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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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FORM 10-K

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1997

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

for the transition period from to

Commission file number 0-17480

CROWN RESOURCES CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

WASHINGTON 84-1097086
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)

1675 BROADWAY, SUITE 2400 80202
DENVER, COLORADO (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (303) 534-1030

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

COMMON STOCK, $0.01 PAR VALUE
(TITLE OF CLASS)

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [_]

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained to
the best of registrant's knowledge in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [_]

The aggregate market value of voting stock held by nonaffiliates of the
registrant was approximately $57,241,636 based upon the closing price on March
9, 1998.

There were 14,520,725 shares of common stock, $0.01 par value, outstanding
on March 9, 1998.

This Form 10-K consists of 47 pages
Exhibit Index Begins on Page 44

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TABLE OF CONTENTS
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Page
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PART I

Item 1. Business . . . . . . . . . . . . . . . . . . . . . . . . . 3
Item 2. Properties . . . . . . . . . . . . . . . . . . . . . . . . 12
Item 3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . 27
Item 4. Submission of Matters to a Vote of
Security Holders. . . . . . . . . . . . . . . . . . . . . 28

PART II

Item 5. Market for Registrant's Common Equity
and Related Stockholder Matters. . . . . . . . . . . . 30
Item 6. Selected Financial Data . . . . . . . . . . . . . . . . . 30
Item 7. Management's Discussion and Analysis of
Financial Condition and Results
of Operations . . . . . . . . . . . . . . . . . . . . 31
Item 8. Financial Statements and Supplementary Data . . . . . . . 37
Item 9. Changes in and Disagreements with

Accountants on Accounting and
Financial Disclosure . . . . . . . . . . . . . . . . . 38

PART III

Item 10. Directors and Executive Officers of the
Registrant . . . . . . . . . . . . . . . . . . . . . . . 38
Item 11. Executive Compensation . . . . . . . . . . . . . . . . . . 38
Item 12. Security Ownership of Certain Beneficial
Owners and Management . . . . . . . . . . . . . . . . . 38
Item 13. Certain Relationships and Related
Transactions . . . . . . . . . . . . . . . . . . . . . . 38

PART IV

Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K . . . . . . . . . . . . . . . . 39

Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

PART I
------

The information set forth in BUSINESS, PROPERTIES and MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS-
LIQUIDITY AND CAPITAL RESOURCES includes "forward looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, and is subject to the safe harbor created by
those sections. Factors that realistically could cause results to differ
materially from those projected in the forward looking statements are set forth
in BUSINESS, MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS-LIQUIDITY AND CAPITAL RESOURCES and CONSIDERATIONS RELATED
TO CROWN'S BUSINESS below.

ITEM 1. BUSINESS
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(a) Overview
--------

Crown Resources Corporation ("Crown" or the "Company") is a precious metals
exploration company operating in the western United States, Peru and, to a
limited extent, Argentina. Its properties and investments in Peru and Argentina
are held through Solitario Resources Corporation ("Solitario"), a 57.2%-owned
subsidiary as of December 31, 1997. The Company's principal expertise is in
identifying properties with promising mineral potential, acquiring these
properties and exploring them to an advanced stage. Crown's goal is to advance
its properties to the feasibility study stage, at which time Crown intends to
pursue development of the properties, typically through a joint venture with a
partner that has expertise in mining operations. The Company has in the past
recognized, and expects in the future to recognize, revenues from the option and
sale of property interests to joint venture partners and from the sale of its
share of gold produced on its properties.

Crown was incorporated under the laws of the State of Washington in August
1988. Unless otherwise indicated by the context, all references to Crown or the
Company in this report shall be read to refer to Crown Resources Corporation and
its subsidiaries taken together.

(b) Recent Developments
-------------------

In February 1998, the Company received $4.6 million, after commissions and
offering expenses, from a European equity financing through the private
placement of 1.04 million shares of the Company's common stock. Included in the
placement was an agency fee of 40,000 shares paid to David Williamson
Associates, Ltd., of which David R. Williamson, a director of the Company, is a
principal. See ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

of mineral potential. As a result of this decision, the Company recorded a
write-down of $3.8 million in December 1997. In early March 1998, the Company
signed a letter of intent with Toscana Resources Corporation, Ltd. ("Toscana")
of Vancouver, B.C., to sell all of the issued and outstanding shares of
Solitario's Argentina subsidiary. The purchase price of Cdn$500,000 would be
received in shares of Toscana. The transaction is subject to due diligence,
Board of Directors and regulatory approval. Solitario also received a non-
refundable binder payment of Cdn$65,000 upon signing the letter of intent.

In February 1997, the Final Environmental Impact Statement ("FEIS") for the
Crown Jewel mine was filed by the United States Forest Service ("USFS") and the
Washington Department of Ecology ("WDOE"). The FEIS describes the environmental
effects of the plan to construct and operate the Crown Jewel mine, and
alternatives to that plan. Also in February 1997, the Record of Decision for the
FEIS was filed by the USFS and the United States Bureau of Land Management
("BLM"). The Record of Decision documents the decision by the USFS and BLM to
select the mining alternative as presented in the FEIS. In May 1997 the Record
of Decision was appealed in U.S. District Court and that action is pending. See
PROPERTIES -CROWN JEWEL PROJECT and LEGAL PROCEEDINGS.

In December 1996, Solitario signed an agreement with a subsidiary of
Cominco Ltd. ("Cominco") regarding the Bongara property in northern Peru,
presently covering approximately 215,000 acres (the "Bongara project"). Cominco
has the right to earn up to a 60% interest in the Bongara project by spending a
minimum of $27,500,000 on exploration and development and by making cash
payments of $1,800,000 to Solitario over a four-year period, as well as, fully
funding the project through a bankable feasibility study. An initial cash
payment of $250,000 was paid by Cominco in January 1997 and an additional
payment of $300,000 was received in January of 1998. In addition to the cash
payments and work commitments, Cominco has agreed to finance Solitario's share
of project development costs, subject to repayment, after a production decision
is made should Solitario not secure third-party financing. See PROPERTIES -
BONGARA ZINC PROJECT.

In February 1997, the Company sold 1,500,000 of its shares in Solitario,
receiving net proceeds of $4,448,000 from the market transaction. The Company
reinvested the proceeds by acquiring, through a private placement into
Solitario, 1,500,000 new shares of Solitario plus 1,500,000 warrants,
exercisable into shares of Solitario at Cdn$4.83 per share until February 27,
1999.

In August 1997, the Company elected to convert its $1,500,000 7.5%
convertible note into 1,254,180 shares of Solitario common stock. The
conversion was in accordance with the terms of the note dated August 25, 1995.
Upon completion of the conversion and after giving effect to option exercises
during 1997, the Company held 9,633,585 shares of Solitario or 57.2% as of
December 31, 1997.

EXPLORATION AND DEVELOPMENT.

Crown's domestic mineral properties, which consist of a variety of
interests including unpatented and patented claims held under lease or in fee,
are located in Nevada, Washington and Utah. Crown's Latin American properties,
located in Peru, Mexico and until the first quarter of 1998, in Argentina,
consist of exploration concessions or mining claims held under application or
option or purchase agreements. Crown acts as operator on all of its properties
that are not held in joint ventures. The success of projects held under joint
ventures that are not operated by Crown is substantially dependent on the joint
venture partner. In particular, the operating success of the Crown Jewel Project
and the Bongara Zinc Project are largely dependent on Battle Mountain Gold
Company ("Battle Mountain" or "BMG") and Cominco, respectively, its joint
venture partners. See PROPERTIES - CROWN JEWEL PROJECT, BONGARA ZINC PROJECT.

After selecting a possible exploration area through its own efforts or with
others, the Company compiles reports, past production records and geologic
surveys concerning the area. The operator then undertakes a field exploration
program to determine whether the area merits work. Initial field exploration on
a property normally consists of geologic mapping and geochemical and/or
geophysical surveys, together with selected sampling to identify host
environments that may contain specific mineral occurrences. If an area shows
promise, the operator will generally conduct geologic drilling programs in an
effort to locate the existence of economic mineralization. If such
mineralization is delineated, further work will be undertaken to estimate ore
reserves; evaluate the feasibility for the development of the mining project,
obtain permits for commercial development and, if the project appears to be
economically viable, proceed to place the ore deposit into commercial
production.

FOREIGN OPERATIONS.

The Company presently has interests in properties located in Peru, Mexico
and until the first quarter of 1998, Argentina. These countries have from time
to time experienced periods of political and economic instability. Foreign
properties, operations and investments may be adversely affected by local
political and economic developments, including nationalization, exchange
controls, currency fluctuations, taxation and laws or policies, as well as, by
laws and policies of the United States affecting foreign trade, investment and
taxation. Furthermore, it is particularly important that the Company maintain
good relationships with the governments in the countries in which it operates.
The Company may not be able to maintain such relationships if the governments or
policies related to mining of these countries change. Certain other regions in
which the Company may conduct operations have also been subject to political and
economic instability, creating uncertainty and the potential for a loss of
resources dedicated to these regions.

The Company's property interests in Peru and Argentina are held through its
subsidiary, Solitario. Management and technical services are provided to
Solitario by Crown pursuant to a management agreement for which Crown receives
management fees. Certain directors and officers of Crown are also directors and
officers of Solitario. As such, certain of these officers devote a portion of
their time to Solitario matters from which Crown, as a majority shareholder, may
not receive the full benefit. Additionally, the fact that these officers receive
cash compensation from Crown and not from Solitario may give rise to certain
conflicts of interest between these officers' duties to Crown and to Solitario.

SOURCES OF FINANCING.

The capital required for exploration and development of properties is
substantial. The Company has financed operations through the issuance of
convertible debentures, utilization of joint venture arrangements with third
parties (generally providing that the third party will obtain a specified
percentage of the Company's interest in a certain property in exchange for the
expenditure of a specified amount), the sale by the Company of interests in
properties or other assets, and by the issuance of common stock. See
PROPERTIES - CROWN JEWEL PROJECT-FINANCING, PROPERTIES - BONGARA ZINC PROJECT
and MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS -LIQUIDITY AND CAPITAL RESOURCES.

COMPETITION AND MARKETS.

A large number of companies are engaged in the exploration and development
of mineral properties, many of which have substantially greater technical and
financial resources than the Company. Therefore, the Company may be at a
disadvantage with respect to many of its competitors in the acquisition,
exploration and development of mining properties.

The marketing of minerals is affected by numerous factors, many of which
are beyond the control of the Company. Among factors beyond the control of the
Company are the price of the raw or refined minerals in the marketplace, imports
of raw materials from other countries, the availability of adequate milling and
smelting facilities, the price of fuel, the availability and the cost of labor,
and the market price of competitive minerals.

TITLE. U.S. PROPERTIES.
----------------

The Company's domestic properties consist, to a large extent, of unpatented
mining claims on unappropriated federal land pursuant to procedures established
by the Mining Law of 1872 and other federal and state laws. These acts
generally provide that a citizen of the United States (including corporations)
may acquire a possessory right to develop and mine valuable mineral deposits
discovered upon unappropriated federal lands, provided that such lands have not
been withdrawn from mineral location, e.g., national parks, military
reservations and lands designated as part of the National Wilderness
Preservation System. The validity of all

unpatented mining claims is dependent upon inherent uncertainties and
conditions. These uncertainties relate to such non-record facts as the
sufficiency of the discovery of minerals, proper posting and marking of
boundaries, and possible conflicts with other claims not determinable from
descriptions of record. Prior to discovery of a locatable mineral thereon, a
mining claim may be open to location by others unless the owner is in possession
of the claim. In the event that the discovery of a valuable mineral deposit is
made on unpatented mining claims in the exploratory stage, the Company may not
be able to assure clear title.

The Budget Reconciliation Act of 1993 (the "1993 Act"), requires the holder
of each unpatented mining claim to pay a "claim maintenance fee" of $100 per
claim on or before August 31 of each year through 1998. To locate new
unpatented claims, the Company must pay the $100 per claim maintenance fee for
the initial assessment year and a $25 per claim location fee. If the Company
fails to pay a claim maintenance fee or a location fee as required by the 1993
Act, it conclusively forfeits the related unpatented claim.

In connection with the acquisition of the Company's properties, the Company
conducts limited reviews of title and related matters, and obtains certain
representations regarding ownership. Although the Company believes it has
conducted reasonable investigations (in accordance with standard mining
practice) of the validity of ownership, there can be no assurance that it holds
good and marketable title to all of its properties.

TITLE. LATIN AMERICAN PROPERTIES.
--------------------------

Peru
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Under Peruvian law, private parties may obtain authorization to exploit
precious and base metals and certain other minerals by applying for concessions
granted by the Peru Public Mining Registry.

Applications for concessions may cover a variety of activities including
the exploration and exploitation of metallic or non-metallic minerals,
concentration or refining of minerals, transportation through non-conventional
methods and auxiliary services to be provided to two or more mineral
concessions.

The filing of an application for concession grants the holder the exclusive
right to obtain the concession conditioned on the outcome of the approval
process. The approval process is an administrative procedure under the
authority of the Peru Public Mining Registry. The process includes a public
notice procedure allowing third parties to give notice of opposition or prior
claim, if any, before the title to the concession is granted. The approval
process may take six months to several years, depending upon the volume of
applications being filed and whether conflicting claims or objections are noted.
Although the Company believes that it has taken all necessary steps with respect
to the application and approval process for its Peru property concessions, there
is no assurance that all applications will result in issued concessions.

As of February 20, 1998, the Company has obtained titles on 126 mining
concessions, covering approximately 319,000 acres (approximately 2.47 acres per
hectare). Applications for an additional 15 concessions totaling approximately
36,000 acres have been submitted for approval.

To apply for a concession, an applicant must register with and pay to the
Peru Public Mining Registry, a fee equivalent to $2 per hectare ($0.80 per acre)
for a metallic mineral concession at the time of application. The applicant
must also pay a one-time fee of approximately $80 for each application.
Concession holders must conduct their exploration efforts in compliance with all
applicable mining laws and regulations. The concession holder must file annual
reports with the Ministry of Energy and Mines and pay a fee (the "Peruvian
Annual Rental Fee") of $2 per year per hectare until the property is in
production.

Mining concessions in Peru are granted for an indefinite period and require
only that the holder pay the applicable Peruvian Annual Rental Fee and operate
and manage the properties as described in order to keep the concessions in good
standing. If after eight years the concession holder has not produced minerals
from the property having a value of at least $100 per year per hectare, the
applicable Peruvian Annual Rental Fee is increased by $2 per year per hectare.
No royalty payments to the Peruvian government are due from the sale of minerals
produced.

Concessions and applications for concessions are transferrable. A
governmental consent is required for a transfer only if the concession covers
properties located within 50 kilometers of the border. A transfer is effective
from the date of the contract of transfer, although to be enforceable against
the government and third parties, the contract of transfer must be registered in
the Peru Public Mining Registry.

Argentina
- ---------

Under Argentine law, private parties may obtain authorization to explore
"concessions" and exploit "mining claims," precious and base metals by
applications made to the government of the province where the property is
located. Argentine and provincial laws permit foreign owners to apply for and
hold concessions and mining claims.

To apply for a concession, an applicant must pay the provincial mining
agency a fee of $0.80 per hectare ($0.32 per acre). However, when the Company
made its concession applications in 1993 and 1994, application fees were
substantially less and resulted in nominal application costs. The applicant
also must provide a work plan detailing the minimum schedule of work to be
carried out. A single company or enterprise is allowed to obtain concessions
covering no more than an aggregate of 200,000 hectares in each province. The
Company made the decision to withdraw from exploration in Argentina in order to
concentrate its attention and financial resources in Peru. Additionally, the
current precious metals markets highlighted the need to focus exploration
efforts on the best areas of mineral potential. The Company has recorded a

charge of $3.8 million to write down its holdings in Argentina as of December
31, 1997. In March 1998 the Company signed a letter of intent to sell its shares
in its Argentina subsidiary.

