UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB
(Mark One)

      [X]   QUARTERLY  REPORT  UNDER  SECTION  13 OR  15(d)  OF  THE  SECURITIES
            EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 2007

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

                  For the transition period from _____ to _____

Commission File Number: 1-5742

                             OCEAN POWER CORPORATION
                 (Name of small business issuer in its charter)

                Delaware                                          94-3350291
    (State or other jurisdiction of                           (I.R.S. Employer
     incorporation or organization)                          Identification No.)

   c/o Halperin Battaglia Raicht, LLP
     555 Madison Avenue, 9th Floor
           New York, New York                                       10022
(Address of principal executive offices)                          (Zip Code)

                                 (212) 765-9100
                           (Issuer's telephone number)

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
section 13 or 15(d) of the Securities Exchange Act during the past 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 whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). [X] Yes [ ] No

Check  whether the issuer has filed all  documents  and  reports  required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the  distribution  of
securities under a plan confirmed by a court. [ ] Yes [X] No

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

              56,182,746 shares outstanding as of January 28, 2008

Transitional Small Business Disclosure Format: [ ] Yes [X] No
<PAGE>
NOTE: Unless otherwise indicated, this Form 10-QSB of Ocean Power Corporation
(the "Company") speaks as of the date of the filing thereof with the Securities
and Exchange Commission ("SEC"). On March 1, 2002, due to non-payment of
applicable taxes the Company's original charter became inoperative and void. On
October 25, 2007, the Company filed a certificate of renewal and revival of its
charter in the state of Delaware. During the period from March 1, 2002 to
October 25, 2007, the name Ocean Power was obtained by an unrelated entity upon
proper filing with the State of Delaware. As such, as part of the Company's
renewal and revival of its charter, the Company changed its name from Ocean
Power Corporation to OPC Liquidation Corporation.
<PAGE>

                         PART I -- FINANCIAL INFORMATION

Item 1. Financial Statements

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)

                   UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                                  June 30, 2007
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
                           Consolidated Balance Sheet

                                     ASSETS
                                     ------

                                                                    June 30,
                                                                      2007
                                                                  -------------
                                                                   (Unaudited)

CURRENT ASSETS

   Cash - restricted                                              $     629,436
                                                                  -------------

         Total Current Assets                                           629,436
                                                                  -------------

EQUIPMENT, NET                                                                -
                                                                  -------------

TOTAL ASSETS                                                      $     629,436
                                                                  =============

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
                 ----------------------------------------------

CURRENT LIABILITIES

   Accounts payable                                               $   2,825,518
   Accrued expenses                                                  10,038,092
   Notes payable - related parties                                    1,033,469
   Notes and convertible debentures payable - current portion         8,674,884
                                                                  -------------

         Total Current Liabilities                                   22,571,963
                                                                  -------------

         Total Liabilities                                           22,571,963
                                                                  -------------

STOCKHOLDERS' EQUITY (DEFICIT)

   Preferred stock: 20,000,000 shares authorized of
      $0.001 par value; no shares outstanding                                 -
   Common stock: 500,000,000 shares authorized of
      $0.01 par value; 56,182,746 shares issued
      and outstanding                                                   561,827
   Additional paid-in capital                                        35,169,137
   Deficit accumulated during the development stage                 (57,673,491)
                                                                  -------------

         Total Stockholders' Equity (Deficit)                       (21,942,527)
                                                                  -------------

         TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
            (DEFICIT)                                             $     629,436
                                                                  =============

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

                                       2
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
                Consolidated Statements of Operations (Unaudited)

<TABLE>
<CAPTION>
                                                                                                            From
                                                     For the                       For the              Inception on
                                               Three Months Ended              Six Months Ended           March 26,
                                                     June 30,                      June 30,             1992 Through
                                          ---------------------------   ----------------------------      June 30,
                                              2007           2006           2007           2006             2007
                                          ------------   ------------   ------------   -------------   -------------
<S>                                       <C>            <C>            <C>            <C>             <C>
REVENUES                                  $          -   $          -   $          -   $           -   $           -
                                          ------------   ------------   ------------   -------------   -------------

EXPENSES

      General and administrative               122,987         25,413        257,679          59,219         934,109
      Depreciation and amortization                  -              -              -               -          15,964
                                          ------------   ------------   ------------   -------------   -------------

            Total Expenses                     122,987         25,413        257,679          59,219         950,073
                                          ------------   ------------   ------------   -------------   -------------

