November 20, 2007

Q: What milestones are the company looking to reach over the next year?

A: The current focus on Ashdown will next advance to the re-start at MR as Ashdown’s production continues to stabilize over the coming months.  Our goal in the last PP was to leverage value through low cost means including the re-establishment of reserves at MR by updating its feasibility study. This feasibility work is underway and involves several months to complete and can cost upwards of half a million dollars. Its success can bring 200,000 ounces of gold back onto the books, and at over $800 per ounce, this represents a significant asset. Similarly, we have negotiated leveraged settlements on several of our legacy debts and reclassified a large portion of those monies into capped NSR payments, greatly enhancing control over our cash flow. We have also successfully resolved all legal disputes inherited as legacy issues, and have no lawsuits pending. We extinguished over $6MM in debt, leaving our balance sheet in good condition compared to where we were two years ago.  Our next challenges involve our listing, our share capital structure and identifying the next mine opportunity beyond MR and NC.

Q: It’s been over six months since the PP with Sprott. Will you please comment on how that relationship has been progressing.

A: Sprott took a major position in the Company during the last PP, and were supporters of GPXM’s ballot initiatives at the AGM. Sprott’s market presence and the leadership they offer through their participation in the PP is part of a strong foundation as we prepare the Company for entry into the Canadian markets through listing on a senior board there. It is our goal to see this relationship grow as we ramp production of moly at Ashdown and prepare Mineral Ridge to re-enter the gold market after a three year hiatus.

Q: Can you comment on the current situation with WEX? Why has the dispute dragged on? Wasn’t the LLC set up to make these types of disputes easily solved? Have any dates for resolution been set? Please also comment on WEX’s claims against GP.

A: The LLC was set up to define the resolution of disputes through binding arbitration.  Binding arbitration is designed to accomplish this by laying out a step-by-step process that leads to a fair - and final - decision by a qualified third-party outside the formal court channels. In many ways, it operates like a court, but with less potential for delays. Nonetheless, it still involves the use of lawyers for each side, and can be subject to various motions and actions which take time.  It also involves the selection process for the arbitrator as well as requires the parties to attempt to mediate their issues first, which takes additional time.  In this case we are finally approaching the last steps in the process, and expect this matter to be resolved within the coming months.  The Company does not regard the counter-claims as substantive. We welcome a final resolution as soon as the process will allow.

November 15, 2007

Q: What is the current status of Mineral Ridge and what are the short and long-term plans for this property?

A:  MR is a diamond in the rough.  From the outside it appears to be a three-strikes property due to three consecutive attempts by three different companies to heap leach what was a proven vat leach operation with over 600,000 oz of gold production to its credit.  In reality, when approached as a milling and vat leaching operation the preliminary numbers look to be very robust. These are now being reviewed by third party experts to determine putting the property into profitable production.  The exploration potential on the property is outstanding. We expect our in-house work to be validated by the third-party feasibility work, and to then further expand the current resource significantly through infill and step out drilling over the next two years.

Q: Please comment on the possible expansion of Ashdown milling capacity to 200 tons per day. It has been noted there is mineralization at surface on the Ashdown property. Has open pit mining been assessed and wouldn’t this be easier than mining underground?

A: The expansion of the mill capacity is a function of the ability to mine and deliver ore on a sustainable basis.  We have been examining the possibility of an expansion and beginning the permitting process so that we can be ready to pull that trigger as soon as it make sense.  For the immediate future, management is concentrating on ramping up production to the full capacity of the existing mill. The underground development is really the step that will determine the feasibility of an expansion.  As far as open pitting this deposit goes, it is unlikely that the known mineralization would warrant the permitting lead time and capitalization required to convert to a pit. The narrow high grade nature of the vein is ideal for the surgical approach taken.  Having said this, if exploration drilling discovers mineralization of significantly different tenor and geometry, the optimal mining method will be re-examined.

Q:  What is the current status of the 43-101? Why has this report taken so long to put together? What resources are being used to compile the data and can we expect drilling on the property in the near future?

A: The feasibility study that underlies the NI 43-101 report is finally winding up, with the last of the engineering related to the mine plan being conducted over the next few weeks.  The length of time has been driven by the fact that we opened the mine before we had any of the background work completed, and we have had to put all of this preliminary work into place in order to complete the economic analysis and forecasting. Ironically, this work will basically confirm the feasibility of a mine that has already been proven through actual production. The value of the study is in providing institutions and analysts with documented reserves and ore cut off grades.  The fact that we have "proven" the economics will help the QP’s when they apply their stamps to the final reserve numbers in that they are not having to guess and take the chance that they missed something.

Q: What is the current status of the Gradient work that’s been done on the property? The June 12th PR reported collection of field data with the results to be analyzed over the next couple of weeks. That was five months ago. What are the results?

A: The work that Gradient Geophysics did for the project was taken to the preliminary stage of interpretation in the weeks following the gathering of data, and subsequently was held up due to difficulty in coordinating their schedules with our geologists to refine the models.  After many attempts to make this happen, we have taken receipt of the raw data and contracted with a third party to complete the interpretive work on the inversions and constraining the models prior to targeting drill holes based on the results.  This work will take several more weeks, and the results will be discussed when available.

Q: The OTBB exchange sucks. When can we move somewhere legit and what steps have been identified as necessary before a transition can occur?

