EX-99.1 2 exhibit99-1.htm EXHIBIT 99.1

B2Gold Corp. - Exhibit 99.1 - Filed by newsfilecorp.com

B2GOLD CORP.
Condensed Interim Consolidated Financial Statements
For the three and nine months ended September 30, 2014
(Unaudited)

B2GOLD CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30

(Expressed in thousands of United States dollars, except shares and per share amounts)

(Unaudited)

		For the three			For the three			For the nine			For the nine
		months ended			months ended			months ended			months ended
		Sept. 30, 2014			Sept. 30, 2013			Sept. 30, 2014			Sept. 30, 2013
Gold revenue	$	114,924		$	128,730		$	364,202		$	406,218
Cost of sales
Production costs		(66,311	)		(61,782	)		(194,545	)		(195,555	)
Depreciation and depletion		(29,020	)		(21,190	)		(82,710	)		(54,327	)
Royalties and production taxes		(3,671	)		(4,520	)		(11,957	)		(12,559	)
Inventory fair value adjustments on CGA acquisition		-			-			-			(32,869	)
Total cost of sales		(99,002	)		(87,492	)		(289,212	)		(295,310	)
Gross profit		15,922			41,238			74,990			110,908
General and administrative		(7,604	)		(6,656	)		(28,020	)		(23,945	)
Share-based payments (Note 12)		(2,712	)		(4,656	)		(13,440	)		(13,641	)
Foreign exchange losses		(1,784	)		(223	)		(450	)		(1,656	)
Write-off of mineral property interests		(364	)		(9,564	)		(364	)		(9,564	)
CGA acquisition costs		-			-			-			(5,859	)
Gain on sale of Brucejack royalty		-			-			-			44,496
Other		(2,468	)		(782	)		(2,455	)		(3,088	)
Impairment of goodwill and other long-lived assets (Note 5)		(298,397	)		-			(298,397	)		-
Operating (loss) income		(297,407	)		19,357			(268,136	)		97,651
Gain (loss) on fair value of convertible notes (Note 11)		31,522			8,633			(11,173	)		8,633
Community relations		(3,034	)		(1,431	)		(5,796	)		(4,728	)
Interest and financing expense		(1,675	)		(1,813	)		(4,418	)		(3,943	)
Realized losses on derivative instruments		(389	)		(2,046	)		(1,273	)		(3,241	)
Unrealized gains (losses) on derivative instruments		995			784			1,942			(5,665	)
Write-down of long-term investments (Note 8)		-			-			(3,007	)		(18,481	)
Convertible notes transaction costs		-			(9,026	)		-			(9,026	)
Other		352			(37	)		1,432			(281	)
(Loss) income before taxes		(269,636	)		14,421			(290,429	)		60,919
Current income tax, withholding and other taxes		(3,562	)		(6,742	)		(18,946	)		(16,358	)
Deferred income tax (expense) recovery		(930	)		270			(260	)		(3,478	)
Net (loss) income for the period	$	(274,128	)	$	7,949		$	(309,635	)	$	41,083
Attributable to:
Shareholders of the Company	$	(274,096	)	$	7,949		$	(309,648	)	$	41,083
Non-controlling interests		(32	)		-			13			-
Net (loss) income for the period	$	(274,128	)	$	7,949		$	(309,635	)	$	41,083
(Loss) earnings per share (attributable to shareholders of the Company)
Basic	$	(0.39	)	$	0.01		$	(0.45	)	$	0.07
Diluted	$	(0.39	)	$	0.00		$	(0.45	)	$	0.05
Weighted average number of common shares outstanding (in thousands) (Notes 6 and 12)
Basic		700,755			647,787			682,516			631,128
Diluted		700,755			679,159			682,516			644,398

See accompanying notes to condensed interim consolidated financial statements.

B2GOLD CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30

(Expressed in thousands of United States dollars)

(Unaudited)

		For the three			For the three			For the nine			For the nine
		months ended			months ended			months ended			months ended
		Sept. 30, 2014			Sept. 30, 2013			Sept. 30, 2014			Sept. 30, 2013
Net (loss) income for the period	$	(274,128	)	$	7,949		$	(309,635	)	$	41,083
Other comprehensive (loss) income
Items that may be reclassified subsequently to net earnings:
- Exchange differences on translating foreign                    operations		(24,055	)		(3,193	)		(24,914	)		(25,207	)
- Unrealized gain (loss) on investments, net of                    deferred tax expense (Note 8)		449			1,824			3,026			(1,314	)
Reclassification adjustment for impairment loss on              investment to net earnings (Note 8)		-			-			-			4,545
Other comprehensive loss for the period		(23,606	)		(1,369	)		(21,888	)		(21,976	)
Total comprehensive (loss) income for the period	$	(297,734	)	$	6,580		$	(331,523	)	$	19,107
Total other comprehensive loss attributable to:
Shareholders of the Company	$	(21,200	)	$	(1,369	)	$	(19,396	)	$	(21,976	)
Non-controlling interests		(2,406	)		-			(2,492	)		-
	$	(23,606	)	$	(1,369	)	$	(21,888	)	$	(21,976	)
Total comprehensive (loss) income attributable to:
Shareholders of the Company	$	(295,296	)	$	6,580		$	(329,044	)	$	19,107
Non-controlling interests		(2,438	)		-			(2,479	)		-
	$	(297,734	)	$	6,580		$	(331,523	)	$	19,107

See accompanying notes to condensed interim consolidated financial statements.

B2GOLD CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30

(Expressed in thousands of United States dollars)

(Unaudited)

