**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 **Washington,
        D.C. 20549**
 
 **FORM
        10-KSB**
 
 x
                ANNUAL
                    REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                    ACT OF
                    1934
                  For
                    the fiscal year ended -**April
                    30, 2005**o
                TRANSITION
                    REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                    ACT OF
                    1934
                  For
                    the transition period from
                    ______
 
 Commission
        file number **000-32089**
 
 **NORTH
        AMERICAN NATURAL GAS, INC.**
 (Name
        of
        small business issuer in its charter)
 
 
 **Washington**
              
              **91-2023071**(State
                  or other jurisdiction of incorporation or organization)
              
              (I.R.S.
                  Employer Identification No.)**580
                  Hornby Street, Suite 210****Vancouver,
                  British Columbia,****Canada**
              
              **V6C
                  3B6**(Address
                  of principal executive offices)
              
              (Zip
                  Code)
 
 Issuer's
        telephone number **(604)
        687-6991**
 
 Securities
        registered pursuant to Section 12)b) of the Act:
 
 Title
                  of each class
              
              Name
                  of each exchange on which registered**Nil**
              
              
              **Nil**
 
 Securities
        registered pursuant to Section 12(g) of the Act:
 **Common
                  Shares**(Title
                  of class)
 
 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 o
 
 Check
        if
        there is no disclosure of delinquent filers in response to Item 405 of
        Regulation S-B is not contained in this form, and no disclosure will be
        contained, to the best of registrant's knowledge, in definitive proxy or
        information statements incorporated by reference in Part III of this Form
        10-KSB
        or any amendment to this Form 10-KSB. o
 
 State
        issuer's revenues for its most recent fiscal year: Nil
 State
        the
        aggregate market value of the voting and non-voting common equity held by
        non-affiliates computed by reference to the price at which the common equity
        was
        sold, or the average bid and asked price of such common equity, as of a
        specified date within the past 60 days. (See definition of affiliate in Rule
        12b-2 of the Exchange Act.)
  
 
  Note:
        If
        determining whether a person is an affiliate will involve an unreasonable
        effort
        and expense, the issuer may calculate the aggregate market value of the common
        equity held by non-affiliates on the basis of reasonable assumptions, if
        the
        assumptions are stated.
 
 June
        28,
        2005 - There are approximately 7,500,000 shares of voting common stock of
        the
        Company held by non-affiliates. The aggregate market value of the voting
        common
        stock held by non-affiliates on June 28, 2005 **,** computed
        at the average bid and ask price of such common equity as of June 28, 2005,
        was
        $7,575,000 (7,5000,000 shares at $1.01 per share), assuming solely for the
        purposes of this calculation that the directors and executive officers of
        the
        issuer are "affiliates". This determination of affiliate status is not
        necessarily a conclusive determination for other purposes.
 
 State
        the
        number of shares outstanding of each of the Issuer's classes of common equity,
        as of the latest practicable date: **June
        28, 2005 - 19,812,500 shares of Common Stock**
 
 Transitional
        Small Business Disclosure Format (Check one):
 YES o NO x
  
 **PART
          I**
 
 **ITEM
                    1.**
                **DESCRIPTION
                    OF BUSINESS**
 
 This
          annual report contains forward-looking statements as that term is defined
          in the
          Private Securities Litigation Reform Act of 1995. These statements relate
          to
          future events or our future financial performance. In some cases, you can
          identify forward-looking statements by terminology such as "may", "should",
          "expects", "plans", "anticipates", "believes", "estimates", "predicts",
          "potential", or "continue" or the negative of these terms or other comparable
          terminology. These statements are only predictions and involve known and
          unknown
          risks, uncertainties and other factors, including the risks in the section
          entitled "Risk Factors", that may cause our or our industry's actual results,
          levels of activity, performance or achievements to be materially different
          from
          any future results, levels of activity, performance or achievements expressed
          or
          implied by these forward-looking statements.
 
 Although
          we believe that the expectations reflected in the forward-looking statements
          are
          reasonable, we cannot guarantee future results, levels of activity, performance
          or achievements. Except as required by applicable law, including the securities
          laws of the United States, we do not intend to update any of the forward-looking
          statements to conform these statements to actual results.
 
 Our
          financial statements are stated in United States Dollars (US$) and are
          prepared
          in accordance with United States Generally Accepted Accounting
          Principles.
 
 As
          used
          in this annual report, the term "we", "us", "our", the "Company" means
          North
          American Natural Gas, Inc., unless otherwise indicated.
 
 **The
          Company**
 
 North
          American Natural Gas, Inc., formerly FAR Group Inc., was incorporated under
          the
          laws of the State of Washington on March 24, 2000. To date, the Company's
          only
          activities have been organizational, directed at acquiring its principal
          asset,
          raising its initial capital and developing its business plan. The Company
          has
          not commenced commercial operations. The Company has no full time employees
          and
          owns no real estate.
 
 During
          the fourth quarter of fiscal 2003, the Company changed its name to North
          American Natural Gas, Inc. as it had anticipated that it would undertake
          a new
          business purpose in the oil and gas exploration industry. The Company entered
          into agreements to purchase interests in two oil and gas exploration
          opportunities subject to raising a minimum of US$11,000,000 in a private
          offering. The Company was unsuccessful in its efforts to raise the minimum
          amount and all funds received were subsequently returned to the original
          subscribers. All agreements were terminated.
 
 In
          contemplation of the proposed new business purpose in the oil and gas
          exploration industry, on March 14, 2003, Jim Glavas, a director of the
          Company,
          acquired an aggregate 9,780,000 shares of common stock of the Company from
          22
          existing shareholders of the Company none of whom own greater than five
          percent
          of the common stock of the Company. Mr. Glavas now beneficially owns, directly
          and indirectly, 12,312,500 (9,850,000 pre-split) shares of common stock
          or
          62.15% of voting securities of the Company.
  As
          we
          were unsuccessful in our efforts to raise the required capital to change
          our
          business purpose, we reverted back to our original business to determine
          the
          feasibility of marketing the Vitamineralherb.com products in various markets,
          and, if the products prove to be in demand, begin marketing and selling
          Vitamineralherb.com products.
  **Background**
 
 On
          April
          13, 2000, the Company acquired a License Agreement with Vitamineralherb.com
          from
          its sole director and President in consideration of the assumption of a
          note
          payable of $35,000. The note was subsequently forgiven. The License Agreement
          grants an exclusive right to distribute Vitamineralherb.com products to
          health
          and fitness professionals in Minnesota via the Internet. The License was
          for an
          initial three-year period and was renewed in 2003 for an additional three-year
          term. The license is now valid until April 2006 subject to the payment
          of the
          annual fees.
 
 
 
 Vitmineralherb.com
          has agreed to provide certain business administrative services to the Company,
          including product development, store inventory, website creation and
          maintenance, establishment of banking liaisons, and development and maintenance
          of an order fulfillment system, thereby enabling the Company to focus strictly
          on marketing and sales.
 
 The
          Company (and its customers) will have access to all products offered on
          the
          Vitamineralherb.com website, as well as the ability to order custom-formulated
          and custom-labeled products. The website is maintained by Vitamineralherb.com,
          and each licensee pays an annual website maintenance fee of $500. All financial
          transactions will be handled by Vitamineralherb.com's Internet clearing
          bank.
 
 **Implementation
          of Business Plan**
 
 The
          Company's business plan is to determine the feasibility of selling
          Viamineralherb.com products to targeted markets. Should the Company determine
          that its business plan is feasible, it intends to employ salespeople to
          call on
          medical professionals, alternative health professionals, martial arts studios
          and instructors, sports and fitness trainers, other health and fitness
          professionals, school and other fund raising programs and other similar
          types of
          customers to interest these professionals in selling to their clients,
          high-quality, low-cost vitamins, minerals, nutritional supplements, and
          other
          health and fitness products. These professionals would sell the products
          to
          their clients via the Internet. The Company plans to implement its business
          plan
          by meeting the following milestones:
 
 Milestone
          1 - Market Survey: In order to determine the feasibility of its business
          plan,
          the Company must conduct research into the various potential target markets.
          The
          market analysis research will likely consist of a telephone survey to 100-200
          potential clients, focusing on three or four of the core target markets,
          such as
          chiropractors, health clubs and alternative medicine practitioners. The
          survey
          would likely contain questions that would determine the marketing approach
          and
          acceptability of specific products.
 
 Milestone
          2 - Hire Salespeople: Should the Company determine that the exploitation
          of the
          license is feasible, it will then have to engage salespeople to market
          the
          products. The Company expects that it may hire two salespeople during its
          first
          year of operation. The hiring process would include running advertisements
          in
          the local newspaper and conducting interviews. It is anticipated that hiring
          the
          salespeople may take four to eight weeks. The cost of hiring the salespeople,
          not including compensation, is estimated at $20,000.
 
 Milestone
          3 - Establish an Office: The Company would then have to establish an office
          or
          offices for the sales force in the appropriate market or markets. This
          would
          include an office, equipment such as computers and telephones, and sample
          inventory for the salespeople. It is anticipated that it would take eight
          to
          twelve weeks to locate acceptable office space and select and purchase
          equipment. The expense of office rental, equipment and inventory samples
          is
          estimated to be $45,000 per year.
 
 Milestone
          4 - Development of Advertising Campaign: The next step would be to develop
          an
          advertising campaign, including a list of prospects based on potential
          clients
          identified in the market survey, and designing and printing sales materials.
          It
          is anticipated that it would take approximately six to ten weeks to develop
          the
          advertising campaign, although, depending on the availability of resources,
          the
          Company will attempt to develop its advertising campaign concurrently with
          establishing an office. The cost of developing the campaign is estimated
          at
          approximately $12,000 per year.
 
 Milestone
          5 - Implementation of Advertising Campaign/Sales Calls: Implementation
          of the
          advertising campaign would begin with mailing the sales materials to the
          identified list of prospects. Approximately two to four weeks thereafter,
          the
          salespeople would begin telephone follow-ups and scheduling of sales calls.
          Although it will be necessary to make sales calls throughout the life of
          the
          company, it is estimated that the first round of sales calls will take
          approximately eight to twelve weeks to complete. The cost of salary and
          expenses
          for two salespeople is estimated at $248,000 per year.
 
 
 
 Milestone
          6 - Achieve Revenues: It is difficult to quantify how long it will take
          to
          convert a sales call into actual sales and revenues. The Company will not
          begin
          receiving orders until its sales force is able to convince potential clients
          to
          begin offering such products to their customers, or to convert from an
          existing
          supplier. The Company hopes that clients would begin placing orders within
          weeks
          of a sales call, but it may take several months before people begin to
          purchase
          products. Moreover, customers may not be willing to pay for products at
          the time
          they order, and may insist on buying on account, which delay receipt of
          revenues
          another month or two.
 
 **Competitive
          Factors**
 
 The
          electronic commerce industry is rapidly evolving and intensely competitive
          and
          the Company expects competition to intensify in the future. Barriers to
          entry
          are minimal and current and new competitors can launch sites at relatively
          low
          costs. In addition, the vitamin, supplement, mineral and alternative health
          product market is very competitive and highly fragmented, with no clear
          dominant
          leader and increasing public and commercial attention. Many of the Company's
          potential competitors have longer operating histories, larger customer
          or user
          bases, greater brand recognition and significantly greater financial, marketing
          and other resources than the Company. In addition, an online retailer may
          be
          acquired by, receive investments from, or enter into other commercial
          relationships with larger, well-established and well financed companies
          as use
          of the Internet and other electronic services increases. Competitors have
          and
          may continue to adopt aggressive pricing or inventory availability policies
          and
          devote substantially more resources to website and systems development
          than the
          Company. Increased competition may result in reduced operating margins
          and loss
          of market share.
 
