UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549  FORM 10-KSB  [X]     Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934  For the fiscal year ended December 31, 2007.  [  ]     Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934  For the transition period from ___________ to ___________  Commission File Number:001-32624  FIELDPOINT PETROLEUM CORPORATION(Name of Small Business Issuer in Its Charter)  Colorado
(State or Other Jurisdiction of
Incorporation or Organization)84-0811034
(I.R.S. Employer
Identification No.)  1703 Edelweiss DriveCedar Park, Texas  78613(Address of Principal Executive Offices)   (Zip Code)  (512) 250-8692(Issuer's Telephone Number, Including Area Code)  Securities registered under Section 12(b) of the Exchange Act:
(None)  Securities registered under Section 12(g) of the Exchange Act:  Common Stock, $.01 Par ValueTitle of Class  Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act.  [        ]  Note  Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Exchange Act from their obligations under those Sections.  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  Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B 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. [    ]    Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  NoX  State issuer's revenues for its most recent fiscal year.  $4,409,524.  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).  The aggregate market value of the voting stock held by non-affiliates of the Registrant at March 24, 2008, was $5,727,201.  As of March 31, 2008, 8,910,175 shares of the Registrant's common stock par value $.01 per share, were outstanding.  Documents Incorporated by Reference:  If the following documents are incorporated by reference, briefly describe them and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc) into which the document is incorporated:  (1) any annual report to security holders; (2) any proxy or information statement; and (3) any prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933 (Securities Act).  The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1990).  (a)Exhibits3.1Articles of Incorporation (incorporated by reference to Amendment No. 1 to Form S-2 dated August 1, 1980.)3.2(b)Articles of Amendment of Articles of Incorporation, dated December 31, 1997 (incorporated by reference to the Company's 10KSB for the year ended December 31, 1997.)3.3Bylaws (incorporated by reference to Amendment No. 1 to Form S-2 dated August 1, 1980.)4.1Plan of Exchange (incorporated by reference to the Company's definitive proxy statement dated December 8, 1997).4.2Indenture (Term Loan) dated June 21, 1999 by and among the Company and Union Planters Bank4.3Indenture (Term Loan) dated August 18, 1999 by and among the Company and Union Planters Bank10.1Consulting Agreement dated May 9, 2000 between FieldPoint Petroleum Corp. and Parrish Brian & Co. (incorporated by reference to the Company's 10QSB/A for the quarter ended September 30, 2000)10.2Executive Employment Agreement, dated March 28, 2001, by and among FieldPoint Petroleum Corp. and Ray D. Reaves (incorporated by reference to the Company's 10KSB for the year ended December 31, 2000.)10.3Credit Agreement (Revolving Credit Note) dated December 14, 2000 by and among FieldPoint Petroleum Corp. and Union Planters Bank (incorporated by reference to the Company's 10KSB for the year ended December 31, 2000.)    10.4Audit Committee Charter adopted by the Company on March 28, 2001(incorporated by reference to the Company's 10KSB for the year ended December 31, 2000.)10.5Consulting Agreement dated November 13, 2001 between FieldPoint Petroleum Corp. and TRG Group LLC. (incorporated by reference to the Company's 10QSB for the quarter ended September 30, 2001)10.7Loan and Security Agreement with CitiBank, N.A., dated October 18, 2006 (incorporated by reference from the Companys current report on Form 8k dated October 18, 2006 as filed with the Commission on October 20, 2006.)10.6Lease Assignment from PXP Gulf Coast, Inc., dated March 11, 2004, incorporated by reference from the Company's Current Report on Form 8-K dated March 11, 2004, as filed with the Commission on March 26, 2004.14.Code of Ethics (incorporated by reference to the Companys Annual Report on Form 10-KSB for the year ended December 31, 2003 as filed with the Commission on April 14, 2004.)  The Registrant hereby incorporates herein by reference the following documents.  Transitional Small Business Disclosure Format (Check one):  Yes [     ]; No [ X ]      PART I  SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS  Certain statements contained in this Form 10-KSB constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act and Section 27A of the Securities Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  All statements, other than statements of historical facts, included in this Form 10-KSB that address activities, events or developments that FieldPoint Petroleum Corp. and its subsidiaries (collectively, the "Company") expects, projects, believes or anticipates will or may occur in the future, including such matters as oil and natural gas reserves, future drilling and operations, future production of oil and natural gas, future net cash flows, future capital expenditures and other such matters, are forward-looking statements.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  Such factors include, among others, the following:  the volatility of oil and natural gas prices, the Company's drilling and acquisition results, the Company's ability to replace reserves, the availability of capital resources, the reliance upon estimates of proved reserves, operating hazards and uninsured risks, competition, government regulation, the ability of the Company to implement its business strategy and other factors referenced in this Form 10-KSB.  ITEM 1-BUSINESS  General  FieldPoint Petroleum Corporation, a Colorado corporation (the "Company"), was formed on March 11, 1980, to acquire and enhance mature oil and natural gas field production in the mid-continent and the Rocky Mountain regions. Since 1980, the Company had engaged in oil and natural gas operations and, in 1986, divested all oil and natural gas assets and operations. From December 1986, until its reverse acquisition on December 31, 1997, the Company had not engaged in oil and natural gas operations.  Reverse Acquisition - On December 22, 1997, the Company entered into an Agreement with Bass Petroleum, Inc., a Texas corporation ("BPI"), pursuant to which, on December 31, 1997, the Company acquired from the shareholders of BPI an aggregate of 8,655,625 shares of capital stock of BPI, in exchange for the issuance of 4,000,000 unregistered shares of the Company's common stock.  The transaction was treated, for accounting purposes, as an acquisition of FieldPoint Petroleum Corporation by Bass Petroleum, Inc. On December 31, 1997, the Company changed its name from Energy Production Company to FieldPoint Petroleum Corporation.  Business Strategy  The Company's business strategy is to continue to expand its reserve base and increase production and cash flow through the acquisition of producing oil and natural gas properties.  Such acquisitions will be based on an analysis of the properties' current cash flow and the Company's ability to profit  1    from the acquisition.  The Company's ideal acquisition will include not only oil and natural gas production, but also leasehold and other working interests in exploration areas.  The Company will also seek to identify promising areas for the exploration of oil and natural gas through the use of outside consultants and the expertise of the Company.  This identification will include collecting and analyzing geological and geophysical data for exploration areas.  Once promising properties are identified, the Company will attempt to acquire the properties either for drilling oil and natural gas wells, using independent contractors for drilling operations, or for sale to third parties.  The Company recognizes that the ability to implement its business strategies is largely dependent on the ability to raise additional debt or equity capital to fund future acquisition, exploration, drilling and development activities.  The Company's capital resources are discussed more thoroughly in Part II, Item 6, in Management's Discussion and Analysis.  Operations  As of December 31, 2007, the Company had varying ownership interest in 359 gross productive wells (96.31 net) located in 5 states.  The Company operates 61 of the 359 wells; the other wells are operated by independent operators under contracts that are standard in the industry.  It is a primary objective of the Company to operate some of the oil and natural gas properties in which it has an economic interest, and the Company will also partner with larger oil and natural gas companies to operate certain oil and natural gas properties in which the Company has an economic interest.  The Company believes, with the responsibility and authority as operator, it is in a better position to control cost, safety, and timeliness of work as well as other critical factors affecting the economics of a well.  Market for Oil and Natural Gas  The demand for oil and natural gas is dependent upon a number of factors, including the availability of other domestic production, crude oil imports, the proximity and size of oil and natural gas pipelines in general, other transportation facilities, the marketing of competitive fuels, and general fluctuations in the supply and demand for oil and natural gas.  The Company intends to sell all of its production to traditional industry purchasers, such as pipeline and crude oil companies, who have facilities to transport the oil and natural gas from the well site.  Competition  The oil and natural gas industry is highly competitive in all aspects.  The Company competes with major oil companies, numerous independent oil and natural gas producers, individual proprietors, and investment programs.  Many of these competitors possess financial and personnel resources substantially in excess of those which are available to the Company and may, therefore, be able to pay greater amounts for desirable leases and define, evaluate, bid for and purchase a greater number of potential producing prospects that the Company's own resources permit.  The Company's ability to generate resources will depend not only on its ability to develop existing properties but also on its ability to identify and acquire proven and unproven acreage and prospects for further exploration.   