CONSOLIDATED FINANCIAL STATEMENTS

THREE AND SIX MONTHS ENDED
JUNE 30, 2011

(Unaudited)

(Expressed in thousands of Canadian Dollars, unless otherwise stated)

GREAT BASIN GOLD LTD.

Consolidated Statement of Loss

(Expressed in thousands of Canadian dollars, except per share data - unaudited)

			Three months ended					Six months ended
			June 30					June 30
	Note		2011		2010			2011		2010
			$ '000		$ '000			$ '000		$ '000
Revenue		$	56,738		37,940		$	83,081		44,762
Cost of operations
Production cost			(30,034	)	(23,797	)		(44,180	)	(28,887	)
Depletion charge			(1,856	)	(3,401	)		(2,990	)	(3,541	)
Depreciation charge			(5,984	)	(1,033	)		(7,198	)	(1,236	)
Expenses
Exploration expenses			(3,443	)	(2,631	)		(6,344	)	(4,915	)
Pre-development expenses			(3,686	)	(3,813	)		(7,425	)	(6,685	)
Corporate and administrative cost			(1,938	)	(1,735	)		(4,220	)	(3,405	)
Environmental impact study			(488	)	(743	)		(925	)	(1,239	)
Foreign exchange gain (loss) - net			714		(2,889	)		3,177		(1,371	)
Salaries and compensation
Salaries and wages			(2,171	)	(1,891	)		(4,510	)	(3,187	)
Share based payments expense	8(b)		(1,574	)	(1,818	)		(3,015	)	(2,708	)
Profit (loss) from operating activities			6,278		(5,811	)		5,451		(12,412	)
Net interest (expense) income			(5,722	)	383			(10,404	)	1,013
Net realized gain on financial instruments			–		422			–		422
Loss on disposal of mineral property investment			(232	)	–			(232	)	–
Loss on settlement of senior secured notes	6(c)		–		–			(8,817	)	–
Net unrealized gain (loss) on financial instruments recognized	7		70		–			(7,209	)	–
Net unrealized marked-to-market adjustments on financial instruments	7		(1,443	)	–			(179	)	–
Loss before income tax			(1,049	)	(5,006	)		(21,390	)	(10,977	)
Income tax			(2	)	103			(2	)	(13	)
Loss for the period		$	(1,051	)	(4,903	)	$	(21,392	)	(10,990	)
Basic and diluted loss per share		$	0.00		(0.01	)	$	(0.05	)	(0.03	)
Weighted average number of common shares outstanding (thousands)			454,559		340,609			443,155		338,761

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

2

GREAT BASIN GOLD LTD.

Consolidated Statement of Comprehensive (Loss) Income

(Expressed in thousands of Canadian dollars - unaudited)

		Three months ended						Six months ended
					June 30					June 30
		2011			2010			2011		2010
		$ '000			$ '000			$ '000		$ '000
Loss for the period	$	(1,051	)	$	(4,903	)	$	(21,392	)	(10,990	)
Other comprehensive (loss) income
Changes in fair value of financial instruments		–			707			–		603
Realized gain on available-for-sale financial instruments upon transfer to net income		–			(1,530	)		–		(1,530	)
Cumulative translation adjustment		(3,307	)		7,703			(29,956	)	(2,167	)
Other comprehensive (loss) income for the period	$	(3,307	)	$	6,880		$	(29,956	)	(3,094	)
Comprehensive (loss) income for the period	$	(4,358	)	$	1,977		$	(51,348	)	(14,084	)

3

GREAT BASIN GOLD LTD.

Consolidated Statement of Financial Position

(Expressed in thousands of Canadian dollars - unaudited)

		June 30		December 31
	Note	2011		2010
		$ '000		$ '000
Assets
Current assets
Cash and cash equivalents		38,771		12,855
Trade and other receivables		9,489		9,340
Inventories	4	27,651		18,440
Other current assets		664		1,283
		76,575		41,918
Non-current assets
Loan due from related party		14,571		13,372
Property, plant and equipment	5	730,530		695,374
Other assets		4,976		4,719
Total assets		826,652		755,383
Liabilities
Current liabilities
Trade payables and accrued liabilities		45,597		61,731
Current portion of long-term debt	6	41,529		53,516
Current portion of other liabilities	7	826		278
		87,952		115,525
Non-current liabilities
Long-term debt	6	192,546		156,062
Other liabilities	7	18,742		12,419
Site reclamation obligations		5,460		5,660
Total liabilities		304,700		289,666
Equity
Share capital		817,434		709,449
Warrants		2,315		6,108
Contributed surplus		81,067		77,676
Accumulated other comprehensive (loss) income		(3,561	)	26,395
Deficit		(375,303	)	(353,911	)
		521,952		465,717
Total liabilities and equity		826,652		755,383
Segment disclosure	10
Subsequent events	11

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

Approved by the Board of Directors

/s/ Ferdinand Dippenaar	/s/ Ronald W. Thiessen
Ferdinand Dippenaar	Ronald W. Thiessen
Chief Executive Officer	Director

4

GREAT BASIN GOLD LTD.

