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TERYL RESOURCES CORP.

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

AS AT NOVEMBER 30, 2010

(Stated in Canadian Dollars)

Reader’s Note:

The accompanying consolidated financial statements for Teryl Resources Corp. (the “Company”) for the

six months ended November 30, 2010 have been prepared by management in accordance with Canadian

generally accepted accounting principles. These consolidated financial statements, which are the

responsibility of management, are unaudited and have not been reviewed by the Company’s auditors.

Management believes the consolidated financial statements are free of material misstatement and present

fairly, in all material respects, the financial position of the Company as at November 30, 2010 and the

results of its operations and its cash flows for the six months ended November 30, 2010.

TERYL RESOURCES CORP.

INTERIM CONSOLIDATED BALANCE SHEETS

(Stated in Canadian Dollars)

November 30

May 31

2010

2010

(Unaudited)

ASSETS

Current

Cash

14,424

260,150

Amounts receivable and prepaid expenses

38,166

40,375

52,590

300,525

Advances to Related Parties (Note 8)

144,195

126,093

Investments (Note 4)

1,458

837

Equipment (Note 5)

7,056

7,941

Mineral Property Interests (Note 7)

204,355

196,855

Deferred Exploration Expenditures (Note 7)

2,825,097

2,637,853

3,234,751

3,270,104

LIABILITIES

Current

Bank indebtedness

15,462

Accounts payable and accrued liabilities (Note 12)

54,416

107,394

Due to related parties (Note 8)

8,576

25,488

Liability component of convertible loan (Note 9)

58,730

78,454

191,612

SHAREHOLDERS’ EQUITY

Share Capital (Note10)

Authorized:

100,000,000 common shares, voting, no par value

5,000,000 preferred shares, non-voting, $1 par value

Issued and outstanding:

68,560,946 (May 31, 2010 – 67,463,446) common shares

13,605,247

13,456,263

Equity component of convertible loan (Note 9)

14,565

Share Subscriptions Received

229,999

10,000

Contributed Surplus

529,499

550,941

Accumulated Other Comprehensive Loss

(2,566)

(3,187)

Deficit

(11,205,882)

(10,950,090)

3,156,297

3,078,492

3,234,751

3,270,104

Going Concern (Note 1) and Subsequent Events (Note 15)

Approved on behalf of the Board of Directors:

“John Robertson”

Director

“Jennifer Lorette”

Director

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

TERYL RESOURCES CORP.

INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Stated in Canadian Dollars)

(Unaudited)

Three months

Three months

Six months

Six months

ended

ended

ended

ended

November 30

November 30

November 30

November 30

2010

2009

2010

2009

General and Administrative Expenses

Amortization of equipment

442

578

885

1,156

Bad debts

(18)

810

Exploration

16,438

17,819

Filing and regulatory fees

6,172

6,983

11,057

8,076

Foreign exchange loss

3,081

15,853

3,493

5,836

Consulting, management and directors’ fees (Note 11)

29,184

44,320

56,981

68,830

Geological consulting

50,166

57,199

Office and sundry

5,253

4,804

8,825

9,226

Office rent and utilities

3,609

5,149

6,964

8,779

Oil and gas production, royalties and other

2,662

6,829

3,902

7,008

Professional fees

9,598

16,744

15,479

21,509

Publicity, promotion and investor relations

30,188

76,867

61,176

101,079

Secretarial and employee benefits

3,893

13,596

14,164

26,086

Stock-based compensation

365

13,579

730

13,579

Telephone

1,621

3,140

5,099

4,975

Transfer agent fees

1,030

2,803

2,374

4,123

Travel, auto and entertainment

6,544

11,014

6,820

18,477

Operating Loss

(170,246)

(222,241)

(272,967)

(299,549)

Other Income (Expenses)

Miscellaneous income

11,785

1,672

18,445

2,689

Interest expense

(1,771)

(1,270)

(2,382)

Exploration expenditures written off

6,701

(3,191)

11,785

6,602

17,175

(2,884)

Net Loss for the Period

(158,461)

(215,639)

(255,792)

(302,433)

Unrealized gains on available-for-sale investments

(Note 5)

790

141

621

314

Comprehensive Loss for the Period

(157,671)

(215,498)

(255,171)

(302,119)

Loss per Share – Basic and Diluted

(0.002)

(0.004)

(0.004)

(0.005)

Weighted Average Number of Common Shares

Outstanding, Basic and Diluted

68,472,804

58,852,600

68,526,331

55,816,720

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

TERYL RESOURCES CORP.

