The following is a discussion of the operating results and financial position of Silverado Gold Mines Ltd. ("Silverado" or the "Company") for the nine months ended August 31, 2009. It should be read in conjunction with the Company's audited consolidated financial statements and footnotes for the fiscal year ended November 30, 2008 and the interim unaudited consolidated financial statements for the nine-month period ended August 31, 2009.

All financial information in this Management's Discussion and Analysis ("MD&A") is expressed and prepared in conformity with US generally accepted accounting principles. All references are in US dollar, the Company's reporting currency, unless otherwise noted. Some numbers in this MD&A have been rounded to the nearest thousand for discussion purposes.

Certain forward-looking statements are discussed in this MD&A with respect to the Company's activities and future financial results, which are made based upon management's current expectations and beliefs. There can be no assurance that future developments affecting the Company will be those anticipated by management.

The information in this Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve risks and uncertainties, including statements regarding Silverado's capital needs, business plans and expectations. Such forward-looking statements involve risks and uncertainties regarding the market price of gold, availability of funds, government regulations, common share prices, operating costs, capital costs, outcomes of gold recovery activities and other factors. Forward-looking statements are made, without limitation, in relation to operating plans, property exploration and gold recovery activities, availability of funds, environmental reclamation, operating costs and permit acquisition. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may", "seek", "should", "expect", "plan", "intend", "anticipate", "believe", "estimate", "predict", "potential" or "target", the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined below, and, from time to time, in other reports Silverado files with the Securities Exchange Commission (the "SEC"). These factors may cause actual results to differ materially from any forward-looking statement. Management disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

OVERVIEW

The Company is engaged in the acquisition and exploration of mineral properties in the State of Alaska, through its wholly-owned subsidiary, Silverado Gold Mines Inc., and is involved with the development of a new environmentally friendly low-rank coal-water fuel ("LRCWF") technology through its other wholly-owned subsidiary, Silverado Green Fuel, Inc.

The Company has committed over three decades of work to the exploration, development and test mining of gold properties throughout North America. In the mid-1980s, the Company decided to focus its efforts in Alaska. We have extensive experience in geological, geochemical and geophysical exploration techniques. Our mineral holdings are located in the Fairbanks Mining District and in the Koyukuk Mining District, consisting of both lode and placer mining claims. At the present time, the Company's primary focus is the exploration and development of our Nolan Gold and Antimony Project and our Hammond Gold Property located 175 miles north of Fairbanks, Alaska. We are also continuing with exploration activities on our Eagle Creek Gold and Antimony Property and our Ester Dome Gold Project, which are both located in the Fairbanks Mining District.

MINERAL EXPLORATION

The Company is a mineral exploration company with interests in properties located throughout the state of Alaska. The majority of such properties are in the early stages of exploration, and there is no assurance that a commercially viable mineral deposit exists on such properties.

The Company holds interests in the following four groups of mineral properties in Alaska:

1) Nolan property;

2) Hammond Property;

3) Eagle Creek Property; and

4) Ester Dome Property.

Based on the completion of a preliminary feasibility study by an independent and AIPG Certified Professional Geologist (the "QP"), our Nolan Gold and Antimony Lode Project has disclosed an economically viable mineral reserve. The preliminary feasibility study, entitled "Update of Mineral Resource and Reserve Estimates and Preliminary Feasibility Study, Workman's Bench Antimony-Gold Lode Deposit, Nolan Creek, Wiseman B-1 Quadrangle, Koyukuk Mining District, Northern Alaska, January 1, 2009" (the "Technical Report"), concluded that the resource estimates disclosed by the Company in its Current Report on Form 8-K filed with the SEC on November 17, 2008 can be reclassified as a probable reserve. Though there were no material changes to the grades and quantities previously reported on November 17, 2008, there was additional data produced that added new grades and there was further work conducted on this zone that resulted in the aforementioned reclassification.

In response to comments received from the British Columbia Securities Commission (BCSC) in May 2009, the Company amended the Technical Report to reflect additional data. A copy of the amended Technical Report, dated June 1, 2009, was filed on June 3, 2009 on SEDAR and EDGAR, and can also be found at the Company's website at www.silverado.com. The measured reserve estimates on Workman's Bench, on which the pre-feasibility study was based, have not changed. Certain material changes are shown below:

Overall mineral exploration performance during the nine-month period ended August 31, 2009 and management's plan of operations for each property are discussed below.