Consolidated Statements of Changes in Equity

(Expressed in thousands of Canadian dollars - unaudited)

									Accumulated
									other
	Share capital		Warrants				Contributed		comprehensive
	Common shares	Amount	Warrants		Amount		surplus		income (loss)		Deficit		Total
	(thousands)	$'000	(thousands)		$'000		$'000		$'000		$'000		$'000
Balance - January 1, 2011	414,015	709,449	24,918		6,108		77,676		26,395		(353,911	)	465,717
Net loss for the period	-	-	-		-		-		-		(21,392	)	(21,392	)
Other comprehensive loss	-	-	-		-		-		(29,956	)	-		(29,956	)
Comprehensive loss for the period	-	-	-		-		-		(29,956	)	(21,392	)	(51,348	)
Employee stock options Value of services recognized (note 8(b))	-	-	-		-		4,965		-		-		4,965
Proceeds on issuing shares Warrants	1,716	4,206	-		-		(1,574	)	-		-		2,632
Proceeds on issuing shares (note 8(d))	15,473	22,426	(15,473	)	(3,793	)	-		-		-		18,633
Proceeds on issuance of shares for public offering net of issue cost (note 8(c))	33,827	81,190	-		-		-		-		-		81,190
Other	100	163	-		-		-		-		-		163
Balance - June 30, 2011	465,131	817,434	9,445		2,315		81,067		(3,561	)	(375,303	)	521,952
Balance - January 1, 2010	334,158	567,596	86,179		13,104		74,403		927		(326,770	)	329,260
Net loss for the period	-	-	-		-		-		-		(10,990	)	(10,990	)
Other comprehensive loss	-	-	-		-		-		(3,094	)	-		(3,094	)
Comprehensive loss for the period	-	-	-		-		-		(3,094	)	(10,990	)	(14,084	)
Employee stock options Value of services recognized (note 8(b))	-	-	-		-		3,862		-		-		3,862
Proceeds on issuing shares	1,038	1,990	-		-		(561	)	-		-		1,429
Warrants
Proceeds on issuing shares	1	1	(1	)	-		-		-		-		1
Shares issued for early settlement of senior secured notes	2,234	3,910	-		-		-		-		-		3,910
Shares issued for mineral properties	10,574	19,243	-		-		-		-		-		19,243
Balance - June 30, 2010	348,005	592,740	86,178		13,104		77,704		(2,167	)	(337,760	)	343,621

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

5

GREAT BASIN GOLD LTD.

Consolidated Statements of Cash Flows

(Expressed in thousands of Canadian dollars - unaudited)

		Three months ended June 30						Six months ended June 30
		2011			2010			2011			2010
		$ '000			$ '000			$ '000			$ '000
Operating activities
Loss for the period	$	(1,051	)	$	(4,903	)	$	(21,392	)	$	(10,990	)
Items not involving cash
Production non-cash charges		797			1,183			967			1,236
Pre-development non-cash charges		(13	)		329			375			523
Exploration non-cash charges		32			62			91			136
Depreciation		6,160			(148	)		7,554			107
Share donation		163			–			163			–
Net realized profit on financial instruments		–			(422	)		–			(422	)
Unrealized loss on financial instruments		46			22			16			34
Unrealized (gain) loss on financial instruments recognized		(70	)		–			7,209			–
Unrealized marked-to-market adjustments on financial instruments		1,443			–			179			–
Share based payments expense		1,574			1,818			3,015			2,708
Unrealized foreign exchange (gain) loss		(446	)		1,186			(3,258	)		(553	)
Depletion		1,856			3,401			2,990			3,541
Interest expense		6,126			18			11,197			67
Interest income		(404	)		(401	)		(793	)		(1,080	)
Loss on settlement of senior secured notes		–			–			8,817			–
Changes in non-cash operating working capital
Trade and other receivables		(2,362	)		(9,609	)		(578	)		(14,185	)
Other current assets		398			(135	)		581			(581	)
Inventories		830			10,075			(7,710	)		1,982
Trade payables and accrued liabilities		8,676			3,691			4,850			4,469
Net cash generated (utilized) by operating activities		23,755			6,167			14,273			(13,008	)
Investing activities
Advance to related party		(1,468	)		–			(1,468	)		–
Net proceeds on sale of financial instruments		–			3,527			–			3,527
Purchase of property, plant and equipment		(56,657	)		(46,104	)		(93,191	)		(76,061	)
Additions to restricted cash		–			(5,882	)		–			(5,882	)
Interest income		152			426			322			1,033
Reclamation deposits		(99	)		(30	)		(460	)		98
Net cash utilized by investing activities		(58,072	)		(48,063	)		(94,797	)		(77,285	)
Financing activities
Common shares and warrants issued for cash, net of issue costs		14,338			215			102,455			1,354
Proceeds on issuance of debt		–			47,848			68,810			47,848
Repayment of debt		(2,069	)		(4,945	)		(55,755	)		(5,231	)
Interest expense		(7,912	)		(5,404	)		(9,040	)		(5,453	)
Net cash generated from financing activities		4,357			37,714			106,470			38,518
(Decrease) increase in cash and cash equivalents		(29,960	)		(4,182	)		25,946			(51,775	)
Cash and cash equivalents, beginning of period		68,018			41,448			12,855			89,464
Foreign exchange movement on cash and cash equivalents		713			2,290			(30	)		1,867
Cash and cash equivalents, end of period	$	38,771		$	39,556		$	38,771		$	39,556

Refer note 9 of the notes to the consolidated interim financial statements for supplementary information to the cash flow statement.