		For the three			For the three			For the nine			For the nine
		months ended			months ended			months ended			months ended
		Sept. 30, 2014			Sept. 30, 2013			Sept. 30, 2014			Sept. 30, 2013
Operating activities
Net (loss) income for the period	$	(274,128	)	$	7,949		$	(309,635	)	$	41,083
Mine restoration provisions settled		(345	)		(210	)		(954	)		(804	)
Non-cash charges (Note 15)		301,456			25,366			410,750			74,238
Cash provided by operating activities before changes in            non-cash working capital		26,983			33,105			100,161			114,517
Changes in non-cash working capital (Note 15)		9,269			3,503			(13,054	)		835
Changes in long-term value added tax receivables		(3,069	)		(1,154	)		(11,971	)		(5,877	)
Cash provided by operating activities		33,183			35,454			75,136			109,475
Financing activities
Revolving credit facilities, net drawdowns and transaction            costs (Note 11)		48,767			(269	)		73,767			45,952
Convertible notes, net of transaction costs		-			249,724			-			249,724
Otjikoto equipment loan facility, drawdowns net of            transaction costs (Note 11)		(22	)		-			19,689			-
Repayment of Otjikoto equipment loan facility		(1,522	)		-			(3,927	)		-
Payment of finance lease obligations (Note 11)		-			(2,082	)		(16,017	)		(5,946	)
Repayment of Libertad equipment loan		(274	)		(152	)		(651	)		(302	)
Masbate project loan repayments		-			-			-			(18,524	)
Common shares issued for cash		967			415			2,763			2,369
Restricted cash movement (Note 10)		44			-			(3,025	)		9,000
Interest and commitment fees paid		(5,223	)		(859	)		(12,460	)		(2,159	)
Common shares issued by subsidiary to EVI for cash		-			5,095			-			5,095
Cash provided by financing activities		42,737			251,872			60,139			285,209
Investing activities
Expenditures on mining interests:
Otjikoto, mine construction		(29,755	)		(17,900	)		(118,787	)		(60,775	)
Otjikoto, mobile mine equipment		(623	)		(18,330	)		(7,596	)		(41,223	)
Otjikoto, power plant		(191	)		(15,545	)		(3,243	)		(15,545	)
Otjikoto, prestripping		(4,600	)		(4,072	)		(9,239	)		(4,072	)
Otjikoto, expansion		(1,114	)		-			(1,114	)		-
Gramalote, prefeasibility and exploration		(2,907	)		(11,536	)		(11,043	)		(44,081	)
Masbate Mine, development and sustaining capital		(6,564	)		(10,033	)		(32,499	)		(20,846	)
Libertad Mine, development and sustaining capital		(4,106	)		(2,344	)		(20,043	)		(14,449	)
Libertad Mine, Jabali development		(1,496	)		(3,176	)		(3,878	)		(11,303	)
Limon Mine, development and sustaining capital		(3,134	)		(4,543	)		(13,320	)		(12,529	)
Other exploration and development (Note 15)		(8,337	)		(6,508	)		(24,790	)		(22,315	)
Cash received for EVI preference shares		-			-			5,487			-
Purchase of EVI preference shares		-			-			-			(6,458	)
Loan to EVI		-			(5,000	)		-			(5,000	)
Cash acquired on Papillon acquisition		32,189			-			32,189			-
Cash acquired on CGA acquisition		-			-						56,088
CGA acquisition costs paid		-			-			-			(16,012	)
Cash proceeds from sale of Brucejack royalty		-			-			-			44,496
Purchase of long-term investments		(958	)		-			(1,694	)		(3,997	)
Other		(92	)		(248	)		605			(865	)
Cash used by investing activities		(31,688	)		(99,235	)		(208,965	)		(178,886	)
Increase (decrease) in cash and cash equivalents		44,232			188,091			(73,690	)		215,798
Cash and cash equivalents, beginning of period		134,814			95,656			252,736			67,949
Cash and cash equivalents, end of period	$	179,046		$	283,747		$	179,046		$	283,747

See accompanying notes to condensed interim consolidated financial statements.

B2GOLD CORP.

CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of United States dollars)

(Unaudited)

		As at			As at
		Sept. 30,			Dec. 31,
		2014			2013
Assets
Current
Cash and cash equivalents	$	179,046		$	252,736
Accounts receivable and prepaids		14,926			26,273
Value-added and other tax receivables		20,965			19,823
Inventories (Note 7)		82,931			75,665
		297,868			374,497
Long-term investments (Note 8)		25,380			20,769
Value-added tax receivables		36,237			28,875
Mining interests (Note 9 and Note 20 - Schedules)
- Owned by subsidiaries		2,155,278			1,517,277
- Investments in joint ventures (Note 5)		64,942			150,168
Goodwill (Note 5)		-			202,070
Other assets (Note 10)		19,620			16,070
	$	2,599,325		$	2,309,726
Liabilities
Current
Accounts payable and accrued liabilities	$	58,081		$	65,812
Current taxes payable		13,279			15,658
Current portion of long-term debt (Note 11)		8,277			12,965
Current portion of unrealized fair value of derivative instruments		798			2,563
Current portion of mine restoration provisions		1,332			1,351
Other		481			472
		82,248			98,821
Unrealized fair value of derivative instruments		-			205
Long-term debt (Note 11)		390,119			300,447
Mine restoration provisions		45,409			45,449
Deferred income taxes		187,957			186,811
Employee benefits obligation		5,542			6,626
		711,275			638,359
Equity
Shareholders’ equity
Share capital (Notes 6 and 12)
Issued: 680,221,227 common shares (Dec 31, 2013 – 674,719,721)		1,534,093			1,519,217
Papillon consideration (Note 6)		484,277			-
Contributed surplus		56,406			52,333
Accumulated other comprehensive loss		(59,935	)		(40,539	)
Retained earnings (deficit)		(177,008	)		132,640
		1,837,833			1,663,651
Non-controlling interests		50,217			7,716
		1,888,050			1,671,367
	$	2,599,325		$	2,309,726
Subsequent events (Notes 6 and 12)

Approved by the Board “Clive T. Johnson” Director “Robert J. Gayton” Director

See accompanying notes to condensed interim consolidated financial statements.

B2GOLD CORP.

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30

(Expressed in thousands of United States dollars)

(Unaudited)

					2014
		Shares (‘000’s)			Share capital			Contributed surplus			Accumulated other comprehensive loss			Retained earnings			Non- controlling interests			Total equity
Balance at December 31, 2013		674,720		$	1,519,217		$	52,333		$	(40,539	)	$	132,640		$	7,716		$	1,671,367
Jan. 1, 2014 to Sept. 30, 2014:
Net loss for the period		-			-			-			-			(309,648	)		13			(309,635	)
Shares to be issued for Papillon            acquisition (Note 6)		-			484,277			-			-			-			-			484,277
Non-controlling interest            acquired (Note 6)		-			-			-			-			-			45,348			45,348
Cumulative translation adjustment		-			-			-			(22,422	)		-			(2,860	)		(25,282	)
Unrealized gain on investments		-			-			-			3,026			-			-			3,026
Shares issued on exercise of stock            options		2,886			2,763			-			-			-			-			2,763
Shares issued on vesting of RSU		2,615			8,114			(8,114	)		-			-			-			-
Shares issued from incentive plan		-			15			-			-			-			-			15
Share based payments		-			-			16,171			-			-			-			16,171
Transfer to share capital on            exercise of stock options and            incentive plan		-			3,984			(3,984	)		-			-			-			-
Balance at Sept. 30, 2014		680,221		$	2,018,370		$	56,406		$	(59,935	)	$	(177,008	)	$	50,217		$	1,888,050

					2013
		Shares (‘000’s)			Share capital			Contributed surplus			Accumulated other comprehensive loss			Retained earnings			Non- controlling interests			Total equity
Balance at December 31, 2012		393,308		$	468,550		$	35,383		$	(6,793	)	$	62,807		$	6,372		$	566,319
Jan. 1, 2013 to Sept. 30, 2013:
Net income for the period		-			-			-			-			41,083			-			41,083
Shares issued for CGA Mining            acquisition		251,973			984,870			-			-			-			-			984,870
Exercise of EVI option for 2%		-			-			-			-			2,530			2,565			5,095
Cumulative translation adjustment		-			-			-			(25,207	)		-			(986	)		(26,193	)
Reclassify unrealized loss on            investment from AOCL to            income statement		-			-			-			4,545			-			-			4,545
Unrealized loss on investments		-			-			-			(1,314	)		-			-			(1,314	)
Shares issued on exercise of            stock options		1,600			2,369			-			-			-			-			2,369
Shares issued on vesting of RSU		1,987			6,289			(6,289	)		-			-			-			-
Shares issued to EVI		2,513			7,600			-			-			-			-			7,600
Share based payments		-			-			17,408			-			-			-			17,408
Tax benefit related to share            issue costs		-			1,972			-			-			-			-			1,972
Transfer to share capital on            exercise of stock options		-			1,121			(1,121	)		-			-			-			-
Balance at Sept. 30, 2013		651,381		$	1,472,771		$	45,381		$	(28,769	)	$	106,420		$	7,951		$	1,603,754

See accompanying notes to condensed interim consolidated financial statements.

