[As adopted in Release No. 34-32231, April 28, 1993, 58 F.R. 26509]

                     U.S. 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: March 31, 2007
                                                -----------------

             [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE
                                  EXCHANGE ACT

                        For the transition period from to
                        Commission file number 333-102930

                            Silver Star Energy, Inc.
                           --------------------------
                     (Exact name of small business issuer as
                            specified in its charter)

                                Nevada 90-0220668
                               -------------------
                   (State or other jurisdiction (IRS Employer
              of incorporation or organization) Identification No.)

       9595 Wilshire Boulevard, Suite 900, Beverly Hills, California 90212
      ---------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (310) 477-2211
                            Issuer's telephone number


               (Former name,  former  address and former fiscal year, if changed
since last report.)

         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  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 by Rule 12b-2 of the Exchange Act). Yes [ ] No [ X ]





<PAGE>



                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDING DURING THE PRECEDING FIVE YEARS

         Check whether the registrant  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 [] No []


                      APPLICABLE ONLY TO CORPORATE ISSUERS

         State the number of shares  outstanding of each of the issuer's classes
of common equity,  as of the latest  practical  date:  March 31, 2007 96,221,035


         Transitional  Small Business  Disclosure Format (check one).
Yes []; No [X]


<PAGE>



                                     PART I

ITEM 1.  FINANCIAL STATEMENTS

                            SILVER STAR ENERGY, INC.
                                 BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                  (Unaudited)
                                                                                   March 31,       December 31,
ASSETS                                                                               2007               2006
                                                                              ------------------  -----------------
Current Assets
<S>                                                                           <C>                 <C>
  Cash                                                                        $              559  $          31,533
  Accounts Receivable                                                                    429,108            455,168
  Prepaid Expense                                                                         85,638              5,000
 Other Receivable                                                                        159,472            255,218
                                                                              ------------------  -----------------

     Total Current Assets                                                                674,777            746,919
                                                                              ------------------  -----------------

Fixed Assets
  Furniture and Fixtures                                                                   7,751              7,751
  Computers                                                                                6,222              6,222
  Vehicles                                                                                64,087             64,087
   Accumulated Depreciation                                                              (32,105)           (27,994)
                                                                              ------------------  -----------------

     Net Fixed Assets                                                                     45,955             50,066
                                                                              ------------------  -----------------

Other Assets
  Oil and gas properties, full cost method, net of depletion of
    $659,633 and $544,633, respectively                                                3,258,034          3,373,034
   Unproved oil and gas properties                                                       627,375            627,375
  Debt Issue Costs, net of amortization of $343,364 and $282,706                         136,835            197,494
                                                                              ------------------  -----------------

     Total Other Assets                                                                4,022,244          4,197,903
                                                                              ------------------  -----------------


     Total Assets                                                             $        4,742,976  $       4,994,888
                                                                              ==================  =================
</TABLE>













                                        3

<PAGE>



                            SILVER STAR ENERGY, INC.
                                 BALANCE SHEETS
                                   (Continued)


<TABLE>
<CAPTION>
                                                                                (Unaudited)
                                                                                 March 31,          December 31,
                                                                                   2007                 2006
                                                                            -------------------  ------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
<S>                                                                         <C>                  <C>
  Accounts Payable                                                          $            91,677  $           92,067
  Accrued Liabilities                                                                    20,070              33,442
  Convertible debentures - current portion                                            3,430,000           3,430,000
  Accrued interest                                                                      965,895             795,335
                                                                            -------------------  ------------------

     Total Current Liabilities                                                        4,507,642           4,350,844
                                                                            -------------------  ------------------

Long-Term Liabilities
  Asset retirement obligation                                                            60,000              60,000
  Derivative liability                                                                  279,074             279,074
                                                                            -------------------  ------------------

     Total Long-Term Liabilities                                                        339,074             339,074
                                                                            -------------------  ------------------

      Total Liabilities                                                               4,846,716           4,689,918
                                                                            -------------------  ------------------

Stockholders' Equity
  Preferred stock (Par Value $.001), 5,000,000 shares
    authorized. -0- issued at March 31, 2007 and
    December 31, 2006                                                                         -                   -
  Common Stock (Par Value $.001), 300,000,000 shares
    authorized. 96,221,035 issued and outstanding at
    March 31, 2007 and December 31, 2006                                                 96,221              96,221
  Paid in Capital in Excess of Par Value                                              6,119,457           6,119,457
  Retained Deficit                                                                   (6,319,418)         (5,910,708)
                                                                            -------------------  ------------------

     Total Stockholders' Equity                                                        (103,740)            304,970
                                                                            -------------------  ------------------

     Total Liabilities and Stockholders' Equity                             $         4,742,976  $        4,994,888
                                                                            ===================  ==================
</TABLE>






                             See accompanying notes.

                                        4

<PAGE>



                            SILVER STAR ENERGY, INC.
                            STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>
                                                         (Unaudited)
                                                  For the Three Months Ended
                                                           March 31,
                                            --------------------------------------
                                                  2007              2006
                                            -----------------  -------------------
<S>                                         <C>                <C>
Oil Revenue                                 $          50,852  $            91,570
Gas Revenue                                           614,011              505,754
                                            -----------------  -------------------
   Total Income                             $         664,863  $           597,324
                                            -----------------  -------------------

Expenses
  Production Costs                                    192,509              170,095
  Consulting and Management Fees                      342,083              195,825
  General and Administrative                          178,795              183,569
  Professional Fees                                   129,058               78,041
                                            -----------------  -------------------
     Total Expenses                                   842,445              627,530
                                            -----------------  -------------------

Other Income ( Expense)
   Interest Expense                                  (128,228)            (130,818)
   Interest Income                                          -                1,552
   Financing Penalty Payouts                         (102,900)             (68,600)
                                            -----------------  -------------------
     Total Other Income (Expense)                    (231,128)            (197,866)
                                            -----------------  -------------------


Net Income (Loss)                           $        (408,710) $          (228,072)
                                            =================  ===================

Income (Loss) per Common Share              $               -  $                 -
                                            =================  ===================

Weighted Average Shares Outstanding                96,221,035           85,021,035
                                            =================  ===================
</TABLE>










                             See accompanying notes.

                                        5

<PAGE>



                            SILVER STAR ENERGY, INC.
                            STATEMENTS OF CASH FLOWS


<TABLE>
<CAPTION>
                                                                   (Unaudited)
                                                            For the Three Months Ended
                                                                    March 31,
                                                      --------------------------------------
                                                             2007                2006
                                                      ------------------  ------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                   <C>                 <C>
Net Loss                                              $         (408,710) $         (228,072)
Adjustments used to reconcile net loss to net
  cash provided by (used in) operating activities:
   Depreciation, Amortization and Depletion                      179,769             119,997
(Increase) decrease in other assets & prepaids                   (80,638)              3,004
(Increase) decrease in accounts receivable                      (133,412)            160,376
(Increase) decrease in other receivable                          255,218              27,000
Increase (decrease) in accounts payable                             (389)             23,043
Increase (decrease) in accrued interest                          170,561              74,565
Increase (decrease) in accrued liabilities                       (13,373)             66,318
                                                      ------------------  ------------------
Net cash used in operating activities                            (30,974)            246,231
                                                      ------------------  ------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of oil & gas property interests                            -          (1,224,906)
Proceeds on sale of Netcash (net of cash)                              -                   -
                                                      ------------------  ------------------
Net cash used by investing activities                                  -          (1,224,906)
                                                      ------------------  ------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from convertible debentures                                   -                   -
Proceeds from loans                                                    -                   -
Proceeds from shareholder loans                                        -                   -
Proceeds on sale of common stock                                       -                   -
                                                      ------------------  ------------------
Net Cash Provided by Financing  Activities                             -                   -
                                                      ------------------  ------------------
</TABLE>









                                        6

<PAGE>



                            SILVER STAR ENERGY, INC.
                            STATEMENTS OF CASH FLOWS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                          (Unaudited)
                                                                                   For the Three Months Ended
                                                                                           March 31,
                                                                             --------------------------------------
                                                                                    2007                2006
                                                                             ------------------  ------------------
Net Increase (Decrease) in
<S>                                                                                     <C>                <C>
   Cash  and Cash Equivalents                                                           (30,974)           (978,675)
Cash and Cash Equivalents at
   Beginning of the Period                                                               31,533           1,087,163
                                                                             ------------------  ------------------
Cash and Cash Equivalents at
   End of the Period                                                         $              559  $          108,488
                                                                             ==================  ==================

SUPPLEMENTAL DISCLOSURE OF CASH
  FLOW INFORMATION:
Interest                                                                     $                -  $                -
Income Taxes                                                                 $                -  $                -

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES: NONE
-----------
</TABLE>






















                             See accompanying notes.