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

(Stated in Canadian Dollars)

(Unaudited)

Three months

Three months

Six months

Six months

ended

ended

ended

ended

November 30

November 30

November 30

November 30

2010

2009

2010

2009

Cash flows from operating activities

Net loss for the period

(158,461)

(215,639)

(255,792)

(302,433)

Items not affecting cash

Amortization of equipment

442

578

885

1,156

Interest expense

1,270

Stock-based compensation

365

13,579

730

13,579

Changes in non-cash working capital items

Amounts receivable and prepaid expenses

6,133

6,123

2,209

(10,430)

Accounts payable and accrued liabilities

(8,736)

(110,251)

(52,981)

(226,357)

(160,257)

(305,610)

(303,679)

(524,485)

Cash flows from (used in) investing activities

Deferred exploration expenditures

(175,569)

(187,244)

(249,664)

Recovery of mineral property costs

42,154

33,218

(175,569)

42,154

(187,244)

(216,446)

Cash flows from financing activities

Bank indebtedness

15,462

Advances from (to) related parties

(6,023)

(29,288)

(35,014)

(62,404)

Proceeds from (repayment to) convertible loan

(60,000)

91,363

Share issuance costs

(23,186)

(62,153)

Subscription received (net)

219,999

Share capital issued for cash

250,256

104,750

821,537

229,438

197,782

245,197

788,343

(Decrease) increase in cash

(95,388)

(65,674)

(245,726)

47,412

Cash, beginning of period

109,812

119,271

260,150

6,185

Cash, end of period

14,424

53,597

14,424

53,597

Supplementary disclosure of cash flow information:

Interest paid

Income taxes paid

Non-cash items

Shares issued for property

7,500

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

TERYL RESOURCES CORP.

INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Stated in Canadian Dollars)

(Unaudited)

Share Capital

Equity

Component

Accumulated

Share

Other

Subscriptions Convertible Contributed Comprehensive

Amount

Received

Loan

Surplus

Loss

Deficit

Total

Number

Balance, May 31, 2009

49,587,528 12,030,233

115,875

344,878

(3,157)

(9,530,364)

2,957,465

Unrealized loss on

available-for-sale

investments

(30)

Shares issued for cash

upon:

Exercise of stock

options

12,500

1,250

Exercise of warrants

7,054,592

705,459

Fair value of options

exercised

792

(792)

Fair value of warrants

exercised

330,632

(330,632)

Subscription received

10,000

Private placements

10,808,826

967,105

(115,875)

851,230

Share issuance costs

(64,198)

Fair value of warrants

granted

(515,010)

515,010

Equity component of

convertible loan

14,565

Stock-based

compensation

22,477

Net loss for the year

(1,419,726)

Balance, May 31, 2010

67,463,446 13,456,263

10,000

14,565

550,941

(3,187) (10,950,090)

3,078,492

Shares issued for cash

upon:

Exercise of warrants

1,047,500

141,484

(10,000)

(36,737)

94,747

Shares issued for

property

50,000

7,500

Subscription received

229,999

Equity component of

convertible loan

(14,565)

14,565

Stock-based

compensation

730

Unrealized gain on

available-for-sale

investments

621

Net loss for the period

(255,427)

Balance, November 30,

2010

68,560,946 13,605,247

229,999

529,499

(2,566) (11,205,517)

3,156,297

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

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

1. NATURE OF OPERATIONS AND GOING CONCERN

Teryl Resources Corp. (the “Company”) is a public company incorporated under the British Columbia Company

Act on May 23, 1980 and changed to its current name on February 28, 1984. Its shares are listed on the TSX

Venture Exchange (“TSXV”). The Company makes expenditures on acquiring mineral properties and carries out

exploration work. It also acquires oil and gas property interests and participates in drilling wells.

These consolidated financial statements have been prepared on the basis of accounting principles applicable to a

going concern, which assumes that the Company will continue in operation for the foreseeable future and will be

able to realize its assets and discharge its liabilities in the normal course of operations. Several adverse conditions

cast substantial doubt on the validity of this assumption. The Company continues to incur operating losses, has

limited financial resources, limited sources of operating cash flow, and no assurances that sufficient funding,

including adequate financing, will be available to conduct further exploration and development of its mineral

property projects.