 **Government
          Regulations**
 
 We
          are
          currently not subject to direct federal, state or local regulation other
          than
          regulations applicable to businesses generally or directly applicable to
          electronic commerce. However, online commerce is new and rapidly changing.
          As a
          result, it is possible that a number of laws and regulations may be adopted
          with
          respect to the Internet. These laws may cover issues such as user privacy,
          freedom of expression, pricing, content and quality of products and services,
          taxation, advertising, intellectual property rights and information security.
          Furthermore, the growth of electronic commerce may prompt calls for more
          stringent consumer protection laws. Several states have proposed legislation
          to
          limit the uses of personal information gathered online or require online
          services to establish privacy policies. The Federal Trade Commission has
          also
          initiated action against at least one online service regarding the manner
          in
          which personal information is collected from users and provided to third
          parties. North American Natural Gas, Inc. will not provide personal information
          regarding our users to third parties. However, the adoption of such consumer
          protection laws could create uncertainty in web usage and reduce the demand
          for
          the Company's products.
 
 The
          Company is not certain how business may be affected by the application
          of
          existing laws governing issues such as property ownership, copyrights,
          encryption and other intellectual property issues, taxation, libel, obscenity
          and export or import matters. The vast majority of such laws were adopted
          prior
          to the advent of the Internet. As a result, they do not contemplate or
          address
          the unique issues of the Internet and related technologies. Changes in
          laws
          intended to address such issues could create uncertainty in the Internet
          market
          place. Such uncertainty could reduce demand for services or increase the
          cost of
          doing business as a result of litigation costs or increased service delivery
          costs.
 
 **Employees
          and Employment Agreements**
 
 At
          present, we have no employees. The Company is managed by Jim Glavas, the
          Company's President in consultation with the Board of Directors. We hire
          consultants, attorneys and accountants as necessary and do not plan to
          engage
          any full-time employees in the near future. We presently do not have pension,
          health, annuity, insurance, stock options, profit sharing or similar benefit
          plans although we may adopt plans in the future.
 
 
 
 **Risk
          Factors**
 
 This
          annual report contains forward-looking statements as that term is defined
          in the
          Private Securities Litigation Reform Act of 1995. These statements relate
          to
          future events or our future financial performance. In some cases, you can
          identify forward-looking statements by terminology such as "may", "should",
          "expects", "plans", "anticipates", "believes", "estimates", "predicts",
          "potential", or "continue" or the negative of these terms or other comparable
          terminology. These statements are only predictions and involve known and
          unknown
          risks, uncertainties and other factors, including the risks in the section
          entitled "Risk Factors", that may cause our or our industry's actual results,
          levels of activity, performance or achievements to be materially different
          from
          any future results, levels of activity, performance or achievements expressed
          or
          implied by these forward-looking statements.
 
 Although
          we believe that the expectations reflected in the forward-looking statements
          are
          reasonable, we cannot guarantee future results, levels of activity, performance
          or achievements. Except as required by applicable law, including the securities
          laws of the United States, we do not intend to update any of the forward-looking
          statements to conform these statements to actual results. Our forward-looking
          statements involve various risks and uncertainties, some but not all of
          which
          are outlined below. We caution readers of this annual report that important
          factors in some cased have affected and, in the future, could materially
          affect
          actual results and cause actual results to differ materially from the results
          expressed in any of our estimates, projections or other forward-looking
          statements. In evaluating us, our business and any investment in our business,
          readers should carefully consider the following factors:
 
 *Our
          Company is in the early development stage. The fact that we have not generated
          revenues since our incorporation raises substantial doubt about our ability
          to
          continue as a going concern, as indicated in our independent auditors'
          opinion
          given in connection with our audited financial statements for the year
          ended
          April 30, 2005 and in the notes to the financial statements included with
          this
          annual report on Form 10-KSB.*
 
 Our
          Company is in the early development stage. We have yet to generate any
          revenues
          since we were incorporated on March 24, 2000. We incurred a loss of $30,203
          for
          the year ended April 30, 2005 and we have an accumulated deficit of $302,246
          from the date of our incorporation on March 24, 2000 through the period
          ending
          April 30, 2005. We anticipate that we will operate in a deficit position
          for the
          foreseeable future. We will require additional financing in order to fund
          our
          operations. To date, our primary source of funds has been the sale of our
          common
          stock but there can be no assurance that we will be able to raise additional
          working capital through the sale of our common stock or through any other
          means.
          If we cannot raise the working capital required for the development of
          our
          business, our business will fail. These circumstances raise substantial
          doubt
          about our ability to continue as a going concern as expressed in an explanatory
          note that forms part of our independent auditors' report on our financial
          statements for the year ending April 30, 2005 and is included in the notes
          to
          the financial statements included with this annual report on Form
          10-KSB.
 
 *There
          is currently no significant public market for shares of our common stock,
          which
          will make it difficult for you to sell your shares. If you cannot sell
          your
          shares, you may lose all of your investment.*
 
 Our
          common stock trades on the National Association of Securities Dealer's
          OTC
          Bulletin Board. We can give no assurance that a significant public market
          for
          our common stock will develop or be sustained. Even if a significant market
          for
          our common shares should develop, the market price for our common shares
          may be
          significantly affected by the current stage of our business, our lack of
          revenues and our financial and operations result from time-to-time. Further,
          equity markets in general and the OTC Bulletin Board in particular can
          experience extreme volatility that can affect the market price of equity
          securities in ways that are often unrelated or disproportionate to the
          operating
          performance of the issuer companies. You should not invest in our company
          unless
          you are prepared to hold onto your securities for a significant period
          of
          time.
 
 
 
 *Our
          directors and officers are engaged in other full-time business activities
          and
          they may not devote sufficient time to our business, which could have an
          adverse
          effect on our ability to conduct operations and generate
          revenues.*
 
 Our
          directors and officers are involved in other business activities. As a
          result,
          our directors and officers may not be able to devote sufficient time to
          our
          business affairs, which may negatively affect our ability to market our
          proposed
          business and conduct both our current and our proposed operations.
 
 *Because
          our officers, directors and principal shareholders control a majority of
          our
          common stock, investors will have little or no control over our management
          or
          other matters requiring shareholder approval.*
 
 Our
          officers and directors, in aggregate, beneficially own 62.15% of the issued
          and
          outstanding shares of our common stock. As a result, they have the ability
          to
          control matters affecting minority shareholders, including the election
          of our
          directors, the acquisition or disposition of our assets, and the future
          issuance
          of our shares. Because our officers and directors control the company,
          investors
          will not be able to replace our management if they disagree with the way
          our
          business is being run. Because control by these insiders could result in
          management making decisions that are in the best interest of those insiders
          and
          not in the best interest of the investors, you may lose some or all of
          the value
          of your investment in our common stock.
 
 *We
          rely on a third party website (* *www.vitamineralherb.com* *)
          that subsequently rely on third parties to ensure that their website and
          software are operating property. If the website and software fail to operate
          properly and the third parties fail to perform as expected, the website
          will not
          operate as intended and our business will be adversely
          affected.*
 
 We
          rely
          on the management of Vitamineralherb.com to maintain the website www.vitamineralherb.com .
          If they
          fail to ensure that the website and software are operating properly and
          the
          website does not operate as intended, our business will be adversely affected.
          Vitamineralherb.com has also agreed to provide certain business administrative
          services to us, including product development, store inventory, establishment
          of
          banking liaisons and the development and maintenance of an order fulfillment
          system. If they fail to provide these business administrative services
          to us,
          our ability to earn revenues will be limited and our business may
          fail.
 
 *Competition
          is strong in the market for online sale of health related products. If
          we cannot
          compete in this market, our ability to earn revenues will be limited and
          our
          business may fail.*
 
 The
          market for online sale of health related products is highly competitive
          and
          consists of a number of established companies. We compete for Internet
          users
          that currently are familiar with more established companies that also offers
          online services. These companies have more financial resources, operating
          experience and brand awareness among Internet users than we have. This
          industry
          is also highly fragmented, and is subject to rapidly changing consumer
          demands
          and preferences.
 
 *Government
          regulation of the Internet could have adverse impacts on our
          business.*
 
 The
          applicability of the Internet of existing laws government taxation of products
          and services sold over the Internet, the protection of intellectual property,
          user privacy, pricing, content, distribution, antitrust and the quality
          of
          products and services is rapidly evolving. The application of these laws
          to the
          Internet and the adoption of new laws or regulations pertaining to these
          matters
          could reduce the rate of growth of the Internet. If these regulations make
          the
          operation of a website such as www.vitamineralherb.com more
          expensive than expected, or more unwieldly than potential purchasers are
          willing
          to tolerate, then these regulations could potentially decrease the usage
          of the
          website and could otherwise harm our business.
 
 
 
 *We
          depend on the continued growth of online commerce.*
 
 The
          business of selling goods over the Internet is dynamic and relatively new.
          Acceptance of and growth in the use of the Internet as a medium for consumer
          commerce may not continue. Concerns about fraud, privacy, and other problems
          may
          discourage additional consumers from adopting the Internet as a medium
          of
          commerce. Market acceptance for recently introduced services and products
          over
          the Internet is highly uncertain, and there are few proven services and
          products. In order to build and continuously expand our user base, we must
          appeal to and acquire consumers who historically have used traditional
          means of
          commerce to purchase goods. If these consumers prove to be less active
          than we
          anticipate, and we are unable to establish efficiencies in our operating
          costs,
          including our cost of acquiring and retaining customers, our business could
          be
          adversely impacted.
 
 *Because
          we can issue additional common shares, and there is a substantial likelihood
          that we will do so in order to finance our marketing plan and our monthly
          operation requirements, purchasers of our common stock may suffer immediate
          dilution of their interest in our company.*
 
 The
          most
          likely source of future funds presently available to us is through the
          sale of
          equity. Any sale of our shares will result in dilution to existing shareholders.
          Furthermore, there is no assurance that we will not incur debt in the future,
          that we will have sufficient fund to repay our future indebtedness or that
          we
          will not default on our future debts, jeopardizing our business viability.
          Finally, we may not be able to borrow or raise additional capital in the
          future
          to meet our needs or to otherwise provide the capital necessary to conduct
          business and exploit our business plan, which might result in the loss
          of some
          or all of your investment in our common stock.
 
 *Because
          our officers and directors are located in non-US jurisdictions, you may
          have no
          effective recourse against the management for misconduct and may not be
          able to
          enforce judgment and civil liabilities against our officers, directors,
          experts
          and agents.*
 
 Our
          President and directors are residents of Canada and all or a substantial
          portion
          of our assets and those of our President and directors are located outside
          of
          the United States. As a result, it may be difficult for investors to enforce
          within the United States any judgments obtained against our company, our
          officers or directors, including judgments predicated upon the civil liability
          provisions of the securities laws of the United States or any state
          thereof.
 