The filing of an application for concession grants the holder the exclusive
right to obtain the concession conditioned on the outcome of the approval
process. Although the Company believes that it has taken all necessary steps
with respect to the application and approval process for its Argentina property
concessions, there is no assurance that any or all applications will result in
issued concessions.

Mexico
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During 1997, the Company, through contractors and its own employees, began
exploration efforts in Mexico focusing on the state of Durango. These efforts
culminated in the acquisition of a mining concession covering approximately
14,000 hectares. Under Mexican law enacted in 1993, the exploration and
exploitation of minerals require the granting of separate assignations made by
the Government of Mexico of lands available for exploration or exploitation.
Authorities in the Secretariat of Commerce grant exploration concessions with a
fixed life of six years which must then be changed to an exploitation concession
or lost. Exploitation concessions have a term of 50 years which may be extended
for up to an additional 50 years.

The concessions are granted to Mexican individuals or Mexican companies
domiciled in Mexico. The Company formed a wholly-owned Mexican subsidiary,
Group Crown Exploration S.A. de C.V, ("GCE"), during 1997 to hold its Mexican
concessions.

To maintain its exploration concessions in good standing, GCE is required
to pay a fee of $0.28 per hectare for the first year, $0.86 per hectare in the
second to fourth years and $1.77 in the fifth and sixth years. This increases
to $3.55 in the first year after an exploitation concession is granted, rising
to $7.12 in the second to fourth years and settling at $12.48 per hectare
thereafter.

In addition to the above fees, GCE must also make an investment in works
and tasks on the property of approximately $12,000 during its first year rising
to approximately $35,000 for years two through four and leveling at $85,000 for
years five and six on the property it currently holds. If the current property
is converted into an exploitation concession, the work commitment increases to
an aggregate of $336,000. There are no designated royalties to be paid on
concessions.

REGULATION.

The development, production and sale of minerals is subject to federal,
state, provincial and local regulation in a variety of ways, including
environmental regulation and taxation. Federal, state, and local environmental
regulations generally have a significant effect on all companies, including the
Company, engaged in mining or other extractive activities, particularly with
respect

to the permitting requirements imposed on such companies, the possibilities of
project delays, and the increased expense required to comply with such
regulations. The Company believes it is in substantial compliance with all such
regulations in all the jurisdictions in which it operates. The Company's
management does not believe the Company's ability to proceed with its plans in a
timely and commercially reasonable manner has been affected in a materially
adverse way or in a significantly different manner from other such companies in
the industry.

The Company is subject to income taxes, state and local franchise taxes,
personal property taxes, and state severance taxes levied by various
governmental units in the countries in which the Company operates. State
severance taxes vary between the states and, within a single state, the amount
of tax, based on a percentage of the value of the mineral being extracted,
varies from mineral to mineral. The Company's operations are also subject to
taxation by each locality in which it owns mineral properties or does business.

The domestic exploration programs conducted by the Company are subject to
federal, state and local environmental regulations. A substantial portion of
the Company's mining claims are on U.S. public lands. The USFS and BLM
extensively regulate mining operations conducted on public lands. Most
operations involving the exploration for minerals are subject to existing laws
and regulations relating to exploration procedures, safety precautions, employee
health and safety, air quality standards, pollution of stream and fresh water
sources, odor, noise, dust, and other environmental protection controls adopted
by federal, state, and local governmental authorities, as well as, the rights of
adjoining property owners. The Company may be required to prepare and present
to federal, state, or local authorities data pertaining to the effect or impact
that any proposed exploration or production of minerals may have upon the
environment. All requirements imposed by any such authorities may be costly and
time-consuming, and may delay commencement or continuation of exploration or
production operations.

Future legislation and regulations are expected to continue to emphasize
the protection of the environment and, as a consequence, the activities of the
Company may be more closely regulated to further the cause of environmental
protection. Such legislation and regulations, as well as future interpretation
of existing laws, may require substantial increases in capital and operating
costs to the Company and delays, interruptions, or a termination of operations,
the extent of which cannot be predicted.

Bills proposing major changes to the mining laws of the United States have
been considered by Congress. If these bills, which include royalty fees, were
enacted in their proposed form, they could have a significant effect on the
ownership and operation of unpatented mining claims in the United States
including claims owned or held by the Company. Although it is not possible to
predict whether or in what form Congress might enact changes to the mining laws,
amendments to current laws and regulations governing

operations and activities of mining companies or more stringent implementation
thereof could have a material adverse impact on the Company.

Applicable laws and regulations require the Company to make certain capital
and operating expenditures to maintain current operations and initiate new
operations. The Company's estimate of expenditures required to comply with
applicable regulations are included in all of its budgets for its projects.
Although these costs are difficult to determine, the Company is not currently
aware of any expenditures that are required in excess of budgeted amounts. The
Company incurs expenditures for land reclamation undertaken in the normal course
of operations in compliance with federal and state land restoration laws and
regulations. Under certain circumstances, it may be required to close an
operation until a particular problem is remedied or to undertake other remedial
actions. However, the Company is not aware of the existence of any such
circumstances at this time.

GOLD PRICE.

The future profitability of the Company's operations is significantly
dependent on the price of gold. The gold price has fluctuated widely over time
due to factors beyond the Company's control and in the first quarter of 1998
reached an eighteen-year low. The factors influencing the price of gold include
interest rates, rate of inflation, the strength of the U.S. dollar in relation
to other currencies, supply and demand, economic conditions, and political
turmoil. The Company cannot predict whether gold prices will reach or remain at
a level at which its reserves can be mined profitably.

INSURANCE.

The gold mining industry is subject to risks of human injury, environmental
liability and loss of assets. The Company maintains insurance coverage
consistent with industry practice, but can give no assurance that this level of
insurance can cover all risks of harm to the Company associated with being
involved in the mining business.

EMPLOYEES.

As of March 9, 1998, the Company employed 27 persons on a full-time basis,
including nine U.S.-based employees and 18 employees in South America. The
Company considers its relations with employees to be excellent. All employees
are eligible to participate in the Company's stock option plans. None of the
Company's employees is covered by a collective bargaining agreement.

ITEM 2. PROPERTIES
----------

RESERVES AND MINERAL DEPOSITS
- -----------------------------

The following table shows gold reserves net to the Company at December 31,
1997:

Mineable Proven and Probable Reserves (1)
-----------------------------------------

Ore Gold Grade Contained Gold
(Millions of tons) (oz/ton) (000 ozs)
------------------ --------- --------------

Crown Jewel Project (2)(3) 3.820 0.185 707

(1) The information was provided by Battle Mountain, the Company's joint
venture partner. The Company's proven and probable reserves are reported
as mineable (extractable) ore reserves. Reserves do not reflect recovery
losses in the milling process, but do include allowance for dilution of ore
in the mining process. Reserves have been calculated based on a gold price
of $350 per ounce. Metallurgical recovery of 88% was estimated.

(2) While Crown has 100% ownership of the Crown Jewel Project, 54% is subject
to Battle Mountain's right to acquire an interest in the property under the
terms of the Crown Jewel Venture Agreement ("Venture Agreement") and,
therefore, these ounces have not been included above.

(3) In addition to the Company's 46% interest in the Crown Jewel Proven and
Probable Reserves shown above are mineral resource deposits of 265,000 tons
at a grade of 0.185 ounces of gold per ton.

In addition to the above, Crown has identified mineral deposits on the Cord
Ranch, Kings Canyon, Manhattan and Bongara properties.

The following discussion summarizes the primary mining properties in which
the Company has interests. Company management believes the properties described
below are favorable for mineral development, although there is no assurance that
any of the properties in which the Company has or may acquire an interest will
be economically viable.

United States
- -------------

The following map shows the location of the primary properties in which
Crown has interests in the western United States.

[Insert Map of the western United States]

CROWN JEWEL PROJECT
- -------------------

GENERAL. The Crown Jewel Project is a joint venture between the Company and
Battle Mountain, located on an approximate 8,000-acre property 24 miles east of
Oroville, Washington. The joint venture agreement provides for Battle Mountain
to fully fund exploration and development costs through the commencement of
commercial production to acquire its interest. No monies are repayable by Crown
to Battle Mountain for the costs Battle Mountain incurs prior to commercial
production. Battle Mountain is required to construct a facility to treat a
minimum of 3,000 tons of ore per day.

Crown discovered the Crown Jewel gold deposit in 1988, and has expended
approximately $3.3 million in land, acquisition and exploration costs through
December 31, 1997. In March 1990, the Company signed an option letter agreement
with Battle Mountain to form a joint venture. Upon grant of the option the
Company received $5.0 million from Battle Mountain and an additional $5.0
million in January 1991 when the option was exercised. Shortly thereafter, the
Company and Battle Mountain entered into a definitive joint venture agreement,
which replaced the option letter agreement, giving Battle Mountain the right to
earn 51% in the Crown Jewel deposit.

In May 1994, Crown and Battle Mountain reached an agreement resolving
certain contractual issues related to the Crown Jewel Venture Agreement. Under
the terms of the agreement, Battle Mountain paid to Crown $4,250,000 in cash
plus 435,897 shares of Battle Mountain common stock (valued at $4,250,000) in
exchange for (1) the right to earn an additional 3% (to 54%) in the first 1.6
million ounces of gold recovered from the Crown Jewel property and (2) release
of Battle Mountain from its obligation to make any of the quarterly $1.0 million
payments to Crown which might otherwise have become due because of startup
delays on the project. Production after 1.6 million ounces of gold are recovered
will be shared 51% by Battle Mountain and 49% by Crown. The Company does not
anticipate receiving additional mineral property proceeds from Battle Mountain
under the joint venture agreement.

GEOLOGY AND LAND. The Crown Jewel deposit occurs within a large skarn
system formed at the southern contact of the Buckhorn Mountain Cretaceous-aged
diorite-granodiorite pluton with Triassic-aged limestones and andesites. Both
the skarn system and ore body are relatively tabular and flat-lying in geometry.
The skarn system is compositionally zoned in relation to the intrusive pluton
with gold mineralization both concordant and crosscutting to the various skarn
assemblages.

The property is held by a combination of fee ownership, private mining
leases with options to purchase, state mining leases, with the balance being
unpatented mining claims. Royalties vary from 4%-5% net smelter return ("NSR")
royalties on certain private parcels, however, the ore body as currently defined
is not subject to royalties payable to any third party.

RESERVES. The following table summarizes the Crown Jewel reserves as of
December 31, 1997, as provided by Battle Mountain :

Proven and Probable Reserves (100% basis)
- --------------------------------------------- Contained
Ounces
Grade Contained Crown's
Tons (oz/ton) Ounces 46% Share
--------- -------- --------- ---------

Crown Jewel 8,305,000 0.185 1,536,000 707,000

All reserves are considered to be open-pit mineable. The proven/probable
reserve was based on results from 765 drill holes totaling 307,038 feet. The
trial pit design utilized a 0.044 ounce per ton ("opt") gold cut off grade, a
waste to ore ratio of 11.0:1 and a metallurgical recovery factor of 88% for
gold. The assumed economic parameters applied to the design included mining
costs of $0.86 per ton of waste and ore. Processing costs were estimated at
$9.88 per ton based on a 3,000 ton per day facility. A $350 gold price was
used.

Based on the same cutoff grade and gold price, Battle Mountain has
estimated that other mineral deposits of 576,000 tons at 0.185 opt gold (100%
basis) also occur within the currently designed pit limits at Crown Jewel.

EXPLORATION. The Company began an exploration program at Crown Jewel in
mid-1988 and by the end of 1989 had drilled approximately 200 holes on the
property. Between March 1990 and December 1992, Battle Mountain drilled over 550
holes designed to both confirm and expand the known reserve. To date, only 500
acres of the approximate 2,000 acres of prospective skarn geology have been
drill-tested.

FEASIBILITY STUDY. In March 1992, the results of an independent feasibility
study commissioned by Battle Mountain were received by the Company. Based on
these results, Battle Mountain announced its decision to proceed with
development of the Crown Jewel gold deposit. The feasibility study confirmed
Battle Mountain's previous reserve estimate. The feasibility study also
estimated that approximately $40 million in capital would be required to fund
the project through to commercial production. The study estimated direct cash
production costs at $160 per ounce of gold produced. Based on current reserves,
the study indicated an approximate eight-year mine life with production
averaging 175,000 ounces (100% basis) of gold per year.

Further engineering and reserve studies by Battle Mountain since the
feasibility study was completed have generally confirmed the overall operating
cost estimates and mineable reserves of the original 1992 feasibility study.
However, capital costs are now estimated at approximately $70 million to achieve
commercial production. Battle Mountain will be responsible for funding capital
costs.

PERMITTING AND DEVELOPMENT. Battle Mountain submitted its original Plan of
Operations to the Washington State DOE and the USFS in January 1992. Several
supplemental plans that further clarified or refined the proposed operational
plans have been subsequently filed. The Draft Environmental Impact Statement
was released in June 1995.

In February 1997, the FEIS was filed by the USFS and the DOE. The FEIS
describes the environmental effects of the plan to construct and operate the
Crown Jewel mine, and alternatives to that plan. Also, in February 1997, a
favorable Record of Decision ("ROD") for the FEIS was filed by the USFS and the
BLM. The ROD documents the decision by the USFS and BLM to select the mining
alternative as presented in the FEIS. The alternative chosen by the USFS and the
BLM was the Proponent's (Battle Mountain) Alternative as described in the FEIS
and as modified by the ROD.

Several appeals by certain persons and special interest groups contesting
the FEIS were filed with the USFS in 1997. In May of 1997, the USFS Deputy
Regional Forester upheld the ROD to approve the Crown Jewel mine project,
denying four appeals which had been filed in March 1997. In May 1997, an action
was filed in U.S. District Court against the USFS appealing certain issues.

Most substantive permit applications necessary to begin construction have
been filed with the various local, state and federal agencies and are
undergoing review. As of February 1998, the Crown Jewel project has received
positive permit decisions on 40 of 64, or 63%, of all the permits necessary for
the project. In September 1997 an action was filed before the State of
Washington Pollution Control Hearings Board ("PCHB"), a state administrative
tribunal, challenging the FEIS and certain permit decisions. In March 1998, the
PCHB excluded potential appeals on certain permits regarding water quality and
wetlands permit applications.

Pending successful completion of the remaining permit applications,
resolution of the legal and administrative challenges, and the absence of a
prolonged injunction, construction of the Crown Jewel project could begin in the
spring of 1999 and is forecast to take approximately 14 months. Potential
delays due to the appeals process, permit process or litigation are difficult to
quantify. See LEGAL PROCEEDINGS.

FINANCING. In order to acquire its 54% interest in the project, Battle
Mountain is currently funding all general property, exploration and development
costs through the start of commercial production, including the construction of
a mill facility capable of processing a minimum of 3,000 tons of ore per day. No
monies are repayable by Crown to Battle Mountain for the costs incurred through
the pre-commercial production stage. Crown will be required to fund its 46%
share of production costs upon the start of commercial production. In the event
that Battle Mountain is unable to proceed with the project and must relinquish
its right to acquire a 54% interest, the Company would then make a decision to

either proceed with the project alone or seek a similar joint venture situation
with another major mining company. There is no assurance that the Company could
successfully pursue either strategy.