                                        7

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN

         The accompanying  financial  statements have been prepared on the basis
of accounting principles applicable to a "going concern",  which assume that the
Company  will  continue in  operation  for at least one year and will be able to
realize  its assets  and  discharge  its  liabilities  in the  normal  course of
operations.

         The unaudited  financial  statements as of March 31, 2007,  and for the
three month  period  then ended,  reflect,  in the  opinion of  management,  all
adjustments  (which  include  only normal  recurring  adjustments)  necessary to
fairly  state the  financial  position and results of  operations  for the three
months.  Operating results for interim periods are not necessarily indicative of
the results which can be expected for full years.

         Several conditions and events cast doubt about the Company's ability to
continue  as  a  "going  concern".   The  Company  has  a  retained  deficit  of
approximately $6,000,000, and is in default of the October 14, 2005 terms of its
convertible  debenture.  As of  March  31,  2007,  the  Company  does  not  have
sufficient cash flow to repay the original  offering amount in cash.  Liquidated
damages  of 1% per month of the  amount of the  debentures  is  currently  being
accrued.  These factors raise  substantial  doubt about the Company's ability to
continue as a going concern. The Company is evaluating alternatives to repay the
convertible debenture.

         The  Company's  general  business  strategy  is to acquire  oil and gas
properties either directly or through the acquisition of operating entities. The
continued  operations  of the  Company  and  the  recoverability  of oil and gas
property  acquisition,  exploration and development  costs is dependent upon the
existence of economically recoverable reserves and the ability of the Company to
obtain  necessary  financing to complete the development of those reserves,  and
upon future profitable  production.  The Company is planning  additional ongoing
equity  financing  by way of  private  placements  to fund its  obligations  and
operations.

         The Company's future capital  requirements will depend on many factors,
including  costs of exploration of the  properties,  cash flow from  operations,
costs to complete well  production,  if warranted,  and  competition  and global
market conditions.

         These  financial  statements do not reflect  adjustments  that would be
necessary  if the Company  were unable to continue as a "going  concern".  While
management believes that the actions already taken or planned, will mitigate the
adverse conditions and events which raise doubt about the validity of the "going
concern" assumption used in preparing these financial  statements,  there can be
no assurance that these actions will be successful.

         If the  Company  were unable to  continue  as a "going  concern",  then
substantial adjustments would be necessary to the carrying values of assets, the
reported amounts of its liabilities, the reported revenues and expenses, and the
balance sheet classifications used.


                                        8

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN (continued)

Organization and Basis of Presentation

         Silver Star Energy,  Inc. (the "Company") was incorporated on September
25,  2002 in the State of Nevada and  commenced  operations  on October 3, 2002.
During the year ended  December  31,  2003,  the  Company  changed its name from
Movito Holdings Ltd. to Silver Star Energy Inc.

Nature of Business

         The Company is in the production stage of the oil and gas industry. The
Company's  primary  objective  is to identify,  acquire and develop  significant
working interest  percentages in underdeveloped oil and gas projects that do not
meet the  requirements of the larger  producers and developers.  During 2003 and
2004 the Company was in the development stage and acquired  interests in several
oil and gas prospects,  and in 2005 and 2006, has set up the extraction  process
and is further continuing that program.

NOTE 2 - SUMMARY OF ACCOUNTING POLICIES

         This summary of  accounting  policies  for Silver Star Energy,  Inc. is
presented to assist in understanding  the Company's  financial  statements.  The
accounting policies conform to generally accepted accounting principles and have
been consistently applied in the preparation of the financial statements.

Cash Equivalents

         For the purpose of  reporting  cash flows,  the Company  considers  all
highly liquid debt  instruments  purchased with maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.

Pervasiveness of Estimates

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

Concentration of Credit Risk

         The  Company has no  significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign hedging arrangements.

                                        9

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (continued)

Earnings per Share

         Basic loss per share has been  computed  by  dividing  net loss for the
year  applicable to the common  stockholders  by the weighted  average number of
shares  of  common  shares  outstanding  during  the  year.  Convertible  equity
instruments such as stock options,  warrants,  convertible  debentures and notes
payable are excluded  from the  computation  of diluted  loss per share,  as the
effect of the assumed exercises would be anti-dilutive.

Fixed Assets

         Fixed   assets  are  recorded  at  cost  and   depreciated   using  the
straight-line  method over the estimated  useful lives of the assets which range
from three to seven years.  Fixed assets consisted of the following at March 31,
2007 and December 31, 2006:

                                        (Unaudited)
                                         March 31,          December 31,
                                            2007                2006
                                     ------------------  ------------------
Furniture and Fixtures               $            7,751  $            7,751
Computers                                         6,222               6,222
Vehicles                                         64,087              64,087
Less: Accumulated Depreciation                  (32,105)            (27,994)
                                     ------------------  ------------------
Total                                $           45,955  $           50,066
                                     ==================  ==================

         One-half  year  depreciation  is taken in the  year of  acquisition  on
certain fixed assets.

         Maintenance  and  repairs are charged to  operations;  betterments  are
capitalized.  The  cost  of  property  sold  or  otherwise  disposed  of and the
accumulated  depreciation  thereon are eliminated  from the property and related
accumulated depreciation accounts, and any resulting gain or loss is credited or
charged to income.

         Total  depreciation  expense for the three  months ended March 31, 2007
and 2006 was $4,110 and $4,110, respectively.

Intangibles

         The  Company has adopted the  provisions  of the  Financial  Accounting
Standards  Board ("FASB")  Statement No. 142,  "Goodwill and Intangible  Assets"
("SFAS 142").  Under SFAS 142,  goodwill and intangible  assets with  indefinite
lives will no longer be amortized  and will be tested for  impairment  annually.
The  determination  of any  impairment  would  include a comparison of estimated
future operating cash flows  anticipated  during the remaining life with the net
carrying  value of the asset as well as a  comparison  of the fair  value to the
book value of the Company or the  reporting  unit to which the  goodwill  can be
attributed.

                                       10

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (continued)

Oil and Gas Properties

         The Company  follows the full cost method of accounting for its oil and
gas  properties.  Under this  method,  all costs  associated  with  acquisition,
exploration,  and  development of oil and gas properties are  capitalized.  Such
costs  include land and lease  acquisition  costs,  annual  carrying  charges of
non-producing  properties,  geological and geophysical  costs, costs of drilling
and equipping  productive and non-productive  wells, asset retirement costs, and
direct  exploration  salaries  and  related  benefits.   Capitalized  costs  are
categorized as being subject to amortization or not subject to amortization. The
Company operates in two cost centers, being Canada and the U.S.A.

         The  capitalized  costs of oil and gas  properties are amortized on the
unit-of-production  method using  estimates of proved  reserves as determined by
independent  engineers.  Investments  in unproved  properties  are not amortized
until  proved  reserves  associated  with  projects can be  determined  or until
impairment occurs. If the results of an assessment  indicate that the properties
are impaired,  the amount of the impairment is added to the capitalized costs to
be  amortized.  Depletion  expense for the three months ended March 31, 2007 and
2006 was $115,000 and $59,634, respectively.

         The Company applies a ceiling test to capitalized  costs to ensure that
such costs do not exceed estimated future net revenues from production of proven
reserves  at year end market  prices  less  future  production,  administrative,
financing,  site  restoration,  and  income  tax costs plus the lower of cost or
estimated  market  value  of  unproved  properties.  If  capitalized  costs  are
determined to exceed  estimated  future net  revenues,  a write-down of carrying
value is charged to depletion in the period.

         Proceeds  from the sale of oil and gas  properties  are  recorded  as a
reduction of the related capitalized costs without recognition of a gain or loss
unless such sales involve a significant change in the relationship between costs
and the value of proved reserves or the underlying value of unproved properties,
in which case a gain or loss is recognized.

         The Company is in the process of exploring its unproved oil and natural
gas  properties  and has not yet  determined  whether these  properties  contain
reserves that are economically recoverable.  The recoverability of amounts shown
for  oil  and  natural  gas  properties  is  dependent  upon  the  discovery  of
economically recoverable reserves, confirmation of the Company's interest in the
underlying  oil and gas leases,  the ability of the Company to obtain  necessary
financing to complete their  exploration and  development and future  profitable
production or sufficient proceeds from the disposition thereof.