            LOSS FROM OPERATIONS              (122,987)       (25,413)      (257,679)        (59,219)       (950,073)
                                          ------------   ------------   ------------   -------------   -------------

OTHER INCOME (EXPENSE)

      Interest income                            4,267          3,780          8,592           5,934          23,619
      Gain (loss) on sale of assets                  -              -              -               -       2,496,986
      Gain on settlement of debt                     -              -              -               -          23,936
      Interest expense                          (8,979)        (8,979)       (17,860)        (17,860)     (8,958,780)
                                          ------------   ------------   ------------   -------------   -------------

            Total Other Income (Expense)        (4,712)        (5,199)        (9,268)        (11,926)     (6,414,239)
                                          ------------   ------------   ------------   -------------   -------------

INCOME (LOSS) BEFORE
   INCOME TAXES                               (127,699)       (30,612)      (266,947)        (71,145)     (7,364,312)

      Income tax expense                             -              -              -               -         116,883
                                          ------------   ------------   ------------   -------------   -------------

INCOME (LOSS) BEFORE
   DISCONTINUED OPERATIONS                    (127,699)       (30,612)      (266,947)        (71,145)     (7,481,195)

      (Loss) from discontinued
         operations                                  -              -              -               -     (50,192,296)
                                          ------------   ------------   ------------   -------------   -------------

NET INCOME (LOSS)                         $   (127,699)  $    (30,612)  $   (266,947)  $     (71,145)  $ (57,673,491)
                                          ============   ============   ============   =============   =============

BASIC AND DILUTED LOSS PER
   SHARE

      Income (loss) before discontinued
         operations                       $      (0.00)  $      (0.00)  $      (0.00)  $       (0.00)
      Discontinued operations                     0.00           0.00           0.00            0.00
                                          ------------   ------------   ------------   -------------

            Net income (loss)             $      (0.00)  $      (0.00)  $      (0.00)  $       (0.00)
                                          ============   ============   ============   =============

WEIGHTED AVERAGE NUMBER
   OF SHARES OUTSTANDING                    56,182,746     56,182,746     56,182,746      56,182,746
                                          ============   ============   ============   =============
</TABLE>

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

                                       3
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
            Consolidated Statements of Stockholders' Equity (Deficit)

<TABLE>
<CAPTION>
                                                                                               Deferred       Deficit
                                                                                              Consulting    Accumulated
                                            Common Stock       Additional        Other         Expense       During the
                                       ---------------------    Paid-In      Comprehensive    and Asset     Development
                                         Shares      Amount     Capital      Income (Loss)    Acquisition      Stage
                                       ----------  ---------  ------------  ---------------  ------------  --------------
<S>                                    <C>         <C>        <C>           <C>              <C>           <C>
Balance, December 31, 2006             56,182,746    561,827    35,169,137                -             -     (57,406,544)

Net income for the six months ended
   June 30, 2007 (Unaudited)                    -          -             -                -             -        (266,947)
                                       ----------  ---------  ------------  ---------------  ------------  --------------

Balance, June 30, 2007 (Unaudited)     56,182,746  $ 561,827  $ 35,169,137  $             -  $          -  $  (57,673,491)
                                       ==========  =========  ============  ===============  ============  ==============
</TABLE>

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

                                       4
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
                Consolidated Statements of Cash Flows (Unaudited)

<TABLE>
<CAPTION>
                                                                                                    From
                                                                                                Inception on
                                                                  For the Six Months Ended       March 26,
                                                                           June 30,             1992 Through
                                                                  ------------------------        June 30,
                                                                     2007           2006            2007
                                                                  ----------     ---------     -------------
<S>                                                               <C>            <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES

   Net loss                                                       $ (266,947)    $ (71,145)    $ (57,673,491)
   Adjustments to reconcile net loss to net
      cash used by operating activities:
         Depreciation and amortization                                     -             -         2,820,779
         Deferred consulting expense                                       -             -         2,486,798
         Value of common stock, warrants, options
            and discounts on equity instruments issued
            for services                                                   -             -         7,962,847
         Loss on sale of assets                                            -             -           387,649
         Amortization of debenture discount and debt issue costs           -             -         4,628,538
         Gain on disposition of debt and write off of subsidiary           -             -        (6,109,475)
         Gain on sale of assets                                            -             -        (2,496,986)
         Impairment loss                                                   -             -        12,302,123
   Change in operating asset and liability accounts,
      net of amounts acquired in business combination:
         (Increase) decrease in advances to employees,
            prepaid expenses, deposits and debt offering costs             -             -        (5,772,221)
         Increase (decrease) in accounts payable                     227,228        49,549         5,833,121
         Increase (decrease) in accrued expenses                      17,860        17,860        13,812,332
                                                                  ----------     ---------     -------------

