep bedrock terrain created extreme variables in vertical pay sections laying on bedrock, varying from one to fifteen feet thick. Therefore, cubic yard measurements could be misleading in estimating and measuring a deposit. Measuring deposits in valley bottoms or large bench areas allowed accurate calculations for those areas using the volumetric (i.e., bcy) method.

Diamond core samples are split in half on-site by Silverado personnel using a core saw. Half of the core is submitted to external laboratories for analysis and half is retained on site. Samples from RC drilling are split with a splitter and surface samples are split by contracted laboratory personnel.

ALS Chemex of Vancouver, Canada, an ISO 9001:2000 accredited laboratory, has analyzed most of the Silverado sample stream from lode-style deposits. More recently, Alaska Assay Laboratories LLC of Fairbanks, Alaska, an ANS/ISO/IEC Standard 17035:2005 accredited laboratory, has been used by Silverado for analytical work. Both laboratories produce a coarse split from which a finely ground material to 150 mesh is analyzed. The pulverized material and the coarse reject are stored by the laboratories for possible re-analysis.

Trench and drill core samples submitted to ALS Chemex are analyzed by the following methods: ME-MS41 (41 multi element), Au-AA23 (fire assay gold to 5 ppb level), and Sb-AA65 (> 1% antimony or referred to as ‘ore grade’ antimony). Soil samples shipped to ALS Chemex are analyzed for the same packages with the exception of the ore grade antimony or Sb-AA65.

Samples submitted to Alaska Assay Laboratories LLC were analyzed using the following methods: Au-30 element (multi-element), fire assay AA for gold and silver, and ICP-4A (ore-grade antimony). The packages from each laboratory are roughly comparable in both elemental suite and analytical methods.

Quality Control and Quality Assurance

Quality control and quality assurance (QC/QA) is routinely performed by Silverado exploration contractors. Standards have been obtained from Shea Clark Smith, a geochemist based in Tucson, Arizona that supplies standards for mining companies. For core intervals intersecting vein zones, two standards and one blank are randomly inserted in batches of twenty (20) sample intervals. One standard contains 0.174 oz/ton gold. The other standard contains 0.261 oz/ton gold. For core penetrating mainly wall rock zones, one standard and one blank are randomly inserted into batches of twenty (20) samples, with the standard used containing 0.174 oz/ton gold.

Core recovery is checked in every box coming off the drill rig. During 2008, Silverado's geological contractors have reported that core recovery averaged 95% since the exploration drilling switched to NQ core. Silverado contractors have competently prepared samples analysis and dispatch to external laboratories. All drill core is digitally photographed on site, and the photos are kept on file for future reference as needed. All photos from the 2007 and 2008 drill programs were submitted to the QP for additional verification.

Sample security is maintained by geological contractors. Samples are stored in a secure trailer at Nolan Camp. Individual samples are composited into larger rice bags and sealed with wire ties. Samples are then transported by contractors to the ALS Chemex preparation laboratory in Fairbanks, Alaska.

The analytical package selected from external assay laboratories reflects the need to: obtain precise antimony and gold values, obtain information on trace metals such as bismuth, lead, arsenic, cadmium, and selenium, and to seek to understand background levels of other elements for environmental monitoring reasons. Because Silverado is evaluating the lode resources of the area for potential development, it is useful for Silverado to take a broad look at the elemental suite present in the affected environment in order to better design an environmental monitoring program. Data from Workman’s Bench shows Ca values as high as 17.50 percent. This may indicate a high CaCO3 content of some sample intervals. Recent (2008) core logging criteria requires the geologist to do a cold diluted HCL acid test of the drill core while logging the core as a field test of the carbonate (buffering potential ) content of the bedrock. The rock encountered in the zones of interest have elevated sulfide contents that could pose an acid drainage problem during future mining operations. The Company tracks both the sulfide content and the carbonate content for acid-base accounting purposes.

In addition, marketability issues are being addressed. Some metals are considered to be deleterious in antimony purchases. For example, most antimony smelters will not accept material that exceeds 0.5% combined lead and arsenic. Smaller amounts of selenium and bismuth also pose potential limitations and may invoke smelter penalties. Hence a broader suite of elemental information has been acquired during the exploration of what is basically an antimony-gold-arsenic system.

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Mineralogical Processing and Metallurgical Testing Results of the 414 lb Bulk Sample.

Until very recently, Silverado had not completed mineral processing or processing tests of lode mineralization in the Nolan Creek area. Silverado has acquired a permit from the USBLM to collect and process a maximum 1,000 cu yd of material from the Workman’s Bench lode for metallurgical testing. The bulk sample will be collected for a more accurate determination of grinding, flotation, and other processing and mineralogical characteristics of the stibnite. The bulk sample will also determine the mineralogical nature of the gold and help determine the Company’s recent conclusions that there is a gold ‘nugget effect’ associated with the stibnite veins, and the larger bulk samples will serve to better ascertain a more accurate gold to antimony ratio for the Workman’s Bench deposit.

In April 2008, the QP collected a 414 lb bulk sample of semi-massive to massive stibnite, vein quartz, and wall rock gangue all from the defined mineralized ‘A’ Zone in the Workman’s Bench underground workings . The purpose was to determine the mineralogical nature of the antimony mineralization and the source of significant gold values. There is much variation in gold content of the stibnite zones even within constrained sample collection areas. The bulk sample was sent to Hazen Research Labs Inc. (Hazen) in Golden, Colorado, USA in order to discover the most optimal grind for potential marketing of a stibnite product, identify the mineralogical nature of gold and antimony values in the mineralization.

Two reports were produced by Hazen in September: 1) Report #1 - Flotation and Gravity Results, Workman’s Bench Stibnite-Gold Deposit, Wiseman District, Alaska; and 2) Report #2 - Mineralogical Examination, Workman’s Bench Stibnite-Gold Deposit, Wiseman District.

Summary of Hazen’s Report #1 - Rod mill grinding followed by two rougher stages yielded a gold recovery of 98% and an antimony recovery of nearly 100% in 37.8 percent of the weight, which strongly indicates flotation may be a viable process for recovering gold and antimony at Workman’s Bench. The gold and antimony grades from the sample were 0.546oz/ton (as stated, 18.7 g/t) and 36.7 percent respectively, which compare fairly closely to the average inferred resource grades of 39.13 % antimony and 0.395 oz/ton gold from ‘A’ Zone. Gravity separation using a quarter DeisterTM shaking table produced a second, cleaner gold and arsenopyrite concentrate that assayed 9.4 oz/ton (356.0 g/t) gold . This test work indicates that coarse gold and coarse stibnite can likely be recovered by gravity separation; however, fine grained components of both mineralogical products may require flotation. Given the tendency for stibnite to ‘slime’, a flotation circuit may be an important prerequisite for a recovery system. Using gravity only methods would result in a stibnite recovery of approximately 85 percent, and gold recovery of about 90 percent. No duplicate flotation and gravity confirmation tests were completed by Hazen Research Labs Inc.

Summary of Hazen’s Report #2 – The second report involved a different separation process that included a heavy liquid with a specific gravity of 2.96 (acetylene tetrabromide) for separation of the heavy minerals for statistical analysis and to determine the nature of the gold occurrence. The heavy liquid sink produced 85% stibnite, 10% gangue, 3% pyrite, 2% arsenopyrite, 1 % Rutile, and native gold.

Further metallurgical testing may prove that acceptable gold and antimony recoveries from slimes may be obtained through the side of the high centrifugal force effect provided by a Falcon Concentrator. If this proves to be the case, then the more costly flotation process may be avoided.

Budget projections for this project are detailed under the section “Projected Annual Budget for” 2009.

We are a mineral exploration company with interests in properties located throughout the state of Alaska. The majority of such properties are in the early stages of exploration, and there is no assurance that a commercially viable mineral deposit exists on all of such properties. Effective January 1, 2009, based on completion of a preliminary feasibility study, our Nolan Gold and Antimony Lode Project has disclosed an economically viable mineral reserve. The preliminary feasibility study concluded that the resource estimates disclosed by the Company in its Current Report on Form 8-K on November 17, 2008 can be reclassified as a probable reserve. Though there were no material changes to the grades and quantities previously reported on November 17, 2008, there was additional data produced that added new grades and there was further work conducted on this zone that resulted in the aforementioned reclassification.

2.    Ester Dome Property

2.1    Ester Dome Property 2008 Work

The properties comprising our Ester Dome gold project are discussed in detail under the heading Description of Properties herein. In recent years, all exploration trenches were backfilled, stabilized, and seeded to resist surface erosion. Annual assessment work for

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2008 was completed and all claim rental payments were made to maintain the property in good standing. Fairbanks North Star Borough 2008 taxes were paid on the mill facility and mine facilities in the sum of $7,950.30.

2.2    Ester Dome Property 2009 Work Plan

During 2009, we plan to continue work toward completion of the closure of the Grant Mill Tailings Pond, as part of our asset retirement obligations. This pond, which is filled to capacity with tailings, will be capped and decommissioned after a final approval of the tailings pond closure plan is received from the Alaska Department of Environmental Conservation (“ADEC”). Currently the Company is waiting on a report from Shannon and Wilson Inc., an engineering and environmental firm that is in the process of completing a study that is needed for the Company to move to the next phase of required permitting needed before the decommission process can take place. The Company remains in good standing with the state regulators and will continue reclamation work on our Ester Dome holdings during 2009.

Several large-scale projects have been proposed over the past ten years, but shelved either as a result of poor market conditions or due to internal decisions to favor shifting financial and manpower resources to the Nolan Project. One project that remains under consideration is environmentally friendly bio-degradable urea heap leaching of crushed and agglomerated gold ore after coarse gold has been recovered from the crushed ore by conventional gravity and water methods. A second project that continues under study involves mining of the O'Dea structure by underground methods. All past mining stopped at the 200 foot level of the workings, which is just above the water table. Close spaced diamond drilling between the 200 foot and 1,000 foot levels prove the existence of several significant high grade ore shoots within the O’Dea breccia zone.

3.    Hammond Property

3.1    Hammond Property 2008 Work

The placer claims comprising our Hammond property are discussed in detail under the heading Description of Properties in this annual report. During 2008, rental payments were made to keep the mining claims in good standing.

3.2    Hammond Property 2009 Work Plan

To date, the Nolan Creek Deep Channel placer deposit and the Hammond River Slisco Channel have the greatest exploration potential for an economically viable placer deposit. Both prospects require more RC drilling and analysis.

RC placer drilling in 1995 and 2006 identified a channel containing placer gold that extends for a length of over 1,800 feet. The channel, named the Slisco Channel, remains open to the southeast and there is evidence of one or more tributary channels that remain to be explored in the near future. Within the Slisco Channel, the placer gold occurs on bedrock and on a second horizon about 20 feet above the bedrock channel.

The higher placer gold values in both pay layers are located within the left limit of the Slisco Channel. In addition to the encouraging drill results to date, the potential of extending the channel to the southeast plus the possibility of discovering gold bearing tributary channels, make this a prospect for additional discoveries. During the summer of 2009, a series of drill holes will be completed to explore for the extension of the Slisco Channel to the south. Presently, it has been traced for 1,800 feet. The drill program will also seek to define any gold bearing tributaries to the Slisco Channel.

This project may require the Company to secure additional funding. Even if funding is acquired, there is no guarantee that a commercial gold bearing placer deposit will be developed. Even if a gold bearing deposit is developed, additional funding will be required to mine the deposit, and until a feasibility study is completed, there is no guarantee that the deposit will be profitable to mine.

4.     Eagle Creek Property

The properties comprising our Eagle Creek property are discussed in detail under the heading Description of Properties in this annual report. During 2008, annual assessment work was completed on the property, and rental payments were made to keep the mining claims in good standing.

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4.1    Eagle Creek Property 2009 Work Plan

During 2009, annual assessment work will be completed on the property to keep the mining claims in good standing. Assessment work will be focused on the northwest part of the claim block, where drilling and trenching has defined an intrusive host rock, thought to be a sill, containing low grade gold, silver and antimony mineralization. If funding permits, the Company will design a trenching and drilling program to further investigate the gold and byproduct mineral distribution of the intrusive. Additional work which includes trenching and drilling will also be completed on the Number One Vein. The Number One Vein was the lode quartz gold structure which has been mined commercially for antimony. The drilling will be performed by a drill contractor.

Completing the 2009 work plan will be contingent on available funding. Even if funding becomes available, there is no assurance that a commercial gold-silver-antimony deposit will be defined.

2009 Exploration Budget

Projected Annual Budget for Fiscal Year 2009

Nolan Gold Project

Completion of all of the projects described in the 2009 work plan will be contingent on additional funding. There is no assurance that additional funding will be obtained. Even if the additional funding is obtained, there is no assurance that a commercial ore deposit will be developed. Revenues from any anticipated gold and antimony sales are projected to be profitable.