A: Management recognizes the importance of migrating to senior trading platforms, and views the US and Canada as the two most desirable jurisdictions to do business in. The Company qualifies for the full Toronto Exchange (as opposed to the TSXV) and for the AMEX in all but our share price. The AMEX requires a minimum price of $2.00, which can either be accomplished through organic growth in value or through some form of business combination or consolidation event that would result in creation of that value.  This is a primary focus of the Company, and the recent authorization for an additional 250MM shares has placed us with the flexibility to take advantage of the right opportunity as it presents itself over the coming year.

October 29, 2007

Q:  Does Win-Eldrich hold any ownership interest in the Mineral Ridge or Northern Champion mines?

A:  No.  Win-Eldrich and Golden Phoenix are the two owners of the Ashdown moly mine, which operates under  a Management Committee structure, with Golden Phoenix serving as Manager of the property.  The Mineral Ridge gold mine and Northern Champion moly mine are assets of Golden Phoenix only, and Win-Eldrich holds no ownership interest in these two properties, either currently or in the past. 

Q:  I was pleased to see the price of Mo increasing recently. How does GPXM see future prices?  

A:  The industry consensus seems to be that Mo pricing will remain strong into next year. We are working to set up the Ashdown operation to maximize the timing of these prices, as well as to sustain profitability if prices eventually settle back into a long term average, as has been postulated by some moly analysts.

Q:  Assuming we begin full production at our present mill capacity, how many shipments would you expect per month and what would that mean in the way of a monthly or quartly projected income?  

A:  Beginning in 4th quarter (assuming full mill availability and feed from the mine) Golden Phoenix has set its expected baseline at a minimum of two shipments per month, with the objective of building production from that level. The number of monthly shipments, or rate of production, is sensitive to several indices, including head grades at the mill, and these grades are expected to remain variable until Ashdown completes the initiation of full scale stope mining and an ore blending program to modulate them. Revenues generated are dependent on the moly spot price (less the roasting and brokerage fees) which is subject to significant variability, but sales figures have been in the $500-600K range per shipment during most of 2007, and these prices are forecast by moly experts to continue into 2008.  

September 11, 2007

Q:  Is it true the Ashdown mill is not able to process feed with more than 1% moly in it? - W.N.

A:  No.  The mill has been routinely processing mill feed ranging between about 1% and 4.75%.  With the recent completion of new liners and ball charge, the ball mill is fully operational and is being assessed for the optimal feed grade that delivers the maximum Mo content with the minimum Cu and other impurities. 

     Over the past eight months of operation, the mine has delivered varying grades of feed to the mill.  This is expected to continue, as the narrow vein ore deposit fluctuates in Mo percentage between approximately 1% and 20%.  One key factor to the quality of mill feed is the barren rock dilution which occurs in concert with the drifting and stoping process.  At times, the miners are able to keep that dilution to a minimum and thereby keep the Mo content of the mill feed higher.      

     However, the miners are performing both ore extraction AND underground infrastructure work simultaneously, which can affect the grades coming to the mill.  There have been, and will be, times when in the course of putting in a drift or a raise or a loadout, additional barren rock must be moved, some of which may contribute to the mill feed and therefore reduce the average Mo percentage for that period.  This is a natural outcome of the simultaneous development/extraction process, which attempts to balance infrastructure and safety requirements with the daily demand for mill feed.  As development work leads to more working faces, the mine plan calls for increasing control of grades coming to the mill, through stoping and blending.  Optimization of the mill's ability to produce concentrates is also an ongoing process, which includes identifying the ideal feed grades to float, through a trial and monitoring process.

Q:  Rather than dilute our common stock by the addition of more shares, is it feasible for GPXM to buy back shares on the open market at the present low prices? We have a lucrative product and a terrific administration and crew. The shareholders have shown good faith in buying into GPXM, should not the Company also show some token of good faith?   - M.K.

A:  Yes, it is feasible for any public company to consider a share buyback program, especially when prices are low. However, GPXM has presently made no comment on this as a policy, for now or in the future.

     To clarify, the recent approval of the addition of Treasury stock by an substantial majority of shareholders does not imply that the float has been diluted as a result.  Treasury shares remain in the Treasury until issued, and therfore only affect the dilution if and when, and to the degree, they are deployed. 

     A public company without Treasury shares is a company without its full range of options to develop and grow.  The wise use of shares to perform value-added work is the ideal purpose of having the shares available to begin with, and without them there is little reason to remain "public." Also, as discussed at the Annual Meeting, in a predator/prey environment, a public company without Treasury shares may appear vulnerable to outside intervention. 

     In part, it may not be the existence of Treasury shares that is at issue, but the question of the Company's ability to wisely manage that resource to the benefit of the shareholders. 

     As for the question of showing good faith, there are many ways by which a company can and should acknowledge its shareholder's support.  Principal among them is the consistent and honest effort to build value.

Q:  Are there any photos from the recent Mine Tour available for those who could not attend?  - K.B.

A:  We are hoping to put together some visuals of the Mine Tour and make them available through the website in the coming weeks.

August 7, 2007

Q:  We've been keeping a close eye on the web site and noticed lately that the usual informative communication has been rather sparse. Any reason? - B.B.

A:  The SEC requires a "quiet period" to be observed by public companies during the period that a stock registration is in progress.  This means that companies must observe strict limits to certain types of public communication during that period.  The PIPE financing that occured at the beginning of the summer was just such an event.  The registration has just recently been completed and the "quiet period" is now over. 