               Net Cash Used by Operating Activities                 (21,859)       (3,736)      (21,817,986)
                                                                  ----------     ---------     -------------

CASH FLOWS FROM INVESTING ACTIVITIES

   Cash lost in discontinued operation                                     -             -            (4,713)
   Payments on license agreement                                           -             -          (400,000)
   Cash acquired in Sigma acquisition                                      -             -           142,254
   Proceeds from sale of assets                                            -       650,000           853,501
   Purchase of fixed assets                                                -             -        (1,164,570)
   Equipment procurement costs                                             -             -          (564,110)
                                                                  ----------     ---------     -------------

               Net Cash Provided (Used) by Investing Activities            -       650,000        (1,137,638)
                                                                  ----------     ---------     -------------

CASH FLOWS FROM FINANCING ACTIVITIES

   Proceeds from notes payable                                             -             -         4,951,818
   Repayment of related party notes payable                                -             -        (1,640,226)
   Repayment of notes payable                                              -             -        (1,519,062)
   Loans from related parties                                              -             -         7,462,787
   Issuance of convertible debentures                                      -             -         3,100,000
   Common stock issued for cash                                            -             -        11,256,032
   Stock offering costs                                                    -             -           (26,289)
                                                                  ----------     ---------     -------------

               Net Cash Provided by Financing Activities                   -             -        23,585,060
                                                                  ----------     ---------     -------------
</TABLE>

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

                                       5
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
          Consolidated Statements of Cash Flows (Unaudited) (Continued)

<TABLE>
<CAPTION>
                                                                                                   From
                                                                                               Inception on
                                                                  For the Six Months Ended       March 26,
                                                                          June 30,             1992 Through
                                                                  ------------------------        June 30,
                                                                     2007          2006            2007
                                                                  ---------     ----------     -------------
<S>                                                               <C>           <C>            <C>
NET INCREASE (DECREASE) IN CASH                                   $ (21,859)    $  646,264     $     629,436

CASH AT BEGINNING OF PERIOD                                         651,295          4,069                 -
                                                                  ---------     ----------     -------------

CASH AT END OF PERIOD                                             $ 629,436     $  650,333     $     629,436
                                                                  =========     ==========     =============

CASH PAID FOR:

   Interest                                                       $       -     $        -     $      16,488
   Income taxes                                                   $       -     $        -     $           -

NON-CASH FINANCING ACTIVITIES

   Value of common stock, warrants, options and
      discounts on equity instruments issued for services         $       -     $        -     $   7,962,847
   Equity instruments issued for deferred consulting
      expense/asset acquisition                                   $       -     $        -     $     740,000
   Common stock issued for recapitalization                       $       -     $        -     $   2,761,773
   Common stock issued for conversion of debt                     $       -     $        -     $   2,963,511
   Acquisition of licenses through license agreement
      Payable                                                     $       -     $        -     $   6,940,000
   Warrants granted in conjunction with debt instruments          $       -     $        -     $   3,261,386
</TABLE>

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

                                       6
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
              Notes to Unaudited Consolidated Financial Statements
                                  June 30, 2007

NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION

       The accompanying  unaudited  consolidated  financial statements have been
       prepared by the  Company  pursuant  to the rules and  regulations  of the
       Securities  and Exchange  Commission.  Certain  information  and footnote
       disclosures   normally  included  in  financial  statements  prepared  in
       accordance  with  generally  accepted  accounting  principles  have  been
       condensed or omitted in accordance with such rules and  regulations.  The
       information  furnished in the interim  consolidated  financial statements
       includes  normal  recurring  adjustments  and reflects  all  adjustments,
       which,   in  the  opinion  of  management,   are  necessary  for  a  fair
       presentation of such financial  statements.  Although management believes
       the  disclosures  and  information  presented  are  adequate  to make the
       information   not   misleading,   it  is  suggested  that  these  interim
       consolidated  financial  statements  be  read  in  conjunction  with  the
       Company's  most recent  audited  financial  statements  and notes thereto
       included in its December 31, 2006 Annual Report on Form 10-KSB. Operating
       results  for the six  months  ended  June 30,  2007  are not  necessarily
       indicative  of the  results  that may be  expected  for the  year  ending
       December 31, 2007.

