SECURITIESAND EXCHANGE COMMISSION

 

 WASHINGTON, D.C. 20549
 

 FORM 10-QSB
 

(Mark One)
 

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

               **Forthe quarterly period ended October 31, 2003**

                                  
  OR

 
 (  )      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: 000-28915
 

 
**Sonoran Energy, Inc.**

(Exact name of registrant as specified in its charter)
 

** Washington, United States**

(State or other jurisdiction                                                of incorporation or organization)
  

**13-4093341**

(I.R.S. Employer ID Number)
 
 **1701 Westwind Dr., Ste. 127, Bakersfield, California 93301**

(Address of principal executive offices)   (Zip code)
 

**(866) 599-7676**

    * (Registrant's telephone number, including area code)*
 
**11300 W. Olympic Blvd., Suite 800, Los Angeles, California 90064**
*(Former Name, Former Address and Former Fiscal Year if Changed Since LastReport)*

      
 

Indicate by check mark whether the registrant (1) has filed all reportsrequired to be filed by Section 13 or 15(d) of the Securities ExchangeAct of 1934 during the preceding 12 months (or for such shorter periodthat the registrant was required to file such reports), and (2) has beensubject to such filing requirements for the past 90 days.
 

                         YES       X                                        NO               

                                     
Indicate the number of shares outstanding of each of the registrant'sclasses of common stock, as of the latest practicable date.
 

Class Shares outstanding at October 31, 2003

---------------------------------------------------------------

10,278,034 Shares Common Stock, no par value 

0 SharesPreferred stock, no par value
 
Page 1

 
CONTENTS

PART I.  FINANCIAL INFORMATION

Item 1.   Financial Statements

 

Item 2.   Management's Discussion and Analysis of Financial Condition

               and Results of Operations
 

Item 3.   Controls and Procedures

PART II. OTHER INFORMATION
 

Item 1.   Legal Proceedings
 

Item 2.   Changes in Securities
 

Item 3.   Defaults Upon Senior Securities
 

Item 4.   Submission of Matters to a Vote of Security Holders
 

Item 5.   Other Information
 

Item 6.   Exhibits and Reports on Form 8-K
Page 2

 

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

SONORAN ENERGY, INC.

(FORMERLY SHOWSTAR ONLINE.COM, INC..)
 

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

For the Periods Ended October  31, 2003 and 2002

TABLE OF CONTENTS
                                                                                                     

                                                                                                                                                                  **PAGE**
Condensed Consolidated Balance SheetsF-1  Condensed Consolidated Statements of    OperationsF-2  Condensed Consolidated Statement of Changes    in Shareholders' DeficitF-3  Condensed Consolidated Statements of Cash    FlowsF-4  Notes to Unaudited Condensed Consolidated Financial    StatementsF-5    
                                                               
Page 3

SONORAN ENERGY, INC.

(FORMERLY SHOWSTAR ONLINE.COM, INC..)
Condensed Consolidated Balance Sheet

(Unaudited)

October31, 2003

 

**ASSETS**         Current assets:              Cash$          58,541             Accounts receivable40,027             Loan receivable2,525             Accrued interest receivable412             Prepaid expenses37,500                       Total current assets139,005          Restricted cash - Idle well bond (Note B)    75,491        Oil and gas properties - full cost method (Note D):              Proved803,008             Unproved514,908                       Total oil and gas properties1,317,916             Accumulated depletion(19,495)                       Net oil and gas properties1,298,421          Assets available for sale (Note C)309,743 $  1,822,660  
**LIABILITIES AND SHAREHOLDERS' DEFICIT**         Current liabilities:              Accounts payable$       490,020             Accrued expenses257,473             Loans payable870,000             Accrued interest payable323,243             Indebtedness to related parties5,752                       Total current liabilities1,946,488          Long-term debt:              Notes payable1,200,000                       Total liabilities3,146,488          Shareholders' deficit:              Preferred stock, no par value; 25,000,000 shares authorized,                   no shares issued and outstanding-             Common stock, no par value; 75,000,000 shares authorized,                   10,278,034 shares issued and outstanding    14,752,403             Additional paid-in capital380,000             Outstanding common stock options - 150,00021,000             Outstanding common stock warrants - 150,0007,200             Cumulative translation adjustments11,840             Deficit Accumulated(16,496,271)                       Total shareholders' deficit(1,323,828)   $  1,822,660  
Page F-1

SONORAN ENERGY, INC.