 *Trading
          of our common stock may be restricted by the Securities and Exchange
          Commission's penny stock regulations, which may limit the development of
          a
          liquid public market for our common stock and may limit a shareholder's
          ability
          to buy and sell our common stock.*
 
 Shares
          of
          our common stock are subject to rules adopted by the Securities and Exchange
          Commission that regulate broker-dealer practices in connection with transactions
          in "penny stocks". "Penny Stock" is defined to be any equity security that
          has a
          market price (as defined) less than $5.00 per share or an exercise price
          of less
          than $5.00 per share, subject to certain exceptions. If we establish a
          trading
          market for our common stock, our common stock will most likely be covered
          by the
          penny stock rules, which impose additional sales practice requirements
          on
          broker-dealers who sell to persons other than established customers and
          "accredited investors". The term "accredited investor" refers generally
          to
          institutions with assets in excess of $5,000,000 or individuals with a
          net worth
          in excess of $1,000,000 or annual income exceeding $200,000 or $300,000
          jointly
          with their spouse. The penny stock rules require a broker-dealer, prior
          to a
          transaction in a penny stock not otherwise exempt from the rules, to deliver
          a
          standardized risk disclosure document in a form prepared by the SEC which
          provides information about penny stocks and the nature and level of risks
          in the
          penny stock market. The broker-dealer also must provide the customer with
          current bid and offer quotations for the penny stock, the compensation
          of the
          broker-dealer and its salesperson in the transaction and monthly account
          statements showing the market value of each penny stock held in the customer's
          account. The bid and offer quotations, and the broker-dealer and salesperson
          compensation information, must be given to the customer orally or in writing
          prior to effecting the transaction and must be given to the customer in
          writing
          before or with the customer's confirmation. In addition, the penny stock
          rules
          require that prior to a transaction in a penny stock not otherwise exempt
          from
          these rules, the broker-dealer must make a special written determination
          that
          the penny stock is a suitable investment for the purchaser and receive
          the
          purchaser's written agreement to the transaction. These disclosure requirements
          may have the effect of reducing the level of trading activity in the secondary
          market for the stock that is subject to these penny stock rules. Consequently,
          these penny stock rules may affect the ability of broker-dealers to trade
          our
          securities.
 
 
 
 **Available
          Information and Reports to Securities Holders**
 
 We
          are
          subject to the information and periodic reporting requirements of the Securities
          Exchange Act and, accordingly, will file periodic reports, proxy statements
          and
          other information with the Securities and Exchange Commission. Such periodic
          reports, proxy statements and other information will be available for inspection
          and copying at the Commission's public reference room and the website of
          Commission's Public Reference Room located at 450 Fifth Street N.W., Washington
          D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information
          about the public reference rooms. The Company's filings with the Commission
          are
          also available to the public from the Commission's website at
          http://www.sec.gov.
 
 **ITEM
                    2.**
                **DESCRIPTION
                    OF PROPERTY.**
 
 We
          currently maintain limited office space occupied by Jim Glavas, the Company's
          President for which it pays nominal rent of $100 per month. The address
          is Suite
          210-580 Hornby Street, Vancouver, British Columbia, Canada. We believe
          this
          space is sufficient at this time and we not need to obtain additional office
          space at any time in the foreseeable future until its business plan is
          more
          fully implemented. We do not have any material assets and, as such, we
          do not
          own any real or personal property.
 
 **ITEM
                    3.**
                **LEGAL
                    PROCEEDINGS.**
 
 We
          know
          of no material, active or pending legal proceedings against us, nor are
          we
          involved as a plaintiff in any material proceedings or pending litigation.
          There
          are no proceedings in which any of our directors, officers or affiliates,
          or any
          registered beneficial shareholder are an adverse party or has a material
          interest adverse to us.
 
 **ITEM
                    4.**
                **SUBMISSION
                    OF MATTERS TO A VOTE OF SECURITY
                    HOLDERS.**
  None
 **PART
          II**
 
 **ITEM
                    5.**
                **MARKET
                    FOR COMMON EQUITY AND RELATED STOCKHOLDER
                    MATTERS.**
 
 There
          is
          no "established trading market" for shares of the Company's common stock.
          As of
          March 20, 2003, the Company's common stock was quoted over-the-counter
          on the
          Bulletin Board operated by the National Association of Securities Dealers,
          Inc.,
          under the symbol "NAGA". No assurance can be given that any "established
          trading
          market" for the Company's common stock will develop or be
          maintained.
 
 The
          range
          of high and low closing trades for the Company's common stock during each
          quarter of the fiscal years ended April 30, 2005 and 2004 is shown below.
          Prices
          are inter-dealer quotations, without retail mark-up, mark-down, or commissions
          and may not represent actual transactions.
 
 
 
 **STOCK
          QUOTATIONS**
  Quarter
                      ended:
                  High
                    Trade
                  Low
                      TradeJuly
                      31, 2003
                  1.42
                  1.40October
                      31, 2003
                  1.11
                  1.11January
                      31, 2004
                  2.51
                  2.48April
                      30, 2004
                  3.00
                  3.00July
                      31, 2004
                  1.07
                  1.05October
                      31, 2004
                  1.07
                      (*)
                  1.05
                      (*)January
                      31, 2005
                  1.07
                      (*)
                  1.05
                      (*)April
                      30, 2005
                  1.75
                  1.47
 (*)
          did
          not trade during the period
 -
          The
          above represents the average high/low trade for the applicable
          quarter.
 
 
 There
          are
          no plans, proposals, arrangements or understandings with any person with
          regards
          to the development of a trading market in any of our securities.
 
 **Holders**
 
 As
          at
          July 3, 2005 the shareholders' list of our common shares showed 35 registered
          shareholders and 19,812,500 shares outstanding.
 
 There
          are
          no outstanding options or warrants to purchase, or securities convertible
          into
          our common shares.
 
 **Dividends**
 
 We
          have
          not declared any cash dividends with respect to our common stock since
          incorporation and we do not anticipate that we will do so in the foreseeable
          future. Although there are no material restrictions limiting, or that are
          likely
          to limit our ability to pay dividends on our common stock, our intention
          is to
          retain future earnings for use in our operations and the expansion of our
          business
 
 **Recent
          Sales of Unregistered Securities**
 
 There
          were no sales of unregistered securities during the year ended April 30,
          2005.
 
 
 **ITEM
                    6.**
                **MANAGEMENT'S
                    DISCUSSION AND ANALYSIS AND PLAN OF OPERATION.**
 
 **Cautionary
          Statement Regarding Forward-looking Statements**
 
 Some
          discussions in this report may contain forward-looking statements that
          involve
          risks and uncertainties. A number of important factors could cause our
          actual
          results to differ materially from those expressed in any forward-looking
          statements made by us in this report. Such factors include, those discussed
          in
          "Risk Factors", "Management's Discussion and Analysis of Financial Condition
          and
          Results of Operations" and "Business", as well as those discussed elsewhere
          in
          this report. Forward-looking statements are often identified by words like:
          believe, expect, estimate, anticipate, intend, project and similar expressions,
          or words which, by their nature, refer to future events.
 
 
 
 The
          following discussion and analysis of the Company's financial condition
          and
          results of operations should be read in conjunction with the Financial
          Statements and accompanying notes and the other financial information appearing
          elsewhere in this Report.
 
 **Plan
          of Operation**
 
 North
          American Natural Gas, Inc. is in the development stage. In a development
          stage
          company, management devotes most of its activities in developing a market
          for
          its products. Planned principal activities have not yet begun.
 
 During
          the period from March 24, 2000 through April 30, 2005, the Company has
          engaged
          in no significant operations other than organizational activities, acquisition
          of the rights to market Vitamineralherb.com, preparation for registration
          of its
          securities under the Securities Act of 1933, as amended, preparation of
          a
          supplementary business plan and completing a private placement to fund
          this
          secondary division. No revenues were received by the Company during this
          period.
 
 During
          the fourth quarter of fiscal 2003, the Company changed its name to North
          American Natural Gas, Inc. as it had anticipated that it would undertake
          a new
          business purpose in the oil and gas exploration industry. The Company entered
          into agreements to purchase interests in two oil and gas exploration
          opportunities subject to raising a minimum of US$11,000,000 in a private
          offering. The Company was unsuccessful in its efforts to raise the minimum
          amount and all funds received were subsequently returned to the original
          subscribers. All agreements were terminated. The Company spent $85,683
          during
          the year in connection with the failed financing efforts.
 
 Subsequent
          to the end of 2003, after the Company was unsuccessful in its efforts to
          raise
          the required capital to change its business purpose, it reverted back to
          the
          original business to determine the feasibility of marketing the
          Vitamineralherb.com products in various markets, and, if the products prove
          to
          be in demand, begin marketing and selling Vitamineralherb.com
          products.
 
 During
          the fiscal year of 2003, the Company extended its license with
          Vitamineralherb.com for an additional three years to market vitamins, minerals,
          nutritional supplements and other health and fitness products in Minnesota
          through the Vitamineralherb.com web site. The license is now valid until
          April
          2006 subject to the payment of the annual fees.
 
 The
          Company's business plan in connection with the license to sell products
          through
          the Vitamineralherb.com web site was to determine the feasibility of selling
          products to targeted markets. In order to determine the feasibility of
          its
          business plan, the Company plans to conduct research into these various
          potential target markets. Should the Company determine that the exploitation
          of
          the license is feasible, it will engage salespeople to market the products.
          Based primarily on discussions with the licensor, the Company believes
          that
          during its first operational quarter, it will need a capital infusion of
          approximately $85,000 to achieve a sustainable sales level where ongoing
          operations can be funded out of revenues. This capital infusion is intended
          to
          cover costs of advertising, hiring and paying two salespeople and administrative
          expenses. In addition, the Company will need approximately $260,000 in
          the event
          it determines that its market will not pay in advance and it will have
          to extend
          credit. The Company will have to obtain additional financing through an
          offering
          or capital contributions by current shareholders. There can be no assurance
          that
          additional financing will be available on terms acceptable to the Company,
          or at
          all.
 
 The
          implementation of the Company's initial plans was delayed as Vitamineralherb.com
          re-worked its web site rendering it non-operational for a period of time.
          In
          addition, Vitamineralherb.com changed its primary supplier of products
          again
          delaying the Company's ability to initiate its business plan. The Company
          then
          looked at changing its business purpose to the oil and gas industry thus
          further
          delaying the implementation of the initial plans to determine the feasibility
          of
          selling the Vitamineralherb.com products. The Company's efforts to implement
          its
          initial business plan continues to be delayed as Vitamineralherb.com continues
          to modify its web site and to find a replacement supplier for its vitamin
          and
          mineral products to offer to its licensees. Vitamineralherb.com has now
          completed it revisions to its website and have found a replacement supplier
          for
          its vitamin and mineral products.
 
 
 
 In
          light
          of the numerous delays with the Vitamineralherb.com website and initial
          reaction
          to our preliminary market survey, we are reconsidering whether the exploitation
          of the Vitamineralherb.com license is feasible.
 
 We
          intend
          to continue to explore other business opportunities although we have not
          identified any new business opportunities and have no agreements related
          to such
          opportunities.
 
 On
          May
          17, 2005, Coreena Hansen resigned as Secretary of the Company. The position
          was
          assumed by Richard Achron, a current director, chief financial officer
          and
          treasurer of the company.
 