CORD RANCH PROJECT
- ------------------

GENERAL. In 1989, the Company entered into an exploration and mining
agreement with the surface and mineral rights owners of the 34,000-acre Cord
Ranch located in Elko County, Nevada. The lease agreement was originally for a
term of five years from August 31, 1989 and renewable thereafter.

Following several amendments, the lease no longer requires a work
commitment beyond 1997. However, the agreement calls for non-recoupable minimum
annual payments of $150,000 in each of 1998 and 1999 and recoupable annual
advance royalty payments of $200,000 in 2000 and thereafter. Pursuant to the
amended agreement, the Company may terminate the lease agreement at any time and
avoid any future obligation or commitment, except reclamation.

Two property acquisitions immediately adjacent to the Cord Ranch were made
in 1990. The Dixie Creek project, consisting of 1,240 acres, was acquired under
agreements entered into in October 1990. At approximately the same time, the
Pinon Range property, consisting of 640 acres of unpatented claims, was
acquired.

In September 1994, Crown signed an agreement which has been assigned to a
subsidiary of Royal Standard Minerals Inc. ("Royal Standard"). Royal Standard
has the right to earn a 70% interest in Crown's Cord Ranch and adjacent gold
properties. In order to vest in any of the Crown properties, Royal Standard
must fulfill the terms of the Cord lease agreement, as amended, including the
work commitment and property payments as specified. Royal Standard has reported
it has fulfilled its work commitment as of December 31, 1997. In addition,
should Royal Standard vest in the properties, it must provide Crown's share of
expenditures through the completion of a favorable feasibility study, with such
expenditures to be repaid from Crown's share of production from the properties.

GEOLOGY. The Cord Ranch properties lie on the east side of the Pinon Range
and are situated on the Carlin gold trend, where nearly four million ounces of
gold are produced annually. Paleozoic strata underlying the western parts of the
property are the same formations hosting major deposits in other sections of the
trend. The area has sustained multiple periods of deformation and structural
preparation of the rocks is very good. Gold mineralization is generally
associated with jasperoid rocks.

MINERAL DEPOSITS. To date, 418 drill holes have been completed on the Cord
Ranch project. In early 1994, the Company estimated the size of two gold
deposits, the Pinon Range and Dark Star deposits. Based on the results of 150
drill holes, the Pinon Range mineral deposit is estimated at 7.2 million tons
containing 0.025 opt of gold at a cutoff grade of 0.013 opt of gold. At Dark
Star, 61 drill holes completed by the Company during 1991-92 define a mineral
deposit totaling 7.5 million tons grading 0.020 opt of

gold at a cutoff grade of 0.013 opt of gold. Combined, the Company and Royal
Standard hold 50% of the mineral rights and 100% of the surface rights at Dark
Star.

SNOWSTORM PROJECT
- -----------------

GENERAL. The 5,400-acre Snowstorm property lies at the northwestern
extension of the Carlin trend and the northeastern extension of the Getchell
trend in northern Nevada. The property consists of approximately 2,400 acres of
100%-owned unpatented mining claims and 3,000 acres of leased fee property. The
leased property carries a NSR royalty ranging from 3% to 5% depending upon the
price of gold. In April 1997, Crown signed a Joint Venture Agreement allowing
Romarco Minerals, Inc. ("Romarco") to earn a 60% interest in the project.
Romarco must spend $2 million on exploration and make $275,000 in cash payments
to Crown over a four-year period to earn its interest.

GEOLOGY AND EXPLORATION. The geology of the project area consists of
Tertiary volcanic rocks that have undergone various degrees of hydrothermal
alteration. During 1997, Romarco completed a 10-hole drilling program totaling
7,660 feet. Low grade mineralization of up to .040 opt gold over 35 feet was
encountered in three holes. Follow-up drilling at depth is planned for 1998.

OTHER PROPERTY INTERESTS
- ------------------------

KENDALL MINE ROYALTY. In September 1991, Crown acquired Judith Gold
Corporation ("Judith"), whose primary asset is the Kendall property located near
Lewiston, Montana. Crown issued approximately 306,000 shares of common stock in
the transaction, representing 2.5% of Crown common stock then outstanding.

Canyon Resources Corporation ("Canyon") leases the Kendall property. Under
an agreement entered into by Judith and Canyon in 1987, Crown is entitled to
receive a 5% NSR royalty on production at the Kendall gold mine.

Mining of ore at the Kendall mine ceased at the end of 1994, with residual
heap leach gold production continuing through 1996. The mine produced
approximately 300,000 ounces of gold over its life, with Judith receiving the
equivalent of approximately 15,000 ounces over that period. The Kendall mine is
presently in reclamation.

LAMEFOOT MINE ROYALTY. In 1992, Crown acquired from various underlying
lease holders a 0.75% NSR royalty interest in the Lamefoot deposit for an
aggregate total of $306,000. This property lies approximately three miles from
the Kettle River Project ("KRP") mill, operated by Echo Bay Mines Ltd. ("Echo
Bay") in northeastern Washington state. Lamefoot ores represent the primary ore
feed source to the KRP mill through 1999, according to Echo Bay. Crown received
approximately $212,000 in royalties from Lamefoot during 1997. Crown expects to
receive approximately $175,000 in royalties from Lamefoot during 1998.

KINGS CANYON. The Kings Canyon property in Utah consists of 5,123 acres of
state leases. Crown holds a 100% interest in the property, subject to a 1-4% NSR
royalty to third parties.

The Company estimates the Kings Canyon property hosts a mineral deposit
that contains 6.8 million tons of material grading 0.030 opt of gold at a cutoff
grade of 0.013 opt gold. The gold occurs as sediment-hosted disseminated
mineralization in Paleozoic carbonate rocks.

In March 1995, Crown signed an agreement with Orion International Minerals
Corporation, formerly Sway Resources, Inc., ("Orion") which gave Orion the right
to earn a 51% interest in the property. To earn its interest, Orion was
required to spend $3.0 million and pay Crown 200,000 shares of Orion stock of
which 100,000 have been delivered. In December 1997, Orion canceled its option
agreement and no longer has an interest in the property.

MANHATTAN. A 100% interest in the 540-acre Manhattan property in central
Nevada was acquired in 1989. In November 1994, the Company signed a purchase
option agreement with New Concept Mining, Inc. ("New Concept"), that allows New
Concept to purchase 100% of the property by making a series of payments over a
four and one-half year period totaling $500,000. Of that amount, $390,000
remains to be paid.

SOUTH PENN. During 1997, the Company terminated its leases on the mining
claims and no longer maintains an interest in the property.

Peru
- ----

The following map shows the location of the primary properties in which the
Company has interests in South America.

[Insert Map of South America]

PERU
- ----

BONGARA ZINC PROJECT, AMAZONAS DEPARTMENT, PERU
- -----------------------------------------------

GENERAL. Pursuant to option agreements signed in 1993 (the "Bongara
option") between the Company and a private Peruvian party, the Company obtained
the right to acquire up to a thirty-year leasehold interest in the Bongara
Claims 1-10 situated in northern Peru. The Bongara option area covered
approximately 25,000 acres. During 1997, the Company relinquished its option
rights under the agreement. Since 1993, the Company has acquired approximately
215,000 additional acres in the Bongara project by staking concessions.

In December 1996, Solitario signed an agreement with a subsidiary of
Cominco regarding the Bongara project, presently covering approximately 215,000
acres. Cominco has the right to earn a 60% interest in the Bongara project by
spending a minimum of $27,500,000 on exploration and development and by making
cash payments of $1,800,000 to Solitario over a four-year period, as well as,
fully funding the project through a bankable feasibility study. Cash payments
of $250,000 and $300,000 have been paid by Cominco in January 1997 and January
1998, respectively. In addition to the cash payments and work commitments,
Cominco has agreed to finance Solitario's share of project development costs,
subject to repayment, after a production decision is made, should Solitario not
secure third-party financing. Through December 31, 1997, Cominco has spent
approximately $4.9 million on exploration of the Bongara project.

LOCATION. The Bongara project is situated approximately 350 kilometers by
paved and gravel roads from the port city of Chiclayo to the southwest, in
northern Peru. Most of the property lies within ten miles of a paved road with
access to the coast. Travel within the project area is accomplished by foot or
horseback. The property falls on the east slope of the Andes at an average
elevation of 1,500 meters.

GEOLOGY AND EXPLORATION. The property is underlain by northwest-trending
Jurassic-Cretaceous-age carbonates, fine to coarse clastic sediments, and
shales. Mapping conducted by the Company indicates that zinc mineralization
occurs within carbonate rock units in which limestone has been substantially
altered to dolomite.

Mineralization at Florida Canyon occurs primarily in the middle member of
the Chambara Formation of the Pucara Group of Jurassic geologic age. The middle
member of the Chambara is approximately 700 feet thick and contains several very
favorable rock horizons that are preferentially mineralized. Vertical
structures, which can also host zinc mineralization act as feeder structures to
the stacked stratigraphic mineralized horizons.

During 1997, 39 core holes were drilled on the Bongaraa project totaling
9,700 meters. Significant zinc mineralization was intersected in 21 of the 32
holes completed in the Florida Canyon prospect. Seven other drill holes were
located at the Florcita

prospect where four holes intersected strong mineralization.

Regional exploration has consisted of satellite imagery interpretation,
stream sediment geochemistry, geologic mapping and stratigraphic analysis,
detailed rock and soil geochemistry, and hand digging shallow prospect pits. To
date, approximately 3,000 stream sediment samples have been collected and
analyzed. Ten strongly anomalous areas have been identified by this highly
effective program resulting in the discovery of five new prospects exhibiting
zinc sulfide mineralization. These prospects and geochemically anomalous areas
are situated throughout the claim block. Zinc values in rock outcrops range from
1.0% zinc in disseminated concentrations to 10.0% zinc over widths ranging from
1.0 to 4.0 meters.

YANACOCHA GOLD PROPERTY, CAJAMARCA DEPARTMENT, PERU
- ---------------------------------------------------

GENERAL. The Yanacocha property, located in northern Peru, is comprised of
one contiguous block of approximately 155,000 acres located in the center of the
Yanacocha district. A second smaller block of 10,000 acres is situated five
miles to the northwest.

In April 1997, the Company signed an agreement with Rio Tinto, Ltd. giving
Rio Tinto the right to earn a 60% interest in the property by spending $5
million over four years.

LOCATION. The Yanacocha Gold District lies in northern Peru's Cajamarca
Department, 25 kilometers north of the historic provincial capital city of
Cajamarca (population: 100,000). The Yanacocha district is a 1.5 hour drive
north of Cajamarca on improved gravel roads. Elevations range from 2,800 meters
at Cajamarca to 4,200 meters at the highest points in and around Yanacocha.

GEOLOGY AND EXPLORATION. The property is located one mile north of South
America's largest gold mine (1996 production of 811,000 ounces of gold), Newmont
Mining Company's ("Newmont") 51%-owned and operated Yanacocha heap leach gold
mine. Total proven and probable reserves at the Yanacocha mine have been
reported by Newmont to be more than 13.9 million ounces of gold at the end of
1997. The Corona gold-copper porphyry deposit (three million ounces of gold and
one billion pounds of copper) lies one mile north of the Company's property
position.

Geologically, the Yanacocha district is situated in Tertiary-age volcanic
terrain which extends from Cajamarca to the Ecuadorian border, 350 kilometers to
the north-northwest. The volcanic rocks are underlain by Cretaceous basement
consisting of carbonate and quartzite sedimentary rocks intruded by Cretaceous
or Tertiary-age porphyritic intrusives. The gold mineralization present at
Newmont's Yanacocha mine occurs within zones of silicified volcanic rocks. The
gold and copper mineralization at the Corona deposit occurs in a typical Andean-
style gold-copper porphyry setting within an altered intrusive body.

Work conducted by Solitario and its partners has consisted of geological
mapping, rock and stream sediment geochemical sampling, helicopter-borne
geophysical surveying, ground induced-polarization surveying and core drilling.

Sixteen drill holes totaling approximately 6,900 feet have been completed
by Solitario and Rio Tinto during the past 18 months. Three areas have been
drill tested thus far. These are the Los Negritos, Shuito and Chalhuaquero gold
prospects, all situated in the south eastern portion of the claim block.
Drilling has thus far intersected anomalous gold values and strong alteration.

EL TIGRE GOLD PROPERTY, LAMBAYEQUE DEPARTMENT, PERU
- ---------------------------------------------------

GENERAL. Solitario acquired an option to earn a 60% interest in the
18,000-acre El Tigre gold property in northern Peru from Britannia Gold Corp.
("Britannia") in April 1996. To earn its interest, Solitario must spend
$900,000 on exploration and make $115,000 in cash payments to Britannia over a
four-year period. Solitario has completed its first three years' work
commitments.

GEOLOGY AND EXPLORATION. The property is underlain by Jurassic volcanic
rocks that are intensely silicified in several locations. Surface work
conducted during 1997 following drilling in 1996 delineated a copper system
approximately 2.5 miles long and 0.8 miles wide within silicified rocks that
contained anomalous gold values extending under a gravel pediment cover. The
Company completed follow-up drilling in 1998 which did not extend the
mineralization to allow it to be considered economic. No further work is
planned on the property and the Company took a $512,000 write off as of December
31, 1997.

SANTA BARBARA GOLD PROPERTY, CERRO DE PASCO REGION, PERU
- --------------------------------------------------------

GENERAL. In April 1997, the Company entered into an agreement with RTZ
Mining and Exploration ("RTZ") granting Solitario the right to earn a 60%
interest in the Santa Barbara project. The property contains approximately
12,300 acres located 120 miles northeast of Lima, Peru in the Cerro de Pasco
Region. Solitario can earn its interest in the property by spending $1.5
million over a three-year period. No cash payments are required to be made to
RTZ.

GEOLOGY AND EXPLORATION. Solitario completed 16 drill holes during 1997
totaling 9,200 feet. The two best holes intersected 512 feet grading 0.29%
copper and 0.01 opt gold and 659 feet grading 0.38% copper and 0.01 opt gold.

LA CAPILLA, LA LIBERTAD DEPARTMENT, PERU
- ----------------------------------------

During 1993, Solitario staked the majority of this property located in
north central Peru encompassing approximately 10,000 acres. Solitario performed
limited surface work through 1996 consisting of collecting soil and sediment
samples and trenching. During 1997 Solitario completed a 13-hole drilling
program totaling 6,520 feet. Although anomalous gold concentrations were

encountered in approximately half the drill holes, no economic mineralization
was intersected. Based on these results, Solitario will not conduct further
work on the property and took a $248,000 write off on the property during 1997.

ARGENTINA
- ---------

Solitario made the decision to withdraw from exploration in Argentina to
concentrate its attention and financial resources in Peru. Additionally, the
current precious metals markets highlighted the need to focus exploration
efforts on the best areas of mineral potential. As a result of this decision,
the Company recorded a write-down of $3.8 million in December 1997. In early
March 1998, the Company signed a letter of intent with Toscana Resources, Ltd.
("Toscana") of Vancouver, B.C., to sell all of the issued and outstanding shares
of Solitario's Argentina subsidiary. The purchase price of Cdn$500,000 would be
received in shares of Toscana. The transaction is subject to due diligence,
Board of Directors and regulatory approval. Solitario also received a non-
refundable binder payment of Cdn$65,000 upon signing the letter of intent.