       On December 1, 2002, the Company filed a voluntary petition under Chapter
       11 of the  bankruptcy  code  with  the  United  States  Bankruptcy  Court
       Southern  District of New York. See Note 5 for the  discussion  regarding
       the bankruptcy filing.

NOTE 2 - ACCRUED EXPENSES

       The Company's accrued expenses are comprised of the following items:

                                                                     June 30,
                                                                       2007
                                                                  --------------
                                                                   (Unaudited)

       Accrued payroll taxes payable                              $       60,266
       Accrued interest payable - payroll                                 52,717
       Accrued payroll tax penalty                                        98,845
       Accrued taxes payable                                             277,624
       Accrued payroll payable                                         2,103,656
       Aquamax/Keeran license fee payable                              3,600,000
       Accrued STM license fee payable                                 2,000,000
       Due to third parties                                               35,550
       Accrued legal settlement - Mchargue                                66,683
       Accrued interest payable                                        1,520,340
       Accrued contingency for additional post
          Petition claims                                                222,411
                                                                  --------------

             Total                                                $   10,038,092
                                                                  ==============

NOTE 3 - GOING CONCERN

       The Company's financial  statements are prepared using generally accepted
       accounting  principles  applicable to a going concern which  contemplates
       the  realization  of assets and  liquidation of liabilities in the normal
       course  of  business.  The  Company  has  had  limited  activities  since
       inception and is considered a development stage company because it has no
       operating  revenues,  and  planned  principal  operations  have  not  yet
       commenced.

       The Company has incurred losses from its inception  through June 30, 2007
       of  approximately  $57,673,491.  The Company does not have an established
       source of funds  sufficient to cover its operating  costs,  has a working
       capital deficit of approximately  $21,942,000,  has relied exclusively on
       debt  and  equity  financing.  Additionally  the  Company's  wholly-owned
       subsidiary  Sigma was forced into  bankruptcy  because of  non-payment of
       employee  salaries.  Accordingly,  there is  substantial  doubt about its
       ability to continue as a going concern.

                                       7
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
              Notes to Unaudited Consolidated Financial Statements
                                  June 30, 2007

NOTE 3 - GOING CONCERN (Continued)

       In October  of 2006,  the  Company  signed a term sheet with a company to
       sponsor a plan of reorganization. Prior to confirmation of the Chapter 11
       plan of reorganization, the plan sponsor will identify a merger candidate
       to be merged  into the  Company.  Before the merger can take  place,  the
       Company is  required to bring all of its  financial,  tax and SEC filings
       current  from the last filing date of 6/30/02.  Pursuant to orders of the
       United States Bankruptcy Court for the Southern District of New York, the
       Company has  engaged  accountants,  auditors  and SEC counsel to complete
       this task. Under the terms of the proposed plan, creditors of the Company
       will  receive a cash  payment and stock  consideration  in the new merged
       entity. The aforementioned consideration will be distributed to creditors
       of the Company under the plan of reorganization.

       The ability of the Company to  continue as a going  concern is  dependent
       upon its ability to  successfully  accomplish  the plan  described in the
       preceding  paragraph and eventually  attain  profitable  operations.  The
       accompanying   consolidated  financial  statements  do  not  include  any
       adjustments  that might be necessary if the Company is unable to continue
       as a going concern.

NOTE 4 - DILUTIVE INSTRUMENTS

       a. Stock Options

       The Company had  outstanding  stock options to purchase  87,132 shares of
       the Company's  common stock to  non-employees  as of June 30, 2007. These
       options expire in January 2012.

       The following table summarizes  information  about employee stock options
       outstanding at June 30, 2006:

                Number of         Weighted
                 Options          Average        Weighted         Number of
               Outstanding       Remaining        Average      Exercisable at
 Exercise        June 30,       Contractual      Exercise         June 30,
  Price            2006            Life           Price            2006
----------    -------------    -------------    ----------    ----------------

$     1.00        3,007,456       4.50 years    $     1.00           3,007,456
$     0.05          387,694       5.00 years    $     0.05             387,694

       Had compensation  cost for the Company's  stock-based  compensation  plan
       been  determined  based on the fair  value at the grant  dates for awards
       under  such  plan  consistent  with the  method  of FASB  Statement  123,
       "Accounting  for  Stock-Based  Compensation,"  the  Company's  net income
       (loss) and  earnings  (loss) per share would have been reduced to the pro
       forma amounts indicated below:

                       For the Three Months Ended    For the Six Months Ended
                                 June 30,                      June 30,
                       ---------------------------   --------------------------
                            2007           2006          2007           2006
                       ------------   ------------   ------------   -----------
                        (Unaudited)    (Unaudited)    (Unaudited)   (Unaudited)

Net income (loss) as
   reported            $   (127,699)  $    (30,612)  $   (266,947)  $   (71,145)
Proforma                   (127,699)       (30,612)      (266,947)      (71,145)
Basic and diluted
   income (loss) per
   share as reported          (0.00)         (0.00)         (0.00)        (0.00)
Pro forma                     (0.00)         (0.00)         (0.00)        (0.00)

                                       8
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
              Notes to Unaudited Consolidated Financial Statements
                                  June 30, 2007

NOTE 4 - DILUTIVE INSTRUMENTS (Continued)

       There were no stock options  granted during the six months ended June 30,
       2007.

       b. Warrants

       A summary of the Company's  outstanding warrants as of June 30, 2007, and
       changes during the six months then ended is presented below:

                                                                      Weighted
                                                                       Average
                                                                      Exercise
                                                   Shares              Price
                                                -----------          ----------
          Outstanding, December 31, 2006          3,554,944          $     0.74

          Granted                                         -                   -
          Expired/Cancelled                      (3,554,944)              (0.74)
          Exercised                                       -                   -
                                                -----------          ----------

          Outstanding, June 30, 2007                      -          $        -
                                                ===========          ==========

          Exercisable, June 30, 2007                      -          $        -
                                                ===========          ==========

NOTE 5 - BANKRUPTCY

       In September 2002, the Company was without sufficient capital to continue
       to  operate  and had  been  unable  to  identify  sources  of  additional
       financing.  The Board of  Directors of the Company was  concerned  that a
       sudden  cessation  of  operations  would not  provide  the best  means to
       maximize  asset values.  Therefore,  at an October 3, 2002 meeting of the
       Company's Board of Directors, the Board approved a resolution to commence
       negotiations  with the Company's  secured  creditors,  Algonquin  Capital
       Management, L.L.C. and Hibernia Capital Management, L.L.C., to commence a
       voluntary  bankruptcy  filing under chapter 11 of the Bankruptcy Code and
       immediately thereafter a sale of the Company's assets pursuant to section
       363 of the Bankruptcy Code.

       The Company has a history of being financed  primarily by raising capital
       through private  placements of its stock and/or loans from third parties.
       The proceeds from the  financing  have been used to develop the Company's
       technologies,  pursue  acquisitions and make strategic  alliances and pay
       operating costs. Over the past twelve months,  the Company has endeavored
       to stem severe cash flow shortages through, among other things, workforce
       and  overhead   reductions,   and  the   consolidation  of  its  business
       operations.  Due to persistent cash flow shortages the Company terminated
       substantially  all of its  employees.  As a  result  of a  confluence  of
       events,  including a general  contraction  of  available  financing  from
       capital   markets   and  the  recent   bankruptcy   in  Norway  of  Sigma
       Elektroteknisk,  AS, a wholly owned  subsidiary,  at a Special Meeting of
       the Board of  Directors  on  November  27,  2002,  the Board  unanimously
       consented to authorizing  the Company to file a voluntary  petition under
       Chapter 11 of the Bankruptcy Code.

       On December 1, 2002, the Company filed a voluntary petition under Chapter
       11 of the  bankruptcy  Code  with  the  United  States  Bankruptcy  Court
       Southern  District of New York.  On December 16, 2002,  the United States
       Trustee appointed a creditors'  committee  pursuant to section 1102(a) of
       the Bankruptcy Code (the "Committee").

       Simultaneously with filing the Chapter 11 petition,  the Company filed an
       emergency  motion to authorize  it to obtain  loans and advances  under a
       Debtor-In-Possession  Loan Agreement with Algonquin  Capital  Management,
       L.L.C. in order to continue  operations so that the Company could attempt
       to maximize  the value of its assets.  The  Bankruptcy  Court  entered an
       interim order approving the financing on December

                                       9
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
              Notes to Unaudited Consolidated Financial Statements
                                  June 30, 2007

NOTE 5 - BANKRUPTCY (Continued)

