Virginia Mines Inc.
(an exploration company)
Interim Balance Sheet (unaudited)

(expressed in Canadian dollars)

The accompanying notes are an integral part of these interim financial statements.

Approved by the Board of Directors

_/s/André Gaumond______, Director ____/s/André Lemire______, Director

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Virginia Mines Inc.
(an exploration company)
Interim Statements of Earnings and Comprehensive Income (unaudited)

(expressed in Canadian dollars)

The accompanying notes are an integral part of these interim financial statements.

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Virginia Mines Inc.
(an exploration company)
Interim Statement of Changes in Shareholders’ Equity (unaudited)
For the six-month period ended August 31, 2007

(expressed in Canadian dollars)

The accompanying notes are an integral part of these interim financial statements.

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Virginia Mines Inc.
(an exploration company)
Interim Statement of Changes in Shareholders’ Equity (unaudited)
For the six-month period ended August 31, 2006

(expressed in Canadian dollars)

The accompanying notes are an integral part of these interim financial statements.

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Virginia Mines Inc.
(an exploration company)
Interim Statements of Cash Flows (unaudited)

(expressed in Canadian dollars)

The accompanying notes are an integral part of these interim financial statements.

Page 5

Virginia Mines Inc.
(an exploration company)
Interim Statements of Cash Flows (unaudited)

(expressed in Canadian dollars)

The accompanying notes are an integral part of these interim financial statements.

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Virginia Mines Inc.
(an exploration company)
Notes to Interim Financial Statements (unaudited)

(expressed in Canadian dollars)

1. Interim financial information

The financial information as at August 31, 2007 and for the three and six-month periods ended August 31, 2007 and 2006 is unaudited. However, in the opinion of management, all adjustments necessary to present fairly the results of these periods have been included. The adjustments made were of a normal recurring nature. Interim results may not necessarily be indicative of results anticipated for the year.

These unaudited interim financial statements have been prepared in accordance with Canadian generally accepted accounting principles and use the same accounting policies and methods used in the preparation of Virginia Mines Inc's. ("Virginia Mines") most recent annual financial statements except for the new accounting standards as described in note 2. All disclosures required for annual financial statements have not been included in these financial statements. These unaudited interim financial statements should therefore be read in conjunction with Virginia Mines' most recent audited financial statements

2. New accounting standards
Financial instruments

In January 2005, the CICA issued four new accounting standards in relation with financial instruments: section 3855 "Financial Instruments – Recognition and measurement", section 3865 "Hedges", section 1530 "Comprehensive Income" and section 3251 "Equity".

Section 3855 expands on section 3860 "Financial Instruments – Disclosure and Presentation", by prescribing when a financial instrument is to be recognized on the balance sheet and at what amount. It also specifies how financial instrument gains and losses are to be presented.

Section 3865 provides alternative treatments to section 3855 for entities which choose to designate qualifying transactions as hedges for accounting purposes. It replaces and expands on Accounting Guideline AcG-13 "Hedging Relationships", and the hedging guidance in Section 1650 "Foreign Currency Translation" by specifying how hedge accounting is applied and what disclosure is necessary when it is applied.

Section 1530 "Comprehensive Income" introduces a new requirement to temporarily present certain gains and losses outside net income.

Consequently, Section 3250 "Surplus" has been revised as Section 3251 "Equity".

Sections 1530, 3251, 3855 and 3865 were adopted by the Company on March 1, 2007.

Short-term investments

The short-term investments are classified as available-for-sale investments. The Company recognizes transactions on the settlement date.

These investments are recognized at fair value. Unrealized gains and losses are recognized, net of income taxes, if any, in "Accumulated other comprehensive income". Upon the disposal or impairment of these investments, these gains or losses are reclassified in the statement of earnings.

A difference of $4,998,383 (after deduction of income tax expenses of $880,965) between the carrying amount and the fair value of investments classified as available for sale is recognized as an adjustment to the opening balance of "Accumulated other comprehensive income".

Transition

The recognition, derecognition and measurement methods used as well as the hedge accounting policies used to prepare the financial statements of periods prior to the effective date of the new standards were unchanged and, therefore those financial statements have not been restated.

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Virginia Mines Inc.
(an exploration company)
Notes to Interim Financial Statements (unaudited)

Accounting changes

Effective January 1, 2007, the Company adopted CICA Handbook Section 1506 “Accounting Changes”. This Section establishes criteria for changes in accounting policies, accounting treatment and disclosures regarding changes in accounting policies, estimates and corrections of errors. In particular, this Section allows for voluntary changes in accounting policy only when they result in the financial statements providing reliable and more relevant information. Furthermore, this section requires disclosure of when an entity has not applied a new source of GAAP that has been issued but is not yet effective. Such disclosures are provided below. The adoption of this Section had no further effects on the financial statements for the quarter and the three and six-month period ended August 31, 2007.

Impact of accounting pronouncements not yet adopted

Capital Disclosure

The CICA issued Section 1535, “Capital Disclosures”. This standard establishes guidelines for disclosure of information regarding an
entity’s capital which will enable users of its financial statements to evaluate an entity’s objectives, policies and processes for managing capital, including disclosures of any externally imposed capital requirements and the consequences of non-compliance. The new requirements will be effective on fiscal years starting January 1, 2008. The Company is presently evaluating the impact of this new standard.