The Company’s ability to continue as a going concern is dependent upon its ability to obtain the financing

necessary to complete its mineral projects by issuance of share capital or through joint ventures, and to realize

future profitable production or proceeds from the disposition of its mineral interests. As at November 30, 2010

the Company had a working capital deficit of $25,864 (May 31, 2010 –$108,913) and had incurred accumulated

loss of $11,205,517 (May 31, 2010- $10,950,090). These consolidated financial statements do not include

adjustments that would be necessary should it be determined that the Company may be unable to continue as a

going concern.

If the going concern assumption was not appropriate for these financial statements, adjustments would be

necessary in the carrying values of assets, liabilities, reported income and expenses and the balance sheet

classifications used. Such adjustments could be material.

2. BASIS OF CONSOLIDATION AND PRESENTATION

These unaudited interim consolidated financial statements have been prepared in accordance with Canadian

generally accepted accounting principles and include the accounts of the Company and its wholly owned

subsidiaries, Argon Investment Corporation (inactive) and Teryl, Inc. Intercompany balances have been

eliminated upon consolidation. These unaudited interim consolidated financial statements follow the same

accounting policies and methods of their application as the most recent annual financial statements. These

unaudited interim consolidated financial statements should be read in conjunction with the audited financial

statements of the Company as at May 31, 2010.

Certain of the figures presented for comparative purposes have been reclassified to conform to the presentation

adopted in the current period.

3. FINANCIAL INSTRUMENTS

Financial instruments carrying value and fair value

The Company’s financial instruments consist of cash, receivables, investments, advances to and from related

parties, and accounts payable and accrued liabilities.

Cash is designated as “held-for-trading” and measured at fair value. Receivables and advances to related parties

are designated as “loans and receivables”. Investments are designated as “available-for-sale”. Advances from

related parties, and accounts payable and accrued liabilities are designated as “other financial liabilities”.

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

3. FINANCIAL INSTRUMENTS (Continued)

Financial instruments carrying value and fair value (Continued)

The carrying value of cash, receivables, advances to and from related parties and accounts payable and accrued

liabilities approximate their fair values due to their immediate or short-term maturity. Investments are recorded at

fair value based on quoted market prices at the balance sheet date.

Foreign exchange risk

The Company is primarily exposed to currency fluctuations relative to the Canadian dollar through expenditures

that are denominated in US dollars. Also, the Company is exposed to the impact of currency fluctuations on its

monetary assets and liabilities.

The operating results and the financial position of the Company are reported in Canadian dollars. Fluctuations in

exchange rates will, consequently, have an impact upon the reported operations of the Company and may affect

the value of the Company’s assets and liabilities.

The Company currently does not enter into financial instruments to manage foreign exchange risk.

The Company is exposed to foreign currency risk through the following financial assets and liabilities

denominated in currencies other than Canadian dollars:

Accounts

payable and

accrued

November 30, 2010

Cash

liabilities

US dollars

14,424 $

54,416

Accounts

payable and

accrued

May 31, 2010

Cash

liabilities

US dollars

13,065 $

51,879

At November 30, 2010, with other variables unchanged, a +/-10% change in exchange rates would

increase/decrease pre-tax loss by +/- $3,999.

Interest rate risk

The Company is not exposed to significant interest rate risk.

Market risk

The Company is exposed to market risk arising from its investments in and holdings of marketable equity

securities. Marketable securities are classified as available-for-sale. The Company intends to liquidate the

marketable securities when market conditions are conducive to a sale of these securities. At November 30, 2010,

with other variables unchanged, a +/- 10% change in equity prices would increase/decrease pre-tax loss by +/-

$146.

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

3. FINANCIAL INSTRUMENTS (Continued)

Credit risk

The Company is exposed to credit risk in the amount of its receivables.

Liquidity risk

The Company has no recent history of profitable operations and its present business is at an early stage. As such,

the Company is subject to many risks common to such enterprises, including under-capitalization, cash shortages

and limitations with respect to personnel, financial and other resources, and the lack of revenues. The Company

has no investments in asset backed commercial paper.

In order to finance the Company’s exploration programs and to cover administrative and overhead expenses, the

Company raises money through equity sales, from the exercise of convertible securities, and from the sale of

investments. There can be no such assurance that it will be able to obtain adequate financing in the future or that

the terms of any financing will be favourable. Many factors influence the Company’s ability to raise funds,

including the state of the resource market and commodities prices, the climate for mineral exploration, the

Company’s track record, and the experience and calibre of its management.