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

1	Nature of operations
	B2Gold Corp. (“B2Gold” or the “Company”) is a Vancouver-based gold producer with three operating mines (two in Nicaragua and one in the Philippines), a fourth mine under construction in Namibia and a portfolio of development and exploration assets in Mali, Colombia, Burkina Faso and Nicaragua.
	The Company operates the Libertad Mine and the Limon Mine in Nicaragua and the Masbate Mine in the Philippines. The Company has a 90% interest in the Otjikoto gold project in Namibia, an effective 81% interest in the Kiaka gold project in Burkina Faso, a 49% joint venture interest in the Gramalote property in Colombia, and an interest in the Quebradona property in Colombia. The Company owns the Trebol and Pavon properties in Nicaragua and the Bellavista property in Costa Rica. The Company also has a 51% interest in a joint operation in Nicaragua with Calibre Mining Corp. (“Calibre”), with an option to acquire an additional 19% interest, and a 60% interest in two joint operations in Nicaragua with Radius Gold Inc. (“Radius”).
	On September 22, 2014, B2Gold obtained control of Papillon Resources Limited (“Papillon”), including its 90% interest in the Fekola Project (Note 6).
	B2Gold is a public company which is listed on the Toronto Stock Exchange under the symbol “BTO”, the NYSE MKT LLC under the symbol “BTG” and the Namibian Stock Exchange under the symbol “B2G”. B2Gold’s head office is located at Suite 3100, Three Bentall Centre, 595 Burrard Street, Vancouver, British Columbia, V7X 1J1.
2	Basis of preparation
	These condensed interim consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting. These condensed interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2013, which have been prepared in accordance with IFRS as issued by the IASB.
	These condensed interim consolidated financial statements follow the same accounting policies and methods of application as the most recent audited consolidated financial statements of the Company, with the exception to the changes in accounting policies as described in Note 3 below.
	These condensed consolidated interim financial statements were authorized for issue by the Board of Directors on November 13, 2014.
3	Recent accounting pronouncements
	IFRIC 21 – Levies
	The Company adopted IFRIC 21 on January 1, 2014, with retrospective application. IFRIC 21 provides guidance on the accounting for a liability to pay a levy, both for levies that are accounted for in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets and those where the timing and amount of the levy is certain. Levies are imposed by a government in accordance with legislation and do not include income taxes, fines or other penalties imposed for breaches of legislation. IFRIC 21 defines an obligating event as the legislatively identified activity that triggers the payment of the levy. Recognition of a liability to pay a levy is at the date of the obligating event. The fact that the Company is economically compelled to continue to operate in the future does not create an obligation to pay a levy that will arise in a future period as a result of continuing to operate.
	The Company has concluded that the adoption of IFRIC 21 did not have an effect on the condensed interim consolidated financial statements for the current period or prior periods presented.
	IFRS 15 – Revenue from contracts with customers
	The IASB has issued IFRS 15, Revenue from Contracts with Customers, which is effective for annual periods commencing on or after January 1, 2017. This new standard establishes a new control-based revenue recognition model which could change the timing of revenue recognition. The Company is currently evaluating the effect the standard will have on its consolidated financial statements.

1

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

4	Significant accounting judgements and estimates
	a)	Impairment of long-lived assets
		Long-lived assets are tested for impairment if there is an indicator of impairment. Calculating the estimated fair values of cash generating units (“CGU”) for long-lived asset impairment tests requires management to make estimates and assumptions with respect to future production levels, mill recoveries, operating and capital costs in its life-of-mine plans, future metal prices, foreign exchange rates, and discount rates. Changes in any of the assumptions or estimates used in determining the fair values could impact the impairment analysis. Such changes could be material.
	b)	Ore reserve and resource estimates
		Ore reserves are estimates of the amount of ore that can be economically and legally extracted from the Company’s mining properties. The Company estimates its ore reserves and mineral resources based on information compiled by appropriately qualified persons relating to the geological data on the size, depth and shape of the ore body, and requires complex geological judgments to interpret the data. The estimation of recoverable reserves is based upon factors such as estimates of foreign exchange rates, commodity prices, future capital requirements, metallurgical recoveries, and production costs along with geological assumptions and judgments made in estimating the size, and grade of the ore body. Changes in the reserve or resource estimates may impact the carrying value of mining interests, mine restoration provisions, recognition of deferred tax assets, and depreciation and amortization charges.
	c)	Uncertain tax positions
		The Company is periodically subject to income tax audits at its operating mine locations. During the nine months ended September 30, 2014, the Company recorded provisions totalling $2.7 million representing its best estimate of the outcome of current assessments. The Company is appealing the assessments received and the final outcome of such appeals are not determinable at this time. The provisions made to date may be subject to change and such change may be material.
	d)	Value-added tax receivables
		The Company incurs indirect taxes, including value-added tax, on purchases of goods and services at its operating mines and development projects. Indirect tax balances are recorded at their estimated recoverable amounts within current or long-term assets, net of provisions, and reflect the Company’s best estimate of their recoverability under existing tax rules in the respective jurisdictions in which they arise. Management’s assessment of recoverability involves judgments regarding balance sheet classification and the probable outcomes of claimed deductions and/or disputes. The provisions and balance sheet classifications made to date may be subject to change and such change may be material.