LOW-RANK COAL-WATER FUEL BUSINESS

We commenced development of a low-rank coal-water fuel business in 2000. Our determination to enter into this business was based on a decision to broaden our business beyond mineral exploration and production. This aspect of our business is still in the start-up phase of operations and no revenues have been achieved to date. We do not anticipate that revenues from this technology will be achieved until commercialization of the technology has been established.

We entered the fuel sector in 2000 by forming a new Fuel Technology division which operates out of Fairbanks, Alaska. This division of the business is operated by our wholly owned subsidiary, Silverado Green Fuel Inc., under the supervision of Dr. Warrack Willson, Vice-President of Fuel Technology. The fuel product is called low-rank coal-water fuel (LRCWF or Green Fuel), which is a low-cost, non-toxic, non-hazardous alternative to oil fuels used in commercial boilers for the production of electricity and industrial heat. As a liquid fuel Green Fuel enjoys all the benefits of liquid handling and storage, Green Fuel allows coal to be used sight unseen and is made from coal, America’s most abundant fossil energy resource. This fuel is produced by the fine grinding of low-rank coal, and subsequent hydrothermal treatment of the finely ground coal particles. Hydrothermal treatment (HT) is an advanced technology, featuring moderate temperature/pressure, non-evaporative treatment or hot water drying, which irreversibly removes most of the inherent moisture from low-rank coal and allows the formulation of commercially viable LRCWFs. HT is similar in many respects to pressure cooking, and the product retains all of the desirable combustion characteristics of low-rank coal. When Green Fuel is injected into a boiler, the particles ignite and burn rapidly, which leads to little or no boiler de-rating when substituted for oil. We believe that demand for the Green Fuel and its production and utilization technology exists because of the high cost of oil and the desire for economical alternatives to oil that are environmentally friendly.

On December 18, 2006, Silverado Green Fuel Inc. announced the signing of a Memorandum of Understanding (“MOU”) between Choctaw County, the Choctaw County Economic Development District (“CCEDD”), the Mississippi Development Authority (“MDA”) and Silverado Green Fuel Inc. The MOU is an agreement to build the country’s first Low-Rank Coal-Water fuel commercial demonstration plant at the Red Hills Ecoplex just outside of Ackerman, MS. Considering the inability to receive a Federal fund appropriation over a seven year period as no energy bill was passed, the Company suggested that CCEDD and MDA retain their

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grants and not reconsider them until such time as complete funding for the project could be obtained. Both CCEDD and MDA agreed and dissolved the MOU and related grants pending senior project financing.

Silverado is currently having a $150,000 study conducted on the chemical and physical characteristics of Mississippi Red Hills Lignite Coal at the Mineral Industry Research Laboratory at the University of Alaska (Fairbanks) and expects results by late 2009.

Results of the tests as well as capital availability and an increase in oil prices would all have to be positive for Silverado Green Fuel Inc. to reconsider construction of its LRCWF project. In the meantime, Dr. Warrack Willson, at age 65, has retired from Silverado Green Fuel and the Company retains its rights under its agreement with Dr. Willson to the LRCWF technology and exclusive rights to technology developed by Dr. Willson during his employment with Silverado.

GOVERNMENT REGULATION

Silverado and its subsidiaries collectively own (or partially own), lease, and/or hold purchase options on numerous federal and state placer and lode mining claims on the Nolan, Slisco, Eagle, and Ester properties, all of which are located in Alaska. These 801 total claims consist of: (i) 672 federal mining claims, comprised of 228 federal placer claims and 444 federal lode claims, and (ii) 129 state mining claims (the state of Alaska does not distinguish between placer and lode rights within each state mining claim).

The Company’s interests with respect to each specific property are currently as follows:

• Nolan - Silverado is the sole owner of 204 federal placer mining claims and 407 federal lode mining claims.

• Hammond (Slisco) – Silverado leases 24 federal placer mining claims and 36 federal lode mining claims from Alaska Mining Company, Inc.(ALMINCO)

• Eagle – Silverado has an equal (50%) ownership interest in 77 state mining claims with Kathleen King.

• Ester – Silverado is party to an agreement for the conditional purchase of 22 state mining claims from Paul I. Barelka, Donald J. May, and Mark Thoennes; Silverado leases 1 federal lode mining claim and 4 state mining claims from Gilbert Dobbs; and Silverado is party to an agreement for the conditional purchase of 26 state mining claims from Roger C. Burggraf.

The following is a brief description, in accordance with paragraph (b)(2) of Industry Guide 7, of the title, claim, lease, and/or option instruments under which Silverado and its subsidiaries have or will have the right to hold or operate its properties, the conditions which must be met in order to obtain or retain such properties, and the expiration dates of any leases or options, as well as certain other material terms:

i.      Lease Of Mining Claims With Option To Purchase - The Hammond (Slisco) Property

Pursuant to that certain Lease Of Mining Claims With Option To Purchase, effective December 14, 1994, as amended on July 5, 1996 and on August 21, 1996 (the “Lease”), Silverado leased certain unpatented placer mining claims and lode mining claims recorded in Fairbanks, Alaska (collectively, “Claims”), and obtained an option to purchase such Claims, from Alaska Mining Company, Inc. (“ALMINCO”).

The Lease had an initial term of five years, but has been extended on a year-to-year basis on the same terms and will be in good standing for as long as the covenants in the Lease remain satisfied.

Silverado materially covenanted to (i) perform certain work and make certain expenditures on the Claims; (ii) obtain all licenses, permits, and bonds required by law; (iii) timely complete all required annual assessment work required for the Claims; (iv) pay the rents due to the United States on the Claims each year; (v) maintain adequate workers compensation insurance; (vi) indemnify ALMINCO for all losses and injuries not due to its own negligence; (vii) carry public liability insurance of at least $500,000 and name ALMINCO as an additional insured; (viii) indemnify ALMINCO for any liabilities or fines assessed by local, state, or federal governmental agencies that result from Silverado’s operations, actions, or omissions; (ix) refrain from pledging the Lease as security for any debt or to allow any liens to remain effective against the Lease or the Claims; and (x) refrain from assigning the Lease for the benefit of creditors or to seek protection from creditors under applicable bankruptcy laws.

The Lease obliges Silverado to make royalty payments equal to 10% of gross production from certain of the Claims each year, as well as minimum royalty payments of $20,000 on the first anniversary of the Lease, $40,000 on the second anniversary, and $80,000 on each of the third and subsequent anniversaries of the Lease.

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During the initial term, Silverado had an option to purchase the placer claims for $500,000 less royalty payments and an option to purchase the lode claims for $300,000, each subject to applicable price adjustments. Silverado has an option to purchase certain additional lode claims for $5,000,000.

Under the Lease, Silverado may cure any default relating to required royalty payments within thirty (30) days following notice of such default from ALMINCO, after which time ALMINCO may terminate the Lease if such default has not been cured. ALMINCO may not terminate the Lease for any other default for so long as Silverado is diligently attempting to cure such default.

ii.     Lease and Purchase Agreement (King) - The Eagle Property

Silverado has an equal (50%) ownership interest in 77 state mining claims with Kathleen King (“King”). Silverado will acquire a full (100%) ownership interest in such state mining claims upon the payment of an additional $48,000 to King in installments of $5,000 per year.

iii.    Agreement For Conditional Purchase And Sale Of Mining Property (May et. al.) - The Ester Property

Silverado is party to an Agreement For Conditional Purchase And Sale Of Mining Property (the “1979 Agreement”), dated May 12, 1979, with Donald J. May, Paul I. Barelka, and Mark Thoennes (collectively, the “Sellers”) pursuant to which Silverado agreed to conditionally purchase certain unpatented state mining claims located in Fairbanks, Alaska (the “1979 Claims”), including all other then-owned and after-acquired mining claims or interests in mining claims within one mile of any portion of the 1979 Claims, from the Sellers. The state mining claims formerly belonging to Thoennes were acquired by Barelka and May who have deeded the claims to Polar Mining Inc. and The Fairbanks Rescue Mission respectively. The present owners of the mining claims covered under the above agreement are Fairbanks Rescue Mission and Polar Mining, Inc.

The term of the 1979 Agreement commenced on the date Silverado took possession of the 1979 Claims and will expire upon the earlier of (i) the purchase price therefore being paid in full, or (ii) a default remaining uncured for more than sixty (60) days after the date of the written notice of such default.

Title to the 1979 Claims will pass to Silverado upon its payment in full of the purchase price of $2,000,000. The purchase price is payable at 15% of net profits (as such term is defined in the 1979 Agreement) per year, adjusted for inflation, calculated on a quarterly basis, and payable within sixty (60) days of the end of each calendar quarter. Upon full payoff of the purchase price, the Sellers will be entitled to a royalty payment in the form of a carried interest of 3% of net profits from Silverado’s operations until production on the 1979 Claims is permanently terminated.

Under the 1979 Agreement, Silverado also covenanted to: (i) perform annual assessment work beginning with the assessment year ending September 1, 1980; (ii) refrain from permitting any liens or levies to be placed against the 1979 Claims, and timely pay any taxes imposed on the 1979 Claims, each until such time title is conveyed to Silverado; (iii) indemnify the Sellers from any claims arising from Silverado’s operations and conditions on the 1979 Claims arising after the date of possession; and (iv) obtain and maintain adequate insurance.

In the event of default, the Sellers must provide written notice to cure to Silverado. If the Silverado fails to cure such default within sixty (60) days after the date of such notice, the non-defaulting party’s remedy is to arbitrate the issue in accordance with the terms of the 1979 Agreement.

iv.     Exploration And Mining Lease - The Ester Property

Silverado and Gilbert Dobbs (“Dobbs”) entered into an Exploration And Mining Lease (“Dobbs Lease”), dated November 6, 1984, as amended on August 4, 1996, pursuant to which Silverado leased from Dobbs three federal lode mining claims in Fairbanks, Alaska known as the Moose Claim (BLM F061722), the Rosie Claim (BLM F061724) and the Brandy Claim (BLM F061725) (collectively, the “Dobbs Claims”), and all exploration, mining, and water rights associated therewith. The above federal Rosie and Brandy claims have been converted to four state mining claims: Rosie 1 (ADL575826), Rosie 2 (ADL575827), Brandy 1 (ADL575828), and Brandy 2 (ADL575829).

The Dobbs Lease had an initial term of ten (10) years, with automatic renewals for additional five (5) year terms to take effect beginning on November 6, 1999 and every fifth year thereafter if, at the commencement of each renewal period, the Dobbs Lease remains in good standing and Silverado pays US $10,000 to Dobbs.

In order for the Dobbs Lease to remain in good standing and for each renewal to take effect, Silverado must make royalty payments equal to 15% of the net profits (as such term is defined in the Dobbs Lease) derived from its operations on the Dobbs Claims. Such payments are due within sixty (60) days after the end of each calendar quarter. Once Silverado has paid $1,500,000 in aggregate royalty payments to Dobbs, subsequent royalty payments will be reduced to 3% of net profits derived from operations on the Dobbs Claims.

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Furthermore, Silverado must (i) perform annual assessment work beginning with the assessment year ending September 1, 1985; (ii) expend at least $1,500 per year on the Dobbs Claims until the $1,500,000 threshold is met (with such expenditures to be credited toward meeting such threshold); (iii) refrain from permitting any liens or levies to be placed against the Dobbs Claims, and timely pay any taxes imposed on the Dobbs Claims; (iv) indemnify Dobbs from any claims arising from Silverado’s operations and conditions on the Dobbs Claims arising after the date of possession; and (v) obtain and maintain adequate insurance.

In the event of default, the non-defaulting party must provide written notice to cure to the defaulting party. If the defaulting party fails to cure such default within sixty (60) days after the date of such notice, the non-defaulting party’s remedy is to arbitrate the issue in accordance with the terms of the Dobbs Lease.

v.      Agreement For Conditional Purchase And Sale Of Mining Property (Burggraf) - The Ester Property

Silverado is party to an Agreement For Conditional Purchase And Sale Of Mining Property (the “1978 Agreement”), dated October 6, 1978, with Roger C. Burggraf (“Burggraf”) pursuant to which Silverado agreed to conditionally purchase six unpatented lode mining claims located in Fairbanks, Alaska (the “1978 Claims”), including all other subsequently located or acquired claims and interests in mining property within two miles of any portion of the 1978 Claims, from Burggraf. The 1978 Claims are identified as: Irishman No.1, Roosevelt, Banjo, O’Dea, White Rock Lode, and D. and Z.