(FORMERLY SHOWSTAR ONLINE.COM, INC..)
Condensed Consolidated Statements of Operations

(Unaudited)

 
 **For the Six Months Ended 31-Oct** **For the Three Months Ended 31-Oct** **2003** **2002** **2003** **2002**        Revenue               Sales$        214,528 $                 - $       108,936 $                     -        Other3,000 - 1,500 -                          Total revenue217,528 - 110,436 -        Costs and expenses               Oil and gas production costs125,475 - 53,301 -        Depletion15,267 - 7,789 -        Stock-based compensation                    Consulting48,100 115,700 21,000 86,700             Investor Relations6,750 - 6,750 -             Debt issue costs20,500 - 18,000 -        General and administrative172,932 215,065 92,877 113,370        Liability settlement gains(13,675) - (13,149) -                          Total costs and expenses(375,349) (330,765) (186,568) (200,070)        Interest income274 - 123 -Interest expense(143,639) (30,679) (70,689) (5,756)                          Loss from continuing operations before                              income taxes(301,186) (361,444) (146,698) (205,826)        Income tax provision- - - -                          Net loss$  (301,186) $  (361,444) $    (146,698) $     (205,826)        Net loss per common    share:               Basic and diluted$       (0.03) $        (0.07) $             (0.01) $              (0.03)Basic and diluted    weighted average common shares               outstanding9,552,938 4,891,249 10,024,544 6,754,193        
 

 

Page F-2

SONORAN ENERGY, INC.

(FORMERLY SHOWSTAR ONLINE.COM, INC..)
Condensed Consolidated Statement of Changes in Shareholders' Deficit

(Unaudited)

 
 **Common Stock** **Additional Paid-In Capital**   **Deficit Accumulated During Development Stage** 
**Cumulative    Translation Adjustment**

**Other    Comprehensive Loss** **Total** **Shares** **Amount**  
**Outstanding**

**Common**

**Stock**

**Options/**

**Warrants**                 Balance at April 30, 20038,854,444 $14,589,663 $380,000 $                7,200 $(16,195,085) $22,687 $(1,195,535)                  Dividend paid August 22, 2003753,542 - - - - - 0       -      Common    stock sales100,000 20,000 - - - - 20,000Common    stock issued in exchange for      -           consulting services    113,286     33,850 - 21,000 - -     54,850
Common stock    issued in exchange for                     debt issue costs    70,000     20,500 - - - -     20,500
Common stock    cancelled    (18,800)     (13,000) - - - -     (13,000)
Common stock    issued in exchange for

        debt payments    405,562     101,390 - - - -     101,390
Comprehensive    loss:

        Net loss, six months ended October 31,      
     2003- - - -     (301,186) -     (301,186)Cumulative translation adjustment- - - - - (10,847)     (10,847)Comprehensive loss- - - - - - (312,033)              Balance as at October 31, 200310,278,034 $14,752,403 $380,000 $28,200 $(16,496,271) $11,840  (1,323,828)              
 

PageF-3

SONORAN ENERGY, INC.

(FORMERLY SHOWSTAR ONLINE.COM, INC..)
CondensedConsolidated Statements of Cash Flows

(Unaudited)

 
 
**For the Six Months Ended**

**October 31,** **2003** **2002**    Net cash provided by (Used In) Operating    Activities$                    (97,948) $              (271,602)    Cash flows from investing activities:        Purchases of oil and    gas properties(26,130)     (164,908)             Net cash used in investing activities(26,130) (164,908)    Cash flows from financing activities:        Proceeds from    advances200,000 856,188     Repayment of    advances(50,000) (25,000)     Proceeds from the    sale of common stock- 142,488             Net cash provided by financing activities150,000 973,676                      Net change in cash25,922 537,166    Cash, beginning of period32,619 7,710    Cash, end of period$              58,541 $              544,876    Supplemental disclosure of cash flow    information:        Cash paid for income    taxes$                      - $                        -     Cash paid for    interest$         42,000 $                        -    Non-cash investing and financing activities:   
        Common stock issued for payment of advances and accrued

             liabilities$       101,390 $         610,341     Common stock issued    for properties$                      - $         350,000     Common stock issued    for services$         33,850 $         123,125    
 

PageF-4

SONORAN ENERGY,INC.