6

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

1.	General information
	Great Basin Gold Ltd. (“Great Basin” or the “Company”) is incorporated under the laws of the Province of British Columbia and its registered address is 1108-1030 West Georgia Street, Vancouver BC, Canada. The Company is a mineral exploration and development company that is currently focused on delivering two advanced stage projects: the Hollister Project on the Carlin Trend in Nevada, USA and the Burnstone Project in the Witwatersrand Goldfields in South Africa. The Company, currently recognized as an emerging producer, will migrate to the rank of a junior gold producer as production from these two projects increases during 2011 and 2012. Over and above the exploration being conducted at the above mentioned properties, greenfields exploration is being undertaken in Tanzania and Mozambique.
	Operating results for the three and six month periods ended June 30, 2011 are not necessarily indicative of the results that may be expected for the full fiscal year ending December 31, 2011. In the opinion of management, these unaudited interim consolidated financial statements reflect all adjustments that are necessary for a fair presentation of the results for the interim period presented.
2.	Basis of preparation and adoption of IFRS
	The Company prepares its financial statements in accordance with Canadian Generally Accepted Accounting Principles (“GAAP”) as set out in the Handbook of the Canadian Institute of Chartered Accountants (“CICA Handbook”). In 2010, the CICA Handbook was revised to incorporate International Financial Reporting Standards (“IFRS”), and require publicly accountable enterprises to apply such standards effective for years beginning on or after January 1, 2011. Accordingly, the Company commenced reporting on this basis in its 2011 interim consolidated financial statements. In these financial statements, the term “Canadian GAAP” refers to Canadian GAAP before the adoption of IFRS.
	These interim consolidated financial statements have been prepared in accordance with IFRS applicable to the preparation of interim financial statements, including IAS34, Interim Financial Reporting, and IFRS 1, First-time Adoption of International Financial Reporting Standards. The accounting policies followed in these interim financial statements are the same as those applied in the Company’s interim financial statements for the period ended March 31, 2011. The Company has consistently applied the same accounting policies throughout all periods presented, as if these policies had always been in effect. Note 12 discloses the impact of the transition to IFRS on the Company’s reported equity as at June 30, 2010 and comprehensive loss for the three and six months ended June 30, 2010.
	The accounting policies applied in these interim consolidated financial statements are based on IFRS effective for the year ended December 31, 2011, as issued and outstanding as of August 4, 2011, the date the Board of Directors approved the statements. Any subsequent changes to IFRS that are given effect in the Company’s annual consolidated financial statements for the year ending December 31, 2011 could result in restatement of these interim consolidated financial statements, including the transition adjustments recognized on change-over to IFRS.

7

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

2.	Basis of preparation and adoption of IFRS (continued)
	The interim consolidated financial statements should be read in conjunction with the Company’s Canadian GAAP annual financial statements for the year ended December 31, 2010, and the Company’s interim financial statements for the quarter ended March 31, 2011 prepared in accordance with IFRS applicable to interim financial statements, which are both available through the internet on SEDAR at www.sedar.com.
3.	Significant accounting policies, judgments and estimation uncertainty
	Significant accounting policies
	These unaudited interim consolidated financial statements follow the same accounting policies and methods of application as the Company’s most recent annual financial statements, except for those changes recognized on change-over to IFRS, as described in note 12 of the Company’s interim financial statements for the quarter ended March 31, 2011.
	Critical accounting estimates and judgments
	The Company makes estimates and assumptions concerning the future that will, by definition, seldom equal actual results. These estimates and judgments have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
	Significant areas requiring the use of management estimates relate to impairment of mineral property interests, valuation of inventories, allocation of purchase price consideration to the fair value of identifiable assets and liabilities acquired, the determination of amortization, depletion and accretion, determination of reclamation obligations, the determination of the fair values of financial instruments, assumptions used in determining the fair value of non-cash share based payments, warrants and derivatives, determination of valuation allowances for deferred income tax liabilities, estimated market related interest rate used to calculate the equity component of compound financial instruments and allocation of indirect mining and overhead expenses to production and development costs.
4.	Inventories

	June 30	December 31
	2011	2010
	$ ‘000	$ ‘000
Stores and materials	5,089	3,534
Unprocessed ore	7,936	3,220
Precious metals in process	14,626	11,686
	27,651	18,440

Cost of operations recognized in the statement of income consists of direct and indirect mining costs, overhead costs, royalties, depreciation of mining equipment and depletion of mineral properties. During the three and six months ended June 30, 2011, stores and materials, unprocessed ore and precious metal in process of $37.9 million (2010: $28.2 million) and $54.4 million (2010: $33.7 million) have been included under cost of operations respectively.

