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

FORM 10-KSB

(Mark One)

x Annual Report Pursuant To Section 13 Or 15(d) Of The Securities Exchange Act Of 1934

For the fiscal year ended December 31, 2005

¨ Transition Report Under Section 13 Or 15(d) Of The Securities Exchange Act Of 1934

For the transition period from __________ to __________

COMMISSION FILE NUMBER: 000-30995

SEARCHLIGHT MINERALS CORP.
(Name of small business issuer in its charter)

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

Securities registered under Section 12(g) of the Exchange Act:

SHARES OF COMMON STOCK, $0.001 PAR VALUE PER SHARE

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 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes x No ¨

Check 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 $NIL

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by
reference to the price at which 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. (See definition of affiliate in Rule 12b-2 of the Exchange Act.)
$14,413,398 as of December 30, 2005.

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable
date. 57,275,000 Shares of Common Stock as of April 14, 2006.

Transitional Small Business Disclosure Format (check one): Yes ¨ No x

ANNUAL REPORT ON FORM 10-KSB
FOR THE YEAR ENDED DECEMBER 31, 2005

INDEX

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GLOSSARY OF TECHNICAL TERMS

The following defined technical terms are used in this Annual Report on Form 10-KSB:

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PART I

ITEM 1.                DESCRIPTION OF BUSINESS.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this Annual Report on Form 10-KSB constitute "forward-looking statements". These statements, identified by words such as “plan”, "anticipate", "believe", "estimate", "should," "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption "Management's Discussion and Analysis or Plan of Operation" and elsewhere in this Form 10-KSB. We advise you to carefully review the reports and documents we file from time to time with the Securities and Exchange Commission (the “SEC”), particularly our quarterly reports on Form 10-QSB and our current reports on Form 8-K.

As used in this Annual Report, the terms "we", "us", "our", “Searchlight”, and the “Company” mean Searchlight Minerals Corp., unless otherwise indicated. All dollar amounts in this Annual Report are expressed in U.S. dollars unless otherwise indicated.

Introduction

We are an exploration stage company engaged in the acquisition and development of mineral properties. We have entered into mineral option agreements to acquire an interest in 20 mineral claims (the “Searchlight Claims”) representing an area of 3,200 acres located in Clark County, south of Searchlight, Nevada. On October 24, 2005, we acquired an interest in a joint venture agreement (the “JV Agreement”) dated May 20, 2005 between Nanominerals Corp. and Verde River Iron Company, LLC, a Nevada limited liability company (“Verde”) pursuant to which we have the option to acquire up to 50% of the Clarkdale Slag Project. The JV Agreement was entered into for the purpose of funding the processing of a copper smelter slag pile located on a parcel of land consisting of approximately 200 acres in Clarkdale, Arizona (the “Clarkdale Slag Project”). The slag contained on the Clarkdale Slag Project site was produced as smelter rejects from prior processing of copper from 1915-1952. Upon completion of a drilling and sampling program to determine if the project is feasible, we intend to re-process the slag pile using an extraction process developed using industry standard metallurgy. We acquired our interest in the Clarkdale Slag Project pursuant to an assignment agreement with Nanominerals Corp. dated for reference June 1, 2005, as amended August 31, 2005 and October 24, 2005, pursuant to which Nanominerals assigned all of its interest in the JV Agreement to us.

We have not earned any revenues to date and do not anticipate earning revenues until such time as we enter into commercial production of our mineral properties. Our current plan of operation is to conduct mineral exploration activities on the Searchlight Claims in order to assess whether they possess mineral reserves capable of commercial extraction and drilling and sampling activities on the Clarkdale Slag Project site in order to assess whether the slag possesses a mineral inventory capable of commercial extraction. The agreements pursuant to which we acquired our interests in the Searchlight Claims and Clarkdale Slag Project provide that we must make a series of cash payments over certain time periods, expend certain minimum amounts on the exploration of the properties or contribute Searchlight’s share of ongoing expenditures. If we fail to make such payments or expenditures in a timely fashion, we may lose our interest in those properties.

Corporate History

Searchlight was incorporated on January 12, 1999 pursuant to the laws of the State of Nevada under the name L.C.M. Equity, Inc. (“LCM”). From 1999 to 2005 Searchlight operated primarily as a biotechnology

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research and development company with its headquarters in Canada and an office in the UK. On November 2, 2001, LCM entered into an acquisition agreement with Regma Bio Technologies, Ltd. ("Regma") pursuant to which Regma entered into a reverse merger with LCM with the surviving entity named “Regma Bio Technologies Limited”. On February 2, 2004 we changed our name to “Phage Genomics, Inc.”

In February, 2005, we announced the reorganization of Searchlight from a biotechnology research and development company to a company focused on the development and acquisition of mineral properties. In connection with Searchlight’s reorganization we entered into mineral option agreements to acquire an interest in the Searchlight Claims. Also in connection with Searchlight’s corporate restructuring, our board of directors approved a change of Searchlight’s name to "Searchlight Minerals Corp.” The name was changed to “Searchlight Minerals Corp.” effective June 23, 2005. Also during 2005 we restructured our board of directors which presently consists of Carl. S. Ager, Ian McNeil, Ian Matheson, and Robert McDougal. Effective October 7, 2005, K. Ian Matheson resigned as the Chief Executive Officer, Chief Financial Officer, President, Secretary and Treasurer of Searchlight. Mr. Matheson continues to serve as a member of the Board of Directors. In place of Mr. Matheson, Ian R. McNeil was appointed as our Chief Executive Officer and President and Carl Ager was appointed as our Chief Financial Officer, Secretary and Treasurer.

Recent Corporate Developments

We have experienced the following significant developments since our fiscal third quarter ended September 30, 2005:

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SEARCHLIGHT AND CLARKDALE PROJECTS

We hold interests in two mineral projects, as described below:

Our plan of operation for each of our groups of mineral properties is discussed below:

Searchlight Claims

The properties comprising the Searchlight Claims and our exploration, mining and development activities on the Searchlight Claims are discussed in detail under the heading “Description of Properties” in this Annual Report.

Our current plan of operation is to continue to conduct mineral exploration activities on the Searchlight Claims in order to assess whether they possess mineral reserves capable of commercial extraction. The agreements pursuant to which we acquired our interests in the Searchlight Claims provide that we must make a series of stock and lease payments over certain time periods, expend certain minimum amounts on the exploration of the properties or contribute Searchlight’s share of ongoing expenditures. If we fail to make such payments or expenditures in a timely fashion, we may lose our interest in those properties.

We have developed an exploration work program for the Searchlight Project. We filed a surety bond in the amount of $27,528 for Phase I and $153,031 for Phase II with the Bureau of Land Management, and have commenced the two phase exploration program approved in connection with the terms of our reclamation permit, see “Searchlight Project and Reclamation Permit”, below. During the year ended December 31, 2005, metallurgical studies have been performed on the Searchlight Project site. Chain of custody (COC) surface samples and bulk samples (6 tons) have been taken from the project area by Arrakis, Inc. Metallurgical and analytical analysis on the samples has begun and results are expected in the second quarter of 2006. Once the results from the aforementioned analysis are reviewed, the next steps on the project will begin. These steps may include a drilling program on the claim area (we are permitted for 18 drill holes), more bulk testing (we are permitted for a 36 acre pit), surface sampling, and metallurgical analysis.

Clarkdale Slag Project

The properties comprising our Clarkdale Slag project are discussed in detail under the heading “Description of Properties” in this Annual Report. Our current plan of operation is to continue to conduct drilling and sampling activities on the slag pile located on the Clarkdale Slag Project site in order to assess whether the slag possesses mineral inventory capable of commercial extraction. In the fall of 2005, drilling commenced on the Clarkdale Slag Project under the chain-of-custody (COC) of Mountain States R&D International Inc. (“MSRDI”). A total of 9 holes and 675 feet were drilled. Sample preparation and analysis of the initial drill hole material has begun and is also being done under COC by MSRDI.