 **Results
          of Operations**
 
 ***From
          Inception on March 24, 2000 to April 30, 2005***
 
 The
          Company remains in the development stage. The balance sheet as of April
          30, 2005
          reflects cash of $15,078 against total liabilities of $5,124. We incurred
          a loss
          of $30,203 for the fiscal year ended April 30, 2005 and a total loss of
          $302,246
          from inception.
 
 The
          Company spent $85,683 in connection with the failed efforts to raise the
          $11,000,000 for the acquisition of the oil and gas properties.
 
 We
          spent
          $20,840 in professional fees related to maintaining the company's financial
          and
          corporate filing in fiscal 2005 as compared to $20,948 in 2004. Transfer
          agent
          and filing fees were $1,863 as compared to $3,077 in 2004.
 
 **Liquidity
          and Capital Resources**
 
 As
          of the
          date of this report, the Company has yet to generate any revenues from
          its
          business operations.
 
 We
          had
          cash on hand of $15,078 as at April 30, 2005 and working capital of $9,954
          compared to cash on hand of $44,236 and a working capital of $38,957 as
          at April
          30, 2004. We do not believe that we have sufficient funds to meet our
          administrative operating obligations for the next twelve months.
 
 We
          will
          need additional capital to carry out all of our obligations and business
          strategies. We intend to raise any additional capital required to fund
          our
          financing needs by issuance of debt and equity. Management has been exploring
          a
          number of other options to meet the Company's obligations and future capital
          requirements, including the possibility of equity offering, debt financing,
          and
          business combination. There can be no assurance financing will be available
          or
          accessible on reasonable terms, or at all.
 
 We
          may
          engage in a combination with another business. During the fiscal year of
          2003,
          we entered into agreements that would have changed our business to the
          oil and
          gas industry. We were unsuccessful in raising the minimum capital required
          to
          complete the transaction and subsequently terminated all the agreements.
          We have
          engaged in discussions concerning other potential business combinations,
          but
          have not entered into any agreement for such a combination.
 
 **Going
          Concern**
 
 The
          Company's failure to generate revenues and conduct operations since its
          inception raises substantial doubt about the Company's ability to continue
          as a
          going concern. We will require substantial working capital and currently
          has
          inadequate capital to fund all of its business strategies, which could
          severely
          limit our operations.
 We
          incurred a loss of $30,203 for the year ended April 30, 2005 and we have
          incurred an aggregate deficit since inception of $302,246. As at April
          30, 2005,
          we had cash of $15,078 and accounts payable and accrued liabilities of
          $5,124.
          As we have yet to commence operations, we have not generated any revenues
          and
          there can be no assurance that we can generate significant revenues from
          operations. We expect to incur administrative and professional charges
          associated with preparing, reviewing, auditing and filing our financial
          statements and our periodic and other disclosure documents. For the 12
          months
          ended April 30, 2006, we have budgeted $35,000 for professional fees for
          our
          periodic filing requirements and miscellaneous office and filing fees and
          expenses. We believe that we cannot sustain our operations from existing
          working
          capital and operations over the next 12 months. We intend to raise additional
          capital required to fund our financing needs by issuance of debt and/or
          equity.
          Management has been exploring a number of options to meet our obligations
          and
          future capital requirements, including the possibility of equity offering,
          debt
          financing, and business combination.
  The
          financial statements included in this annual report have been prepared
          on the
          going-concern basis, which assumes that adequate sources of financing will
          be
          obtained as required and that our assets will be realized and liabilities
          settled in the ordinary course of business. Accordingly the audited financial
          statements do not include any adjustments related to the recoverability
          of
          assets and classification of assets and liabilities that might be necessary
          should we be unable to continue as a going concern.
 
 In
          order
          to continue as a going concern, we require additional financing. There
          can be no
          assurance that additional financial will be available to us when needed,
          or, if
          available, that it can be obtained on commercially reasonable
          terms.
 
 Due
          to
          the uncertainty of our ability to meet our current operating and capital
          expenses, in the audited financial statements for the fiscal year ended
          April
          30, 2005, our auditors had issued a going concern opinion. This means that
          the
          auditors believed there is doubt that we can continue as an on-going business
          unless we obtain additional capital to maintain its existence and to commence
          its operations.
 
 **Recently
          Issued Accounting Standards**
 
 In
          December 2004, the Financial Accounting Standards Board (FASB) issued Statement
          of Financial Accounting Standard (SFAS) No. 123R, "Share Based Payment".
          SFAS
          123R is a revision of SFAS No. 123 "Accounting for Stock-Based Compensation",
          and supercedes APB Opinion No. 25, "Accounting for Stock Issued to Employees"
          and its related implementation guidance. SFAS 123R establishes standards
          for the
          accounting for transactions in which an entity exchanges its equity instruments
          for goods or services. It also addresses transactions in which an entity
          incurs
          liabilities in exchange for goods or services that are based on the fair
          value
          of the entity's equity instruments or that may be settled by the issuance
          of
          those equity instruments. SFAS 123R focuses primarily on accounting for
          transactions in which an entity obtains employee services in share-based
          payment
          transactions. SFAS 123R does not change the accounting guidance for share-based
          payment transactions with parties other than employees provided in SFAS
          123 as
          originally issued and Emerging Issues Task Force Issue No. 96-18. "Accounting
          for Equity Instruments That Are Issued to Other Than Employees for Acquiring,
          or
          in Conjunction with Selling, Goods or Services". SFAS 123R does not address
          the
          accounting for employee share ownership plans, which are subject to AICPA
          Statement of Position 93-6, "Employers' Accounting for Employee Stock Ownership
          Plans". SFAS 123R requires a public entity to measure the cost of employee
          services received in exchange for an award of equity instruments based
          on the
          grant-date fair value of the award (with limited exceptions). That cost
          will be
          recognized over the period during which an employee is required to provide
          service in exchange for the award - the requisite service period (usually
          the
          vesting period). SFAS 123R requires that the compensation cost relating
          to the
          share-based payment transactions be recognized in financial statements.
          That
          cost will be measured based on the fair value of the equity or liability
          instruments issued. The scope of SFAS 123R includes a wide range of share-based
          compensation arrangements including share options, restricted share plans,
          performance-based awards, share appreciation rights, and employee share
          purchase
          plans. Public entities (other than those filing as small business issuers)
          will
          be required to apply SFAS 123R as of the first interim or annual reporting
          period that begins after June 15, 2005. Public entities that file as small
          business issuers will be required to apply SFAS 123R in the first interim
          or
          annual reporting period that begins after December 15, 2005. For nonpublic
          entities, SFAS 123R must be applied as of the beginning of the first annual
          reporting period beginning after December 15, 2005. The adoption of this
          standard is not expected to have a material effect on the Company's results
          of
          operations or financial position.
 
 
 
 In
          December 2004, FASB issued SFAS No. 153, "Exchange of Nonmonetary Assets-An
          Amendment of APB Opinion No. 29". The guidance in APB Opinion No. 29,
          "Accounting for Nonmonetary Transactions", is based on the principle that
          exchanges of nonmonetary assets should be measured based on the fair value
          of
          the assets exchanged. The guidance in that Opinion, however, included certain
          exceptions to that principle. SFAS No. 153 amends Opinion No. 29 to eliminate
          the exception for nonmonetary exchanges of similar productive assets and
          replaces it with a general exception for exchanges of nonmonetary assets
          that do
          not have commercial substance. A nonmonetary exchange has commercial substance
          if the future cash flows of the entity are expected to change significantly
          as a
          result of the exchange. The provisions of SFAS No. 153 are effective for
          nonmonetary asset exchanges occurring in fiscal periods beginning after
          June 15,
          2005. Early application is permitted and companies must apply the standard
          prospectively. The adoption of this standard is not expected to have a
          material
          effect on the Company's results of operations or financial
          position.
 
 In
          March
          2005, the SEC staff issued Staff Accounting Bulletin No. 107 ("SAB No.
          107") to
          give guidance on the implementation of SRAS 123R. The Company will consider
          SAB
          No. 107 during the implementation of SFAS 123R.
 
 **Critical
          Accounting Policies**
 
 The
          Company's discussions and analysis of its financial condition and results
          of
          operations, including the discussion on liquidity and capital resources,
          are
          based upon the Company's financial statements, which have been prepared
          in
          accordance with US GAAP. The preparation of these financial statements
          requires
          the Company to make estimates and judgments that affect the reported amounts
          of
          assets, liabilities, revenues and expenses, and related disclosure of contingent
          assets and liabilities.
 
 The
          financial statements have been prepared on the going concern basis, which
          assumes that the Company will be able to realize its assets and discharge
          its
          obligations in the normal course of business.  If the Company were not to
          continue as a going concern, it would likely not be able to realize its
          assets
          at values comparable to the carrying value or the fair value estimates
          reflected
          in the balances set out in the preparation of the financial statements.
           The Company will require additional capital to fund any future plan of
          operations.  There can be no assurance that the Company will be able to
          raise additional capital, and if the Company is unable to raise additional
          capital, it will unlikely be able to continue as a going concern.
 
 **ITEM
                    7.**
                **FINANCIAL
                    STATEMENTS**
 
 Our
          financial statements are stated in United States Dollars (US$). The Report
          of
          our Independent Registered Public Accounting Firm, Manning Elliott, Chartered
          Accountants for the audited financial statements for the years ended April
          30,
          2005 and 2004 is included herein immediately preceding the audited financial
          statements at the end of this Report.
 
 **ITEM
                    8.**
                **CHANGES
                    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
                    DISCLOSURE.**
 
 There
          have been no disagreements on accounting and financial disclosures from
          the
          inception of the Company through the date of this Form 10-KSB. Our financial
          statements for the period from inception to April 30, 2005, included in
          this
          report have been audited by Manning Elliott, Chartered Accountants,
          11 th Floor,
          1050 West Georgia Street, Vancouver, British Columbia, Canada V6E 3S7 as
          set
          forth in their report included herein.
 
 
 
 **ITEM
                    8A.**
                **CONTROLS
                    AND PROCEDURES.**
 
 As
          required by Rule 13a-15 under the Securities Exchange Act of 1934, as of
          the end
          of the period covered by the annual report, being April 30, 2005, we have
          carried out an evaluation of the effectiveness of the design and operation
          of
          our company's disclosure controls and procedures. This evaluation was carried
          out under the supervision and with the participation of our company's
          management, including our company's president and our company's chief financial
          officer. Based upon that evaluation, our company's president and our company's
          chief financial officer concluded that our company's disclosure controls
          and
          procedures are effective as at the end of the period covered by this report.
          There have been no significant changes in our internal controls over financial
          reporting that occurred during our most recent fiscal quarter that have
          materially affected, or are reasonably likely to materially affect our
          internal
          controls over financial reporting.
 
 Disclosure
          controls and procedures and other procedures that are designed to ensure
          that
          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 time period specified in the Securities and Exchange Commission's
          rules and forms. Disclosure controls and procedures include, without limitation,
          controls and procedures designed to ensure that information required to
          be
          disclosed in our reports filed under the Securities Exchange Act of 1934
          is
          accumulated and communicated to management including our president and
          secretary
          as appropriate, to allow timely decisions regarding required
          disclosure.
 