                                       11

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (continued)

Asset Retirement Obligations

         Effective  January 1, 2003, the Company adopted  Statement of Financial
Accounting Standards No. 143, ACCOUNTING FOR ASSET RETIREMENT  OBLIGATIONS "SFAS
143"). This statement  applies to obligations  associated with the retirement of
tangible  long-lived  assets that result from the acquisition,  construction and
development of the assets.  SFAS 143 requires that the fair value of a liability
for a retirement  obligation  be recognized in the period in which the liability
is incurred.  For oil and gas properties,  this is the period in which an oil or
gas well is acquired or drilled. The asset retirement  obligation is capitalized
as part of the carrying  amount of our oil and gas  properties at its discounted
fair value.  The  liability is then  accreted each period until the liability is
settled or the well is sold, at which time the liability is reversed.

Fair Value of Financial Instruments

         In accordance  with the  requirements  of SFAS No. 107, the Company has
determined the estimated  fair value of financial  instruments  using  available
market information and appropriate  valuation  methodologies.  The fair value of
financial  instruments  classified as current assets or liabilities  approximate
carrying value due to the short-term maturity of the instruments.

Foreign currency transactions

         The financial  statements  are presented in United States  dollars.  In
accordance  with Statement of Financial  Accounting  Standards No. 52,  "Foreign
Currency  Translation",  foreign denominated monetary assets and liabilities are
translated  to their United  States dollar  equivalents  using foreign  exchange
rates that  prevailed  at the balance  sheet  date.  Revenue  and  expenses  are
translated at average  rates of exchange  during the year.  Related  translation
adjustments  are  reported  as a separate  component  of  stockholders'  equity,
whereas  gains or  losses  resulting  from  foreign  currency  transactions  are
included in results of operations.

Stock-based compensation

         Effective  January 1, 2006, the company  adopted the provisions of SFAS
No. 123(R).  SFAS No. 123(R) requires employee equity awards to be accounted for
under the fair value method.  Accordingly,  share-based compensation is measured
at grant date,  based on the fair value of the award.  Prior to January 1, 2006,
the company accounted for awards granted to employees under its equity incentive
plans under the intrinsic value method prescribed by Accounting Principles Board
(APB) Opinion No. 25,  "Accounting  for Stock Issued to Employees" (APB 25), and
related  interpretations,  and  provided  the  required  pro  forma  disclosures
prescribed by SFAS No. 123, "Accounting for Stock-Based  Compensation" (SFAS No.
123),  as amended.  No stock  options were granted to employees  during the year
ended December 31, 2006 or 2005 and  accordingly,  no  compensation  expense was
recognized  under APB No. 25 for the year ended  December  31, 2006 or 2005.  In
addition,  no compensation expense is required to be recognized under provisions
of SFAS No. 123(R) with respect to employees.

                                       12

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (continued)

         Under the modified  prospective method of adoption for SFAS No. 123(R),
the  compensation  cost  recognized by the company  beginning on January 1, 2006
includes (a) compensation cost for all equity incentive awards granted prior to,
but not yet vested as of January 1,  2006,  based on the  grant-date  fair value
estimated in  accordance  with the original  provisions of SFAS No. 123, and (b)
compensation cost for all equity incentive awards granted  subsequent to January
1, 2006,  based on the grant-date  fair value  estimated in accordance  with the
provisions of SFAS No. 123(R).  The company uses the  straight-line  attribution
method to recognize  share-based  compensation  costs over the service period of
the award.  Upon  exercise,  cancellation,  forfeiture,  or  expiration of stock
options,  or upon vesting or forfeiture of restricted stock units,  deferred tax
assets for options and  restricted  stock units with multiple  vesting dates are
eliminated  for each vesting  period on a first-in,  first-out  basis as if each
vesting  period was a  separate  award.  To  calculate  the excess tax  benefits
available  for  use in  offsetting  future  tax  shortfalls  as of the  date  of
implementation, the company followed the alternative transition method discussed
in FASB Staff Position No. 123(R)-3.

Recent accounting pronouncements

         In June,  2006 the FASB issued FIN 48,  "Accounting  for Uncertainty in
Income Taxes--an  interpretation of FASB Statement No. 109". This Interpretation
clarifies,  among other things,  the accounting for  uncertainty in income taxes
recognized in an  enterprise's  financial  statements  in  accordance  with FASB
Statement No. 109, Accounting for Income Taxes. This Interpretation prescribes a
recognition  threshold and  measurement  attribute  for the financial  statement
recognition and measurement of a tax position taken or expected to be taken in a
tax  return.  This  Interpretation  also  provides  guidance  on  derecognition,
classification,   interest  and  penalties,   accounting  in  interim   periods,
disclosure,  and  transition  is  effective  for fiscal  years  beginning  after
December 15, 2006.  Earlier  application is encouraged if the enterprise has not
yet issued financial statements,  including interim financial statements, in the
period the  Interpretation  is adopted.  FIN 48,  Accounting for  Uncertainty in
Income  Taxes--an  interpretation  of FASB  Statement  No. 109, is effective for
fiscal  years  beginning  after  December  15,  2006.  Earlier   application  is
encouraged if the enterprise has not yet issued financial statements,  including
interim  financial  statements,  in the period the  Interpretation  is  adopted.
Management is evaluating the financial impact of this pronouncement.

         In September  2006, the FASB issued SFAS No. 157,  "Accounting for Fair
Value  Measurements."  SFAS No.  157  defines  fair  value,  and  establishes  a
framework for measuring fair value in generally accepted  accounting  principles
and expandsdisclosure  about fair value measurements.  SFAS No. 157 is effective
for the Company for financial statements issued subsequent to November 15, 2007.
The Company does not expect the new standard to have any material  impact on the
financial position and results of operations.

         In September 2006, the staff of the Securities and Exchange  Commission
issued Staff Accounting Bulletin No. 108 ("SAB 108") which provides interpretive
guidance  on how  the  effects  of the  carryover  or  reversal  of  prior  year
misstatements  should be considered in quantifying a current year  misstatement.
SAB 108 becomes effective in fiscal 2007. Management is evaluating the financial
impact of this pronouncement.

                                       13

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (continued)

Revenue Recognition

         The  Company  recognizes  oil and gas  revenue  from its  interests  in
producing  wells as oil and gas is produced and sold from those  wells.  Oil and
gas sold is not significantly  different from the Company's share of production.
Revenues  from  the  purchase,  sale  and  transportation  of  natural  gas  are
recognized  upon  completion  of the  sale  and  when  transported  volumes  are
delivered.  Shipping and handling costs in connection  with such  deliveries are
included in  production  costs.  Revenue under  carried  interest  agreements is
recorded in the period when the net proceeds become  receivable,  measurable and
collection is reasonably  assured.  The time the net revenues become  receivable
and collection is reasonably  assured depends on the terms and conditions of the
relevant agreements and the practices followed by the operator. As a result, net
revenues may lag the production month by one or more months.

NOTE 3 - OIL AND GAS PROPERTIES

         The Company  entered into  agreements  to acquire  interests in various
unproven oil and gas properties as follows:

Alberta Prospects, Canada

         In October 2003, the Company  entered into two agreements  with 1048136
Alberta Ltd.  Pursuant to these  agreements,  the Company  acquired the right to
participate  and earn an interest in two oil and gas exploration and development
projects  located in the province of Alberta,  Canada known  respectively as the
Evi prospect and the Verdigris  prospect.  In February 2004, the Company entered
into  two  agreements  with  1048136  Alberta  Ltd.  to  acquire  the  right  to
participate  and earn an interest in two additional oil and gas  exploration and
development  projects  located in the  province of Alberta  known as the Joarcam
prospect  and the  Buffalo  Lake  prospect.  1048136  Alberta  Ltd. is a private
Alberta company (see Note 6).

         Pursuant  to the  agreements,  the  Company  shall  advance  funds,  as
required, in connection with the drilling, testing,  completion,  capping and/or
abandonment of up to three wells on each of the properties. Once the Company has
completed its funding obligation,  it will have earned the following interest in
each prospect:


         Evi Prospect                                               66.67%
         Verdigris Prospect                                         66.67%
         Joarcam Prospect                                           70.00%
         Buffalo Lake Prospect                                      70.00%






                                       14

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 3 - OIL AND GAS PROPERTIES (continued)

         In the event the Company  does not provide the funds as  required,  the
Company will retain no interest in the prospects.