Financial Instruments – Disclosures and Financial Instruments - Presentation

The CICA issued Section 3862, “Financial Instruments – Disclosures” and Section 3863, “Financial Instruments – Presentation” which replace Section 3861, “Financial Instruments – Disclosure and Presentation”. The new disclosure standard requires the disclosure of additional detail of financial asset and liability categories as well as a detailed discussion on the risks associated with the company’s financial instruments. This standard harmonizes disclosures with International Financial Reporting Standards (“IFRS”). The presentation requirements are carried forward unchanged. These new standards will be effective on fiscal years starting January 1, 2008. The Company is presently evaluating the impact of these new standards.

3. Long-term investments

As at August 31, 2007, included in long term investments were third party-sponsored asset backed commercial paper (“Third Party ABCP”) with the par value of $3,800,000. These investments have been classified as Hold to Maturity on initial recognition and are carried at amortized cost totaling $3,793,467. During the month of August, the Canadian Third Party ABCP market experienced liquidity problems. As a result, in some cases, as notes matured certain Canadian Third Party ABCP programs were unable to raise funds from new issuances and therefore were not able to refund maturing notes. At this time, the conduits are subject to a proposal which calls for the notes to be converted into floating rate notes which better match the duration of the underlying assets to address the liquidity problem.

Maturity dates on outstanding ABCP’s go from August 23, 2007 to October 10, 2007, and repayments in the amount of $300,000, due before August 31, 2007, were not repaid and amount of $3,500,000 due between August 31, 2007 to October 10, 2007 were not repaid also.

While the credit rating of the investments is under review, at the time of investment they were rated R1-high for $3,500,000 and R1-middle for $300,000 by Dominion Bond Rating Service, the highest credit rating for this type of investment. Given that these investments are classified as held to maturity, they are tested for “other than temporary impairment” when there is an objective evidence of impairment. An impairment loss of $380,000 representing the difference between the fair value and amortized cost of investments was recorded on the basis that it is probable that the Company will not be able to collect all amounts due according to the original contractual terms. As there was no market data available, the management estimated the fair value by discounting the expected future cash flows according to the probability of recoverability of principal and interest. It is reasonably possible that actual timing and amount ultimately recovered may differ materially from this estimate.

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Virginia Mines Inc.
(an exploration company)
Notes to Interim Financial Statements (unaudited)

(expressed in Canadian dollars)

4. Mining properties

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Virginia Mines Inc.
(an exploration company)
Notes to Interim Financial Statements (unaudited)

(expressed in Canadian dollars)

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Virginia Mines Inc.
(an exploration company)
Notes to Interim Financial Statements (unaudited)

(expressed in Canadian dollars)

Change in mining properties

* On August 28, 2007, the Company entered into agreement with Strateco Resources Inc. pursuant to which
Strateco Resources Inc. acquires a 100% interest in the 88 claims of the Apple property, in exchange for the
issuance to the Company of 3,250,000 common shares of Strateco Resources Inc. at a price per share of
$1.8455. This value has been calculated with the average stock price for the five previous and subsequents
days of the transaction. The value of the shares received has been reduced by 12% as to consider the four-
month period sale restriction. The agreement is subject to a 2% net smelter return (NSR) in favour of the
Company. Strateco may buy back 1% of the royalty for $1,000,000. The gain of $5,250,826 arising from this
transaction is presented in the financial statements under "Gain on sale of mining properties".

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Virginia Mines Inc.
(an exploration company)
Notes to Interim Financial Statements (unaudited)

(expressed in Canadian dollars)

5. Stock options

The options granted are exercisable over a maximum period of ten years following the date of grant.
The following table summarizes information about stock options outstanding as at August 31, 2007 :

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Virginia Mines Inc.
(an exploration company)
Notes to Interim Financial Statements (unaudited)

(expressed in Canadian dollars)

6. Earnings per share

For the three and six-month periods ended August 31, 2006, there was no difference between the basic and diluted loss per share since the dilutive effect of stock options was not included in the calculation; otherwise, the effect would have been anti-dilutive. However, the net loss diluted per share for this period was calculated according to the basic weighted average number of shares outstanding.

7. Subsequent Event

On September 4, 2007, the Company announced the signing of an amendment to the Coulon JV Project Agreement pursuant to which Virginia optioned to Breakwater Resources Ltd. (“Breakwater”) the Fontanges Sud and Coulon Pitaval properties, located to the south and to the north of the Coulon JV property respectively. With this amendment, the Fontanges Sud and Coulon Pitaval properties are now merged with the Coulon JV property, thus bringing the surface area of the new property to over 1,600km2.

According to this new agreement, Breakwater has the option to acquire a 50% interest in the Coulon JV property in exchange for $7,500,000 (formerly $6,500,000) in exploration expenditures over a 9-year period (formerly 8 years) and payments totalling $180,000 over a four-year period. Virginia will remain the operator until the completion of a pre-feasibility study.

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