8

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

5. Property, plant and equipment

			Mineral
	Mineral		properties		Mine
	properties		not		infrastructure
	subject to		subject to		and		Leased		Other
	depletion		depletion		equipment		assets		assets		Total
	$’000		$’000		$’000		$’000		$’000		$’000
Six months ended June 30, 2011
Opening net book value	134,582		48,410		499,654		9,039		3,689		695,374
Additions	-		-		79,385		2,054		895		82,334
Transferred	-		-		1,978		(1,978	)	-		-
Depletion and depreciation	(2,633	)	-		(9,908	)	(923	)	(848	)	(14,312	)
Foreign exchange differences	(6,119	)	(93	)	(26,044	)	(460	)	(150	)	(32,866	)
Closing net book value	125,830		48,317		545,065		7,732		3,586		730,530
At June 30, 2011:
Cost	142,721		48,317		572,839		9,291		6,840		780,008
Accumulated depreciation	(16,891	)	-		(27,774	)	(1,559	)	(3,254	)	(49,478	)
Net book value	125,830		48,317		545,065		7,732		3,586		730,530
Year ended December 31, 2010
Opening net book value	138,624		29,183		187,325		2,153		1,996		359,281
Additions	-		19,399		293,739		7,317		2,095		322,550
Disposals	-		-		-		-
Depletion and depreciation	(6,158	)	-		(9,278	)	(819	)	(553	)	(16,808	)
Foreign exchange differences	2,116		(172	)	27,868		388		151		30,351
Closing net book value	134,582		48,410		499,654		9,039		3,689		695,374
At December 31, 2010:
Cost	149,313		48,410		518,210		10,250		6,351		732,534
Accumulated depreciation	(14,731	)	-		(18,556	)	(1,211	)	(2,662	)	(37,160	)
Net book value	134,582		48,410		499,654		9,039		3,689		695,374

As at June 30, 2011, $13.3 million of plant and equipment included under mine infrastructure and equipment is not being amortized (December 31, 2010, $435.3 million).

Leased assets are pledged as security for the related finance leases (refer note 6). Mineral properties of $129 million consisting of the Hollister and Burnstone properties and fixed assets of $549 million have been pledged as security for the term loans (refer note 6(a) and (b)).

9

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

6. Long-term debt

Non-current portion of long-term debt
	June 30	December 31
	2011	2010
	$ ‘000	$ ‘000
Convertible debentures	93,567	91,677
Finance lease liabilities	87	436
Term loan I (note 6(a))	51,524	63,949
Term loan II (note 6(b))	47,368	-
	192,546	156,062

Current portion of long-term debt
	June 30	December 31
	2011	2010
	$ ‘000	$ ‘000
Convertible debentures	1,378	-
Finance lease liabilities	5,722	6,955
Senior secured notes (note 6(c))	-	40,101
Term loan I (note 6(a))	16,161	6,460
Term loan II (note 6(b))	18,268	-
	41,529	53,516

The continuity of long-term debt is as follows:
	June 30		December 31
	2011		2010
	$ ‘000		$ ‘000
Opening balance at January 1	209,578		130,716
New debt (note 6(b))	68,810		75,942
New leases	2,054		7,261
Transaction cost (note 6(b))	(2,152	)	(3,707	)
Repayment of debt	(62,724	)	(25,092	)
Settlement loss on senior secured notes (note 6(c))	8,817		-
Amortized transaction cost	559		505
Interest expense	13,356		30,406
Foreign exchange	(4,223	)	(6,453	)
	234,075		209,578

(a) Term loan I

Term loan I has a maximum term of 4 years from date of first draw down and will be repaid in 13 quarterly consecutive installments. The first installment was settled on May 26, 2011, 12 months after initial draw down. The interest rate for Term loan I is linked to the USD London interbank offered rate (“USD LIBOR”) at a premium of 4% above USD LIBOR and is fixed on a quarterly basis. The floating rate on June 30, 2011 is 4.255% (USD LIBOR of 0.255% plus 4% premium).

10

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

6.	Long-term debt (continued)
	(a) Term loan I (continued)
	The Burnstone Property, its assets and certain subsidiary guarantees serve as security for the loan. Term loan I contains certain financial covenants customary to facilities of this nature and includes borrower tangible net worth, debt to equity ratio, debt service cover ratio and a loan life cover ratio. As at June 30, 2011, the Company assessed and complied with all covenants.
	Refer to note 7(a) for details of the hedge entered into under the Term loan I agreement.
	(b) Term loan II
	The Company closed a $69 million (US$70 million) term loan with Credit Suisse AG in March 2011 (“Term loan II”). Term loan II has a maximum term of 4 years from date of first draw down and will be repaid in 13 quarterly consecutive installments, commencing September, 2011. The interest rate for Term loan II is linked to the USD LIBOR at a premium of 3.75% above USD LIBOR and is fixed on a quarterly basis. The floating rate on June 30, 2011 is 3.9985% (USD LIBOR of 0.2485% plus 3.75% premium).
	The Hollister project and a surety signed by the Company serve as security for the loan.
	Term loan II contains certain financial covenants customary to facilities of this nature and includes borrower tangible net worth, debt to equity ratio, debt service cover ratio and a loan life cover ratio. As at June 30, 2011, the Company assessed and complied with all covenants.
	Refer to note 7(b) for details of the hedge entered into under the Term loan II agreement.
	(c) Senior secured notes
	On March 15, 2011, the Company applied $50.3 million (US$51.4 million) from the Term loan II proceeds towards full and final settlement of the senior secured notes issued in December 2008. The liability was settled at an accounting loss of $8.8 million (US$8.9 million) calculated as the difference between the amortized carrying value and the outstanding debt amount on the date of settlement.
7.	Other liabilities
	Non-current portion of other liabilities