LAS CARACHAS, SAN JUAN PROVINCE, ARGENTINA
- ------------------------------------------

The 22,000 acre Las Carachas property, acquired in 1993, consisted of three
100%-owned exploration concessions. One of the concessions was acquired in
early 1996 from Minas Argentinas, S.A., through an option grant to earn a 100%
interest, subject to a 2% NSR royalty, by spending $1,000,000 over a four-year
period. Limited work was performed on the property in 1997 and the property has
been written off at December 31, 1997.

CANADA ONDA, SAN LUIS PROVINCE, ARGENTINA
- -----------------------------------------

GENERAL. In August 1996, Solitario signed an agreement with a private
Argentine party to earn a 75% interest in the 5,000-acre Canada Onda property in
the Province of San Luis, Argentina. To earn its interest, Solitario must spend
$1,000,000 in exploration and make $250,000 in payments over a five-year period.
Solitario competed its first three years of work commitments and has
renegotiated its agreement to require no additional payment in 1998.

GEOLOGY AND EXPLORATION. The property is underlain by Precambrian
metamorphic rocks intruded by Tertiary alkalic rocks. Initial exploration work
consisted of surface geologic mapping and geochemical sampling, followed by
reverse circulation drilling, of which five holes totaling over 2,000 feet were
completed. To date, the Company has completed a reverse circulation drilling
program consisting of seventeen drill holes totaling 6,300 feet with the best
three holes intersecting 6.6 feet grading 2.2 opt gold, 6.6 feet grading 0.48
opt gold and 6.6 feet grading 0.16 opt gold.

CERRO NEGRO, SAN JUAN PROVINCE, ARGENTINA
- -----------------------------------------

No drilling was performed on this property in 1997 and efforts to joint
venture the property have not been successful.

MEXICO
- ------

During 1997, the Company, primarily through subcontractors, conducted
exploration and reconnaissance activities in Mexico, focusing its efforts in the
state of Durango. As a result of these activities the Company spent
approximately $0.1 million and acquired the La Pitarrilla concession covering
approximately 14,000 acres. The Company is planning additional exploration and
reconnaissance work in Mexico during 1998.

EXPLORATION EXPENDITURE OVERVIEW
- --------------------------------

During 1997, the Company conducted exploration activities on several of its
properties incurring approximately $3.2 million in exploration expenditures,
including $2.5 million in South America.

Several of the Company's properties are subject to leases and/or options to
purchase. The Company's share of 1998 annual lease and rental obligations and
option payments, for properties it currently holds, totals $60,000 as determined
at December 31, 1997. Certain other mining claims and properties not subject to
leases were acquired by the Company either by deed or were located by the
Company. With respect to the claims and other properties acquired by deed or
located by the Company, the obligation required to hold the claims is to pay ad
valorem property taxes in the case of the patented mining claims and fee land,
and annual rental fees in the case of the unpatented mining claims and
concessions. See BUSINESS-TITLE.

1998 WORK COMMITMENTS
---------------------

The Company's work commitments remaining to be fulfilled in 1998 are
$165,000, all of which are expected to be fulfilled by its joint venture
partners.
ANNUAL RENTALS
--------------

Annual Rentals
Rental on and Option Payments
Unpatented for Property Crown's Share
Claims and Subject to of Costs
Property Concessions Lease in 1998 in 1998(1)
- -------- ----------- ------------------- --------------

U.S.
- ----
Crown Jewel $ 56,000 $ 92,000 $ -
Cord Ranch 12,000 154,000 -
Other 26,000 97,000 16,000

PERU
- ----
Yanacocha 136,000 - -
Bongara 108,000 - -
Other - 14,000 14,000
-------- -------- -------------

TOTAL: $338,000 $357,000 $30,000

(1) Represents the Company's estimated share of rentals and option payments in
1998, based upon existing joint venture or leasing arrangements. (This estimate
does not include costs to be borne by other joint venturers.)

GLOSSARY OF MINING TERMS
- ------------------------

COMMERCIAL PRODUCTION. Commercial production is defined in various ways in
mineral joint ventures and mineral leases. The term generally refers to the
first continuous production from a mining operation at or near the designed
capacity of the facilities, for a period of one or more months, signifying the
end of the development phase and the beginning of the mining phase of the
operations.

PATENTED MINING CLAIM. Patented mining claim means a lode or placer mining
claim for which the United States has conveyed fee title to the claim holder
pursuant to the Mining Law of 1872. To obtain fee title, the claimant must
prove the existence of a valuable mineral deposit within the boundaries of the
claim and meet certain other conditions.

UNPATENTED MINING CLAIM. Unpatented mining claim means a claim to a valuable
mineral deposit established by a company or individual on land owned by the
United States, under the Mining Law of 1872, giving the owner the possessory
right to develop and mine the mineral deposit. The term also includes non-
mineral millsites located pursuant to the Mining Law of 1872. Paramount title
to the land is owned by the United States.

LODE CLAIM. Lode claims have a maximum size of 1,500 feet by 600 feet and may
be established on veins or other mineralization in solid rock. The holder of
each unpatented mining claim must pay a "claim maintenance fee" of $100 per
claim on or before August 31 of each year through 1998. To locate new
unpatented claims, the locator must pay a $100 per claim maintenance fee for the
initial assessment year and a $25 per claim location fee. Until a valuable
mineral deposit has been demonstrated to exist within an unpatented mining
claim, the claim may be subject to challenge by third parties or by the United
States.

PROVEN ORE RESERVES. That part of a mineral deposit that can be economically
and legally extracted or produced at the time of the reserve estimation. Proven
ore reserves are reserves for which (a) quantity is computed from dimensions
revealed in outcrops, trenches, workings or drill holes; grade and/or quality
are computed from the results of detailed sampling and (b) the sites for
inspection, sampling and measurements are spaced so closely and the geologic
character is so well defined that size, shape, depth and mineral content of
reserves are well established.

PROBABLE ORE RESERVES. That part of a mineral deposit that can be economically
and legally extracted or produced at the time of the reserve estimation.
Probable ore reserves are reserves for which quantity and grade and/or quality
are computed from information similar to that used for proven reserves, but the
sites for inspection, sampling and measurement are farther apart or are
otherwise less adequately spaced.

The degree of assurance, although lower than that for proven reserves, is
high enough to assume continuity between points of observation.

MINERAL DEPOSIT. Mineral deposit means a mineralized body which has been
physically delineated by drilling, underground tunneling, surface trenching and
other workings and has been found to contain mineralized material with
sufficient tonnage and grade to warrant further evaluation. Such a mineralized
body is not known to contain proven or probable ore reserves because sampling is
not yet sufficiently detailed to reliably predict that the mineralized rock can
be economically and legally mined. Any statement of the quantity of gold or
other mineral believed to be present in any mineral deposit should be regarded
as a preliminary estimate of the total quantity of the mineral present in the
mineralized body, subject to change after further exploration and development
work, and does not indicate that such quantity of mineral can be economically
extracted.

FEASIBILITY STUDY. A definitive engineering estimate or calculation of all
costs, revenues, equipment needs and production likely to be achieved when a
mine is developed. The study is used to define the economic viability of a
project and to support the search for project financing.

NET SMELTER RETURN ROYALTY. Net smelter return royalty is a royalty, payable in
cash or in-kind, based on the actual gold sales price received or gold produced
less the cost of refining at an off-site refinery.

ITEM 3. LEGAL PROCEEDINGS
-----------------

In March 1997, appeals of the Record of Decision for the Final
Environmental Impact Statement for the Crown Jewel Mine were filed against the
USFS by the following parties: (i) a joint appeal by the Okanogan Highlands
Alliance, Washington Environmental Council, Colville Indian Environmental
Protection Alliance, Washington Wilderness Coalition, Rivers Council of
Washington, and Sierra Club, Cascade Chapter; (ii) Confederated Tribes of the
Colville Reservation; (iii) Columbia River Bioregional Education Project; and
(iv) Kettle Range Conservation Group; (all groups collectively the "OHA").

In May 1997, the U.S. Forest Service Deputy Regional Forester upheld the
ROD to approve the Crown Jewel Mine project, and denied all of the above
appeals. The decision constitutes the final administrative determination of the
U.S. Department of Agriculture on the ROD and FEIS.

In late May 1997, members of the OHA filed an action against the USFS
appealing the FEIS, its decision to uphold the ROD and the denial of
administrative appeals. The action was filed in United States District Court
for the District of Oregon. In July 1997, the USFS answered the appeal and the
action is pending in United States District Court.

In June 1997, members of the OHA filed an action, in Thurston County
Superior Court, State of Washington, against the Washington Department of
Natural Resources, the WDOE, BMG and the Company requesting judicial review of
the FEIS. The action was subsequently dismissed without prejudice.

During the fourth quarter of 1997, members of the OHA filed six actions
against the WDOE before the State of Washington Pollution Control Hearings Board
("PCHB"), a state administrative tribunal, challenging the FEIS and certain
permit decisions. BMG has appealed the actions and obtained hearing dates for
May 1998 under a consolidated hearing schedule for the appeals before the PCHB.
However, in March 1998, the PCHB excluded from the consolidated hearing schedule
certain permits regarding water quality and wetlands permit applications.
Hearing dates for these issues have not been set by the PCHB, however, the
Company anticipates they may be set for the fall of 1998.

In December of 1997, the OHA filed three separate actions against WDOE in
Thurston County Superior Court, State of Washington. The actions challenge
WDOE's approval permits issued to BMG for water resource mitigation and solid
waste permit rulings. The actions are currently pending and no trial date has
been set.

The impact and timing of resolutions of these and any other appeals related
to the permitting process cannot be determined with any accuracy at this time.
See PROPERTIES - CROWN JEWEL PROJECT -PERMITTING AND DEVELOPMENT.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
---------------------------------------------------

There were no matters submitted to a vote of security holders during the
fourth quarter of 1997.

EXECUTIVE OFFICERS

The executive officers of the Company are as follows:

Name and municipality Position with the Company and business
of residence Age experience within the last five years
- --------------------- ---- ---------------------------------------

MARK E. JONES, III 58 Chairman of the Company since 1987,
Houston, Texas Chief Executive Officer from 1987 to
1993 and President from September 1989
to November 1990; Chairman and Chief
Executive Officer of Solitario since
August 1993.

CHRISTOPHER E. HERALD 44 President of the Company since November
Golden, Colorado 1990; Executive Vice President from
January 1990 to November 1990; Presi-
dent of Solitario since August 1993.

JAMES R. MARONICK 42 Vice President - Finance and Secretary/
Lakewood, Colorado Treasurer of the Company and Solitario
since September 1997; Vice President -
Finance and Secretary/Treasurer of
Consolidated Nevada Goldfields Corpora-
tion since 1994; Vice President and CFO
of Analytica, Inc. since 1989

DEBBIE W. MINO 45 Vice President - Investor Relations
Sugar Land, Texas of the Company since 1989.

WALTER H. HUNT 46 Vice President - Peru Operations of the
Lima, Peru Company and Solitario since July 1994;
Superintendent, Technical Services,
from 1990 through July 1994, Echo
Bay Minerals, Kettle River Operations.

Officers of the Company are appointed by the Board of Directors.

PART II
-------

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
-------------------------------------------------
STOCKHOLDER MATTERS
-------------------

The common stock of the Company was approved for quotation on the NASDAQ
system and trading commenced on February 17, 1989 under the symbol CRRS. Since
August 1, 1989 the Company's common stock has been traded on the NASDAQ National
Market System. The Company's stock has been listed and traded in Canada on the
Toronto Stock Exchange since December 10, 1991, under the symbol CRO.

The following table sets forth the high and low sales prices on the NASDAQ
National Market System for the Company's common stock for the quarterly periods
from January 1, 1996 to December 31, 1997.

Prices (US$)
------------
High Low
---- ---

1996:
- -----
First Quarter $6.88 $4.75
Second Quarter 6.50 5.13
Third Quarter 7.00 5.00
Fourth Quarter 6.75 5.38

1997:
- -----
First Quarter 7.25 5.63
Second Quarter 7.38 5.88
Third Quarter 7.25 5.38
Fourth Quarter 6.50 3.44

Holders of common stock are entitled to receive such dividends as may be
declared by the Board of Directors. The Company has not paid any dividends on
its common stock and does not anticipate paying any dividends in the foreseeable
future.

At March 9, 1998, there were 1,170 record holders of the Company's common
stock.

ITEM 6. SELECTED FINANCIAL DATA
-----------------------

The selected consolidated financial data set forth below for each of the
five years in the period ended December 31, 1997 and as of the years then ended
has been derived from the audited consolidated financial statements of the
Company (not all of which financial statements are presented herein). The
selected consolidated financial data should be read in conjunction with
Management's Discussion and Analysis of Financial Condition and Results of
Operations and the audited consolidated financial statements and related notes
thereto included elsewhere in this report.

Balance sheet data: As of December 31,
(in thousands) ----------------------------------------------
1997 1996 1995 1994 1993
------ ------ ------ ------ ------

Total Assets $34,338 $37,113 $36,664 $39,441 $28,882

Long Term Debt 15,000 15,000 15,000 15,000 15,000

Working Capital 5,521 5,384 7,632 11,981 2,822

Stockholders' Equity 13,979 17,197 18,430 20,077 12,442

Income statement Years ended December 31,
data: (in thousands, ----------------------------------------
except per share 1997 1996 1995 1994 1993
amounts) ----------- -------- -------- ---------- --------

Revenues $ 685 $ 803 $ 1,030 $10,603(2) $ 2,407

Net Income (Loss) (4,979)(1) (1,571) (1,717) 3,505 (1,724)

Net Income (Loss)
per Share (0.38) (0.12) (0.13) 0.27 (0.14)

(1) The Company recorded a $3.8 million charge related to its decision to
withdraw from exploration in Argentina. The minority interest related to
this charge was approximately $1.6 million.

(2) Crown earned $8.5 million in 1994 from Battle Mountain.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------

The following discussion should be read in conjunction with the Company's
consolidated financial statements for the years ended December 31, 1997, 1996
and 1995, included elsewhere in this report. The Company's financial condition
and results of operations are not necessarily indicative of what may be expected
in future years. The Company's assets in South America are held through
Solitario Resources Corporation ("Solitario"), a 57.2%-owned subsidiary as of
December 31, 1997

Results of Operations
- ---------------------

The Company has historically derived its revenues from the option and sale
of property interests, from royalty interests and from the sale of its share of
gold produced on its properties. Revenues from the option and sale of property
interests have consisted of a small number of relatively large transactions.
Such transactions have occurred and in the future are likely to occur, if at
all, at irregular intervals and have a significant impact on operating results
in the periods in which they occur. The Company had no such large transactions
in 1997.

The Company had a net loss of $5.0 million ($0.38)per share) in 1997
compared with a net loss of $1.6 million ($0.12 per share) in 1996 and a net
loss of $1.7 million ($0.13 per share) in 1995. Included in the 1997 results
were non-cash property abandonments of $5.7 million, including $3.8 million
related to the Company's decision to withdraw from exploration in Argentina.

Total revenues were $0.7 million in 1997 compared with $0.8 million in 1996
and $1.0 million in 1995. The Company's recurring revenues have been primarily
derived from its royalty interests and from interest income. Royalty income was
$0.3 million in 1997, $0.2 million in 1996 and $0.5 million in 1995. Royalty
income has decreased due to the completion of mining at the Kendall mine in
Montana, in which the Company has a 5% royalty interest. The mine is now in
reclamation. The Company's remaining royalty interest relates to the Lamefoot
deposit at the Kettle River mine in Washington. The Lamefoot deposit represents
the primary ore source at Kettle River for the next three years. Approximately
$0.2 million is expected to be received from this royalty interest in 1998.