Fair Value Measurement

The Canadian Institute of Chartered Accountants (“CICA”) Handbook Section 3862 “Financial Instruments

Disclosures” requires disclosure of a three-level hierarchy for fair value measurements based upon the

significance of inputs used in making fair value measurements as follows:

Level 1 – quoted prices in active markets for identical assets or liabilities.

Level 2 – inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either

directly (i.e.: as prices) or indirectly (i.e.: derived from prices).

Level 3 – inputs for the asset or liability that are not based on observable market data.

At November 30, 2010, the levels in the fair value hierarchy into which the Company’s financial assets and

liabilities measured and recognized in the balance sheet at fair value are categorized are as follows:

Level 1

Level 2

Investments

1,458

4. INVESTMENTS

At November 30 and May 31, 2010, the Company owned 15,880 common shares of Linux Gold Corp., a

company with directors in common.

The Company classifies its investments as available-for-sale, with revaluation gains and losses recognized in

accumulated other comprehensive income (loss) and other-than-temporary losses recognized in net income (loss).

As at November 30, 2010, investments were measured at a fair value of $1,458 (May 31, 2010 - $837) and

resulted in an unrealized gain of $621 during the six months ended November 30, 2010 (2010 – $314).

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

5. EQUIPMENT

November 30

May 31

2010

Furniture and fixtures – at cost

27,010

27,010

Less: Accumulated amortization

(21,507)

(20,896)

5,503

6,114

Automotive equipment – at cost

15,531

15,531

Less: Accumulated amortization

(13,978)

(13,704)

1,553

1,827

7,056

7,941

6. OIL AND GAS WELL INTERESTS

The Company owns a 6.5% working interest (4.680% net revenue interest) in the Peters No. 1 Well, in Fayette

County, Texas, and a 7.5% working interest (5.79375% net revenue interest) in each of the C-S #1, Jancik #2 and

Herrmann #4 wells, located in Burleson County, Texas. The carrying cost of these wells has been completely

depleted.

The Company entered into agreements with IAS Energy, Inc., a company with common directors, to purchase

40% interests (subject to 40% net revenue interests to others) on May 18, 2006, in the Ken Lee #1 natural gas

well for $103,045 ($92,500 US), on June 8, 2006, in the Elvis Farris #2 natural gas well for $104,461 ($92,500

US) and on July 31, 2006, in the Clarence Bright #1 natural gas well for $104,673 ($92,500 US). All three wells

are located in Knox and Laurel Counties, Kentucky. The three wells commenced production late in 2006. During

the May 31, 2008 year end, the Company wrote off the carrying costs of the wells to $Nil, since the wells have no

proven economic reserves.

7. MINERAL PROPERTY INTERESTS

Balance

May 31,

November 30,

2010

Additions

2010

Property acquisition costs

Silverknife

Fish Creek

49,538

49,538

West Ridge

116,189

116,189

Gil Venture

31,127

31,127

Kahiltna Terrane

7,500

7,500

196,855

7,500

204,355

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

7. MINERAL PROPERTY INTERESTS (Continued)

Silverknife, Laird, BC, Canada

Pursuant to agreements between Reg Technologies Inc. (“Reg”), SMR Investments Ltd. (“SMR”), Rapitan

Resources Inc. (“Rapitan”), and Chevron Minerals Ltd. (“Chevron”), the Company acquired a 30% working

interest in the Silverknife mineral claims, situated in the Liard Mining Division in the Province of British

Columbia, subject to a 10% Net Profit Royalty to Rapitan and a 1% Net Smelter Returns to SMR. Subsequent to

November 30, 2010 the Company purchased the 10% NPI in the Silverknife property from Rapitan for

consideration of 200,000 common shares of the Company issued on January 25, 2011. (Note 15).

The Company has written down their acquisition costs to $1 and has written off their exploration and develop-

ment expenditures entirely, since the claims are not currently being explored and have no proven economic

reserves.