 **Item
                    8B.**
                **OTHER
                    INFORMATION**
 
 None
 **PART
          III**
 
 **ITEM
                    9.**
                **DIRECTORS,
                    EXECUTIVE OFFICERS, PROMOTORS AND CONTROL PERSONS; COMPLIANCE
                    WITH SECTION
                    16(a) OF THE EXCHANGE ACT.**
 
 The
          following table sets forth the name, age and position of each director
          and
          executive officer of North American Natural Gas, Inc:
 
 **Name**
                **Age**
                **Positions**
                **Date
                    First Elected or**
                  **Appointed**Jim
                    Glavas
                42
                Chief
                    Executive Officer, President, Director
                May
                    22, 2003Richard
                    Achron
                62
                Chief
                    Financial Officer, Treasurer/Secretary, Director
                May
                    22, 2003Dickson
                    Coatsworth
                35
                Director
                May
                    22, 2003
 
 
 **Background
          of Officers and Directors**
 
 ***Jim
          Glavas*** graduated from the Financial Management program at the British Columbia
          Institute of Technology in Vancouver, Canada in 1984. From there, he spent
          several years in the banking industry as a leasing administrator with First
          City
          Trust. In 1990 he changed career direction to become the General Sales
          Manager
          for Western Canada for Contour Distributors, a leading supplier and distributor
          of "top-of-the-line" appliances and high-end solid surface products.
 
 In
          April
          1996, Mr. Glavas purchased the exclusive Avonite solid surface countertops
          distribution rights for Western Canada and formed DG Pacific Distribution
          Ltd.
          As President and owner of DG Pacific, he was solely responsible for its
          strong
          year after year growth increasing its customer base over 350% in three
          years and
          further multiplying its sales over the last two years. In January 2001,
          DG
          Pacific Distribution Ltd. acquired the national distribution rights for
          two
          prominent product lines in the countertop industry. Mr. Glavas sold DG
          Pacific
          Distribution Ltd. in December 2002 and currently works as an independent
          consultant in development and market penetration for the counter top
          industry.
 
 
 
 ***Richard
          Achron*** is
          a
          self-employed businessman with over 40 years experience in the retail/wholesale
          and manufacturing industry. He spent a number of years working for major
          Canadian corporations in sales, sales management and as a branch manager.
          These
          corporations included Philips Electronics, White-Westinghouse, Canadian
          Admiral
          Corporation and Sanyo Electronics. Since February 1989 he has been President
          and
          sole shareholder of Kingman Industries Ltd., a manufacturing business located
          in
          Vancouver, Canada. Kingman Industries Ltd. distributes products for usage
          in the
          food industry. His customer base includes major food chains such as Canada
          Safeway, Overwaitea Food Group and Superstore/Loblaws.
 
 Mr.
          Achron was the President and Director of Oban Mining Inc. a Company listed
          for
          trading on the OTC.BB from September2001. He resigned as President of Oban
          Mining Inc. in November2003 and as a Director in January2004.
 
 ***Dickson
          Coatsworth*** attended
          Fanshawe College in London, Ontario in the specialized field of Radio
          Broadcasting. From 1993 he produced radio shows on CJBX FM (BX93), a country
          radio station in London, Ontario, Canada. From 1995 to 1999 Mr. Coatsworth
          was
          employed by the Bayshore Broadcasting Corporation as music director and
          morning
          show host for MIX 106 in Owen Sound, Ontario, Canada while concurrently
          hosting
          several charity events such as the Annual Christmas Toy Drive and Coats
          for Kids
          Campaign.
 
 From
          1999
          to 2000 he was with Chorus Entertainment, Magic 106.1 in Guelph, Ontario
          Canada
          as morning show host and Master of Ceremonies for several public events
          and
          fundraisers such as Police Service Awards and the United Way Campaign.
          Since he
          relocated to British Columbia in 2000, Mr. Coatsworth has been Director
          of
          Activities at Clayoquot Wilderness Resort.
 
 **Involvement
          in Certain Legal Proceedings**
 
 To
          our
          knowledge, during the past five years, our officers and directors has:
          (1) not
          filed a petition under the federal bankruptcy laws or any state insolvency
          law,
          nor had a receiver, fiscal agent or similar officer appointed by a court
          for the
          business or present of such a person, or any partnership in which he was
          a
          general partner at or within two yeas before the time of such filing, or
          any
          corporation or business association of which he was an executive officer
          within
          two years before the time of such filing; (2) were convicted in a criminal
          proceeding or named subject of a pending criminal proceeding (excluding
          traffic
          violations and other minor offenses); (3) were the subject of any order,
          judgment or decree, not subsequently reversed, suspended or vacated, of
          any
          court of competent jurisdiction, permanently or temporarily enjoining him
          from
          or otherwise limiting the following activities: (i) acting as a futures
          commission merchant, introducing broker, commodity trading advisor, commodity
          pool operator, floor broker, leverage transaction merchant, associated
          person of
          any of the foregoing, or as an investment advisor, underwriter, broker
          or dealer
          in securities, or as an affiliated person, director of any investment company,
          or engaging in or continuing any conduct or practice in connection with
          such
          activity; (ii) engaging in any type of business practice; (iii) engaging
          in any
          activity in connection with the purchase or sale of any security or commodity
          or
          in connection with any violation of federal or state securities laws or
          federal
          commodity laws; (4) were the subject of any order, judgment or decree,
          not
          subsequently reversed, suspended or vacated, of any federal or state authority
          barring, suspending or otherwise limiting for more than 60 days the right
          of
          such person to engage in any activity described above under this Item,
          or to be
          associated with persons engaged in any such activity; (5) were found by
          a court
          of competent jurisdiction in a civil action or by the Securities and Exchange
          Commission to have violated any federal or state securities law and the
          judgment
          in subsequently reversed, suspended or vacate; (6) were found by a court
          of
          competent jurisdiction in a civil action or by the Commodity Futures Trading
          Commission to have violated any federal commodities law, and the judgment
          in
          such civil action or finding by the Commodity Futures Trading Commission
          has not
          been subsequently reversed, suspended or vacated.
 
 
 
 **Compliance
          with Section 16(a) of the Exchange Act**
 
 Section
          16(a) of the Securities Exchange Act of 1934, as amended, requires our
          executive
          officers and directors and persons who own more than 10% of a registered
          class
          of our equity securities to file with the Securities and Exchange Commission
          initial statements of beneficial ownership, reports of changes in ownership
          and
          annual reports concerning their ownership of our common stock and other
          equity
          securities on Forms 3,4, and 5 respectively. Executive officers, directors
          and
          greater than 10% shareholders are required by the Securities and Exchange
          Commission regulations to furnish us with copies of all Section 16(a) reports
          they file.
 
 To
          the
          best knowledge of the Company, all directors, officers and persons who
          beneficially owned more than ten percent of the Company's common stock
          filed
          timely reports in compliance with Section 16(a).
 
 **Audit
          Committee**
 
 We
          do not
          have an audit committee or an audit committee charter.
 
 **Audit
          Committee Financial Expert**
 
 Our
          Board
          of Directors has determined that it does not have an audit committee financial
          expert as defined in Item 401(e) of Regulation S-B, and is independent
          as the
          term is used in Item 7(d)(3)(iv) of Schedule 14A under the Securities Exchange
          Act of 1934 as amended. We believe that the members of our Board of Directors
          are collectively capable of analyzing and evaluating our financial statements
          and understanding internal controls and procedures for disclosure and for
          financial reporting. In addition, we believe that retaining an independent
          director who would qualify as an "audit committee financial expert" would
          be
          overly costly and burdensome and not warranted in our circumstances given
          the
          early stages of our development and the fact that we have not generated
          any
          revenues to date.
 
 **Code
          of Ethics**
 
 The
          Company has adopted a code of business conduct and ethics for directors,
          officers and employees.
 
 **Family
          Relationships**
 
 There
          are
          no family relationships amongst or between the directors and executive
          officers.
 
 **ITEM
                    10.**
                **EXECUTIVE
                    COMPENSATION.**
 
 The
          following table sets forth information with respect to compensation paid
          by the
          Company to the Chief Executive Officer and the other highest paid executive
          officers (the Named Executive Officer) during the three most recent fiscal
          years.
 
 
 
  **Summary
                    Compensation Table******
                ****
                ****
                ****
                ****
                **Long
                    Term Compensation**
                ****
                ********
                ****
                **Annual
                    Compensation**
                **Awards**
                ****
                **Payouts**
                ******(a)**
                **(b)**
                **(c)**
                **(d)**
                **(e)**
                **(f)**
                **(g)**
                **(h)**
                **(i)****Name
                    and**
                  **Principal**
                  **Position**
                **Year**
                **Salary**
                  **($)**
                **Bonus**
                  **($)**
                **Other**
                  **Annual**
                  **Compen-**
                  **sation**
                  **($)**
                **Restricted**
                  **Stock**
                  **Award(s)**
                  **($)**
                **Securities**
                  **Underlying**
                  **Options/**
                  **SARs**
                  **(#)**
                **LTIP**
                  **Payouts**
                  **($)**
                **All
                    Other**
                  **Compen-**
                  **sation
                    ($)**Jim
                  Glavas
                2005
                0
                0
                0
                0
                0
                0
                0CEO,
                  President, &
                2004
                0
                0
                0
                0
                0
                0
                0Director
                2003
                0
                0
                0
                0
                0
                0
                0Harry
                  J.
                  Briscoe
                2005
                n/a
                n/a
                n/a
                n/a
                n/a
                n/a
                n/aFormer
                  CEO,
                2004
                n/a
                n/a
                n/a
                n/a
                n/a
                n/a
                n/aPresident
                  &
                2003
                0
                0
                0
                0
                0
                0
                0Director
  There
          are
          no stock option, retirement, pension, or profit sharing plans for the benefit
          of
          our officers and directors.
 
 **Option/SAR
          Grants**
 
 No
          individual grants of stock options, whether or not in tandem with stock
          appreciation rights ("SARs") and freestanding SARs have been made to any
          executive officers or any directors since our inception, accordingly, no
          stock
          options have been exercised by officers or directors in fiscal
          2005.
 
 **Long-Term
          Incentive Plan Awards**
 
 The
          Company does not have any long-term incentive plans that provide compensation
          intended to serve as incentive for performance to occur over a period longer
          than one fiscal year, whether such performance is measured by reference
          to our
          financial performance, our stock price, or any other measure.
 
 
 **Compensation
          of Directors**
 
 An
          independent director was paid $6,000 for fees in fiscal 2005. There are
          no
          standard arrangements pursuant to which the Company's directors are compensated
          for services provided as director.
 
 **Employment
          Contracts and Termination of Employment and Change-in-Control
          Arrangements**
 
 None
 
 **Report
          on Repricing of Options/SAR**
 
 The
          Company did not reprice any options or SARS during the year ended April
          30,
          2004.
 
 **Indemnification**
  Pursuant
          to the articles of incorporation and bylaws of the corporation, we may
          indemnify
          an officer or director who is made a party to any proceeding, including
          a
          lawsuit, because of his position, if he acted in good faith and in a manner
          he
          reasonably believed to be in our best interest. In certain cases, we may
          advance
          expenses incurred in defending any such proceeding. To the extent that
          the
          officer or director is successful on the merits in any such proceeding
          as to
          which such person is to be indemnified, we must indemnify him against all
          expenses incurred, including attorney's fees. With respect to a derivative
          action, indemnity may be made only for expenses actually and reasonably
          incurred
          in defending the proceeding, and if the officer or director is judged liable,
          only by a court order. The indemnification is intended to be to the fullest
          extent permitted by the laws of the state Washington.
 