Q:  I am looking forward to the Annual Meeting coming up in September.  I received my proxy statement and wanted to know the reason for Proposal 4 - Change in Capital Stock? - D.B.

A:  'The Company has only 1,759,607 shares of common stock available for future issuance.  If the shareholders approve the proposal, newly authorized shares of common stock will be available for issuance by the Board for stock splits or stock dividends, acquisitions, raising additional capital, stock options, and other corporate purposes.  The Company believes that this increase in the number of authorized shares is appropriate and in the best interests of the Company because it would afford us with the flexibility of issuing a higher percentage of equity than debt in connection with a potential transaction.  Such potential transaction could involve, among other things, issuing shares of the Company's common stock in order to (i) finance a merger or acquisition (ii) refinance our exisiting credit facility and/or (iii) raise additonal capital to accelerate our mining operations.' 

     We refer you to the recently issued proxy statement that contains detailed information regarding this and other proxy matters designed to further inform the shareholders.

Q: So why do we want to reincorporate the company from Minnesota to Nevada [Proposal 3] ? -S.W.

A: 'Our Board of Directors believes that the Reincorporation will benefit the Company and its shareholders by giving the Company more flexibity and simplicity in various corporate transactions and reduce the cost of doing business. The State of Nevada is recognized as a desireable state to do business because it has favorable corporate income tax treatment, nominal annual fees, and the identity of individual shareholders are not public record. Furthermore, the Nevada General Corporation Law (the "NGCL") provides a recognized body of corporate law that will facilitate corporate goverance by our officers and directors.'

April 17, 2007

Q:  I have seen no reports of deliveries of moly
concentrate since the 3rd shipment on Feb. 22nd. Is there a problem with the product not being up to standards, or drilling problems , etc?  Are there difficulties resulting in the delay in shipments?  - M.W.

A:  To the contrary, following rigorous metallurgical work in March, the product being produced is well within specifications as to moly content and copper suppression. The mine and mill continue to operate.

     It should be explained that, in our ongoing effort to comply with SEC standards, we are adjusting our reporting protocols.  Sarbanes Oxley rules are being observed in our communication processes, which can affect the frequency and nature of our reports. We are reviewing these protocols now, and will establish a methodology for reporting sales, and all website updates, in the near future.  Until then, we will continue to produce and sell product. 

Q:  Past statements indicated the purchase of the Northern Champion property. However, your website does not have any information on this property. Please advise on the status of this property and what is planned for it. - M.B.

A:  Northern Champion is an historic moly mine located in central Ontario.  It has an NI 43-101 study showing reserves and resource of about half a million pounds of molybdenum, occuring often in crystaline form near the surface.  The website will be developed this spring, as weather permits us to start work on the property.  Some exploration work has been initiated  in the past, and more is planned for the future.  Once the Ashdown project is ramped, the Company hopes to direct resources to Northern Champion, and accelerate its evolution during 2007.

February 23, 2007

Q:  In going to a 7-on 7-off work schedule at Ashdown, it sounds like we'll have 50% less working hours.  How are you going to compensate?  D.B.

A:  Please don’t confuse workers with working slots. The mine will operate seven days a week. This formula allows for smooth cycling of workers in and out of positions round the clock every day of the month, and avoids split shifts and change-of-shift gaps that, in the past, have reduced efficiency.  It can increase our housing capacity as well, by allowing for rotational sharing of facilities, and it means that we can draw employees from a wider geographical area, providing them extra days to travel to and from their homes.  It may also reduce burn out, as the former 10-on 5-off schedule was physically exhausting, especially when the miners were working 10-hour shifts.  In short, the new work schedule is intended to promote worker performance and loyalty while alleviating housing pressures. It will require hiring additonal miners, but this is expected to be easier to accomplish with the worker-friendly schedule.

February 5, 2007

Q:  Is there more to the story of Ken Ripley's leaving?

A:  When Rob Martin first approached the Board of Directors with the idea of revitalizing the company near the end of 2004, the Board asked who might help make that happen.  Rob suggested a life-long friend and business associate of his, Ken Ripley, who at the time was living in semi-retirement with his family near Seattle.  Rob knew Ken had the talent, experience and business acumen needed to jumpstart the process. Always ready for a challenge, Ken generously agreed to assist.  At the time, it was felt that Ken might only be needed for three-to-six months.  That was 24 months ago.  During that period, Ken put his life on hold and gave 110% to the effort of improving the company and building the Ashdown mine.  He lived on-site at the mine for months during the freezing winters and searing summers.  He worked with his hands as well as his mind.  He gave not only his time, but also his equipment and his funds. The Board is deeply indebted.

     When Ashdown sold its first shipment last week, in essence, Ken had delivered on his promise to the Board to restore the company and create a working mine.  While he was encouraged to remain active within the company structure, Ken now wishes to return to his private life in order to spend more time with his daughter Kristen and son Kyle. He remains very supportive of the company and has made himself available for advice and input as we move to the next level. 

     Our hats are off to Ken for a job truly well done.

January 20, 2007

Q:  I'm a long term holder of GPXM (2 1/2 years). Now that GPXM has "all its ducks in the water" - production, management, licenses, and moly sales - the stock drops 20% instead of going up 20%. Is the resolution with WEX going to be resolved quickly, or turn into a 6 month "battle" ? T.L.