The term of the 1978 Agreement commenced on the date Silverado took possession of the 1978 Claims and will continue until the earlier of (i) the purchase price therefor being paid in full, (ii) a default by Silverado remaining uncured for more than sixty (60) days after the date of the written notice of such default, or (iii) Silverado providing sixty (60) days notice of termination to Burggraf.

Title to the 1978 Claims will pass to Silverado upon its payment in full of the purchase price of $2,000,000. The purchase price is payable at 15% of net profits (as such term is defined in the 1978 Agreement) per year, calculated on a quarterly basis, and payable within sixty (60) days of the end of each calendar quarter. The 1978 Agreement also called for Silverado to issue an aggregate of 100,000 shares of its common stock to Burggraf over the course of four (4) years from the date thereof. Once Silverado pays the purchase price in full to Burggraf, it will be obligated to make royalty payments equal to 3% of net profits derived from its operations on the 1978 Claims until production is terminated. Furthermore, if any agreement is reached with a third party concerning properties owned by such third party within two miles of any portion of the 1978 Claims, Burggraf will be entitled to royalty payments equal to 2% of net profits derived from Silverado’s operations on the 1978 Claims. The original six federal unpatented federal lode claims incorporated in the “1978 Agreement with Burgraff” have been converted to state mining claims: Grant 26-31(ADL 536564-536569). All mining claims under the agreement are now state mining claims.

Silverado is also obligated to (i) perform annual assessment work beginning with the assessment year ending September 1, 1979; (ii) expend up to $15,000 per year on the 1978 Claims until the $2,000,000 purchase price is paid (with such expenditures to be credited toward Silverado’s payment of the purchase price); (iii) refrain from permitting any liens or levies to be placed against the 1978 Claims, and timely pay any taxes imposed thereon; (iv) indemnify Burggraf from any claims arising from Silverado’s operations and conditions on the 1978 Claims arising after the date of possession; and (v) obtain and maintain adequate insurance.

In the event of default, the non-defaulting party must provide written notice to cure to the defaulting party. If the defaulting party fails to cure such default within sixty (60) days after the date of such notice, the non-defaulting party’s remedy is to arbitrate the issue in accordance with the terms of the 1978 Agreement.

The maximum size of a federal placer mining claim is 20 acres, and the maximum size of a federal lode mining claim is 20.7 acres. The maximum size of a state of Alaska mining claim is 40 acres. Given the occasional necessity of forming "fractional" mining claims to infill between properties or to account for staking or survey errors, and using these maximum sizes, we estimate that Silverado either owns or leases a total of approximately 8,400 acres of federal lode claims, 4,050 acres of federal placer claims, and 5,125 acres of state mining claims.

COMPETITION

We are a mineral resource exploration company. We compete with other mineral resource exploration companies for financing and for the acquisition of new mineral properties. Many of the mineral resource exploration companies with whom we compete have greater financial and technical resources than those available to us. Accordingly, these competitors may be able to spend greater amounts on acquisitions of mineral properties of merit, on exploration of their mineral properties and on development of their mineral properties. In addition, they may be able to afford more geological expertise in the targeting and exploration of mineral properties. This competition could result in competitors having mineral properties of greater quality and interest to prospective investors who may finance additional exploration. This competition could adversely impact on our ability to finance further exploration and to achieve the financing necessary for us to develop our mineral properties.

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EMPLOYEES

We do not have any employees. Our operating and administrative activities are carried out through our agreements with the Tri-Con Mining Group.

RESEARCH AND DEVELOPMENT EXPENDITURES

We have spent the following amounts on research and development activities during the past two fiscal years:

Research and development activities were primarily attributable to the pursuit of the development of our Green Fuel business. During 2007 and 2008, the majority of the research and development costs attributable to the low-rank coal-water fuel technology related to further technical work on the fuel creation temperature.

ENFORCEABILITY OF CIVIL LIABILITIES

Our headquarters are located in, and our officers and directors are residents of, Canada. Further, some of our assets are, or may be, located outside the United States. Accordingly, it may be difficult for investors to effect service of process within the United States on us or our officers and directors, or to enforce against them judgments obtained in United States courts predicated upon the civil liability provisions of the United States federal securities laws. There is also uncertainty as to both an investor’s ability to enforce, in an appropriate foreign court, judgments of United States courts based upon the civil liability provisions of the United States federal securities laws, and an investor’s ability to bring an original action in an appropriate foreign court to enforce liabilities against us or any person based upon the United States federal securities laws. If investors have questions with respect to these issues, they should seek the advice of their legal counsel.

ITEM 1A. RISK FACTORS

We face risks in completing our exploration plans and achieving revenues. The following risks are material risks that we face. If any of these risks occur, our business, our ability to achieve revenues, our ability to produce gold, our operating results and our financial condition could be seriously harmed.

If we do not obtain new financings, the amount of funds available to us to pursue exploration activities at the Nolan Gold Project and to pursue further exploration of our mineral properties will be reduced.

We have relied on recent private placement financings in order to fund exploration of the Nolan Gold Project. We will continue to require additional financing to complete our plan of operations for exploration work at the Nolan Gold Project and to carry out our exploration programs on our other mineral properties. While our financing requirements may be reduced through gold recoveries, any impairment in our ability to raise additional funds through financings would reduce the available funds for the exploration of the Nolan Gold Project, including additional test mining activities, with the result that our plan of operations may be adversely affected and potential recoveries reduced or delayed.

As we have not reported revenues in our last three fiscal years there is no assurance that we will be able to achieve the financing necessary to enable us to proceed with our exploration activities, including test mining activities.

We had deficit working capital of $1,293,886 as of November 30, 2008. We did not report revenues in our last three fiscal years ended November 30, 2008, 2007 or 2006. Our plan of operations calls for expenditures of a minimum of $10,000,000 to be incurred by us over the next twelve months in order to continue our mining exploration activities at the Nolan Gold, Ester Dome, Eagle Creek and Hammond Projects. While we will apply proceeds from gold sales generated from our test mining activities to cover our exploration expenditures, we anticipate that proceeds from gold sales over the next twelve months may not exceed our projected expenditures during this period with the result that we will require substantial financing in order for us to pursue our plan of operations. If we do not achieve the necessary financing, then we will not be able to proceed with our planned exploration activities, including our planned test mining activities, and our financial condition, business prospects and results of operations will be materially adversely affected.

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We are a mineral exploration company with interests in properties located throughout the state of Alaska. The majority of such properties are in various stages of exploration, and there is no assurance that a commercially viable mineral deposit exists on all of such properties.

Thomas K. Bundtzen, an independent third party mining consultant and an AIPG and NI 43-101 Qualified Person, completed a Preliminary Feasibility Study for the Company effective January 1, 2009. The study concluded that the lode gold and antimony deposit underlying Workman’s Bench and the southwestern portion of the Solomon Shear Zone contain probable reserves. Nevertheless, there is no assurance that we will be able to recover quantities of gold and antimony in these areas or in any others that will enable us to achieve sales of gold and antimony that will exceed our costs of recovering the gold and antimony.

If we are unable to achieve projected gold recoveries from our test mining activities at the Nolan Gold Project, then our financial condition will be adversely affected and we will have less cash with which to pursue our operations.

We plan to undertake test mining activities as part of our exploration program for the Nolan Gold Project. Our objective is to recover gold from test mining activities to offset the exploration cost of our test mining activities. As we have not established any reserves on this property, there is no assurance that actual recoveries of gold from material mined during test mining activities will equal or exceed our exploration costs. If gold recoveries are less than projected, then our gold sales will be less than anticipated and may not equal or exceed the cost of exploration and recovery in which case our operating results and financial condition will be adversely affected.

If the price of gold declines, our financial condition and ability to obtain future financings will be impaired.

Our business is extremely dependent on the price of gold. Our recoveries from sales of gold for the current fiscal year are dependent on the price of gold in addition to the quantity of gold that we are able to recover. If gold prices decline prior to the recovery and sale of gold from the Nolan Gold Project, then our recoveries from sales of gold and financial condition will be adversely impacted. We have not undertaken any hedging transactions in order to protect us from a decline in the price of gold. A decline in the price of gold may also decrease our ability to obtain future financings to fund our planned exploration programs activities.

The price of gold is affected by numerous factors, all of which are beyond our control. Factors that tend to cause the price of gold to decrease include the following:

If costs of gold recovery at our Nolan Gold Project are higher than anticipated, then our financial condition and ability to pursue additional exploration will be adversely affected.

We have proceeded with test mining activities on the Nolan Gold Project on the basis of estimated capital and operating costs. If capital and operating costs are greater than anticipated, then cash used in test mining activities at the Nolan Gold Project will be greater than anticipated. Increased cash used in test mining activities will cause us to have less funds for other expenses, such as administrative and overhead expenses and exploration of our other mineral properties and further test mining activities on the Nolan Gold Project. In this event, our financial condition will be adversely affected and will have fewer funds with which to pursue our exploration programs.

If our exploration costs are higher than anticipated, then our financial condition and ability to pursue additional exploration will be adversely affected.

We are currently proceeding with exploration of our mineral properties on the basis of estimated exploration costs. This exploration program includes drilling programs at various locations within the Nolan Gold Project. If our exploration costs are greater than

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anticipated, then we will have fewer funds for our exploration activities, including test mining activities that we plan to carry out at our Nolan Gold Project, and for our general and administrative expenses. In this event, our financial condition will be adversely affected, our losses will increase and we will have fewer funds with which to pursue our exploration programs. Factors that could cause exploration costs to increase include adverse weather conditions, difficult terrain and shortages of qualified personnel.

Exploration activities, including test mining and operating activities are inherently hazardous.

Mineral exploration activities, including test mining activities, involve many risks that even a combination of experience, knowledge and careful evaluation may not be able to overcome.

Operations that we undertake will be subject to all the hazards and risks normally incidental to exploration, test mining and recovery of gold and other metals, any of which could result in work stoppages, damage to property and possible environmental damage. The nature of these risks are such that liabilities might result in us being forced to incur significant costs that could have a material adverse effect on our financial condition and business prospects.

There is no assurance that any of our mineral resources will ever be classified as reserves under the disclosure standards of the Securities and Exchange Commission.

This annual report discusses our mineral resources in accordance with Canadian National Instrument 43-101, as discussed under the section of this annual report entitled “Description of Properties”. Resources are classified as “measured resources”, indicated resources” and “inferred resources” under NI 43-101. However, U.S. investors are cautioned that the United States Securities and Exchange Commission does not recognize these resource classifications. There is no assurance that any of our mineral resources will be converted into reserves under the disclosure standards of the United States Securities and Exchange Commission except for those probable reserves defined in the January 1, 2009 report earlier referenced in this document. Further, “‘inferred resources” have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that part or all of an “inferred resource” exists, or is economically or legally mineable.

If we experience exploration accidents or other adverse events at our Nolan Gold Project, then our financial condition and profitability could be adversely affected.

Our exploration activities, including test mining activities, at the Nolan Gold Project are subject to adverse operating conditions. Exploration accidents or other adverse incidents, such as cave-ins or flooding, could affect our ability to continue test mining activities at the Nolan Gold Project. A particular concern at the Nolan Gold Project is warm temperatures that can reduce the winter season during which we can safely conduct underground test mining activities. The occurrence of any of these events could cause a delay in production of gold or could reduce the amount of gold that we are able to recover, with the result that our ability to achieve recoveries from gold sales and to sustain operations would be adversely impacted. Adverse operating conditions may also cause our operating costs to increase. Exploration accidents or other adverse events could also result in an adverse environmental impact to the land on which our operations are located with the result that we may become subject to the liabilities for environmental clean up and remediation.

If we become subject to increased environmental laws and regulation, our operating expenses may increase.

Our exploration activities, including test mining activities, are regulated by both US Federal and State of Alaska environmental laws that relate to the protection of air and water quality, hazardous waste management and mine reclamation. These regulations may impose operating costs on us. If the regulatory environment for our operations changes in a manner that increases costs of compliance and reclamation, then our operating expenses would increase with the result that our financial condition and operating results would be adversely affected.

Because of the speculative nature of exploration of mineral properties, there is no assurance that our exploration activities will result in the discovery of new commercially exploitable quantities of minerals or that we will be able to establish proven and probable reserves as a result of our exploration.

We plan to continue exploration on our mineral properties. The search for valuable minerals as a business is extremely risky. We can provide investors with no assurance that additional exploration on our properties will establish that additional commercially exploitable reserves of gold exist on our properties. Problems such as unusual or unexpected geological formations or other variable conditions are involved in exploration and often result in exploration efforts being unsuccessful. The additional potential problems

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include, but are not limited to, unanticipated problems relating to exploration and attendant additional costs and expenses that may exceed current estimates. These risks may result in us being unable to establish the presence of commercial exploitable quantities of ore on our mineral claims with the result that our ability to fund future exploration activities may be impeded

As we face intense competition in the exploration industry, we will have to compete with our competitors for financing and for qualified managerial and technical employees.