 

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
October 31, 2003
 

NOTE A:   General Information

 

The accompanying unaudited condensed consolidatedfinancial statements of Sonoran Energy, Inc. as of and for the six and three monthsended October 31, 2003 and October 31, 2002 have been prepared in accordance with therules and regulations of the Securities and Exchange Commission and do notinclude all of the information and footnotes required by generally acceptedaccounting principles for complete financial statements.

 

In the opinion of management,all adjustments considered necessary for a fair presentation of the results ofthe interim period have been included.  Operating results for any interim periodare not necessarily indicative of the results that may be expected for theentire fiscal year. These statements should be read in conjunction with theconsolidated financial statements and notes thereto for the year ended April 30,2003 included in the Company's report in Form 10-KSB/A as filed with theSecurities and Exchange Commission.

 

                 Change in Business Plan
 
In June 2002, the Company changed its business plan and ceased its Internet portal web site operations.  The Company has now transitioned into the oil and gas industry.  The Company's primary objective is to identify, acquire and develop working interest percentages in smaller, underdeveloped oil and gas projects located in California that do not meet the requirements of the larger producers and developers.
 
NOTE B.   Restricted Cash - Letter of Credit
 
The Company was required to post an Idle Well Bond with the Government prior to beginning operations on the oil well leases.  The funds are being held in an investment certificate, by the bank, which bears interest currently at .8 %. 
 
NOTE C.   Assets Available For Sale  
 
As ofOctober 31, 2003, the Company owed First Nevisian (FN) $843,000 and $270,838 in related accrued interest. In addition, FN holds property and equipment owned by the Company with a book value of approximately $309,743. The two parties are still in negotiations on a settlement agreement whereby FN would reduce the balance of principal and interest owed on the loans in exchange for the Company's property and equipment held by FN. The net realizable value of the property and equipment held by FN is included in the accompanying consolidated financial statements as "assets available for sale".
 

       Depreciation

 

The Company had not recorded any depreciation in thisquarter as no operating benefit has accrued during the period.

 

NOTE D.   Oil and GasProperty Leases

 

The Company follows the full cost method ofaccounting for its oil and gas activity. Accordingly, all costs associated withthe acquisition, exploration and development of oil and gas properties arecapitalized within the appropriate cost center.  Any internal costs that arecapitalized are limited to those costs that can be directly identified withacquisition, exploration, and development activities undertaken by the Companyfor its own account, and do not include any costs related to production, generalcorporate overhead, or similar activities.

 

All capitalized costs within a cost centerare depleted on the units-of-production method based on estimated provedreserves attributable to the oil and gas properties owned by the Company. 

 

For each cost center, capitalized costs lessaccumulated depletion and related deferred income taxes, may not exceed the costcenter ceiling.  Any excess is charged to expense during the period in which theexcess occurs.  The cost center ceiling is equal to the sum of:

 

(a) The present value of estimated futurenet revenues from proved oil and gas reserves, less estimated futureexpenditures to be incurred in developing the proved reserves computed using a10 percent discount factor; (b) the cost of properties not being amortized; (c)the lower of cost or fair market value of unproven properties included in thecosts being amortized; and (d) income tax effects related to the differencesbetween the book and tax basis of the properties.

 

If a significant portion of the Company'soil and gas interests are sold, a gain or loss would be recognized; otherwise,proceeds from sales are applied as a reduction of oil and gas properties. TheCompany did not sell any of its oil and gas properties during the quarter endedOctober 31, 2003. 
 

The Company recorded $7,789 in Depletion expense for thequarter and $15,267 for the six months.  There was no expense in the firstsix months of 2002 as we had noresource operations at that time.

 

NOTE E.    Stock Dividend

 

The Company declared an 8% unit stock dividendpayable to stockholders of record at the close of business on Wednesday, July22, 2003.  the unit stock dividend, paid on August 22, 2003 consisted onone share plus a warrant allowing shareholders to purchase 1 share for each tenshares of Sonoran Stock held on the record date at a $1 strike price.  Theamount of shares issued on August 22, 2003 was 753,542.