Interest income was $0.4 million in 1997 compared with $0.4 million in 1996
and $0.6 million in 1995. Fluctuations are due to changes in average interest
rates and the Company's average invested cash balances, which have been impacted
primarily by proceeds received from the sales of stock of the Company's
subsidiary, Solitario, and the level of exploration activity carried on by the
Company. See LIQUIDITY AND CAPITAL RESOURCES.

General and administrative expenses in 1997 were $2.0 million compared with
$1.7 million in 1996 and $2.0 million in 1995. The higher costs in 1997 are the
result of increased exploration activity, additional travel and promotional
expense and financing related activities. The lower expenses in 1996 are the
result of reduced legal and finance activities. One-time costs in 1995
associated with a merger proposal received and later rejected by the Company
increased general and administrative expenses.

Interest expense was $1.0 million in each of 1997, 1996 and 1995 and
related primarily to the Company's convertible debentures. Included in interest
expense is amortization of deferred offering costs of $0.1 million in each of
1997, 1996 and 1995.

The Company regularly performs evaluations of its assets to assess the
recoverability of its investments in these assets. Write downs relating to
exploration properties amounted to $5.7 million in 1997 and $0.5 million in each
of 1996 and 1995. Included in the write-down was the Company's decision to
withdraw from active exploration in Argentina resulting in a $3.8 million charge
to operations at December 31, 1997. In addition, the Company recorded $1.9
million of write-downs on certain of its properties in the U.S., Peru and
Argentina during 1997 as a result of factors including inadequate exploration or
drilling results, lower gold prices and focusing its efforts on its most
promising prospects.

Minority interest in loss of subsidiary increased to $2.1 million in 1997
from $0.4 million in 1996 and $0.3 million in 1995. This variance occurred as
the result of higher losses in Solitario due to asset write-downs mitigated by
lower minority share holdings of Solitario in 1997.

In March 1995, the Financial Accounting Standards Board ("FASB"') issued
Statement of Financial Standards ("SFAS") No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of."
SFAS No. 121 requires that long-lived assets be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount of an asset
may not be recoverable, and establishes guidelines for determining
recoverability based on future net cash flows from the use of the asset and for
the measurement of the impairment loss. The Company adopted SFAS No. 121 in
1996. The adoption of SFAS No. 121 did not have a material effect on the
Company's results of operations or financial position.

In October 1995, the FASB issued SFAS No. 123, "Accounting for Stock Based
Compensation." The Company adopted this standard in 1996 by electing to
continue to account for such compensation consistent with Accounting Principles
Board Opinion No. 25, "Accounting for Stock Issued to Employees" and disclosing
the pro forma effect on net income and earnings per share as if the new
accounting standard been applied. Had the Company accounted for its stock
options under SFAS No. 123, it would have recorded net losses of $6.1 million
($0.46 per share) in 1997 and $2.1 million ($0.16 per share) in each of 1996 and
1995.

In February 1997, the FASB issued SFAS No. 128, "Earnings Per Share." SFAS
No. 128 establishes standards for computing and presenting earnings per share.
The statement is effective for financial statements issued in periods ending
after December 15, 1997, including interim periods; early application was not
permitted. The Company adopted SFAS No. 128 during 1997. However, the adoption
of SFAS 128 has not required the restatement of any prior period earnings per
share.

In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
Income", and SFAS No. 131, "Disclosures about Segments of an Enterprise and
Related Information." SFAS No. 130 establishes standards for reporting and
display of comprehensive income and its components and SFAS No. 131 establishes
standards for reporting information about operating segments and related
disclosures about products and services, geographic areas and major customers.
The Statements are effective for fiscal years beginning after December 15, 1997.
These standards, when adopted by the Company, are not expected to have a
material impact on the Company's reported financial position, results of
operations and cash flows.

The year 2000 potentially poses unique challenges for many businesses in so
far as their computer systems and those of third parties attempt to properly
recognize the date change. The Company has made and will make certain
investments in its software systems and applications to help the Company make
the year 2000 transition.

The operational and financial impact to the Company has not been and is not
anticipated to be material to its financial position or results of operations.

Liquidity and Capital Resources
- -------------------------------

Due to the nature of the mining business, the acquisition, exploration and
development of mineral properties requires significant expenditures prior to the
commencement of production. The Company has in the past financed its activities
through the sale of gold, the sale of securities, joint venture arrangements
(including project financing) and the sale of interests in its properties. To
the extent necessary, the Company expects to continue to use similar financing
techniques.

The Company's exploration and development activities and funding
opportunities, as well as those of its joint venture partners, may be materially
affected by gold price levels and changes in those levels. The market price of
gold is determined in world markets and is affected by numerous factors which
are beyond the Company's control.

Net cash used in operating activities was $2.1 million in 1997 compared
with uses of $1.6 million in 1996 and $2.0 million in 1995.

Net cash used in investing activities in 1997 was $2.6 million, compared
with $3.3 million in 1996 and $2.7 million in 1995. Net cash provided by
investing activities during 1997 was $5.1 million and during 1996 was $2.7
million, primarily from the sale of common stock of Solitario. No such sales
occurred during 1995. Cash uses included mineral property additions of $3.3
million in 1997, $3.5 million in 1996 and $2.8 million in 1995. These amounts
included South American expenditures of $2.4 million in 1997, $2.7 million in
1996 and $2.6 million in 1995 through Solitario.

The Company has budgeted $2.1 million for exploration in 1998, $1.4 million
of which is planned for Latin America. The Company's acquisition and
exploration programs in 1997, 1996 and 1995 have primarily been devoted to
properties in South America. As such, total foreign assets, as reported in the
consolidated balance sheet as of December 31, 1997, amounted to $5.7 million.
The Company is exposed to risks normally associated with foreign investments,
including political, economic and social instabilities, as well as foreign
exchange controls and currency fluctuations. Foreign investments may also be
subject to laws and policies of the United States affecting foreign trade,
investment and taxation which could affect the conduct or profitability of
future operations.

In February 1997, Crown sold 1,500,000 of its shares of Solitario in a
market transaction, generating net proceeds of approximately $4.4 million.
Crown reinvested the proceeds into Solitario by acquiring, through private
placement, 1,500,000 new shares of Solitario plus 1,500,000 warrants exercisable
into shares of Solitario at Cdn$4.83 until February 27, 1999.

In August 1997, the Company elected to convert its $1,500,000 7.5%
convertible note into 1,254,180 shares of Solitario common stock. The
conversion was in accordance with the terms of the note dated August 25, 1995.
Upon completion of the conversion and, after giving effect to option exercises
during 1997, the Company held 9,633,585 shares of Solitario or 57.2% as of
December 31, 1997.

During 1997, $0.1 million was received from the exercise of stock options.
However, the Company does not anticipate significant exercises of stock options
in the foreseeable future.

In January 1996, the Company sold 1,570,000 of its shares in Solitario,
receiving net proceeds of $2.6 million from the transaction. The Company
reinvested these proceeds by acquiring, through a private placement into
Solitario, 1,570,000 new shares of Solitario plus 1,570,000 warrants,
exercisable into shares of Solitario at Cdn$2.66 per share until February 1,
1998. The warrants expired unexercised in February 1998. There were no
significant financing activities in 1995.

Cash and cash equivalents amounted to $5.9 million at December 31, 1997,
compared to $5.4 million as of December 31, 1996. These funds are generally
invested in short-term interest-bearing deposits and securities, pending
investment in current and future projects. Included in cash and cash
equivalents at December 31, 1997 was $3.9 million which was held in Solitario.
Working capital at December 31, 1997 was $5.6 million compared with $5.4 million
at the end of 1996.

A significant part of Crown's business involves the review of potential
property acquisitions and continuing review and analysis of properties in which
it has an interest, to determine the exploration and development potential of
the properties. In analyzing expected levels of expenditures for work
commitments and lease obligations, Crown considers the fact that its obligations
to make such payments fluctuate greatly depending on whether, among other
things, Crown makes a decision to sell a property interest, convey a property
interest to a joint venture, or allow its interest in a property to lapse by not
making the work commitment or payment required.

The Company estimates its 1998 work commitments remaining to be fulfilled
on its existing properties will be approximately $0.2 million. All of these
work commitments are expected to be fulfilled by the Company's joint venture
partners. The Company's share of rental obligations and other property payments
for 1998 is estimated to be $0.1 million.

In December 1996, Solitario signed an agreement with a subsidiary of
Cominco Ltd. ("Cominco") on the Bongara project. Cominco has the right to earn a
60% interest in the Bongara project by spending a minimum of $27.5 million on
exploration and development and by making cash payments of $1.8 million to
Solitario over a four-year period, as well as fully funding the project through
a bankable feasibility study. Cash payments of $250,000 and $300,000 have been
paid by Cominco in January 1997 and

January 1998, respectively. In addition to the cash payments and work
commitments, Cominco has agreed to finance Solitario's share of project
development costs, subject to repayment, after a production decision is made,
should Solitario not secure third-party financing.

The Company believes that its existing funds and projected sources of funds
will be sufficient to finance its currently planned exploration and other
operating activities, and mandatory debt repayments for the foreseeable future.
The Company's long-term funding opportunities and operating results are highly
dependent on the gold price as well as successful commencement of commercial
production at the Crown Jewel Project. Moreover, the Company believes that its
ability to raise capital in the future will be tied largely to successful
permitting and development of the Crown Jewel deposit. See PROPERTIES - CROWN
JEWEL PROJECT -PERMITTING AND DEVELOPMENT.

The FEIS on the Crown Jewel project was issued to the public in February
1997. In May of 1997, the USFS upheld the Record of Decision to approve the
Crown Jewel Project. In May 1997, an action was filed in U.S. District Court
against the USFS appealing its decision to uphold the ROD. This action is
currently pending. Most substantive permit applications necessary to begin
construction have been filed with the various local, state and federal agencies
and are undergoing review. As of February 1998, the Crown Jewel Project has
received favorable decisions on 40 of 64, or 63%, of the total permits necessary
on the Project. In September of 1997, an action was filed before the Control
Hearings Board, a state administrative tribunal challenging the FEIS and certain
permit decisions. Pending successful completion of the permit applications, and
the absence of a prolonged injunction, construction could begin in the Spring of
1999 and is forecast to take approximately 14 months to complete. There are no
assurances, however, that permits will be issued in a timely fashion or that
conditions contained in permits issued by the agencies will not be so onerous as
to preclude construction or operation of the project. See PROPERTIES - CROWN
JEWEL.

Uncertainties which exist with respect to timing of commercial production
at Crown Jewel, and the potential fluctuation in gold prices, could have a
material effect upon the Company's ability to fund its operating activities in
the long term. There is no assurance that such funding will or can be secured
on terms favorable to the Company.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
-------------------------------------------

CROWN RESOURCES CORPORATION

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Page
----

Independent Auditors' Report . . . . . . . . . . . . . . . . F-1

Consolidated Financial Statements:
Consolidated Balance Sheets as of December 31,
1997 and 1996 . . . . . . . . . . . . . . . . . . . . . F-2

Consolidated Statements of Operations for the years
ended December 31, 1997, 1996 and 1995 . . . . . . . . . F-3

Consolidated Statements of Stockholders' Equity for the
years ended December 31, 1997, 1996 and 1995 . . . . . . F-4

Consolidated Statements of Cash Flows for the years
ended December 31, 1997, 1996 and 1995 . . . . . . . . . F-5

Notes to Consolidated Financial Statements . . . . . . . . . F-6

All schedules are omitted as the required information is included in the
financial statements or notes thereto or is not applicable. Financial
information on 50% or less owned entities is omitted, as the entities do not
meet the tests for inclusion.

The Company is not required to provide the selected quarterly financial
data specified in Item 302 of Regulation S-K because it does not meet the tests
outlined in Item 302(a)(5).

INDEPENDENT AUDITORS' REPORT
----------------------------

To the Board of Directors and Stockholders
of Crown Resources Corporation
Denver, Colorado

We have audited the consolidated balance sheets of Crown Resources Corporation
and subsidiaries as of December 31, 1997 and 1996, and the related consolidated
statements of operations, stockholders' equity, and cash flows for each of the
three years in the period ended December 31, 1997. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Crown Resources Corporation and
subsidiaries as of December 31, 1997 and 1996, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 1997 in conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP

Denver, Colorado
March 9, 1998

F-1

CROWN RESOURCES CORPORATION

CONSOLIDATED BALANCE SHEETS

December 31,
------------
1997 1996
---- ----
(in thousands)
ASSETS

CURRENT ASSETS:
Cash and cash equivalents $ 5,857 $ 5,447
Short-term investments 86 89
Bullion inventories 96 106
Prepaid expenses and other 130 377
------- -------
TOTAL CURRENT ASSETS 6,169 6,019

MINERAL PROPERTIES, NET 27,590 30,229

OTHER ASSETS:
Debt issuance costs, net 375 477
Marketable equity securities 17 18
Other 187 370
------- -------
579 865
------- -------
$34,338 $37,113
======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

Accounts payable $ 359 $ 345
Other 289 290
-------- --------
TOTAL CURRENT LIABILITIES 648 635

LONG TERM LIABILITIES:
Convertible debentures 15,000 15,000
Deferred income taxes 731 1,140
-------- --------
15,731 16,140

MINORITY INTEREST IN CONSOLIDATED
SUBSIDIARY 3,980 3,141

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
Preferred stock, $0.01 par value;
authorized 20,000,000 shares;
none outstanding - -
Common stock, $0.01 par value;
authorized 50,000,000 shares;
issued and outstanding 13,312,829
and 13,211,484 shares 133 132
Additional paid-in capital 29,653 27,886
Accumulated deficit (15,792) (10,813)
Unrealized loss on marketable
equity securities (15) (8)
-------- --------
13,979 17,197
-------- --------

$34,338 $37,113
======== ========

See notes to consolidated financial statements.

F-2

CROWN RESOURCES CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per Years Ended December 31,
share amounts) -------------------------------
1997 1996 1995
--------- --------- ---------

REVENUES:
Royalty income $ 300 $ 245 $ 458
Interest income 385 407 572
Mineral property option
proceeds - 151 -
------- ------- -------
685 803 1,030
------- ------- -------

COSTS AND EXPENSES:
Depreciation, depletion and
amortization 180 174 264
General and administrative 1,985 1,676 1,999
Interest expense 1,020 971 971
Asset write-downs 5,743 476 494
Other, net 12 33 (50)
------- ------- -------
8,940 3,330 3,678
------- ------- -------
LOSS BEFORE INCOME
TAXES AND MINORITY INTEREST (8,255) (2,527) (2,648)

Income tax benefit (1,055) (580) (661)
------- ------- -------

LOSS BEFORE MINORITY INTEREST (7,200) (1,947) (1,987)

Minority interest in loss of subsidiary (2,221) (376) (270)
------- ------- -------

NET LOSS $(4,979) $(1,571) $(1,717)
======= ======= =======

BASIC AND DILUTED LOSS
PER COMMON SHARE $ (0.38) $ (0.12) $ (0.13)
======= ======= =======

WEIGHTED AVERAGE NUMBER OF
COMMON AND COMMON EQUIVALENT
SHARES OUTSTANDING 13,268 13,193 13,160
======= ======= =======

See notes to consolidated financial statements.