1. NOLAN GOLD AND ANTIMONY PROPERTY

The Company owns a 100 percent interest in numerous mining claims on the Nolan Creek Project. As of August 31, 2009, the Company's Nolan Gold Project consist of 204 unpatented, federal placer mining claims covering approximately 4,080 acres in three non-contiguous groups, and 407 unpatented federal lode mining claims covering approximately 8,140 acres in one large contiguous group. Many of the 407 lode mining claims are superimposed over the placer mining claims.

The majority of the properties comprising our Nolan Gold Project are adjacent to or within the Nolan Creek Valley, located approximately 8 miles northwest of the small town of Wiseman, and 175 air miles north of Fairbanks, Alaska in the southern foothills of the Brooks Range. Centrally located in the historic Koyukuk Mining District, Nolan Creek is a southerly flowing tributary to Wiseman Creek which flows southeasterly into the Middle Fork of the Koyukuk River. An all weather road connects the Nolan Creek Camp with the Dalton Highway and is suitable year-round for semi-tractors loaded with fuel and equipment. Air transportation is available by several commercial carriers from Fairbanks to the 4,500 ft long, state maintained Coldfoot Airport. The community of Coldfoot Alaska is about 15 miles south-southeast of Nolan, and has Alaska's northernmost gas station, grocery, and public lodging.

All of the Nolan Gold Project properties are on federal land and located within the Wiseman B-1 Quadrangle. All of the mineral claims, with the exception noted below, are in the SE ¼, Township 31 North, Range 12 West, the NE ¼, Township 30 North, Range 12 West, and SW ¼, Township 31 North, Range 11 West, Fairbanks Meridian.

In addition to the Nolan Creek properties, Silverado also has two smaller placer claim groups on Clara Creek and Marion Creek, located 1.5 and 3 miles north respectively of the town of Coldfoot, Alaska, situated near the Dalton Highway.

Under Silverado's ownership since 1982, a total of 23,153 ounces of placer gold was recovered from channel and bench deposits in the Nolan Valley through 2006. The largest nugget recovered to date weighed 41.35 ounces and was valued at US$16,000 by weight. It sold for US$50,000. Most nuggets recovered at Nolan Valley are suitable for jewelry.

Placer deposits at Nolan Creek can be found in frozen gravel beds (ancient channel deposits) some of which can be mined year round. Test mining can be carried out by underground methods during the coldest winter months, and by surface methods most of the year. In the summer months when the gravel has thawed, snow melt water is available for gold recovery by hydraulic sluicing. The sluicing process uses only gravity and water within a closed circuit, ensuring that there is zero discharge to the environment. Lands disturbed by mining are fully reclaimed. The Company operates under 11 combined federal and state permits.

The measured reserve estimates on Workman's Bench, on which the pre-feasibility study was based, have not changed in the amended June 1, 2009 Technical Report. The QP chose to modify inferred Sb and Au resources estimates on the Pringle Bench upon further review of the distance between drill control points used in a polygonal analysis of the inferred resources on Pringle bench. The June 1, 2009 amended inferred resource estimates for the Pringle Bench and Nolan areas are shown below:

General Note Regarding Estimates

The following information should be considered in connection with our estimates below, which we are disclosing in accordance with applicable SEC standards and regulations:

º Assumed Prices of US $700/oz for gold and US $2.25/lb for antimony.
º Process Recovery Rates of 85% for antimony and 90% for gold (as provided by Hazen Research from work done on an underground bulk sample from the D tunnel of the Workman's Bench A vein and using gravity and water recovery systems only).
º Estimated Operating Costs of US $375/ton, based on operation of a 92 ton per day underground mine.

A cutoff grade of 4% antimony was used in our analysis. A 4% cutoff grade should be regarded as 4% antimony equivalent. No cutoff grade was used for gold, as antimony was the primary commodity being examined, and none of the resource polygons contained less than 0.05 oz/ton gold.

Cautionary Note to Investors concerning estimates of Probable Reserve

Readers are cautioned that the following estimates are under the category of a probable reserve and they are not a proven reserve, which requires a higher degree of feasibility study. These values are based off of a preliminary feasibility sturdy, which is not the same as a legal feasibility study.