Fish Creek, Fairbanks, Alaska, USA

The Company and Linux Gold Corp. (“Linux”) entered into an agreement on March 5, 2002, whereby the

Company may earn up to a 50% interest in the Fish Creek mineral claims, located in the Fairbanks district of

Alaska, USA, by expending $500,000 US within three years and issuing 200,000 common shares (issued on

December 16, 2002 at $0.08 per share). An additional 100,000 shares were issued on February 14, 2007 at $0.16

per share in payment of an extension of the expenditure date to March 5, 2007, which was further extended to

March 5, 2011. Linux will have a 5% Net Royalty Interest until the Company pays $2,000,000 US. The Company

has written off their exploration and development expenditures of $111,947 entirely during the year ended May

31, 2010, since the claims are not currently being explored. The Company will continue to maintain the option

agreement and will only commence its exploration program once more financings are available.

Gold Hill, Cochise County, Arizona, USA

On June 10, 2006, the Company and Frederic & John Rothermel (the “Vendors”) entered into an agreement

whereby the Company purchased a 100% interest in the Gold Hill Patented Claim Group (7 claims) located in the

Warren Mining District, Cochise County, Arizona, USA, that are subject to a 10% Net Profit Royalty to the

Vendors, for the following considerations:

* $5,655 ($5,000 US) for a 90 day option and $11,268 ($10,000 US) to complete a due diligence within 90

days (paid),

* $38,244 ($36,000 US) paid during 2008 and 2007 to the Vendors, with $6,000 US to be made each

quarter (paid),

* complete a $50,000 US first phase exploration program conducted by the Vendors,

* $250,000 US per year upon commencement of production.

A further 28 claims were staked in the Company’s name for a cost of $5,538 ($5,214 US). The Company elected

to terminate its agreement with the Vendors on May 31, 2008 as to the original 7 patent claims and to abandon the

other 28 claims; accordingly, $60,705 in property costs and $213,184 in exploration costs were written off at May

31, 2008. Additional exploration expenditures of $13,570 were written off during the year ended May 31, 2009.

West Ridge, Dome Creek, Alaska, USA

Pursuant to various agreements, the Company earned a 100% interest in the West Ridge mineral properties

(approximately 5,200 acres) located in the Dome Creek area of the Fairbanks District of Alaska, USA. The

Company has written off their exploration and development expenditures of $661,615 entirely, since the claims

are not currently being explored. The Company will continue to maintain the claims and will only commence its

exploration program once more financings are available.

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

7. MINERAL PROPERTY INTERESTS (Continued)

Gil Venture, Dome Creek, Alaska, USA

Pursuant to various agreements, the Company acquired a 50% interest in 237 claims located in the Gilmore Dome

area of Fairbanks District of Alaska. On May 31, 1991, the Company, NERCO Exploration Company and Fort

Knox Venture entered into an agreement, which granted the Company a 20% participating interest in the claims.

Under the agreement, Fort Knox Venture paid the Company cash and funded approved programs, earning them

an 80% participating interest in the property, with the Company retaining a 20% participating interest. Fort Knox

Venture, through its operator Fairbanks Gold Mining, Inc., was doing exploration work on this property, until

May 31, 2011. An exploration program was completed in late 2008. During the six months ended November 30,

2010 the Company incurred exploration expenditure of $187,244 on the property.

Kahiltna Terrane Option, Alaska, USA

On September 1, 2010 the Company signed an option agreement (the “Option Agreement”) to acquire a 50%

interest in eleven mineral claims located in the Kahiltna Terrane area approximately 130 kilometers northwest of

Anchorage, Alaska. Consideration for the option is as follows:

* issue 50,000 common shares upon approval of the option agreement by the TSX.V (the “Approval Date”)

(issued on November 2, 1010);

* issue an additional 50,000 common shares on the first anniversary of the Approval Date;

* issue an additional 100,000 common shares and pay a US$10,000 cash payment on the second

anniversary of the Approval Date; and

* contribute $50,000 US for exploration expenditures in the first year and $100,000 US in exploration

expenditures in the second year.

On October 26, 2010 the Company staked and recorded an additional 23 mineral claims in the Kahiltna Terrane.

Pursuant to the Option Agreement the Company has a 100% interest in the additional new mineral claims,

subject to a 2½ % net royalty interest.

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

7. MINERAL PROPERTY INTERESTS (Continued)

Deferred Exploration Expenditures

November 30

May 31

2010

2010

Fish Creek Claims

Written off – inactive claims

(111,947)

Gil Venture Claims

Drilling

187,244

358,812

187,244

358,812

Gold Hill Claims

Travel, maps and rent

West Ridge Claims

Written off – inactive claims

(661,491)

Exploration expenditures for the year

358,812

Exploration expenditures invoiced or written off

Invoiced to joint venture partner

Written off – terminated, abandoned or inactive claims

(773,438)

(414,626)

Exploration expenditures – beginning of year

2,637,853

3,052,479

Exploration expenditures – end of year

2,825,751

2,637,853

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

8. ADVANCES TO/ FROM RELATED PARTIES

Amounts due to/ from related parties are unsecured, non-interest bearing and have no fixed terms of repayment.