2

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

5	Impairment of goodwill and long-lived assets
	During the three months ended September 30, 2014, the long-term consensus gold price continued to be below the overall long-term gold price assumptions used in the Company’s reserve estimations and life-of-mine plans. The prolonged decline of the long-term gold price was considered to be an impairment indicator at September 30, 2014. The Company has revised its long-term gold price estimate to $1,300 per ounce of gold.
	In accordance with its accounting policy, the Company will update its impairment indicator assessment for its long- lived assets at December 31, 2014 in light of any continuing volatility in the long-term gold price or changes in any other factors that may indicate that its long-lived assets are impaired. Updated life-of-mine plans will be prepared for each of the Company’s mining operations to incorporate 2014 year-end reserve and resource estimates. In addition, the Company is currently finalizing a metallurgical recovery sampling and analysis program in order to assess the potential for a mill expansion at the Masbate Mine and to assist in mine planning. The conclusions of the report are expected by the end of 2014, and will be incorporated in Masbate’s mineral reserves and resources and related mine plan.
	The Company performed impairment tests on the following cash-generating units: Masbate Mine, including related goodwill, Limon Mine, Libertad Mine and Otjikoto Mine. The Company’s investment in the Gramalote joint venture was also assessed for impairment. As a result of these assessments, the Company determined that impairment charges were required for the goodwill relating to the Masbate Mine and the Company’s investment in Gramalote as described below.
	Masbate goodwill
	The Company conducted a goodwill impairment analysis whereby the carrying values of the Masbate property, plant and equipment and goodwill, were compared to the mine’s fair value using the fair value less costs of disposal (“FVLCD”) methodology. In carrying out the review of Masbate’s long-lived assets for impairment, the Company utilized discounted cash flow models incorporating estimates and assumptions that included such factors as future production levels, metallurgical recovery estimates, operating and capital costs in its life-of-mine plans, future metal prices, foreign exchange rates and discount rates. The Company’s estimate of future cash flows is subject to risks and uncertainties and therefore could change in the future if the underlying assumptions change.
	Key assumptions used for the impairment test at September 30, 2014 were:

	-        Gold price	$1,300/ounce
	-        Silver price	$20/ounce
	-        Discount rate	5% - 7%

The Company’s analysis concluded that the carrying values of Masbate Mine property, plant and equipment and amounts assigned to undeveloped mineral interests at September 30, 2014 were not impaired. However, it was concluded that the carrying value of Masbate related goodwill was impaired, resulting in an impairment charge of $202.1 million being recorded in the statement of operations for the current quarter.

Investment in Joint Venture - Gramalote

The Company conducted an impairment analysis whereby the carrying value of the investment in the Gramalote joint venture was compared to the investment’s fair value using the fair value less costs of disposal (“FVLCD”) methodology. In carrying out the impairment analysis, the Company utilized discounted cash flow models incorporating estimates and assumptions that include such factors as future production levels, mill recoveries, operating and capital costs in its life-of-mine plans, future metal prices, foreign exchange rates and discount rates. These factors were based on the assumptions and inputs disclosed by the Company on March 13, 2014 from the Gramalote Preliminary Economic Assessment and included a long-term gold price assumption of $1,300 per ounce of gold and a discount rate of 6.5% . The Company’s estimate of future cash flows is subject to risks and uncertainties and therefore could change in the future if the underlying assumptions change.

The Company’s analysis concluded that the investment in Gramalote was impaired resulting in an impairment charge of $96.3 million being recorded in the statement of operations for the current quarter.

3

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

6	Acquisition of Papillon Resources Limited
	On October 3, 2014, the Company completed the scheme of arrangement (“Merger”) by which the Company acquired all of the issued ordinary shares of Papillon. Under the terms of the Merger, the Company acquired all of the issued and outstanding ordinary shares of Papillon based on an exchange ratio of 0.661 of a common share of B2Gold for each Papillon ordinary share. In addition, all of the outstanding stock options of Papillon were cancelled and the former holders thereof received that number of the Company shares that corresponded to the value of the “in-the-money” portion of their Papillon options. The primary asset acquired was the Fekola Project located in Mali.
	The arrangement has been accounted for as a purchase of net assets. For accounting purposes, the acquisition date was determined to be September 22, 2014, the date at which the Company obtained control of Papillon.
	The cost of the acquisition was approximately $493.3 million, and included the fair value of the shares issued of $484.3 million, based on the issuance of 237,390,819 shares at Cdn.$2.25 per share and a foreign exchange rate of Cdn.$1.1031 to $1, plus transaction costs of approximately $9.0 million.
	The purchase price was calculated as follows:

			$
	Common shares issued (237,390,819 common shares)		484,277
	Transaction costs		9,026
	Total purchase price		493,303

The following table sets forth the allocation of the purchase price to the fair value of the assets and liabilities acquired.

			$
	Purchase price allocation:
	Cash and cash equivalents		32,189
	Accounts receivable and prepaids		1,241
	Mining interests – Fekola		507,627
	Mining interests – Mali other		6,067
	Accounts payable and accrued liabilities		(8,473	)
	Non-controlling interest		(45,348	)
			493,303

7 Inventories

			Sept. 30,			Dec. 31,
			2014			2013
			$			$
	Gold and silver bullion		15,133			23,050
	In-process inventory		9,125			8,471
	Ore stock-pile inventory		14,441			3,427
	Materials and supplies		44,232			40,717
			82,931			75,665

4

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

8 Long-term investments

			Sept. 30, 2014												Dec. 31, 2013
			Cost			Impair- ment			AOCI			Fair Value			Cost			Impair- ment			AOCI			Fair Value
			$			$			$			$			$			$			$			$
	Available-for-sale investments:
	St. Augustine Gold & Copper Ltd.		20,193			(11,337	)		184			9,040			20,193			(8,452	)		-			11,741
	RTG Mining Inc.		13,400			(4,011	)		2,711			12,100			8,803			(4,011	)		-			4,792
	Sierra Mining Limited		-			-			-			-			5,893			(3,867	)		1,344			3,370
	Calibre Mining Corp.		5,716			(4,345	)		2,379			3,750			5,068			(4,222	)		-			846
	Kronk Resources Inc.		496			-			(15	)		481			-			-			-			-
	Goldstone Resources Ltd.		20			-			(11	)		9			20			-			-			20
	Balance, end of period		39,825			(19,693	)		5,248			25,380			39,977			(20,552	)		1,344			20,769

On June 4, 2014, RTG Mining Inc. (“RTG”) acquired all of the outstanding securities of Sierra Mining Limited (“Sierra”). The Company received three new ordinary shares of RTG for every ten shares held of Sierra. The transaction did not constitute a disposal; therefore, unrealized gains were not transferred from Accumulated Other Comprehensive Income (“AOCI”) to the statement of operations.

5

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

9 Mining interests

			Sept. 30, 2014			Dec. 31, 2013
			$			$
	Property, plant and equipment (depletable)
	Masbate Mine, Philippines (Note 5)
	Cost		757,630			723,155
	Accumulated depreciation and depletion		(75,328	)		(40,744	)
			682,302			682,411
	Libertad Mine (including Jabali), Nicaragua
	Cost		289,567			259,518
	Accumulated depreciation and depletion		(117,218	)		(83,927	)
			172,349			175,591
	Limon Mine, Nicaragua
	Cost		136,983			120,139
	Accumulated depreciation and depletion		(56,979	)		(44,970	)
			80,004			75,169
	Masbate undeveloped mineral interests (Note 5)		176,460			176,460
	Mine under construction
	Otjikoto, Namibia		402,568			289,945
	Exploration and evaluation properties (non-depletable)
	Fekola, Mali (Note 6)		507,618			-
	Kiaka, Burkina Faso		56,478			50,550
	Mocoa, Colombia		28,606			28,200
	Trebol & Pavon, Nicaragua		26,738			24,870
	San Jose, Nicaragua		1,218			1,123
	Calibre, Nicaragua		9,435			8,496
	Other		8,046			861
			638,139			114,100
	Corporate & other
	Bellavista, Costa Rica		2,611			2,611
	Office, furniture and equipment, net		845			990
			3,456			3,601
			2,155,278			1,517,277
	Investments in joint ventures (accounted for using the equity method)
	Gramalote, Colombia (Note 5)		63,741			148,967
	Quebradona, Colombia		1,201			1,201
			64,942			150,168
			2,220,220			1,667,445