F-3

CROWN RESOURCES CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Unrealized
Gain (Loss)
on
(in thousands, except share Common Stock Additional Marketable
amounts) ------------------ Paid-in Accumulated Equity
Shares Amount Capital Deficit Securities Total
-------- ------ ---------- ------- ---------- ---------

BALANCE, JANUARY 1, 1995 13,155,784 $ 132 $ 27,475 $ (7,525) $ (5) $ 20,077

Issuance of shares
Exercise of stock options 15,875 - 74 - - 74
Net loss - - - (1,717) - (1,717)
Net unrealized loss on
marketable equity securities - - - - (4) (4)
---------- ------ ---------- -------- ---------- --------
BALANCE, DECEMBER 31, 1995 13,171,659 132 27,549 (9,242) (9) 18,430

Issuance of shares
Exercise of stock options 39,825 - 190 - - 190
Sale of shares of subsidiary,
net of tax of $924 - - 147 147
Net loss - - - (1,571) - (1,571)
Net unrealized loss on
marketable equity securities - - - - 1 1
---------- ------ ---------- -------- ---------- --------

BALANCE, DECEMBER 31, 1996 13,211,484 132 27,886 (10,813) (8) 17,197

Issuance of shares
Exercise of stock options 76,950 1 342 - - 343
For services 24,395 - 140 - - 140
Sale of shares of subsidiary,
net of tax of $724 - - 1,285 - - 1,285
Net loss - - - (4,979) - (4,979)
Net unrealized loss on
marketable equity securities - - - - (7) (7)
---------- ------ ---------- -------- ---------- --------

BALANCE, DECEMBER 31, 1997 13,312,829 $ 133 $ 29,653 $(15,792) $(15) $ 13,979
========== ====== ========== ======== ========== ========

See notes to consolidated financial statements.

F-4

CROWN RESOURCES CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended December 31,
----------------------------
(in thousands) 1997 1996 1995
-------- -------- --------

OPERATING ACTIVITIES:
Net loss $(4,979) $(1,571) $(1,717)
Adjustments:
Depreciation, depletion and amortization 282 276 366
Deferred income taxes (1,055) (580) (661)
Asset write-downs 5,743 476 494
Common stock issued for services 140 - -
Minority interest (2,221) (376) (270)
Changes in operating assets and liabilities:
Bullion inventories 10 (63) 64
Prepaid expenses and other (3) 209 (104)
Accounts payable and
other current liabilities 13 42 (168)
------- ------- -------
Net cash used in operating activities (2,070) (1,587) (1,996)
------- ------- -------

INVESTING ACTIVITIES:
Additions to mineral properties (3,313) (3,467) (2,837)
Receipts on mineral property transactions 655 101 125
Sale of short-term investments, net 3 46 14
Decrease (increase) in other assets 5 (8) 16
------- ------- -------
Net cash used in investing activities (2,650) (3,328) (2,682)
------- ------- -------

FINANCING ACTIVITIES:
Sale of common stock of subsidiary, net 4,862 2,610 -
Common stock issued under options
and warrants 268 129 48
------- ------- -------
Net cash provided by financing
activities 5,130 2,739 48
------- ------- -------

NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 410 (2,176) (4,630)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 5,447 7,623 12,253
------- ------- -------

CASH AND CASH EQUIVALENTS, END OF YEAR $ 5,857 $ 5,447 $ 7,623
======= ======= =======

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Non-cash transactions:
Securities received for mineral
property transactions $ 9 $ - $ 30
Deferred tax benefit of non-qualified
stock option exercises 75 61 26
Acquisition of additional interest in subsidiary 205 240 -
Cash paid for interest 868 868 868

See notes to consolidated financial statements.

F-5

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

1. Business and Summary of Significant Accounting Policies:
-------------------------------------------------------

Business
--------

Crown Resources Corporation (the "Company" or "Crown") engages principally
in the acquisition, exploration and development of mineral properties,
which presently exist in the western United States and in South America.
Its properties in Peru and Argentina are held through Solitario Resources
Corporation ("Solitario"), a 57.2%-owned subsidiary as of December 31,
1997.

Crown has historically derived its revenues from the option and sale of
property interests, from royalty interests and from the sale of its share
of gold produced from its properties.

Financial reporting
-------------------

The consolidated financial statements include the accounts of Crown and its
wholly- and majority-owned subsidiaries. All material intercompany
accounts and transactions have been eliminated in consolidation. Undivided
interests in mineral properties are accounted for by the proportionate
consolidation method in accordance with standard practice in the mining
industry.

Use of estimates
----------------

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.

Cash equivalents
----------------

Cash equivalents include investments in highly liquid debt securities with
maturities of three months or less when purchased. Investments with longer
maturities at the date of purchase are classified as short-term
investments.

F-6

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

1. Business and Summary of Significant Accounting Policies (Continued):
-------------------------------------------------------- -----------

Inventories
-----------

Gold bullion received as in-kind royalties is recorded at market.
Inventories of $ 96,000 and $106,000 at December 31, 1997 and 1996,
respectively, consisted entirely of gold bullion.

Mineral properties
------------------

Leasehold costs are capitalized in cost centers and are depleted on the
basis of the cost centers' economic reserves (estimated recoverable, proven
and probable reserves) using the units-of-production method. If there are
insufficient economic reserves to use as a basis for depleting such costs,
they are expensed as a mineral property write-off in the period in which
the determination is made. Economic reserves and related leasehold costs
attributable to properties under option to be acquired by third-parties are
not included in the depletion calculation.

Exploration costs are capitalized initially and are charged to operations
if an area is abandoned or deemed impaired. Exploration costs on successful
projects will be amortized by the units-of-production method based on
estimated economic reserves.

The Company records the proceeds from the sale of property interests to
joint ventures as a reduction of the related property's capitalized cost.

Marketable equity securities
----------------------------

The Company has adopted Statement of Financial Accounting Standards
("SFAS") No. 115, "Accounting for Certain Investments in Debt and Equity
Securities." The Company's equity securities are classified as available-
for-sale. The cost of marketable equity securities sold is determined by
the specific identification method.

Foreign exchange
----------------

The United States dollar is the functional currency for all the Company's
foreign subsidiaries. Foreign currency gains and losses are included in
the results of operations in the periods in which they occur.

F-7

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

1. Business and Summary of Significant Accounting Policies (Continued):
-------------------------------------------------------------------

Revenue recognition
-------------------

Royalty revenue is recognized when product is delivered in-kind or cash
payments are received.

Income taxes
------------

The Company reports income taxes pursuant to Statement of Financial
Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes."
Under SFAS No. 109, income taxes are provided for the tax effects of
transactions reported in the financial statements and consist of taxes
currently due plus deferred taxes related to certain income and expenses
recognized in different periods for financial and income tax reporting
purposes. Deferred tax assets and liabilities represent the future tax
return consequences of those differences, which will either be taxable or
deductible when the assets and liabilities are recovered or settled.
Deferred taxes also are recognized for operating losses and tax credits
that are available to offset future taxable income and income taxes,
respectively. A valuation allowance is provided if it is more likely than
not that some portion or all of the deferred tax assets will not be
realized.

Loss per share
--------------

In February 1997, the Financial Accounting Standards Board ("FASB") issued
SFAS No. 128, "Earnings Per Share." SFAS No. 128 establishes standards for
computing and presenting earnings per share. The Company has adopted SFAS
No. 128 during 1997. There has been no change in prior period earnings per
share data as a result of adopting SFAS No. 128.

The calculation of basic and diluted loss per share is based on the
weighted average number of common shares outstanding during the years ended
December 31, 1997, 1996 and 1995. The effect of common stock equivalents
which include stock options, warrants and convertible debt securities is
not included in the computation of diluted per share amounts in 1997, 1996
and 1995 because its inclusion would be anti-dilutive.

Employee stock compensation plans
---------------------------------

The Company follows Accounting Principles Board Opinion ("APBO") No. 25,
"Accounting for Stock Issued to Employees." Under the terms of the
Company's stock option plans, the

F-8

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

1. Business and Summary of Significant Accounting Policies (Continued):
-------------------------------------------------------------------

exercise price of stock options issued to employees equals the market price
of the stock on the measurement date and, therefore, the Company does not
record compensation expense on stock options granted to employees.

Minority interest
-----------------

Minority interest represents the minority stockholders' proportionate
interest in Solitario. The Company owned 57.2% and 60.4% of Solitario at
December 31, 1997 and 1996, respectively.

New accounting pronouncements
-----------------------------

In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
Income," and SFAS No. 131, "Disclosures about Segments of an Enterprise and
Related Information." SFAS No. 130 establishes standards for reporting and
display of comprehensive income and its components and SFAS No. 131
establishes standards for reporting information about operating segments
and related disclosures about products and services, geographic areas and
major customers. The SFAS's are effective for fiscal years beginning after
December 15, 1997. These standards, when adopted by the Company, are not
expected to have a material impact on the Company's reported financial
position, results of operations and cash flows.

2. Mineral Properties:
------------------

United States
-------------

Crown Jewel Project

In March 1990, the Company entered into an agreement with Battle Mountain
Gold Company ("Battle Mountain") providing Battle Mountain an option to
enter into a joint venture to develop the Company's Crown Jewel gold
deposit in northeastern Washington. Battle Mountain paid $5,000,000 on the
grant of the option and since March 14, 1990 has funded all exploration on
Crown Jewel. On January 4, 1991, Battle Mountain exercised its option by
payment of an additional $5,000,000. In order to acquire a 51% interest in
the project, Battle Mountain is required to fund all development and
capital costs to com-mencement of commercial production. Crown is not
required to fund or repay any costs related to the development and capital
costs of the project incurred prior to commercial production.

F-9

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

2. Mineral Properties (Continued):
------------------------------

In May 1994, Crown and Battle Mountain reached an agreement resolving
certain contractual issues related to the Crown Jewel Venture Agreement,
which had been the subject of arbitration proceedings. Under the terms of
the agreement, Battle Mountain paid to Crown $4,250,000 in cash plus
435,897 shares of Battle Mountain common stock (market value $4,250,000) in
exchange for (1) the right to earn an additional 3% (to 54%) in the first
1,600,000 ounces of gold recovered from the Crown Jewel property and (2)
release of Battle Mountain from its obligation to make any of the quarterly
$1,000,000 payments to Crown which might otherwise have become due because
of startup delays on the project.

Cord Ranch

The Company holds a lease for the right to explore and develop the Cord
Ranch prospect, a 34,000 acre ranch in the southern portion of the Carlin
Gold Trend of Nevada. By amendment, the lease required a work commitment
of $900,000 which has been fulfilled as of December 31, 1997. In addition,
the agreement calls for non-recoupable minimum annual payments of $150,000
in each of 1998 and 1999 and recoupable annual advance royalty payments of
$200,000 in 2000 and thereafter.

In September 1994, Crown signed an agreement which has been assigned to a
subsidiary of Royal Standard Minerals Inc. ("Royal Standard"). Royal
Standard has the right to earn a 70% interest in Crown's Cord Ranch and
adjacent gold properties. In order to vest in any of the Crown properties,
Royal Standard must fulfill the terms of the Cord lease agreement, as
amended, including the work commitment and property payments as specified.
Royal Standard has reported it has completed its work commitment as of
December 31, 1997. In addition, should Royal Standard vest in the
properties, it must provide Crown's share of expenditures through the
completion of a favorable feasibility study, with such expenditures to be
repaid from Crown's share of production from the properties.

Peru
----

The Company holds exploration concessions or has filed applications for
concessions covering approximately 355,000 acres in Peru. These
applications are subject to normal administrative approvals and the
properties are subject to an annual rental of $2.00 per hectare
(approximately 2.47 acres per hectare) in June of each year.

F-10

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

2. Mineral Properties (Continued):
------------------------------

In November 1993, the Company entered into option agreements for the
Bongara claims #1-10 covering a 25,000-acre zinc prospect in northern Peru.
During 1997, the Company relinquished its option rights under the
agreement. Since 1993, the Company has acquired approximately 215,000
additional acres ("the Bongara project") by staking concessions.

In December 1996, Solitario signed an agreement with a subsidiary of
Cominco Ltd. ("Cominco") regarding the Bongara project, presently covering
approximately 215,000 acres. Cominco has the right to earn up to a 60%
interest in the Bongara project by spending a minimum of $27,500,000 on
exploration and development and by making cash payments of $1,800,000 to
Solitario over a four-year period, as well as fully funding the project
through a bankable feasibility study. Cash payments of $250,000 and
$300,000 have been paid by Cominco in January 1997 and January 1998,
respectively. In addition to the cash payments and work commitments,
Cominco has agreed to finance Solitario's share of project development
costs, subject to repayment, after a production decision is made, should
Solitario not secure third-party financing. Through December 31, 1997,
Cominco has spent approximately $4.9 million on exploration of the Bongara
project.

Argentina
---------

Through December 31, 1997, the Company held exploration rights or had filed
applications for rights covering approximately 650,000 acres primarily in
six provinces of Argentina. Such exploration rights are granted by the
provincial governments, which have the right to impose up to a maximum 3%
gross royalty on production. Solitario made the decision to withdraw from
exploration in Argentina to concentrate its attention and financial
resources in Peru. Additionally, the current precious metals markets
highlighted the need to focus exploration efforts on the best areas of
mineral potential. As a result of this decision, the Company recorded a
write-down of $3.8 million in December 1997. In early March 1998, the
Company signed a letter of intent with Toscana Resources, Ltd. ("Toscana")
of Vancouver, B.C., to sell all of the issued and outstanding shares of
Solitario's Argentina subsidiary. The purchase price of Cdn$500,000 would
be received in shares of Toscana. The transaction is subject to due
diligence, Board of Directors and regulatory approval. Solitario also
received a non-refundable binder payment of Cdn$65,000 upon signing the
letter of intent.

F-11

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

2. Mineral Properties (Continued):
------------------------------

Mexico
------

During 1997, the Company, primarily through subcontractors, conducted
exploration and reconnaissance activities in Mexico, focusing its efforts
in the state of Durango. As a result of these activities the Company spent
approximately $0.1 million and acquired the La Pitarrilla concession
covering approximately 14,000 acres.

Asset write-downs
-----------------

In accordance with SFAS No,. 121, "Accounting For Impairment of Long-Lived
Assets and For Long-Lived Assets to be Disposed Of," the Company regularly
performs evaluations of its assets to assess the recoverability of its
investments in these assets. Upon determining that certain properties did
not have sufficient potential for economic mineralization and related

to the Company's decision to withdraw from exploration in Argentina, the
Company recorded write-downs relating to exploration properties of
$5,743,000, $476,000 and $494,000 in 1997, 1996 and 1995, respectively.

Mineral property costs for all the Company's properties are comprised of
the following:

December 31,
------------------
1997 1996
-------- --------

(in thousands)
Land and leasehold costs $14,761 $15,293
Exploration costs 13,653 15,760
------- -------
28,414 31,053
Less accumulated depreciation,
depletion and amortization 824 824
------- -------
$27,590 $30,229
======= =======

Land, leasehold and exploration costs related to mineral properties for
which exploration activities had not yet identified the presence of
economic reserves totaled $14,133,000 and $16,736,000 at December 31, 1997
and 1996, respectively.

At December 31, 1997 and 1996, the carrying value of the Crown Jewel
Project amounted to $13,457,000 and $13,493,000 respectively. The Crown
Jewel Project represents the Company's total proven and probable gold
reserves and its only property in development.

F-12

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

2. Mineral Properties (Continued):
------------------------------

The net assets of the Company's foreign operations located in Peru and
Argentina and included in the consolidated balance sheet are $5,603,000 at
December 31, 1997 and $8,102,000 at December 31, 1996.