 

Page F-5

 

**ITEM 2.  MANAGEMENT'SDISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS**

 

This report containsforward-looking statements. For this purpose, any statements contained herein that are notstatements of historical fact may be deemed forward-looking statements. Withoutlimiting the foregoing, the words "believes", "anticipates", "plans", "expects"and similar expressions are intended to identify forward-looking statements.Readers are cautioned not to place undue reliance on forward-looking statements,which speak only as of the date hereof. The Company undertakes no obligation topublicly release the results of any revisions to these forward-lookingstatements that may be made to reflect events or circumstances after the datehereof or to reflect the occurrence of unanticipated events.  Theseforward-looking statements should be read in conjunction with the Company'sdisclosures included in their Form 10-KSB/A for the fiscal year ended April 30,2003.

 
**Overview**

 
Sonoran Energy, Inc. (the "Company", "Sonoran" and sometimes "we," "us," "our"and derivatives of such words), formerly named Showstar Online.com Inc., wasincorporated on July 14, 1995 in the State of Colorado as Cerotex Holdings,Inc.  Prior to June 2002 the company had developed software and an art site onthe Internet. The project had to be discontinued due to lack of funding. On June3, 2002 the Company changed its name to Sonoran Energy, Inc. and began theacquisition of undervalued oil and gas properties.

 **General
****
Results from the second quarter were highlighted bythe completion of the holding tank and the well reactivation program on theCompany's Emjayco Glide #33 property.  The tank replacement was completedin July and production on Glide started up in August.  The reactivationwork was intended to increase oil production on the 160-acre property byreactivating several additional well sites.  Well #5 on the Emjayco Glide#33 property was the first to be successfully reactivated.  This is thefirst production from this well since 1970 when it was shut down by a fire. By the end of October, hte oil cut was 1% on a flow of 780 barrels a day. A new pump unit installed on the #5 well now has the largest capacity of anypump unit on the Glide lease.  Sonoran Energy and its operating partner,Longbow LLC, now plan to study the viability of upgrading several other wells onthe Glide lease to larger units.  In exchange for the reactivation work onGlide #5, Sonoran's operating partner, Longbow LLC, received an earlier advanceof 10% on its net revenue interest on the Glide property.  Sonoran Energywas receiving an 80-20 split on net revenues from the Glide lease before movingto a 60-40 working interest split once 150% of the acquisition costs arerealized.  Following the exchange, Longbow receives an additional 10%moving the split on net revenues to 70-30 until 150% of the acquisition costsare realized.  It will then move to 60-40.  The Keystone and Merzonianfields continue to produce well and are averaging about 1,000 barrels a month eachwhich exceeds our original forecasts.
 
The Company was also successful in raising an additional $200,000 to cover itsdevelopment costs in the quarter.  Sonoran also received recompletion cashcalls as part of its participation in the Gay 12-1, WH Smith #2 and Lambie 4-3gas wells.  The Gay 12-1 project was successful and is producing, the WHSmith #2 was plugged and shut in, and the Lambie was also successful and is nowin production.
 
In October, the Company acquired a minimum 4% working interest in a 160-acre oiland gas prospect known as the Northeast 12 Prospect with a potential reserve of4.6 BCF of 1000+ BTU gas.  Sonoran also has the right to participate in allfuture wells on the prospect located in the North West Lost Hills Oil and GasField in Kern County, California.  If the drilling program is successful,Sonoran has an option to acquire similar working interests in up to 14additional prospects adjoining the property.
 

Page 4  

****
**Analysis of Operations**

****
Results of Operations for the Six Months EndedOctober 31, 2003 compared to the Six Months Ended October 31, 2002:

 

REVENUES

 

Revenue was $214,528 in the six months endedOctober 31, 2003 and $0 inthe six months ended October 31, 2002. As the Company changed its business planearly in June 2002 to enter the oil and gas industry there were no revenuegenerating operations in the first six months of last year.  The factorsimpacting revenue for October 31, 2003 are discussed above in the generalcomments.   

 

OPERATING EXPENSES

 

Operating expense was $125,475 in the six monthperiod ended October 31, 2003 and$0 in October 31, 2002.  Operating expense as a percentage ofrevenue increased slightly in this quarter reflecting the cash calls mentionedabove on the gas properties.

 

GENERAL AND ADMINISTRATIVE EXPENSES

 

General and administrative expenses decreased byapproximately 20 % for the six months ended October 31, 2003, when compared with thesame period for 2002. General and administrative expense includes all thecompany administrative expense, officer fees, travel, legal and accounting. Management contiues to try to keep these costs at minimal levels withoutinhibiting the efficient operation of the Company. Stock based consulting hasbeen reduced as the Company no longer needs the concentrated effort it has inthe early stages of its entrance into the oil and gas industry. 