A:  The "battle" you refer to regarding Win-Eldrich Gold, Inc. (“WEX”) is, as we see it, a disagreement relating to the rights and responsibilities of WEX and GPXM, as partners of Ashdown Project, LLC (“LLC”).  The disagreement arises out of WEX’s failure to make a required payment under a Letter Agreement entered into by both parties. GPXM believes that, as provided in the remedy provision in the written agreements between the parties, the default results in a dilution of WEX’ ownership interest in the LLC from 40% to 30.5%, and a corresponding increase in GPXM’s ownership interest from 60% to 69.5%.  WEX has indicated to us that it disagrees that it is in default under the Letter Agreement. 

      The Operating Agreement and the Letter Agreement entered into by both parties appears to identify the remedies available upon default and the methodologies for resolving any disputes that may arise, including mediation and binding arbitration.  It is GPXM’s intention to resolve the disagreement in an amicable agreement or under the methodologies provided in the written agreements. One cannot predict the length of time it may take to explore these methodologies.

     It may be instructive to keep in mind that the LLC holds the assets of mine and mill as an entity, and not by individual partners. The LLC has been continuing operations as usual without any disruptions. 

     GPXM anticipates that its operations will also continue as usual and that the disagreement will not have a material adverse effect on the LLC’s operations or GPXM’s financial condition or results of operations. 

      Regardless of the outcome, GPXM’s ownership interest in the LLC will at the very least remain at 60%, and possibly increase to a maximum of 69.5%.  GPXM believes that any issues between GPXM and WEX can be processed in a timely and professional manner by all parties. 

December 21, 2006

Q:  Congratulations on starting to make saleable moly concentrates.  You report 52% to 57% Mo content.  As you improve the milling, how much higher can this content be? - N.D.

A:  Typically, Mo (or elemental molybdenum) content in commercial grade concentrate will be between 50% and 53%.  Content that exceeds 55% Mo is considered top quality. Maximum Mo content generally does not exceed 58%.

Q:  I am confused.  I thought your recovery of moly was supposed to be 80% or higher?  Why only 52-57%? -  R.K.

A:  You are mixing apples and oranges. Those two sets of percentages represent different measures.  

     On the one hand, your 80% figure refers to the percentage of Mo (elemental molybdenum) in the mill feed which is captured by flotation and does not end up in the tailings pond; our metallurgists are always working to achieve consistent recoveries of 80% (or more) of the Mo contained in the mineralized rock that is fed into the mill. 

   Once that Mo is separated from the rock, it is then processed into a concentrate that, for commercial sale purposes, should contain at least half (50%) Mo, with the rest of the concentrate being inert rock and trace minerals. 

   So on the other hand, the 52%-to-57% figures refer to the amount of Mo (as a percentage of the total concentrate) in the supersacks.  Typically, these concentrates will contain approximately 50% Mo on the low end and 58% Mo on the high end.  As stated above, producing a cons with 55% Mo or greater denotes a top quality product.

September 5, 2006

Q:  With the Ashdown partnership agreement basically worked out, what will take place over the next few weeks to complete the process with WEX? - S.R.

A:  The process continues to proceed as scheduled. It began with the August 31st issuance by Win-Eldrich of its estimated quarterly contribution, totaling $550,000, wired directly into Golden Phoenix's operating account, as planned.  In the weeks prior to September 30th, the two partners will compare financial reviews for determination of the exact quarterly contribution amount and make any adjustments, as well as perform the same process regarding the calculation and issuance of Golden Phoenix's 60% share of the stock pile net proceeds. The LLC, which will hold the Ashdown mine and mill, is being formed by the attorneys during this period, and it is anticipated that all documents can be completed and executed within the alloted time frame.  Please refer to the issued Form 8-K for a more detailed discussion of the steps involved.  

Q:  Will GPXM be attending the Gold Show in Las Vegas this week? - A.C.

A:  The Company is not hosting a booth at the show, however Rob Martin will be there Wednesday, September 6th.  If you are in LV and wish to contact Rob, please call the office and leave a number where you can be reached.

May 31, 2006

Q:  I noticed the moly price is no longer listed on your homepage.  Is there are reason?  - C.M.

A:  Yes. Our web supplier, theFinancials.com, recently lost its source for current moly concentrate pricing.  They are in the process of solving that issue, and we hope to have the prices reported again, as soon as possible.  In the meantime, the last price listing we received for moly concentrate was $26.50 per pound.

May 25, 2006

Q:  I am wondering if O&M partners has begun its "awareness campaign" on behalf of GPXM, and if so how long it might be?  -W.H.

A:   Yes, as reported in a press release, Otis & Mandy, a consulting service based in New York, is setting up a series of presentions.  Beginning two weeks ago, Dave Caldwell and Rob Martin made ten 2-hour presentations in New York and Boston to investment houses and money managers.  The presentations were attended by company presidents, directors, fund managers and market analyists.  The purpose of the meetings was to introduce key market players to the GPXM story. The reception was cordial and very attentive.  A typical interaction might start with "I can only stay 40 minutes"  and end two-hours later with "We are sorry but we have to leave for our next appointment."  O&M delivered quality introductions and attended every meeting.  They are planning our next trip.  We are scheduled to repeat this program over the next sveral months, and may revisit the east coast, as well as Atlanta, Chicago and San Francisco.  This is designed to be a "rifle-shot" approach to building awareness, targeting "early adopters" who are resource-oriented and aggressively seek positions in emerging opportunities. 