The exploration industry is intensely competitive in all of its phases. Competition includes large established exploration companies with substantial capabilities and with greater financial and technical resources than we have. As a result of this competition, we may be unable to acquire additional attractive mining claims or financing on terms we consider acceptable. We also compete with other exploration companies in the recruitment and retention of qualified managerial and technical employees. If we are unable to successfully compete for financing or for qualified employees, our exploration programs may be slowed down or suspended.

Our business venture into the low rank coal water fuel business is subject to a high risk of failure.

Our business venture into the low rank coal water fuel technology business is at a very early stage and is subject to a high risk of failure. The low rank coal water fuel technology has not been proven by us to be a commercially viable fuel alternative. In order to establish commercial viability, we will have to undertake the construction and operation of the contemplated demonstration facility. The construction and three year operation of the demonstration facility would cost approximately $26 million. Even if the demonstration facility were constructed and operational, there is no assurance that the commercial viability of this process would be established or that we would be able to expand the facility into a commercially viable operation or to generate revenues from this technology. We are pursuing funding from the United States federal and state governments and from private sources to fund the construction of the demonstration facility. There is no assurance that we will succeed in obtaining government or private funding for this project. Even if funding is obtained and the demonstration facility constructed, there is no assurance that we would be able to generate profits or revenues from the operation of the demonstration facility.

ITEM 2. DESCRIPTION OF PROPERTY

Our head office is located at Suite 1820, 1111 West Georgia Street, Vancouver, British Columbia, Canada V6E 4M3. These premises are comprised of approximately 4,752 square feet and are leased for a term expiring in July 2014.

Our four groups of mineral properties located in Alaska are described below. This disclosure incorporates the results of technical reports prepared during 2008 by Thomas K. Bundtzen (“Bundtzen”/the “QP”), a third party independent qualified person and certified professional geologist, in accordance with the requirements of Canadian National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”). The resource information listed below is different from resource information and resource totals previously disclosed in our 2007 Annual Report on Form 10-KSB. The more recent 2008 resource estimates are different because Bundtzen determined that some of the data used for the 2007 resource estimates was outdated. Investors may view the NI 43-101 reports at the Company’s website at www.silverado.com.

The NI 43-101 reports provide disclosure regarding Silverado’s Alaska properties in accordance with NI 43-101. U.S. Investors are cautioned that the United States Securities Commission does not recognize the terms “indicated resources” and “inferred resources”, as more particularly discussed below.

The Company holds interest in the following four groups of mineral properties in Alaska:

We are a mineral exploration company with interests in properties located throughout the state of Alaska. The majority of such properties are in the early stages of exploration, and there is no assurance that a commercially viable mineral deposit exists on such properties.

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NOLAN GOLD PROJECT

Effective January 1, 2009, based on completion of a preliminary feasibility study, our Nolan Gold and Antimony Lode Project has disclosed an economically viable mineral reserve. The preliminary feasibility study concluded that the resource estimates disclosed by the Company in its Current Report on Form 8-K on November 17, 2008 can be reclassified as a probable reserve. Though there were no material changes to the grades and quantities previously reported on November 17, 2008, there was additional data produced that added new grades and there was further work conducted on this zone that resulted in the aforementioned reclassification.

1.    Location and Access

The majority of the properties comprising our Nolan Gold Project are adjacent to or within the Nolan Creek Valley, located approximately 8 miles northwest of the small town of Wiseman, and 175 air miles north of Fairbanks, Alaska in the southern foothills of the Brooks Range. Centrally located in the historic Koyukuk Mining District, Nolan Creek is a southerly flowing tributary to Wiseman Creek which flows southeasterly into the Middle Fork of the Koyukuk River. The Nolan Gold Project is accessible by the Elliott and the Dalton Highways, about 280 road miles north of Fairbanks Alaska. An all weather road connects the Nolan Creek Camp with the Dalton Highway and is suitable year-round for semi-tractors loaded with fuel and equipment. Air transportation is available by several commercial carriers from Fairbanks to the 4,500 ft long, state maintained Coldfoot Airport. The community of Coldfoot Alaska is about 15 miles south-southeast of Nolan, and has Alaska’s northernmost gas station, grocery, and public lodging. Coldfoot also has a weather station provided by the Alaska State Weather Service, and a post office.

All of the Nolan Gold Project properties are on federal land and located within the Wiseman B-1 Quadrangle. All of the mineral claims, with the exception noted below, are in the SE ¼, Township 31 North, Range 12 West, the NE ¼, Township 30 North, Range 12 West, and SW ¼, Township 31 North, Range 11 West, Fairbanks Meridian.

In addition to the Nolan Creek properties, Silverado also has two smaller placer claim groups on Clara Creek and Marion Creek, located 1.5 and 3 miles north respectively of the town of Coldfoot, Alaska, situated near the Dalton Highway.

A map illustrating the location and access to the Nolan Gold Project is provided below:

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2.    Property Description and Ownership Interest

All of the mineral properties at the Nolan Gold Project are federal mining claims. Federal mining law allows for a locator to stake either a placer deposit or a lode deposit. Under the federal mining law, a 20 acre placer claim with the dimensions of 660 feet by 1,320 feet may be staked. Lode mining claims have dimensions of 600 ft by 1,550 ft.

As of November 30, 2008, Silverado’s Nolan Gold Project consist of 204 unpatented, federal placer mining claims covering approximately 4,080 acres in three non-contiguous groups, and 407 unpatented federal lode mining claims covering approximately 8,140 acres in one large contiguous group. Many of the 407 lode mining claims are superimposed over the placer mining claims. There has been no legal survey on any of the claims. These groups of properties are described in the next subsection.

The majority of the Nolan Creek mining claims are controlled by Silverado Gold Mines Inc., a wholly owned subsidiary of Silverado. Many of the claim names acquired or staked by Silverado have historic names such as Mary’s Bench and Workman’s Bench. Beginning in 2006, new lode and placer claims were designated in numerical succession.

Annual fees were paid to the federal government. The Company paid the claim maintenance fee of $125 dollars per claim due before September 1, 2008. Maintenance and holding fees for the federal placer and lode mining claims for the Nolan Gold Project totaled $76,375 USD, which were paid July 31, 2008 to the Bureau of Land Management. An affidavit of evidence of maintenance fees paid for federal mining claims was filed on August 6, 2008.

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(a)    Nolan Gold Project Placer Property

Our Nolan Gold Project placer claim holdings are comprised of 197 contiguous unpatented federal placer mining claims located within the Nolan and Hammond River drainage systems. Silverado also holds 2 unpatented federal placer mining claims located on Marion Creek and 5 unpatented federal placer mining claims located on Clara Creek. Both Clara and Marion Creeks are left limit tributaries to the Middle Fork of the Koyukuk River. The Clara Creek and Marion Creek claims are located approximately 1.5 and 3 miles north of Coldfoot, Alaska, respectively, and are situated near the Dalton Highway. Silverado is the registered owner of all 204 placer claims. Over the years Silverado has conducted operations on this property entitled: the Nolan Deep Channel, Smith Creek, Thomson’s Pup, Mary’s Bench, Swede Channel, Mary’s East, Archibald Creek, Mary’s East, Workman's Bench, Upper Nolan Creek, Dolney Bench, West Block, "3B1" on Nolan Creek, and Eureka Bench, et al. The main block of contiguous Nolan Placer claims cover approximately 6 square miles of creeks and fluvial terraces and uplands.

Of these claims, the Thomson’s Pup claims consist of 6 unpatented federal placer claims. The Company’s ownership in these claims is subject to a royalty of 3% of net profits on 80% of production payable to Frank Figlinski and Lyle R. Carlson.

(b)    Nolan Lode

The Nolan Lode claims are comprised of 407 unpatented federal lode claims. This number consists of the original 67 claims plus 241 claims added during 2006 and 99 claims added during 2007. Ownership of these federal lode claims is in the name of Silverado Gold Mines Inc. This area encompasses approximately 8,140 acres.

3.    History of Operations

Placer mining on Nolan Creek and its tributaries was first recorded at about the turn of the last century. During the ensuing years and up to 1942, recoveries of approximately 120,000 oz. of placer gold were reported. This gold is well known for its coarse size and high fineness. The early miners mined Nolan Creek and its left limit tributaries, particularly Fay, Archibald and Smith creeks by surface methods on the upper areas and by underground methods in the lower reaches of the creeks when overburden became too deep. Shafts are found throughout these areas.

We first began acquiring placer claims on Nolan Creek in 1979. The following table summarizes gold production and gold recoveries by year from the Nolan properties since 1980.

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*Includes 1,320 ounces produced by lessee.

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We have not achieved profitability in any of the years during which we have carried out test mining activities at the Nolan Gold Project.

We did not carry out any gold recovery operations during 2004 and 2005 as we focused on lode exploration on the property, as opposed to test placer mining activities. We also did not carry out any gold recovery operations in 2008, as we focused on the lode exploration program.

During the winter of 2005, Silverado began an underground exploration and development program on the Swede Channel. Continuing into 2006, Silverado installed about 900 feet of exploration drifts by underground tunneling methods into the Swede Channel. Prior bulk sampling had shown the channel to contain gold in the basal gravels, so the project was designed to obtain a large bulk sample from the tunnel being advanced into the channel. The 2005-2006 winter stockpile contained 8,896 LCY of gravel material, and was processed between June 28^th through July 20^th of 2006, yielding 939.07 troy ounces of gold nuggets and dust. The Swede portal was re-opened in early November of 2006, and gravel extraction on the remaining sections of the Swede Channel continued until its completion by the middle of January 2007. A total of 8,963 LCY of gravel material was stockpiled from the remaining Swede Channel.

In early January 2007, crews installed a portal into Mary’s East, and began an underground drift into the Mary’s East deposit. The Mary’s East project was completed at the end of March 2007 and 9,357 LCY of gravel material was stockpiled from this project.

The 2006-2007 winter stockpile contained 18,320 LCY (Swede Channel and Mary’s East combined) of gravel material, and was processed from June through July of 2007 at the existing sluice plant location, yielding 2,811.74 troy ounces of gold nugget gold and over 207 pounds of concentrate that contained gold particles smaller than ¼ inch in size. The fine concentrate yielded 915.06 try ounces of gold (30% gold), which when combined with 2811.74 troy ounces of nugget gold recovered in 2007 totals 3726.80 troy ounces. Also, the fine concentrates yielded 65.10 troy ounces of silver or 2.15% silver.

4.    Present Condition of the Property

We have spent approximately $35,000,000 over the last 20 years acquiring, exploring and undertaking test mining activities and test exploration on the Nolan Gold Project. Up to November 30, 2008 we have completed 851 placer drill holes with a cumulative total of 49,370 feet of drilling. About 219 of those drill holes were completed along the frozen gold bearing deep channel of the Nolan Creek known as the Nolan Deep Channel. We have also completed lode exploration drill holes with a cumulative total of over 16,152 feet of diamond core drilling..

We also have a gold recovery facility located at the Nolan Gold Project that is used to recover gold from gravel that we extract during test mining activities as part of our exploration of the Nolan Gold Project. This gold recovery facility was modernized in 2006. Our gold recovery facility incorporates nugget traps, hydraulic riffles, classification and gravity concentration processes in order to remove gold present in gravel material. The gold recovery facility has a processing rate of 75 cubic yards of gravel material per hour. The gold facility can only be operated in the late spring to early fall months when free-flowing water is available to operate the plant.

On May 17, 2007, Silverado entered into a 10-year "shared well agreement" with Sukakpak, Inc., an Alaskan corporation, through which Silverado designed, drilled and installed at its expense a high-capacity water well in the nearby rural community of Wiseman, Alaska, to serve both as a source of high-quality drinking water, and a high-volume source of sample processing water. In addition, Silverado upgraded its Nolan Gold Project drinking water storage facility to a series of three fully-enclosed 2,000-gallon plastic storage tanks, and also a modern multi-modular kitchen and dining facility. Silverado also expended approximately $85,400 for the design and installation of a state-of-the-art "fast activated sludge treatment" (FAST®) arctic-capable wastewater treatment facility designed by Lifewater Engineering Company of Fairbanks, Alaska that is capable of serving the treatment needs of up to 24 personnel, and that treats the camp's domestic wastewater to such a high quality that it can be discharged directly to the land surface. The design, construction and installation of the wastewater facility was undertaken under the approval of the Alaska Department of Environmental Conservation (ADEC).