 Regarding
          indemnification for liabilities arising under the Securities Act of 1933
          which
          may be permitted to directors or officers pursuant to the foregoing provisions,
          we are informed that, in the opinion of the Securities and Exchange Commission,
          such indemnification is against public policy, as expressed in the Act
          and is,
          therefore unenforceable.
 
 
 
 **ITEM
                    11.**
                **SECURITY
                    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
                    STOCKHOLDER MATTERS.**
 
 **Security
          Ownership of Certain Beneficial Owners**
 
 The
          following table sets forth, as of July 3, 2005, the beneficial shareholdings
          of
          persons or entities holding five percent or more of our common stock, our
          directors and executive officers individually, and our directors and officers
          as
          a group. Each person has sole voting and investment power with respect
          to the
          shares of common stock shown, and all ownership is of record and
          beneficial
 
 **Name
                    of Beneficial Owner**
                
                **Amount
                    and Nature of**
                  **Beneficial
                    Owner(1)**
                
                **Percent**
                  **Of
                    Class**Jim
                    Glavas
                  2366
                    West 12thAvenue
                  Vancouver,
                    British Columbia
                  Canada
                    V6K 2N9
                  CEO,
                    President and Director
                
                12,312,500
                
                62.14%Richard
                    Achron
                  11960
                    Hammersmith Way, #155
                  Richmond,
                    British Columbia
                  Canada
                    V7A 5C9
                  CFO
                    and Director
                
                Nil
                
                0.00%Dickson
                    Coatsworth
                  390
                    Main Street
                  Tofino,
                    British Columbia
                  Canada
                    V0R 2Z0
                  Director
                
                Nil
                
                0.00%
  All
          directors and executive officers as a group hold 12,312,500 common shares
          representing 62.14% (4 persons)
 
 **Changes
          in Control**
 
 To
          the
          knowledge of management, there are no present arrangements or pledges of
          the
          Company's securities that may result in a change in control of the
          Company.
 
 **Securities
          Authorized for Issuance Under Compensatory Plans**
 
 The
          Company has no compensation plans (including individual compensation
          arrangements) under which securities are authorized for issuance.
 
 **ITEM
                    12.**
                **CERTAIN
                    RELATIONSHIPS AND RELATED TRANSACTIONS.**
 
 No
          director, executive officer or nominee for election as a director of North
          American Natural Gas, Inc., and no owner of five percent or more of the
          Company's outstanding shares or any member of their immediate family has
          entered
          into or proposed any transaction in which the amount involved exceeds
          $60,000.
  **ITEM
                    13.**
                **EXHIBITS,
                    AND REPORTS ON FORM 8-K.**
 
 **(a)**
                **Exhibits**
  
  14.1
                Code
                    of Ethics31.1
                Certification
                    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief
                    Executive Officer31.2
                Certification
                    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief
                    Financial Officer32.1
                Certification
                    pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                    906 of
                    the Sarbanes-Oxley Act of 2002 - Chief Executive
                    Officer32.2
                Certification
                    pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                    906 of
                    the Sarbanes-Oxley Act of 2002 - Chief Financial
                    Officer
 
 Index
          to
          Exhibits Incorporated by Reference
 
 3.1
                Articles
                    of Incorporation (1)3.2
                Certificate
                    of Amendment to Certificate of Incorporation (2)3.3
                Bylaws
                    (3)10.1
                License
                    Agreement dated April 13, 2000 between the Registrant and
                    Vitamineralherb.com Corp. (4)10.2
                Assignment
                    of License Agreement dated April 13, 2000 between Frank Roberts
                    and
                    Registrant. (5)10.3
                Promissory
                    Note dated April 13, 2000 between Registrant and Vitamineralherb.com
                    Corp.
                    (6)
 
 Exhibits
          Incorporated by Reference
 (1)
                  Filed
                      as an exhibit to Registrant's SB2 Registration Statement on
                      June 2, 2000
                      and incorporated herein by reference.(2)
                  Filed
                      as an exhibit to Registrant's Form 8K on March 25, 2003 and
                      incorporated
                      herein by reference.(3)
                  Filed
                      as an exhibit to Registrant's SB2 Registration Statement on
                      June 2, 2000
                      and incorporated herein by reference.(4)
                  Filed
                      as an exhibit to Registrant's SB2 Registration Statement on
                      June 2, 2000
                      and incorporated herein by reference.(5)
                  Filed
                      as an exhibit to Registrant's SB2 Registration Statement on
                      June 2, 2000
                      and incorporated herein by reference.(6)
                  Filed
                      as an exhibit to Registrant's SB2 Registration Statement on
                      June 2, 2000
                      and incorporated herein by
                      reference.
 **(b)**
                **Reports
                    on Form 8-K**
 
 None
 
 **ITEM
                    14.**
                **PRINCIPAL
                    ACCOUNTANT FEES AND
                    SERVICES.**
 
 The
          following table sets forth fees for services Manning Elliott, Chartered
          Accountants provided during fiscal years 2005 and 2004:
  2005
                  2004Audit
                      Fees (1)
                  $
                      5,265
                  $
                      4,900Audit-related
                      fees (2)
                  0
                  0Tax
                      fees (3)
                  $
                      550
                  $
                      550All
                      other fees (4)
                  0
                  0Total
                  $
                      5,815
                  $
                      5,450 (*)
 (*)
          an
          over-accrual of $1,000 was adjusted in the subsequent year
 
 
 
 (1)
                Represents
                    fees for professional services provided in connection with the
                    audit of
                    the Company's annual financial statements and review of the Company's
                    quarterly financial statements, advice on accounting matters
                    that arose
                    during the audit and audit
                    services.
 (2)
                During
                    fiscal 2005 and 2004, the Company did not incur fees for assurance
                    and
                    related services that are reasonably related to the performance
                    of the
                    audit or review of financial statements and are not reported
                    elsewhere.
 (3)
                Represents
                    fees for services and advice provided in connection with the
                    preparation
                    of the Company's federal and state tax
                    returns.
 (4)
                During
                    fiscal 2005 and 2004 the Company did not incur any other fees
                    related to
                    the Company's financial statements and other services
                    provided.
 
 The
          Company's Board of Directors has determined that the provision of
          non-audit services by Manning Elliott, Chartered Accountants, is compatible
          with maintaining Manning Elliott's independence, and none of such services
          were
          pre-approved pursuant to the *de
          minimis* exception provided in Section 10A(i)(1)(B) of the Securities Exchange Act
          of
          1934.
 
 The
          percentage of hours expended on the principal accountant's engagement to
          audit
          our financial statements for the most recent fiscal year that were attributed
          to
          work performed by persons other than the principal accountant's full time,
          permanent employees was 0%.
 
 
 
 **SIGNATURES**
 
 Pursuant
          to the requirements of Section 13 or 15(d) of the Securities and Exchange
          Act of
          1934, the Registrant has duly caused this report to be signed on its behalf
          by
          the undersigned, thereunto duly authorized, on this 6 day of July, 2005.
 
 **NORTH
                    AMERICAN NATURAL GAS, INC.**
                  (Registrant)BY:
                */s/ Jim Glavas*Jim
                    Glavas, President, Principal Executive Officer and member of
                    the Board of
                    Directors
 
 
 Pursuant
          to the requirements of the Securities Exchange Act of 1934, this report
          has been
          signed below by the following person on behalf of the Registrant and in
          the
          capacities.
 
 **Signatures**
                **Title**
                
                **Date***/s/
                    Jim Glavas*
                President,
                    Principal Executive Officer, and a
                
                6/07/2005Jim
                    Glavas
                member
                  of the Board of Directors*/s/
                    Richard Achron*
                Principal
                    Financial Officer, and a member of
                
                6/07/2005Richard
                    Achron
                the
                  Board of Directors











Report
        of Independent Registered Public Accounting Firm
 
 
 To
        the
        Stockholders and Board of Directors
 of
        North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 
 We
        have
        audited the accompanying balance sheets of North American Natural Gas Inc.
        (A
        Development Stage Company) as of April 30, 2005 and 2004 and the related
        statements of operations, stockholders' equity and cash flows accumulated
        for
        the period from March 24, 2000 (Date of Inception) to April 30, 2005 and
        the years ended April 30, 2005 and 2004. These financial statements are the
        responsibility of the Company's management. Our responsibility is to express
        an
        opinion on these financial statements based on our audits.
 
 We
        conducted our audits in accordance with the Standards of the Public Company
        Accounting Oversight Board (United States). Those standards require that
        we plan
        and perform the audit to obtain reasonable assurance about whether the financial
        statements are free of material misstatement. An audit includes examining,
        on a
        test basis, evidence supporting the amounts and disclosures in the financial
        statements. An audit also includes assessing the accounting principles used
        and
        significant estimates made by management, as well as evaluating the overall
        financial statement presentation. We believe that our audits provide a
        reasonable basis for our opinion.
 
 In
        our
        opinion, the financial statements referred to above present fairly, in all
        material respects, the financial position of North American Natural Gas Inc.
        (A
        Development Stage Company), as of April 30, 2005 and 2004, and the results
        of
        its operations and its cash flows accumulated for the period from March 24,
        2000 (Date of Inception) to April 30, 2005 and the years ended
        April 30, 2005 and 2004, in conformity with accounting principles generally
        accepted in the United States.
 
 The
        accompanying financial statements have been prepared assuming the Company
        will
        continue as a going concern. As discussed in Note 1 to the financial statements,
        the Company has not generated any revenues and has accumulated losses since
        inception. These factors raise substantial doubt about the Company's ability
        to
        continue as a going concern. Management's plans in regard to these matters
        are
        also discussed in Note 1. The financial statements do not include any
        adjustments that might result from the outcome of this uncertainty.
 
 
 /s/
        "Manning Elliot"
 
 
 CHARTERED
        ACCOUNTANTS
  Vancouver,
        Canada
  July
        5,
        2005 North
        American Natural Gas Inc.
  