 

INTEREST EXPENSE

 

Interest expense was $143,639 for the six monthsended October 31, 2003 and $70,689 in October 31, 2002. The increase in expense is due primarily to the NotePayable issued in connection with the acquisition of property in December 2002. 

 

PROVISION FOR DEPLETION, DEPRECIATION ANDAMORTIZATION

 

The provision for depletion, depreciation andamortization was $15,267 for the six months ended October 31, 2003 reflecting the costassociated with the  operations from the oil and gas leases whichwere not part of the Company in 2002.

 

OTHER INCOME (EXPENSE)

 

The liability settlement gains arise from theCompany being able to settle longer term debt from expense incurred prior to itsentry into the oil and gas industry.

 
Liquidity and Capital Resources
 

TheCompany believes that its existing current assets and the amount of cash itanticipates it will generate from current operations will be sufficient to fundthe anticipated liquidity and capital resource needs of the Company for thefiscal year ended April 30, 2004.  The Company expects to increase its capitalexpenditures during the current fiscal year to increase its current oil and gasproduction capacities through acquisitions and on-site development in currentholdings. The Company will need to continue to attract additional financing inorder to move forward with these efforts. 

 

The Company is not a party to off-balance sheetarrangements and does not engage in trading activities involving non-exchangetraded contracts.  In addition, the Company has no financial guarantees, debt orlease agreements or other arrangements that could trigger a requirement for anearly payment or that could change the value of the Company's assets. Management continues to examine various alternatives for increasing capitalresources including, among other things, participation with industry and/orprivate partners and specific rework of existing properties to enhanceproduction and expansion of its sales of crude oil and natural gas inCalifornia.  

 

ForeignCurrency Exposure
 
Sonoran is not exposed to fluctuations in foreign currencies relative to the U.S. dollar at this time but, as Sonoran expands its operations, it may begin to collect revenues from customers in currencies other than the U.S. dollar. Sonoran does not currently engage in any hedging activities.
 

 
**Item 3.   Controls and Procedures.**

 

The Company's Chief Executive Officer and Chief Financial Officer have concluded, basedon an evaluation conducted within 90 days prior to the filing date of this quarterly report on Form10-QSB, that the Company's disclosure controls and procedures have functioned effectively so asto provide those officers the information necessary whether:
 

        (i) this quarterly report on Form 10-QSB contains any untrue statement of a materialfact or omits to state a material fact necessary to make the statements made, in lightof the circumstances under which such statements were made, not misleading withrespect to the period covered by this quarterly report on Form 10-QSB, and
 

        (ii) the financial statements, and other financial information included in this quarterlyreport on Form 10-QSB, fairly present in all material respects the financial condition,results of operations and cash flows of the Company as of, and for, the periodspresented in this quarterly report on Form 10-QSB.
There have been no significant changes in the Company's internal controls or in other factorssince the date of the Chief Executive Officer's and Chief Financial Officer's evaluation that couldsignificantly affect these internal controls, including any corrective actions with regards to significantdeficiencies and material weaknesses. 

 

Page 5

 

 

**PART II - OTHER INFORMATION**

**Item 1.     Legal information**

 

                              No response required

 

**Item 2.     Changes insecurities**

 

                              Stock issues are reported on the Change in Equity Statement filed with thisreport

 

**Item 3.     Defaults UponSenior Securities:**

 

                              No response required

 

**Item 4.     Submission ofMatters to a Vote of Security Holders**

 

                              The Company submitted an information statement to the principal holders of theoutstanding common stock and received 52.95% of the votes which:

        

           (1) approved the elections of John Punzo, Russ Costin, and Flavio Bidese to theCompany's Board of Directors; and

           (2) approved the Company's 2003 Stock Option Plan.

 

**Item 5.     OtherInformation**

 

                              No response required

                                  

**Item 6.    Exhibits and Reportson Form 8-K**

 

a)    Exhibits:
        

   31.  Rule 13a-14(a)/15d-14(a) Certifications

   32.  Section 1350 Certifications

 

b)    Reports onForm 8-K:
 
    None

 

 
 

        
Page6
 
**SIGNATURES**

         In accordance with the requirements of the Exchange Act, the registrant caused this reportto be signed on its behalf by the undersigned, thereunto duly authorized.