6

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

	Otjikoto
	During the three and nine months ended September 30, 2014, the Company capitalized interest costs on its borrowings attributable to funds spent on Otjikoto (subsequent to the issuance of the related loans) in the amount of $3.7 million and $9.4 million, respectively. This interest was calculated on an effective interest basis on the Company’s aggregate borrowings which includes the convertible senior subordinated notes and the revolving corporate credit facility (Note 11).
10	Other assets

			Sept. 30,			Dec. 31,
			2014			2013
			$			$
	EVI loan receivable, including accrued interest		12,335			11,898
	Debt service reserve account (Note 11)		3,628			1,149
	Reclamation deposits		1,561			1,495
	Fair value of derivative instruments		35			-
	Other		2,061			1,528
			19,620			16,070

11 Long-term debt

			Sept. 30,			Dec. 31,
			2014			2013
			$			$
	Convertible senior subordinated notes:
	- Principal amount		258,750			258,750
	- Fair value adjustment		(11,463	)		(21,196	)
			247,287			237,554
	Revolving corporate credit facility:
	- Principal amount		125,000			50,000
	- Less: unamortized transaction costs		(3,716	)		(3,399	)
			121,284			46,601
	Equipment loans/finance lease obligations:
	- Masbate finance lease obligations		-			17,273
	- Otjikoto equipment loan facility (net of unamortized transaction costs)		25,149			9,168
	- Libertad equipment loan		4,676			2,816
			29,825			29,257
			398,396			313,412
	Less: current portion		(8,277	)		(12,965	)
			390,119			300,447

7

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

Convertible senior subordinated notes

As at September 30, 2014, the fair value of the convertible senior subordinated notes was $247.3 million, resulting in a change in fair value for the three and nine months of a gain of $31.5 million and a loss of $11.2 million, respectively. For the three months ended September 30, 2014, the gain in fair value of the notes recognized in the statement of operations was reduced to $31.5 million by $3.0 million of capitalized finance costs which are attributable to eligible expenditures on the Otjikoto property. For the nine months ended September 30, 2014, the change in fair value of the notes recognized in the statement of operations was reduced to $11.2 million by $7.9 million of capitalized finance costs.

Interest payments in the first and third quarter of 2014 were $5.1 million and $4.2 million, respectively.

Revolving corporate credit facility

During the first quarter of 2014, the Company entered into an amending agreement pursuant to which the facility amount of the Senior Credit Facility was increased by $50 million to a total amount of $200 million, subject to updating security documents to reflect the increased amount of the facility.

During the three and nine months ended September 30, 2014, the Company drew down an additional $50 million and $75 million, respectively, under the Senior Credit Facility. As at September 30, 2014 the Company had drawn down a total of $125 million under the Senior Credit Facility, leaving an undrawn balance of $75 million.

For the three and nine months ended September 30, 2014, the interest and financing expense relating to the revolving corporate credit facility recognized in the statement of operations was reduced by $0.7 million and $1.5 million, respectively, which was attributable to eligible expenditures on the Otjikoto property and capitalized to the carrying amount of the property.

Masbate finance lease obligations

During the first quarter of 2014, the Company notified Leighton Holdings Limited (“Leighton”) that it was exercising its option to terminate the mining services agreement effective December 31, 2014 and would purchase the leased assets under the agreement. On June 30, 2014, the Company terminated the finance lease and took ownership of the leased assets.

Otjikoto equipment loan facility

During the nine months ended September 30, 2014, a subsidiary of the Company, B2Gold Namibia drew $20.3 million under the facility. At September 30, 2014, the B2Gold Namibia had drawn $30.5 million under the facility leaving $10.4 million undrawn, based on current exchange rates. Transaction costs relating to the facility totalled approximately $1.6 million and are being recognized over the term of the facility using the effective interest rate method.

The Borrower is required to maintain a deposit in a debt service reserve account ("DSRA") with HSBC Bank Bermuda Limited equal at all times to the total of the principal, interest and other payments that become payable over the next six month period. At September 30, 2014, the balance in the DSRA was $3.6 million (Note 10).

Libertad equipment loan

During the first quarter of 2014, a subsidiary of the Company purchased mobile heavy equipment valued at $3.0 million (2013 - $4.2 million) for its Libertad operation. The Company paid 15% of the value of the equipment in cash and entered into two credit contracts with Caterpillar Crédito S.A de C.V for the remaining 85%. The contracts have a sixty month term, with quarterly payments of principal and interest at a variable rate of LIBOR plus 4.0% . The Company has provided security on the loan in the form of the related equipment.

8

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

12	Capital stock
	The Company’s authorized share capital consists of an unlimited number of common shares and an unlimited number of preferred shares. As at September 30, 2014, the Company had 680,221,227 common shares outstanding, including 2,705,000 common shares being held in trust under the Company’s Incentive Plan. No preferred shares were outstanding.
	On September 22, 2014, the Company acquired control of Papillon and recognized an equity reserve for the fair value of the shares to be issued to Papillon Sharholders as consideration for the acquisition (Note 6). On October 3, 2014, the Company completed the acquisition through acquiring all of the issued ordinary shares of Papillon by issuing 237,390,819 B2Gold common shares.
	During the nine months ended September 30, 2014, the Company granted 5.7 million stock options to employees and directors. These options have a weighted average exercise price of C$2.91, have a term of five years and vest over a period of up to three years. The fair value was calculated using the Black-Scholes option pricing model based on a risk-free annual interest rate of 1.14%, an expected life of 2.8 years, an expected volatility of 59%, and a dividend yield rate of nil. The total number of stock options outstanding at September 30, 2014 was 41.5 million.
	For the three and nine months ended September 30, 2014, share-based payments expense, relating to the vesting of stock options, was $1.5 million and $5.7 million, respectively (2013 - $2.8 million and $6.9 million), net of $0.8 million and $2.5 million, respectively (2013 - $1.1 million and $2.7 million) capitalized to mining interests.
	During the nine months ended September 30, 2014, the Company granted 2.2 million RSUs to employees and directors. The total number of RSUs outstanding at September 30, 2014 was 2.6 million.
	For the three and nine months ended September 30, 2014, share-based payments expense, relating to the vesting of RSUs, was $1.2 million and $5.6 million, respectively (2013 - $1.8 million and $6.7 million), net of $0.0 million and $0.2 million, respectively (2013 - $0.2 million and $1.1 million) capitalized to mining interests.
	On April 30, 2014, 0.75 million common shares were awarded from the trust under the Incentive Plan to a senior employee of the Company. In connection with the award, the Company recorded a share-based payments expense of $2.1 million (the market value of the shares on the date of the award) in the nine months ended September 30, 2014.
13	Gold commitments
	At September 30, 2014, the following gold forward contracts with respect to the Otjikoto Project were outstanding (by maturity dates):

			2015			2016			2017			2018			Total
	Gold forward contracts:
	- Ounces		35,496			52,986			55,716			48,216			192,414
	- Average price per ounce (rand)		14,874			15,500			15,587			15,727			15,458

These contracts are excluded from the scope of IAS 39, accounted for as executory contracts as they were entered into and continue to be held for the purpose of delivery in accordance with the Company’s expected production schedule. No fair value gains and losses on these commodity contracts have been recorded in the financial statement. The effect of these contracts will be to provide a fixed price in rand for a portion of gold sales.

