Quarterly Numbers

BOREALIS EXPLORATION LIMITED

INTERIM CONSOLIDATED STATEMENT OF CASH

FLOW FOR THE NINE MONTH PERIOD ENDED

DECEMBER 31st, 1996

(Unaudited)
December 31 December 31
1996 1995
Operating Activities
Operating gain/(loss) $ (948,840)$ (2,443,480)
Items not affecting cash
Write down of Properties
Abandoned & Sold --2,346,196
Amortization870 290
947,970 (96,994)
Changes in non-cash working balances
Accounts receivable(increase) ----
Accounts payable (decrease) 63,965(51,688)
63,965 (51,688)
$ (884,005) $ (148,682)
Financing Activities
Advances from (to) a shareholder, net $ (42,821) $ 216,709
Shares issued in subsidiary companies 1,241,3486,176
Proceeds from issuance of share and stock

options


2,261,931

--
$ 3,460,458 $ 222,885
Investing Activities
Advances to an affiliated company $ (2,542,955) $ (54,248)
Exploration and development expenses

deferred


--

(8,043)
$ (2,542,955) $ (62,291)
Increase (decrease) cash $ 33,498 $ 11,912
Cash (bank indebtedness) beginning of period $ 2,430 $ (5,599)
Cash (bank indebtedness) end of period $ 35,928 $ 6,313

BOREALIS EXPLORATION LIMITED

INTERIM CONSOLIDATED BALANCE SHEET

DECEMBER 31st, 1996

(Unaudited)

ASSETS
December 31 December 31
1996 1995
Current Assets
Cash$ 35,928 $ 6,313
Marketable securities 1,29512,545
37,223 18,858
Share subscription receivable 173,000
Investment in shares 156,7281,728
Mineral properties, including deferred

exploration and development cost

and fixed assets



5,361,269


5,814,652
$ 5,728,220 $ 5,835,238

LIABILITIES
Current Liabilities
Accounts payable$ 1,998,737 $ 1,934,772
Loans payable-- 430,546
Payable to shareholders 491,110884,109
$ 2,489,847 $ 3,249,427
Royalty payable2,567,813 2,567,813
$ 5,057,660 $ 5,817,240

SHAREHOLDERS' EQUITY
Capital Stock:
Authorized 5,000,000 common shares
without par value
Issued (1996 - 4,148,345 shares)
(1995 - 3,232,498 shares) $ 25,262,462$ 22,829,764
Shares issued in subsidiary companies 1,241,348--
Contributed surplus 4,919,5394,896,520
Deficit(30,752,789) (27,708,286)
670,560 17,998
$ 5,728,220 $ 5,835,238


BOREALIS EXPLORATION LIMITED

INTERIM CONSOLIDATED STATEMENT OF LOSS AND DEFICIT

DECEMBER 31st, 1996

(Unaudited)
December 31 December 31
1996 1995
General and administrative expenses
Interest and exchange $ 14,840 $ (96,968)
Other general and administrative expenses 1,290,530173,589
1,305,370 76,621
Other Income (Expenses)
Write down of Mineral Properties --(2,346,196)
Revenue356,530
Management fees --(20,663)
356,530 (2,366,859)
Decrease (increase) in deficit (948,840)(2,442,480)
Deficit, beginning of period (29,803,949)(25,264,806)
Deficit, end of period $ (30,752,789)$ (27,708,286)

BOREALIS EXPLORATION LIMITED

401 BARCLAY SQUARE

1300 EIGHTH STREET SOUTHWEST

CALGARY, ALBERTA T2R 1B2 CANADA

Phone: (403) 245-4306 or (503) 621-3286

Fax: (403) 245-4308 or (503) 621-3425

E-mail: pr@borealis.com

Web Site: http://www.borealis.com

INTERIM REPORT

DECEMBER 31, 1996