       5, 2002 and a final order was entered on December 20, 2002.  In addition,
       the Company filed a motion in the bankruptcy case to approve the proposed
       sale of substantially all of its assets to Algonquin Capital  Management,
       L.L.C. and Hibernia  Capital  Management,  L.L.C.,  subject to higher and
       better offers.  By order dated  February 6, 2003,  the  Bankruptcy  Court
       authorized the asset sale agreement  with  Algonquin  Capital  Management
       L.L.C. and Hibernia Capital Management L.L.C. as modified by the Creditor
       Settlement  Agreement and assumption and assignment of certain  executory
       contracts,  licenses and intellectual property rights for a credit bid of
       $2,000,000.  As  part of the  Creditor  Settlement  Agreement,  Algonquin
       Capital   Management  L.L.C.  and  Hibernia  Capital   Management  L.L.C.
       reconveyed to the  bankruptcy  estate a 60% ownership in the Water Assets
       of the  Company.  The Bill of Sale  consummating  the sale was  signed on
       February 19, 2003. During September 2003, an additional  $80,000 was paid
       to the Company by PowerPlay  Energy  pursuant to the creditor  settlement
       agreement.

       Having  sold its assets and ceased  operations,  the Company was not in a
       financial  position to support the on-going  operations needed to develop
       the Water Assets. On May 20, 2003, the Bankruptcy Court approved the sale
       of the  Company's  interest  in the Water  Assets  to Oases  Desalination
       International, Ltd. in exchange for their covenant to commercialize those
       assets and make certain royalty  payments.  Since that time, and although
       they have  made  certain  minimal  payments,  Oases has been in  default.
       Subsequently,  Oases Desalination International,  Ltd. and ReEnergy Group
       entered  into an asset  purchase  agreement  in which Oases  Desalination
       International,  Ltd.  would sell all of its assets,  including  the Water
       Assets, to ReEnergy Group. Because Oases Desalination International, Ltd.
       is in default  with the  Company  and has not paid for the Water  Assets,
       Oases  Desalination  International,  Ltd.  and Renergy  Group  sought the
       Company's  consent  wherein  ReEnergy Group would  directly  purchase the
       Water  Assets  from the  Company.  After  significant  negotiations,  the
       Creditors' Committee, Oases Desalination International, Ltd. and ReEnergy
       Group  entered  into the  Consent  Agreement,  in order to,  among  other
       things,  provide the  Company's  consent to transfer  the Water Assets to
       ReEnergy  Group for a modified  consideration  of $750,000  for the Water
       Assets. On October 26, 2005, an application was filed with the Bankruptcy
       Court to approve this  arrangement  and the  arrangement  was approved by
       order dated  November 16, 2005. The Company has received all of the funds
       in this  transaction  and is  being  held  in an  account  maintained  by
       bankruptcy counsel for the Committee.

       In October of 2006,  the Company  signed a term sheet with Trinad Capital
       Master Fund Ltd. (the Sponsor) to sponsor a plan of reorganization. Prior
       to  confirmation  of the Chapter 11 plan of  reorganization,  the Sponsor
       will  identify a merger  candidate  to be merged  into the  Company.  The
       Sponsor   is   currently   in   negotiations   with   NorthStar   Systems
       International,  Inc. as the potential merger candidate. Before the merger
       can take place,  the  Company is required to bring all of its  financial,
       tax and SEC filings  current  from the last filing date of June 30, 2002.
       Pursuant to orders of the United States Bankruptcy Court for the Southern
       District of New York, the Company has engaged  accountants,  auditors and
       SEC counsel to complete this task.  Under the terms of the proposed plan,
       creditors  of the Company  will receive a pro rata cash payment and stock
       consideration in the new merged entity. The aforementioned  consideration
       will be  distributed  to creditors of the Company under the proposed plan
       of reorganization.

NOTE 6 - SALE OF ASSETS

       During the six months ending June 30, 2003, the Company filed a motion in
       the bankruptcy case to approve the proposed sale of substantially  all of
       its assets to Algonquin Capital  Management,  L.L.C. and Hibernia Capital
       Management,  L.L.C.,  subject to higher and better offers. By order dated
       February  6,  2003,  the  Bankruptcy  Court  authorized  the  asset  sale
       agreement with Algonquin  Capital  Management L.L.C. and Hibernia Capital
       Management  L.L.C. as modified by the Creditor  Settlement  Agreement and
       assumption and assignment of certain  executory  contracts,  licenses and
       intellectual  property rights for a credit bid of $2,000,000.  As part of
       the Creditor  Settlement  Agreement,  Algonquin Capital Management L.L.C.
       and Hibernia  Capital  Management  L.L.C.  reconveyed  to the  bankruptcy
       estate a 60%  ownership in the Water  Assets of the Company.  The Bill of
       Sale consummating the sale was signed on February 19, 2003. As a

                                       10
<PAGE>

                    OCEAN POWER CORPORATION AND SUBSIDIARIES
                          (A Development Stage Company)
              Notes to Unaudited Consolidated Financial Statements
                                  June 30, 2007

NOTE 6 - SALE OF ASSETS (Continued)

       result of this asset sale the Company recognized a gain on sale of assets
       in the amount of $1,723,486. The Company had no basis in the water assets
       prior  to the  original  sale  and  therefore  recognized  no gain on the
       subsequent return of those assets.