9

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

14	Financial instruments
	The Company’s financial assets and liabilities consist of cash and cash equivalents, accounts receivable, loan receivable from EVI (Note 10), long-term investments (Note 8), accounts payable and accrued liabilities, South African rand foreign exchange derivative contracts, gold derivative contracts, and debt (Note 11).
	Fair values
	The Company’s financial assets and liabilities are classified based on the lowest level of input significant to the fair value measurement based on the fair value hierarchy:

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); and

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

As at September 30, 2014, the Company’s financial assets and liabilities that are measured and recognized at fair value on a recurring basis are categorized as follows:

			As at Sept. 30, 2014						As at Dec. 31, 2013
			Level 1			Level 2			Level 1			Level 2
			$			$			$			$
	Long-term investments (Note 8)		25,380			-			20,769			-
	Convertible senior subordinated notes (Note 11)		-			(247,287	)		-			(237,554	)
	Gold derivative contracts (Note 10)		-			35			-			(205	)
	South African rand foreign exchange derivative contracts		-			(798	)		-			(2,563	)

The fair value of the Company’s long-term investments was determined using market quotes from an active market for each investment.

The fair value of the convertible senior subordinated notes was determined using a broker’s price quote from an active market.

The fair value of the gold derivative contracts and South African rand foreign exchange derivative contracts was determined using prevailing market rates for instruments with similar characteristics.

The Company has entered into foreign currency contracts to manage its foreign currency exposure of forecast expenditures denominated in Namibian dollars relating to the development of its Otjikoto project. As the Namibian dollar is pegged to the South African rand, the Company enters into foreign currency contracts between the South African rand and the United States dollar due to their greater liquidity.

10

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

15	Supplementary cash flow information
	Supplementary disclosure of cash flow information is provided in the table below:

a) Non-cash (credits) charges:

			For the three			For the three			For the nine			For the nine
			months ended			months ended			months ended			months ended
			Sept. 30, 2014			Sept. 30, 2013			Sept. 30, 2014			Sept. 30, 2013
			$			$			$			$
	Depreciation and depletion		29,020			21,190			82,710			54,327
	Impairment of goodwill and long-lived assets (Note 5)		298,397			-			298,397			-
	(Gain) loss on fair value of convertible notes (Note 11)		(31,522	)		(8,633	)		11,173			(8,633	)
	Share-based payments (Note 12)		2,712			4,656			13,440			13,641
	Write-down of long-term investments (Note 8)		-			-			3,007			18,481
	Deferred income tax expense (recovery)		930			(270	)		260			3,478
	Unrealized(gain) loss on derivative instruments		(995	)		(784	)		(1,942	)		5,665
	Write-down of mineral property interests		364			9,564			364			9,564
	Gain on sale of Brucejack royalty		-			-			-			(44,496	)
	Inventory fair value adjustments on CGA acquisition		-			-			-			32,869
	Amortization of deferred revenue		-			(9,368	)		-			(28,150	)
	Convertible notes transaction costs		-			9,026			-			9,026
	Other		2,550			(15	)		3,341			8,466
			301,456			25,366			410,750			74,238

b) Changes in non-cash working capital:

			For the three			For the three			For the nine			For the nine
			months ended			months ended			months ended			months ended
			Sept. 30, 2014			Sept. 30, 2013			Sept. 30, 2014			Sept. 30, 2013
			$			$			$			$
	Accounts receivable and prepaids		3,732			17,669			6,461			(5,609	)
	Value-added and other tax receivables		12,878			(1,303	)		(504	)		874
	Inventories		(3,015	)		4,570			(9,166	)		18,745
	Accounts payable and accrued liabilities		(4,230	)		(12,389	)		(7,466	)		(1,230	)
	Income and other taxes payables		(96	)		(5,044	)		(2,379	)		(11,945	)
			9,269			3,503			(13,054	)		835

11

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

c) Other exploration and development:

			For the three			For the three			For the nine			For the nine
			months ended			months ended			months ended			months ended
			Sept. 30, 2014			Sept. 30, 2013			Sept. 30, 2014			Sept. 30, 2013
			$			$			$			$
	Kiaka Project, exploration		(2,127	)		-			(5,684	)		-
	Masbate Mine, exploration		(719	)		(1,651	)		(3,154	)		(6,105	)
	Libertad Mine, exploration		(1,197	)		(1,369	)		(3,471	)		(4,089	)
	Limon Mine, exploration		(1,291	)		(1,055	)		(3,431	)		(3,462	)
	Otjikoto, exploration/feasibility		(1,594	)		(1,424	)		(4,354	)		(5,392	)
	Primavera, exploration		(397	)		(202	)		(905	)		(976	)
	Mocoa, exploration		(95	)		(66	)		(389	)		(519	)
	Trebol and Pavon, exploration		(565	)		(150	)		(2,300	)		(352	)
	Other		(352	)		(591	)		(1,102	)		(1,420	)
			(8,337	)		(6,508	)		(24,790	)		(22,315	)

d) Non-cash investing and financing activities:

			For the three			For the three			For the nine			For the nine
			months ended			months ended			months ended			months ended
			Sept. 30, 2014			Sept. 30, 2013			Sept. 30, 2014			Sept. 30, 2013
			$			$			$			$
	Common shares to be issued for Papillon acquisition		484,277			-			484,277			-
	Common shares issued for CGA acquisition		-			-			-			984,870
	Common shares issued to EVI on assignment of its right to acquire an additional 5% interest in the Otjikoto property		-			-			-			1,000
	Share-based compensation, capitalized to resource property interests		805			1,294			2,731			3,767
	Equipment purchased under finance lease		-			-			2,115			-
	Equipment purchased under equipment loan		-			-			2,512			3,271
	Interest expense, capitalized to mining interests		3,695			320			9,404			1,051
	Change in accounts payable and accrued liabilities relating to resource property expenditures		1,050			2,991			(17,712	)		10,800

16	Compensation of key management
	Key management includes the Company’s directors, members of the Executive Committee and members of Senior Management. Compensation to key management included:

		For the three	For the three	For the nine	For the nine
		months ended	months ended	months ended	months ended
		Sept. 30,2014	Sept. 30, 2013	Sept. 30, 2014	Sept. 30, 2013
		$	$	$	$
	Salaries and short-term employee benefits	1,297	1,198	7,198	5,910
	Share-based payments	1,211	1,212	7,708	4,873

12

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

17	Segmented information
	The Company’s reportable operating segments include its mining operations and development projects, namely the Limon, Libertad and Masbate mines, and the Otjikoto, Fekola, Gramalote and Kiaka projects. The “Other Mineral Properties” segment consists of the Company’s interests in mineral properties which are at various stages of exploration. The “Corporate and Other” segment includes corporate operations and the Bellavista property in Costa Rica which is presently undergoing environmental and closure audits.
	The Company’s segments are summarized in the following tables.