2    Environmental Matters and Government Regulations  The Company's operations are subject to numerous federal, state and local laws and regulations controlling the discharge of materials into the environment or otherwise relating to the protection of the environment.  Such matters have not had a material effect on operations of the Company to date, but the Company cannot predict whether such matters will have any material effect on its capital expenditures, earnings or competitive position in the future.  The production and sale of crude oil and natural gas are currently subject to extensive regulations of both federal and state authorities.  At the federal level, there are price regulations, windfall profits tax, and income tax laws.  At the state level, there are severance taxes, proration of production, spacing of wells, prevention and clean-up of pollution and permits to drill and produce oil and natural gas.  Although compliance with their laws and regulations has not had a material adverse effect on the Company's operations, the Company cannot predict whether its future operations will be adversely effected thereby.  Operational Hazards and Insurance  The Company's operations are subject to the usual hazards incident to the drilling and production of oil and natural gas, such as blowouts, cratering, explosions, uncontrollable flows of oil, natural gas or well fluids, fires, pollution, releases of toxic gas and other environmental hazards and risks.  These hazards can cause personal injury and loss of life, severe damage to and destruction of property and equipment, pollution or environmental damage and suspension of operations.  The Company maintains insurance of various types to cover its operations.  The Company's insurance does not cover every potential risk associated with the drilling and production of oil and natural gas.  In particular, coverage is not obtainable for certain types of environmental hazards.  The occurrence of a significant adverse event, the risks of which are not fully covered by insurance, could have a material adverse effect on the Company's financial condition and results of operations.  Moreover, no assurance can be given that the Company will be able to maintain adequate insurance in the future at rates it considers reasonable.  Administration  Office Facilities- The office space for the Company's executive offices at 1703 Edelweiss Drive, Cedar Park, Texas 78613, is currently provided by the President at a cost of $2,500 per month as of December 31, 2007.  Employees- As of March 31, 2008, the Company had 4 employees, and the Company considers its relationship with its employees satisfactory.   ITEM 2-PROPERTIES  Principal Oil and Natural Gas Interest  Apache Field, Caddo County Oklahomais a waterflood project producing from the Viola/Bromide formation. The Apache Bromide Unit is located approximately 5 miles west of the town of Apache  3    and 25 miles north of Lawton, Oklahoma. The Company has a 25.23% working interest in the unit which consists of 11 producing oil wells and 9 water injection wells.  North Bilbrey Field, Lea County New Mexicois a producing natural gas field located outside of Hobbs, New Mexico. The company owns a 50% working interest in the North Bilbrey #7 federal well producing out of the Atoka formation at approximately 13,000 feet.  Longwood Field, Caddo Parish Louisianais a producing natural gas field located north of Greenwood, Louisiana. The Company owns a 12.22% working interest in two natural gas wells producing out of the Cotton Valley formation at a depth of approximately 7,800 feet.  Lusk Field, Lea County New Mexicois a producing oil and natural gas field located outside of Hobbs, New Mexico. The company owns an 87.5%-100% working interest in two oil and natural gas wells producing out of the Bonesprings and Yates formations at depth ranging from approximately 3,400 feet to approximately 10,000 feet and a 14.06% working interest in one natural gas well producing out of the Morrow formation. The Company also owns an 87.5% working interest in one water disposal well.  Loving North Morrow Field, Eddy County New Mexicois a producing natural gas field located 2 miles west of Loving, New Mexico and 12 miles south east of Carlsbad, New Mexico. The company owns a 4.3% - 12% working interest in three natural gas wells producing out of the Morrow formation from a depth of approximately 12,300 feet to 12,450 feet.  Chickasha Field, Grady County Oklahomais a waterflood project producing from the Medrano Sand. The Rush Springs Medrano Unit is located approximately sixty-five miles southwest of Oklahoma City, Oklahoma. The Company has a 20.64% working interest in the unit which consists of 21 producing oil and natural gas wells and 11 water injection wells.  Hutt Wilcox Field, McMullen and Atascosa County Texasis an oil and natural gas field located approximately 60 miles south of San Antonio, Texas producing from the Wilcox sand. The Company has a working interest in 14 oil wells.  West Allen Field, Pontotoc County Oklahomais a producing oil and natural gas field located approximately 100 miles south of Oklahoma City, Oklahoma. The Company has a working interest in 52 leases or a total of 224 wells, the leases have multiple wellbores and the Company has plans to participate in the future recompletion of behind pipe zones.  Giddings Field, Fayette County Texasis in the Austin Chalk field located in various counties surrounding the city of Giddings, Texas. In February 1998, the company acquired a 97% working interest in the Shade lease. The lease currently has 3 producing oil and natural gas wells with a daily production rate of approximately 120 Mcfe net to the Company. Oil and natural gas are produced from the Austin chalk formation.  The Company will evaluate whether additional reserves can be developed by use of horizontal well technology.  Big Muddy Field, Converse County Wyoming is a producing oilfield located approximately thirty miles south of Casper, Wyoming.  FieldPoint Petroleum owns a 100% working interest in the Elkhorn and J.C. Kinney lease which consists of 3 oil wells producing out of the Wallcreek and Dakota formations at depths ranging from approximately 3,200 feet to approximately 4,000 feet.   4    Whisler Field, Campbell County Wyomingis a producing oilfield located approximately fifteen miles north east of Gillette, Wyoming. FieldPoint Petroleum owns a 20% working interest in the Whisler Unit which consists of two wells producing out of the Minnelusa formation at depth of approximately 8,340 feet to 8,400 feet.  Serbin Field, Lee and Bastrop Counties Texasis a oil and natural gas field located approximately 50 miles east of Austin and 100 miles west of Houston.  The Company has a working interest in 72 producing oil and natural gas wells.  Oil and natural gas are produced from the Taylor Sand at depths ranging from approximately 5,300 feet to approximately 5,600 feet; it is a 46-gravity oil sand.   Production  The table below sets forth oil and natural gas production from the Company's net interest in producing properties for each of its last two fiscal years.  Oil (bbl)Gas (mcf)Production by State2007200620072006Louisiana86-15,65920,089New Mexico4,9007,57170,43538,174Oklahoma27,73824,81423,28126,311Texas8,94010,95430,01738,361Wyoming5,8965,740--TOTAL47,56049,079139,392122,935   The Company's oil and natural gas production is sold on the spot market and the Company does not have any production that is subject to firm commitment contracts.  During the year ended December 31, 2007, purchases by each of four customers, Dorado Oil Company, Pontotoc Production, Inc., Encore Acquisition Co., and ConocoPhillips represented more than 10% of total Company revenues.   None of these customers, or any other customers of the Company, has a firm sales agreement with the Company.  The Company believes that it would be able to locate alternate customers in the event of the loss of one or all of these customers.   5    Productive Wells  The table below sets forth certain information regarding the Company's ownership, as of December 31, 2007, of productive wells in the areas indicated.  Productive WellsOilGasStateGross(1)Net(2)Gross(1)Net(2)Louisiana--2.24New Mexico21.65.79Oklahoma21951.13374.59Texas8231.1573.8Wyoming53.01--Total30886.89519.42  1 A gross well or acre is a well or acre in which a working interest is owned.  The number of gross wells is the total number of wells in which a working interest is owned.  The number of gross acres is the total number of acres in which a working interest is owned. 2 A net well or acre is deemed to exist when the sum of fractional ownership working interests in gross wells or acres equals one.  The number of net wells or acres is the sum of the fractional working interests owned in gross wells or acres expressed as whole numbers and fractions thereof.   Drilling Activity  The tables below set forth certain information regarding the number of productive and dry exploratory and development wells drilled for the fiscal year ended December 31, 2007.  The Company drilled one successful well in fiscal year 2007 in the Cronos Fee #1 well in New Mexico.  Exploratory WellsDevelopment WellsStateProductiveDryProductiveDryLouisiana--------New Mexico----1--Oklahoma--------Texas--------Wyoming--------Total----1--   Reserves  Estimated Proved Reserves/Developed and Undeveloped Reserves:The following tables set forth the estimated proved developed and proved undeveloped oil and gas reserves of FieldPoint for the years ended December 31, 2007 and 2006. See Note 12 to the Consolidated Financial Statements and the following discussion.    6    Estimated Proved Reserves Proved ReservesOil (Bbls)Gas (Mcf)Estimated quantity, January 1, 2006935,3092,103,689Revisions of previous estimates(140,369)(285,768)Extensions and discoveries8333,237Purchase of minerals in place-339,683Production(49,079)(122,935)Estimated quantity, December 31, 2006746,6942,037,906Revisions of previous estimates55,398700,820Extensions and discoveries-143,927Purchase of minerals in place130,718-Production(47,561)(139,392)Estimated quantity, December 31, 2007885,2492,743,261  Proved Developed and Undeveloped ReservesDevelopedUndevelopedTotalOil (Bbls)December 31, 2007769,319115,930885,249December 31, 2006637,652109,042746,694Gas (Mcf)December 31, 20071,785,240958,0212,743,261December 31, 20061,761,909275,9972,037,906  Our proved oil and natural gas reserves as of December 31, 2007 and December 31, 2006 have been estimated by Fletcher Lewis Engineering, Inc., and Aluko & Associates, Inc., consulting petroleum engineers.  