3. Convertible Debentures:
----------------------

On August 27, 1991 the Company completed a European offering for $15
million of 5 3/4% Convertible Subordinated Debentures due 2001
("Debentures"). The Debentures are convertible into approximately
1,523,000 shares of Crown common stock at $9.85 per share, and are
redeemable at the option of the Company on certain terms and conditions.
Interest on the Debentures is payable semiannually in arrears, each
February and August. Neither the Debentures nor the common stock issuable
upon conversion of the Debentures is registered under the Securities Act of
1933. Debt offering costs are being amortized over the life of the
Debentures.

4. Income Taxes:
-------------

The Company's income tax expense (benefit) from continuing operations
consists of the following:

(in thousands) 1997 1996 1995
------- ------- -----

Deferred: $ 84 $ 336 $ 213
U.S.
Foreign 32 46 54
Operating loss and credit
carryovers:
U.S. (997) (900) (899)
Foreign (174) (62) (29)
------- ----- -----
Income tax benefit $(1,055) $(580) $(661)
======= ===== =====

Consolidated loss before income taxes includes losses from foreign
operations of $5,232,000, $618,000, and $486,000 in 1997, 1996 and 1995,
respectively.

Deferred income taxes result from temporary differences in the timing of
income and expenses for financial and income tax reporting purposes. The
primary components of deferred income taxes result from exploration and
development costs, depreciation, depletion and amortization expenses, and
property abandonments.

F-13

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

4. Income Taxes (Continued):
------------------------

During 1997, 1996 and 1995 the Company recognized income tax deductions of
$643,000, $180,000, and $77,000, respectively, from the exercise of non-
qualified stock options. Stockholders' equity has been credited in the
amounts of $75,000, $61,000, and $26,000, respectively, for the income tax
benefits of these income tax deductions net of valuation allowances. Also
during 1997 and 1996, the Company purchased and sold shares of Solitario.
Stockholders' equity has been charged in the amounts of $724,000 and
$924,000, respectively, for the income tax expense associated with the
purchase and sale transactions including $14,000 and $560,000,
respectively, relating to previously unrecognized temporary differences
associated with the Company's investment in Solitario.

The net deferred tax liabilities in the accompanying December 31, 1997 and
1996 balance sheets include the following components:

(in thousands) 1997 1996
------- -------

Deferred tax assets:

Net operating loss (NOL)
carryovers $ 8,797 $ 6,391
Alternative minimum tax (AMT)
credit carryovers 325 325
Investment in Argentina
subsidiary 1,930 0
Other 125 108
Valuation allowance (4,938) (1,049)
Deferred tax assets 6,239 5,775
------- -------

Deferred tax liabilities:

Exploration and development
costs 6,435 6,420
Depreciation, depletion and
amortization 497 448
Other 38 47
------- -------
Deferred tax liabilities 6,970 6,915
------- -------

Net deferred tax liabilities $ 731 $ 1,140
======= =======

The Company has recognized a deferred tax asset relating to its investment
in its Argentina subsidiary as it anticipates disposing of the investment
in 1998. A full valuation allowance has been provided against the deferred
tax asset.

F-14

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

4. Income Taxes (Continued):
------------------------

A reconciliation of expected federal income taxes on income from continuing
operations at statutory rates with the benefit for income taxes is as
follows:

(in thousands) 1997 1996 1995
------- ------ ------

Income tax at statutory
rates $(2,807) $(859) $(900)
Nondeductible foreign
expenditures 85 67 75
Disposition of investment
in Argentina (1,683) - -
Excess percentage depletion - - (20)
Foreign mining incentives (201) (202) (324)
State income tax (267) (18) (11)
Change in valuation allowance 3,747 443 523
Other 71 (11) (4)
------- ----- -----
Income tax benefit $(1,055) $(580) $(661)
======= ===== =====

At December 31, 1997, the Company has unused U.S. NOL carryovers of
approximately $17,568,000 which begin to expire in 2004. In addition, the
Company has approximately $325,000 of U.S. AMT credit carryovers which can
be carried forward indefinitely. The Company also has Argentina and Peru
NOL carryovers at December 31, 1997 of approximately $7,420,000 and
$920,000, respectively, which begin to expire in 1999 and 2000,
respectively. A full valuation allowance has been provided against the
income tax benefit of the Argentina and Peru NOL carryovers. The
anticipated 1998 disposition of the Company's investment in Argentina will
result in (1) the elimination of the Argentina NOL carryovers and attendant
valuation allowance, and (2) the creation of a U.S. capital loss carryover
of approximately $4,650,000 upon which a full valuation allowance will be
provided.

5. Fair Value of Financial Instruments:
-----------------------------------

SFAS No. 107, "Disclosures about Fair Value of Financial Instruments,"
requires the determination of fair value for certain of the Company's
financial assets and liabilities. It defines the fair value of a financial
instrument as the amount at which the instrument could be exchanged in a
current transaction between willing parties, other than in a forced or
liquidation sale.

For certain of the Company's financial instruments, including cash and cash
equivalents, short-term investments, accounts payable and other accrued
liabilities, the carrying amounts approximate fair value due to their short
maturities. The Company's marketable equity securities are carried at
their

F-15

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

5. Fair Value of Financial Instruments (Continued):
-----------------------------------------------

estimated fair value, based on quoted market prices. At December 31, 1997
and 1996 the estimated fair value of the Company's Debentures was
$12,750,000, based on quoted market prices.

6. Commitments and Contingencies:
-----------------------------

In acquiring its interests in minerals claims and leases, the Company has
entered into lease agreements which generally may be canceled at its
option. The Company is required to make work commitments and minimum
rental payments in order to maintain its interests in certain claims and
leases. The Company estimates its 1998 mineral property rentals and option
payments to be approximately $695,000. Based upon existing joint venture
or leasing arrangements, the Company's share of these costs is
approximately $30,000.

The Company has a defined-contribution retirement plan covering all full-
time U.S. employees. The plan provides for

Company matching, at the rate of 75%, of employee savings contributions of
up to 9% of compensation, subject to ERISA limitations. The cost of
Company contributions in 1997, 1996 and 1995 was $52,000, $48,000 and
$49,000, respectively.

The Company leases office space under non-cancelable operating leases
providing for minimum annual rent payments as follows: $75,000 in 1998,
$77,000 in 1999, $78,000 in 2000, and $39,000 in 2001. Rent expense for
all leases was $66,000, $60,000 and $122,000 for the years ended December
31, 1997, 1996 and 1995, respectively.

7. Stock Option Plans
------------------

Under the Company's 1988 Stock Benefit Plan ("1988 Plan"), the Board of
Directors may (a) grant incentive stock options, as defined in Section 422A
of the Internal Revenue Code of 1986, as amended, to any employee of the
Company or to any employee of any parent or subsidiary of the Company; (b)
grant options other than incentive stock options (non-qualified stock
options); (c) grant stock appreciation rights or cash bonus rights; (d)
award stock bonuses; and (e) grant stock purchase rights and sell stock
subject to certain restrictions.

Up to 1,500,000 shares of the Company's common stock may be issued under
the 1988 Plan. As of December 31, 1997, 576,476 shares remained available
for future issuance under the 1988 Plan. All stock options that have been
granted under the 1988 Plan have been issued at the market price of the
common stock at the date of the grant.

F-16

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

7. Stock Option Plans (Continued):
------------------------------

On June 27, 1991, the Company's shareholders approved the Crown Resources
Corporation 1991 Stock Incentive Plan ("1991 Plan"). The Board of
Directors has reserved 1,500,000 shares of Crown common stock for grants
under the 1991 Plan.

Generally, the terms and conditions of the 1991 Plan are similar to those
of the 1988 Plan described above, except that members of the Board of
Directors are eligible only to receive formula grants of non-qualified
stock options. Each member of the Board of Directors who is also an
employee of Crown or any parent or subsidiary of Crown will be entitled to
receive, automatically, an award of non-qualified stock options on grant
dates defined in the 1991 Plan. Each option will cover a number of shares
determined by dividing the employee-director's annual base compensation
rate on the grant date by three. Each director who is not an employee will
receive an award of non-qualified stock options covering 10,000 shares of
Crown common stock.

Options granted under the 1991 Plan are granted at the market price of the
common stock at the date of grant, except for non-qualified options granted
to non-directors, which price cannot be less than the average price for the
five business days immediately preceding the date of grant.

As of December 31, 1997, shares available for issue, including those
already granted, totalled 1,313,724 shares.

The activity in the 1988 Plan for the three years ended December 31, 1997
is as follows:

1997 1996 1995
---------------- ------- --------
Weighted Weighted Weighted
Average Average Average
Amount Price Amount Price Amount Price
---------------- ---------------- -----------------
Outstanding,
beginning
of year 60,000 5.63 280,600 9.25 607,017 8.20
Granted 546,395 5.75 60,000 5.63 -
Exercised (30,145) 5.74 - -
Expired - (280,600) 9.25 (326,417) 7.31
-------
Outstanding,
end of year 576,250 5.74 60,000 5.63 280,600 9.25
======= =======
Exercisable,
end of year 342,250 5.74 15,000 5.63 280,600 9.25
======= =======

The options outstanding under the 1988 Plan have an exercise price of $5.74
and weighted average remaining contractual life of 3.8 years.

F-17

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

7. Stock Option Plans (Continued):
-------------------------------

The activity in the 1991 Plan for the three years ended December 31, 1997
is as follows:

(in thousands) 1997 1996 1995
---------- ---------------- --------------
Weighted Weighted Weighted
Average Average Average
Amount Price Amount Price Amount Price
--------------------- ---------------- --------------

Outstanding,
beginning
of year 1,347,298 5.32 1,145,548 5.17 859,748 5.63
Granted 50,000 5.73 241,575 5.70 301,675 3.75
Exercised (71,200) 3.29 (39,825) 3.24 (15,875) 3.02
Forfeited - - -
Expired (299,666) 7.06 - -
-------- --------- ---------
Outstanding,
end of year 1,026,432 4.97 1,347,298 5.32 1,145,548 5.17
Exercisable, ========= ========= =========
end of year 935,432 6.46 1,202,048 5.36 947,473 5.35
========= ========= =========

Range of Weighted Average Weighted
Exercise Amount Remaining Average
Prices Outstanding Contractual Life Exercise Price
- -------- ----------- ---------------- --------------

$2.99-4.63 457,691 1.4 $ 3.59
$5.63-6.56 568,741 1.9 $ 6.10

Options granted under both plans generally expire five years from the date
of grant.

In October 1995, the FASB issued SFAS No. 123, "Accounting for Stock Based
Compensation." The Company elected to continue to account for such
compensation consistent with Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" and to disclose the pro forma
effect on net income and earnings per share as if the new accounting
standard been applied.

Pro forma information has been computed as if the Company had accounted for
its stock options under the fair value method of SFAS No. 123. The fair
values of these options were estimated at the date of grant using a Black-
Scholes option pricing model with the following assumptions for 1997, 1996
and 1995, respectively: risk-free interest rates of 6.37%, 5.69% and 7.06%;
dividend yields of 0%; volatility factors of the expected market price of
the Company's common stock of 52%, 53% and 55%; and a weighted average
expected life of the options of 4 years. The weighted average fair values
of the options granted are estimated at $2.49, $2.71 and $1.92 per share in
1997, 1996 and 1995, respectively.

F-18

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

7. Stock Option Plans (Continued):
------------------------------

Had the Company accounted for its stock options under the fair value method
of SFAS No. 123, the following results would have been reported:

(In thousands, except
per share amounts) 1997 1996 1995
-------- -------- --------

Net loss
As reported $(4,979) $(1,571) $(1,717)
Pro forma (6,136) (2,161) (2,125)

Basic and diluted
loss per share
As reported $ (0.38) $ (0.12) (0.13)
Pro forma (0.46) (0.16) (0.16)

8. Stockholders' Equity:
--------------------

Crown is authorized to issue 20,000,000 shares of $0.01 par value preferred
stock and has issued, to a subsidiary, 1,000,000 shares of nonconvertible
preferred stock which is eliminated in consolidation.

On July 25, 1995, the Company adopted a shareholder rights plan pursuant to
which rights ("Rights") to acquire shares of Series B Preferred Stock were
distributed to shareholders of the Company, with the right to buy 1/100
share of Series B Preferred Stock for each common share held, at an initial
exercise price of $25.00. The Company also designated 500,000 shares of
preferred stock as Series B Preferred Stock with each 1/100 share having
economic terms substantially equivalent to one common share.

Generally, the Rights will become exercisable if a shareholder or group of
shareholders becomes the beneficial owner of or announces the intention to
acquire common shares of 15 percent or more of the outstanding common
shares of the Company. If the Rights become exercisable, each Right (other
than Rights held by the acquiring person or group) will entitle the holder
to purchase, at the exercise price, common stock having a market value
equal to twice the exercise price.

In January 1996, the Company sold 1,570,000 of its shares in Solitario,
receiving net proceeds of $2,566,000 from the market transaction. The
Company reinvested the proceeds by acquiring, through a private placement
into Solitario, 1,570,000 new shares of Solitario plus 1,570,000 warrants,
exercisable into shares of Solitario at Cdn$2.66 per share which expired
unexercised in February 1998.

F-19

CROWN RESOURCES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995

8. Stockholders' Equity (Continued):
--------------------------------

During 1996, previously issued warrants to purchase 553,686 Solitario
shares at Cdn$2.50 (approximately $1.82) per share were exercised,
including 529,000 warrants exercised by the Company. Net proceeds to
Solitario from third party exercises were approximately $44,000.

In February 1997, the Company sold 1,500,000 of its shares in Solitario,
receiving net proceeds of $4,448,000 from the market transaction. The
Company reinvested the proceeds by acquiring, through a private placement
into Solitario, 1,500,000 new shares of Solitario plus 1,500,000 warrants,
exercisable into shares of Solitario at Cdn$4.83 per share until February
27, 1999.

In August 1997, the Company elected to convert its $1.5 million, 7.5%
convertible note into 1,254,180 shares of Solitario common stock. The
conversion was in accordance with the terms of the note dated August 25,
1995. Upon completion of the conversion and, along with options exercises
during 1997, the Company held 9,633,585 shares of Solitario stock or 57.2%
as of December 31, 1997.

9. Subsequent Event:
----------------

In February 1998, the Company received $4.6 million, after commissions and
offering expenses, from a European equity financing through the private
placement of 1.04 million shares of the Company's common stock. Included
in the placement was an agency fee of 40,000 shares paid to David
Williamson Associates, Ltd., of which David R. Williamson, a director of
the Company, is a principal.

F-20

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
------------------------------------------------
ACCOUNTING AND FINANCIAL DISCLOSURE
-----------------------------------

Not Applicable.

PART III
--------

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
--------------------------------------------------

(a) Directors.

The information with respect to directors required under this item is
incorporated herein by reference to the table set forth under the section
captioned ELECTION OF DIRECTORS in the Company's Proxy Statement in connection
with the annual meeting of shareholders to be held on June 18, 1998 filed with
the Securities and Exchange Commission pursuant to Section 14(a) of the
Securities Exchange Act of 1934.

(b) Executive Officers.

The information with respect to executive officers required under this item
is incorporated herein by reference to Part I of this Report.

ITEM 11. EXECUTIVE COMPENSATION
----------------------

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
---------------------------------------------------
MANAGEMENT
----------

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
----------------------------------------------

The information required under Item 11, Item 12 and Item 13 is incorporated
herein by reference to the sections entitled EXECUTIVE COMPENSATION, SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT and EXECUTIVE
COMPENSATION, respectively, in the Company's Proxy Statement in connection with
the annual meeting of shareholders to be held June 18, 1998, filed with the
Securities and Exchange Commission pursuant to Section 14(a) of the Securities
Exchange Act of 1934.