  North
        American Natural Gas, Inc.
 (A
        Development Stage Company)
 Balance
        Sheets
 (Expressed
        in U.S. dollars)
  April
                  30,
                2005
                $
              
              April
                  30,
                2004
                $ASSETSCurrent
                  AssetsCash
              
              
              15,078
              
              
              44,236Total
                  Assets
              
              
              15,078
              
              
              44,236LIABILITIES
                  AND STOCKHOLDERS' EQUITYCurrent
                  LiabilitiesAccounts
                  payable
              
              
              651
              
              
              429Accrued
                  liabilities
              
              
              4,473
              
              
              4,850Total
                  Liabilities
              
              
              5,124
              
              
              5,279Contingency
                  (Note 1)Stockholders'
                  EquityPreferred
                  Stock: $.0001 par value; authorized 20,000,000preferred
                  shares; none issued (Note 6)
              
              
              -
              
              
              -Common
                  Stock: $0.0001 par value; authorized 100,000,000 commonshares;
                  19,812,5000 shares issued and outstanding (Note 5)
              
              
              1,981
              
              
              1,981Additional
                  Paid-in Capital
              
              
              310,219
              
              
              309,019Deficit
                  Accumulated During the Development Stage
              
              
              (302,246
              )
              
              (272,043
              )Total
                  Stockholders' Equity
              
              
              9,954
              
              
              38,957Total
                  Liabilities and Stockholders' Equity
              
              
              15,078
              
              
              44,236
 
 
 (See
        Accompanying Notes to the Financial Statements)
  
  North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 Statements
        of Operations
 (Expressed
        in U.S. dollars)
 Accumulated
                March
                  24, 2000
              
              Year
                  Ended(Date
                  of Inception)
                to
                  April 30, 2005
                $
              
              April
                  30,
                2005
                $
              
              April
                  30,
                2004
                $Revenue
              
              -
              
              -
              
              -ExpensesBusiness
                  development
              
              
              24,475
              
              
              -
              
              
              -Consulting
                  fees
              
              
              25,000
              
              
              -
              
              
              -Director's
                  fee
              
              
              17,000
              
              
              6,000
              
              
              6,000Finance
                  costs
              
              
              75,975
              
              
              -
              
              
              15,292License
                  written-off
              
              
              35,000
              
              
              -
              
              
              -Professional
                  fees
              
              
              101,703
              
              
              20,840
              
              
              20,948Office
                  and rent (Note 7)
              
              
              10,788
              
              
              1,500
              
              
              1,345Transfer
                  agent and filing fees
              
              
              14,150
              
              
              1,863
              
              
              3,077Less
                  interest income
              
              
              (1,845
              )
              
              -
              
              
              (457
              )Total
                  Expenses
              
              
              302,246
              
              
              30,203
              
              
              46,205Net
                  Loss For The Period
              
              
              (302,246
              )
              
              (30,203
              )
              
              (46,205
              )Net
                  loss Per Share - Basic and Diluted
              
              
              -
              
              
              -
              
              
              -Weighted
                  Average Number of Shares Outstanding
              
              
              
              
              
              19,812,000
              
              
              19,812,000
 
 
 (See
        Accompanying Notes to the Financial Statements)
  
  North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 Statement
        of Stockholders' Equity
 From
        March 24, 2000 (Date of Inception) to April 30, 2005
 (Expressed
        in U.S. dollars)
  Common
                Shares
              
              Stock
                Amount
              
              Additional
                Paid-in
                Capital
              
              Deficit
                Accumulated
                During
                  the
                Development
                Stage
              
              Total#
              
              $
              
              $
              
              $
              
              $Balance
                  - March 24, 2000 (Date of Inception)
              
              -
              
              -
              
              -
              
              -
              
              -Stock
                  issued for legal and organizational expenses at fair market value
                  of 0.01
                  per share
              
              
              12,000,000
              
              
              1,200
              
              
              14,800
              
              
              
              
              
              16,000Net
                  loss for the period
              
              
              -
              
              
              -
              
              
              -
              
              
              (51,000
              )
              
              (51,000
              )Balance-April
                  30, 2000
              
              
              12,000,000
              
              
              1,200
              
              
              14,800
              
              
              (51,000
              )
              
              (35,000
              )Stock
                  issued for cash at $0.01 per share
              
              
              7,500,000
              
              
              750
              
              
              9,250
              
              
              -
              
              
              10,000Net
                  loss for the year
              
              
              -
              
              
              -
              
              
              -
              
              
              (12,588
              )
              
              (12,588
              )Balance
                  - April 30, 2001
              
              
              19,500,000
              
              
              1,950
              
              
              24,050
              
              
              (63,588
              )
              
              (37,588
              )Net
                  loss for the year
              
              
              -
              
              
              -
              
              
              -
              
              
              (27,067
              )
              
              (27,067
              )Balance
                  - April 30, 2002
              
              
              19,500,000
              
              
              1,950
              
              
              24,050
              
              
              (90,655
              )
              
              (64,655
              )Stock
                  issued for cash at $1.00 per share
              
              
              312,500
              
              
              31
              
              
              249,969
              
              
              -
              
              
              250,000Extinguishment
                  of Note Payable (Note 5)
              
              
              -
              
              
              -
              
              
              35,000
              
              
              -
              
              
              35,000Net
                  loss for the year
              
              
              -
              
              
              -
              
              
              -
              
              
              (135,183
              )
              
              (135,183
              )Balance
                  - April 30, 2003
              
              
              19,812,500
              
              
              1,981
              
              
              309,019
              
              
              (225,838
              )
              
              85,162Net
                  loss for the year
              
              
              -
              
              
              -
              
              
              -
              
              
              (46,205
              )
              
              (46,205
              )Balance
                  - April 30, 2004
              
              
              19,812,500
              
              
              1,981
              
              
              309,019
              
              
              (272,043
              )
              
              38,957Donated
                  rent
              
              
              -
              
              
              -
              
              
              1,200
              
              
              -
              
              
              1,200Net
                  loss for the year
              
              
              -
              
              
              -
              
              
              -
              
              
              (30,203
              )
              
              (30,203
              )Balance
                  - April 30, 2005
              
              
              19,812,500
              
              
              1,981
              
              
              310,219
              
              
              (302,246
              )
              
              9,954
 
 
 (See
        Accompanying Notes to the Financial Statements)
  
  North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 Statements
        of Cash Flow
 (Expressed
        in U.S. dollars)
  Accumulated
                  March
                    24, 2000
                  (Date
                    of Inception)
                  To
                    April 30, 2005
                
                Year
                    Ended
                  April
                    30
                  2005
                
                Year
                    Ended
                  April
                    30
                  2004$
                
                $
                
                $Cash
                    Flows From Operating Activities
                
                
                (302,246
                )
                
                (30,203
                )
                
                (46,205
                )Net
                    lossAdjustments
                    to reconcile net loss to cashLegal
                    and organizational costs
                
                
                16,000
                
                
                -
                
                
                -Licence
                    written off
                
                
                35,000
                
                
                -
                
                
                -Donated
                    rent
                
                
                1,200
                
                
                1,200
                
                
                -Change
                    in operating assets and liabilitiesIncrease
                    (decrease) in accounts payable and accrued liabilities
                
                
                5,124
                
                
                (155
                )
                
                (14,299
                )Share
                    subscriptions refundable (Note 4)
                
                
                -
                
                
                -
                
                
                (1,600,000
                )Net
                    Cash Used in Operating Activities
                
                
                (244,922
                )
                
                (29,158
                )
                
                (1,660,504
                )Cash
                    Flows From Financing ActivitiesCommon
                    shares issued
                
                
                260,000
                
                
                -
                
                
                -Net
                    Cash Provided by Financing Activities
                
                
                260,000
                
                
                -
                
                
                -Increase
                    (Decrease) In Cash
                
                
                15,078
                
                
                (29,158
                )
                
                (1,660,504
                )Cash
                    - Beginning of Year
                
                
                -
                
                
                44,236
                
                
                1,704,740Cash
                    - End of Year
                
                
                15,078
                
                
                15,078
                
                
                44,236Non
                    - Cash Investing and Financing ActivitiesA
                    total of 1,600,000 shares were issued to a director at a fair
                    market value
                    of $ 0.01 per share for legal and organizational expenses paid
                
                
                16,000
                
                
                -
                
                
                -A
                    note payable was assumed by the Company for the acquisition of
                    a License
                    from a former director which was forgiven on July 12, 2002 (Notes
                    4 and 5)
                
                
                35,000
                
                
                -
                
                
                -Supplemental
                    DisclosuresInterest
                    paid
                
                
                -
                
                
                -
                
                
                -Income
                    tax paid
                
                
                -
                
                
                -
                
                
                -
 
 
 (See
        Accompanying Notes to the Financial Statements)
  
  North
        American Natural Gas, Inc.
 (A
        Development Stage Company)
 Notes
        to
        the Financial Statements
 April
        30, 2005
   1.
              Development
                  Stage Company
 
 North
        American Natural Gas, Inc. herein (the "Company") was incorporated in the
        State
        of Washington, U.S.A. on March 24, 2000. The Company acquired a license to
        market and distribute vitamins, minerals, nutritional supplements, and other
        health and fitness products in which the grantor of the license offers these
        products for sale from various suppliers on their Web Site. The Company was
        also
        developing a marketing strategy to offer personal care products through a
        kiosk-based ordering system.
 
 During
        fiscal 2003 the Company changed its name from FAR Group, Inc. to North American
        Natural Gas, Inc. as it had anticipated that it would undertake a new business
        purpose in the oil and gas exploration industry. The Company was unsuccessful
        in
        its efforts to raise the required capital to acquire the oil and gas properties
        contemplated and reverted back to its original business to exploit the license
        to market and sell vitamins and other health and fitness products.
 
 The
        Company is in the development stage. In a development stage company, management
        devotes most of its activities in developing a market for its products. Planned
        principal activities have not yet begun. The ability of the Company to emerge
        from the development stage with respect to any planned principal business
        activity is dependent upon its successful efforts to raise additional equity
        financing and/or attain profitable operations. There is no guarantee that
        the
        Company will be able to raise any equity financing or sell any of its products
        at a profit. There is substantial doubt regarding the Company's ability to
        continue as a going concern.
 
 2.
              Summary
                  of Significant Accounting Policies
  (a)
              Basis
                  of Accounting
  These
        financial statements are prepared in conformity with accounting principles
        generally accepted in the United States of America and are presented in United
        States dollars.
  (b)
              Year
                  end
  The
        Company's fiscal year end is April 30.
  (c)
              Long-Lived
                  Assets
  In
        accordance with Financial Accounting Standards Board ("FASB") Statement of
        Financial Accounting Standards ("SFAS") No. 144, Accounting for the Impairment
        or Disposal of Long-Lived Assets", the carrying value of intangible assets
        and
        other long-lived assets is reviewed on a regular basis for the existence
        of
        facts or circumstances that may suggest impairment. The Company recognizes
        an
        impairment when the sum of the expected undiscounted future cash flows is
        less
        than the carrying amount of the asset. Impairment losses, if any, are measured
        as the excess of the carrying amount of the asset over its estimated fair
        value.
  (d)
              Cash
                  and Cash Equivalents
  The
        Company considers all highly liquid instruments with a maturity of three
        months
        or less at the time of issuance to be cash equivalents.
  (e)
              Foreign
                  Currency Transactions/Balances
  The
        Company's functional currency is the United States dollar. Occasional
        transactions occur in Canadian currency, and management has adopted SFAS
        No. 52,
        "Foreign Currency Translation". Monetary assets and liabilities denominated
        in
        foreign currencies are translated into United States dollars at rates of
        exchange in effect at the balance sheet date. Non-monetary assets, liabilities
        and items recorded in income arising from transactions denominated in foreign
        currencies are translated at rates of exchange in effect at the date of the
        transaction.
 
  North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 Notes
        to
        the Financial Statements
 April
        30,
        2005
  2.
                Summary
                    of Significant Accounting Policies (continued)
 (f)
              Revenue
                  Recognition
 
 The
        Company will receive, from the Grantor of the license, commissions of one-half
        of all the profit on all sales made through the Grantor's Web Site. The
        commission revenue will be recognized in the period the sales have occurred.
        The
        Company recognizes revenue in accordance with Securities and Exchange Commission
        Staff Accounting Bulletin No. 104, "Revenue Recognition in Financial
        Statements." Revenue is recognized only when the price is fixed or determinable,
        persuasive evidence of an arrangement exists, the service is performed, and
        collectibility is reasonably assured. The Company will report the commission
        revenue on a net basis as the Company is acting as an Agent for the Grantor
        and
        does not assume any risks or rewards of the ownership of the products. This
        policy is prospective in nature, as the Company has not yet generated any
        revenue.
 