Currently we have a fully functioning all season enclosed 23 man camp (Nolan Camp) with three functioning offices with computers and internet access. The camp has a STW treatment plant for sewage and graywater treatment. The camp site also has a large mechanics shop for working on heavy equipment such as backhoes and bulldozers. The camp also has multiple ADEC approved containments with tanks capable of storing 30,000 gallons of diesel fuel, and a peripheral explosives storage area. The camp also has an abundance of heavy equipment for excavating and road maintenance.

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Exploration Objectives for the Nolan Gold Project

Our exploration plans are to expand our reserves on Workman’s Bench and further define gold deposits in order to provide a basis for the assessment of the feasibility of future additional test mining activities at the Nolan project. We are currently undertaking an extensive geological exploration program on the Nolan Gold Project. The program includes drilling, as well as the review of geological, geochemical and geophysical data. We are currently preparing for the development stage on our Nolan Lode and Antimony Project. The Company has acquired a permit to collect a 1,000 cu yd bulk sample of quartz-antimony-gold from the mineralized zone in the Workman’s Bench portion of the Solomon Shear Zone. We have also completed a preliminary feasibility study effective January 1, 2009. The overall objectives of our exploration program are as follows:

We have been working on interpreting the geology of the Nolan area since 1979, when we first acquired the project. Our latest and most extensive exploration program began in early 2007 and was directed at improving our placer deposit definition and discovering potential lode sources of the placer gold. Our exploration geologists and mining engineers have worked to move this objective forward. Our exploration efforts have included the analysis of geophysical data, geochemical sampling results, Company records and analysis provided by government mineral investigation efforts and publications as well as the trenching and exploration drilling of target areas. The exploration strategy and focus has changed slightly since the beginning of 2007, and is discussed below.

Exploration Strategy and Focus

The current focus of the Company is the advancement toward the development stage of our Nolan Gold and Antimony Project, especially along the southwestern end of the Solomon Shear Zone in the Workman’s Bench Area. The Company is in a transitional phase between exploration and development/mining.

The current exploration strategy involves a complete systematic approach that combines placer gold test mining data, soil geochemical data, geophysical data, percussion drilling data and diamond drill core data for the further delineation of potential lode sources for gold and antimony in the areas known as Pringle and Workman’s Bench. Our strategy also involves performing studies in preparation for the development & mining stage for the antimony-gold deposit underlying the Workman’s Bench. These studies include but are not limited to geotechnical studies of the bedrock for underground engineering and design purposes, additional hydrologic studies

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proximal to our planned underground workings, as well as collecting additional bulk samples of stibnite-gold vein material for larger scale milling and processing tests, and various environmental baseline studies.

The Company plans to drill more diamond core drill holes for additional estimates of reserves. We will continue to take advantage of the historic roads and trails on our property to use mobile heavy equipment for digging trenches into the bedrock for more accurate geologic interpretation and moving other mobile equipment like our newly acquired diamond core drill.

Prior to 2007, Silverado’s exploration efforts focused more on placer gold test mining activities , with only minor emphasis on drilling the bedrock to test for lode gold potential. Between 1993 and 2006, the Company drilled 14 percussion-reverse circulation (RC) drill holes totaling 3,695 ft. into bedrock and collected 727 assays for gold and antimony mineralization. The RC drilling indicated gold and antimony mineralized quartz veins . Although the data from the RC drilling indicated desired mineralization, it did not allow for the determination of the true width of the veins or other pertinent insitu information as the RC holes were used primarily to gather placer gold data. The recent focus of exploring for a lode gold and antimony deposit involves the use of a diamond core drill which allows the geologist to make determinations of the true width of mineralized veins and the relationship of the veins to other primary geologic structures. The diamond drill core allows for more accurate analysis of grade and interpretation of style of mineralization and timing of mineralization relative to other structures in the rock.

5.    Geology

The Nolan Area properties are located in the Brooks Range of northern Alaska. Regionally, the area is underlain by a series of metasedimentary rocks of the Coldfoot subterrain and Hammond subterrain of the Arctic Alaska terrain. The metasedimentary rocks have been assigned a Middle to Upper Devonian age. During Late to Early Cretaceous time, the Middle Devonian metasedimentary rocks of the Coldfoot subterrain were thrust northward onto the Middle to Upper Devonian metasedimentary rocks of the Hammond Subterrain. This is represented by a large thrust belt in the Nolan area and resulted in regional metamorphism of the continental rocks that were overridden.

The property area is underlain by gray–black phyllite, black slate and metasiltstone, gray–black and brown slate, brown micaceous schist and phyllite, gray–black micaceous schist, gray green to black muscovite schist that locally contains abundant pyrite and arsenopyrite, and banded quartzite interbedded with chloritic quartzite and quartz mica schist.

The valley bottoms and side hills are mantled by a heavy cover of glacial outwash and lake bottom sediments. Depth of overburden varies from a very few feet on the upper slopes to tens to hundreds of feet in the lower valley bottoms on the claims. Deeper areas of cover are permanently frozen. There have been four periods of glaciation on the Nolan properties and the placer gold distribution has been variously affected by the glaciation.

The placer deposits are of three types:

Placer gold, lode gold and antimony are the main type of mineralization of interest on the property. We are currently exploring for a lode source for the placer gold. Known gold-bearing lodes identified on the Nolan Lode properties consist of stibnite-bearing quartz veins, and quartz veins containing free gold, which fill fractures cutting phyllite and metasiltstones.

Analysis of obtained airborne geophysical data identified a linear resistivity low that has been named the “Solomon Shear trend”. The resistivity low is coincident with a geochemical anomaly for gold, antimony, arsenic and other indicator minerals. This anomaly trends sub-parallel to Nolan Creek along the east side from south of Smith Creek into the Hammond River drainage. Immediately east of this trend lies a second sub parallel resistivity low also identified by airborne geophysics and showing similar characteristics to the “Solomon Shear Trend”.

The Company has identified a new zone with anomalous gold mineralization, which has been named “the Fortress”. The Fortress area is part of an east-west trending deformation zone that is overlain by strong arsenic and gold in soil anomalies, which are up to over 1,500 feet in length.

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We will continue our exploration program in 2009 with the objective of identifying mineralization of commercial significance along this zone.

We have discovered a number of new areas that contain placer gold mineralization on the Nolan property that are too loosely defined under NI 43-101 to allow the mineralization to be categorized as a resource. Additional exploration drilling and testing may bring these mineralized areas up to a higher level of confidence and thus a higher category which could be included in the total gold inventory of the property. There is no assurance however that this upgrade will take place.

6.    2008 Nolan Gold and Antimony Project Mineral Reserves and Resource Estimates.

The following results are based on a Preliminary Feasibility study performed by Thomas K. Bundtzen (“Bundtzen”/the “QP”) of Pacific Rim Geological Consulting Inc. Bundtzen is an independent third party mining consultant who is an AIPG Qualified Person. The Company requested the study in September 2008. The study concluded that the lode gold and antimony deposit underlying Workman’s Bench and the southwestern portion of the Solomon Shear Zone, contains a probable reserve.

For a complete summary of the data used and the methods of determination of the lode resource estimates, readers are encouraged to view the recent 43-101 report by Bundtzen, effective January 1, 2009, which is posted on the Company’s website and on EDGAR and SEDAR.

General Note Regarding Estimates

The following information should be considered in connection with our estimates for Workman’s Bench, which we are disclosing in accordance with applicable SEC standards and regulations:

• Assumed Prices of US $700/oz for gold and US $2.25/lb for antimony.
• Process Recovery Rates of 85% for antimony and 90% for gold (as provided by Hazen Research from work done on an underground bulk sample from the D tunnel of the Workman’s Bench A vein and using gravity and water recovery systems only).
• Estimated Operating Costs of US $375/ton, based on operation of a 92 ton per day underground mine.

A cutoff grade of 4% antimony was used in our analysis. A 4% cutoff grade should be regarded as 4% antimony equivalent. No cutoff grade was used for gold, as antimony was the primary commodity being examined, and none of the resource polygons contained less than 0.05 oz/ton gold.

The reserve estimates for each of the three zones (A, B, and West) were determined by drill hole intercepts of each zone as well as channel samples of the zone from the underground workings. The QP used a polygonal estimation of grade by compositing sample assay information taken within designated widths and lengths of mineralized zones, giving consideration only for intercepts with an antimony value greater than 4% antimony (7% stibnite). A total of 124 intercepts of antimony-quartz-gold were assayed from the 41 diamond core drill holes for the three zones.

Considering the specific gravity of pure stibnite is 4.52 and quartz and schist gangue are 2.70 and 2.66 respectively, The QP used a tonnage factor of 8.2 cubic ft per ton (massive stibnite would be 7.1 cubic ft per ton).

Polygonal Calculations of tons, Grades and Amounts of Antimony and Gold

Readers are cautioned that the following estimates are under the category of a probable reserve and they are not a proven reserve, which requires a higher degree of feasibility study. These values are based off of a preliminary feasibility study, which is not the same as a legal feasibility study.

The following tables summarize the polygon calculations used by the QP to determine the probable mineral reserves for the Workman's Bench gold and antimony deposit, effective January 1, 2009. The data below is based off of 2007 and 2008 diamond core drilling data. As well as channel samples and specific vein samples collected from our underground workings that were collected by the QP in 2008. Detailed maps, outlining the polygons used in the probable reserve estimates, are shown in the QP’s NI 43-101 technical report (feasibility study), effective January 1, 2009.

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Polygonal Probable Reserve Calculations of Workman’s Bench ‘A’ Zone, Nolan Creek, Alaska

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Polygonal Probable Reserves Calculations for ‘B’ Zone, Workman’s Bench, Nolan Creek Area, Alaska

Polygonal probable reserve Calculation for ‘West’ Zone, Workman’s Bench, Nolan Creek area, Alaska

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Total Probable Lode Mineral Reserves, for Workman’s Bench, Nolan Creek Area “A”. “B” and “West” Zones

Readers are cautioned that the following estimates are under the category of a probable reserve and they are not a proven reserve, which requires a higher degree of feasibility study. These values are based off of a preliminary feasibility study, which is not the same as a legal feasibility study.

Notes:
– Rounding may result in some discrepancies.
– No processing recovery factors have been applied to these reserve figures.
– The unit ton refers to short tons.
– Cut-off grade is 4.0% Sb ‘equivalent’, which refers to the combined values of gold plus antimony expressed in terms of antimony alone
– Effective date of the estimate is January 1,2009.

Total Inferred Lode Mineral Resources, Nolan Creek Area effective January 1, 2009

Cautionary Note to U.S. Investors concerning estimates of Inferred Resources

The following table uses the term ‘inferred resources’. Silverado advises U.S. investors that while this term is recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize this term. U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.

The following table summarizes the mineral resources for the gold and antimony deposit, effective January 1, 2009.

Notes:
– Mineral Resources which are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may
    be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
– Rounding may result in some discrepancies.
– No processing recovery factors have been applied to these resource figures.
– The unit ton refers to short tons.
– Cut-off grade is 4.0% Sb ‘equivalent’, which refers to the combined values of gold plus antimony expressed in terms of antimony alone.

Mineral Resources that are not mineral reserves do not have demonstrated economic viability.

HAMMOND PROPERTY (SLISCO BENCH)

1.    Location and Access

Our Hammond property is located approximately 8 miles north of Wiseman, and 175 air miles north of Fairbanks, Alaska in the foothills of the Brooks Range in an area known as the Koyukuk Mining District. The Hammond property is located approximately three miles northeast of the Nolan Gold Project.

The Hammond property is accessible by the Trans-Alaska Pipeline road about 280 road miles north of Fairbanks, Alaska. An all-weather 4x4 road connects Hammond to the pipeline road.

A map illustrating the location and access to the Hammond property is provided above under the heading Nolan Gold Project.

2.    Ownership Interest

Silverado leases 24 federal placer mining claims and 36 federal lode mining claims from Alaska Mining Company, Inc. (“Alminco”).

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As of November 30, 2008, we were in arrears of required mineral property claims and option payments of $390,000 and therefore our rights to the property were adversely affected. We are currently re-negotiating the terms and conditions of the Alminco agreement with Alminco. Alminco has confirmed that our mineral claims and options are in good standing on the understanding we will use our best efforts to pay the minimum royalty payments, including the payments that are in arrears for the past four years, when business conditions permit, however there is no assurance that we will be able to successfully renegotiate the terms and conditions of the Alminco agreement.