May 20, 2006

Q:  I read on Raging Bull that the POO has been delayed due to"inexperience by the contractor who wrote the document for GP and the fact that there are 12 'signatures' from various agencies required."  Why are you using an inexperienced contractor, and why so many agencies?  - W.C.

December 22, 2005

Q:  Is it not in the company's best interests to be drilling and proving up additional moly reserves NOW in order to extend Ashdown's mine life beyond a matter of months?  - D.B.

A:  Your interest in seeing if the Ashdown moly deposit can be expanded is right on target.  It is our interest too. The challenge is three-fold:  1) it takes money to explore, so once we are in moly production, the funds are expected to become available; 2) the SEC rules governing the reporting of resource and reserves are very stringent and therefore costly, so as we go about expanding the inferred mineralization, we need to do it in a manner that is both cost-effective and can pragmatically help guide our future extraction decisions; and 3) drilling will require lead time to reserve the equipment and warmer weather to improve the working conditions. Dave Caldwell has been working on exploration planning over the past several months, well in advance of our commencement of mining and milling. So the company continues to work its restructuring plan methodically, laying a carefully-designed foundation for future activity.  Given limited resources, this is the business-like approach management has chosen. Nonetheless, your desire to see exploration at Ashdown is in line with ours.  
        As for your characterization of Ashdown as having only "months" of supply, our view is substantially longer at this juncture, pending corroboration and further exploration.  That is because, while the company has published figures on the inferred mineralization contained within the "target moly deposit," it has also published figures explaining that the "target" is a narrowly defined core of 21,550 tons of high-grade material which we have reason to believe is encapsulated in a larger deposit of lower grade material extending both up dip and down dip. Records indicate that the lower grade material may assay between 1-and-3% mo, as has been reported in past releases.  And 1% rock, which is equivalent to 20 pounds mo per ton, is valuable commercial grade material, especially at recent prices, and might therefore support mining operations for many additional months.

December13, 2005

Q:  This morning GPXM opened a nickle lower than the previous close.  Is there any bad news that may have caused this to happen? B.S.

A:  No.  The last item reported just 15 hours ago on the Golden Phoenix website was the successful completion of the tailings impoundment at the Ashdown mill. Progress continues at its current pace toward the opening of the Ashdown mine. Today's trading anomaly appears to be of exogenous origin.

December 12, 2005

Q:  I am confused about how the value of the moly concentrates will be determined when it is time to sell our product.  Can you explain in simple terms? - R.D.

A:  Molybdenum is traded on the world markets in a form of concentrate called molybdenum oxide.  The price that is quoted is paid only for the elemental moly present in the oxide concentrates.  This is determined by weight and assay and can vary from batch to batch.  For example, if the average weekly moly oxide price is $30.00, then the producer will receive $30.00 per pound for the elemental (pure) moly contained within the oxide concentrates.  This elemental moly is typically between 50% and 70% of a concentrate's gross weight, and can vary with each Supersack.  In our case, we will be selling molybdenum disulfide, which is the unroasted form of the oxide concentrates.  Roasting at high temperatures converts the sufides to oxides.  By avoiding this step in production, we will simplify and speed up the sale of our product.  In turn, the buyer has the right to deduct a roasting fee from the average weekly oxide price, as it will cost him that amount to perform the roasting later.  The broker's roasting fee is subject to change in accordance with world roasting capacity and price points, and will be part of incidental costs incurred at the time of sale.  To speed the sales transaction, the Company will have the option to be paid 90% of the shipment's value FOB the millworks, with the remaining 10% to be paid after final smelting.

Q:  How will weather affect moly production?  - R.R.

A:  Apart from minor interference with the moving of men and material to and from the mine and mill, none of the critical functions of the operation will be exposed to weather.  The mining takes place underground where the temperatures remain fairly constant, and the mill will be fully enclosed and heated.  Snow and ice on the two miles of road between the mine and mill may occassionally pose a minor inconvenience to the operation from time to time, but it is not anticipated to be a production-limiting factor.  Cold weather can affect power transmission as well as the flow of well water, both of which can be ameliorated with proper maintenance procedures and backup systems.

December 1, 2005

Q:  I read somewhere that BLM may unexpectedly require the company to dig an extra decline to serve as an emergency exit at Ashdown, which could delay both completion of the Plan of Operations and the start of moly mining into the spring. Is this true? - L.P.

A:  No.  The Plan of Operations, as originally submitted to BLM last year, already includes a secondary escape shaft, in accordance with MSHA requirements.  The shaft was included in the POO which has already been reviewed by BLM.  The shaft is designed to serve not only as an emergency exit, but also to provide ventilation and an additional access way for movement of material, specifically to host a sand line for use in backfilling stopes.  GPXM does not expect any delays in Plan approval or start of production due to the issue of a secondary escape route.

Q:  Win-Eldrich stated in their recent press release that the Ashdown agreement was not finalized.  If correct, how does this affect the progress at the mine and Golden Phoenix?  B.M.

A:  Development of the Ashdown Mine has been undertaken in accordance with the terms of the binding agreement signed by both parties on February 4-5, 2004.  In addition to laying down the principal terms of the partnership, that agreement calls for the preparation of a more detailed Form 5A, which is a standard joint venture format used in the mining industry.  The purpose of a 5A is to fill in the numerous smaller details of how the partners will work together, going forward.  It is an elaboration of the underlying agreement, not a replacement or renegotiation of that agreement.  Both partners have been exchanging drafts of the 5A over the past year as part of the normal writing process, and both partners continue to work toward its completion in an open and timely manner.  In the meantime, the February 2004 agreement authorizes and directs GPXM to perform all the duties of manager/operator of the mine, including its development and start-up. 