 (g)
              Use
                  of Estimates and Assumptions
 
 The
        preparation of financial statements in conformity with generally accepted
        accounting principles in the United States of America 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 periods. Actual results could differ from those estimates.
 
 (h)
              Comprehensive
                  Loss
 
 SFAS
        No.
        130, "Reporting Comprehensive Income," establishes standards for the reporting
        and display of comprehensive loss and its components in the financial
        statements. As at April 30, 2005 and 2004, the Company has no items that
        represent comprehensive loss and, therefore, has not included a schedule
        of
        comprehensive loss in the financial statements.
 
 (i)
              Basic
                  and Diluted Net Income (Loss) per Share
 
 The
        Company computes net income (loss) per share in accordance with SFAS No.
        128,
        "Earnings per Share" (SFAS 128). SFAS 128 requires presentation of both basic
        and diluted earnings per share (EPS) on the face of the income statement.
        Basic
        EPS is computed by dividing net income (loss) available to common shareholders
        (numerator) by the weighted average number of common shares outstanding
        (denominator) during the period. Diluted EPS gives effect to all dilutive
        potential common shares outstanding during the period including stock options,
        using the treasury stock method, and convertible preferred stock, using the
        if-converted method. In computing Diluted EPS, the average stock price for
        the
        period is used in determining the number of shares assumed to be purchased
        from
        the exercise of stock options or warrants. Diluted EPS excludes all dilutive
        potential shares if their effect is anti dilutive. Loss per share information
        does not include the effect of any potential common shares, as their effect
        would be anti-dilutive.
  
  North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 Notes
        to
        the Financial Statements
 April
        30,
        2005
 2.
                Summary
                    of Significant Accounting Policies
                    (continued)
 (j)
              Financial
                  Instruments
 
 The
        fair
        value of cash, accounts payable and accrued liabilities were estimated to
        approximate their carrying values due to the immediate short-term maturity
        of
        these financial instruments. As the Company operates in Canada, virtually
        all of
        its assets and liabilities are giving rise to significant exposure to market
        risks from changes in foreign currency rates. The financial risk is the risk
        to
        the Company's operations that arise from fluctuations in foreign exchange
        rates
        and the degree of volatility of these rates. Currently, the Company does
        not use
        derivative instruments to reduce its exposure to foreign currency risk.
        Management does not believe the Company is exposed to significant credit
        or
        interest rate risks.
 
 (k)
              Concentration
                  of Credit Risk
 
 Financial
        instruments that potentially subject the Company to credit risk consist
        principally of cash. Cash is deposited with a high quality credit institution.
 
 (l)
              Recent
                  Accounting Pronouncements
 
 In
        December 2004, the Financial Accounting Standards Board (FASB) issued Statement
        of Financial Accounting Standard (SFAS) No. 123R, "Share Based Payment".
        SFAS
        123R is a revision of SFAS No. 123 "Accounting for Stock-Based Compensation",
        and supercedes APB Opinion No. 25, "Accounting for Stock Issued to Employees"
        and its related implementation guidance. SFAS 123R establishes standards
        for the
        accounting for transactions in which an entity exchanges its equity instruments
        for goods or services. It also addresses transactions in which an entity
        incurs
        liabilities in exchange for goods or services that are based on the fair
        value
        of the entity's equity instruments or that may be settled by the issuance
        of
        those equity instruments. SFAS 123R focuses primarily on accounting for
        transactions in which an entity obtains employee services in share-based
        payment
        transactions. SFAS 123R does not change the accounting guidance for share-based
        payment transactions with parties other than employees provided in SFAS 123
        as
        originally issued and Emerging Issues Task Force Issue No. 96-18 "Accounting
        for
        Equity Instruments That Are Issued to Other Than Employees for Acquiring,
        or in
        Conjunction with Selling, Goods or Services". SFAS 123R does not address
        the
        accounting for employee share ownership plans, which are subject to AICPA
        Statement of Position 93-6, "Employers' Accounting for Employee Stock Ownership
        Plans". SFAS 123R requires a public entity to measure the cost of employee
        services received in exchange for an award of equity instruments based on
        the
        grant-date fair value of the award (with limited exceptions). That cost will
        be
        recognized over the period during which an employee is required to provide
        service in exchange for the award-the requisite service period (usually the
        vesting period). SFAS 123R requires that the compensation cost relating to
        the
        share-based payment transactions be recognized in financial statements. That
        cost will be measured based on the fair value of the equity or liability
        instruments issued. The scope of SFAS 123R includes a wide range of share-based
        compensation arrangements including share options, restricted share plans,
        performance-based awards, share appreciation rights, and employee share purchase
        plans. Public entities (other than those filing as small business issuers)
        will
        be required to apply SFAS 123R as of the first interim or annual reporting
        period that begins after June 15, 2005. Public entities that file as small
        business issuers will be required to apply SFAS 123R in the first interim
        or
        annual reporting period that begins after December 15, 2005. For nonpublic
        entities, SFAS 123R must be applied as of the beginning of the first annual
        reporting period beginning after December 15, 2005.
  
  North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 Notes
        to
        the Financial Statements
 April
        30,
        2005
 2.
                Summary
                    of Significant Accounting Policies
                    (continued)
 (l)
              Recent
                  Accounting Pronouncements
                  (continued)
 
 The
        adoption of this standard is not expected to have a material effect on the
        Company's results of operations or financial position.
 
 In
        December 2004, FASB issued SFAS No. 153, "Exchange of Nonmonetary Assets-An
        Amendment of APB Opinion No. 29". The guidance in APB Opinion No. 29,
        "Accounting for Nonmonetary Transactions", is based on the principle that
        exchanges of nonmonetary assets should be measured based on the fair value
        of
        the assets exchanged. The guidance in that Opinion, however, included certain
        exceptions to that principle. SFAS No. 153 amends Opinion No. 29 to eliminate
        the exception for nonmonetary exchanges of similar productive assets and
        replaces it with a general exception for exchanges of nonmonetary assets
        that do
        not have commercial substance. A nonmonetary exchange has commercial substance
        if the future cash flows of the entity are expected to change significantly
        as a
        result of the exchange. The provisions of SFAS No. 153 are effective for
        nonmonetary asset exchanges occurring in fiscal periods beginning after June
        15,
        2005. Early application is permitted and companies must apply the standard
        prospectively. The adoption of this standard is not expected to have a material
        effect on the Company's results of operations or financial
        position.
 
 In
        March
        2005, the SEC staff issued Staff Accounting Bulletin No. 107 ("SAB No. 107")
        to
        give guidance on the implementation of SFAS 123R. The Company will consider
        SAB
        No. 107 during implementation of SFAS 123R.
 
 3.
              License
 
 The
        Company has a license to market vitamins, minerals, nutritional supplements
        and
        other health and fitness products through the Grantor's Web Site. The Company
        desires to market these products to medical practitioners, alternative health
        professionals, martial arts studios and instructors, sports and fitness
        trainers, other health and fitness practitioners, school and other fund raising
        programs and other similar types of customers in Minnesota. The license was
        acquired on April 13, 2000 and renewed on August 15, 2002 for a term of three
        years. The Company must pay an annual fee of $500 for maintenance of the
        Grantor's Web Site commencing with the year ended April 13, 2002. The
        annual fees for 2003 and 2004 were waived by the Grantor. The Grantor of
        the
        license retains 50% of any profits generated.
 
 The
        Company paid total consideration of $35,000 for the license with a note payable
        of $35,000. The $35,000 note payable to the former President of the Company
        was
        unsecured, non-interest bearing and was repayable by December 31, 2010. On
        July
        12, 2002, the former President of the Company forgave the note payable and
        released the Company from all obligations. Due to his relationship to the
        Company as the principal stockholder at the time of forgiveness, the forgiveness
        of this debt was treated as additional paid-in capital, in accordance with
        the
        provisions of Staff Accounting Bulletin Topic 5T.
 
 The
        License was written-off to operations due to the lack of historical cash
        flow
        and lack of a market to resell the license. However, it is the Company's
        intention to conduct a survey to determine its core target market from potential
        clients under its Vitamineralherb.com license, hire commissioned sales staff,
        establish an office, advertise, and begin making sales.
  
  North
        American Natural Gas Inc.
 (A
        Development Stage Company)
 Notes
        to
        the Financial Statements
 April
        30,
        2005
 
 4.
              Share
                  Subscriptions Refundable
 During
        fiscal 2003, the Company entered into agreements to purchase interests in
        two
        oil and gas exploration opportunities subject to raising a minimum of
        US$11,000,000 in a private offering. All funds received were kept in a lawyers
        escrow account until the minimum was received. A total of $1,600,000 was
        raised
        as at April 28, 2003. The Company was unsuccessful in its efforts to raise
        the
        minimum amount and all funds received pursuant to the offering were returned
        to
        the original subscribers from the escrow account during fiscal 2004 and all
        agreements were terminated.
 
 5.
              Common
                  Stock
 
 (a)
              During
                  fiscal 2003, pursuant to a private placement, the Company issued
                  312,500
                  common shares at $0.80 per share for total cash consideration of
                  $250,000.
 
 (b)
              The
                  Company has no stock option plan.
 
 6.
              Preferred
                  Stock
 
 On
        March
        13, 2003 the Company authorized 3,500,000 of the existing authorized preferred
        stock be designated as Class "A" Convertible Preferred Shares having a par
        value
        of $10.00 per share. None have been issued. When issued, holders will be
        entitled to receive a 6% cash dividend of $0.60 per share payable quarterly.
        These shares also carry conversion features of 1 preferred share for 8 common
        shares.
 
 7.
              Related
                  Party Transaction
 
 The
        President of the Company donated office rent of $1,200 for the year ended
        April
        30, 2005. This amount has been charged to operations.
 
 8.
              Income
                  Taxes
  The
        Company has adopted the provisions of SFAS No. 109 (SFAS 109), "Accounting
        for
        Income Taxes". Pursuant to SFAS 109, the Company is required to compute tax
        asset benefits for net operating loss carry forwards. Potential benefit of
        net
        operating losses has not been recognized in the financial statements because
        the
        Company cannot be assured that it is more likely than not that it will utilize
        the net operating losses carried forward in future years.
 
 The
        Company has accumulated net operating losses of $267,000, which expires starting
        in 2015.
 
 The
        components of the net deferred tax asset and the statutory tax rate, the
        effective tax rate and the elected amount of the valuation allowance are
        scheduled below:
 
 2005
                $
              
              2004
                $Net
                  Operating Losses
              
              
              29,000
              
              
              46,000Statutory
                  Tax Rate
              
              
              34
              %
              
              34
              %Effective
                  Tax Rate
              
              
              -
              
              
              -Deferred
                  Tax Asset
              
              
              9,861
              
              
              15,640Valuation
                  Allowance
              
              
              (9,861
              )
              
              (15,640
              )Net
                  Deferred Tax Asset
              
              
              -
              
              
              -