       During  the  quarter  ended  December  31,  2005,  the  Company  sold its
       ownership  interest  in the  water  assets  pursuant  to an  order  dated
       November 16, 2005, by the United States Bankruptcy Court for the Southern
       District of New York. As  consideration  for this ownership  interest the
       Company   received   total  cash  proceeds  of  $750,000  paid  in  three
       installments.  The first two installments were made prior to December 31,
       2005,  and totaled  $100,000.  The  remaining  $650,000 was recorded as a
       receivable  balance at December 31, 2005, and was  subsequently  received
       during January 2006.

NOTE 7 - DEBTOR-IN-POSSESSION FINANCING

       During the six months ending June 30, 2003, the Company received $136,818
       from   the   issuance   of   notes   and    advances    pursuant   to   a
       debtor-in-possession financing facility, approved pursuant to an order by
       the United States Bankruptcy Court for the Southern District of New York.
       The applicable interest rate was 15%.

NOTE 8 - SUBSEQUENT EVENT

       During  August 2007 the Company  entered into a  settlement  agreement in
       connection  with the  debtor-in-possession  financing  whereby  the total
       balance of  principal  and  accrued  interest  was settled for a one time
       payment of $380,000. As a result of the settlement the Company recognized
       a gain on settlement of debt of approximately $21,700.

                                       11
<PAGE>
Item 2. Management's Discussion and Analysis of Results of Operations

Readers should refer to the  description of the Company's  bankruptcy  case (the
"Bankruptcy Case") described in the Notes to the Financial  Statements  included
in Item 1 of this Form  10-QSB and in the  Company's  Form 10-KSB for the annual
period ended December 31, 2006.

Three Month Periods Ended June 30, 2007 and 2006
------------------------------------------------

The business of the Company during the quarter ended June 30, 2007 included only
its consideration of various plan of reorganization  opportunities and incurring
administrative expenses in connection with the Bankruptcy Case, e.g., related to
legal,    accounting   and    administrative    activities.    There   were   no
revenue-generating  activities. The Company has had no employees since 2003. The
administrative  activities of the Company are  performed by outside  consultants
and advisors. Direct administrative expenses of the Company totaled $122,987 and
$25,413 for the three-month periods ended June 30, 2007 and 2006,  respectively.
The increase in the current period compared to the same period in the prior year
is due primarily to legal,  auditing and consulting fees as the Company attempts
to complete and exit bankruptcy and bring its filings current with the SEC.

Six Month Periods Ended June 30, 2007 and 2006
----------------------------------------------

The business of the Company  during the six months ended June 30, 2007  included
only its  consideration  of various  plan of  reorganization  opportunities  and
incurring  administrative expenses in connection with the Bankruptcy Case, e.g.,
related  to legal,  accounting  and  administrative  activities.  There  were no
revenue-generating  activities. The Company has had no employees since 2003. The
administrative  activities of the Company are  performed by outside  consultants
and advisors. Direct administrative expenses of the Company totaled $257,679 and
$59,219 for the six-month  periods  ended June 30, 2007 and 2006,  respectively.
The increase in the current period compared to the same period in the prior year
is due primarily to legal,  auditing and consulting fees as the Company attempts
to complete and exit bankruptcy and bring its filings current with the SEC.

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

Primary sources of liquidity since the Company ceased  operations have been cash
balances that have been used to pay administrative expenses.  Operating expenses
of the Company have been funded with  available cash retained from the two asset
sales effected as part of the  Bankruptcy  Case. As of the date of the filing of
this Form 10-QSB with the SEC, cash totals approximately $227,210. Based on such
balance and  management's  forecast of activity levels during the period that it
may remain  without  operations,  the  Company is  uncertain  as to whether  the
present cash balance will be sufficient to pay its current  liabilities  and its
administrative  expenses as such expenses become due; provided that, if the Plan
is  confirmed,  the Company  believes  that the  present  cash  balance  will be
sufficient to pay its current  liabilities  and its  administrative  expenses as
such expenses become due.