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Metallurgical and analytical analysis on the samples were received in March and April 2006. See “Description of Property – Clarkdale Slag Project” below.

Once the results from the drill program are fully analyzed, planning for the next steps on the project will begin. These next steps may include more drilling, analytical work, and testing of material on a larger scale (such as a test plant). At such time that we deem appropriate, a Bankable Feasibility Study will be undertaken.

COMPETITION

We are an exploration stage company. We compete with other mineral resource exploration and development companies for financing and for the acquisition of new mineral properties. Many of the mineral resource exploration and development companies with whom we compete have greater financial and technical resources than 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 greater 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 and development. 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.

COMPLIANCE WITH GOVERNMENT REGULATION

Our Searchlight Claims are comprised of non-patented placer mining claims located on federal land managed by the U.S. Bureau of Land Management. Mining activities on the Searchlight Claims must be carried out in accordance with a permit issued by the Bureau of Land Management. Mining activities on the Searchlight Claims are currently being carried out under a permit approved by the Bureau of Land Management under a 2005 plan of operation for mining activity submitted by us to the Bureau of Land Management. See “Searchlight Project and Reclamation Permit” below.

Our operations on the Clarkdale Slag Project will also require compliance with applicable permits under Arizona State law and require some upgrade of existing facilities as the project develops. Air quality and building permits have yet to be received on the Clarkdale Slag Project. URS Corp., an international engineering company has been involved with the permitting of the project with state and local authorities.

Permit applications are submitted under a tri-agency application, and are reviewed by agencies of the State of Nevada and State of Arizona governments, including the Department of Natural Resources, the Department of Environmental Conservation, and Fish and Game. We post a reclamation bond annually in an amount required by the State of Nevada for each acre of proposed disturbance exceeding reclaimed acreage in a permit period. Presently, we have posted the appropriate bonding, and as a matter of company policy, endeavor to reclaim disturbed areas to equal or exceed any new disturbance.

Our mining operation is regulated by Mine Safety Health Administration (“MSHA”). MSHA inspectors periodically visit our project to monitor health and safety for the workers, and to inspect equipment and installations for code requirements. All of our workers have completed MSHA safety training and must take refresher courses annually when working on our project. A safety officer for the project is also on site.

Other regulatory requirements monitor the following:

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Federal Claim Maintenance Fees

In order to maintain our Searchlight Claims each year we must pay a maintenance fee of $125 per claim to the Nevada State Office of the Bureau of Land Management and on November 1 of each year we must file an affidavit and Notice of Intent to Hold the claims in Clark County. We have paid the required maintenance fees and filed the affidavits required in order to extend the claims to August 31, 2006.

RESEARCH AND DEVELOPMENT EXPENDITURES

We have expended $186,877 over the past two fiscal years ended December 31, 2005 on research and development. We expended $887,023 on mineral exploration expenses in connection with our exploration programs on the Searchlight Project and Clarkdale Slag Project during fiscal 2005.

EMPLOYEES

We have no employees other than Carl S. Ager and Ian McNeil, each of whom are officers of Searchlight members of Searchlight’s board of directors. See “Executive Compensation - Employment Contracts” below.

SUBSIDIARIES

We have no subsidiaries.

PATENTS, TRADEMARKS, LICENSES AND ROYALTY AGREEMENTS

We do not own, either legally or beneficially, any patent or trademark and we are not party to any licensing agreements. Pursuant to the terms of our assignment agreement with NMC dated for reference June 1, 2005, as amended August 31, 2005 and October 24, 2005, we are required to pay NMC a royalty equal to 5% of the Net Smelter Returns (as defined in the Amended Assignment Agreement) resulting from the processing and extraction of minerals from the Clarkdale Slag Project. See “Description of Property”, below.

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ITEM 2.                DESCRIPTION OF PROPERTY.

We currently do not own any real property. We have an interest in the two groups of properties comprising our Clarkdale Slag project and Searchlight project discussed below.

On September 6, 2005, we entered into lease agreement with Burnett & Williams, LLC, a Nevada limited liability company (“B&W”) for the lease of our head office consisting of approximately 750 square feet located at Suite 120-2441 W. Horizon Ridge Parkway, Henderson NV 89052 at a rate of $3,100 per month. The lease is for a term of six months commencing September 15, 2005. The lease term is renewable at our option for a further six months on the same terms and conditions.

CLARKDALE SLAG PROJECT

Location, Access and History of Exploration

The Clarkdale Project is located at Clarkdale, Arizona, USA some 107 miles north of Phoenix and about 50 miles southwest from Flagstaff, Arizona, see Figure 1, below. The project is located at 3,480’ elevation on 198.7 deeded acres of industrial zoned land near the town of Clarkdale (3600 residents). It contains the old smelter site and an estimated 30,000,000 ton slag pile of which 20,000,000 tons are available for processing pursuant to the terms of our JV Agreement. The slag was produced as smelter rejects from processing copper ores, principally from Jerome, during the period 1915-1952, when the Clarkdale smelter was one of the largest copper smelters in the world. Jerome, some 6 miles west of Clarkdale at elevation 5,435’, is a historic mining district, which produced fortunes in copper extracted from massive sulfide deposits mined at Jerome (1889-1952) and smelted at both Jerome (1889-1915) and Clarkdale (1915-1952).

Improvements in technology over the last 50 years have now advanced to the point where re-processing of the slag at Clarkdale for gold, silver, copper, zinc, iron and ferro-silicates may be considered economic. What remains is to drill prove the mineral inventory and to complete a test module of the process. If the feasibility study confirms the work to date, then the joint venture expects to build a 2,000 ton per day (720,000 tons per year) extraction facility at Clarkdale. The capital requirements to complete the testing and to build and start up the operation are estimated at $31,000,000. It is expected that this facility can be expanded to 4,000 tons per day after initial production in which case it would have a minimum 15 year project life.

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Figure 1 - Clarkdale Slag Project Site

Acquisition of Clarkdale Slag Project

We entered into an assignment agreement with Nanominerals Corp. (the “Assignment Agreement”), a Nevada Corporation dated for reference June 1, 2005, as amended August 31, 2005 pursuant to which NMC assigned all of its interest in the JV Agreement to us. The JV Agreement was entered into for the purpose of funding the processing of a copper smelter slag located on a parcel of land consisting of approximately 200 acres in Clarkdale, Arizona.

On October 24, 2005, we entered into an amendment (the “Amended Assignment Agreement”) to the Assignment Agreement, for the purpose of clarifying Searchlight’s obligation to pay NMC a royalty equal to 5% of the Net Smelter Returns (as defined in the Amended Assignment Agreement) resulting from the processing and extraction of minerals from the Clarkdale Slag Project. Pursuant to the terms of the Amended Assignment Agreement, we completed the acquisition of all of NMC’s interest in the JV

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Agreement and fulfilled our obligations under the terms and conditions of the Assignment Agreement, which included the following conditions:

Following our acquisition of NMC’s interest in the Clarkdale Slag Project, we are presently proceeding with the joint venture with Verde, see Figure 2 – Clarkdale Joint Venture Structure, below. Under the terms of the JV Agreement, we intend to form a jointly owned limited liability operating company (“OPCO”) to pursue a four phase work program for the purpose of processing up to 2/3 or 20,000,000 tons minimum of slag from a copper smelter slag pile located at the Clarkdale Slag Project site, to extract byproducts from the slag for commercial resale. Pursuant to the terms of the JV Agreement, we have the option to earn a 50% interest in the Clarkdale Slag Project subject to the following, payments and conditions:

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Figure 2 - Clarkdale Joint Venture Structure

Clarkdale Slag Pile

The slag pile occupies approximately 45 acres and is up to 100 feet thick. Smelter records of the slag produced at Clarkdale (1915-1952) have indicated that at least three types of slag were poured onto the pile to make up the inventory of an estimated 30,000,000 tons.