October 3, 2005

Q: Now that the Ashdown bypass is over 20% of the way to the moly deposit, what can you tell us about the rate of progress and possible arrival date? - M.M.

A: Speed of progress is directly proportional to the underground conditions. The initial stage of the drift has encountered volcanic tuff, which is frangible rock formed from consolidated ash. It is similar material to that which collapsed in the old decline. It becomes more unstable in the presence of water. It requires our crews to timber every six feet and heavily batten the cross-cut to prevent cave-ins.  Generally speaking, each 10-hour shift can drill, blast, muck, timber and batten between 6 and 9 feet of drift. Two shifts can double that progress. If and when our crews intercept more stable rock, the pace may change, possibly due to reduced timbering. Additional time will be required to develop working stopes to provide underground areas for equipment and materials, and to extend pneumatic air lines and ventilation. And there is the ever-present possibility of encountering water. Safety is always the primary goal. This new decline will serve as the main haulage way once the mine is in full production. Therefore, care is being taken to make it strong and stable. The Company now estimates arrival at the moly deposit to occur in November, barring unforeseen delays.

Q: Assuming the company successfully removes and processes the 1000 ton bulk sample, how will the revenues from any sale be distributed? - D.S.H.

A: Distribution of revenues will be reported in the Company's 10Q filing following commencement of sales. Until sales occur, there is no way to reliably calculate the amount of concentrates produced nor the production costs involved. In general, all production costs are to be deducted from the gross revenues first. The remainder is then apportioned, 60% to GP and 40% to our JV partner. The financings that made the mining and milling possible
will receive 15% and 12% of gross revenues per sale, respectively, until both financings are retired. Those portions of the financing costs which are not categorized as production costs will be paid from GP's share.

October 2, 2005

Q:  Could you update shareholders as to the current status of the "standby equity capital" financial package signed with Fusion Capital in July 2005? As well, could you provide circumstances under which this option may be activated? - D.S.H.

A:  The Fusion Capital equity line is currently being registered with the SEC.  This process can take up to several months.  Until then, it is not available to the Company. The value of Fusion's role in the Company's development is to be ready and willing to provide funds through purchase of stock in the event it is deemed necessary. The terms of the financing call for the Company to receive $200,000 once registration is completed. Beyond this, at present the Company has no plans to make use of this source of capital.  

September 6, 2005

Q: Is Golden Phoenix participating in the Las Vegas Gold Show this week? - R.B.

A:  No.  GPXM is scheduled to return to the tradeshow circuit this coming November, and has reserved a booth at the San Francisco Show. We invite our shareholders to come visit us, and will provide detailed information about the show as we get closer.

September 4, 2005

Q:  I am a present investor with 70,000 common shares.  I have held this stock over two years.  About a month or two ago, I phoned GPXM. Recently, I have completed reviewing GPXM to see if my original basis for investment is in place.  Be assured that the business-like advancement of the company is obvious.  The acquisition of the new mill at I assume a bargain price is indicative of your business practices.  Your on-going plan to mill and sell moly should provide funds to develop the company without diluting share holder equity in the future.  Present funding which is the sale of stock at market prices seems to me to be a plus too.  I like the forward moving actions to mill the heaped gold.  The one change which further encourages me is your plan to explore for more gold on the mine's property. You would not be hearing from me if I had no concerns at all.  Therefore, here it is:  We are going to have a recession in 2006.  Moly prices are going to decline along with commodity prices in general.  I feel that GPXM's moly ore grade is high enough that the bags can still be sold at good profits.  Longer term, moly is going to rise in price over the next several years.  I wish to stress that I think the business plan is solid.  I like it.  Gold prices should rise significantly through 2008 or 2010.  Shouldn't GPXM, therefore, look to create the opportunity to grow with some kind of blue sky open-ended exposure to gold?  Can't the present plan to explore for more underground gold on-site be expanded into significantly higher gold reserves?  Soon as the cash flow from the moly begins, shouldn't funds be directed to acquiring and or developing gold prospects?  At the time of my phone call, GPXM was in the process of establishing a position of investor relations.  My thinking is that investors would respond to news of a mining company which is being solidly developed and pursuing even greater share holder equity.  Naturally, higher stock prices for GPXM will lower the cost of growing the company. Your response is appreciated and thanked in advance.  My background is in petroleum marketing at Tulsa University, international business education at Thunderbird, and ownership/management of a small information management company.  I am a 20-year investor in mining companies.  – N.K.

A:  Dear N.K., thank you for the positive assessment and insightful analysis.  The general answer to your questions is embodied in the Company’s mission statement which declares that GPXM “is committed to deliver value to its shareholders by acquiring, developing and mining superior precious and strategic metal deposits in the western United States using competitive business practices balanced by principles of ethical stewardship.” [Emphasis added]  Beginning this year, management has been (and continues to be) restructured, company finances bolstered, and mining operations focused on delivering value to the shareholders by targeting near-term production of moly, while simultaneously readdressing its gold resources, particularly at Mineral Ridge.  This process will continue until results are achieved, at which time the Company should be in a position to broaden its future options.  By the Company's own definition, those options will always include consideration of the expansion, acquisition and development of precious metals deposits.  The name is GOLDEN Phoenix, and we take that to heart.

