CONSOLIDATED FINANCIAL STATEMENTS

THREE AND SIX MONTHS ENDED
JUNE 30, 2007

(Expressed in Canadian Dollars, unless otherwise stated)

(Unaudited)

These financial statements have not been reviewed by the Company's auditors

CONTINENTAL MINERALS CORPORATION
Consolidated Balance Sheets
(Expressed in Canadian Dollars)

		June 30			December 31
		2007			2006
		(unaudited)
Assets
Current assets
Cash and cash equivalents	$	25,985,425		$	1,791,802
Amounts receivable		328,049			227,598
Amounts due from related parties (note 8)		307,779			643,055
Prepaid expenses		88,301			168,078
		26,709,554			2,830,533
Mineral property interest (note 5)		115,807,309			112,747,309
Equipment (note 4)		566,863			523,327
Investments		1			1
	$	143,083,727		$	116,101,170
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities	$	1,226,145		$	3,581,150
Loan from related party (note 8)		–			1,500,000
Current portion of long-term payable		577,300			578,650
Convertible promissory note (note 6)		–			11,034,366
		1,803,445			16,694,166
Long-term payable		1,731,900			1,735,950
Future income tax liabilities		25,505,550			26,948,000
		27,237,450			28,683,950
Shareholders' equity
Share capital (note 7)		156,476,425			107,421,628
Convertible promissory note - conversion right		–			695,932
Contributed surplus (note 7)		8,712,665			4,322,759
Deficit		(51,146,258	)		(41,717,265	)
		114,042,832			70,723,054
Continuing operations (note 1)
	$	143,083,727		$	116,101,170

See accompanying notes to the consolidated financial statements

Approved by the Board of Directors

/s/ Gerald S. Panneton	/s/ Jeffrey Mason
Gerald S. Panneton	Jeffrey Mason
Director	Director

CONTINENTAL MINERALS CORPORATION
Consolidated Statements of Operations
(Unaudited – Expressed in Canadian Dollars)

		Three months ended June 30						Six months ended June 30
		2007			2006			2007			2006
Expenses
Conference and travel	$	424,161		$	197,044		$	579,904		$	346,488
Exploration (schedule)		3,836,913			5,246,327			6,259,570			7,442,880
Foreign exchange		(1,759,626	)		33,019			(1,681,190	)		26,822
Insurance expense		45,036			–			90,072			–
Interest expense		3,938			(7,634	)		362,949			(24,731	)
Interest income		(316,958	)		–			(410,162	)		–
Legal, accounting and audit		198,226			227,975			264,043			383,270
Loss on extinguishment of convertible promissory note (note 6)		–			–			376,366			–
Office and administration		765,361			476,002			1,403,394			884,616
Shareholder communications		70,978			107,029			136,820			206,229
Stock-based compensation – exploration (note 7(d))		97,017			162,199			114,857			194,814
Stock-based compensation – administration (note 7(d))		842,478			371,896			1,307,611			600,422
Trust and filing		17,023			17,318			59,125			31,698
Loss before non-controlling interest		4,224,547			6,831,175			8,863,359			10,092,508
Non-controlling interest		–			–			–			(944,880	)
Loss and comprehensive loss for the period	$	4,224,547		$	6,831,175		$	8,863,359		$	9,147,628
Basic and diluted loss per common share	$	(0.03	)	$	(0.13	)	$	(0.08	)	$	(0.19	)
Weighted average number of common shares outstanding		120,790,152			51,080,722			110,427,961			49,223,744

See accompanying notes to the consolidated financial statements

Consolidated Statements of Operations
(Unaudited – Expressed in Canadian Dollars)

		Six months ended June 30
		2007			2006
Balance at beginning of period, as previously reported	$	(41,717,265	)	$	(15,001,192	)
Adjustment for adoption of new accounting standards (note 3(a))		(565,634	)		–
As restated		(42,282,899	)		(15,001,192	)
Loss for the period		(8,863,359	)		(9,147,628	)
Balance at end of the period	$	(51,146,258	)	$	(24,148,820	)

See accompanying notes to the consolidated financial statements

CONTINENTAL MINERALS CORPORATION
Consolidated Statements of Cash Flows
(Unaudited – Expressed in Canadian Dollars)