			For the three months ended September 30, 2014
			Limon Mine			Libertad Mine			Masbate Mine			Otjikoto Project			Gramalote Project			Kiaka Project			Fekola Project			Other Mineral Properties			Corporate & Other			Total
			$			$			$			$			$			$			$			$			$			$
	Gold revenue		12,311			46,196			56,417			-			-			-			-			-			-			114,924
	Production costs		10,579			19,865			35,867			-			-			-			-			-			-			66,311
	Depreciation & depletion		4,094			12,064			12,862			-			-			-			-			-			63			29,083
	Impairment of goodwill and other long-lived assets		-			-			202,070			-			96,327			-			-			-			-			298,397
	Net (loss) income		(2,171	)		4,212			(202,998	)		(1,060	)		(96,327	)		(486	)		-			(417	)		25,119			(274,128	)
	Capital expenditures		4,424			6,799			7,284			37,877			2,907			2,127			-			1,412			7			62,837
	Total assets		106,770			230,531			983,110			433,192			63,741			56,679			507,618			75,708			141,976			2,599,325

			For the three months ended September 30, 2013
			Limon Mine			Libertad Mine			Masbate Mine			Otjikoto Project			Gramalote Project			Kiaka Project			Fekola Project			Other Mineral Properties			Corporate & Other			Total
			$			$			$			$			$			$			$			$			$			$
	Gold revenue		17,789			51,434			59,507			-			-			-			-			-			-			128,730
																					-
	Production costs		8,902			20,562			32,318			-			-			-			-			-			-			61,782
	Depreciation & depletion		4,678			7,971			8,540			-			-			-			-			-			69			21,258
	Net (loss) income		1,734			13,375			12,334			-			-			-			-			(9,704	)		(9,790	)		7,949
	Capital expenditures		5,598			6,889			11,235			57,271			11,536			-			-			1,605			118			94,252
	Total assets		111,921			242,119			1,215,685			256,959			145,021			-			-			64,282			238,694			2,274,681

13

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

			For the nine months ended September 30, 2014
																								Other
			Limon			Libertad			Masbate			Otjikoto			Gramalote			Kiaka			Fekola			Mineral			Corporate
			Mine			Mine			Mine			Project			Project			Project			Project			Properties			& Other			Total
			$			$			$			$			$			$			$			$			$			$
	Gold revenue		50,062			148,795			165,345			-			-			-			-			-			-			364,202
	Production costs		30,571			63,713			100,261			-			-			-			-			-			-			194,545
	Depreciation & depletion		13,039			33,417			36,254			-			-			-			-			-			189			82,899
	Impairment of goodwill and other long-lived assets		-			-			202,070			-			96,327			-			-			-			-			298,397
	Net income (loss)		3,323			21,363			(191,926	)		(1,189	)		(96,327	)		(994	)		-			(259	)		(43,626	)		(309,635	)
	Capital expenditures		16,751			27,392			35,653			144,333			11,043			5,684			-			4,699			41			245,596
	Total assets		106,770			230,531			983,110			433,192			63,741			56,679			507,618			75,708			141,976			2,599,325

			For the nine months ended Sept. 30, 2013
																								Other
			Limon			Libertad			Masbate			Otjikoto			Gramalote			Kiaka			Fekola			Mineral			Corporate
			Mine			Mine			Mine			Project			Project			Project			Project			Properties			& Other			Total
			$			$			$			$			$			$			$			$			$			$
	Gold revenue		62,677			134,430			209,111			-			-			-			-			-			-			406,218
	Production costs		29,019			56,752			109,784			-			-			-			-			-			-			195,555
	Cost of sales – inventory fair value adjustments on CGA acquisition		-			-			32,869			-			-			-			-			-			-			32,869
	Depreciation & depletion		12,439			19,643			22,244			-			-			-			-			-			157			54,483
	Net income (loss)		9,878			33,007			14,172			-			-			-			-			(9,977	)		(5,997	)		41,083
	Capital expenditures		15,991			29,841			25,565			127,007			44,081			-			-			5,033			397			247,915
	Total assets		111,921			242,119			1,215,685			256,959			145,021			-			-			64,282			238,694			2,274,681

14

B2GOLD CORP.

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended September 30, 2014

(All tabular amounts are in thousands of United States dollars unless otherwise stated)

(Unaudited)

The Company’s mining interests are located in the following geographical locations

			September 30,			December 31,
			2014			2013
			$			$
	Mining interests
	Philippines		858,760			858,871
	Mali		513,686			-
	Namibia		402,568			289,945
	Nicaragua		291,321			286,110
	Colombia		93,548			178,368
	Burkina Faso		56,881			50,550
	Costa Rica		2,611			2,611
	Canada		845			990
			2,220,220			1,667,445

18	Commitments
	As at September 30, 2014, the Company had the following significant commitments (in addition to those disclosed elsewhere in these financial statements):

	•	Payments of $2.8 million for Otjikoto project mobile equipment to be incurred in the first quarter of 2015.
	•	Land payments of $7.9 million (the Company’s 49% share) with respect to the acquisition of land at the Gramalote project in Colombia. It is expected that $1.5 million will be paid in 2014, $6.1 million in 2015 and the remaining $0.3 million in 2016.

19	Contingencies
	ZTS Claim
	On April 7, 2014, a local Malian company, Etablissements Zoumana Traoré SARL (ZTS), filed a claim against Papillon before the Commercial Court of Bamako seeking to claim an additional shareholding in Songhoi Resources SARL (Songhoi). Papillon’s Medinandi tenement is owned by Songhoi which is a joint venture company between Papillon, who owns 90%, and its local joint venture partner, Mani SARL (Mani), who owns 10%. Mani originally acquired the tenement from ZTS in 2006. On June 26, 2014, a judge of the Commercial Court of Bamako dismissed Papillon’s arguments on jurisdiction and accepted ZTS’s claims on the merits. The hearing was supposed to be limited to the question of jurisdiction and Papillon was not given an opportunity to submit arguments on the merits of the case. Notwithstanding, the judgement held that ZTS holds 17% of Songhoi’s share capital, 10% of which is already indirectly held by ZTS through Mani. In addition, the judge awarded damages to ZTS in an amount of 3 billion CFA francs (approximately $5.8 million) and a penalty amount of 100 million CFA francs (approximately $0.2 million) per day for any delay in effecting the decision of the judge. The Company considers the decision to be totally unlawful and has appealed the decision to the Court of Appeal in Bamako. The Company has accordingly not made an accrual for any element of these damages. In addition, Papillon has initiated International Chamber of Commerce (ICC) arbitral proceedings in Paris in order to secure its rights against ZTS and other respondents, which has been registered by the ICC Secretariat.
	The Company believes that it is not probable that the claim by ZTS will be successful and accordingly, no provision for any liability has been recognised in these financial statements.