3.    History of Operations

In 1993 we acquired the group of placer gold mining claims overlying the Slisco Bench, and located along the right limit of the Hammond River. The Hammond River drainage has been the subject of intense exploration since the early 1900s. Poor exposures, difficult terrain, and deep overburden confronted the first explorers and early miners in the Hammond River region. Those miners who worked with persistence succeeded for the most part in developing small-scale projects constrained in scope by the inadequacies of their mechanical equipment, and the lack of technical knowledge and financial support. Nevertheless, because of the work done by these early explorers, the Hammond River has produced approximately eighty thousand ounces of placer gold, including the second largest gold nugget ever discovered in Alaska – a nugget weighing more than 135 ounces.

The Bench was first staked by Martin Slisco, and prospected by hand methods since the 1930’s, but no commercial production was recorded. During the late 1970s, placer gold, including some nuggets characteristic of the Koyukuk Mining District were recovered by open cut prospecting and bulk sampling from a prospect pit at the northern end of the bench. The prospect pit was open to bedrock and with a nominal 20 feet of overburden exposed, indications were favourable for defining a large open pit mine-able placer gold deposit. The surface topography indicates the bench could extend up to 4,500 feet southerly from the prospect pit. Beyond that distance the bench is intersected by the present Hammond River Channel where past and ongoing erosion has removed all surface expression of the bench. Below that intersection, the bench has been eroded and during 1995, Silverado completed a Phase I drill program, completing 64 drill holes to the south of the prospect pit. Analysis of the data from the Phase I program determined that the Slisco Bench surface topography conceals an ancient gold bearing channel. Depths of drilling to bedrock were much deeper than anticipated. Several hundred feet south of the prospect pit bedrock depths are about 60 feet below surface, increasing to more than 230 feet in depth at a distance of 1,200 feet south of the prospect pit. The gravel layer at bedrock was found to contain encouraging and sometimes, significant placer gold content at channel bottom intercepts.

In 2006, Silverado commenced drilling along the Slisco deep channel which completed additional 39 drill holes with a total footage of 4,782 feet. This exploration work was done to define the length of the Slisco deep channel. Phase one and Phase two drilling, sampling, and sample analysis of a total of 103 drill holes, has served to delineate the Slisco deep channel for a total length of 1800 lineal feet. Surface topography indicates that the channel could cover a length of up to 4,500 feet.

4.    Present Condition of the Property and Current State of Exploration

A drilling program is planned to explore the remaining 2,700 feet extending south from the present known location of the Slisco deep channel. Additional in-fill drilling will be necessary along the length of the channel, as well as potential gold bearing tributaries, and other areas by drilling fences or lines of drill holes with close hole spacing across the channel bottom. These holes will be necessary to ascertain the width of the channel, and to collect adequate sample data at close spacing, for mining feasibility studies. After completing the Phase one and Phase two drilling, data showed the channel to be narrower than the surface topography indicated and bedrock depths increased to the south. Present known maximum depth is 230 feet. We presently estimate that as many as several hundred additional drill holes would be necessary to fully define and evaluate the Slisco deep channel. The Slisco deep channel is presently in a state of ongoing exploration, and there is no camp, production facilities, or equipment located on the property. Currently, there is no power supply to the Hammond property. All support for ongoing and planned work on the property is currently provided from the Nolan Creek Camp.

5.    Geology

The primary areas of geological interest on the Hammond Property are the placer gold deposits, which are similar to the placer gold deposits present on the adjoining Nolan Gold Project. Geologically, the Slisco Bench gold-placer deposit is a deeply buried, permanently frozen, ancient and now abandoned river channel of the Hammond River. Subsequent to the geologic processes that forced the Hammond River to abandon its channel at Slisco Bench, glacial and peri-glacial processes (processes acting upon permanently frozen terraines ) buried the gold-bearing gravel of the Slisco deposit with as much as 230 feet of frozen sedimentary detritus. The deep thickness of frozen overburden identified probably prohibits the economical application of traditional open-pit methodologies. Underground placer gold recovery methods which we have utilized extensively would probably be used to remove the gold-bearing gravel.

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Mineral investigations by our geologists in conjunction with a federal study of mineral resources in the area have revealed the presence of west-north-westerly striking gold bearing hydro-thermal quartz veins on the property. Those veins, in conjunction with a north-easterly trending shear zone are thought to have contributed, at least in part, to the placer gold found on the property.

ESTER DOME PROJECT

The Ester Dome Project encompasses all of our optioned properties on Ester Dome.

1.    Location and Access

Access to the property is provided by the paved Ester Dome road and a well-maintained gravel road. The main line of the Alaska Railroad passes by the west perimeter of the property and a high capacity electrical line carrying power to the Fort Knox mill passes 300 feet below the Grant Mill on the property. A map illustrating the location and access to the Ester Dome Project is provided below:

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2.    Ownership Interest

The Ester Dome property is comprised of 52 state mineral claims and 1 unpatented federal mineral claim. The claims are not all contiguous in that there are 5 separate blocks of claims. Silverado Gold Mines Inc. is the registered owner of all claims.

The total area of all claims equals approximately 2.5 square miles and all claims are valid. There has been no legal survey on the claims.

There are three separate agreements covering the above mentioned 53 claims on the Ester Dome property.

3.    History of Operations

The Ester Dome property first became known as a result of the discovery of placer gold in the creeks draining Ester Dome in about 1902. By 1909, approximately 1.5 million oz. had been mined from alluvial deposits. Ultimately, approximately 4 million ounces of placer gold have been mined from creeks draining Ester Dome.

Shortly after the discovery of placer gold, lode claims were staked on quartz veins discovered on Ester Dome. By 1912, four stamp mills were operating in the area.

(a) Grant Mine

Work at the Grant Mine, on the eastern flank of Ester Dome, was initiated in about 1928 with the sinking of shafts to bedrock to attempt to locate buried alluvial gold. This work, while it did not locate alluvial gold, did reveal quartz rubble near bedrock containing free gold. Mr. Grant, the claim owner, sunk two shafts through about 80’ of loess (silt) cover and by 1931 had reportedly mined about 600 tons from the newly discovered Irishman Vein. This work was all completed from the only levels established, the 50, 100 and 150-foot levels. Mr. Roger Burggraf purchased the claims from Grant’s heirs in 1973 and deepened the shaft to the 200-foot level. This work revealed a new vein, the O’Dea vein which has eclipsed the Irishman vein in importance. Burggraf completed limited development on the Irishman vein and the O’Dea vein during the next 5 years, and in 1978 entered into a lease option agreement with Silverado.

Over the subsequent 8 years up to 1986, we completed an extensive surface exploration and underground development program as well as test milling the underground development muck from work on the O’Dea structure, in a small (approximately 50 tons per day) gravity mill, during 1980 – 1982. In 1984, we entered into a joint venture agreement with Aurex Inc., a subsidiary of Marubeni

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America Corporation to further explore and develop the Grant Mine plus a larger area of interest around the mine. Aurex withdrew from the joint venture at the end of 1985 and the mill was shut down in Jan. 1986. A total of approximately 22,000 tons of gold bearing rock were mined from the O’Dea structure during the period 1980 to January 1986, yielding 4,090 ounces of gold.

When Aurex became involved in the joint venture, a decision was made to construct a 230 ton per day gravity / cyanide mill to treat the expanded resource that had been outlined on the O’Dea structure above the 200’ level. This mill and related support facilities were constructed by Tri-con Mining Inc. for Silverado using a design provided by Melis Consulting Engineers Ltd. The completed mill was commissioned in October 1985 and was shut down in January 1986. During the short mill run, the plant operated above design capacity. Lower feed grades than had been forecast plus other underground problems caused Aurex to elect to withdraw from the project and a premature shutdown of the facility.

During the period 1987 – 1989, we decided to open pit mine the Ethel - Elmes structures, located a short distance from the mill facility on the Dobbs claims adjacent to the Grant Mine. This mining operation generated approximately 71,620 tons of gold bearing material. Combined with the previously mined stockpile from the O’Dea vein, (11,000 tons), and material from another source (Silver Dollar), the total tonnage processed amounted to 111,852 tons.

The total tonnage processed through the Grant mill up to 1989 amounts to 111,852 tons with a total of 11,215 oz. of gold produced for an average calculated recovered grade of 0.10 oz/ton. Gold recoveries from the Grant Mine are summarized as follows:

(1) This material was processed through a 20 ton per day pilot plant prior to the construction of the Grant Mill.

We did not make a profit from our operations at the Grant Mine during any of the above periods during which we achieved gold recoveries.

The mill has been properly secured and remains in good condition.

In June of 1990, ACNC (American Copper and Nickel Company) entered into a joint venture with us on the Grant Mine claims and a larger area of Ester Dome. This included the Dobbs, and St Paul / Barelka properties.

On the Grant Mine property, ACNC completed the drilling of 10 diamond drill holes and fourteen wedge cuts on the O’Dea – Irishman system totaling 10,097’. This work confirmed the previous drill grades and intercept width encountered by Silverado and helped to further define the O’Dea structure.

(b) St. Paul / Barelka

The St. Paul / Barelka claims have undergone a significant amount of exploration since the early 1980s when they were first acquired by us. The early work was in the form of electromagnetic surveys, geochemical soil sampling, trenching and diamond and percussion drilling. Most recently, in 1991-1992, ACNC completed 9 diamond drill holes and 3 rotary reverse circulation holes. Subsequent work in 1996-1997 amounted to significant trenching and 91 drill holes focusing on the St Paul structure which had been partially defined by our previous work.

(c) Dobbs

The Dobbs property contains the Ethel – Elmes vein system and structure which had been located in the first work and prospecting that took place on Ester Dome in the early 1900’s. Exploration in the 1980’s by us revealed a mineralized shear zone up to 25’ wide containing high grade quartz veins and veinlets. This was the structure mined in 1987 – 1989 which generated approximately 71,620 tons of gold bearing material. Combined with the previously mined stockpile from the O’Dea vein, (11,000 tons), a total of approximately 82,620 tons were mined and milled during 1988 – 1989 producing 7,362 oz. of gold.

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4.    Present Condition of the Property and Current State of Exploration (a) Grant Mine-O’Dea Vein:

The Grant Mine operations, including camp, buildings, machine shops and related equipment, were constructed in the late 1980s. Our mill and equipment are in operating condition but are not currently operating. The mill has remained inactive since February 1989. The plant and equipment cost us $2,076,780. This amount has been written down to $nil on our audited financial statements. Power to the Grant Mine operations is provided by diesel powered generators located on site. Commercial power transmission lines cross through the property, and could provide power to the facilities for any future operations. Auxiliary power to the Grant Mine operations will be provided by diesel powered generators located on site. During fiscal 2007, our work on the property was limited to assessment work. We plan to maintain claim rental payments for the current fiscal year and to continue with assessment work.

If gold prices remain strong, we may re-commence exploratory drilling on our Ester Dome properties with the objective of increasing our database of geological information on these properties.

(a) May (St. Paul) / Barelka:

The St. Paul property is undeveloped and does not contain any open-pit or underground mines. There is no plant or equipment located on the St. Paul property. Currently, there is no power supply to the St. Paul property.

We have no plans at this time to do any work other than as required for annual claims maintenance and when we do there is no guarantee the work will present economic viability for this deposit.

(b) Dobbs:

The Dobbs property is undeveloped and does not contain any open-pit or underground mines. There is no plant or equipment located on the Dobbs property. Currently, there is no power supply to the Dobbs property.

We have no plans at this time to do any work other than as required for annual claims maintenance.

5.    Geology

The Fairbanks Mining District is in the northwest part of the Yukon – Tanana metamorphic complex. This region, referred to variably as Yukon Crystalline Terrain, Yukon Cataclastic Complex or Yukon Tanana Terrain is an enormous tract of multiple deformed and metamorphosed rocks occupying much of east central Alaska and adjoining Yukon Territory.

The Fairbanks District is underlain by three metamorphosed stratigraphic packages all in apparent thrust fault contact. From oldest to youngest these are: (1) Chatanika Terrain, a Precambrian eclogite-garnet-amphibolite unit exposed on the northern edge of the district; (2) Fairbanks Schist, a dominant lithology and host to the majority of gold occurrences in the district, comprised of late Proterozoic to early Paleozoic sedimentary and volcanic rocks metamorphosed to greenschist facies; and (3) Chena River Sequence, an early to mid Paleozoic unit metamorphosed to lower amphibolite facies.

Stocks and dikes are common in the Fairbanks District, varying from diorite to granite. In recent years they have been conclusively linked to significant gold mineralizing systems. Mid Cretaceous ages have been determined for two of the stocks. Lamprophyre dikes are locally present in the district.

The Ester Dome property is underlain by late Proterozoic to early Paleozoic sedimentary and volcanic rocks that have been metamorphosed to greenschist facies. Dominant lithologies are quartz-mica schist, graphitic phyllite and micaceous quartzite, with lesser chlorite schist and calcareous schist. The schists are locally intruded by fine grained granitic to dioritic dikes and sills with minor porphyritic phases.