		Three months ended June 30						Six months ended June 30
Cash provided by (used for)		2007			2006			2007			2006
Operating activities
Loss for the period	$	(4,224,547	)	$	(6,831,175	)	$	(8,863,359	)	$	(9,147,628	)
Items not involving cash
Accretion of convertible promissory note		–			–			98,634			–
Amortization		92,835			27,484			169,241			48,061
Foreign exchange		(2,166,450	)		–			(2,212,850	)		–
Interest paid by issuance of common shares		–			–			156,274			–
Loss on extinguishment of convertible promissory note		–			–			376,366			–
Non-controlling interest		–			–			–			(944,880	)
Stock-based compensation		939,495			534,095			1,422,468			795,236
Changes in non-cash operating working capital
Accounts payable and accrued liabilities		25,226			262,960			(2,355,005	)		352,654
Amounts receivable		(138,962	)		(91,276	)		(100,451	)		(281,052	)
Prepaid expenses		39,617			(462,121	)		79,777			(461,620	)
Cash used for operating activities		(5,432,786	)		(6,560,033	)		(11,228,905	)		(9,639,229	)
Investing activities
Acquisition of fixed assets		(191,847	)		(195,901	)		(212,777	)		(413,017	)
Cash used for investing activities		(191,847	)		(195,901	)		(212,777	)		(413,017	)
Financing activities
Issuance of common shares, net of issue costs		17,000			4,769,861			48,875,029			4,932,161
Repayment of convertible promissory note		–			–			(12,075,000	)		–
Repayment of loan from related party		(34,998	)		–			(1,500,000	)		–
Due to (from) related parties		–			1,597,750			335,276			1,856,798
Cash provided by (used for) financing activities		(17,998	)		6,367,611			35,635,305			6,788,959
Increase (decrease) in cash and cash equivalents		(5,642,631	)		(388,323	)		24,193,623			(3,263,287	)
Cash and cash equivalents, beginning of period		31,628,056			1,134,280			1,791,802			4,009,244
Cash and cash equivalents, end of period	$	25,985,425		$	745,957		$	25,985,425		$	745,957
Components of cash and cash equivalents are as follows:
Cash	$	476,060		$	526,589		$	476,060		$	526,589
Bankers acceptances and term deposits		25,509,365			219,368			25,509,365			219,368
	$	25,985,425		$	745,957		$	25,985,425		$	745,957
Supplementary information
Taxes paid	$	–		$	–		$	–		$	–
Interest paid	$	3,938		$	–		$	159,885		$	–
Non-cash financing and investing activities
Fair value of stock options transferred from contributed surplus to
share capital upon exercise of options	$	6,500		$	104,281		$	23,494		$	104,281

See accompanying notes to the consolidated financial statements

CONTINENTAL MINERALS CORPORATION
Consolidated Schedules of Exploration Expenses
(Unaudited – Expressed in Canadian Dollars)

		Three months ended June 30					Six months ended June 30
Xietongmen Property, China		2007			2006		2007		2006
Exploration Costs
Amortization	$	92,835		$	27,484	$	169,241	$	48,061
Assays and analysis		194,277			558,366		261,935		900,382
Drilling		515,944			1,851,605		515,944		2,570,649
Engineering		1,466,815			953,944		2,485,102		1,043,687
Environmental		426,354			171,533		447,494		171,533
Equipment rentals and leases		97,944			161,658		150,762		248,430
Freight		13,145			16,155		23,167		16,155
Geological		212,552			603,337		336,865		954,859
Graphics		8,680			32,708		19,290		50,888
Property and finders' fees		(10,508	)		22,001		132,838		22,001
Site activities		464,432			487,646		799,770		759,782
Socioeconomic		255,247			146,375		717,808		314,353
Transportation		99,196			213,515		199,354		342,100
Incurred during the period		3,836,913			5,246,327		6,259,570		7,442,880
Non-cash stock-based compensation		97,017			162,199		114,857		194,814
		3,933,930			5,408,526		6,374,427		7,637,694
Cumulative balance, beginning of period		32,043,594			11,945,744		29,603,097		9,716,576
Cumulative balance, end of period	$	35,977,524		$	17,354,270	$	35,977,524	$	17,354,270

CONTINENTAL MINERALS CORPORATION

Notes to Consolidated Financial Statements

For the three and six months ended June 30, 2007

(Unaudited – Expressed in Canadian Dollars)