The SEM data indicates that there is a variation due to the varying amount of sulfides contained within the different types of smelter sourced slag in the pile, to variations in liberation by different grinders, and to variations in the extraction processes used to report these metals. It is for all these reasons that care will be exercised in determining the extractable grade for the pile during the drilling and inventory study by the joint venture’s independent engineers.

Drilling, assaying and extraction testing of the slag pile by independent engineers commenced in June 2005 (Phase 1 = Inventory Study). The 20,000,000 ton reserve has a project life of 28 years at 2,000 tons per day and greater than 14 years at 4,000 tons per day.

Metallurgy

Grinding, assaying, leach and extraction testing (1991-2005) of composite bulk samples from the slag pile (>200 sites) has indicated that the copper, zinc, gold and silver are readily extractable by standard known technology, see Figure 3 below. The tails are ferro-silicates, saleable as cement additives to the local cement plant and other users.

The slag is environmentally inert and there are no known environmental issues currently at the Clarkdale site. The processing facility is expected to be zero discharge as it will recycle all water and it is expected to sell or to dispose of all products off-site. Certification of the process design and metal extraction will be

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determined during operation of the 2 ton per hour (tph) test module in support of the Bankable Feasibility Study (Phase 2) for a 2,000 ton per day operation at Clarkdale.

There are many advances in technology over the last ten years that have made the slag pile more economically desirable. There are two significant improvements worth mentioning. The first is the development of new mills capable of grinding the hard and abrasive slag found at Clarkdale. These mills use tougher ceramic components, rather than standard steel, are more cost efficient due to lower power requirements and can liberate the metals for extraction, even from tough materials such as the Clarkdale slag.

The second improvement is the advancement of Ion-Exchange resin technology. Ion-Exchange resins are designated to replace current solvent extraction liquids because they are environmentally benign. These man-made collectors can selectively recover, with pin-point accuracy, specific metals and/or compounds. This eliminates the costs and environmental problems associated with previously used circuits for Copper/Zinc recovery. Use of Ion-Exchange resins is common in commercial mining operations around the world.

Figure 3 – Extraction Method

Capital Costs

The process design and equipment selection are well advanced for both an initial 2 ton per hour (test module) and a potential 2,000 ton per day (720,000 tons per year) leach and extraction plant at Clarkdale. All required buildings and services are currently available (with moderate cost upgrades) at the site. These include office, lab and processing buildings as well as road, rail, power, telephone, water, storm drain and

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sewage. Expansion to 4,000 tons per day is anticipated to occur as soon as practical, to be financed by Searchlight and OPCO from cash flow.

A conditional use permit has been obtained from local authorities subject to final site plan approval. Operations will require some upgrade of existing facilities as the project develops. Air quality, water quality and building permits have yet to be received. URS Corp., an international engineering company has been involved with the permitting of the Clarkdale Slag Project with state and local authorities.

The Mineral Inventory Study (Phase 1) will include drilling to verify the grade and reserves. The Bankable Feasibility Study (Phase 2) will include additional metallurgical tests and a two ton per hour test module to confirm the plant design. Once this work is completed, Construction and Start Up (Phase 3) is estimated to take one year.

Preliminary capital costs and estimated operating profits for both the initial 2,000 ton per day operation and the expansion to 4,000 ton per day operation are estimated as follows:

Current Status of Exploration of Clarkdale Slag Project

In the fall of 2005, drilling commenced on our Clarkdale Slag Project under chain-of-custody sampling by Mountain States R&D International Inc. (“MSRDI”). We drilled 9 holes (SD1-7, 11, 12) in the slag pile all under the supervision of MSRDI and adhered to strict chain of custody (COC). A total of 9 holes and 675 feet were drilled as part of a Minerals Inventory Study being conducted by MSRDI on our behalf. Sample preparation and analysis of the base metal results (Copper, Zinc and Iron) of the first two drill holes are provided below. The following results were reported to us by MSRDI.

SD1 Drill Hole (see Figure 4)

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SD2 Drill Hole (see Figure 4)

SD1-SD6 Drill Holes (see Figure 4)

Drilling Program

We retained Dr. Richard F. Hewlett as the Project Manager for its Clarkdale Slag Project. Under the guidance of Dr. Hewlett, we contracted Mountain States R&D International Inc. of Tucson, AZ, to execute a Minerals Inventory Study. MSRDI, under the direction of its president, Dr. Roshan Bhappu will guide the Minerals Inventory Study which will include drilling the slag pile to determine grade and tonnage.

The above results are the first results reported to us from MSRDI. MSRDI used standard fusion technique in analyzing the results from the first two drill holes. MSRDI performed the copper, zinc, and iron analysis using the fusion assay method, followed by atomic absorption (AA). Gold analysis was performed by Arrakis, Inc., under the chain-of-custody of MSRDI, using 4-acid total digestion followed by graphite furnace atomic absorption (GFAA). Ten foot interval assays for SD1-SD6 as well as assays from SD-7, SD-11 and SD-12 are currently being prepared by MSRDI and are expected to follow, along with silver (Ag) assays for each drill hole.

We intend to resume the drilling program following the receipt and analysis of the first nine drill holes. Once the results from the drill program are fully analyzed, planning for the next steps on the project will begin. These next steps may include more drilling, analytical work, and testing of material on a larger scale (such as a test plant). At such time that we deem appropriate, a bankable feasibility study will be undertaken.

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Figure 4 –Drilling Program Map

SEARCHLIGHT CLAIMS

Location, Access and History of Exploration

The Searchlight Project is a 3,200-acre placer gold project, with underlying hard rock potential, located about 50 miles south of Las Vegas and 2 miles south of Searchlight, Nevada. See Figure 5, below. Access is by vehicle from Highway 95. The mining claims were staked by the owners on Federal land (BLM) as 160-acre association placer mining claims. Searchlight has a four year option to acquire these claims subject to certain terms and conditions. The claims consist of unpatented placer mining claims.

The Searchlight Claims are located in parts of Sections 1, 12-13 and 24-25 of Township 29 South, Range 63 East and Sections 19 and 30 of Township 29 South, Range 64 East Clark County Nevada. The names of the claims and their federal serial numbers are as described below:

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The Searchlight District is a well known gold camp. Mining occurred here during the period 1900-1950 where some 250,000 ounces of gold was produced from quartz-sulphide-hematite veins to depths of greater than 1,000 feet with minor placer gold produced. Exploration work by the claim owners on the Searchlight Project, during the period 1989-2005, indicated a potential for gold mineralization within the claim block. Sampling here has indicated extracted gold is very fine gold (<20 microns). Recent work by Searchlight has indicated the presence of gold from screened (-1/4”) surface samples taken from the central part of the claims. The claim owners have an approved Plan of Operation with the BLM for drilling 18 test holes throughout the claim block and for mining a 36 acre pit on the RR304 claim. The intent of the exploration work program outlined in this report is to identify the grade, tonnage and extractability of the gold within the Searchlight Project area. Independent geologists and engineers have been engaged to certify the work. Budget for this work (Phase 1) is projected at $650,000. Additional bulk leaches and drilling will be undertaken to define reserves for a mining feasibility study (Phase 2) should this work prove successful.

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Figure 5 – Searchlight Project Location

Acquisition of Searchlight Claims

On February 10, 2005, we entered into option agreements (the “Option Agreements”) with the owners (collectively the “Claim Owners”) of the Searchlight Claims. Prior to entering into the Option Agreements with Searchlight, each Claim Owner optioned its interest in the Searchlight Claim it owned to Searchlight Minerals, Inc. (“SMI”), a company controlled by K. Ian Matheson. Under the terms of the Option Agreements, each Claim Owner and SMI acknowledged and agreed, among other things, to the following (the “Acknowledgements”):

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In consideration of the Acknowledgments, Searchlight agreed, among other things to: (i) complete a corporate restructuring of its business by March 31, 2005 (the “Restructuring Date”); (ii) include any shares of its common stock issued to the Claim Owners in any subsequent registration statement filed by Searchlight under the Securities Act; (iii) make all regulatory or government payments required to maintain the Searchlight Claims in good standing during the term of the agreement, and (iv) issue to the Claim Owners an aggregate of 5,600,000 (post-split) restricted shares in the common stock of Searchlight in the following manner:

We will not acquire title to the Searchlight Claims until we complete the issuance of shares of our common stock to each Claim Owner in accordance with the terms of the Option Agreements.