PART IV
-------

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
------------------------------------------------------
FORM 8-K
--------

(a) 1. Consolidated Financial Statements: Index on page 37 of
this Report.

2. Exhibits. The exhibits as indexed on pages 44 through 47 of this Report
are included as a part of this Form 10-K.

(b) Reports on Form 8-K:

A current report on Form 8-K was filed, dated February 27, 1998, which
reported European equity financing through the private placement of 1.04 million
shares of the Company's common stock.

Exhibit
Number Description
- ------- -----------

3.1 The Company's Articles of Incorporation (incorporated by reference to
Exhibit 3.1 to Registration Statement on Form S-4, Commission File No.
33-25033 (the "1989 S-4 Registration Statement")).

3.2 The Company's Bylaws (incorporated by reference to Exhibit 3.2 to the
1989 S-4 Registration Statement).

3.3 Statement of Rights and Preferences of Series A Nonconvertible Preferred
Stock (issued to a subsidiary) as filed with the Secretary of State,
State of Washington, which forms part of the Company's Articles of
Incorporation (incorporated by reference to Exhibit 3.3 to the Company's
Form 10-K for the year ended December 31, 1989).

4.1 Form of Rights Agreement, dated as of July 25, 1995, between the Company
and American Stock Transfer & Trust Company (incorporated by reference
to Exhibit 4.1 to the Company's Form 8-K dated July 25, 1995).

10.1 1988 Stock Benefit Plan of the Company (incorporated by reference to
Exhibit 10.11 to Amendment No. 2 to the Registration Statement).

10.2 1991 Stock Incentive Plan of the Company (incorporated by reference to
Exhibit 10.13 to Crown Resources Corporation's Registration Statement on
Form S-4 dated May 17, 1991, Commission file no. 33-40642 (the "1991 S-4
Registration Statement").

10.3 Crown Jewel Venture Agreement, dated effective January 4, 1991, between
Crown Resources Corporation, Crown Resource Corp. of Colorado, Gold
Texas Resources U.S., Inc., and Battle Mountain Gold Company
(incorporated by reference to Exhibit 10.10 to the 1991 S-4 Registration
Statement).

10.4 Agreement and Plan of Merger, dated April 16, 1991, between Crown
Resources Corporation, Crown Resources Property Corporation and Judith
Gold Corporation (incorporated by reference to Exhibit 2.1 to Crown
Resources Corporation's Form 8-K dated April 16, 1991).

10.5 Mining Lease, dated September 1, 1987, between Judith Gold Corporation
and Canyon Resources Corporation (incorporated by reference to Exhibit
10.14 to the 1991 S-4 Registration Statement).

10.6 Settlement Agreement, dated September 29, 1992, between Battle Mountain
Gold Company, Crown Resource Corp. of Colorado, Keystone Surveys, Inc.,
and Spenst M. Hansen (incorporated by reference to Exhibit 10.18 to Crown
Resources Corporation's Form 10-K for the year ended December 31, 1992).

10.7 Mutual General Release and Settlement Agreement, dated September 29,
1992, between Crown Resources Corporation and its subsidiary, Crown
Resource Corp. of Colorado, Centurion Mines Corp., and Royal Minerals,
Inc. (incorporated by reference to Exhibit 10.19 to Crown Resources
Corporation's Form 10-K for the year ended December 31, 1992).

10.8 First Amendment to Mining Agreement, dated October 25, 1993, between
Crown Resource Corp. of Colorado and United States National Bank of
Oregon, as Trustee for William Cord Pereira, Virginia Lee Pereira, Philip
Kirk Pereira, Patrick Clay Pereira and Susan Michele Pereira
(incorporated by reference to Exhibit 10.20 to Crown Resources
Corporation's Form 10-K for the year ended December 31, 1993).

10.9 Option Contract for Conveyance between Crown Resource Corp. of Colorado
and Compania Minera del Amazonas S.A. (Bongara-Even) (incorporated by
reference to Exhibit 10.21 to Crown Resources Corporation's Form 10-K for
the year ended December 31, 1993).

10.10 Agreement dated as of May 17, 1993, between Sovereign Gold Company
(Argentine), Ltd. and Crown Resources Corporation (incorporated by
reference to Exhibit 10.23 to Crown Resources Corporation's Form 10-K for
the year ended December 31, 1993).

10.11 Second Amendment to Mining Agreement, dated April 28, 1994, between Crown
Resource Corp. of Colorado and United States National Bank of Oregon, as
Trustee for William Cord Pereira, Virginia Lee Pereira, Philip Kirk
Pereira, Patrick Clay Pereira and Susan Michele Pereira (incorporated by
reference to Exhibit 10.1 to Crown Resources Corporation's Form 10-Q for
the quarter ended March 31, 1994).

10.12 Settlement Agreement, dated May 6, 1994, between Crown Resources
Corporation, Crown Resource Corp. of Colorado, Gold Texas Resources U.S.,
Inc. and Battle Mountain Gold Company (incorporated by reference to
Exhibit 10.2 to Crown Resources Corporation's Form 10-Q for the quarter
ended March 31, 1994).

10.13 Second Amendment to Crown Jewel Venture Agreement, dated April 27, 1994,
between Crown Resources Corporation, Crown Resource Corp. of Colorado,
Gold Texas Resources U.S., Inc. and Battle Mountain Gold Company
(incorporated by reference to Exhibit 10.1 to Crown Resources
Corporation's Form 10-Q for the quarter ended June 30, 1994).

10.14 Agreement, dated September 8, 1994, between Crown Resource Corp. of
Colorado and Pinon Exploration Corporation (incorporated by reference to
Exhibit 10.1 to Crown Resources Corporation's Form 10-Q for the quarter
ended September 30, 1994).

10.15 Stock Purchase Agreement, dated September 9, 1994, between Cyprus Gold
Exploration Corporation and Crown Resource Corp. of Colorado, relating to
the Shares of Capital Stock of Pinon Exploration Corporation
(incorporated by reference to Exhibit 10.2 to Crown Resources
Corporation's Form 10-Q for the quarter ended September 30, 1994).

10.16 First Amendment to Agreement between Crown Resource Corp. of Colorado and
Pinon Exploration Corporation (incorporated by reference to Exhibit 10.18
to Crown Resources Corporation's Form 10-K for the year ended December
31, 1995).

10.17 Third Amendment to Mining Agreement between United States National Bank
of Oregon, as Trustee for William Cord Pereira, Virginia Lee Pereira,
Philip Kirk Pereira, Patrick Clay Pereira and Susan Michael Pereira, as
Beneficiaries of the Pereira Children's Trust and Crown Resource Corp. of
Colorado (incorporated by reference to Exhibit 10.19 to Crown Resources
Corporation's Form 10-K for the year ended December 31, 1995).

10.18 Letter Agreement, dated December 24, 1996, between Cominco Peru s.r.l.
and Mineral Los Tapados S.A. (incorporated by reference to Exhibit 10.18
to Crown Resources Corporation's Form 10K for the year ended December 31,
1996).

10.19 Subscription Agreement and Warrant, dated February 27, 1997, between
Crown Resource Corp. of Colorado and Solitario Resources Corporation
subscribing for 1,500,000 units (a unit consisting of one share of common
stock and one share purchase warrant) of Solitario Resources Corporation
common stock.

10.20 Stock Purchase Agreement, dated February 23, 1998, between Crown
Resources Corporation and The Equitable Life Assurance Society
(incorporated by reference to Exhibit 10.1 to Crown Resources
Corporation's Form 8-K, dated February 27, 1998).

11 Statement regarding computation of per share earnings.

22 Subsidiaries of the registrant.

24.1 Consent of Deloitte & Touche LLP.

25 Powers of attorney.

27 Financial data schedule.

For the purpose of complying with the amendments to the rules governing
Form S-8 (effective July 13, 1990) under the Securities Act of 1933, as amended
("Act"), the registrant hereby undertakes as follows, which undertaking shall be
incorporated by reference into the registrant's Registration Statement on Form
S-8, Nos. 33-31754 (filed October 24, 1989) and 33-57306 (filed January 22,
1993).

Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

SIGNATURES
----------

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

CROWN RESOURCES CORPORATION

By: /s/ James R. Maronick
________________________
James R. Maronick
Vice President - Finance

Date: March 13, 1998
----------------

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

SIGNATURE TITLE DATE

/s/ Mark E. Jones, III * Principal Executive March 13, 1998
- -------------------------- Officer and Director --------------
Mark E. Jones, III
Chairman

/s/ James R. Maronick Principal Financial March 13, 1998
- -------------------------- and Accounting Officer --------------
James R. Maronick
Vice President - Finance

/s/ Christopher E. Herald
- --------------------------
Christopher E. Herald
President

/s/ J. Michael Kenyon *
- --------------------------
J. Michael Kenyon
A majority of
/s/ Rodney D. Knutson * the Board of March 13, 1998
- -------------------------- Directors --------------
Rodney D. Knutson

/s/ Linder G. Mundy *
- --------------------------
Linder G. Mundy

/s/ Steven A. Webster *
- --------------------------
Steven A. Webster

/s/ David R. Williamson *
- --------------------------
David R. Williamson

* By:/s/ James R. Maronick
_____________________
James R. Maronick, Attorney-in-fact

INDEX TO EXHIBITS
-----------------

Exhibit
Number Description Page
- ------- ----------- ----

3.1 The Company's Articles of Incorporation (incorporated by reference
to Exhibit 3.1 to Registration Statement on Form S-4, Commission
File No. 33-25033 (the "1989 S-4 Registration Statement")).

3.2 The Company's Bylaws (incorporated by reference to Exhibit 3.2 to
the 1989 S-4 Registration Statement).

3.3 Statement of Rights and Preferences of Series A Nonconvertible
Preferred Stock (issued to a subsidiary) as filed with the
Secretary of State, State of Washington, which forms part of the
Company's Articles of Incorporation (incorporated by reference to
Exhibit 3.3 to the Company's Form 10-K for the year ended December
31, 1989).

4.1 Form of Rights Agreement, dated as of July 25, 1995, between the
Company and American Stock Transfer & Trust Company (incorporated
by reference to Exhibit 4.1 to the Company's Form 8-K dated July
25, 1995).

10.1 1988 Stock Benefit Plan of the Company (incor-porated by reference
to Exhibit 10.11 to Amendment No. 2 to the Registration Statement).

10.2 1991 Stock Incentive Plan of the Company (incorporated by reference
to Exhibit 10.13 to Crown Resources Corporation's Registration
Statement on Form S-4 dated May 17, 1991, Commission file no. 33-
40642 (the "1991 S-4 Registration Statement")).

10.3 Crown Jewel Venture Agreement, dated effective January 4, 1991,
between Crown Resources Corporation, Crown Resource Corp. of
Colorado, Gold Texas Resources U.S., Inc., and Battle Mountain Gold
Company (incorporated by reference to Exhibit 10.10 to the 1991 S-4
Registration Statement).

10.4 Agreement and Plan of Merger, dated April 16, 1991, between Crown
Resources Corporation, Crown Resources Property Corporation and
Judith Gold Corporation (incorporated by reference to Exhibit 2.1
to Crown Resources Corporation's Form 8-K dated April 16, 1991).

10.5 Mining Lease, dated September 1, 1987, between Judith Gold
Corporation and Canyon Resources Corporation (incorporated by
reference to Exhibit 10.14 to the 1991 S-4 Registration Statement).

10.6 Settlement Agreement, dated September 29, 1992, between Battle
Mountain Gold Company, Crown Resource Corp. of Colorado, Keystone
Surveys, Inc., and Spenst M. Hansen (incorporated by reference to
Exhibit 10.18 to Crown Resources Corporation's Form 10-K for the
year ended December 31, 1992).

10.7 Mutual General Release and Settlement Agreement, dated September
29, 1992, between Crown Resources Corporation and its subsidiary,
Crown Resource Corp. of Colorado, Centurion Mines Corp., and Royal
Minerals, Inc. (incorporated by reference to Exhibit 10.19 to Crown
Resources Corporation's Form 10-K for the year ended December 31,
1992).

10.8 First Amendment to Mining Agreement, dated October 25, 1993,
between Crown Resource Corp. of Colorado and United States National
Bank of Oregon, as Trustee for William Cord Pereira, Virginia Lee
Pereira, Philip Kirk Pereira, Patrick Clay Pereira and Susan
Michele Pereira (incorporated by reference to Exhibit 10.20 to
Crown Resources Corporation's Form 10-K for the year ended December
31, 1993).

10.9 Option Contract for Conveyance between Crown Resource Corp. of
Colorado and Compania Minera del Amazonas S.A. (Bongara Even)
(incorporated by reference to Exhibit 10.21 to Crown Resources
Corporation's Form 10-K for the year ended December 31, 1993).

and Susan Michele Pereira (incorporated by reference to Exhibit
10.1 to Crown Resources Corporation's Form 10-Q for the quarter
ended March 31, 1994).

10.12 Settlement Agreement, dated May 6, 1994, between Crown Resources
Corporation, Crown Resource Corp. of Colorado, Gold Texas Resources
U.S., Inc. and Battle Mountain Gold Company (incorporated by
reference to Exhibit 10.2 to Crown Resources Corporation's Form 10-
Q for the quarter ended March 31, 1994).

10.13 Second Amendment to Crown Jewel Venture Agreement, dated April 27,
1994, between Crown Resources Corporation, Crown Resource Corp. of
Colorado, Gold Texas Resources U.S., Inc. and Battle Mountain Gold
Company (incorporated by reference to Exhibit 10.1 to Crown
Resources Corporation's Form 10-Q for the quarter ended June 30,
1994).

10.14 Agreement, dated September 8, 1994, between Crown Resource Corp. of
Colorado and Pinon Exploration Corporation (incorporated by
reference to Exhibit 10.1 to Crown Resources Corporation's Form 10-
Q for the quarter ended September 30, 1994).

10.15 Stock Purchase Agreement, dated September 9, 1994, between Cyprus
Gold Exploration Corporation and Crown Resource Corp. of Colorado,
relating to the Shares of Capital Stock of Pinon Exploration
Corporation (incorporated by reference to Exhibit 10.18 to Crown
Resources Corporation's Form 10-K for the year ended December 31,
1995).

10.16 First Amendment to Agreement between Crown Resource Corp. Of
Colorado and Pinon Exploration Corporation (incorporated by
reference to Exhibit 10.18 to Crown Resources Corporation's Form
10-K for the year ended December 13, 1995).

10.17 Third Amendment to Mining Agreement between United States National
Bank of Oregon, as Trustee for William Cord Pereira, Virginia Lee
Pereira, Philip Kirk Pereira, Patrick Clay Pereira and Susan
Michael Pereira, as Beneficiaries of the Pereira Children's Trust
and Crown Resource Corp. of Colorado (incorporated by reference to
Exhibit 10.19 to Crown Resources Corporation's Form 10-K for the
year ended December 31, 1995).

10.18 Letter Agreement, dated December 24, 1996, between Cominco Peru
s.r.l. and Minera Los Tapados S.A. (incorporated by reference to
Exhibit 10.18 to Crown Resources Corporation's Form 10K for the
year ended December 31, 1996).

10.19 Subscription Agreement and Warrant, dated February 27, 1997,
between Crown Resource Corp. of Colorado and Solitario Resources
Corporation subscribing for 1,500,000 units (a unit consisting of
one share of common stock and one share purchase warrant) of
Solitario Resources Corporation common stock.

11 Statement regarding computation of per share earnings.

22 Subsidiaries of the registrant.

24.1 Consent of Deloitte & Touche LLP.

25 Powers of attorney.

27 Financial data schedule.