As defined in the Securities and Exchange Commission Rules, proved reserves are the estimated quantities of crude oil, natural gas and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions, i.e., prices and costs as of the date the estimate is made.  Prices include considerations of changes in existing prices provided only by contractual arrangements but not on escalations based on future conditions.  Reservoirs are considered proved if economic productability is supported by either actual production or conclusive formation tests.  Reserves which can be produced economically through application of improved recovery techniques, such as fluid injections, are included in the proved classification when successful testing by a pilot project, or the operations of an installed program in the reservoir, provide support for the engineering analysis on which the project or program was based.  Due to the  7    inherent uncertainties and the limited nature of reservoir data, such estimates are subject to change as additional information becomes available.  The reserves actually recovered and the timing of production of these reserves may be substantially different from the original estimate.  Revisions result primarily from new information obtained from development drilling and production history and from changes in economic factors. For information concerning the standardized measure of discounted future net cash flows, estimated future net cash flows and present values of such cash flows attributable to our proved oil and gas reserves as well as other reserve information, see Note 13 to the Consolidated Financial Statements. Oil and Gas Reserves Reported to Other Agencies:We did not file any estimates of total proved net oil or gas reserves with, or include such information in reports to, any federal authority or agency during the fiscal year ended December 31, 2007, or subsequently thereafter. Title Examinations: Oil and Gas:As is customary in the oil and gas industry, we perform only a perfunctory title examination at the time of acquisition of undeveloped properties. Prior to the commencement of drilling, in most cases, and in any event where we are the Operator, a thorough title examination is conducted and significant defects remedied before proceeding with operations. We believe that the title to our properties is generally acceptable to a reasonably prudent operator in the oil and gas industry. The properties we own are subject to royalty, overriding royalty and other interests customary in the industry, liens incidental to operating agreements, current taxes and other burdens, minor encumbrances, easements and restrictions. We do not believe that any of these burdens materially detract fro m the value of the properties or will materially interfere with our business. We have purchased producing properties on which no updated title opinion was prepared.  In some but not all cases, we have retained third party certified petroleum landmen to review title. Acreage The following tables set forth the gross and net acres of developed and undeveloped oil and natural gas leases in which the Company had working interest and royalty interest as of December 31, 2007.  The category of "Undeveloped Acreage" in the table includes leasehold interest that already may have been classified as containing proved undeveloped reserves.  DevelopedUndevelopedStateGross (1)Net (2)Gross (1)Net (2)Louisiana32078--New Mexico1,600754800102Oklahoma8,8261,30020019Texas2,1205471,3601,000Wyoming5602682,3062,360Total13,4262,9474,6663,481  1 A gross well or acre is a well or acre in which a working interest is owned.  The number of gross wells is the total number of wells in which a working interest is owned.  The number of gross acres is the total number of acres in which a working interest is owned. 2 A net well or acre is deemed to exist when the sum of fractional ownership working interests in gross wells or acres equals one.  The number of net wells or acres is the sum of the fractional working interests owned in gross wells or acres expressed as whole numbers and fractions thereof.  ITEM 3-LEGAL PROCEEDINGS  8     None.  ITEM 4-SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS  None.  9     PART II  ITEM 5-MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS  Since September 20, 2005 the Company's Common Stock has been traded and listed on the American Stock Exchange under the symbol "FPP."  Prior to September 20, 2005, the Companys common stock was listed on the OTC bulletin board under the symbol FPPC.  The following quotations, where quotes were available, reflect inter-dealer prices, without retail mark-up, markdown or commission and may not necessarily represent actual transactions.   FISCAL 2006CLOSING BIDHIGHLOWFirst Quarter9.065.00Second Quarter7.674.50Third Quarter5.642.69Fourth Quarter2.872.01FISCAL 2007HIGHLOWFirst Quarter2.201.67Second Quarter2.191.78Third Quarter1.791.45Fourth Quarter1.201.09  At March 31, 2008, the approximate number of shareholders of record was 3,050.  The Company has not paid any dividends on its Common Stock and does not expect to do so in the foreseeable future.   10    Recent Sales of Unregistered Securities   Small Business Issuer Purchases of Equity Securities Period(a)
Total number of shares (or units) purchased(b)
Average price paid per share (or unit)(c)
Total number of shares (or units) purchased as part of publicly announced plans or programs(d)
Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programsAugust 22, 2007 to September 30, 200765,000$1.6565,000$117,656October  1, 2007 to December 1, 200770,000$1.5270,000$106,150Total135,000135,000223,806  In its Current Report on Form 8-K dated August 21, 2007, the Company announced its stock buy-back program. Under the program, the Company purchased shares of its common stock for an aggregate amount not exceeding $225,000. Stock purchases were made from time to time in the open market or in privately-negotiated transactions, if and when management determines to effect purchases.  All stock repurchases were subject to the requirements of Rule 10b-18 under the Exchange Act.      11       EQUITY COMPENSATION PLAN INFORMATION  Number of
securities to be
issued upon
exercise of
outstanding
options, warrants
and rights
(a)Weighted
average
exercise price
of outstanding
options,
warrants and
rights
(b)Number of
securities
remaining
available for
future
issuances
under equity
compensation
plans
(excluding
securities
reflected in
column (a))
(c)Equity compensation plans approved by
security holders---Equity compensation plans not approved
By security holders---Total---   ITEM 6     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION  The following discussion should be read in conjunction with the Company's Financial Statements, and respective notes thereto, included elsewhere herein.  The information below should not be construed to imply that the results discussed herein will necessarily continue into the future or that any conclusion reached herein will necessarily be indicative of actual operating results in the future.  Such discussion represents only the best present assessment of the management of FieldPoint Petroleum Corporation.  Overview  FieldPoint Petroleum Corporation derives its revenues from its operating activities including sales of oil and natural gas and operating oil and natural gas properties.  The Company's capital for investment in producing oil and natural gas properties has been provided by cash flow from operating activities and from bank financing.  The Company categorizes its operating expenses into the categories of production expenses and other expenses.   12    Results of Operation  Comparison of Year Ended December 31, 2007 to Year Ended December 31, 2006  Revenues increased 9% or $355,932 to $4,409,524 for the year ended December 31, 2007, from the comparable 2006 period.  Oil production volumes decreased by 3% at the same time the average price per barrel increased 14% during 2007 to $71.26 from the comparable 2006 period average price of $62.57 per barrel.  Also in 2007, natural gas production volumes increased by 13% while the average price per Mcf was $6.18, a decrease of 6% from the 2006 comparable period.  The decreases in production volumes were primarily due to declines in the Encore operated Rush Springs Unit in Grady County, Oklahoma the Pontotoc County, Oklahoma properties and mature fields in Texas offset by the Lea County and Eddy County, New Mexico Field production and the Apache Bromide Unit.  Year Ended December 31,20072006Oil Production47,56149,079average Sales Price Per Bbl ($/Bbl)$       71.26$    62.57Gas Production139,392122,935average Sales Price Per Mcf ($/Mcf)$        6.18$      6.58Lifting cost/BOE$      23.36$    20.22  Production expenses increased 18% to $1,653,467 for the year ended December 31, 2007, from the comparable 2006 period. The increase was due to cost associated with mature field production, heightened by workover expense and remedial repairs incurred in 2007 as compared to 2006.  The Company incurred no exploration expense for 2007 as compared to $5,467 during the 2006 period.  Depletion and depreciation expense increased 79% or $383,069 to $870,069 for the year ended December 31, 2007 from the comparable 2006 period. The increase in depletion and depreciation was due to acquisitions and net production volume increase and increased capitalized costs, which were slightly offset by increased reserves on existing properties. The increase in lifting cost of $23.36 in 2007 compared to $20.22 in 2006 was primarily due to additional workovers and remedial repairs. The Company incurred impairment expense of $276,635 in 2007 as a result of the Hutt Field located in Texas and the write off of the Palo-Duro Basin unproved acreage since the Company plans no development drilling.  General and administrative overhead increased 35% or $191,480 to $739,715 for the 2007 period verses the comparable 2006 period. The increase in general and administrative expense was primarily due to increases in professional services for Sarbanes-Oxley compliance and by an increase in salary expense.  Other expenses, net, for the year ended December 31, 2007, were $36,292 compared to other income, net, of $173,136 for 2006.  This decrease was primarily due to interest expense associated with our line of credit and a decrease in unrealized gains on investments in 2007.  