Unless otherwise indicated, the following table represents companies controlled by the President and CEO of the

Company or companies where he is the President and CEO.

Advances to related parties:

November 30,

May 31,

2010

2010

IAS Energy, Inc.

24,822

24,821

Linux Gold, Inc.

90,773

72,672

REGI US, Inc.

28,600

144,195

126,093

Advances from related parties:

November 30,

May 31,

2010

2010

Information-Highway.com, Inc.

28,146

JGR Petroleum, Inc.

24,456

John Robertson

176

19,308

KLR Petroleum

23,534

Rainbow Networks Inc.

23,531

REGI US, Inc.

12,405

SMR Investments

8,400

8,576

131,380

9. CONVERTIBLE LOANS

On July 15, 2009, the Company entered into two promissory note agreements with an external party for $60,000

and $31,363 (US$27,000) to be paid on or before June 30, 2010. The two promissory notes have an interest rate

of 8% per annum to be paid monthly commencing on August 15, 2009. The principal amounts are convertible

into shares of the Company at $0.20 per share upon regulatory approval.

In January, 2010 the Company redeemed the convertible loan of $31,363 (US$27,000) with cash payment on the

full principal amount of US$27,000.

The fair value of the debt component of the convertible loan was estimated using discounted cash flow at 10% for

equivalent debt without the conversion feature. The fair value of equity component was estimated using Black-

Scholes option pricing model with following assumptions: risk-free interest rate of 1.45%, dividend of 0%,

expected life of 1 year and expected volatility of 210%. The debt and equity components of the convertible loans

were then measured using the proportional or relative fair value method and were initially recorded at $76,798

and $14,565 respectively. As at May 31, 2010, $13,295 interest has been amortized with its debt component

carried at amortized cost of $58,730 after the repayment of $31,363 (US$27,000). On June 1, 2010 the remaining

balance of $60,000 was repaid to the lender in full with the unamortized interest of $1,270 at May 31, 2010

recorded as interest expense upon repayment.

As at November 30, 2010, interest of $5,472 has been paid to the lender.

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

10. SHARE CAPITAL

Authorized share capital consists of:

100,000,000 voting common shares with no par value

5,000,000 non-voting preferred shares with $1 par value

The Preferred Shares have attached thereto a right to receive dividends as determined by the Directors. The

Preferred Shares may be issued in series, with special rights and restrictions therefore being determined by the

Directors, subject to regulatory approval. No Preferred Shares have been issued to the date of these financial

statements.

On June 8, 2009, the Company issued 2,120,000 units of capital stock pursuant to a Private Placement at a price

of $0.075 per unit. Each unit consists of one common share and one-half share purchase warrant exercisable

within one year for $0.10 per share. Finders’ fees in connection with this non-brokered private placement were

$3,675.

On August 18, 2009, the Company issued 7,042,092 units of capital stock pursuant to a Private Placement at a

price of $0.075 per unit. Each unit consists of one common share and one share purchase warrant exercisable

within one year for $0.10 per share and within two years for $0.15 per share. Finders’ fees in connection with

this non-brokered private placement were $34,478.

On November 17, 2009, an employee exercised stock options for 12,500 shares at a price of $0.10 per share.

On November 25, 2009, the Company issued 1,646,734 units of capital stock pursuant to a Private Placement at a

price of $0.17 per unit. Each unit consists of one common share and one share purchase warrant exercisable

within one year for $0.22 per share. Finders’ fees in connection with this non-brokered private placement were

$17,881. On October 21, 2010, the Company received TSX approval to an extension of the term of the 1,646,734

warrants due to expire on November 25, 2010, for an additional six months to May 25, 2011.

During January, 2010, the Company issued 7,042,092 common shares for warrants exercised at $0.10 per share.

On April 30, 2010 the Company issued 12,500 common shares for warrants exercised at $0.10 per share.

During the year ended May 31, 2010 the Company incurred filing fees of $8,164 in relation to the financings

completed during the year.

During the six months ended November 30, 2010 the Company issued 1,047,500 common shares for warrants

exercised at $0.10 per share.