August 27, 2005

Q:  I'd like to learn more about Earl Harrison, our Mine Manager.  What more can you tell us about his background in mining and how it relates to the type of mining and milling he will have to do at Ashdown and Mineral Ridge? - D.T., Brazil

A:  Earl has nearly 40 years experience in the field of underground mining.  We have expanded his Bio to better describe his skills and experience.  Go to the "Company" button and pull down "Managers" where you will find his photo and expanded resume. You may need to hit "refresh" to bring up the latest version.

August 18, 2005

Q:  It appears the amended Notice of Intent
has placed GPXM on a firm footing towards production at Ashdown. Can you explain in more detail what is involved with "milling," "metallurgical testing" and "trial-marketing?" - D.S.H., Houston

A.  The 1000-ton bulk sample provides GPXM with an opportunity to set-up a learning program for processing and selling the molybdenite prior to full-scale mining.  The bulk sample is scheduled to be used as start-up feed for the 100-ton flotation mill to be built adjacent to the mine.  "Milling and metallurgical testing" refers to conversion of the ore into marketable concentrates that are assayed for purity, consistency and grade.  It is expected that adjustments will need to be made in the processing procedures, such as adding flotation cells, altering addatives, or inserting a re-grind circuit, etc.  The tailings generated will be measured for residual moly, and this will provide a guide for tuning the mill. "Trial-marketing" involves producing a final concentrate that meets the minimum purity requirment of the broker.  Contaminants such as base metals and waste rock have strict percentage limits, and the mill must generate a final product that will be accepted for purchase.  Supersacks of moly concentrates, containing up to 4000 pounds each, will be loaded and then tested at the mill prior to acceptance and delivery to the broker.  Revenues generated by these trial sales will be comparable to those generated once full mining operations are permitted.  These revenues may be significant, depending on the grade of ore and final purity of the concentrates.  At current prices, one Supersack of moly can be worth $70,000 or more, and a 1000-ton sample grading 8% can result in over $4 million in sales.  The key to success is the efficiency of the mill, which in turn, will be established through trial-and-error and fine-tuning of the bulk sample.

July 21, 2005

Q:  In the future, would it be possible to post a date on the Questions and Answers in this section in order to make it easier to follow?

A:  Happy to oblige.

Q:  It was announced several months ago that construction was beginning on the Ashdown Mill?  What is the status of construction?

A:  In order to build and operate a mill on the 20-acre mill site, the Company must have a county building permit and a Water Pollution Control (WPC) Permit issued by the Nevada Division of Environmental Protection (NDEP), plus corollary permits, inspections and approvals.  In May, the Company received its building permit from Humboldt County and a short time later got permission from NDEP to move equipment onto the site. The Company submitted documentation to demonstrate that (a) the foundation and building which will house the mill is permitted to remain on the property for use by the landowner after the mill has been shut down and removed, and (b) therefore, the foundation and building are not an “integral part” of the mill itself, but simply the place where the mill will be situated.  This documentation was submitted with the understanding that the Company should be allowed to pour the foundation and erect the building as non-intergral components, in advance of receiving its WPC Permit.  Agency response was favorable to this approach and it was stipulated that the Company post all necessary bonds.  The bonds were posted in June, as requested.  However, just before foundation work was to begin, an internal NDEP review resulted in reinterpretation of the regulations designating the foundation and building “integral” to the mill.  As a result, pouring of the foundation was suspended pending the Company’s subsequent request to allow the work to proceed. While the issue is being resolved, equipment continues to be moved to the site, and advance preparations are being made so that once approval is granted, whether before or after the WPC Permit is issued, mill construction can proceed quickly.

Q:  When will the annual stockholders meeting take place?

A:  No date has yet to be scheduled for the Annual Stockholders Meeting.  The Company has determined that before the Meeting is called, progress on corporate restructuring, refinance, and mining initiatives shall have advanced further.  Until then, shareholders are encouraged to contact the Company directly with requests for information.

Q:  Can you please explain more about the Ashdown mine versus mill property; how they are related and how they are not? 

A:  The two properties are not legally tied to each other.  One is public, the other private.  The Ashdown Mine is comprised of 101 mining claims held by Win-Eldrich Mines, Ltd., our joint venture partner.  The claims cover approximately 2,000 acres of public lands on Mahogany Mountain in the Pine Forest Range of northwestern Nevada.   The Bureau of Land Management (BLM) is the federal agency charged with the administration of these lands, and therefore guides much of the permitting associated with the mine.  The Ashdown Mill, which will process the ores produced from the mine, is slated to be built on a 20-acre parcel of private land, which lies about one mile southwest of the claim group.  This parcel is owned by Mr. Morris, who leased it to Golden Phoenix for the purpose of siting the mill.  The land is level and large enough to allow for the construction of a tailings impoundment sized to support a “small scale” mill operation. Reference has been made to the Ashdown “project” and the Ashdown “property” interchangeably.  Both terms refer to the package of lands, claims and permits that make up the producing mine and mill complex.

Q: I was under the impression that work was going on at the Ashdown mill site (concrete pouring, building set up, mill assembly, etc).  Can you clarify this?