1.	NATURE OF OPERATIONS
	These interim consolidated financial statements are prepared in accordance with Canadian generally accepted accounting principles and are presented in Canadian dollars. They do not include all the disclosures as required for annual financial statements under generally accepted accounting principles. However, these interim consolidated financial statements follow the same accounting policies and methods of application as the Company's most recent annual financial statements. These interim consolidated financial statements should be read in conjunction with the Company's annual consolidated financial statements for the year ended December 31, 2006.
	Operating results for the three month and six month periods ended June 30, 2007 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2007 or for any other period.
	These consolidated financial statements are prepared on the basis that the Company will continue as a going concern. Management recognizes that the Company will need to generate additional financial resources in order to meet its planned business objectives. However, there can be no assurances that the Company will continue to obtain additional financial resources and/or achieve profitability or positive cash flows. If the Company is unable to obtain adequate additional financing, the Company will be required to curtail operations and exploration activities. Furthermore, failure to continue as a going concern would require that the Company's assets and liabilities be restated on a liquidation basis which would differ significantly from the going concern basis.
2.	BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION
	These consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles. The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries.
	All material inter-company balances and transactions have been eliminated.
3.	CHANGES IN ACCOUNTING POLICIES
	Effective January 1, 2007, the Company adopted the following new accounting standards issued by the Canadian Institute of Chartered Accountants ("CICA") relating to financial instruments. These new standards have been adopted on a prospective basis with no restatement to prior period financial statements.
	(a)	Section 3855 – Financial Instruments – Recognition and Measurement
		This standard sets out criteria for the recognition and measurement of financial instruments for fiscal years beginning on or after October 1, 2006. This standard requires all financial instruments within its scope, including derivatives, to be included on a Company's balance sheet and measured either at fair value or, in certain circumstances when fair value may not be considered most relevant, at cost or amortized cost. Changes in fair value are to be recognized in the statements of operations and comprehensive income (loss).

CONTINENTAL MINERALS CORPORATION

Notes to Consolidated Financial Statements

For the three and six months ended June 30, 2007

(Unaudited – Expressed in Canadian Dollars)

All financial assets and liabilities are recognized when the entity becomes a party to the contract creating the asset or liability. As such, any of the Company's outstanding financial assets and liabilities at the effective date of adoption are recognized and measured in accordance with the new requirements as if these requirements had always been in effect. Any changes to the fair values of assets and liabilities prior to January 1, 2007 are recognized by adjusting opening deficit or opening accumulated other comprehensive income (loss).

All financial instruments are classified into one of the following five categories: held for trading, held-to-maturity, loans and receivables, available-for-sale financial assets, or other financial liabilities. Initial and subsequent measurement and recognition of changes in the value of financial instruments depends on their initial classification:

• Held-to-maturity investments, loans and receivables, and other financial liabilities are initially measured at fair value and subsequently measured at amortized cost.

• Available-for-sale financial assets are measured at fair value. Revaluation gains and losses are included in other comprehensive income (loss) until the asset is removed from the balance sheet.

• Held for trading financial instruments are measured at fair value. All gains and losses are included in net earnings (loss) in the period in which they arise.

• All derivative financial instruments are measured at fair value, even when they are part of a hedging relationship. All gains and losses are included in net earnings (loss) in the period in which they arise.

	At January 1, 2007, upon adoption of this standard, the Company remeasured its financial assets and liabilities. The convertible promissory note (note 6) was classified as held for trading and its carrying value was adjusted to $11,600,000 with a charge to opening deficit of $565,634.
(b)	Section 3865 – Hedges
	This new standard specifies the circumstances under which hedge accounting is permissible and how hedge accounting may be performed. The Company currently does not have any hedges.
(c)	Section 1530 – Comprehensive Income (Loss)
	Comprehensive income (loss) is the change in the Company's net assets that results from transactions, events, and circumstances from other than the Company's shareholders. This standard requires certain gains and losses that would otherwise be recorded as part of net earnings to be presented in other "comprehensive income (loss)" until it is considered appropriate to recognize into net earnings (loss). This standard requires the presentation of comprehensive income (loss), and its components in a separate financial statement that is displayed with the same prominence as the other financial statements.
	Accordingly, the Company now reports comprehensive income (loss) and includes, if applicable, the account "accumulated other comprehensive income (loss)" in the shareholders' equity section of the consolidated balance sheet.

CONTINENTAL MINERALS CORPORATION

Notes to Consolidated Financial Statements

For the three and six months ended June 30, 2007

(Unaudited – Expressed in Canadian Dollars)

4. EQUIPMENT

		June 30, 2007						December 31, 2006
				Accumulated		Net book				Accumulated		Net book
		Cost		amortization		value		Cost		amortization		value
Buildings	$	47,847	$	17,468	$	30,379	$	47,848	$	10,769	$	37,079
Computers		101,427		43,485		57,942		78,840		20,399		58,441
Field		180,093		72,215		107,878		126,182		36,638		89,544
Furniture		24,251		11,545		12,706		17,600		5,996		11,604
Vehicles		525,672		167,714		357,958		396,044		69,385		326,659
	$	879,290	$	312,427	$	566,863	$	666,514	$	143,187	$	523,327

5. MINERAL PROPERTY INTEREST

Xietongmen Property		June 30, 2007		December 31, 2006
Balance, beginning of the year	$	112,747,309	$	1,903,525
Acquired during the period:
Acquisition of Great China Mining Inc.		–		75,212,559
Future income tax related to acquisition of Great China Mining		–		25,070,000
Acquisition of surrounding properties		–		8,546,225
Future income tax related to acquisition of surrounding		–		1,595,000
properties
Mining permit costs		2,295,000		315,000
Future income tax related to mining permit costs		765,000		105,000
Balance, end of the period	$	115,807,309	$	112,747,309

6.