During the six months ended November 30, 2010 the Company issued 50,000 common shares to the optioner of

the Kahiltna Terrane Option Agreement (Note 7). The shares are valued at $7,500 based on the trading price of

$0.15 on November 2, 2010, the issuance date of the shares.

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

10. SHARE CAPITAL (Continued)

Stock Options

The Company has a stock option plan to issue up to 10% of the issued common shares to certain directors and

employees. All options granted under the plan vest immediately upon grant, but are subject to the following

exercise conditions:

i) Up to 25% of the options may be exercised at any time during the term of the option; such initial exercise is

referred to as the “First Exercise”;

ii) The second 25% of the options may be exercised at any time after 90 days from the date of the First Exercise;

such second exercise is referred to as the “Second Exercise”;

iii) The third 25% of the options may be exercised at any time after 90 days from the date of the Second

Exercise; such third exercise is referred to as the “Third Exercise”; and

iv) The fourth and final 25% of the options may be exercised at any time after 90 days from the date of the Third

Exercise.

During the year ended May 31, 2010, the Company granted a total of 490,000 stock options with total fair value

of $21,685 for the options vested during the period.

During the six months ended November 30, 2010, the Company granted a total of 250,000 stock options

exercisable at $0.19 per share up to August 26, 2013 with total fair value of $730 for the options vested during the

period. Because the options were granted to a consultant performing investor relation activities, the options vest

in stages over 12 months with no more than ¼ of the options vesting in any three months period.

The fair value of options granted was estimated on the date of grant using the Black-Scholes option pricing

model, with the following weighted-average assumptions:

Six months ended

Year ended

November 30, 2010

May 31, 2010

Risk-free interest rate

1.52%

2.50%

Expected dividend yield

Nil

Nil

Expected stock price volatility

145%

137%

Expected life (in years)

4.44

On November 17, 2009, a total of 12,500 stock options with a fair value of $792 were exercised, resulting in

another 12,500 stock options exercisable on February 16, 2010 and recorded as stock based compensation of

$792.

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

10. SHARE CAPITAL (Continued)

Stock Options

The following is a summary of the Company’s stock option activities during the year ended May 31, 2010 and six

months ended November 30, 2010:

Weighted

Average

Number of

Exercise

Options

Price

Balance – May 31, 2009

1,825,000

0.150

Granted

325,000

0.185

Granted

65,000

0.250

Granted

100,000

0.240

Exercised

(12,500)

0.100

Balance – May 31, 2010

2,302,500

0.160

Granted

250,000

0.190

Balance – November 30, 2010

2,552,500

0.163

The following share purchase options were outstanding at November 30, 2010:

Remaining

Number of

Exercise

Number Contractual

Options

Expiry Date

Price

of Options

Life

Exercisable

(years)

December 4, 2010

0.250

65,000

0.01

16,250

November 2, 2011

0.180

25,000

0.92

6,250

April 24, 2012

0.150

1,650,000

1.40

412,500

November 7, 2012

0.220

25,000

1.94

6,250

March 10, 2013

0.210

75,000

2.28

18,750

August 31, 2013

0.190

250,000

2.74

2,055

April 23, 2014

0.100

37,500

3.40

12,500

October 30, 2014

0.185

275,000

3.92

68,750

November 5, 2014

0.185

50,000

3.94

12,500

April 19, 2015

0.240

100,000

4.39

25,000

2,552,500

580,805

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

10. SHARE CAPITAL (Continued)

Warrants

The following is a summary of the Company’s warrant activities during the years ended May 31, 2010 and six

months ended November 30, 2010:

Weighted

Average

Number of

Exercise

Warrants

Price

Balance – May 31, 2009

2,715,000

0.25

Issued

9,748,826

0.12

Exercised

(7,054,592)

0.10

Expired

(2,715,000)

0.25

Balance – May 31, 2010

2,694,234

0.17

Exercised

(1,047,500)

0.10

Expired

(1,646,734)

0.22

Extended

1,646,734

0.22

Balance – November 30, 2010

1,646,734

0.22

The following share purchase warrants were outstanding at November 30, 2010:

Remaining

Exercise

Number

Contractual

Expiry Date

Price of Warrants

Life (years)

May 25, 2011

0.22

1,646,734

0.49

1,646,734

During the year ended May 31, 2010, a total of 9,748,826 warrants were issued with a fair value of $515,010.