The Company's net income decreased by $623,687 to $558,078 for the year ended December 31, 2007, from the comparable 2006 period.  The decrease in net income was primarily due to the increase in total cost and expenses as previously discussed.  13     Liquidity and Capital Resources  Cash flow provided by operating activities was $2,466,904 for the year ended December 31, 2007, compared to $1,592,471 for the year ended December 31, 2006.  The increase in cash flow from operating activities was primarily due to the increase in depletion and depreciation, and impairment of oil and gas properties, combined with an increase in accounts payable.  Cash flow used in investing activities was $3,998,418 for the year ended December 31, 2007, compared to $2,728,530 in cash flow used in investing activities for December 31, 2006.  This increase was primarily due to acquisitions of oil and natural gas properties in 2007.  Cash flow provided by financing activities was $2,412,369 for the year ended December 31, 2007, compared to $1,532,800 in cash flow provided by financing activities for the same period in 2006.  This was primarily due to the increase in advances of long-term debt, net of repayment offset by the purchase of treasury shares.  During the year ended December 31, 2007, the Company repurchased, in market transactions, an aggregate of 135,000 shares of its common stock for a total purchase price of $223,806.  The repurchases were undertaken pursuant to a stock buy-back program approved by the Board of Directors.  Capital Requirements  Management believes the Company will be able to meet its current operating needs through internally generated cash from operations and borrowings under credit facilities. Management believes that oil and natural gas property investing activities in 2008 can be financed through cash on hand, cash from operating activities, and bank borrowing.  The Company anticipates continued investments in proven oil and natural gas properties in 2008. If bank credit is not available, the Company may not be able to continue to invest in strategic oil and natural gas properties.  The Company cannot predict how oil and natural gas prices will fluctuate during 2008 and what effect they will ultimately have on the Company, but Management believes that the Company will be able to generate sufficient cash from operations to service its bank debt and provide for maintaining current production of its oil and natural gas properties. The Company had no significant commitments for capital expenditures at December 31, 2007. The timing of most capital expenditures for new operations is relatively discretionary. Therefore, the Company can plan expenditures to coincide with available funds in order to minimize business risks.  14     Contractual Obligations and Commitments  We have contractual obligations and commitments that affect our consolidated results of operations, financial condition and liquidity. The following table is a summary of our significant cash contractual obligations:  Obligation Due in PeriodCash Contractual Obligations20072008200920102011ThereafterTotal(in thousands)Credit facility (secured)$$$$3,489$$$  3,489Interest on credit facility235235235196901Facilities and office leasesPurchase obligationsTotal$235$235$235$3,685$$$4,390  15


Quantitative and Qualitative Disclosures About Market Risk  We periodically enter into certain commodity price risk management transactions to manage our exposure to oil and natural gas price volatility. These transactions may take the form of futures contracts, swaps or options. All data relating to our derivative positions is presented in accordance with requirements of SFAS No. 133, which we adopted on January 1, 2001. Accordingly, unrealized gains and losses related to the change in fair market value of derivative contracts that qualify and are designated as cash flow hedges are recorded as other comprehensive income or loss and such amounts are reclassified to oil and natural gas sales revenues as the associated production occurs. Derivative contracts that do not qualify for hedge accounting treatment are recorded as derivative assets and liabilities at market value in the consolidated balance sheet, and the associated unrealized gains and losses are recorded as current expense or income in the consolidated statement of operations. While such derivative contracts do not qualify for hedge accounting, management believes these contracts can be utilized as an effective component of commodity price risk management activities. At December 31, 2007 and December 31, 2006, there were no open positions. We did not have any derivative transactions during 2007 or 2006.  Critical Accounting Policies and Estimates  Our accounting policies are described in Note 1 of Notes to Consolidated Financial Statements in Item 7. We prepare our Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"), which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. We consider the following policies to be most critical in understanding the judgments that are involved in preparing our financial statements and the uncertainties that could impact our results of operations, financial condition and cash flows.  SuccessfulEffortsMethodofAccounting  We account for our exploration and development activities utilizing the successful efforts method of accounting. Under this method, costs of productive exploratory wells, development dry holes and productive wells and undeveloped leases are capitalized. Oil and natural gas lease acquisition costs are also capitalized. Exploration costs, including personnel costs, certain geological and geophysical expenses and delay rentals for oil and natural gas leases, are charged to expense as incurred. Exploratory drilling costs are initially capitalized, but charged to expense if and when the well is determined not to have found reserves in commercial quantities. The sale of a partial interest in a proved property is accounted for as a cost recovery and no gain or loss is recognized as long as this treatment does not significantly affect the unit-of-production amortization rate. A gain or loss is recognized for all other sales of producing properties.  The application of the successful efforts method of accounting requires managerial judgment to determine the proper classification of wells designated as developmental or exploratory which will ultimately determine the proper accounting treatment of the costs incurred. The results from a drilling operation can take considerable time to analyze and the determination that commercial reserves have been discovered requires both judgment and industry experience. Wells may be completed that are assumed to be productive and actually deliver oil and natural gas in quantities insufficient to be economic, which may result in the abandonment of the wells at a later date.  The evaluation of oil and natural gas leasehold acquisition costs requires managerial judgment to estimate the fair value of these costs with reference to drilling activity in a given area.


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The successful efforts method of accounting can have a significant impact on the operational results reported when we enter a new exploratory area in hopes of finding an oil and natural gas field that will be the focus of future developmental drilling activity. The initial exploratory wells may be unsuccessful and will be expensed. Seismic costs can be substantial which will result in additional exploration expenses when incurred.  Reserve Estimates  Estimates of oil and natural gas reserves, by necessity, are projections based on geologic and engineering data, and there are uncertainties inherent in the interpretation of such data as well as the projection of future rates of production and the timing of development expenditures. Reserve engineering is a subjective process of estimating underground accumulations of oil and natural gas that are difficult to measure. The accuracy of any reserve estimate is a function of the quality of available data, engineering and geological interpretation and judgment. Estimates of economically recoverable oil and natural gas reserves and future net cash flows necessarily depend upon a number of variable factors and assumptions, such as historical production from the area compared with production from other producing areas, the assumed effects of regulations by governmental agencies and assumptions governing future oil and natural gas prices, future operating costs, severance taxes, development costs and workover costs, all of which may in fact vary considerably from actual results. The future drilling costs associated with reserves assigned to proved undeveloped locations may ultimately increase to an extent that these reserves may be later determined to be uneconomic. For these reasons, estimates of the economically recoverable quantities of oil and natural gas attributable to any particular group of properties, classifications of such reserves based on risk of recovery, and estimates of the future net cash flows expected therefrom may vary substantially. Any significant variance in the assumptions could materially affect the estimated quantity and value of the reserves, which could affect the carrying value of our oil and natural gas properties and/or the rate of depletion of the oil and natural gas properties.  Actual production, revenues and expenditures with respect to our reserves will likely vary from estimates, and such variances may be material.  Impairment of Oil and Natural Gas Properties  We review our oil and natural gas properties for impairment whenever events and circumstances indicate a decline in the recoverability of their carrying value. We estimate the expected future cash flows of our oil and natural gas properties and compare such future cash flows to the carrying amount of our oil and natural gas properties to determine if the carrying amount is recoverable.  If the carrying amount exceeds the estimated undiscounted future cash flows, we will adjust the carrying amount of the oil and natural gas properties to their fair value. The factors used to determine fair value include, but are not limited to, estimates of proved reserves, commodity pricing, future production estimates, anticipated capital expenditures, and a discount rate commensurate with the risk associated with realizing the expected cash flows projected. There was $276,635 in impairments of developed oil and natural gas properties during 2007 and there were no impairments in 2006.