	June 30	December 31
	2011	2010
	$ ‘000	$ ‘000
Financial guarantee	2,454	2,597
Zero cost collar program I (note 7(a))	6,770	9,822
Zero cost collar program II (note 7(b))	9,518	-
	18,742	12,419

11

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

7. Other liabilities (continued)

Current portion of other liabilities
	June 30	December 31
	2011	2010
	$ ‘000	$ ‘000
Zero cost collar program I (note 7(a))	788	278
Zero cost collar program II (note 7(b))	38	-
	826	278

The continuity of other liabilities is as follows:
	June 30		December 31
	2011		2010
	$ ‘000		$ ‘000
Opening balance at January 1	12,697		-
Fair value of guarantee	-		2,597
ZCC fair value upon inception (note 7(b))	7,209		3,606
Marked-to-market adjustments – ZCC I	(2,289	)	6,860
Marked-to-market adjustments – ZCC II	2,468		-
Foreign exchange	(517	)	(366	)
	19,568		12,697

(a) Zero cost collar program I

In connection with Term loan I (refer note 6(a)), the Company executed a zero cost collar (“ZCC”) hedge program for a total 105,000 gold ounces over a period of three years that commenced in January 2011.

As of January 1, 2011, the Company is required to deliver 1,250 gold ounces per month over a twelve month period. The remaining 90,000 gold ounces will be delivered in 24 equal monthly deliveries of 3,750 gold ounces, starting January 1, 2012. The program includes put options priced at US$850 and call options priced at US$1,705 per gold oz.

Gold delivery positions as at June 30, 2011:

	June 30	December 31
	2011	2010
Expired unexercised at no cost	7,500 ounces	Nil ounces
Remaining positions	97,500 ounces	105,000 ounces

Marked-to-market movements were calculated using an option pricing model with inputs based on the following assumptions:

	June 30	December 31
	2011	2010
Gold price (per ounce)	US$1,500	US$1,419
Risk free interest rate	0.23% - 1.09%	0.25% - 1.34%
Expected life	1 - 30 months	1 - 36 months
Gold price volatility	13.93% - 24.10%	17.3% - 27%

12

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

7. Other liabilities (continued)

(a) Zero cost collar program I (continued)

The fair values of the derivative instruments as of June 30, 2011 were as follows:

		Asset	Liability		Net
		Derivatives	derivatives		Derivatives
		Estimated	Estimated		Estimated
Derivatives not designated as	Balance sheet	fair value	fair value		fair value
hedging instruments	classification	$ ‘000	$ ‘000		$ ‘000
Commodity contracts (gold) – ZCC 1	Current other liabilities	-	(788	)	(788	)
Commodity contracts (gold) – ZCC 1	Other liabilities	236	(7,006	)	(6,770	)

(b) Zero cost collar program II

In connection with Term loan II (refer note 6(b)), the Company executed a ZCC hedge program for a total 117,500 gold ounces over a period of four years, commencing in January 2012.

The Company will be required to deliver 875 gold ounces per month over a twelve month period followed by 3,000 gold ounces per month over a twenty four month period. The remaining 35,000 gold ounces will be delivered in 12 equal monthly deliveries of 2,916 gold ounces, starting January 30, 2015. The program includes put options priced at US$1,050 and call options priced at US$1,930 per gold oz.

The fair value on inception and subsequent mark-to-market movements were calculated using an option pricing model with inputs based on the following assumptions:

	June 30	March 10
	2011	2011
Gold price (per ounce)	US$1,500	US$1,410
Risk free interest rate	0.38% - 1.53%	0.4% - 1.91%
Expected life	6 - 54 months	10 - 57 months
Gold price volatility	17.41% - 25.61%	19.65% - 26.26%

The fair values of the derivative instruments as of June 30, 2011 were as follows:

		Asset	Liability		Net
		Derivatives	derivatives		derivatives
		Estimated	Estimated		Estimated
Derivatives not designated as	Balance sheet	fair value	fair value		fair value
hedging instruments	classification	$ ‘000	$ ‘000		$ ‘000
Commodity contracts (gold) – ZCC 2	Current other liabilities	7	(45	)	(38	)
Commodity contracts (gold) – ZCC 2	Other liabilities	4,935	(14,453	)	(9,518	)

13

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

8. Share capital

(a) Authorized share capital

The Company’s authorized share capital consists of an unlimited number of common shares without par value.

(b) Share option plan

The continuity of share purchase options is as follows:

			Contractual weighted
	Weighted average	Number of options	average remaining life
	exercise price	(thousands)	(years)
Opening total at January 1	$1.75	16,441	2.26
Granted	$2.45	7,645
Exercised	$1.53	(1,716)
Expired	$2.88	(855)
Forfeited	$2.10	(2,153)
	$1.96	19,362	2.26

As at June 30, 2011, 10 million of the outstanding options were exercisable at an average exercise price of $1.65 per option and expiry dates ranging between August 18, 2011 and May 5, 2016.

In addition to the options outstanding under the stock option plan noted above, out of plan options to acquire 677,766 shares at an exercise price of $0.60 and expiry date of June 1, 2012, remain outstanding in connection with the acquisition of Rusaf.

