Mr. Simon Henderson reports

GLASS EARTH GOLD LIMITED: FINANCIAL STATEMENTS AND MANAGEMENT'S DISCUSSION & ANALYSIS FOR THE FIRST QUARTER ENDED MARCH 31, 2013

Glass Earth Gold Ltd. has filed its March 31, 2013, first quarter financial statements and associated management's discussion and analysis report pertaining to that period with regulatory authorities.

Operational activities

The company's corporate and exploration activities for the quarter are summarized in the attached quarterly overview. The company's cash position as at March 31, 2013, was $1,192,000 with trade payables of $497,000.

The company faced a highly challenging quarter with the profitability of its placer mining operations pressured from a drop in gold prices and lower than expected productivity and grade. As a result, the company reports a net loss for the three months ended March 31, 2013, of $820,000 versus $1,236,000 for the similar period in 2012.

                         FINANCIAL HIGHLIGHTS

                                       Three months      Three months
                                              ended             ended
                                     March 31, 2013    March 31, 2012

Gold mining revenue                      $1,381,000          $167,000
Mining costs                             (1,627,000)         (185,000)
Depreciation and amortization              (270,000)           (6,000)
Gross (loss)                               (516,000)          (24,000)
Administrative and personnel
expenses                                   (215,000)         (346,000)
Salaries (net of exploration costs)         (69,000)          (64,000)
Finance (loss)/income                       (20,000)           14,000
Writedown of mineral properties                  --          (260,000)
(Loss) before and after income taxes       (820,000)       (1,236,000)

Placer mining

While management devoted a considerable time to setting up placer mining operations, its profitability has been disappointing. It reported a negative cash cost of $246,000 for the quarter, with lower cash losses expected for second quarter. This is due to continuing productivity and cost inefficiencies in operating two sites, during the day only, coupled with a dramatic drop in the price of gold.

During first quarter 2013, 78,000 cubic metres of gold-bearing wash were processed at a recovered grade of 330 milligrams per cubic metre for 830 ounces gold. That was 20 per cent under budget and the major reason for cash generation underperformance.

Therefore, the company's response to the losses incurred is to maximize efficiencies and reduce leased equipment costs by changing to a mining regime on a 24-7 basis on one site only. Grade control is also being reassessed in light of the reduced gold price. The changeover is scheduled for late May.

"In spite of the severity of the adverse market conditions, management believes in the benefits of a consistent and focused strategy, supported by the full support and dedication of our team," said Simon Henderson, chief executive officer of Glass Earth Gold.

In second quarter, Glass Earth is expecting to report a cash loss from placer mining, but that trend is expected to reverse with the noted changes, and placer mining is expected to generate positive cash flow in third quarter and fourth quarter while producing approximately 2,600 ounces of gold.

Mr. Henderson added: "The uncertainties around the price of gold remain a major concern. Our forecasts for the next quarter points towards modest profitability and positive cash generation, based on price of $1,400 (U.S.) per ounce, which we believe is sustainable. Moreover, the Glass Earth gold team remains committed to delivering enhanced results on operational metrics, therefore supporting the validity of our business model at this stage. We believe that consistency and determination in the execution of our business model remains the company's best asset and will enable us to ride through this challenging period."

Mr. Henderson, MSc, geology (Codes), an AusIMM chartered professional under the discipline of geology, is a qualified person as defined by National Instrument 43-101 and an employee of the company and has reviewed and approved the technical information given herein.