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Reporting Requirements  Because our common stock is publicly traded, we are subject to certain rules and regulations of federal, state and financial market exchange entities charges with the protection of investors and the oversight of companies whose securities are publicly traded. These entities, including the SEC and the American Stock Exchange, have recently issued new requirements and regulations and are currently developing additional regulations and requirements in response to recent laws, enacted by Congress, most notably the Sarbanes-Oxley Act 2002.  Our compliance with current and proposed rules, such as Section 404 of the Sarbanes-Oxley Act of 2002, is likely to require the commitment of significant managerial resources. We are currently reviewing our internal control systems, processes and procedures to ensure compliance with the requirements of Section 404.  New Accounting Pronouncements  In September 2006, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS No. 157).  SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurement. SFAS No. 157 also emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and sets out a fair value hierarchy with the highest priority being quoted prices in active markets.  Under SFAS No. 157, fair value measurements are disclosed by level within that hierarchy.  This Statement is effective for fiscal years beginning after November 15, 2007.  In February 2008, the FASB issued FASB Staff Position No. FAS 157-2, which defers the effective date of SFAS 157 for nonfinancial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually) to fiscal years beginning after November 15, 2008 and interim periods within those years.  We do not expect the adoption of SFAS 157 will have a significant impact on our financial statements.  In February 2007, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (SFAS No. 159).  SFAS No.159 permits companies to elect to follow fair value accounting for certain financial assets and liabilities in an effort to mitigate volatility in earnings without having to apply complex hedge accounting provisions.  The standard also establishes presentation and disclosure requirements designed to facilitate comparison between entities that choose different measurement attributes for similar types of assets and liabilities.  SFAS No. 159 is effective for fiscal years beginning after November 15, 2007.   SFAS No. 159 is not expected to have a material impact on the Companys financial position, results of operations or cash flows.  In July 2006, the Financial Accounting Standards Board (FASB) issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes  an interpretation of FASB Statement 109(FIN 48).  FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes.  FIN 48 prescribes a comprehensive model for recognizing, measuring, presenting and disclosing in the financial statements tax positions taken or expected to be taken on a tax return.  FIN 48 is effective for fiscal years beginning after December 15, 2007.  The cumulative effect of applying the provisions of FIN 48, if any, will be reported as an adjustment to the opening balance of retained earnings for the fiscal year of adoption.  The Company adopted FIN 48 on January 1, 2007 and its adoption did not have a material impact on its consolidated financial position, results of operations or cash flows.


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In December 2007, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 141R, Business Combinations, and Statement of Financial Accounting Standards No. 160, Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51.  These new standards significantly change the accounting for and reporting of business combination transactions and noncontrolling interests (previously referred to as minority interests) in consolidated financial statements.  Both standards are effective for fiscal years beginning on or after December 15, 2008, with early adoption prohibited. These Statements are effective for the Company beginning on January 1, 2009.  The Company is currently evaluating the provisions of FAS 141(R) and FAS 160.  In March 2008, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 161, Disclosures About Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133.  This new standard enhances the disclosure requirements related to derivative instruments and hedging activities required by FASB Statement No. 133.  This standard is effective for fiscal years and interim periods beginning after November 15, 2008, with early adoption encouraged.  We adopted the required provisions of SFAS 161 on January 1, 2008 and the adoption did not have a significant impact on our financial statements.


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ITEM 7-FINANCIAL STATEMENTS  The information required is included in this report as set forth in the "Index to Financial Statements."


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Index to Financial Statements    PageIndependent Auditor's ReportF-1Consolidated Balance SheetsF-2Consolidated Statements of OperationsF-3Consolidated Statements of Changes in Stockholders' EquityF-4Consolidated Statements of Cash FlowsF-5Notes to Consolidated Financial StatementsF-6 - F-17Supplemental Oil and Natural Gas Information (Unaudited)F-17 - F-21


21


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM    Board of Directors and Stockholders FieldPoint Petroleum Corporation and Subsidiaries Austin, Texas  We have audited the consolidated balance sheets of FieldPoint Petroleum Corporation and subsidiaries (the Company) as of December 31, 2007 and 2006, and the related consolidated statements of operations, changes in stockholders equity and cash flows for the years then ended.  These consolidated financial statements are the responsibility of the Companys management.  Our responsibility is to express an opinion on these consolidated 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 consolidated financial statements referred to above present fairly, in all material respects, the financial position of FieldPoint Petroleum Corporation and subsidiaries as of December 31, 2007 and 2006, and the results of their operations and their cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.  We were not engaged to examine management's assertion about the effectiveness of the Companys internal control over financial reporting as of December 31, 2007 included in the accompanying 10-KSB and, accordingly, we do not express an opinion thereon.   HEIN& ASSOCIATES LLP   Dallas, Texas March 27, 2008  F-1    FIELDPOINT PETROLEUM CORPORATION   CONSOLIDATED BALANCE SHEETS  ASSETS  December 31,20072006CURRENT ASSETS:Cash and cash equivalents$ 1,484,469$ 603,614Short-term investments801,533771,962Accounts receivable:Oil and natural gas sales521,430458,209Joint interest billings, less allowance for doubtful accounts of
$99,192 each period140,604142,450Income taxes receivable117,600179,000Prepaid expenses and other current assets31,87056,508Total current assets3,097,5062,211,743PROPERTY AND EQUIPMENT:Oil and natural gas properties (successful efforts method)15,425,28911,477,963Other equipment89,24889,248Less accumulated depletion and depreciation(4,420,226)(3,371,562)Net property and equipment11,094,3118,195,649LONG-TERM JOINT INTEREST BILLING RECEIVABLE, less allowance for doubtful accounts of $44,624, each period68,36869,616Total assets$ 14,260,185$ 10,477,008LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Accounts payable and accrued expenses$ 587,911$ 52,442Oil and natural gas revenues payable136,437113,631Deferred income taxes-current14,200-Total current liabilities738,548166,073LONG-TERM DEBT3,489,1251,000,000DEFERRED INCOME TAXES739,500648,000ASSET RETIREMENT OBLIGATION676,344585,628COMMITMENTS AND CONTINGENCIES(Notes 9 and 10)STOCKHOLDERS EQUITY:Common stock, $.01 par value, 75,000,000 shares authorized;
8,910,175 and 8,747,175 shares issued and outstanding,
respectively89,10187,471Additional paid-in capital4,571,8094,368,350Retained earnings4,198,1643,640,086Treasury stock, 295,000 and 160,000 shares, respectively, at cost(242,406)(18,600)Total stockholders equity8,616,6688,077,307Total liabilities and stockholders equity$ 14,260,185$ 10,477,008  See accompanying notes to these consolidated financial statements.  F-2   FIELDPOINT PETROLEUM CORPORATION   CONSOLIDATED STATEMENTS OF OPERATIONS  December 31,20072006REVENUE:Oil and natural gas sales$ 4,251,190$ 3,880,105Well operational and pumping fees120,334119,987Disposal fees38,00053,500Total revenue4,409,5244,053,592COSTS AND EXPENSES:Production1,653,4671,406,925Exploration-5,467Depletion and depreciation870,069487,000Impairment of oil and natural gas properties276,635-Accretion of discount on asset retirement obligations43,76833,136General and administrative739,715548,235Total costs and expenses3,583,6542,480,763OPERATING INCOME825,8701,572,829OTHER INCOME (EXPENSE):Interest income12,24211,382Interest expense(113,635)(1,588)Unrealized gains on short-term investments29,571120,967Gain on sale of properties-17,320Miscellaneous income35,53025,055Total other income (expense)(36,292)173,136INCOME BEFORE INCOME TAXES789,5781,745,965INCOME TAX PROVISION current(125,800)(500,200)INCOME TAX PROVISION deferred(105,700)(64,000)TOTAL INCOME TAX PROVISION(231,500)(564,200)NET INCOME$ 558,078$ 1,181,765NET INCOME PER SHARE:BASIC$              0.06$               0.14DILUTED$             0.06$               0.13WEIGHTED AVERAGE SHARES OUTSTANDING:Basic8,832,7348,668,230Diluted8,886,1568,809,262   See accompanying notes to these consolidated financial statements.  F-3


FIELDPOINT PETROLEUM CORPORATION   CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY  For the Years Ended December 31, 2007 and 2006  Common StockAdditional
Paid-inRetainedTreasury StockSharesAmountCapitalEarningsSharesAmountTotalBALANCES, January 1, 20068,465,175$ 84,651$ 3,628,162$2,458,321160,000$ (18,600)$ 6,152,534Exercise of common stock options
and warrants272,0002,720174,080---176,800Income tax benefit on exercise of
stock options--506,000---506,000Shares issued in lieu of compensation10,00010060,108---60,208Net income---1,181,765--1,181,765BALANCES, December 31, 20068,747,17587,4714,368,3503,640,086160,000(18,600)8,077,307Purchase of treasury shares----135,000(223,806)(223,806)Exercise of common stock options
and warrants133,0001,33085,120---86,450Income tax benefit on exercise of
stock options--60,600---60,600Shares issued in lieu of compensation30,00030034,800---35,100Share based compensation--22,939---22,939Net income---558,078--558,078BALANCES, December 31, 20078,910,175$ 89,101$ 4,571,809$4,198,164295,000$ (242,406)$ 8,616,668  See accompanying notes to these consolidated financial statements.  F-4