         During the year ended  December 31, 2004,  the Company paid  $1,283,149
towards the exploration and development of the oil and gas prospects in Alberta.
During the year ended December 31, 2005,  the Company paid $730,822  towards the
exploration  and  development  of the oil and gas prospects in Alberta.  For the
year ended  December  31,  2006,  $285,975  was spent to install the  production
facilities at the EVI well. All of these costs have been capitalized.

         During 2006,  EVI property was  determined to have proved oil reserves.
Total  capitalized  costs for the EVI  property  were  removed from the unproved
properties and classified as proved properties.  For the year ended December 31,
2006, the Company received  revenues of $213,398 from the EVI property.  For the
three months ended March 31, 2007, the Company received revenues of $50,852 from
the EVI property.  As of December 31, 2006, the total  capitalized costs related
to the EVI property, net of depletion of $75,103 was 1,262,298.  As of March 31,
2007, the total capitalized costs related to the EVI property,  net of depletion
of $95,103 was $1,242,298.

         During 2005,  the Joarcam  property in Alberta was  determined  to have
proved oil reserves.  The total  capitalized costs for the Joarcam property were
removed from the unproved  properties and classified as proved  properties.  For
2005, the Company received  $305,235 in revenues from the Joarcam  property.  On
November  10, 2005,  the Company  sold its interest in the Joarcam  property for
$1,930,225. Total capitalized costs relating to the Joarcam property at November
10, 2005 were  $962,545,  and total  depletion  expense  relating to the Joarcam
property at November 10, 2005 was $73,811.  The Company recognized a gain on the
sale of the Joarcam  property of $1,041,491.  The Company  received  proceeds of
$965,108  and  recorded  a  receivable  of  $965,117  related to the sale of the
property.  During the period ended June 30,  2006,  the  receivable  of $965,117
related to the sale of the Joarcam property was received by the Company.

California Prospects, U.S.A.

         On December 5, 2003,  the Company  entered  into two option  agreements
with Archer  Exploration,  Inc. (Archer) to acquire Archer's interest in certain
unproven oil and gas prospects located in the State of California, U.S.A., known
as North Franklin Prospect and Winter Pinchout Prospect.

         To  earn an  assignment  of 100% of  Archer's  interests  in the  North
Franklin Prospect, being a 100% working interest (76% net revenue interest), the
Company  made an initial  cash payment of $85,000 and is required to pay $15,000
at spud of the initial test well and $25,000 at  completion  of the initial test
well.  In  addition,  the  Company is  responsible  for all  expenses  for lease
extensions and rental of existing leases  (including a 20% fee),  acquisition of
any  additional  leases  (including  a 20% fee) and  costs  in  connection  with
drilling and completion of the initial test well.



                                       15

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 3 - OIL AND GAS PROPERTIES (continued)

         Pursuant to the agreement,  Archer retains a 2.5% overriding royalty, a
5% working  interest  through the  completion  of the initial  test well and the
right to participate in a 5% working interest.

         The Company has an agreement to farm-out a 35% working  interest in the
North Franklin Project to Fidelis Energy,  Inc. (see Note 6). Under the terms of
the  agreement,  Fidelis  will  contribute  $500,000  towards the  drilling  and
completion  of the  Archer-Whitney  #1 well and  participate  as a full  working
interest partner on all further costs including drilling of any additional wells
on the project.

         To earn an  assignment  of 100% of  Archer's  interests  in the  Winter
Pinchout Prospect, being a 100% working interest (76% net revenue interest), the
Company  made an initial cash payment of $100,000 and is required to pay $15,000
at spud of the  initial  test  well of the first  three  prospects  drilled  and
$25,000 at  completion  of the initial test well of each  prospect  drilled.  In
addition,  the Company is responsible for all expenses for acquisition of leases
acquired  (including  a 20% fee),  acquisition  and  analysis  of seismic  data,
drilling and completion of the initial test well on the first  prospect  drilled
and a monthly management fee in the amount of $10,000 commencing January 2004.

         Pursuant to the agreement,  Archer retains a 2.5% overriding royalty, a
5% working  interest  through the  completion  of the initial  test well and the
right to participate in a 10% working interest.

         In August 2004, the Company  executed  acquisition  and joint operating
agreements on five natural gas prospects in California with Archer  Exploration,
Inc. Pursuant to the agreements, the Company has acquired a 7.5% carried working
interest  on four  of the  prospects  and has  acquired  a 25%  carried  working
interest in the fifth  prospect.  The Company is carried on all costs related to
the prospect through the licensing,  permitting,  drilling and completion of the
first well on each project. In the event of a successful gas well being drilled,
the Company,  following  testing and  completion,  would be responsible  for the
working interest costs of well tie-in and pipeline.  The Company would also be a
working interest participant on any additional gas wells drilled.

         During the year ended December 31, 2003,  the Company  incurred a total
of $405,000 in  acquisition  and  exploration  costs  relating to the California
prospects. During the year ended December 31, 2004, the Company incurred a total
of $898,204 in acquisition,  exploration  and development  costs relating to the
California  prospects.  During the year ended  December  31,  2005,  the Company
incurred a total of $756,675 in acquisition,  exploration and development  costs
relating to the California  prospects.  During the year ended December 31, 2006,
the Company  incurred a total of  $1,081,515  in  acquisition,  exploration  and
development costs relating to the California prospects.







                                       16

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 3 - OIL AND GAS PROPERTIES (continued)

         During 2005, the North Franklin  property was determined to have proved
gas  reserves.  Total  capitalized  costs for the North  Franklin  property were
removed from the unproved  properties and classified as proved  properties.  For
2005,  the Company  received  revenues  of  $1,372,675  from the North  Franklin
property.  As of December 31, 2005, the total  capitalized  costs related to the
North Franklin  property,  net of depletion of $132,121 was $1,345,384.  For the
three months  ended March 31, 2007 and 2006,  the Company  received  revenues of
$569,495 and $505,754 from the North Franklin Property. As of December 31, 2006,
the total  capitalized  costs  related to the North  Franklin  property,  net of
depletion  of  $469,530  was  $2,110,736.  As  of  March  31,  2007,  the  total
capitalized  costs related to the North Franklin  property,  net of depletion of
$564,530 was $2,015,736.

         At March 31, 2007 and December 31, 2006, the total capitalized costs in
unproved  properties in the Winter Pinchout  Prospect was $627,375 and $627,375,
respectively.

Kansas Prospects, U.S.A.

         During  2005,  the  Company  acquired  an  interest in some oil and gas
properties in Kansas.  As of December 31, 2005, the Company had spent $54,286 on
these properties.  During the year ended December 31, 2006, the Company incurred
$20,000 in costs related to this property.  These costs were capitalized as part
of unproved properties. In June 2006, the Company abandoned the Kansas property,
and the capitalized cost of $74,286 was expensed.

NOTE 4 - ASSET RETIREMENT OBLIGATION

         Effective  January 1, 2003, the Company adopted  Statement of Financial
Accounting Standards No. 143, ACCOUNTING FOR ASSET RETIREMENT OBLIGATIONS ("SFAS
143"). This statement  applies to obligations  associated with the retirement of
tangible  long-lived  assets that result from the acquisition,  construction and
development of the assets.

         SFAS 143 requires  that the fair value of a liability  for a retirement
obligation be  recognized in the period in which the liability is incurred.  For
oil and gas  properties,  this is the  period  in  which  an oil or gas  well is
acquired or drilled.  The asset retirement  obligation is capitalized as part of
the carrying amount of the asset at its discounted fair value.  The liability is
then  accreted  each period until the liability is settled or the asset is sold,
at which time the liability is reversed.

         The  Company  identified  and  estimated  all of its  asset  retirement
obligations  for  tangible,  long-lived  assets as of  January  1,  2003.  These
obligations  were for  plugging and  abandonment  costs for depleted oil and gas
wells. The Company had no proved reserves in 2003 or 2004, therefore the Company
did not record an asset  retirement  obligation.  During the year ended December
31, 2005, the Company  estimated its asset retirement  obligation to be $45,000,
for three gas wells at the North  Franklin  property.  Upon  recognition of this
asset  retirement  obligation,  a  liability  of $45,000  was  recorded  and the
capitalized costs of proved properties was increased by $45,000.




                                       17

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 4 - ASSET RETIREMENT OBLIGATION (continued)

         During the year ended  December 31, 2006, a fourth  producing  gas well
was operating at the North Franklin  property.  The Company  estimated the asset
retirement  obligation  for this well to be $15,000.  Upon  recognition  of this
asset retirement obligation,  an additional liability of $15,000 was recorded in
the  asset  retirement  obligation  and  the  capitalized  costs  of the  proved
properties  was increased by $15,000.  At March 31, 2007 and 2006,  the total of
the asset retirement obligation was $60,000 and $45,000, respectively.