Uncertainties Relating to Forward Looking Statements
----------------------------------------------------

"Item 2.  Management's  Discussion  and Analysis or Plan of Operation" and other
parts of this Form 10-QSB contain certain  "forward-looking  statements"  within
the  meaning  of the  Securities  Act of 1934,  as  amended.  While the  Company
believes  any  forward-looking  statements  it has made are  reasonable,  actual
results  could  differ  materially  since the  statements  are based on  current
management expectations and are subject to risks and uncertainties.  These risks
and uncertainties include, but are not limited, to the following:

      o     There can be no assurance that the plan of reorganization filed with
            the United States  Bankruptcy Court for the Southern District of New
            York ("Bankruptcy  Court") on January 15, 2008, or any other plan of
            reorganization,  will  be  approved  by  the  Bankruptcy  Court  and
            effected.

      o     There can be no assurance  that Trinad Capital Master Fund Ltd. (the
            "Plan Sponsor") will reach agreement on definitive documentation for
            a merger with NorthStar Systems International Inc. ("NorthStar"), or
            any other potential merger candidate.

      o     Even if a plan of reorganization is approved by the Bankruptcy Court
            and effected,  there can be no assurance as to the terms of any such
            plan, including without limitation as to the distributions,  if any,
            to be made to existing creditors and stockholders of the Company.

                                       12
<PAGE>

      o     The Plan Sponsor may withdraw at any time prior to confirmation of a
            plan  of  reorganization,   including  without  limitation,  due  to
            unsatisfactory  results of its due diligence on  NorthStar.  In such
            event,  the Company may  substitute  the Plan  Sponsor  with another
            person or entity  offering  to  purchase  stock in the newly  merged
            entity under the plan of reorganization on terms and conditions that
            may not be the same, or as  economically  favorable to the Company's
            estate,  as those are being  offered  by the Plan  Sponsor.  In such
            event,  the  recovery  for  unsecured   creditors  would  likely  be
            dramatically reduced.

      o     No public  market exists for stock in the merged  entity,  and it is
            not anticipated that any will necessarily develop in the foreseeable
            future.  Therefore,  notwithstanding the legal ability to trade such
            stock,  any  recipient  thereof  should expect that it might have to
            hold the stock for an indefinite period of time.

Item 3. Controls and Procedures

(a) Evaluation of disclosure controls and procedures.

Our management,  with the  participation of our principal  executive officer and
principal  financial officer,  has evaluated the effectiveness of the design and
operation  of our  disclosure  controls  and  procedures  (as  defined  in Rules
13a-15(e) and 15d-15(e)  under the Securities  Exchange Act of 1934, as amended)
as of the end of the period  covered  by this  quarterly  report.  Based on this
evaluation,  our principal  executive  officer and principal  financial  officer
concluded  that these  disclosure  controls and  procedures  are  effective  and
designed to ensure that the information  required to be disclosed in our reports
filed or  submitted  under  the  Securities  Exchange  Act of 1934 is  recorded,
processed, summarized and reported within the requisite time periods.

(b) Changes in internal controls.

There was no change in our internal control over financial reporting (as defined
in Rules 13a-15(f) and 15d-15(f)  under the Securities  Exchange Act of 1934, as
amended)  identified in connection  with the evaluation of our internal  control
performed  during the quarter ended June 30, 2007 that has materially  affected,
or is  reasonably  likely  to  materially  affect,  our  internal  control  over
financial reporting.

                           PART II - OTHER INFORMATION

Item 6. Exhibits

Exhibits  filed  herewith  are  set  forth  in the  Index  to  Exhibits  and are
incorporated herein by reference.

                                   SIGNATURES

In accordance with the requirements of the Securities  Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


        /s/ MICHAEL HOPPER
        -----------------------------
Name:   Michael Hopper
Title:  Authorized Signatory
Date:   January 31, 2008

                                       13
<PAGE>

                                INDEX TO EXHIBITS

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

31.01     Certification  pursuant to 15 U.S.C.  78m(a) or 78o(d) (Section 302 of
          the Sarbanes Oxley Act of 2002).**

32.01     Certification  pursuant to 18 U.S.C. Section 1350, as adopted pursuant
          to Section 906 of the Sarbanes-Oxley Act of 2002.**

**        Filed herewith.