Searchlight Project and Reclamation Permit

The intent of the 2006 Searchlight Project exploration work program is to drill 18 exploratory holes and test and develop a 36 acre pit to determine if there is mineralized material on the property. We expect to rent a drill rig and employ drillers to conduct the drilling. Independent geologists and engineers are expected to be engaged to certify the work. Budget for this work is estimated to cost approximately $650,000.

On April 22, 2005, we received a reclamation permit from the Nevada Bureau of Mining Regulation and Reclamation (“BMRR”) for our proposed work program on certain of the Searchlight Claims. Pursuant to the terms of the reclamation permit, we received the authorization to proceed with the reclamation of the mine located on the Rio Raga 304 claim and to pursue our planned exploration program on certain of our claims, in the following manner:

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The permit is valid for the life of the project and becomes effective upon receipt of an acceptable surety by the BMRR. We agreed, upon receipt of additional financing, to post by July 3, 2005 the surety bond for the approved two phase exploration program. We posted a cash bond in the amount of $180,500 with the Nevada Bureau of Land Management (“BLM”), in accordance with the terms of our reclamation permit for the Searchlight project granted by the Nevada Bureau of Mining Regulation and Reclamation on April 22, 2005.

In accordance with the terms of our reclamation permit for the Searchlight Project, metallurgical studies have been performed on the Searchlight Project site. Chain of Custody surface samples and bulk samples have been taken from the project area and analytical work on the samples has begun. We expect some preliminary results of the Searchlight Project samples by mid 2006.

Geology

The Searchlight Project is located over a north-south basin filled with unconsolidated detritus and bounded by outcropping Miocene volcanic and intrusive rocks. Outcrops of basement Precambrian gneiss indicate considerable uplift has occurred. Interpretation of satellite infrared images indicates a major east-west Fracture Zone, some six miles wide, cross-cuts the basin underling the Project area.

The gold at Searchlight was mined principally from quartz-sulphide-hematite veins that trended east-west. This is clearly related to the above mentioned Searchlight-Mammoth Fracture Zone. Detritus fill and hydrothermal overprints are postulated to be the source of the ultra fine gold (<20 microns) found underlying the Project area.

Metallurgy

Previous work on the Searchlight Project has shown that the gold occurs as minute particles in both the detritus grains and in the hydrothermally derived precipitates, which overprints the valley fill. It has taken years of research to develop extraction methods capable of dealing with this unique mineralogy.

During 2004-05 some 34 surface samples were analyzed for gold by the property owners on material collected from surface sites. At each sample site some 10 kg (22lbs) of –1/4” screened material was collected and split into 200-1000g samples for testing. Each sample was then prepared for assay. This included drying, grinding, blending, etc. Normally 15-30g samples were fire assayed with gravimetric finish for final results.

Preliminary statistical analysis of the data from this work indicates the high variance of fire assay extraction is directly correlated to the sample preparation method and/or the small sample size used. Historical data on the Project indicates that leach tests on larger samples are a more reliable analytical method than fire assaying of small samples.

For these reasons and to verify the property owners’ results, an independent metallurgical testing firm was retained to take chain of custody samples (COC), to test the samples for precious metals, to determine extractable grades by leaching large samples (500–1,000g), and to report on the results.

The firm selected to do this work was Arrakis, Inc. (“Arrakis”) of Denver, Colorado. Leach tests by Arrakis have confirmed the presence of extractable gold at the locations sampled. Additional tests are in progress from these surface samples sites.

Work Program of Searchlight Claims

The initial work program (Phase 1) for the Searchlight Claims will focus on analysis of surface samples to determine the best method to extract precious metals from this material for the drill program. Extraction tests on several COC surface samples are in progress at Arrakis. After this work is completed, a 18-hole drill program will be undertaken by independent engineers to determine the tonnage and extractable grades from the property. Should these results prove favorable, then Phase 2 will consist of infill drilling,

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bulk sampling and pilot leach tests to determine the commercial feasibility of the project. The scope and cost of Phase 2 will be determined after Phase 1 is complete.

The proposed program, cost and schedule for Phase 1 are as follows:

Current Status of Exploration of Searchlight Claims

We filed a surety bond in the amount of $27,528 for Phase I and $153,031 for Phase II with the BLM, and have commenced the two phase exploration program approved in connection with the terms of our reclamation permit. During the year ended December 31, 2005, metallurgical studies have been performed on the Searchlight Project site. Chain of custody (COC) surface samples and bulk samples (6 tons) have been taken from the project area by Arrakis, Inc. Metallurgical and analytical analysis on the samples has begun and results are expected in the second quarter of 2006. Once the results from the aforementioned analysis are reviewed, the next steps on the project will begin. These steps may include a drilling program on the claim area (we are permitted for 18 drill holes), more bulk testing (we are permitted for a 36 acre pit), surface sampling, and metallurgical analysis.

ITEM 3.                LEGAL PROCEEDINGS.

None.

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

None.

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PART II

ITEM 5.                MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Our shares are currently trading on the Over-The-Counter Bulletin Board under the symbol “SRCH”. The high and the low bid prices for our shares for the last two fiscal years of actual trading, as quoted in the over-the-counter bulletin board, as applicable, were:

The trades reflect inter-dealer prices, without retail mark-up, markdown or commission and may not represent actual transactions.

Holders of Our Common Stock

As of the date of this Annual Report, we have 142 registered stockholders.

Dividends

There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:

We have not declared any dividends and we do not plan to declare any dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

Since our previous fiscal year ended December 31, 2004, we have completed the following unregistered sales of our securities:

23

24

25

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

Plan Of Operation

In 2005, we announced the reorganization of Searchlight from a biotechnology research and development company to a company focused on the development and acquisition of mineral properties. In connection with Searchlight’s reorganization we entered into mineral option agreements to acquire an interest in the Searchlight Claims and acquired an interest in the Clarkdale Slag Project through our assignment agreement with NMC. Our current plan of operation is to continue to conduct mineral exploration activities on the Searchlight Claims and drilling and sampling activities for the Clarkdale Slag Project to assess whether the slag possesses a mineral inventory capable of commercial extraction. The agreements pursuant to which we acquired our interests in the Searchlight Claims and Clarkdale Slag Project provide that we must make a series of cash payments over certain time periods, expend certain minimum amounts on the exploration of the properties or contribute Searchlight’s share of ongoing expenditures. If we fail to make such payments or expenditures in a timely fashion, we may lose our interest in those properties.

Searchlight Project

The properties comprising the Searchlight Claims and our exploration, mining and development activities on the Searchlight Claims are discussed in detail under the heading “Description of Properties” in this Annual Report. Our current plan of operation is to conduct mineral exploration activities on the Searchlight Claims in order to assess whether they possess mineral reserves capable of commercial extraction. We have developed an exploration work program for the Searchlight Project. We filed a surety bond in the amount of $27,528 for Phase I and $153,031 for Phase II with the BLM, and have commenced the two phase exploration program approved in connection with the terms of our reclamation permit. During the year ended December 31, 2005, metallurgical studies have been performed on the Searchlight Project site. Chain of custody (COC) surface samples and bulk samples (6 tons) have been taken from the project area by Arrakis, Inc. Metallurgical and analytical analysis on the samples has begun and results are expected in the second quarter of 2006. Once the results from the aforementioned analysis are reviewed, the next steps on the project will begin. These steps may include a drilling program on the claim area (we are permitted for 18 drill holes), more bulk testing (we are permitted for a 36 acre pit), surface sampling, and metallurgical analysis.