Costs previously recognized on options were, upon forfeiture, reversed through the current year’s profit or loss.

The exercise prices of all share purchase options granted during the three and six months ended June 30, 2011 and 2010 were at or above the market price at the grant date.

Using an option pricing model with the assumptions noted below, the estimated fair value of options granted which have been included in the statement of income for the three and six months ended June 30, 2011, is as follows:

	Three months ended June 30
	2011		2010
	$ ‘000		$ ‘000
Total compensation cost recognized, credited to contributed surplus	3,095		2,633
Compensation cost allocated to development expenses	-		(127	)
Compensation cost allocated to production cost	(1,521	)	(260	)
Compensation cost capitalized on Burnstone mine development	-		(385	)
Compensation cost allocated to bonus provision	-		(43	)
Share based payments expense	1,574		1,818

14

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

8. Share capital (continued)

(b) Share option plan (continued)

	Six months ended June 30
	2011		2010
	$ ‘000		$ ‘000
Total compensation cost recognized, credited to contributed surplus	4,965		3,862
Compensation cost allocated to development expenses	-		(172	)
Compensation cost allocated to production cost	(1,854	)	(365	)
Compensation cost capitalized on Burnstone mine development	(96	)	(534	)
Compensation cost allocated to bonus provision	-		(83	)
Share based payments expense	3,015		2,708

The weighted-average assumptions used to estimate the fair value of options granted during the respective periods were as follows:

	Three months ended		Six months ended
		June 30		June 30
	2011	20101	2011	2010
Risk free interest rate	3%	-	2.68%	2.7%
Expected life	5 years	-	3.6 years	3.5 years
Expected volatility	74.2%	-	81%	85%
Expected dividends	Nil	-	Nil	Nil
1 No options were granted during the three months ended June 30, 2010

(c) Share issuance, February 2011 - Public Offering

The Company completed a public offering on February 23, 2011 whereby it issued 33,827,250 shares at a price of $2.55 per share thereby raising gross proceeds of $86.3 million.

The Company paid the underwriters a fee of $4.3 million and incurred other share issue costs of approximately $0.8 million for net proceeds of $81.2 million which has been recorded as share capital.

(d) Share issuance – Exercised warrants

Warrant holders exercised 15,473,281 of the $1.25 senior secured notes warrants during the six months ended June 30, 2011.

Each warrant entitled the holder thereof to purchase one common share and the Company accordingly recorded $22.4 million, consisting of proceeds and fair value, as share capital.

15

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

9. Additional cash flow information

Supplementary information
	Three months ended June 30
	2011	2010
	$’000	$’000
Income taxes paid (recovered)	2	(103	)
Non-cash investing activities:
Shares issued for property, plant and equipment	-	13,649
Accrued interest capitalized to property, plant and machinery (note 5)	-	7,172
Share based compensation capitalized (refer note 8(b))	-	385
Non-cash financing activities:
Fair value of stock options transferred to share capital from contributed surplus on options exercised	762	125
Fair value of warrants transferred to share capital on warrants exercised	2,727	-
Shares issued for early settlement of senior secured notes	-	3,910

	Six months ended June 30
	2011	2010
	$’000	$’000
Income taxes paid	2	13
Non-cash investing activities:
Shares issued for property, plant and equipment	-	19,243
Accrued interest capitalized to property, plant and machinery (note 5)	2,515	16,679
Share based compensation capitalized (refer note 8(b))	96	534
Non-cash financing activities:
Fair value of stock options transferred to share capital from contributed surplus on options exercised	1,574	561
Fair value of warrants transferred to share capital on warrants exercised	3,793	-
Shares issued for early settlement of senior secured notes	-	3,910

10.	Segment disclosure
	The Company operates in reportable operating segments to deliver on its strategy to explore, development and operate mineral properties. Management has determined the operating segments based on the reports reviewed by the Company's Chief Operating Decision Maker ("CODM") that are used to make strategic decisions. The Company's CODM is its Chief Executive Officer.

16

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

10. Segment disclosure (continued)

Assets
	June 30	December 31
	2011	2010
	$ ‘000	$ ‘000
Corporate entities
Assets other than mineral property interests	29,114	14,159
Tanzanian exploration
Assets other than mineral property interests	413	618
Mineral property interests	45,127	45,127
Nevada operations
Assets other than mineral property interests	31,245	21,640
Mine development and equipment	40,178	40,508
Mineral property interests	49,801	53,742
South African operations
Assets other than mineral property interests	37,053	25,764
Mine development and equipment	514,502	469,702
Mineral property interests	79,219	84,123
	826,652	755,383

Revenue
	Three months ended June 30
	2011	2010
	$ ‘000	$ ‘000
Nevada operations
Sale of refined precious metals	48,686	37,940
South African operations
Sale of refined precious metals	8,052	-
	56,738	37,940

	Six months ended June 30
	2011	2010
	$ ‘000	$ ‘000
Nevada operations
Sale of refined precious metals	71,195	44,762
South African operations
Sale of refined precious metals	11,886	-
	83,081	44,762

Refined precious metals are sold to Red Kite Explorer Trust under the terms of an off-take agreement.