Reserve Cut-Off Grade Quantity Grade Metal Grade Metal Category (% Sb) (tons) (% Sb) (ton Sb) (oz/ton Au) (oz Au) Probable 4.0 42,412 28.00 11,880 0.408 17,300

Notes:

- The effective date of these resources is January 1, 2009
- Rounding may result in some discrepancies.
- No processing recovery factors have been applied to these resource figures.
- The unit ton refers to short tons.
- Cut-off grade is 4.0% Sb 'equivalent', which the combined values of gold plus antimony expressed in terms of antimony alone.
- Assay results for the 2009 drilling program received thus far have been disclosed in three press releases on September 3rd, 4th and 22nd. The grades and resource estimates above do not reflect these new assays. Additional assay results of drill core are pending and the antimony and gold resources will significantly change to reflect the new assay results. The new resource estimates will be determined by the QP. The additional assay results and any new resource estimates will be disclosed on the Company website (www.silverado.com)

The following table uses the term 'inferred resources'. Silverado advises U.S. investors that while this term is recognized and required by Canadian regulations (under National Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize this term. U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.

     Silverado's Amended, Inferred Lode Mineral Resources, Nolan Creek Area

Resource Cut-off grade Quantity Grade    Metal       Grade     Metal
Category    (% Sb)      (ton)   (% Sb)  (ton Sb)  (oz/ton Au) (oz Au)
Inferred      4.0       24,077  12.45     2,997.6    0.245    5,894.7



Notes:

-      The effective date of these resources is January 1, 2009; amended June 1,
       2009.

Summary of Amended Inferred Antimony and Gold resources from 'A' and 'West'

                              Zones, Pringle Bench

      Category       Cut-Off Grade Quantity Grade   Metal      Grade     Metal
                        (% Sb)      (tons)  (% Sb) (ton Sb) (oz/ton Au) (oz Au)
 'A' Vein Inferred        4.0        737    29.13   214.7      0.113     83.4
'West' Vein Inferred      4.0       1,951    9.86   192.3      0.049     94.7
       TOTALS             4.0       2,688   15.14   407.0      0.067     178.1

Notes:

- The effective date of these resources is January 1, 2009; amended June 1, 2009
- Rounding may result in some discrepancies.
- No processing recovery factors have been applied to these resource figures.
- The unit ton refers to short tons.
- Cut-off grade is 4.0% Sb 'equivalent', which is the combined values of gold plus antimony expressed in terms of antimony
- Assay results for the 2009 drilling program received thus far have been disclosed in three press releases on September 3rd, 4th and 22nd. The grades and resource estimates above do not reflect these new assays. Additional assay results of drill core are pending and the antimony and gold resources will significantly change to reflect the new assay results. The new resource estimates will be determined by the QP. The additional assay results and any new resource estimates will be disclosed on the Company website (www.silverado.com)

The plan of operation for the Nolan Gold Project for the 2009 fiscal year is the continued advancement toward the development and mining stage of our Nolan Gold and Antimony Project, especially along the southwestern end of the Solomon Shear Zone in the Workman's Bench Area. The Workman's Bench area already has a portal and 570 feet of underground tunnels that will be used to access the subsurface during the extraction of a permitted 1,000 cubic yard bulk sample of gold and antimony ore.

During the third quarter of the fiscal year ended August 31, 2009, the Company continued implementing the recommendations of the preliminary feasibility study for the Workman's Bench gold and antimony deposit and the Pringle Bench gold and antimony deposit. The Company drilled 20 diamond drill holes at Nolan, totaling 4,992 ft. Nine holes, totaling 2,663 ft, were drilled into the Solomon Shear Zone along Workman's Bench. Eleven holes, totaling 2,329 ft, were drilled into the Solomon Shear Zone along Pringle Bench. Drill data combined with both ground and airborne geophysical data and soil geochemical data indicate that Workman's Bench and Pringle Bench are part of the same structural zone.

All diamond core drilling was performed by Tri-Con Mining Inc. The core recovery averaged 90-95% in most drill holes. All drill core was logged and photographed by contract geologists. Once all technical data was derived from the core, the core was cut lengthwise. The half-core was sampled by pre-determined intervals based on geology, and placed in sealed sample bags and labeled with the assigned sample number. All samples were delivered to ALS Chemex in Fairbanks for analysis. Individual sample shipments (batches) did not exceed 20 samples, and each batch that was submitted to the lab contained two (2) standard samples and one (1) blank sample for analysis. From time to time the Company instructed the laboratory to assay duplicate samples of the pulp from the drill core.