Clarkdale Slag Project

The properties comprising our Clarkdale Slag project are discussed in detail under the heading “Description of Properties” in this Annual Report. Our current plan of operation is to conduct drilling and sampling activities on the slag pile located in the Clarkdale Slag Project site in order to assess whether the slag possesses mineral inventory capable of commercial extraction. In the fall of 2005, drilling commenced on the Clarkdale Slag Project under the chain-of-custody (COC) of Mountain States R&D International Inc. (MSRDI). A total of 9 holes and 675 feet were drilled. Sample preparation and analysis of the drill hole material has begun and is also being done under COC by MSRDI. Once the results from the drill program are fully analyzed, planning for the next steps on the project will begin. These next steps may include more drilling, analytical work, and testing of material on a larger scale (such as a test plant). If appropriate, a bankable feasibility study will be undertaken.

26

Cash Requirements

Our estimated expenses for the next twelve months are as follows:

We recorded a net operating loss before income taxes of $1,721,777 for the year ended December 31, 2005 and have an accumulated deficit of $5,755,108 since inception. As at the date of this Annual Report we had cash of approximately $1,400,000 and for the next twelve months, management anticipates that the minimum cash requirements to fund our proposed exploration program and our continued operations will be $5,050,000. Accordingly we do not have sufficient funds to meet our planned expenditures over the next twelve months and will need to seek additional financing to meet our planned expenditures. See “Future Financings”, below.

RESULTS OF OPERATIONS

Summary of Year End Results

27

Revenue

We are presently in the exploration stage of our business, have not earned any revenues to date, and do not anticipate earning revenues until such time as we enter into commercial production of the Clarkdale Slag Project, the Searchlight Claims or other mineral properties we may acquire from time to time.

Expenses

The major components of our expenses for the year are outlined in the table below:

We incurred operating expenses in the amount of $1,721,777 for the fiscal year ended December 31, 2005 as compared to $590,462 for the fiscal year ended December 31, 2004. Operating expenses increased by 191.6% as compared to fiscal 2004 largely due to the fact that: (i) we re-organized our business into that of a mining and exploration company during 2005 and had increased mineral exploration in connection with the acquisition of our interest in the Clarkdale Slag Project and Searchlight Project; (ii) our general and administrative expenses increased primarily due to increased professional fees associated with the completion of our private placements and the preparation of our registration statement on Form SB-2 and (iii) increased management fees; and (iii) increased stock compensation expenses of $399,782.

Liquidity and Financial Condition

28

The decrease in our working capital deficit from $1,685,366 as at December 31, 2004 as compared to a working capital deficit of $472,267 as at December 31, 2005 was primarily due to the increase in cash flows from financing activities of $2,690,807 from private placements of our securities completed during the year ended December 31, 2005.

Future Financings

Our plan of operation calls for significant expenses in connection with the exploration of the Searchlight Claims and drilling and sampling activities on the Clarkdale Slag Project which will require us to obtain additional financing. We recorded a net operating loss before income taxes of $1,721,777 for the year ended December 31, 2005 and have an accumulated deficit of $5,755,108 since inception. As at the date of this Annual Report we had cash of approximately $1,400,000 and for the next twelve months, management anticipates that the minimum cash requirements to fund our proposed exploration program and our continued operations will be $5,050,000. Accordingly we do not have sufficient funds to meet our planned expenditures over the next twelve months and will need to seek additional financing to meet our planned expenditures.

Obtaining additional financing would be subject to a number of factors, including the market prices for the mineral property and gold. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us. Since our inception, we have used our common stock to raise money for our operations and for our property acquisitions. We have not attained profitable operations and are dependent upon obtaining financing to pursue our plan of operation. For these reasons, our independent auditors believe there exists a substantial doubt about our ability to continue as a going concern.

Off-Balance Sheet Arrangements

None.

Critical Accounting Policies

We have identified certain accounting policies, described below, that are the most important to the portrayal of our current financial condition and results of operations.

Use of Estimates

In preparing the financial statements in conformity with accounting principles generally accepted in the United States, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from these estimates.

29

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over four years with the exception of leasehold improvements. Leasehold improvements are depreciated on a straight-line basis over the term of the lease.

Exploration Stage Company

The Company has been in the exploration stage since its restructuring and has not yet realized any revenues from its planned operations. The Company is primarily engaged in the acquisition and exploration of mining properties. Upon the location of commercially minable reserves, the Company plans to prepare for mineral extraction and enter the development stage.

Mineral Property Acquisition and Exploration Costs

The Company expenses all costs related to the acquisition and exploration of mineral properties in which it has secured exploration rights prior to establishment of proven and probable reserves. To date, the Company has not established the commercial feasibility of any exploration prospects; therefore, all costs are being expensed.

Depreciation, Amortization and Capitalization

The Company records depreciation and amortization when appropriate, using both straight-line and declining balance methods over the estimated useful life of the assets (five to seven years). Expenditures for maintenance and repairs are charged to expense as incurred. Additions, major renewals and replacements that increase the property's useful life are capitalized. Property sold or retired, together with the related accumulated depreciation, is removed from the appropriate accounts and the resultant gain or loss is included in net income.

RISKS AND UNCERTAINTIES

An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this Annual Report before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. The trading price of our common stock could decline due to any of these risks, and you may lose all or part of your investment.

We lack an operating history and have losses which we expect to continue into the future. As a result, we may have to suspend or cease exploration activities and if we do not obtain additional financing, our business will fail.

We were incorporated in January 12, 1999 and since that time were engaged in the business of biotechnology research and development. In February, 2005, we changed our business to mineral exploration. We have no exploration history upon which an evaluation of our future success or failure can be made. Our net loss since inception is $6,288,039, excluding other incomes and miscellaneous gains and losses. Our ability to achieve and maintain profitability and positive cash flow is dependent upon:

Our plan of operation calls for significant expenses in connection with the exploration of the Searchlight Claims and drilling and sampling activities on the Clarkdale Slag Project, which will require us to obtain additional financing. We recorded a net operating loss before income taxes of $1,721,777 for the year

30

ended December 31, 2005 and have an accumulated deficit of $5,755,108 since inception. As at the date of this Annual Report, we had cash of approximately $1,400,000 and for the next twelve months, management anticipates that the minimum cash requirements to fund our proposed exploration program and our continued operations will be $5,050,000. Accordingly we do not have sufficient funds to meet our planned expenditures over the next twelve months and will need to seek additional financing to meet our planned expenditures.

Obtaining additional financing would be subject to a number of factors, including the market prices for the mineral property and base and precious metals. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us. Since our inception, we have used our common stock to raise money for our operations and for our property acquisitions. We have not attained profitable operations and are dependent upon obtaining financing to pursue our plan of operation. For these reasons, our independent auditors believe there exists a substantial doubt about our ability to continue as a going concern.

Since this is an exploration project, we face a high risk of business failure due to our inability to predict the success of our business.

We have just begun the initial stages of exploration of our mineral claim, and thus have no way to evaluate the likelihood that we will be able to operate the business successfully. We were incorporated on January 12, 1999, and to date have been involved primarily in organizational activities, the acquisition of the mineral claim, obtaining a summary geological report and performing certain limited work on our mineral claim. We have not earned any revenues to date.

Because of the unique difficulties and uncertainties inherent in mineral exploration ventures, we face a high risk of business failure.

You should be aware of the difficulties normally encountered by new mineral exploration companies and the high rate of failure of such enterprises. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates. The expenditures to be made by us in the exploration of the mineral claim may not result in the discovery of mineral deposits. If funding is not available, we may be forced to abandon our operations.

Because we anticipate our operating expenses will increase prior to our earning revenues, we may never achieve profitability.