NOTE 5 - CONCENTRATIONS

         At March 31, 2007,  approximately  92% of the  Company's  revenues came
from four gas wells in California.  The loss of these wells,  or a disruption in
production  from these  wells,  would  adversely  effect the  operations  of the
Company.

NOTE 6 - COMMON STOCK

         On November  20,  2003,  the  Company  restructured  its share  capital
whereby the total common shares  presently  issued and  outstanding  was forward
split on a 1 (old) to 12 (new)  basis.  Effective  January  5, 2004 the  Company
restructured  its share capital whereby the total common shares presently issued
and outstanding was forward split on a 1 (old) to 2 (new) basis.  All references
to common stock,  common shares  outstanding,  average  numbers of common shares
outstanding  and per share amounts in these  Financial  Statements  and Notes to
Financial  Statements  prior to the  effective  date of the forward stock splits
have been  restated  to reflect  the 12:1 and the 2:1 common  stock  splits on a
retroactive basis.

         On December  5, 2003,  the Company  received  $500,000 in  subscription
proceeds  from a director and officer for the purchase of 444,444  common shares
of the company's  stock pursuant to a Regulation S Private  Placement  Financing
which was  announced on November 25, 2003 and whereby the Company plans to issue
up to  3,555,556  common  shares of its capital  stock.  During the three months
ended March 31, 2004,  the Company  received  subscription  proceeds of $750,000
pursuant to the Private Placement Financing. During the three months ended March
31, 2004,  1,112,102  shares were issued in  accordance  with the  $1,250,000 in
subscription proceeds received.

         On March 23,  2004,  the Company  entered  into an  agreement  with two
shareholders  for the  shareholders  to surrender  for  cancellation  24,600,000
regulation 144 restricted shares of the Company's common stock.

         During the three  months  ended June 30,  2004,  the  Company  received
subscription  proceeds of $630,000 pursuant to the Private Placement  Financing.
During the three  months  ended June 30,  2004,  661,915  shares  were issued in
accordance with the $630,000 in subscription proceeds received.




                                       18

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 6 - COMMON STOCK (continued)

         On June 30, 2004, the Company received share  subscription  proceeds of
$275,000 for 500,000  shares of restricted  common stock pursuant to the Private
Placement  Financing  announced on November  25,  2003.  During the three months
ended  September 30, 2004,  500,000  shares were issued in  accordance  with the
$275,000 in subscription proceeds received.

         On August 18, 2004,  the Company issued  250,000  restricted  shares of
common stock for $25,000 in accounts payable.

         On October 18, 2004, the Company issued  156,000  restricted  shares of
common stock for consulting expense of $15,600.

         On November 23, 2004, the Company issued 362,394 shares of common stock
for debt issue  costs of  $350,000  associated  with the  Company's  issuance of
convertible debt.

         On April 28, 2006, the Company issued  1,200,000 shares of common stock
for consulting services valued at $324,000.

         On May 3, 2006, the Company issued 10,000,000 shares of common stock to
its officers and directors for services valued at $2,750,000.

         As of March 31,  2007,  the Company has not adopted a stock option plan
or granted any stock options and  accordingly  has not recorded any  stock-based
compensation.

NOTE 7- RELATED PARTY TRANSACTIONS

         Pursuant  to  consulting   agreements   dated  November  15,  2003  and
renegotiated July 1, 2005 the Company agreed to pay $15,000 per month to the CFO
and director of the Company and $20,000 per month to the  President and director
of the Company.

         During 2003 and 2004,  the Company  entered  into  several  acquisition
agreements  with  1048136  Alberta  Ltd.  (see Note 4).  The  Company's  current
president,  Robert  McIntosh,  was a director of 1048136  Alberta  Ltd.  and had
resigned  from that  position  prior to his  involvement  with the Company.  Sak
Narwal, a shareholder of the Company, was also a director of 1048136 Alberta Ltd
and Scott  Marshall,  the majority  shareholder of 1048136  Alberta Ltd., is the
spouse of Naomi Patricia  Johnston,  owner of a 11.76%  interest in the Company.
Despite the  existence of these related  parties,  the  consideration  exchanged
under the  Agreements  described  above was negotiated at "arms length," and the
directors  and  executive  officers of the Company used criteria used in similar
uncompleted  proposals  involving  the Company in comparison to those of 1048136
Alberta Ltd.




                                       19

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 7- RELATED PARTY TRANSACTIONS (continued)

         The Company has a "working  interest"  relationship  with joint venture
partner Fidelis Energy Inc. (FDEI: OTC: BB) (see Note 4). Both companies have an
interest in the North  Franklin  gas  project in  Sacramento,  California.  More
recently,  in January  2005,  Fidelis  entered  into an  agreement to acquire an
interest in two oil wells at the Joarcam Project located in Alberta Canada.  The
Company  was  earning a 70%  working  interest  in the entire  Joarcam  Project.
Fidelis also entered into an agreement for the first right of refusal to acquire
the remaining 30% working interest on all future drilling  locations at Joarcam.
Silver  Star and  Fidelis  collectively  acquired  a 100%  working  interest  at
Joarcam.  On October 6, 2005 the 100%  working  interest  at Joarcam was sold to
Enermark, Inc.

         In  addition,  Silver Star and Fidelis  management  work closely in the
evaluation of other potential, jointly feasible exploration prospects. Also, the
two companies share a common origin in that certain  beneficial  shareholders of
both companies have contributed to their formation.

NOTE 8 - INCOME TAXES

         As of December 31,  2006,  the Company had a net  operating  loss carry
forward for income tax reporting  purposes of approximately  $5,552,391 that may
be offset against future taxable income through 2026. Current tax laws limit the
amount of loss  available  to be offset  against  future  taxable  income when a
substantial  change in  ownership  occurs.  Therefore,  the amount  available to
offset future taxable income may be limited. No tax benefit has been reported in
the financial statements, because the Company believes there is a 50% or greater
chance the  carry-forwards  will expire unused.  Accordingly,  the potential tax
benefits of the loss  carry-forwards are offset by a valuation  allowance of the
same amount.


                                2006                2005
Net Operating Losses     $         832,852   $         173,082
Valuation Allowance               (832,852)           (173,082)
                         $               -   $               -
                         ==================  ==================

         The provision for income taxes differs from the amount  computed  using
the federal US statutory income tax rate as follows:


                                                   2006             2005
Provision (Benefit) at US Statutory Rate      $       659,770   $       (8,727)
Increase (Decrease) in Valuation Allowance           (659,770)           8,727
                                              $             -   $             -
                                              ================  ===============

         The Company  evaluates its valuation  allowance  requirements  based on
projected future operations.  When  circumstances  change and causes a change in
management's  judgment  about the  recoverability  of deferred  tax assets,  the
impact of the change on the valuation is reflected in current income.



                                       20

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 9 - LEASE COMMITMENT

         On December 1, 2005,  the Company  entered into a lease  agreement  for
approximately 129 square feet of office space at 9595 Wilshire Blvd., Suite 900,
in Beverly Hills, California.  The lease expired November 30, 2006 and continues
on a month to month basis after that date.  The lease  payments  were $1,814 per
month. On December 1, 2006, the Company has contracted a Business  Identity Plan
Agreement  (BIP) at the same  address  for a fee of $300 per  month.  This is an
annual contract and replaces the former lease agreement.

         The minimum  future lease payments under these leases for the next five
years are:


               Year Ended December 31,
                                        2007              $       3,600
                                        2008                          -
                                        2009                          -
                                        2010                          -
                                        2011                          -
                                                          -------------
  Total minimum future lease payments                     $       3,600
                                                          =============

NOTE 10 - CONVERTIBLE DEBENTURES

         On November 23, 2004,  the Company  issued a convertible  debenture and
warrants  to  Cornell  Capital  Partners,  L.P.  ("Cornel").   The  $750,000  in
convertible debentures and 750,000 warrants required the Company to register the
resale of the  shares of common  stock  upon  conversion  or  exercise  of these
securities.

         The  convertible  debenture  carried an interest  rate of 5% per annum.
Principal  and interest was due on November 23, 2007.  At any time,  Cornell was
entitled to convert all or any part of the  principal  amount of the  debenture,
plus accrued  interest,  into shares of the Company's  common stock. On November
23, 2007, at the Company's  option,  the entire principal amount and all accrued
interest shall be either (a) paid to Cornell or (b) converted to common stock.