                                             
**SONORAN ENERGY, INC.**
(Registrant)

Dated: November25, 2003                                                                     By: /s/ J. Punzo                                                                                                                     J. Punzo

                                                                                                                  President, and Chief Executive Officer
 
Dated: November25,2003                                                                      By: /s/ Russ Costin
                                                                                                                Russ Costin
                                                                                                                Chief Financial Officer
 

 

 

Page 7

 

**Exhibit 31.1**

 

**CERTIFICATION PURSUANT TO 18 U.S.C.SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 CERTIFICATIONS**

 

 I, John Punzo, certify that:

 

1.    I have reviewed thisquarterly report on Form 10-QSB of Sonoran Energy, Inc.;

2.    Based on my knowledge, thisquarterly report does not contain any untrue statement of material fact or omit to state a material face necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisquarterly report;

 

3.    Based on my knowledge, the financial statements, and other financial information included in thisquarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in thisquarterly report;

 

4.    The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

 

     a.    designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which thisquarterly report is being prepared;

 

     b.    evaluated the effectiveness of the registrant's disclosure controls and procedures as of adate within 90 days prior to the filing date of this quarterly report (the"Evaluation Date"); and 

 

    c.    presented in thisquarterly our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.    The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

     

     a.    all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

     

     b.    any fraud, whether or not material, that involves management or other employees who

have a significant role in the registrant's internal controls; and

 

6.    The registrant's other certifying officers and I have indicated in thisquarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent, evaluation, including anycorrective actions with regard to significant deficiencies and materialweaknesses. 

 

Date:     November 25, 2003

 

 /s/ John Punzo

John Punzo

Chief ExecutiveOfficer/President/Director 

 

**Exhibit 31.2**

 

**CERTIFICATION PURSUANT TO 18 U.S.C.SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 CERTIFICATIONS**

****

 I, Russ Costin, certify that:

1.    I have reviewed thisquarterly report on Form 10-QSB of Sonoran Energy, Inc.;

2.    Based on my knowledge, thisquarterly report does not contain any untrue statement of material fact or omit to state a material face necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisquarterly report;

3.    Based on my knowledge, the financial statements, and other financial information included in thisquarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in thisquarterly report;

4.    The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a.    designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which thisquarterly report is being prepared;

     b.    evaluated the effectiveness of the registrant's disclosure controls and procedures as of adate within 90 days prior to the filing date of this quarterly report (the"Evaluation Date"); and 

 

    c.    presented in thisquarterly our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.    The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

     

     a.    all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

     

     b.    any fraud, whether or not material, that involves management or other employees who

have a significant role in the registrant's internal controls; and

6.    The registrant's other certifying officers and I have indicated in thisquarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent, evaluation, including anycorrective actions with regard to significant deficiencies and materialweaknesses. 

 

Date:     November 25, 2003

 

 /s/ Russ Costin

Russ Costin,

Chief FinancialOfficer

**Exhibit 32.1**

 

**CERTIFICATION PURSUANT TO 18 U.S.C. Section 1350, AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

    In connection with the Quarterly Report of SonoranEnergy, Inc. on Form 10-QSB for the quarter ending October 31, 2003, as filed with theSecurities and Exchange Commission on the date hereof (the "Report"), I,John Punzo, Chief Executive Officer, President and Director of the Company, certify, pursuantto 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of theSarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief: (1)the Report fully complies with the requirements of Section 13(a) or 15(d) of theSecurities Exchange Act of 1934; and (2) the information contained in the Reportfairly presents, in all material respects, the financial condition and result ofoperations of the Company. 

/s/ John Punzo

John Punzo

Chief ExecutiveOfficer/President/Director 

November 25, 2003

 
**Exhibit 32.2**

**CERTIFICATION PURSUANT TO 18 U.S.C. Section 1350, AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

    In connection with the Quarterly Report of Sonoran Energy, Inc.on Form 10-QSB for the quarter ending October 31, 2003, as filed with theSecurities and Exchange Commission on the date hereof (the "Report"), I,Russ Costin, Chief Financial Officer of the Company, certify, pursuantto 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of theSarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief: (1)the Report fully complies with the requirements of Section 13(a) or 15(d) of theSecurities Exchange Act of 1934; and (2) the information contained in the Reportfairly presents, in all material respects, the financial condition and result ofoperations of the Company. 

/s/ Russ Costin

Russ Costin

Chief FinancialOfficer 

November 25, 2003

 **