Prior to completion of our exploration stage, we anticipate that we will incur increased operating expenses without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from the exploration of the Searchlight Claims or the Clarkdale Slag Project, we will not be able to earn profits or continue operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide no assurance that we will generate any revenues or ever achieve profitability. If we are unsuccessful in addressing these risks, our business will most likely fail.

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

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

31

Our business is dependent on the price of base and precious metals. We have not undertaken hedging transactions in order to protect us from a decline in the price of base and precious metals. A decline in the price of base and precious metals may also decrease our ability to obtain future financings to fund our planned development and exploration programs.

Because of the inherent dangers involved in mineral exploration, there is a risk that we may incur liability or damages as we conduct our business.

The search for valuable minerals involves numerous hazards. As a result, we may become subject to liability for such hazards, including pollution and other hazards against which we cannot insure or against which we may elect not to insure. At the present time we have no coverage to insure against these hazards. The payment of such liabilities may have a material adverse effect on our financial position.

If we are unable to achieve economic re-processing of minerals from our Clarkdale Slag Project, then our financial condition and our revenues will be adversely affected.

We are currently undertaking drilling and sampling activities on the Clarkdale Slag Project site in order to assess whether the slag possesses a mineral inventory capable of commercial extraction. Once the results from the drill program are fully analyzed, we intend to undertake the next steps on the project. These next steps may include more drilling, analytical work, and testing of material on a larger scale (such as a test plant). At such time that we deem appropriate, a bankable feasibility study will be undertaken. There is no assurance that actual recoveries of base and precious metals or other minerals re-processed from the slag pile will be economically feasible. If metal recoveries are less than projected, then our metal sales will be less than anticipated and may not equal or exceed the cost of mining and recovery in which case our operating results and financial conditions will be adversely affected.

As we undertake exploration of the Searchlight Claims, we will be subject to compliance with government regulation that may increase the anticipated cost of our exploration program.

There are several governmental regulations that materially restrict mineral exploration. We will be subject to the laws of the State of Nevada and applicable federal laws as we carry out our exploration program on the Searchlight Claims. We are required to obtain work permits, post bonds and perform remediation work for any physical disturbance to the land in order to comply with these laws. While our planned exploration program budgets for regulatory compliance, there is a risk that new regulations could increase our costs of doing business and prevent us from carrying out our exploration program.

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

Our development and production operations are regulated by both US Federal and Nevada and Arizona state environmental laws that relate to the protection of air and water quality, hazardous waste

32

management and mine reclamation. These regulations will 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.

We have no known mineral reserves and if we cannot find any, we will have to cease operations.

We have no mineral reserves. Mineral exploration is highly speculative. It involves many risks and is often non-productive. Even if we are able to find mineral reserves on our property our production capability is subject to further risks including:

The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond our control and which cannot be accurately predicted, such as market fluctuations, the lack of milling facilities and processing equipment near the Searchlight Claims, the success of our drilling and sampling activities on the Clarkdale Slag Project and such other factors as government regulations, including regulations relating to allowable production, exporting of minerals, and environmental protection. If we do not find a mineral reserve or define a mineral inventory containing gold, silver, copper, zinc or iron or if we cannot explore the mineral reserve, either because we do not have the money to do it or because it will not be economically feasible to do it, we will have to cease operations and you will lose your investment.

As we undertake exploration of our mineral claims, we will be subject to compliance with government regulation that may increase the anticipated cost of our exploration program.

There are several governmental regulations that materially restrict mineral exploration. We are required to obtain work permits, post bonds and perform remediation work for any physical disturbance to the land in order to comply with these laws. If we enter the production phase, the cost of complying with permit and regulatory environment laws will be greater because the impact on the project area is greater. Permits and regulations will control all aspects of the production program if the project continues to that stage. Examples of regulatory requirements include:

There is a risk that new regulations could increase our costs of doing business and prevent us from carrying out our exploration program. We will also have to sustain the cost of reclamation and

33

environmental remediation for all exploration work undertaken. Both reclamation and environmental remediation refer to putting disturbed ground back as close to its original state as possible. Other potential pollution or damage must be cleaned-up and renewed along standard guidelines outlined in the usual permits. Reclamation is the process of bringing the land back to its natural state after completion of exploration activities. Environmental remediation refers to the physical activity of taking steps to remediate, or remedy, any environmental damage caused. The amount of these costs is not known at this time as we do not know the extent of the exploration program that will be undertaken beyond completion of the recommended work program. If remediation costs exceed our cash reserves we may be unable to complete our exploration program and have to abandon our operations. See “Description of Business - Compliance with Government Regulation”, below.

We may conduct further offerings in the future in which case your shareholdings will be diluted.

Since our inception we have relied on such equity sales of our common stock to fund our operations. We may conduct further equity offerings in the future to finance our current projects or to finance subsequent projects that we decide to undertake. If common stock is issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. If we issue additional stock, your percentage interest in us will be lower. This condition is often referred to as "dilution". The result of this could reduce the value of your stock.

Because our stock is a penny stock, stockholders will be more limited in their ability to sell their stock.

The Securities and Exchange Commission (the “SEC”) has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the Nasdaq system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or quotation system.

Because our securities constitute "penny stocks" within the meaning of the rules, the rules apply to us and to our securities. The rules may further affect the ability of owners of shares to sell our securities in any market that might develop for them. As long as the trading price of our common stock is less than $5.00 per share, the common stock will be subject to rule 15g-9 under the Exchange Act. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that:

34

The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with: (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statements showing the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitably statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our stock.

35

ITEM 7.                FINANCIAL STATEMENTS.

36

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors
of Phage Genomics Inc. (formerly Regma Bio Technologies Limited)
(A Development Stage Company)

We have audited the accompanying balance sheets of Phage Genomics Inc. (formerly Regma Bio Technologies Limited) (A Development Stage Company) as of December 31, 2004 and 2003, and the related statements of operations, stockholders' equity and cash flows for the period from January 14, 2000 (date of inception) to December 31, 2004 and the years ended December 31, 2004 and 2003. These 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.

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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates 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 financial statements referred to above presents fairly, in all material respects, the financial position of Phage Genomics Inc. (formerly Regma Bio Technologies Limited) (A Development Stage Company), as of December 31, 2004 and 2003, and the related statements of operations, stockholders' equity and cash flows for the period from January 14, 2000 (date of inception) to December 31, 2004 and the years ended December 31, 2004 and 2003, in conformity with generally accepted accounting principles used in the United States.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has losses from operations since inception, has not generated any revenue and has a significant working capital deficit. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also discussed in Note 1. These financial statements do not include any adjustments, which might result from the outcome of this uncertainty.

Chartered Accountants
Vancouver, Canada
April 11, 2005

F-1

PERSONAL FINANCIAL PLANNING,
BUSINESS SERVICES & TAX PLANNING

Report of Indedendent Registered Public Accounting Firm

To the Board of Directors
Searchlight Minerals, Inc.
Henderson, Nevada

We have audited the accompanying balance sheet of Searchlight Minerals, Inc. (an Exploration Stage Enterprise) as of December 31, 2005 and the related statements of operations, stockholders' equity, and cash flows for the year then ended and the period January 14,2000 (date of inception) through December 31, 2005. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Searchlight Minerals, Inc. (an Exploration Stage Enterprise) as of December 31, 2005 and the results of its operations and cash flows for the year ended December 31, 2005, in conformity with generally accepted accounting principles.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note I to the financial statements, the Company has losses from operations since inception, has not generated any revenue and has a significant working capital deficit. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also discussed in Note 1. These financial statements do not include any adjustments, which might result from the outcome of this uncertainty.