         The Warrant's to purchase 750,000 of the Company's common stock were to
expire on November 23, 2009.  The exercise  price of the warrant was one hundred
twenty percent (120%) of the closing bid price of the Company's  common stock on
the exercise date or as subsequently adjusted. The Company accounts for the fair
value of these  outstanding  warrants to purchase  common  stock and  conversion
feature of its convertible notes in accordance with SFAS No. 133 "Accounting For
Derivative  Instruments  and  Hedging  Activities"  and  EITF  Issue  No.  00-19
"Accounting  For Derivative  Financial  Instruments  Indexed To And  Potentially
Settled In A Company's Own Stock;"  which  requires the Company to bifurcate and
separately   account  for  the  conversion  feature  and  warrants  as  embedded
derivatives contained in the Company's convertible notes.



                                       21

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 10 - CONVERTIBLE DEBENTURES (continued)

         Pursuant to SFAS No. 133, the Company  bifurcated the fair value of the
conversion  feature from the convertible notes, since the conversion feature was
determined to not be clearly and closely  related to the debt host. In addition,
since the effective  registration  of the  securities  underlying the conversion
feature and warrants is an event outside of the control of the Company, pursuant
to EITF Issue No. 00-19,  the Company  recorded the fair value of the conversion
feature  and  warrants  as long- term  liabilities  as it was  assumed  that the
Company would be required to net-cash settle the underlying securities.

         The  Company is required to carry  these  embedded  derivatives  on its
balance  sheet at fair  value  and  unrealized  changes  in the  values of these
embedded  derivatives are reflected in the statement of operation as "derivative
valuation gain (loss) on value of warrants and conversion feature". In 2004, the
Company  recognized  a  liability  and  expense  of  $835,315  related  to these
derivatives.  On October  14,  2005,  the Company  paid  $782,175 to pay-off the
convertible  note. The warrants were also canceled.  Since the convertible  note
related to these derivatives was paid during 2005 and the warrants canceled, the
entry recording the liability and expense was reversed in 2005.

         On November 23, 2004,  the Company paid $102,500 in cash for debt issue
costs. The Company also issued 362,394 shares of common stock valued at $350,000
for debt issue costs.  Total debt issue costs of $452,500  were  capitalized  in
financial  statements.  These debt issue costs were being  amortized  over three
years.  Since the convertible  debentures related to these debt issue costs were
paid-off in October 2005,  the Company  expensed the  remaining  $358,814 of the
debt issue costs  related to these  convertible  debentures  as of December  31,
2005.

         On March 10, 2005,  the Company  executed a  Convertible  Debenture for
$550,000.  The note is due and  payable in full on or before  March 10, 2006 and
carries an  interest  rate of 5% per annum.  The notes are  convertible,  at the
discretion  of the  holder,  into  shares of common  stock of the  Company  at a
conversion  price of $1.00 per share. On March 30, 2005, the Company  executed a
Convertible  Debenture for  $200,000.  The note is due and payable in full on or
before  March 10, 2006 and carries an interest  rate of 5% per annum.  The notes
are convertible, at the discretion of the holder, into shares of common stock of
the Company at a conversion  price of $1.00 per share. On December 13, 2005, the
Company paid $134,424 towards this note. On June 30, 2006, this note was paid in
full.

         On April 8, 2005,  the Company  executed a  Convertible  Debenture  for
$160,000.  The note is due and  payable  in full on or before  April 8, 2006 and
carries an  interest  rate of 5% per annum.  The notes are  convertible,  at the
discretion  of the  holder,  into  shares of common  stock of the  Company  at a
conversion  price of $1.00 per share.  On May 17, 2005,  the Company  executed a
Convertible  Debenture for  $150,000.  The note is due and payable in full on or
before May 17, 2006 and carries an interest rate of 5% per annum.  The notes are
convertible, at the discretion of the holder, into shares of common stock of the
Company at a conversion  price of $1.00 per share.  On December  13, 2005,  this
note was paid in full.  The Company paid a total of $319,880 for  principal  and
interest.



                                       22

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 10 - CONVERTIBLE DEBENTURES (continued)

         On October 14, 2005,  we entered into a securities  purchase  agreement
with  H.C.  Wainwright  for  a  PIPE  Offering  which  is a  private  investment
opportunity in a public  company for an aggregate  purchase price of $3,430,000,
of  which  we  have  issued  (i) a  $3,430,000  secured  convertible  debenture,
convertible  into  shares of our  common  stock at a fixed  conversion  price of
$.315,  par value  $0.001,  and (ii) a  warrant  to  purchase  an  aggregate  of
34,408,717  additional  shares of our common stock at an exercise price of $.315
and $.63 per share and are exercisable until October 14, 2010.

         Beginning on the six (6) month  anniversary of the Closing,  and on the
first  business  day of each  month  thereafter  until  the  Notes are no longer
outstanding the Company shall pay 1/18th of the original principal amount of the
Notes and all accrued and unpaid interest.  The Company shall elect to make such
payments in shares of the Company's  common  stock.  Each share of the Company's
common stock will be valued at 92.5% of the five (5) day VWAP immediately  prior
to the payment date. The interest on the  convertible  debenture shall accrue on
the  outstanding  principal  balance  at a rate of 8% per  annum.  For the three
months  ended  March 31,  2007,  $67,660 has been  charged as  interest  expense
related to this debt.

         The Warrants to purchase  34,408,717 of the Company's common stock will
expire on October 14, 2010.  The exercise price of the warrant is fixed at $.315
and $.63 and has an exercise period of five years.  The Company accounts for the
fair  value of these  outstanding  warrants  to  purchase  common  stock and the
conversion  feature of its  convertible  notes in  accordance  with SFAS No. 133
"Accounting For Derivative  Instruments  And Hedging  Activities" and EITF Issue
No.  00-19  "Accounting  For  Derivative  Financial  Instruments  Indexed To And
Potentially  Settled In A Company's  Own Stock;"  which  requires the Company to
bifurcate  and  separately  account for the  conversion  feature and warrants as
embedded derivatives contained in the Company's convertible notes.

         Pursuant to SFAS No. 133, the Company  bifurcated the fair value of the
conversion  feature from the convertible notes, since the conversion feature was
determined to not be clearly and closely related to the debt host, and since the
effective  registration of the securities  underlying the conversion feature and
warrants  is an event  outside of the control of the  Company,  pursuant to EITF
00-19.  The  Company  recorded  the fair  value of the  conversion  feature  and
warrants  as  long-term  liabilities  as it was  assumed  the  Company  would be
required to net-cash settle the underlying securities.







                                       23

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 10 - CONVERTIBLE DEBENTURES (continued)

         The Company is required to carry these derivatives on its balance sheet
at fair value and  unrealized  changes in the  values of these  derivatives  are
reflected in the statement of operation as "derivative valuation gain (loss)".

         In addition  8,711,084  warrants  have been issued to H.C.  Wainwright,
John R.  Clarke,  Scott F.  Koch,  Ari  Fuchs,  Jason A. Stein and First SB Inc.
respectively,  with series A, and C each exercisable at $.315 and series B and D
each exercisable at $.63 with terms of 1 year from October 14, 2005.


                                                      Warrants
                                                  -----------------
H.C. Wainwright & Co. Ltd.                                2,177,768
John R. Clarke                                              947,328
Scott F. Koch                                               947,328
Ari J. Fuchs                                                217,776
Jason A. Stein                                               65,332
1st SB Partners Ltd.                                      4,355,552
                                                  -----------------
     Total                                        $       8,711,084
                                                  =================

         For  2005,  the  value  of the  conversion  feature  and  warrants  was
calculated using the  Black-Scholes  method as of December 31, 2005 based on the
following  assumptions:  an average risk free rate of 4.25; a dividend  yield of
0.00%;  and an average  volatility  factor of the  expected  market price of the
Company's  common  stock of  102.61%.  The market  value of the common  stock at
December  31, 2005 was $.22 per share.  At December  31,  2005,  the  derivative
liability was $6,458,056 and the loss on derivative valuation was $5,622,741.

         For  2006,  the  value  of the  conversion  feature  and  warrants  was
calculated  using the Black- Scholes method as of December 31, 2006 based on the
following  assumptions:  an average risk free rate of 4.85; a dividend  yield of
0.00%;  and an average  volatility  factor of the  expected  market price of the
Company's  common  stock of  93.8%.  The  market  value of the  common  stock at
December  31, 2006 was $.047 per share.  At December 31,  2006,  the  derivative
liability was $279,074 and the gain on derivative valuation was $6,178,983.