A:  To date, construction has not been fully authorized to begin at the Ashdown mill site.  The Company has been issued a building permit from the Humboldt County Building Department, permitting the construction of the 100-ton mill facility.  However, before proceeding with construction, Golden Phoenix is awaiting follow-on approvals from the Nevada Division of Environmental Protection (NDEP) and Bureau of Land Management (BLM). There exists some degree of latitude in this regulatory process, and a final determination is still in process. The Company continues to work with the agencies to clarify which steps, if any, can be taken to advance the mill while ancillary permits are being processed. The Company is prepared to commence construction immediately upon receipt of authorization.  Shareholders will be notified by public announcement as soon as authorization is final.

Q:  What are the details of the financing for the mill, announced in May?

A:  The mill financing, announced in a past news release, is still in process.  Once it is completed, a Form 8-K will be filed reporting all material details.

Q:  Ashdown contains both gold and moly mineralization.  Can you clarify the physical relationship between the gold and the moly?

A.  From the available data, it appears that the gold mineralization at Ashdown occurs separately from the moly mineralization.  The deposits are separated into two distinct veins with the moly vein (Sylvia) underlying the gold vein.  The moly occurs in quartz veins that are not oxidized, and contains molybdenite, pyrite and chalcopyrite (copper). The gold occurs in quartz veins that are oxidized, i.e. contains no sulfides, with a brown limonite residue remaining. Historically, gold has been found in the upper reaches of the mine (Level 10), with the moly occurring below the gold (in and around the Sylvia fault).  While it is possible that moly and gold may be co-mingled in sections of the geologic envelope, to date there is no evidence that the two metals occur together in commercial quantities.  Past data collected at Ashdown regarding gold mineralization is being analyzed.  During the course of moly mining, Golden Phoenix will explore for additional moly deposits and analyze any promising gold mineralization that may be encountered. For the present, Golden Phoenix is preparing to mine and process molybdenite and defer development of a gold processing circuit.  Gold ore, if encountered, can be stockpiled for future use.

Q:  What are the estimated monthly production numbers for moly once Ashdown is up and running?

A: [Note: The following figures are theoretical and for illustration purposes only. Actual figures can be expected to vary, and readers are advised not to rely on these projections for investment purposes. Please refer to Forward-Looking Statements in Spotlight.]

To answer this question, it is first necessary to establish a set of assumptions:

• The Ashdown mill is presently planned to a design capacity of 100-tons per day.
• The mill will be set up to produce molybdenite concentrates.
• Daily molybdenite production will vary with ore grade, production levels, processing factors, equipment performance and maintenance requirements.
• Applying an 85% recovery-efficiency factor (based on previous metallurgical testing) moly ore averaging 5% grade should yield approximately 85 pounds of molybdenite per ton or 8,500 pounds per 24-hour day of continuous operation.
• The mill is estimated to operate 25 days per month, allowing for both scheduled and unscheduled maintenance.
• The known grade variance occurring within the Sylvia structure ranges from 0.25% to 15% based on past sampling. Over the bulk of the 21,500 tons that are estimated to comprise the targeted Sylvia ore chute, statistical modeling indicates an average grade of approximately 8% (undiluted). Within this envelope, actual grades may vary widely.
• Applying a 37.5% dilution factor (which can be expected to occur during extraction of the ore material) will yield a probable mill feed grade averaging 5% moly.

Given these assumptions, the theoretical monthly production of concentrates would equal 212,500 pounds of saleable product.  

Q:  Does the current private financing arrangement for the mining operations contain penalties for not making a payment on-time?

A:  Please refer to the two-page loan agreement which is produced in its entirety in the Form 8-K filed on May 16, 2005.  There are no other governing documents associated with this loan. 

Q: How many ounces of gold are currently being produced at Mineral Ridge?
A: During the first five months of 2005, Mineral Ridge produced 966.37 ounces of gold and 627.48 ounces of silver.

Q: When do you expect to start up the Ashdown Mill?
A: Our current schedule calls for the mill to be up and running before the end of summer 2005, subject to permitting and other considerations.

Q: Are investors welcome to visit the Company headquarters in Sparks?
A: Yes, we appreciate meeting our owners in person, and suggest you call in advance to arrange a visit.

Q: With the recent announcement by Win-Eldrich that they will be removing and processing the molybdenite stockpiles at Ashdown, what does this mean in terms of the on-going relationship between the two joint-venture partners?

A:  Golden Phoenix has informed Win-Eldrich that while the two companies do not agree on the question of whether the stockpiles are part of the joint-venture, there is no disagreement as to the actual removal and processing of the material.  Golden Phoenix considers Win-Eldrich a valuable and respected partner, and the working relationship between the partners' officers and project managers remains positive and sincere.  The issue of how the proceeds from the sale of the stockpile concentrates will be divided has been reserved for a future time, and Golden Phoenix fully expects the question to be resolved in a friendly and businesslike manner, without recourse to formal means whatsoever.

Q:  Originally, there was discussion of a 750-ton mill for Ashdown.  With the permitting moving forward on the 100-ton small scale mill, what has become of the larger mill?

A:  Early on in the development process, some consideration was given to the possibility of open pit mining at Ashdown.  But with completion of further analysis, it is currently the decision of Golden Phoenix to concentrate on underground mining for both molybdenite and potentially for gold.  This decision was a result of numerous factors, including the nature and size of the deposits and the lengthy and exhaustive permitting process that an open pit would involve.  By concentrating on low-impact underground mining, and utilizing the advantages of the extraordinarily high-grade moly mineralization, Golden Phoenx now believes that its 100-ton mill capacity will be more than adequate for the foreseeable future.  The mill facility's layout will allow for the addition of a second processing circuit, if and when the time comes.