Four main structural patterns that crosscut stratigraphy and folding are present on Ester Dome. The most prominent is northeast trending shearing that is probably related to northeast thrusting in the region. Most of the past and present exploration has taken place along mineralized veins and shears parallel to this trend.

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6.    Estimates of Indicated and Inferred Resources

We have not established any commercially viable reserves on any of our properties that comprise the Ester Dome Project.

General Note Regarding Estimates

The following information should be considered in connection with our estimates for the Ester Dome properties, which we are disclosing in accordance with applicable SEC standards and regulations:

• Assumed Price of US $700/oz for gold.
• Process Recovery Rates of 94%
• Estimated Operating Costs of $130 per ton for an underground mine plus mill and $80 per ton for a surface mine and heap leach

Rounding may result in discrepancies. No process recovery factors have been applied to any of the following resource estimates. The unit ton refers to short tons.

The following resource estimates were extracted from a July 11, 2008 NI 43-101 report prepared by Bundtzen. Thomas K Bundtzen is an AIPG Certified geologist who represents the Company as a third party independent Qualified Person.

There are no mineral reserves estimated for Silverado’s Ester Dome properties. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

A.    GRANT MINE - O’DEA STRUCTURE

Cautionary Note to U.S. Investors concerning estimates of Indicated Resources and Inferred Resources

The following table uses the term ‘indicated resources’. Silverado advises U.S. investors that while this term is recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize this term. U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.

The following table also uses the term ‘inferred resources’. Silverado advises U.S. investors that while this term is recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize it. ‘Inferred resources’ have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. U.S. investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.

O'Dea-Grant Mineral Resources, effective July 11, 2008

B.    DOBBS – (ETHEL – ELMES)

Cautionary Note to U.S. Investors concerning estimates of Inferred Resources

The following table uses the term ‘inferred resources’. Silverado advises U.S. investors that while this term is recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize it. ‘Inferred resources’ have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of

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feasibility or pre-feasibility studies, except in rare cases. U.S. investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.

Dobbs (Ethel-Elmes) Inferred Mineral Resources, effective July 11, 2008

C.    ST. PAUL

Cautionary Note to U.S. Investors concerning estimates of Indicated Resources and Inferred Resources

The following table uses the term ‘indicated resources’. Silverado advises U.S. investors that while this term is recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize this term. U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.

The following table also uses the term ‘inferred resources’. Silverado advises U.S. investors that while this term is recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize it. ‘Inferred resources’ have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. U.S. investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.

St. Paul-Barelka Indicated Mineral Resources, effective July 11, 2008

Ester Dome Mineral Resource Totals, Effective July 11, 2008

Note: Rounding may result in discrepancies. No processing recovery factors have been applied to any of these resource estimates. The unit ton refers to short tons. The mineral resource estimates reported in this section were prepared by Bundtzen. There are no mineral reserves estimated for Silverado’s Ester Dome properties. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

EAGLE CREEK PROPERTY

1.    Location and Access

The Eagle Creek property is accessed by the Steese Highway, 10 miles north of Fairbanks, Alaska to Fox, Alaska, then traveling along the Elliot highway 6 miles north to Murphy Dome Road, then west along Murphy Dome Road about 5 miles to the property. A map illustrating the location and access to the Eagle Creek property is provided below:

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2.    Ownership Interest

The Eagle Creek property is comprised of 77 Alaska state mineral claims. All claims are contiguous and are located in the Fairbanks North Star Borough. The total area of the claims equals approximately 3080 acres and all claims are valid. There has been no legal survey on the claims. Ownership of the claims is in the name of Silverado Gold Mines Inc. There is an "option to purchase" agreement with Arley Taylor (i.e., now with his descendants), to purchase a 100% interest in the property for $400,000, of which $48,000 remains to be paid. The amount of $5,000 per year is required to be paid to keep the agreement in good standing. The original option agreement with Arley Taylor was acquired through an agreement with S. Tan who assigned the agreement to us in consideration of 15% royalty from production (15% of net operating profits after payback of costs). We have continued to make option payments on the Eagle Creek property based on the agreement, and as a result all of our mineral claims and options are in good standing.

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3.    History of Operations

Earliest work on the property started approximately in 1913, with the original owner exploring for antimony. A number of companies have explored the property from 1964 to the present.

During the early 1980s, geochemical surveys located anomalous gold and antimony targets. Drilling conducted on the property during 1991 and 1992 resulted in the outlining definition of gold mineralization hosted in intrusive rocks. Further in-fill drilling is necessary to determine continuity of the gold bearing sequence, and to ascertain grades of gold within the deposit. We will consider doing additional work on the gold-antimony bearing veins upon which the property was founded.

4.    Present Condition of the Property and Current State of Exploration

We did not complete any exploration activity on the Eagle Creek property during 2008 other than assessment work and maintenance; however, an exploration work plan that includes trenching and drilling was developed and successfully permitted through the APMA process during 2007. Extensive exploration drilling has shown gold mineralization throughout the property. Exploration of the Eagle Creek property is currently in the preliminary stages.

The Eagle Creek property is undeveloped and does not contain any open-pit or underground mines. There is no plant or equipment located on the Eagle Creek property. Currently, there is no power supply to the Eagle Creek property, although GVEA power transmission lines run through the property and could supply power in the event a facility is warranted for ore processing in the future. Surface exploration work, including geochemical and geophysical surveys is recommended to be continued as a means of tracing promising mineral bearing rock units. Drilling is recommended to test the subsurface continuity and gold content of the rock units.

5.    Geology

The Eagle Creek property is located within the same regional geology as the Ester Dome property.

The Eagle Creek property is 90% underlain by late Proterozoic to early Paleozoic sedimentary and volcanic rocks that have been metamorphosed to greenschist facies. Dominant lithologies are quartz mica schist, micaceous quartzite, graphitic phyllite and chlorite schist, with lesser calc-schist, feldspathic schist, graphitic schist and minor quartz sericite schist.

The remaining 10% of the property is underlain by felsic igneous rocks which intrude the schists in all sectors of the property. Compositions range from biotite quartz monzonite to muscovite granite. Porphyritic phases with quartz and feldspar phenocrysts are ubiquitous. Contact relations observed from mapped distribution of granitic rock fragments in soil and from diamond drill core indicate the intrusives are dikes and sills up to 200’ thick.

FEDERAL CLAIM MAINTENANCE FEES AND STATE CLAIM RENTALS

We pay an annual federal claim maintenance fee to the Bureau of Land Management (“BLM”) of $125 for each federal mineral claim that is owned by us or held under a purchase or lease agreement. We paid aggregate annual federal claim maintenance fees of $83,750 during 2007; in addition, the Company paid $18,805 to BLM for staking new claims. In 2008, we paid an annual federal claim maintenance fee of $84,000 to BLM. We anticipate an amount similar to that paid for 2008 will be due in fiscal 2009.

Annual Alaska state claim rentals are due for each state mining claim that is owned or held by us under a purchase or lease agreement. An annual fee of $130 per claim is payable by us to the Alaska Department of Revenue for each claim. We paid aggregate Alaska state claim rental fees of $16,770 in fiscal 2007 and $16,770. We anticipate that a similar amount will be paid in fiscal 2009.

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GLOSSARY OF TERMS

The definitions of geological and technical terms used in this Annual Report on Form 10-K are provided below:

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ITEM 3. LEGAL PROCEEDINGS.

The Company is not a party to any pending legal proceeding, nor is the Company’s property the subject of any pending legal proceeding. The Company also is not aware of any proceeding that a governmental authority is contemplating.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

PART II

Our common shares are quoted on the OTC Bulletin Board under the symbol “SLGLF,” on the Berlin Stock Exchange under the symbol “SLGL,” and on the Frankfurt Stock Exchange under the symbol “SLGL.” The following table indicates the range of high and low bid information of our common shares for each quarter within the last two fiscal years:

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The source of the high and low bid information is: http://ca.finance.yahoo.com. The market quotations provided reflect inter-dealer prices, without retail mark-up, markdown or commission and may not represent actual transactions.

Holders

As at March 6, 2009 we had 1,098,612,771 common shares issued and outstanding that were held by approximately 2,817 registered holders.

Dividends

We have not declared any dividends on our common stock in our two most recent fiscal years.

We are restricted in our ability to pay dividends by limitations under British Columbia law relating to the sufficiency of profits from which dividends may be paid. In addition, Silverado’s Articles (the equivalent of the Bylaws of a United States corporation) provide that no dividend shall be paid otherwise than out of funds or assets properly available for the payment of dividends and declaration by the directors as to the amount of such funds or assets available for dividends shall be conclusive.

Securities Authorized For Issuance Under Equity Compensation Plans

Set forth in the table below is information regarding outstanding equity awards made under equity compensation plans through November 30, 2008, the end of our most recently completed fiscal year.

Equity Compensation Plan Information

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There was no stock option plan adopted for fiscal year 2008.

On August 31, 2007, our Board of Directors adopted the 2007-1 Equity Compensation Plan (the "Incentive Stock Option Plan"). The Incentive Stock Option Plan was established to encourage certain of our officers, employees, directors and consultants to acquire and hold stock in the Company as an added incentive to remain with the Company and to increase their efforts in promoting the interests of the Company, as well as to attract and retain capable individuals. A maximum of twenty-five million (25,000,000) shares of our common stock can be issued under the Incentive Stock Option Plan. The aggregate fair market value of the our common shares issued to an employee in exchange for stock options under the Incentive Stock Option Plan cannot exceed $100,000 during any calendar year. The Incentive Stock Option Plan may be terminated at the discretion of the Board of Directors of the Company. On January 11, 2007, our Board of Directors adopted the 2007 Stock Option Plan (the "2007 Plan"). The 2007 Plan authorizes the issuance of options to purchase our common stock to directors, officers, employees, and eligible consultants. We reserved 25,000,000 shares of our Common Stock for awards to be made under the 2007 Plan. On February 20, 2007, we filed a registration statement on Form S-8 to register all 25,000,000 of such shares. The 2007 Plan is to be administered by a committee of two or more members of the Board of Directors. The 2007 Plan allows for the issuance of incentive stock options (which can only be granted to employees) and non-qualified stock options. The committee shall determine the type of option granted, the exercise price, the option term (which may be no more than ten years), and terms and conditions of exercisability.

Recent Sales of Unregistered Securities

We have not sold any unregistered securities during the last completed fiscal year, other than those we previously reported in Quarterly Reports on Form 10-QSB or Current Reports on Form 8-K and filed with the Securities and Exchange Commission.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

PLAN OF OPERATION

Certain forward-looking statements are discussed in this plan of operation with respect to the Company’s activities and future financial results, which are made based upon management’s current expectations and beliefs. These are subject to risks and uncertainties that may cause projected results or events to differ materially from actual results or events. There can be no assurance that future developments affecting the Company will be those anticipated by management. All currency references are in US dollar, the Company’s reporting currency, unless otherwise noted.

Our plan of operation for the next twelve months is as follows:

The Nolan Gold Project

The plan of operation for the Nolan Gold Project for the 2009 fiscal year is the advancement toward the development and mining stage of our Nolan Gold and Antimony Project, especially along the southwestern end of the Solomon Shear Zone in the Workman’s Bench Area. The Company is in a transitional phase between exploration and development. The recent preliminary feasibility study effective January 1, 2009, supported a mineral reserve of antimony and gold underlying the southwestern portion of the Solomon Shear Zone, an area referred to by the Company as Workman’s Bench. The study by Bundtzen (2008 QP) concluded that the Nolan Gold and Antimony Project in the Workman’s Bench area is economically viable.

Our plan of operations involves collecting a 1,000 cu yd bulk sample of the stibnite-gold vein material from the mineralized zones referred to as the ‘A’ Zone and possibly ‘B’ and West Zones. The bulk sample will be for larger scale milling and processing tests, and a more accurate mineralogical determination of the gold, especially what the Company has termed ‘nugget effect’ of the gold found in the massive stibnite veins. The Company believes that the grade of gold will increase upon the extraction of the larger scale bulk sample due to the ‘nugget effect’ which is not represented during the drilling effort. The successful extraction of a 1,000 cu yd sample will give a better indication of the special and physical relationships between the gold and the antimony. The bulk sample is also

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necessary for additional verification of the purity of the antimony content in the stibnite and whether or not at depth there is a potential for zonation of increased deleterious metals that could contaminate the antimony ore.