FIELDPOINT PETROLEUM CORPORATION


CONSOLIDATED STATEMENTS OF CASH FLOWS  December 31,20072006CASH FLOWS FROM OPERATING ACTIVITIES:Net income$ 558,078$ 1,181,765Adjustments to reconcile to net cash provided by operating
activities:Unrealized  gains on short-term investments(29,571)(120,967)Gain on sale of properties-(17,320)Depletion and depreciation870,069487,000Impairment of oil and gas properties276,635-Deferred income taxes105,70064,000Accretion of discount on asset retirement obligations43,76833,136Share-based compensation expense58,03960,208Changes in assets and liabilities:Accounts receivable(60,127)(30,497)Income taxes receivable61,400(25,000)Prepaid expenses and other assets24,638(25,973)Accounts payable and accrued expenses535,469(23,532)Oil and natural gas revenues payable22,8069,651Other--Net cash provided by operating activities2,466,9041,592,471CASH FLOWS FROM INVESTING ACTIVITIES:Additions to oil and natural gas properties(417,671)(831,466)Acquisitions of oil and natural gas properties(3,580,747)(2,426,234)Proceeds from sale of property and equipment-17,320Purchase of transportation equipment-(38,320)Restricted cash-550,170Net cash used in investing activities(3,998,418)(2,728,530)CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from long-term debt2,500,0001,000,000Repayments of long-term debt(10,875)(150,000)Proceeds from exercise of options and warrants86,450176,800Income tax benefit on exercise of stock options60,600506,000Purchase of treasury shares(223,806)-Net cash provided by financing activities2,412,3691,532,800NET INCREASE IN CASH880,855396,741CASH, beginning of year603,614206,873CASH, end of the year$ 1,484,469$ 603,614SUPPLEMENTAL INFORMATION:Cash paid during the year for interest$         113,635$             1,588Cash paid during the year for income taxes$               -$           15,201





See accompanying notes to these consolidated financial statements.  F-5   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Organization and Nature of Operations FieldPoint Petroleum Corporation (the Company, we or our) is incorporated under the laws of the state of Colorado.  The Company is engaged in the acquisition, operation and development of oil and natural gas properties, which are located in Louisiana, New Mexico, Oklahoma, South-Central Texas and Wyoming as of December 31, 2007.  Consolidation Policy Our consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Bass Petroleum, Inc. and Raya Energy Corp.  All material intercompany accounts and transactions have been eliminated in consolidation.  Cash and Cash Equivalents We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.  Short Term Investments Short term investments consist primarily of holdings in mutual funds with readily determinable fair values.  These investments are bought and held principally, for the purpose of selling them in the near term and thus are classified as trading securities.  Trading securities are recorded at fair value on the balance sheet in current assets, with the change in fair value during the period classified as unrealized holding gains in other income.  All realized gains are included in other income.  Oil and Natural Gas Properties Our oil and natural gas properties are comprised of the following at December 31:  20072006Mineral interests in properties:Unproved properties$ 850,000$ 98,040Proved properties11,293,0119,074,764Wells and related equipment and facilities3,282,2782,305,159Total costs15,425,28911,477,963Less accumulated depletion and depreciation(4,348,544)(3,307,544)$ 11,076,745$ 8,170,419  We follow the successful efforts method of accounting for our oil and natural gas producing activities.  Costs to acquire mineral interests in oil and natural gas properties, to drill and equip exploratory wells that find proved reserves, to drill and equip development wells and related asset retirement costs are capitalized.  Costs to drill exploratory wells are capitalized pending determination of whether the wells have found proved reserves. If we determine that the wells do not find proved reserves, the costs are charged to expense.  There were no exploratory wells capitalized pending determination of whether the wells found proved reserves at December 31, 2007 or 2006.  Geological and geophysical costs, including seismic studies and costs of carrying and retaining unproved properties are charged to expense as incurred.  We capitalize interest on expenditures for significant exploration and development projects that   F-6   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    last more than six months while activities are in progress to bring the assets to their intended use.  Through December 31, 2007, we have capitalized no interest costs because our exploration and development projects generally last less than six months.  Costs incurred to maintain wells and related equipment are charged to expense as incurred.  On the sale or retirement of a complete unit of a proved property, the cost and related accumulated depletion and depreciation are eliminated from the property accounts, and the resulting gain or loss is recognized.  On the retirement or sale of a partial unit of proved property, the cost is charged to accumulated depletion and depreciation with a resulting gain or loss recognized in income.  Capitalized amounts attributable to proved oil and natural gas properties are depleted by the unit-of-production method of proved reserves using the unit conversion ratio of 6 Mcf of gas to 1 bbl of oil.  Depletion and depreciation expense for oil and natural gas producing property and related equipment was $862,405 and $463,000 for the years ended December 31, 2007 and 2006, respectively.  Unproved oil and natural gas properties that are individually significant are periodically assessed for impairment of value, and a loss is recognized at the time of impairment by providing an impairment allowance. We recorded an impairment of $98,040 during the year ended December 31, 2007 related to our assessment of unproved properties. The impairment resulted from our decision to abandon certain leaseholds in the Hutt Field located in McMullen County, Texas.  We noted no impairments of our unproved properties for the year ended 2006.  Capitalized costs related to proved oil and natural gas properties, including wells and related equipment and facilities, are evaluated for impairment based on an analysis of undiscounted future net cash flows in accordance with Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets.  If undiscounted cash flows are insufficient to recover the net capitalized costs related to proved properties, then we recognize an impairment charge in income from operations equal to the difference between the net capitalized costs related to unproved properties and their estimated fair values based on the present value of the related future net cash flows.  We recorded an impairment of $178,595 during the year ended December 31, 2007 on our proved oil and natural gas properties.  The impairment was the result of cessation of production on certain wells in McMullen County, Texas.  We noted no impairments of our proved oil and natural gas properties based on our analysis for the year ended December 31, 2006.  On the sale of an entire interest in an unproved property for cash or cash equivalent, gain or loss on the sale is recognized, taking into consideration the amount of any recorded impairment if the property had been assessed individually. If a partial interest in an unproved property is sold, the amount received is treated as a reduction of the cost of the interest retained.  Joint Interest Billings Receivable and Oil and Natural Gas Revenues Payable Joint interest billings receivable represent amounts receivable for lease operating expenses and other costs due from third party working interest owners in the wells that the Company operates.  The receivable is recognized when the cost is incurred and the related payable and the Companys share of the cost is recorded.    F-7   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    The Company uses the reserve for bad debt method of valuing doubtful joint interest billings receivable based on historical experience, coupled with a review of the current status of existing receivables.  The balance of the reserve for doubtful accounts, deducted against joint interest billings receivable to properly reflect the realizable value is $99,192 at December 31, 2007 and 2006.  Oil and natural gas revenues payable represents amounts due to third party revenue interest owners for their share of oil and natural gas revenue collected on their behalf by the Company.  The payable is recorded when the Company recognizes oil and natural gas sales and records the related oil and natural gas sales receivable.  The Company has $68,368 and $69,616 net joint interest billing receivable from a company in receivership at December 31, 2007 and 2006, respectively.  The receiver has indicated he intends to settle the amount due by conveying oil and natural gas properties to the Company.  This settlement has not yet been approved by the bankruptcy court.  The Company anticipates that it will receive the properties, and that the value of the properties will be adequate to recover the amount due; however if the settlement is not approved, the Company may be unable to recover the receivable and further write-downs of the receivable balance may be necessary.  Based on the above facts, the Company has classified the receivable as long-term.  Other Property Other assets classified as property and equipment are primarily office furniture and equipment and vehicles, which are carried at cost.  Depreciation is provided using the straight-line method over estimated useful lives ranging from three to five years.  Gain or loss on retirement or sale or other disposition of assets is included in income in the period of disposition.  Depreciation expense for other property and equipment was $7,664 and $24,000 for the years ended December 31, 2007 and 2006, respectively.  Asset Retirement Obligations On August 15, 2001, the FASB issued Statement No. 143, Accounting for Asset Retirement Obligations (Statement 143).  That standard requires entities to record the fair value of a liability for asset retirement obligation in the period in which it was incurred.    