April 10, 2006
Las Vegas, Nevada
 

P.O. BOX 50329 HENDERSON, NEVADA 89016 PHONE: (702) 450-2200 FAX: (702) 436-4218
E-MAIL: ktingle@kyletinglecpa.com

F-2

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
BALANCE SHEETS

See Accompanying Notes to Financial Statements
F-3

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
STATEMENTS OF OPERATIONS

See Accompanying Notes to Financial Statements
F-4

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

See Accompanying Notes to Financial Statements
F-5

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

See Accompanying Notes to Financial Statements
F-6

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS

See Accompanying Notes to Financial Statements
F-7

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

F-8

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

F-9

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

F-10

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

F-11

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

Additionally, the Company entered into an amendment (the “Amended Assignment Agreement”) to the Assignment Agreement, for the purpose of clarifying the Company’s obligation to pay NMC a royalty equal to 5% of the Net Smelter Returns (as defined in the Amended Assignment Agreement) resulting from the processing and extraction of minerals from the Clarkdale Slag Project. As at October 24, 2005, the Company fulfilled its obligations under the terms and conditions of the Assignment Agreement.

F-12

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

F-13

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

Stock Options – During the year ended December 31, 2005 and 2004, the Company granted stock options to employees and directors totaling 2,500,000 and -0- shares of its common stock with a weighted average strike price of $0.36 and $ 0.00 per share, respectively. Certain stock options were exercisable upon grant and have a life of 5 years. As of December 31, 2005 stock option outstanding totaled 2,500,000 with a weighted average strike price of $0.36 per share.

F-14

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

The Company estimates the fair value of these options granted to the consultant by using the Binomial Lattice (Cox, Ross Rubenstein) option pricing-model with the following assumptions used for grants in 2005 using specific grant dates; no dividend yield; expected volatility of 85%; risk free interest rates of 3.65% to 4.39%; and expected lives of 5 years for all non-employee stock options. Accordingly, the Company valued the services under SFAS No. 123R relating to non-statutory stock options that became exercisable upon grant in 2005 for $399,782 as of December 31, 2005.

The following table summarizes information about options granted during the year ended December 31, 2005:

Stock options/warrants - During the year ended December 31, 2005, the Company granted stock warrants related to common stock issued through a private placement totaling 7,350,000 with a strike price of $0.52 per share. Additionally, stock warrants related to common stock totaling 1,768,500 were issued to underwriters of the private placement with a strike price of $0.625 per share. These value of the warrants were allocated against additional paid in capital as part of the overall offering cost of the private placement.

During the year ending December 31, 2005, the Company acquired the interest in a joint venture agreement, as discussed in Note 4, which included stock warrants for 12,000,000 shares of common stock, with a strike price of $0.375 per share.

F-15

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

Rental expense, resulting from operating lease agreements, approximated $17,230 for the years ended December 31, 2005.

Employment contracts – Ian R. McNeil. The Company entered into an employment agreement with Ian R. McNeil effective January 1, 2006. Pursuant to the terms of the agreement, Mr. McNeil is to be paid an annual salary of $108,000 and a bonus of $36,000 on execution of the agreement, in consideration of which Mr. McNeil agreed to act as the Company’s President and Chief Executive Officer. Mr. McNeil is also eligible for discretionary bonus to be determined based on factors considered relevant by the Company’s board of directors, and may be granted, subject to the approval of the board of directors, incentive stock options to purchase shares of the Company’s common stock in such amounts and at such times as the board of directors, in its absolute discretion, may from time to time determine. The term of the agreement is for an indefinite period, unless otherwise terminated pursuant to the terms of the agreement. In the event that the agreement is terminated by the Company other than for cause, the Company will provide Mr. McNeil with six months written notice or payment equal to six months of his monthly remuneration.

Carl S. Ager. The Company entered into an employment agreement with Carl S. Ager effective January 1, 2006. Pursuant to the terms of the agreement, Mr. Ager is to be paid an annual salary of $80,000 and a bonus of $26,666 on execution of the agreement, in consideration of which Mr. Ager agreed to act as the Company’s Treasurer and Secretary. Mr. Ager is also eligible for discretionary bonus to be determined based on factors considered relevant by the Company’s board of directors, and may be granted, subject to the approval of the board of directors, incentive stock options to purchase shares of the Company’s common stock in such amounts and at such times as the board of directors, in its absolute discretion, may from time to time determine. The term of the agreement is for an indefinite period, unless otherwise terminated pursuant to the terms of the agreement. In the event that the agreement is terminated by the Company other than for cause, the Company will provide Mr. Ager with six months written notice or payment equal to six months of his monthly remuneration.

F-16

SEARCHLIGHT MINERALS CORP.
(AN EXPLORATION STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS

F-17

ITEM 8.                CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

On May 18, 2005, we engaged Kyle L. Tingle, CPA, LLC (“KLT”), as our new independent registered public accounting firm, following the resignation of our prior independent registered public accounting firm, Manning Elliott, Chartered Accountants (“Manning Elliott”), which occurred on May 18, 2005.

Manning Elliott performed the audit of our financial statements for the years ended December 31, 2004 and 2003. During this period and the subsequent interim period through May 18, 2005, there were no disagreements with Manning Elliott on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements if not resolved to Manning Elliott’s satisfaction would have caused Manning Elliott to make reference to the subject matter of the disagreements in connection with Manning Elliott’s report, nor were there any "reportable events" as such term is defined in Item 304(a)(3) of Regulation S-B, promulgated under the Securities Exchange Act of 1934, as amended.

Manning Elliott’s decision to resign as our independent auditor was ratified by the our board of directors on May 18, 2005, and was made due to the fact that our operations and management are now in the United States and we are required to have a U.S. based independent auditor.

The audit reports of Manning Elliott for the years ended December 31, 2004 and 2003 did not contain an adverse opinion, or a disclaimer of opinion, or qualification or modification as to uncertainty, audit scope, or accounting principles, other than the uncertainty that we might not be able to operate as a going concern.

ITEM 8A.             CONTROLS AND PROCEDURES.

ITEM 8B.             OTHER INFORMATION.

None.

37

PART III

ITEM 9.                DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

Our executive officers and directors and their respective ages and titles as of March 17, 2006 are as follows:

Set forth below is a brief description of the background and business experience of our executive officers and directors for the past five years:

Ian R. McNeil. Mr. McNeil is a member of our board of directors and our CEO and President. Mr. McNeil has been involved in starting his own businesses and has worked in executive positions for both large and small companies. Since June of 2003, Mr. McNeil has been president of Nanominerals Corp. Mr. McNeil graduated with a Bachelor of Commerce degree from the University of Victoria in 1996.

Carl S. Ager. Mr. Ager is a member of our board of directors and our Chief Financial Officer, Secretary and Treasurer. In 1997, Mr. Ager obtained his Bachelor of Applied Sciences – Engineering Geophysics degree from Queen’s University in Kingston, Ontario. Since January, 2003, Mr. Ager has been President of CSA Management Corp, a private Nevada corporation which provides consulting services to mineral exploration companies. Mr. Ager has also served as Vice President of Nanominerals Corp since June 2003.

Robert D. McDougal. Mr. McDougal is a member of our board of directors. He is a Certified Public Accountant. He began practicing public accounting in 1973 and established his own practice in 1981. The major portion of the practice is with mining and mining related clients including public companies, private companies’ partnerships and individuals. He was a Director and Officer of GEXA Gold Corporation, a publicly traded mining company, from 1985 to 2001. Mr. McDougal was one of the founders of Millennium Mining Corporation which has been merged into Gold Summit Corporation, a publicly traded company. He is the managing partner of GM Squared, LLC, which holds numerous mining claims. He served on the Nevada Society of Certified Public Accountants Committee on Natural Resources for seven years, four years as chairman. Prior to this time Mr. McDougal spend 20 years in the United States Air Force, retiring with the rank of Major.