Also, the plan of operations for 2009 involves performing a variety of characterization studies in preparation for the development stage and for permitting requirements necessary for the future production of the antimony-gold deposit underlying the Workman’s Bench. These studies include but are not limited to additional hydrologic studies proximal to our planned underground workings, as well as environmental baseline studies of the flora and fauna and the baseline chemical and physical parameters of the creek water, and acid-base accounting (ABA) studies of the ore-hosting rock determining an appropriate, effective and safe disposal of acid mine waste rock.

Much of the work planned for 2009 is seasonal dependent. During the summer months we plan to use our diamond core drill for infill drilling for additional reserve estimates and structural interpretation. We plan to drill a minimum of 35 shallow (200 to 500 ft) NQ diamond core drill holes. During the summer months we plan to do a variety of surveying work which includes topographic surveys and establishment of more local survey control monuments for engineering purposes. Also, many of the formerly mentioned characterization studies will be continued through the summer months. Also, during the summer, we plan the procurement of necessary facility and system upgrades, as well as the acquisition of necessary equipment and the construction of a pilot mill facility. Currently we have a fully functioning all season enclosed 23 man camp with three functioning offices with computers and internet access. The camp has a STW treatment plant for sewage and graywater treatment. The camp site also has a large mechanics shop for working on heavy equipment such as backhoes and bulldozers. The camp also has multiple ADEC approved containments with tanks capable of storing 30,000 gallons of diesel fuel, and a peripheral explosives storage area. The camp also has an abundance of heavy equipment for excavating and road maintenance.

During the late fall of 2009, we plan to open our portal and begin the excavation of a decline to begin the extraction of the bulk sample. We plan to extract the majority of vein material from the ‘A’ Zone since more than 70% of the current reserve is in this zone. We plan to use a cut-and-fill stoping method. Once a stope is driven, the vein structure will be shot off the rib at an estimated width of 2 feet and mucked out for storage and processing at the surface. Waste rock will be temporarily stored on lined pads along the left limit Bench of Nolan Creek Valley, an area used previously by the Company for seasonal storage of bulk samples.

Currently, at the time of this writing, the Company’s engineers and geologists have designed the subsurface routes for an access decline and egress routes for the extraction of the bulk sample material, as well as located sites for temporary tailings storage and additional layout sites and mill design. The geologists have finished their geotechnical studies for engineering purposes. However, depending on various characterization studies and additional infill drilling results during 2009, the subsurface plan may be amended.

Readers and investors need to take caution, in that much of the work planned in 2009 is contingent upon available funding and the success and speed of the permitting process.

Our proposed drilling program for 2009 will be aimed at lode gold and antimony exploration. Lode drilling will focus on Pringle Bench, Workman’s Bench and the Hillside along the Solomon’s Shear trend, and is designed to provide a better three dimensional understanding of the mineralized sections of the structure and how it is related to the placer gold deposits of the Nolan Creek area. Since the Project is advancing into the development stage, exploration drilling will not be conducted in the Fortress area which is part of a gold bearing east-west trending deformation zone. The Company plans to drill a minimum of 35 shallow (200-500 ft) diamond core drill holes. Placer drilling will be dependent on funding for the extraction of the Workman’s Bench 1,000 cu yd bulk sample.

Workman’s Bench - The Company plans to infill drill a minimum of 20 holes along the portion of Solomon Shear Zone that was drilled in 2008, to further define and increase reserves.

Pringle South - The Company plans to infill drill a minimum of 10 holes along the Solomon Shear Zone on the north side of Smith Creek in the area between the Pringle and Workman’s Benches for a check of the continuity of the northeast striking zone.

Hillside Area - The bedrock underlying the Hillside Area was drilled in previous years with an RC drill, but the drilling locations were based on only limited bedrock trenching data. Since then, geophysical surveys and geochemical soil sampling surveys have indicated that the drill collars were too far west. The Company plans to select a minimum of 5 sites approximately 300 to 800 feet further to the east and drill back toward the west to intercept the zone. The Company plans to take advantage of the historic trails and use a backhoe to dig additional test trenches in the area further to the east.

The Total Cost for the Drilling Exploration Program is expected to be US $1,000,000.

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Our exploration plans are to further define gold deposits in order to provide a basis for the assessment of the feasibility of future additional test mining activities at the Nolan project. We are currently undertaking an extensive geological exploration program on the Nolan Gold Project. The program includes drilling and trenching, as well as the review of geological and geophysical data.

We have been working on interpreting the geology of the Nolan area since 1979, when we first acquired the project. Our latest and most extensive exploration program began in early 2007 and was directed at improving our placer deposit definition and discovering potential lode sources of the placer gold. Our exploration geologists and mining engineers have worked to move this objective forward. Our exploration efforts have included the analysis of geophysical data, geochemical sampling results, Company records and analysis provided by government mineral investigation efforts and publications as well as the trenching and exploration drilling of target areas.

We plan to spend up to$10,000,000 in the next twelve months in carrying out our exploration, permitting and development activities for the Nolan Gold Project. Of this amount, $1,000,000 is projected for lode drilling and trenching on the Solomon Shear Zone. The actual amount that we spend on exploration will depend on the actual amount of funds that we have available for exploration. We are presently seeking to obtain sufficient financing to enable us to proceed with these plans.

Effective January 1, 2009, we have economically viable reserves on our properties that comprise the Nolan Gold Project.. We plan to carry out activities on the Nolan Gold Project. The objective of the activities on the Nolan Gold Project is to complete permitting, drill, and continue underground development and bulk sampling and processing.

Ester Dome Property

During 2009, we plan to complete the closure of the Grant Mill Tailings Pond. This pond is filled to capacity, and will be capped and decommissioned after a final approval of the tailings pond closure plan is received from State of Alaska regulatory agencies. A meaningful exploration program may be completed during the summer months to explore for and identify small high-grade gold anomalies as well as larger low-grade gold anomalies.

Completing the 2009 exploration work plan will be contingent on available funding.

Hammond Property

The encouraging drill results to date, the potential of extending the Slisco Channel to the southeast plus the possibility of discovering gold bearing tributary channels, make this a prospect for additional discoveries. This project will require additional funding. Even if funding is acquired, there is no assurance that a commercial gold bearing placer deposit will be developed. Even if a gold bearing deposit is developed, additional funding will be required to mine the deposit, and until a feasibility study is completed, there is no assurance that the deposit will be profitable to mine.

Eagle Creek Property

During 2009, annual assessment work will be completed on the Eagle Creek property to keep the mining claims in good standing. Assessment work will be focused on the northwest part of the claim block, where drilling and trenching has defined an intrusive host rock, thought to be a sill, containing low grade gold, silver and antimony mineralization. If funding permits, the Company will design a drilling program to further investigate the gold and by-product mineral distribution of the intrusive. Additional work which includes trenching and drilling will also be completed on the Number One. The Number One Vein was the lode quartz structure which has been mined commercially for antimony.

A commercially viable economic mineral deposit has not been defined on the property, and there is no assurance that a commercially viable economic mineral deposit exists on the property.

Low-Rank Coal-Water Fuel Project

During late May of 2007 Silverado environmental staff met in a “pre-permitting” meeting with representatives of the Mississippi Department of Environmental Quality (“MDEQ”). At that meeting all the various sections of MDEQ that would be involved in the permitting of the Green Fuel industrial process were present, representatives of these sections were assigned to our project, and the lead MDEQ regulator that will serve as our point-of-contact was designated.

Silverado is currently having a $150,000 study conducted on the chemical and physical characteristics of Mississippi Red Hills Lignite Coal at the Mineral Industry Research Laboratory at the University of Alaska (Fairbanks) and expects results by late 2009.

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Results of the tests as well as capital availability and an increase in oil prices would all have to be present and sufficient for Silverado Green Fuel Inc. to reconsider construction of its LRCWF project. In the meantime, Dr. Warrack Willson, at age 65, has retired from Silverado Green Fuel and the Company retains its rights under its agreement with Dr. Willson to the LRCWF technology and exclusive rights to technology developed by Dr. Willson during his employment with Silverado.

During the year ended November 30, 2008, we have spent approximately $300,000 to fund the research into lignite coal conversion in conjunction with the University of Fairbanks, Alaska, referred to above, and the preparation of a Phase I feasibility study and cost estimate for the Mississippi Commercial Low Rank Coal Water Fuel plant.

Cash Requirements and Additional Financings

At November 30, 2008, the Company had a deficit working capital of $1,293,886 as compared to working capital of $1,741,698 as at November 30, 2007. During the first quarter of 2009 we raised $147,000 in additional share capital and received $135,000 subscription through private placements.. Our plan of mining operations in Alaska anticipates that we will expend $10,000,000 during fiscal year 2009. In addition, we expect to spend $100,000 on research and development for the Green Fuel project and approximately $2,000,000 on general and administrative costs in the Company’s Vancouver head office.

Our management is confident that they will be able to raise additional capital during the second, third and fourth quarters of Fiscal 2009 to cover the resulting anticipated shortfall of approximately $13,100,000. However, there is no assurance that we will be able to raise the financing necessary to enable us to implement our business plan.

Planned operations as described above could be curtailed if funding were not available.

CRITICAL ACCOUNTING POLICIES

Exploration Stage Company

The Securities and Exchange Commission’s Exchange Act Guide 7 “Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations” requires that mining companies in the exploration stage should not refer to themselves as development stage companies in their financial statements, even though such companies should comply with Financial Accounting Board Statement No. 7, if applicable. We are an exploration stage company under the SEC’s Guide 7 and accordingly, we have not been referred to as a development stage company in our financial statements. Accumulated results of operations are presented from December 1, 2001, the date we re-entered the exploration stage.

Mineral rights payments and exploration costs

Pursuant to EITF 04-02, “Whether Mineral Rights are Tangible or Intangible Assets and Related Issues”, the Company has modified its accounting policy with respect to mineral claim payments, retroactively effective to June 1, 2004, to capitalize the direct costs to acquire or lease mineral properties and mineral rights as tangible assets. The direct costs include the costs of signature (lease) bonuses, options to purchase or lease properties, and brokers’ and legal fees. If the acquired mineral rights relate to unproven properties, the Company does not amortize the capitalized mineral costs, but evaluates the capitalized mineral costs periodically for impairment. The Company expenses all costs related to the exploration of mineral claims in which it had secured exploration rights prior to establishment of proven and probable reserves.

Asset retirement obligation

Effective December 1, 2002, we adopted SFAS 143, Accounting for Asset Retirement Obligations, which addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated retirement costs. The standard applies to legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and normal use of the asset.

SFAS No. 143 requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The fair value of the liability is added to the carrying amount of the associated asset and this additional carrying amount is depreciated over the life of the asset. The liability is accreted at the end of each period through charges to operating expense. If the obligation is settled for other than the carrying amount of the liability, we will recognize a gain or loss on settlement.

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Stock Based Compensation

Effective December 1, 2006, the Company adopted the provisions of SFAS 123(R) (Share-based Compensation) requiring equity awards granted under its stock option plan to be accounted for under the fair value method. Accordingly, share-based compensation is measured at grant date, based on the fair value of the award. Prior to December 1, 2006, the Company accounted for awards granted under its stock option plans utilizing the intrinsic value method prescribed by Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees” (APB 25), and related interpretations, and provided the required pro forma disclosures prescribed by SFAS 123, “Accounting for Stock-Based Compensation” (SFAS 123), as amended. Under the existing stock option plans, all options vest entirely on the grant date. Therefore, there were no partially vested options outstanding as of the SFAS 123(R) adoption date.

OFF-BALANCE SHEET ARRANGEMENTS

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources, and that would be considered material to investors.

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ITEM 7. FINANCIAL STATEMENTS.

Our audited financial statements for the year ended November 30, 2008, as set forth below, are included with this Annual Report on Form 10-KSB. Our audited financial statements are prepared on the basis of accounting principles generally accepted in the United States and are expressed in U.S. dollars.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of Silverado Gold Mines Ltd.
(An Exploration Stage Company)

We have audited the accompanying consolidated balance sheets of Silverado Gold Mines Ltd. and Subsidiaries (An Exploration Stage Company) (the “Company”) as of November 30, 2008 and 2007, and the related consolidated statements of operations and other comprehensive gain (loss), stockholders’ equity, and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. Our opinion on the consolidated statements of operations and other comprehensive gain (loss), stockholders’ equity, and cash flows for the period since recommencement of the exploration stage from December 1, 2001 to November 30, 2008 insofar as it relates to amounts for the prior periods through November 30, 2004 is based on the reports of other auditors.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Silverado Gold Mines Ltd. and Subsidiaries (An Exploration Stage Company) as of November 30, 2008 and 2007, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company’s dependence on outside financing, lack of sufficient working capital, and recurring losses from activities in the exploration stage raises substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Berkovits & Company, LLP
 
Fort Lauderdale, Florida
March 6, 2009

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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS

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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS

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