F-8   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    The following is a reconciliation of the Companys asset retirement obligations for the years ended December 31: 20072006Asset retirement obligation at January 1,$ 585,628$ 549,885Accretion of discount43,76833,136Liabilities incurred during the year46,9482,607Liabilities settled during the year--Asset retirement obligation at December 31,$ 676,344$ 585,628  Income Taxes Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due, if any, plus net deferred taxes related primarily to differences between the bases of assets and liabilities for financial and income tax reporting.  Deferred tax assets and liabilities represent the future tax consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled.  Deferred tax assets include recognition of operating losses that are available to offset future taxable income and tax credits that are available to offset future income taxes.  Valuation allowances are recognized to limit recognition of deferred tax assets where appropriate.  Such allowances may be reversed when circumstances provide evidence that the deferred tax assets will more likely than not be realized.  Production Taxes and Ad Valorem Taxes Production taxes and ad valorem taxes are included in production expense.  Total production and ad valorem taxes were $322,246 and $319,314 for the years ended December 31, 2007 and 2006, respectively.  Use of Estimates and Certain Significant Estimates The preparation of the Companys financial statements in conformity with generally accepted accounting principles requires the Companys management to make estimates and assumptions that affect the amounts reported in these financial statements and accompanying notes.  Actual results could differ from those estimates.  Significant assumptions are required in the valuation of proved oil and natural gas reserves, which as described above may affect the amount at which oil and gas natural properties are recorded.  The Companys allowance for doubtful accounts is a significant estimate and is based on managements estimates of uncollectible receivables.  It is at least reasonably possible these estimates could be revised in the near term and the revisions could be material.  Revenue Recognition The Company uses the sales method of accounting for oil and natural gas revenues. Under this method, revenues are based on actual volumes of oil and natural gas sold to purchasers. The volumes of natural gas sold may differ from the volumes to which the Company is entitled based on its interest in the properties. Differences between volumes sold and volumes based on entitlements create natural gas   F-9   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    imbalances. Material imbalances are reflected as adjustments to reported natural gas reserves and future cash flows. There were no material natural gas imbalances as of December 31, 2007 and 2006.  Reclassifications Certain amounts in the prior period financial statements have been reclassified to conform to the 2007 financial statement classification, with no effect on net income.  Comprehensive Income The Company has no elements of comprehensive income other than net income.  Share-Based Compensation We measure and record compensation expense for all share-based payment awards to employees and directors based on estimated fair values.  Additionally, compensation costs for share-based awards are recognized over the requisite service period based on the grant-date fair value.  Recently Issued Accounting Pronouncements In September 2006, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS No. 157).  SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurement. SFAS No. 157 also emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and sets out a fair value hierarchy with the highest priority being quoted prices in active markets.  Under SFAS No. 157, fair value measurements are disclosed by level within that hierarchy.  This Statement is effective for fiscal years beginning after November 15, 2007.  In February 2008, the FASB issued FASB Staff Position No. FAS 157-2, which defers the effective date of SFAS 157 for nonfinancial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually) to fiscal years beginning after November 15, 2008 and interim periods within those years.  We do not expect the adoption of SFAS 157 will have a significant impact on our financial statements.  In February 2007, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (SFAS No. 159).  SFAS No.159 permits companies to elect to follow fair value accounting for certain financial assets and liabilities in an effort to mitigate volatility in earnings without having to apply complex hedge accounting provisions.  The standard also establishes presentation and disclosure requirements designed to facilitate comparison between entities that choose different measurement attributes for similar types of assets and liabilities.  SFAS No. 159 is effective for fiscal years beginning after November 15, 2007.   SFAS No. 159 is not expected to have a material impact on the Companys financial position, results of operations or cash flows.  In July 2006, the Financial Accounting Standards Board (FASB) issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes  an interpretation of FASB Statement 109(FIN 48).  FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes.  FIN 48 prescribes a comprehensive model for recognizing, measuring, presenting and disclosing in the financial statements tax positions taken or expected to be taken on a tax return.  FIN 48 is effective for fiscal years beginning after December 15, 2007.  The cumulative effect of applying the provisions of FIN 48, if any,   F-10   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    will be reported as an adjustment to the opening balance of retained earnings for the fiscal year of adoption.  The Company adopted FIN 48 on January 1, 2007 and its adoption did not have a material impact on its consolidated financial position, results of operations or cash flows.  See Note 5.  In December 2007, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 141R, Business Combinations, and Statement of Financial Accounting Standards No. 160, Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51.  These new standards significantly change the accounting for and reporting of business combination transactions and noncontrolling interests (previously referred to as minority interests) in consolidated financial statements.  Both standards are effective for fiscal years beginning on or after December 15, 2008, with early adoption prohibited. These Statements are effective for the Company beginning on January 1, 2009.  The Company is currently evaluating the provisions of FAS 141(R) and FAS 160.  In March 2008, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 161, Disclosures About Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133.  This new standard enhances the disclosure requirements related to derivative instruments and hedging activities required by FASB Statement No. 133.  This standard is effective for fiscal years and interim periods beginning after November 15, 2008, with early adoption encouraged.  We adopted the required provisions of SFAS 161 on January 1, 2008 and the adoption did not have a significant impact on our financial statements.   F-11   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    2. ACQUISITION OF OIL AND NATURAL GAS PROPERTIES  On December 27, 2007, the Company consummated the purchase of a 100% working interest representing a 85.5% net revenue interest in an oil property located in the Sulimar Field in Chaves County, New Mexico with an effective date of January 1, 2008.  The purchase price for the interest was $1,700,135 of which $1,500,000 was drawn on the Companys line of credit and the balance paid from cash on hand.  On July 31, 2007, the Company was the successful bidder for the acquisition of a 25.23150% working interest and a 22.077% net revenue interest in the Apache Bromide Unit located in Caddo County, Oklahoma with an effective date of August 1, 2007.  The purchase price for the interest was $1,880,611, of which $1,000,000 was drawn on the Companys line of credit and the balance paid from cash on hand.   The following unaudited pro forma information is presented as if the interest in the Apache Bromide Unit and the Sulimar properties had been acquired on January 1, 2007. Pro Forma
Results For The
Year Ended
December 31,2007(unaudited)Revenues$ 5,297,580Net income$ 816,019Net income per share  basic (net of tax)$ 0.09Net income per share  diluted (net of tax)$ 0.09  On December 27, 2006, the Company consummated the purchase of a 50% working interest representing a 43.25% net revenue interest in a natural gas property located in the Bilbrey Field in Lea County, New Mexico with an effective date of January 1, 2007.  The Company paid $1,670,000 cash consideration for the lease rights and related equipment.  The funds for the acquisition were derived from the Companys existing revolving credit facility and cash on hand.  3. RELATED PARTY TRANSACTIONS  The Company leases office space from its President.  Rent expense for this month-to-month lease was $30,000 for each of the years ended December 31, 2007 and 2006, respectively.  The Company also paid Roger Bryant, a director, $11,500 in consulting fees for services in 2007 and $3,600 during 2006.  4. LONG-TERM DEBT  The Company has a line of credit with a bank with a borrowing base of $5,000,000 at December 31, 2007 with interest at prime less one half point (6.75% at December 31, 2007), requiring monthly interest-only   F-12   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    payments until maturity on October 18, 2010.  All outstanding principal is due at maturity.  This note is collateralized by certain oil and natural gas properties.  Total amounts outstanding under the line of credit were $3,489,125 and $1,000,000 at December 31, 2007 and 2006, respectively.  The Company has certain financial covenants and ratios in its debt agreement.  These financial covenants include current ratio, leverage ratio, and interest coverage ratio requirements.  At December 31, 2007 and 2006, the Company was in compliance with all financial covenants.  5. INCOME TAXES  Our provision for income taxes comprised the following during the years ended December 31:  20072006Current:Federal$ 101,400$ 422,000State24,40078,200Total current125,800500,200Deferred:Federal105,70056,000State-8,000Total deferred105,70064,000Total income tax provision$ 231,500$ 564,200  Total income tax expense (benefit) differed from the amounts computed by applying the U.S. Federal statutory tax rates and estimated state rates to pre-tax income for the years ended December 31, 2007 and 2006 as follows:  20072006Statutory rate34%34%State taxes, net of federal benefit3%3%Changes in enacted rates-(1%)Other differences(8%)(4%)Effective rate29%32%  In May 2006, the State of Texas enacted a margin tax which requires us to determine a tax of 1.0% on our margin, as defined in the law, based on our operating results beginning January 1, 2007.  