K. Ian Matheson. Mr. Matheson has been a member of our board of directors since February 10, 2005. Mr. Matheson has been a director and President of the following Nevada private companies that have been involved in the research and development of precious metals in the southern Nevada area: Pilot Plant Inc. (since May 1, 2003); Pass Minerals Inc. (since August 15, 1995) and Kiminco Inc. (since June 26, 1995). Mr. Matheson earned a Bachelor of Commerce degree from the University of British Columbia in 1963. In 1964 and 1965 he attended McGill University in Montreal, Quebec where he earned a degree

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as a Chartered Accountant at the Quebec Institute of Chartered Accountants. He was admitted into the British Columbia Institute of Chartered Accountants in 1965. From 1965 to 1967 he worked as a Chartered Accountant with Coopers and Lybrands in Vancouver, BC. He is presently a member of the British Columbia Institute of Chartered Accountants and the Canadian Institute of Chartered Accountants.

Term of Office

Our directors are appointed for a one-year term to hold office until the next annual general meeting of our stockholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.

Committees of the Board Of Directors

Other than as described below, we do not have any committees.

Audit Committee

We have an audit committee and audit committee charter. Our audit committee is presently comprised of Carl S. Ager, Ian R. McNeil and Robert D. McDougal. A copy of Searchlight’s audit committee charter was filed as an exhibit with to Searchlight’s Form 10-KSB for the year ended December 31, 2003. Searchlight’s audit committee is responsible for: (1) selection and oversight of its independent accountant; (2) establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal controls and auditing matters; (3) establishing procedures for the confidential, anonymous submission by Searchlight’s employees of concerns regarding accounting and auditing matters; (4) engaging outside advisors; and, (5) funding for the outside auditory and any outside advisors engagement by the audit committee.

Disclosure Committee and Charter

Searchlight has a disclosure committee and disclosure committee charter. Searchlight’s disclosure committee is presently comprised of Carl S. Ager, Ian R. McNeil and Robert D. McDougal. A copy of the disclosure committee charter was filed as an exhibit to Searchlight’s Form 10-KSB for the year ended December 31, 2003. The purpose of the committee is to provide assistance to the Chief Executive Officer and the Chief Financial Officer in fulfilling their responsibilities regarding the identification and disclosure of material information about Searchlight and the accuracy, completeness and timeliness of its financial reports.

Audit Committee Financial Expert

Robert McDougal, a member of our audit committee and our board of directors is our “audit committee financial expert” as defined by applicable rules of the SEC.

CODE OF ETHICS

We adopted a Code of Ethics applicable to our Chief Executive Officer, Chief Financial Officer, Corporate Controller and certain other finance executives, which is a "code of ethics" as defined by applicable rules of the SEC. Our Code of Ethics is attached as an exhibit to our Annual Report on Form 10-KSB for the year ended December 31, 2003, filed on April 13, 2004. If we make any amendments to our Code of Ethics other than technical, administrative, or other non-substantive amendments, or grant any waivers, including implicit waivers, from a provision of our Code of Ethics to our chief executive officer, chief financial officer, or certain other finance executives, we will disclose the nature of the amendment or waiver, its effective date and to whom it applies in a Current Report on Form 8-K filed with the SEC.

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COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT

Section 16(a) of the Exchange Act requires our executive officers and directors, and persons who beneficially own more than ten percent of our equity securities, to file reports of ownership and changes in ownership with the SEC. Officers, directors and greater than ten percent shareholders are required by the SEC regulation to furnish us with copies of all Section 16(a) forms they file. Based on our review of the copies of such forms received by us, other than as disclosed below, we believe that during the fiscal year ended December 31, 2005 all such filing requirements applicable to our officers and directors were complied with.

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ITEM 10.               EXECUTIVE COMPENSATION.

Management Compensation

The following table summarizes the compensation awarded to, earned by, or paid to Searchlight’s President and Chief Executive Officer and other officers and directors who received annual compensation in excess of $100,000 (the “Named Executive Officers”) for each of Searchlight’s three most recently completed fiscal years.

Notes:

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EXERCISES OF STOCK OPTIONS AND YEAR-END OPTION VALUES

No stock options were exercised by Searchlight’s executive officers or directors during the financial year ended December 31, 2005 and no stock options have been exercised since December 31, 2005.

Notes:

STOCK OPTION GRANTS

The following table sets forth information with respect to stock options granted to each of Searchlight’s Named Executive Officers during Searchlight’s most recent fiscal year ended December 31, 2005:

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COMPENSATION ARRANGEMENTS

We pay out of town directors a fee of $1,000 per directors meeting attended. We also periodically grant stock incentive options to our directors in consideration for them providing their services as directors. Our 2003 Non-Qualified Stock Option Plan permits the grant of incentive stock options to our directors. We pay a management fee of $3,500 per month to Pass Minerals Inc., a company controlled by Mr. Matheson, for management services provided regarding the reorganization of Searchlight and the development of assaying and testing procedures for the Searchlight Claims.

We conduct our business through agreements with consultants and arms-length third parties. Currently, we have a verbal agreement with our consulting geologists to provide us with consulting services on request

CHANGE IN CONTROL ARRANGEMENTS

We have entered into compensation agreements with two of our directors, Carl S. Ager and Ian R. McNeil. The agreements provide for severance arrangements where change of control of Searchlight occurs, as defined, and the directors are terminated. The compensation payable to Mr. Ager would include a lump sum payment of $40,000 plus the amount of annual bonuses that Mr. Ager would be entitled to receive for the six month period following termination, plus benefits for the six month period following termination. The compensation payable to Mr. McNeil would include a lump sum payment of $54,000 plus the amount of annual bonuses that Mr. McNeil would be entitled to receive for the six month period following termination, plus benefits for the six month period following termination. The compensation that would be payable to the directors aggregates $94,000 plus the amount of annual bonuses and other benefits that they would have received in the six months following termination.

EMPLOYMENT CONTRACTS

Other than as described below, we are not party to any employment contracts.

Ian R. McNeil. We entered into an employment agreement with Ian R. McNeil effective January 1, 2006. Pursuant to the terms of the agreement, Mr. McNeil is to be paid an annual salary of $108,000 and a bonus of $36,000 on execution of the agreement, in consideration of which Mr. McNeil agreed to act as our President and Chief Executive Officer. Mr. McNeil is also eligible for a discretionary bonus to be determined based on factors considered relevant by our board of directors, and may be granted, subject to the approval of our Board, incentive stock options to purchase shares of our common stock in such amounts and at such times as the Board, in its absolute discretion, may from time to time determine. The term of the agreement is for an indefinite period, unless otherwise terminated pursuant to the terms of the

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agreement. In the event that the agreement is terminated by us other than for cause, we will provide Mr. McNeil with six months written notice or payment equal to six months of his monthly remuneration.

Carl S. Ager. We entered into an employment agreement with Carl S. Ager effective January 1, 2006. Pursuant to the terms of the agreement, Mr. Ager is to be paid an annual salary of $80,000 and a bonus of $26,666 on execution of the agreement, in consideration of which Mr. Ager agreed to act as our Treasurer and Secretary. Mr. Ager is also eligible for a discretionary bonus to be determined based on factors considered relevant by our board of directors, and may be granted, subject to the approval of our Board, incentive stock options to purchase shares of our common stock in such amounts and at such times as the Board, in its absolute discretion, may from time to time determine. The term of the agreement is for an indefinite period, unless otherwise terminated pursuant to the terms of the agreement. In the event that the agreement is terminated by us other than for cause, we will provide Mr. Ager with six months written notice or payment equal to six months of his monthly remuneration.

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ITEM 11.               SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The following table sets forth certain summary information concerning the compensation paid or accrued for each of Searchlight’s last three completed fiscal years to Searchlight’s Chief Executive Officer and each of its other executive officers that received compensation in excess of $100,000 during such period (as determined at December 31, 2005, the end of Searchlight’s last completed fiscal year) (the “Named Executive Officers”). Unless otherwise indicated, the stockholders listed possess sole voting and investment power with respect to the shares shown.