17

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

11. Subsequent events

Option to acquire 80% of Shield Resources Limited

The Company entered into an agreement in June 2011 whereby it granted Shanta Gold Limited (“Shanta”) the option, following the fulfillment of the conditions precedent, to acquire an 80% interest in the Company’s wholly-owned subsidiary, Shield Resources Limited (“Shield”), who is the holder of various prospecting licenses in the Lupa region of Tanzania.

In consideration for providing Shanta with the exclusive right to acquire the shares in Shield, Shanta is obliged to issue ordinary shares to the value of US$7 million and Shanta warrants to the value of US$7 million (at an implied value of 35p each) to the Company. Furthermore Shanta has to fund a US$12 million exploration program, spread over a period of 3 years ending December 31, 2013 and make additional payments depending on the number of gold ounce resources discovered. Shanta will acquire the 80% equity interest in Shield upon the completion of the exploration program.

18

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

12. Transition to IFRS

The effect of the Company’s transition to IFRS, described in note 2, is summarized below.

(a) Reconciliation of equity and comprehensive loss as previously reported under Canadian GAAP to IFRS

		December 31, 2010						June 30, 2010
		$'000		$'000		$'000		$'000		$'000		$'000
	Note	Cdn GAAP		Adj		IFRS		Cdn GAAP		Adj		IFRS
Assets
Current assets
Cash and cash equivalents		12,855		-		12,855		39,556		-		39,556
Amounts receivable		9,340		-		9,340		18,829		-		18,829
Inventory		18,440		-		18,440		25,095		-		25,095
Available-for-sale financial instruments		-		-		-		-		-		-
Held-for-trading financial instruments		-		-		-		-		-		-
Other assets		1,283		-		1,283		1,424		-		1,424
		41,918		-		41,918		84,904		-		84,904
Loans due from related parties		13,372		-		13,372		-				-
Property, plant and equipment		512,384		-		512,384		317,659		-		317,659
Reclamation deposits		4,719		-		4,719		4,507		-		4,507
Restricted cash		-		-		-		11,118		-		11,118
Mineral property interests	(i)	245,649		(62,659	)	182,990		244,998		(62,091	)	182,907
Total Assets		818,042		(62,659	)	755,383		663,186		(62,091	)	601,095
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities		61,731		-		61,731		68,080		-		68,080
Current portion of long term borrowings		53,516		-		53,516		21,387		-		21,387
Current portion of other liabilities		278		-		278		-		-		-
		115,525		-		115,525		89,467		-		89,467
Long term borrowings		156,062		-		156,062		161,569		-		161,569
Future income taxes	(i);(ii)	18,939		(18,939	)	-		18,939		(18,939	)	-
Other liabilities		12,419		-		12,419		2,361		-		2,361
Site reclamation obligations		5,660		-		5,660		4,077		-		4,077
		193,080		(18,939	)	174,141		186,946		(18,939	)	168,007
Shareholders' equity
Share capital		709,449		-		709,449		592,740		-		592,740
Warrants		6,108		-		6,108		13,104		-		13,104
Contributed surplus	(ii)	86,540		(8,864	)	77,676		86,568		(8,864	)	77,704
Deficit	(iv)	(294,625	)	(59,286	)	(353,911	)	(277,625	)	(60,135	)	(337,760	)
Accumulated other comprehensive income (loss)	(iii)	1,965		24,430		26,395		(28,014	)	25,847		(2,167	)
		509,437		(43,720	)	465,717		386,773		(43,152	)	343,621
Total Liabilities and Shareholders' Equity		818,042		(62,659	)	755,383		663,186		(62,091	)	601,095

19

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

12. Transition to IFRS (continued)

(a) Reconciliation of equity and comprehensive loss as previously reported under Canadian GAAP to IFRS (continued)

		Three months ended June 30, 2010						Six months ended June 30, 2010
		$ '000		$ '000		$ '000		$ '000		$ '000	$ '000
	Note	Cdn GAAP		Adj		IFRS		Cdn GAAP		Adj	IFRS
Revenue		37,940				37,940		44,762			44,762
(Expenses) income
Production cost		(24,826	)			(24,826	)	(30,123	)		(30,123	)
Depletion charge	(i)	(3,899	)	498		(3,401	)	(4,464	)	923	(3,541	)
Exploration expenses		(2,631	)			(2,631	)	(4,915	)		(4,915	)
Pre-development expenses		(3,813	)			(3,813	)	(6,685	)		(6,685	)
Corporate and administrative cost		(1,717	)			(1,717	)	(3,371	)		(3,371	)
Corporate social responsibility		–				–		-			–
Environmental impact study		(743	)			(743	)	(1,239	)		(1,239	)
Foreign exchange gain - net		(2,889	)			(2,889	)	(1,371	)		(1,371	)
Salaries and compensation						–					–
Salaries and wages		(1,891	)			(1,891	)	(3,187	)		(3,187	)
Stock-based compensation		(1,818	)			(1,818	)	(2,708	)		(2,708	)
Loss before the undernoted and income taxes		(6,287	)	498		(5,789	)	(13,301	)	923	(12,378	)
Interest expense		(18	)			(18	)	(67	)		(67	)
Interest income		401				401		1,080			1,080
Net realized gain on available-for-sale financial instruments		489				489		489			489
Net realized loss on held-for-trading financial instruments		(67	)			(67	)	(67	)		(67	)
Net unrealized gain (loss) on held-for-trading financial instruments		(22	)			(22	)	(34	)		(34	)
Net unrealized loss on held-for-trading financial instruments recognized		–				–		–			–
Net unrealized market-to-market adjustments on held-for-trading financial instruments		–				–		–			–
Loss before income taxes		(5,504	)	498		(5,006	)	(11,900	)	923	(10,977	)
Taxes recovered (paid)		103				103		(13	)		(13	)
Future income tax recovery		–				–		–			–
Loss for the year		(5,401	)	498		(4,903	)	(11,913	)	923	(10,990	)
Other comprehensive income (loss)
Unrealized gain on available-for-sale financial instruments		707				707		603			603
Realized gain on available-for-sale financial instruments upon transfer		(1,530	)			(1,530	)	(1,530	)		(1,530	)
Unrealized gain (loss) on foreign exchange translation of self-sustaining foreign operations	(i)	8,513		(810	)	7,703		(2,546	)	379	(2,167	)
Other comprehensive income (loss)		7,690		(810	)	6,880		(3,473	)	379	(3,094	)
Total comprehensive loss for the year		2,289		(312	)	1,977		(15,386	)	1,302	(14,084	)
Basic and diluted loss per share		(0.02	)			(0.01	)	(0.04	)		(0.03	)
Weighted average number of common shares outstanding (thousands)		340,609				340,609		338,761			338,761