         On October 14, 2005,  the Company paid  $480,000 in cash for debt issue
costs related to the convertible debenture of $3,430,000. These debt issue costs
were  capitalized in the financial  statements and are being  amortized over two
years using the interest  method.  At March 31, 2007 and December 31, 2006,  net
debt issue costs  related to these  convertible  debentures  were  $136,835  and
$197,494, respectively.





                                       24

<PAGE>



                            SILVER STAR ENERGY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 10 - CONVERTIBLE DEBENTURES (continued)

         Silver  Star  Energy is in default of the October 14, 2005 terms of the
convertible  debenture.  This  Company has been unable to have the  Registration
Statement on Form SB2 declared effective within the 90 days after closing as was
required.  Liquidated  damages in the  amount of  $68,600 or 2% of the  offering
amount of $3,430,000 have been paid.  Further liquidated damages of 1% per month
of the offering amount, totaling $531,649 have been accrued. This represents the
default period from January 14, 2006 to March 31, 2007.

         Amortization payments of 1/18th of the original amount of $3,430,000 is
required to be paid on the six month anniversary of the closing and on the first
business day of each month thereafter until the notes are no longer outstanding.
The  company  may elect to make these  payments  in cash or in  payments  of the
company's stock.

         At this time no payments have been made.  The company  continues in its
efforts  of  clearing  the  registration  statement  and  attempting  to have it
declared  effective  concurrently  while  evaluating  alternatives  to repay the
convertible  debenture.  At this time the company does not have  sufficient cash
flow to repay  the  original  offering  amount  in  cash,  based on the 18 month
amortization period.

         On March 8, 2007  three of our  creditors  from our  October  14,  2005
financing  filed a claim for  monies  owed under the Note and  Warrant  Purchase
Agreement in the United States  Bankruptcy Court Central District of California.
These three creditors  represent $950,000 of the $3,430,000 that was raised. The
company has consulted with legal counsel in order to negotiate a settlement.  We
are currently exploring  alternative  financing options to repay the October 14,
2005  creditors.  One of  these  options  may be the  forced  sale of the  North
Franklin asset.

NOTE 11 - SUBSEQUENT EVENTS

         The  Company  has been in  default  with the  lenders  pursuant  to the
convertible note and warrant purchase  agreement of October 2005. Three lenders,
representing  $950,000 of the  $3,430,000  that was raised under the  financing,
filed a claim for monies  owed in the United  States  Bankruptcy  Court  Central
District of  California.  The Company and its legal counsel have since reached a
negotiated settlement that all of the lenders have now accepted.  The settlement
will result in the sale of the Company's 40% interest  North  Franklin Gas Field
to an arm's-length  third party,  the repayment of $2.4 million  pro-rata to the
lenders  and the  purchase of a revenue  interest in the MB Gas Inc.,  a private
Alberta,  Canada,  oil and gas  exploration  company.  The Company will sell its
interest in the Franklin gas field for a total of  $3,100,000  and will repay in
cash $2,400,000 of the  approximately  $3,429,885 that is presently owing to the
Lenders.  This Asset Sale Agreement is dated April 1, 2007 and will close on May
1, 2007.  In order to settle the  balance,  the  Company  will amend the related
lending  documents to allow for  conversion of such debt into common shares at a
deemed  conversion  price  of  $0.04  share.  The  Company  will  also  re-price
12,500,000 outstanding warrants to allow exercise at a price of $0.04.




                                       25

<PAGE>



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

GENERAL  - This  discussion  should  be read in  conjunction  with  Management's
Discussion and Analysis of Financial  Condition and Results of Operations in the
Company's annual report on Form 10-KSB for the year ended December 31, 2006.

PLAN OF OPERATIONS

         On  February  14th,  2007 we  received  an  "Evaluation  of Oil and Gas
Reserves" by Cecil Engineering,  Inc., Petroleum Reservoir Engineer which valued
remaining Proved  Developed  Producing  Reserves (PDP) in the  "Whitney-Winters"
channel from the four (4) gas wells aforementioned.  Having cumulatively to date
produced a total of 1,944,328 Mcf gas (1.94 Bcf), the remaining  reserves to the
100%  Working  Interest  were quoted at  2,694,781  Mcf or 2.69 Bcf gas. Net Gas
Reserves were stated at 2,327,139 Mcf or 2.37 Bcf. The four  producing  wells in
the  reservoir  are declining in pressure both measured at the casing and tubing
of the wells.  Engineering now anticipates a predictable gas production  decline
through the year 2014.

         A Present  Value  Profile  Discount  Rate of 10% or PV 10 was valued at
$11,962,468  to the 100%  interest.  Silver Star's 40% Working  Interest is thus
currently  valued at  $4,784,987 on a PV 10 for the Proved  Developed  Producing
Reserves.

         On  March  15th,   2007  we   received   an  updated   version  of  the
aforementioned reservoir engineering by Cecil Engineering,  Inc. with additional
costs applied for the required  pipeline  compression,  additional costs of well
operations  and  maintenance as well as a reduced gas pricing model of $6.00 per
Mcf. This newly rerun  economics gave a value to the 100% interest of $9,226,619
and therefore  $3,706,647  to Silver Star's 40% working  interest on a PV 10 for
the Proved Developed Producing Reserves.

         This evaluation by Cecil Engineering,  Inc. supersedes the September 1,
2006 reserve report by Chapman Petroleum Engineering, Ltd.

         On March 8, 2007  three of our  creditors  from our  October  14,  2005
financing  filed a claim for  monies  owed under the Note and  Warrant  Purchase
Agreement in the United States  Bankruptcy Court Central District of California.
These three creditors  represent $950,000 of the $3,430,000 that was raised. The
company has consulted with legal counsel in order to negotiate a settlement.  We
are currently exploring  alternative  financing options to repay the October 14,
2005  creditors.  One of  these  options  may be the  forced  sale of the  North
Franklin asset.

SUBSEQUENT EVENTS

         Silver  Star has been in default  with the  lenders  (collectively  the
"Lenders')  pursuant to the convertible note and warrant purchase agreement (the
"Financing")  of October  2005.  Three  Lenders,  representing  $950,000  of the
$3,430,000 that was raised under the Financing, filed a claim for monies owed in
the United States  Bankruptcy Court Central District of California.  The Company
and  its  legal  counsel  have  since  reached  a  negotiated   settlement  (the
"Settlement")  that all of the Lenders have now accepted.  The  Settlement  will
result in the sale of the Company's 40% interest  North Franklin Gas Field to an
arm's-length third party, the repayment of $2.47 million pro-rata to

                                       26

<PAGE>



the Lenders and the purchase of a revenue interest in the MB Gas Inc., a private
Alberta, Canada, oil and gas exploration company, on the terms detailed below.

         The  Company  will sell its  interest in the  Franklin  gas field for a
total of  $3,100,000  and will  repay in cash  $2,470,000  of the  approximately
$3,429,885 that is presently owing to the Lenders.  This Asset Sale Agreement is
dated  April 1,  2007 and will  close on May 1,  2007.  In order to  settle  the
balance,  the Company  will amend the  related  lending  documents  to allow for
conversion of such debt into common shares at a deemed conversion price of $0.04
share. The Company will also re- price 12,500,000  outstanding warrants to allow
exercise at a price of $0.04.

         The Company  commissioned  an independent  report (the "Report") on the
fair  market  value  of  the  proved   developed   producing   reserves  in  the
"Whitney-Winters"  channel  from  the  four  (4)  producing  gas  wells.  Having
cumulatively  to date  produced a total of  1,944,328  Mcf gas (1.94  Bcf),  the
remaining reserves to the 100% working interest were calculated at 2,694,781 Mcf
(2.69 Bcf) gas. The four wells in the  reservoir  are  declining in pressure and
additional costs are expected for pipeline  compression.  The Report valued 100%
of the interest in the North Franklin field at $9,226,619  ($3,706,647 to Silver
Star's  40%  working  interest  on a PV 10 for the  proved  developed  producing
reserves). The value to the Company's 32% net revenue interest is $2,952,518 and
therefore  the  purchase  price of  $3,100,000  represents  a premium to current
value.

         Silver Star and MB Gas Inc.  ("MB"),  a private Alberta  company,  have
executed  an  agreement  whereby  Silver  Star will  acquire an  interest in the
revenues generated by MB from its oil and gas operations. Silver Star has agreed
to advance loans of $500,000  (minimum) to $1 million  (maximum) to MB in return
for the  assignment  of  revenue  from  MB's  oil and gas  operations.  The Loan
advances will be repaid from MB's revenues, as 12.5% to Silver Star until payout
(B.P.O.);  thereafter 5% to 10% (A.P.O.)  pro-rated  above 5% for amounts loaned
over $500,000.