CONVERTIBLE PROMISSORY NOTE

In February 2007, Taseko Mines Limited ("Taseko"), a public company related by virtue of having certain directors in common with the Company, redeemed the convertible promissory note with a face value of $11,500,000 for $12,075,000, and concurrently exercised its participation right to participate in the private placement in the Company for $12,075,000 and acquired 7,318,181 units at a price of $1.65 per unit. Each unit was comprised of one common share and one share purchase warrant exercisable into one common share at $1.80 until February 20, 2008.

CONTINENTAL MINERALS CORPORATION

Notes to Consolidated Financial Statements

For the three and six months ended June 30, 2007

(Unaudited – Expressed in Canadian Dollars)

The continuity of the convertible promissory note is as follows:

Convertible promissory note at December 31, 2006	$	11,034,366
Adjustment to estimated fair value upon adoption of new accounting standard		565,634
As restated, January 1, 2007		11,600,000
Accretion for the period		98,634
Convertible promissory note at redemption date, February 2007		11,698,634
Redemption of convertible promissory note		(12,075,000	)
Loss on extinguishment of convertible promissory note	$	(376,366	)

7. SHAREHOLDERS' EQUITY

(a)	Authorized share capital
	•	an unlimited number of common shares without par value; and
	•	an unlimited number of non-voting, redeemable preferred shares without par value.
(b)	Issued and outstanding common share capital

	Number of		Dollar
	common shares		amount
Balance, December 31, 2006	91,239,417	$	107,421,628
Private placement, February 2007, net of issue costs (i)	19,439,395		30,829,329
Private placement, March 2007 (ii)	10,000,000		18,000,000
Share purchase options exercised	30,000		45,700
Shares issued for interest on convertible promissory note (note 8(d))	89,229		156,274
Fair value of stock options allocated to shares issued on exercise	–		23,494
Balance, June 30, 2007	120,798,041	$	156,476,425

(i)	In February 2007, the Company completed a private placement of 19,439,395 units at a price of $1.65 per unit for gross proceeds of $32,075,000 ($30,829,329 net of issue costs). Each unit consisted of one common share and one common share purchase warrant exercisable to purchase an additional common share at a price of $1.80 until February 20, 2008. The warrants are subject to accelerated expiration which can be triggered at the election of the Company, on 30 days notice, if the Company's common shares trade at a price of $2.25 for any ten consecutive day period.
	In connection with the financing, Taseko redeemed its convertible promissory note (note 6) for $12,075,000 and participated in this private placement by acquiring 7,318,181 units for $12,075,000.
(ii)	On March 29, 2007, the Company completed a private placement of 10,000,000 units at a price of $1.80 per unit for gross proceeds of $18,000,000. Each unit consisted of one common share and one common share purchase warrant. Each warrant is exercisable for 0.8 of a common share at

CONTINENTAL MINERALS CORPORATION

Notes to Consolidated Financial Statements

For the three and six months ended June 30, 2007

(Unaudited – Expressed in Canadian Dollars)

$2.25 per share until September 29, 2007, and at $2.75 per share thereafter until December 29, 2007.

(c)	Warrants
	The continuity of the number of share purchase warrants is as follows:

		Dec. 29		Feb. 20		Dec. 15		Feb. 14
Expiry date		2007		2008		2008		2009
Exercise price	$	2.25/$2.75	$	1.80	$	1.59	$	1.59
Note reference		note 7(b)(ii)		note 7(b)(i)
Balance, December 31, 2006		–		–		1,000,000		500,000
Issued		8,000,000		19,439,395		–		–
Balance, June 30, 2007		8,000,000		19,439,395		1,000,000		500,000

(d)	Share purchase option plan
	The continuity of the number of share purchase options is as follows:

Share purchase options outstanding	Number of			Weighted average
	options			exercise price
Balance, December 31, 2006	5,189,107		$	1.66
Granted	1,911,000			2.01
Exercised	(30,000	)		1.52
Expired or cancelled	(31,832	)		1.93
Balance, June 30, 2007	7,038,275		$	1.76