(i) Mineral property interests

Under Canadian GAAP the fair value allocation on acquisition of mineral properties, treated as asset acquisitions, included a gross-up of deferred tax on the allocated fair value with the debit entry capitalized to the mineral property and the credit entry accounted for as a future income tax (deferred tax) liability. An IFRS adjusting entry in the amount of $65 million was processed on the January 1, 2010 balance sheet to eliminate the future income tax entry accounted for on acquisition of mineral properties.

20

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

12. Transition to IFRS (continued)

(a) Reconciliation of equity and comprehensive loss as previously reported under Canadian GAAP to IFRS (continued)

(i) Mineral property interests (continued)

The adjustment to the values of mineral properties also affected other comprehensive income as well as depletion charges recorded in 2009 and 2010 on the Hollister mineral property. The impact on other comprehensive income relates to the foreign exchange translation of these mineral properties. Adjusting entries were processed to mineral properties, accumulated other comprehensive income (refer (iii) below) and deficit (refer (iv) below).

(ii) Future income taxes (deferred taxes)

In addition to the adjustment to future income taxes as noted in (i) above an additional adjustment was processed to eliminate the future income tax liability recognized under Canadian GAAP on the temporary difference between the accounting and tax base of mineral properties. Under IFRS, deferred taxes should not be recognized for the acquisition of assets that do not constitute a business combination and had no income statement impact on initial recognition.

A third adjustment to future income taxes was processed to account for a deferred tax liability on the temporary difference between the convertible debt instrument’s tax and accounting bases. Under IFRS the debit entry is recognized with the equity component of this compounded financial instrument in contributed surplus.

(iii) Accumulated other comprehensive income

In accordance with IFRS transitional provisions, the Company has elected to reset the foreign cumulative translation adjustment (“CTA”), which includes gains and losses arising from the translation of foreign operations, at the date of transition to IFRS.

The following is a summary of transition adjustments to the Company’s accumulated other comprehensive loss from Canadian GAAP to IFRS:

	December 31	June 30
	2010	2010
	$ ‘000	$ ‘000
Accumulated other comprehensive income (loss) as reported under Canadian GAAP	1,965	(28,014	)
IFRS adjustments decrease:
Deferred income tax on mineral properties (note (i))	6,441	7,858
Cumulative translation adjustment (note (iii))	17,989	17,989
Accumulated other comprehensive income (loss) as reported under IFRS	26,395	(2,167	)

21

GREAT BASIN GOLD LTD.

Notes to the Consolidated Financial Statements

For the three and six months ended June 30, 2011 and 2010

(Expressed in thousands of Canadian dollars - unaudited)

12. Transition to IFRS (continued)

(a) Reconciliation of equity and comprehensive loss as previously reported under Canadian GAAP to IFRS (continued)

(iv) Deficit

The following is a summary of transition adjustments to the Company’s deficit from Canadian GAAP to IFRS:

	December 31		June 30
	2010		2010
	$ ‘000		$ ‘000
Deficit as reported under Canadian GAAP	(294,625	)	(277,625	)
IFRS adjustments (increase) decrease:
Mineral properties (note (i);(ii))	(54,530	)	(54,530	)
2008 depletion (note (i))	1,657		1,657
2009 depletion (note (i))	941		941
2010 depletion (note (i))	1,771		922
Convertible debt (note (ii))	8,864		8,864
Cumulative translation adjustment (note (iii))	(17,989	)	(17,989	)
Deficit as reported under IFRS	(353,911	)	(337,760	)

(b) Adjustments to the statement of cash flows

The transition from Canadian GAAP to IFRS had no significant impact of cash flows generated by the Company except that, under IFRS, cash flows relating to interest are classified in a consistent manner under operating, investing or financing activities each period. Under Canadian GAAP, cash flows relating to interest were classified under operating activities.

22