The first phase of the 2009 diamond drill season focused on Workman's Bench, specifically on the southern extension of the Solomon Shear Zone's primary resource target known as the 'A' Zone antimony-quartz-carbonate-gold fault vein. The 'A' Zone encompassed a probable reserve based on 2007 and 2008 drill data, yet there remained over 250 vertical feet of potential near surface antimony and gold mineralization, above the current probable reserve, that had not been drilled into. The 'A' zone remains open to the south but a topographic survey during the early arctic summer indicated a drill target of over 250 vertical feet, above the disclosed probable reserve, that was not drilled into due to lack of heavy equipment access during 2007 and 2008. During 2009, eight of the nine holes drilled at Workman's Bench intercepted the 'A' Zone above the previously disclosed probable reserve.

The second phase of the 2009 drill program took place along Pringle Bench and focused on intercepting the 'A' Zone at depths below the 2007 drilled intercepts as well as along strike to the southwest and to the northeast of previous drilling and trenching geochemical data. During 2009, ten of eleven holes intercepted the 'A' Zone at Pringle Bench. The Company is waiting on drill core assay results of the other potential zones at Pringle Bench referred to as the 'West' and 'B' and 'C' zones.

Eighteen of the 20 holes intercepted the 'A' zone during the 2009 drill program. Two of the holes were abandoned due to drilling difficulties and therefore did not intercept any significant mineralization. Drill core assay results of the 2009 drill program have been disclosed in Company news releases on the 3rd, 4th, and 22nd of September, 2009, but more assay results are pending. The drill core assay results could increase the previous resource estimates for both the Workman's Bench and Pringle Bench properties.

Based on the new 2009 drill data, Company and contract geologists along with the Company QP have confirmed that the gold and antimony mineralized zones correlate with the surface geochemistry and geophysical data that extends northeast past Pringle Bench along the strike through an area referred to as the Hillside Lode Prospect. The Company has stated previously that the Hillside Area was thought to be the source of the placer gold mined from the gravel benches located along the left limit of Nolan Creek between Smith and Archibald Creeks. The Hillside Lode Prospect is located uphill of the gold-rich gravel benches mined by Silverado as recent as 2006.

In addition to the 2009 drill program, the Company has been aggressively seeking permits and also compiling various studies by numerous contractors to meet application requirements for ongoing permits. In order for the project to advance to the development stage at Nolan, the permitting process involves various characterization studies. Some of these studies are seasonally dependent and some require time periods that can delay the permitting process. The baseline water quality sampling which began in June of 2008 and was halted due to freezing temperatures during October of 2008 was continued in early June of 2009. The last baseline water sample for 2009 will be collected in late September or early October.

The access road into the Nolan Creek camp as well as the 26 man camp facility received construction upgrades in preparation for the 1,000 cubic yard bulk ore sample that the Company has been permitted to sample. Essential to the bulk sample program and future development is the environmental baseline and characterization studies that include Acid Rock Drainage studies also known as acid-base accounting, as well as the water quality baseline sampling. Samples of the ore and wall rock gangue from various core intercepts and also wall rock from the 'A' zone were submitted by the QP to analytical labs for determination of acid generating potential. The Company's QP has directed a third party engineering firm to conduct various geotechnical studies of the wall rock and ore rock.

The Company, as per the QP, began seeking a calcareous rock unit that is accessible for extraction on the Nolan property. Permits for the extraction of the calcareous rock will not be applied for until the Company has verified that such a rock unit is accessible. The extraction of a calcareous rock could be used as a buffering liner for temporary storage of waste rock that may have acid generating potential.

During the next three months, Silverado will continue to implement the recommendations of the preliminary feasibility study that was completed by the Company QP Thomas K. Bundtzen. The QP will determine additional resource estimates and these estimates will be disclosed to the public as soon as they are completed by the QP. The QP will also oversee geotechnical studies as well as the acid rock characterization study. The Company will continue upgrades to the infrastructure at Nolan. The company plans to construct additional access trails for drilling into the Hillside Zone and will perform additional surveying for planning and design purposes. The Company will continue with aggressive permitting and will seek additional capital needed for the procurement of a pilot mill and equipment that will be used during the extraction and processing of the permitted 1,000 cubic yard bulk sample of gold and antimony ore.

In addition to the advice of the QP, Silverado will implement the advice and strategy of Mr. Peter Hooper who is a member of the Company's new Advisory Board. A brief resume of Mr. Hooper is listed in the August 24, 2009 news release on Silverado's website (www.Silverado.com). Mr. Hooper offers the scale of experience that the Company needs to move through the development stage and into the mining stage. The Company's Advisory Board was created to increase the Company's expertise in financing, mining and operations.