The exercise prices of all share purchase options granted were at or above the market price at the grant date. Using an option pricing model with the assumptions noted below, the estimated fair value of all options granted or vesting during the three and six months ended June 30, 2007, and which have been reflected in the consolidated statements of operations, is as follows:

Transactions		Three months ended June 30				Six months ended June 30
		2007		2006		2007		2006
Exploration
Engineering	$	7,077	$	3,871	$	14,647	$	5,052
Environmental, socioeconomic and land		–		976		–		1,407
Geological		89,940		105,323		100,210		136,326
Exploration		97,017		110,170		114,857		142,785
Operations and administration		842,478		352,275		1,307,611		580,801
Total compensation cost recognized in	$	939,495	$	462,445	$	1,422,468	$	723,586
operations, credited to contributed surplus

CONTINENTAL MINERALS CORPORATION

Notes to Consolidated Financial Statements

For the three and six months ended June 30, 2007

(Unaudited – Expressed in Canadian Dollars)

The weighted-average assumptions used to estimate the fair value of options vesting during the respective periods were as follows:

	Three months ended June		Six months ended June 30
	30
	2007	2006	2007	2006
Risk free interest rate	3.77%	4.25%	3.77%	4.25%
Expected life	3.1 years	2.9 years	3.1 years	2.9 years
Expected volatility	89%	69%	89%	69%
Expected dividends	nil	nil	nil	nil

	Subsequent to June 30, 2007, a total of 35,000 options were cancelled.
(e)	Contributed surplus

Balance, December 31, 2006	$	4,322,759
Changes during the period
Non-cash stock-based compensation		1,422,468
Mining permit cost		2,295,000
Conversion right, credited to contributed surplus upon extinguishment of the		695,932
convertible promissory note
Share purchase options exercised, credited to share capital		(23,494	)
Balance, June 30, 2007	$	8,712,665

8. RELATED PARTY BALANCES AND TRANSACTIONS

Due from (to) related party		June 30		December 31
		2007		2006
Loan from Hunter Dickinson Inc. (‘HDI") (a)	$	–	$	(1,500,000	)
Hunter Dickinson Inc.	$	307,779	$	643,055

Transactions		Three months ended June 30				Six months ended June 30
		2007		2006		2007		2006
Hunter Dickinson Inc. –
Reimbursement for third party expenses
and services rendered	$	738,745	$	1,051,526	$	1,292,750	$	1,811,139
Interest paid (a) and (b)	$	–	$	–	$	44,605	$	–
Taseko Mines Limited – Interest paid (d)	$	–	$	–	$	254,155	$	–
Payments to companies controlled by
Zhi Wang, a director (c)	$	121,937	$	–	$	461,913	$	52,967
Payments to Xiaojun Ma, a director (e)	$	6,435	$	–	$	15,042	$	–

CONTINENTAL MINERALS CORPORATION

Notes to Consolidated Financial Statements

For the three and six months ended June 30, 2007

(Unaudited – Expressed in Canadian Dollars)

(a)	In November 2006, the Company signed a loan agreement with HDI pursuant to which the Company borrowed $1,500,000 from HDI. On March 2, 2007, the Company repaid this loan and paid $30,575 in interest, of which $20,054 was recorded for the period three months ended March 31, 2007.
(b)	On January 23, 2007, the Company signed a second loan agreement with HDI pursuant to which the Company borrowed US$2,500,000 from HDI, maturing on April 18, 2007, on an unsecured basis. The loan bore interest at 8% per annum. The Company repaid the loan on March 2, 2007 and paid $24,551 in interest.
(c)	During the three months ended June 30, 2007, the Company paid $52,259 (three months ended June 30, 2006 – $18,594) to Honglu Investment Holdings Inc. and $69,678 (three months ended June 30, 2006 – $nil) to Tibet Bojing Minerals Exploration Limited, each of which are companies controlled by Zhi Wang, a director of the Company, for administrative and consulting services.
(d)	In February 2007, the Company redeemed the $11,500,000 convertible promissory note held by Taseko at 105% of the principal amount (note 6). Taseko and the Company are related by virtue of having certain directors in common. During the three months ended March 31, 2007, the Company paid interest related to this convertible promissory note to Taseko of $254,155, of which $156,274 was paid to Taseko by the issuance of 89,229 common shares of the Company.
(e)	Xiaojun Ma is a director of the Company who also provides managerial services to the Company's Tibetan subsidiary. During the three months ended June 30, 2007, he was paid RMB 45,000 ($6,435) (three months ended June 30, 2006 – $nil) for such services.