The fair value of warrants issued was estimated on the date of grant using the Black-Scholes option pricing

model, with the following weighted-average assumptions:

Risk-free interest rate

1.25%

Expected dividend yield

Nil

Expected stock price volatility

195.36%

Expected life (in years)

1.36

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

11. RELATED PARTY TRANSACTIONS

Related party transactions are in the normal course of operations and are measured at the exchange amount, which

is the amount of consideration established and agreed to by the related parties. Related party transactions not

disclosed elsewhere in these financial statements are as follows:

SMR Investments Ltd. (“SMR”) is a private company controlled by an officer of the Company. Under a

management contract with SMR, the Company agreed to pay up to $2,500 per month for management services.

The Company was charged management fees by SMR of $15,000 during the six months ended November 30,

2010 (2010 - $15,000). As at November 30, 2010, $8,400 (May 31, 2010 - $4,900) was payable to SMR by the

Company.

During the six months ended November 30, 2010, directors fees of $6,000 (2010 - $9,000) were paid to the

President of the Company. Administration consulting fees of $10,200 (2010 - $10,200) were paid to a director of

the Company. Secretarial and consulting fees of $9,000 (2010 - $9,000) were paid to a director of the Company.

During the six months ended November 30, 2010, fees of $2,826 (2010 - $5,129) were paid to KLR Petroleum

Ltd. (which is controlled by an officer of the Company) for administration of the Company payroll and benefit

plan.

During the six months ended November 30, 2010, office rent of $8,825 (2010 - $9,226) was paid to Linux Gold,

Inc.

12. TERYL, INC. TRASACTIONS (100% US Subsidiary)

In 1998, Teryl, Inc. offered a private placement for up to 1,000,000 shares at a price of $0.23 ($0.15 US) and

subscriptions of $146,044 ($96,750 US) were received by November 19, 1999. Since the offering was not fully

subscribed, the Companies negotiated with the subscribers to replace the Teryl, Inc. shares with Teryl Resources

Corp. shares. On October 17, 2006, the authorized capital for Teryl, Inc. was reduced to 10,000 common shares,

which resulted in a rollback to 1 common share for each 10,000 outstanding. On August 29, 2007, the final six

subscribers agreed to a settlement of $70,000 ($50,250 US).

13. SEGMENTED INFORMATION

The Company’s business consists of mineral properties and oil and gas property interests. Details on a

geographic basis are as follows:

United

Canada

States

Total

Six Months Ended November 30, 2010

Total assets

208,763

3,025,988

3,234,751

Acquisition and exploration costs

3,029,451

3,029,452

Net income (loss)

(272,264)

16,472

(255,792)

TERYL RESOURCES CORP.

NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010

(Stated in Canadian Dollars)

(Unaudited)

13. SEGMENTED INFORMATION (Continued)

United

Canada

States

Total

Year ended May 31, 2010

Total assets

432,746

2,837,359

3,270,105

Acquisition and exploration costs

2,834,707

2,834,708

Net loss

752,797

666,929

1,419,726

14. CAPITAL MANAGEMENT

The capital of the Company consists of the items included in shareholders’ equity. The Company manages the

capital structure and makes adjustments in light of changes in economic conditions and the risk characteristics of

the Company’s assets.

The Company’s objectives of capital management are intended to safeguard the entity’s ability to continue the

Company’s development and exploration of its mineral properties and support any expansionary plans.

To effectively manage the entity’s capital requirements, the Company has in place a planning and budgeting

process to help determine the funds required to ensure the Company has the appropriate liquidity to meet its

development and exploration objectives.

15. SUBSEQUENT EVENTS

On December 4, 2010, 65,000 stock options exercisable into the Company’s common stocks at $0.25 per share

expired.

On December 21, 2010 the Company purchased an additional 10% NPI in the Silverknife property for

consideration of 200,000 common shares of the Company (issued on January 25, 2011), resulting in the

Company’s total ownership of 30% working interest and a 10% net profit interest of the property.

During January, 2011, the Company issued 3,342,659 units of capital stock pursuant to a Private Placement at a

price of $0.15 per unit. Each unit consists of one common share and one share purchase warrant exercisable

within one year of issuance for $0.20 per share. Finders’ fees in connection with this non-brokered private

placement were $18,687 and issued 39,000 broker warrants exercisable into the Company’s common shares at

$0.20 per share until January 19, 2012.