15

B2GOLD CORP.
MINING INTERESTS SCHEDULE (NOTE 20)
For the nine months ended September 30, 2014
(All tabular amounts are in thousands of United States dollars unless otherwise stated)
(Unaudited)

		Cost															Accumulated depreciation												Net carrying value
		Balance at Dec. 31, 2013			Acquisition costs/ Additions			Disposals/ write-offs			Cumulative translation adjustment			Balance at Sep. 30, 2014			Balance at Dec. 31, 2013			Depreciation			Disposals/ write-offs			Balance at Sep. 30, 2014			As at Sep. 30, 2014			As at Dec. 31, 2013
		$			$			$			$			$			$			$			$			$			$			$
Property, plant and equipment (depletable)
Masbate mine		723,155			40,122			(5,647	)		-			757,630			(40,744	)		(35,385	)		801			(75,328	)		682,302			682,411
Libertad (including Jabali)		259,518			30,049			-			-			289,567			(83,927	)		(33,291	)		-			(117,218	)		172,349			175,591
Limon		120,139			16,844			-			-			136,983			(44,970	)		(12,009	)		-			(56,979	)		80,004			75,169
		1,102,812			87,015			(5,647	)		-			1,184,180			(169,641	)		(80,685	)		801			(249,525	)		934,655			933,171
Masbate undeveloped mineral interests		176,460			-			-			-			176,460			-			-			-			-			176,460			176,460
Mine under construction
Otjikoto		289,945			139,897			-			(27,274	)		402,568			-			-			-			-			402,568			289,945
Exploration & evaluation properties (non- depletable)
Fekola		-			507,618			-			-			507,618			-			-			-			-			507,618			-
Kiaka		50,550			5,928			-			-			56,478			-			-			-			-			56,478			50,550
Mocoa		28,200			406			-			-			28,606			-			-			-			-			28,606			28,200
Trebol & Pavon		24,870			2,232			(364	)		-			26,738			-			-			-			-			26,738			24,870
San Jose		1,123			95			-			-			1,218			-			-			-			-			1,218			1,123
Calibre		8,496			939			-			-			9,435			-			-			-			-			9,435			8,496
Other		861			7,185			-			-			8,046			-			-			-			-			8,046			861
		114,100			524,403			(364	)		-			638,139			-			-			-			-			638,139			114,100
Corporate & other
Bellavista		2,611			-			-			-			2,611			-			-			-			-			2,611			2,611
Office, furniture & equipment		1,688			44			-			-			1,732			(698	)		(189	)		-			(887	)		845			990
		4,299			44			-			-			4,343			(698	)		(189	)		-			(887	)		3,456			3,601
		1,687,616			751,359			(6,011	)		(27,274	)		2,405,690			(170,339	)		(80,874	)		801			(250,412	)		2,155,278			1,517,277
Investments in joint ventures (accounted for using the equity method)
Gramalote		148,967			11,101			(96,327	)		-			63,741			-			-			-			-			63,741			148,967
Quebradona		1,201			-			-			-			1,201			-			-			-			-			1,201			1,201
		150,168			11,101			(96,327	)		-			64,942			-			-			-			-			64,942			150,168
		1,837,784			762,460			(102,338	)		(27,274	)		2,470,632			(170,339	)		(80,874	)		801			(250,412	)		2,220,220			1,667,445

16

B2GOLD CORP.
MINING INTERESTS SCHEDULE (NOTE 20)
For the year ended December 31, 2013
(All tabular amounts are in thousands of United States dollars unless otherwise stated)
(Unaudited)

		Cost															Accumulated depreciation												Net carrying value
		Balance at Dec. 31, 2012			Acquisition costs/ Additions			Disposals/ write-offs			Cumulative translation adjustment			Balance at Dec. 31, 2013			Balance at Dec. 31, 2012			Depreciation			Disposals/ write-offs			Balance at Dec. 31, 2013			As at Dec. 31, 2013			As at Dec. 31, 2012
		$			$			$			$			$			$			$			$			$			$			$
Property, plant and equipment (depletable)
Masbate mine		-			723,155			-			-			723,155			-			(40,744	)		-			(40,744	)		682,411			-
Libertad (including Jabali)		215,941			43,577			-			-			259,518			(51,673	)		(32,254	)		-			(83,927	)		175,591			164,268
Limon		105,727			14,412			-			-			120,139			(27,349	)		(17,621	)		-			(44,970	)		75,169			78,378
		321,668			781,144			-			-			1,102,812			(79,022	)		(90,619	)		-			(169,641	)		933,171			242,646
Masbate undeveloped mineral interests		-			176,460			-			-			176,460			-			-			-			-			176,460			-
Mine under construction
Otjikoto		118,798			210,252			-			(39,105	)		289,945			-			-			-			-			289,945			118,798
Exploration & evaluation properties (non- depletable)
Kiaka		-			50,550			-			-			50,550			-			-			-			-			50,550			-
Mocoa		27,539			661			-			-			28,200			-			-			-			-			28,200			27,539
Trebol & Pavon		24,333			537			-			-			24,870			-			-			-			-			24,870			24,333
San Jose		-			1,123			-			-			1,123			-			-			-			-			1,123			-
Calibre		7,112			1,384			-			-			8,496			-			-			-			-			8,496			7,112
Cebollati		9,051			513			(9,564	)		-			-			-			-			-			-			-			9,051
Other		-			861			-			-			861			-			-			-			-			861			-
		68,035			55,629			(9,564	)		-			114,100			-			-			-			-			114,100			68,035
Corporate & other
Bellavista		2,601			10			-			-			2,611			-			-			-			-			2,611			2,601
Office, furniture & equipment		1,173			515			-			-			1,688			(528	)		(170	)		-			(698	)		990			645
		3,774			525			-			-			4,299			(528	)		(170	)		-			(698	)		3,601			3,246
		512,275			1,224,010			(9,564	)		(39,105	)		1,687,616			(79,550	)		(90,789	)		-			(170,339	)		1,517,277			432,725
Investments in joint ventures (accounted for using the equity method)
Gramalote		100,798			48,169			-			-			148,967			-			-			-			-			148,967			100,798
Quebradona		1,201			-			-			-			1,201			-			-			-			-			1,201			1,201
		101,999			48,169			-			-			150,168			-			-			-			-			150,168			101,999
		614,274			1,272,179			(9,564	)		(39,105	)		1,837,784			(79,550	)		(90,789	)		-			(170,339	)		1,667,445			534,724

17