         MB owns a majority interest in a sweet-sour gas processing facility and
pipeline  located in the Province of Alberta,  that is linked to a  transporting
pipeline  that runs south to Encana's Hub near the U.S. - Canada  border.  MB is
presently  connecting 3 Sawtooth  formation  natural gas wells (the "Wells") and
this work is scheduled to be completed within the next six months. Flow tests on
the wells  indicate that they should produce a minimum of 1,300 Mcf per day when
they are connected, of which MB Gas will earn up to a 67.5% net revenue interest
before payout (B.P.O.) and 45.0% after payout (A.P.O.). MB also controls certain
prospective  lands in the area  targeting  mostly middle and deeper  gas-bearing
formations.  These are in relatively close proximity to the pipeline system, and
it is expected that the gas from any new commercial grade discoveries made by MB
on those lands,  together with gas from a number of previously plugged gas wells
in the area that are tied-in, will be carried in MB's pipeline.

         We can expect  production from MB Gas to commence in August of 2007 for
revenue being received in October 2007.

         At the Evi  Project,  discussions  are ongoing with  neighboring  lease
holders and other  potential  partners as to the  possibility  of a farm-in on a
Granite Wash well. A suitable  location SW of the 7-11 well has been  engineered
targeting the prolific Granite Wash. The Company feels that this location in the
seismic  section will be above the water  encountered  in the 7-11 well.  As the
estimate of the well cost is in excess of $1.0 million cased and completed,  the
Company will require a participation partner.


                                       27

<PAGE>




RESULTS OF OPERATIONS

REVENUE

         Revenue  increased to $664,863 for the quarter  ended March 31, 2007 up
from  $597,324  in the same  period in 2006.  This  increase  is a result of our
properties  continuing production at the North Franklin for revenue of $614,011,
and the addition of our well at the EVI that produced $50,852 in revenue.

COST OF REVENUE

         The Company  recorded cost of revenue and depletion of $192,509  during
the quarter ended March 31, 2007 up from $170,095 during the quarter ended March
31, 2006. This increase was mainly due to an increase in the depletion expense.

GENERAL AND ADMINISTRATIVE EXPENSES

         General and  administrative  expenses consist  primarily of accounting,
legal,  depreciation  and  selling  and  marketing  expenses.  The  general  and
administrative  expenses for the quarter ended March 31, 2007 are $178,795. This
is a decrease  from 2006 of $4,774.  Professional  fees which  include legal and
accounting  were  $129,058  for the quarter  ended  March 31,  2007  compared to
$78,041 and this increase is due to an increase in legal fees for the quarter.

         Consulting  and  Management  fees were  $342,083 for the quarter  ended
March 31,  2007 and  increased  over the same period in 2006 by  $146,258.  This
increase was due to an increase in consulting expenses. We expect to continue to
incur general and administrative expenses to support the business.

INTEREST EXPENSE

         Interest  expense  increased  for the quarter ended March 31, 2007 with
$128,228  compared to $130,818  for the quarter  ended March 31,  2006.  This is
reflective of interest  charges that accrued from our  financing  that closed on
October 14,  2005.  During the quarter  ended March 31,  2007,  the Company also
incurred liquidated damages of $102,900 on the convertible debt.

NET LOSS

         The Company  ended the first  quarter of March 31, 2007 with a net loss
of ($408,710) compared to ($228,072) for the same period in 2006.

LIQUIDITY AND CAPITAL RESOURCES

         Cash and cash  equivalents  from  inception have been  insufficient  to
provide the operating  capital  necessary to operate the Company.  The necessary
capital to operate the  Company was  initially  provided by the  principals  and
founders of the Company in the form of both debt and capital stock  issuances as
set forth in the financial  statements  incorporated herein. The working capital
necessary to operate the Company and provide for  acquisition  capital came from
the  proceeds  of loans,  a credit  line and  production  revenue as  previously
disclosed.

                                       28

<PAGE>




         The Company had cash and cash  equivalents of $559 and working  capital
deficit  of  $3,832,867  at  March  31,  2007.  This  compares  to cash and cash
equivalents  of $31,533 and working capita deficit of $3,603,925 at December 31,
2006.

         During the three months ended March 31, 2007,  the Company used cash of
$30,974 in operating  activities  compared to being provided cash of $246,231 in
the prior year. At March 31, 2007 the company had an  outstanding  receivable of
$429,108.

         Net cash used by investing activities was $0 for the three months ended
March 31, 2007,  which  compares to $1,224,906  for the same period in 2006. Net
cash used in investing  activities is primarily from  acquisition of oil and gas
property interests.

         Net cash  provided  by (used by)  financing  activities  was $0 for the
three months ended March 31, 2007,  which  compares to $0 for the same period in
2006.

ITEM 3.  CONTROLS AND PROCEDURES

         The Company's Chief Executive  Officer and Chief Financial  Officer are
responsible for establishing and maintaining  disclosure controls and procedures
for the Company.

         (a) Evaluation of Disclosure Controls and Procedures

         As of the end of the period covered by this report, the Company carried
out an  evaluation,  under the  supervision  and with the  participation  of the
Company's management, including the Company's President, of the effectiveness of
the design and operation of the  Company's  disclosure  controls and  procedures
pursuant to Rule 13a-15 under the  Securities  Exchange Act of 1934,  as amended
(the  "Exchange  Act").  Based  upon the  evaluation,  the  Company's  President
concluded that, as of the end of the period, the Company's  disclosure  controls
and  procedures  were effective in timely  alerting him to material  information
relating to the Company  required to be included in the reports that the Company
files and submits pursuant to the Exchange Act.

         (b) Changes in Internal Controls

         Based on his evaluation as of March 31, 2007, there were no significant
changes in the Company's  internal  controls over financial  reporting or in any
other areas that could  significantly  affect the  Company's  internal  controls
subsequent to the date of his most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.












                                       29

<PAGE>



                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         There are no legal proceedings pending or threatened against us.

ITEM 2.  CHANGES IN SECURITIES

    None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     None.

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

     None.

ITEM 5.  OTHER INFORMATION

     None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

Exhibit
Number          Title of Document

10.1     Robert McIntosh's  Consulting  Agreement dated November 15, 2003, filed
         on April 21, 2004 on Form 10KSB/A.

10.2     David Naylor's  Consulting  Agreement dated November 15, 2003, filed on
         April 21, 2004 on Form 10KSB/A.

10.3     Robert  McIntosh's  Loan Agreement  dated  December 31, 2003,  filed on
         April 21, 2004 on Form 10KSB/A.

10.4     Agreement  dated  October 21, 2003  between the Company and Adil Dinani
         disposing  of 657333 BC Ltd.  (Netcash),  filed on November 13, 2003 on
         Form 8-K.

10.5     Agreement  dated  October  29,  2003  between  the  Company and 1048136
         Alberta,  Ltd.  respecting  the  acquisition  of the  Evi  oil  and gas
         prospect, filed on November 13, 2003 on Form 8-K.

10.6     Agreement  dated  October  29,  2003  between  the  Company and 1048136
         Alberta,  Ltd.  respecting the acquisition of the Verdigris oil and gas
         prospect, filed on November 13, 2003 on Form 8-K.

                                       30

<PAGE>



10.7     Agreement  dated  December  5, 2003  between  the  Company  and  Archer
         Exploration,  Inc.  respecting the North Franklin oil and gas prospect,
         filed on December 23, 2003 on Form 8-K.

10.8     Agreement  dated  December  5, 2003  between  the  Company  and  Archer
         Exploration,  Inc.  respecting the Winter Pinchout oil and gas project,
         filed on December 23, 2003 on Form 8-K.

31.1     Certification  Pursuant  to Section  302 of the  Sarbanes-Oxley  Act of
         2002.

31.2     Certification  Pursuant  to Section  302 of the  Sarbanes-Oxley  Act of
         2002.

32.1     Certification  Pursuant  to Section  906 of the  Sarbanes-Oxley  Act of
         2002.

32.2     Certification  Pursuant  to Section  906 of the  Sarbanes-Oxley  Act of
         2002.

(b) Reports on Form 8-K filed.

         None.


































                                       31

<PAGE>



                                   SIGNATURES

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


                            Silver Star Energy, Inc.
                                  (Registrant)

DATE:       May 11, 2007


By:  /s/ Robert McIntosh
Robert McIntosh
President, CEO & Director
(Principal Executive Officer)


By:  /s/ David Naylor
David Naylor
Treasurer, Director
(Principal Financial Officer)