The margin to which the tax rate will be applied is generally calculated as our revenues for federal income tax purposes less the cost of the products sold for federal income tax purposes, in the State of Texas.  Cost of products sold includes our lease operating expenses, production taxes, depletion and depreciation expense, and a portion of our salaries.  Some of our operations are within the state of Texas.  Under the provisions of Statement of Financial Accounting Standards No. 109, Accounting for Income Taxes, we are required to record the effects on deferred taxes for a change in tax rates or tax law in the period which includes the enactment date.  Previously, our results of operations were subject to income taxes in Texas at a rate of 4.5%, before consideration of federal benefits of those state taxes.  Temporary differences between book and tax income related to our Texas oil and gas properties will minimally affect the Texas margin tax, and therefore we have not changed our deferred taxes.   F-13   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS     Deferred tax assets and liabilities are the result of temporary differences between the financial statement carrying values and tax bases of assets and liabilities.  Our net deferred tax assets and liabilities are recorded as a liability of $753,700 and $648,000 at December 31, 2007 and 2006, respectively.  Significant components of net deferred tax assets and liabilities are: December 31,20072006Deferred tax assets:Asset retirement obligation liability$ 230,600$ 216,000Depletion carryover19,900-Allowance for doubtful accounts52,70053,000Total deferred tax assets303,200269,000Deferred tax liability:Difference in depreciation, depletion and capitalization methods - oil and gas properties(990,000)(860,000)Unrealized gain on marketable securities(66,900)(57,000)Total deferred tax liabilities(1,056,900)(917,000)Net deferred tax liability$ (753,700)$ (648,000)  At December 31, 2007, the Company had available depletion carryforwards totaling approximately $54,000 which may be used to reduce future taxable income and do not expire.  The Company adopted the provisions of FIN 48, Accounting for Uncertainty in Income Taxes, on January 1, 2007.  The Company had no material unrecognized income tax assets or liabilities at the date of adoption nor during the year ended December 31, 2007.  The Companys policy regarding income tax interest and penalties is to expense those items as general and administrative expense but to identify them for tax purposes.  During the year ended December 31, 2007, there were no income tax interest and penalty items in the income statement, nor as a liability on the balance sheet.  The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions.  Generally, the Company is no longer subject to U.S. federal or state income tax examination by tax authorities for years before 2004.  The Company is not currently involved in any income tax examinations.  6. EARNINGS PER SHARE  Basic earnings per share is computed based on the weighted average number of shares of common stock outstanding during the year.  Diluted earnings per share takes common stock equivalents (such as options and warrants) into consideration.  The following table sets forth the computation of basic and diluted earnings per share:     F-14   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS     December 31,20072006Numerator:Numerator for basic and diluted net income per share$ 558,078$ 1,181,765Denominator:Denominator for basic net income per share  weighted average shares8,832,7348,668,230Denominator for diluted net income per shareWeighted average shares outstanding8,832,7348,668,230Dilutive effect of stock options53,422141,032Diluted weighted average shares8,886,1568,809,262Basic net income per share$            0.06$            0.14Diluted net income per share$            0.06$            0.13  7. SHARE-BASED COMPENSATION  From time to time, the Company grants stock options under a non-qualified stock option plan to its employees and directors.  The following is a summary of activity for the stock options granted for the years ended December 31, 2007 and 2006: December 31, 2007December 31, 2006Number
of SharesWeighted
Average
Exercise
PriceNumber
of SharesWeighted
Average
Exercise
PriceOutstanding, beginning of year133,000$ 0.65405,000$         0.65Canceled or expired-$          --$           -Granted-$          --$           -Exercised133,000$        0.65272,000$         0.65Outstanding, end of year-$         -133,000$         0.65Exercisable, end of year-$         -133,000$         0.65  During the years ended December 31, 2007 and 2006, no stock options were granted or vested.  The total intrinsic value or the difference between the exercise price and the market price on the date of exercise, of options exercised was approximately $166,130 and $1,331,000 during the years ended December 31, 2007 and 2006, respectively.  There was a tax benefit of $60,600 and $506,000 recognized related to the exercise of options for the years ended December 31, 2007 and 2006, respectively.  Cash received from stock options exercised during the years ended December 31, 2007 and 2006 was $86,450 and $176,800, respectively.   F-15   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS     8. STOCKHOLDERS EQUITY  During the year ended December 31, 2007, the Company issued 30,000 restricted shares of its common stock to directors in lieu of compensation.  The restricted shares were 100% vested upon issuance.  During the year ended December 31, 2006, the Company issued 10,000 restricted shares of its common stock to a director in lieu of compensation.  The restricted shares vest and become unrestricted over two years from the grant date as follows:  2,500 sharesAugust 20062,500 sharesFebruary 20075,000 sharesAugust 2008  The Company recognized $58,039 and $60,208 compensation expense related to the shares issued during 2007 and 2006, respectively.  9. ENVIRONMENTAL ISSUES  The Company is engaged in oil and natural gas exploration and production and may become subject to certain liabilities as they relate to environmental clean up of well sites or other environmental restoration procedures as they relate to the drilling of oil and natural gas wells and the operation thereof.  In the Companys acquisition of existing or previously drilled well bores, the Company may not be aware of what environmental safeguards were taken at the time such wells were drilled or during such time the wells were operated.  Should it be determined that a liability exists with respect to any environmental clean up or restoration, the liability to cure such a violation could fall upon the Company.  No claim has been made, nor is the Company aware of any liability which the Company may have, as it relates to any environmental clean up, restoration or the violation of any rules or regulations relating thereto.  10. COMMITMENTS  As of December 31, 2007 and 2006, the Company had a $10,000 open letter of credit in favor of the State of Wyoming as a plugging bond.  The letter of credit is collateralized by a certificate of deposit in the same amount.  In 2001, the Company entered into an executive employment agreement with its president and CEO.  The agreement provides for his retention, if the Company should have a change in control, at set percentages of his then salary and bonus for a term of at least three years.  11. FAIR VALUE OF FINANCIAL INSTRUMENTS AND CONCENTRATION OF CREDIT RISK  The Companys financial instruments are cash, short term investments, accounts receivable and payable and long-term debt.  Management believes the fair values of these instruments, with the exception of the long-term debt, approximate the carrying values, due to the short-term nature of the instruments.    F-16   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    Management believes the fair value of long-term debt also reasonably approximates its carrying value, based on expected cash flows and interest rates. Financial instruments that subject the Company to credit risk consist principally of receivables.  The receivables are primarily from companies in the oil and natural gas business or from individual oil and natural gas investors.  These parties are primarily located in the Southwestern region of the United States.  The Company does not ordinarily require collateral, but in the case of receivables for joint operations, the Company often has the ability to offset amounts due against the participants share of production from the related property.  The Company believes the allowance for doubtful accounts at December 31, 2007 and 2006 is adequate.  For the years ended December 31, 2007 and 2006, sales to four purchasers amounted to 64% and 71% of our total oil and natural gas sales, respectively.  Additionally, amounts receivable from those purchasers amounted to 58% and 71% of total oil and natural gas sales receivable at December 31, 2007 and 2006, respectively.  The loss of one or more of these purchasers could have a material adverse impact on our results of operations.  We believe that there are potential alternative purchasers and that it may be necessary to establish relationships with new purchasers.  However, there can be no assurance that such efforts will be successful in the identification of one or more new purchasers.  The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents.  12. SUPPLEMENTAL INFORMATION ON OIL AND GAS PRODUCING ACTIVITIES (UNAUDITED)  The following table sets forth certain information with respect to the oil and natural gas producing activities of the Company: Years Ended December 31,20072006Costs incurred in oil and natural gas producing activities:Acquisition of unproved properties$ 450,000$              -Acquisition of proved properties3,130,7472,438,340Dry hole expense-5,467Development costs417,671819,360Total costs incurred$ 3,998,418$ 3,263,167    F-17   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS     Set forth below is certain information regarding the results of operations for oil and natural gas producing activities: Years Ended December 31,20072006Oil and natural gas sales$ 4,251,190$ 3,880,105Disposal fees38,00053,500Production costs(1,653,467)(1,406,925)Exploration expense-(5,467)Depletion and depreciation expense(862,405)(463,000)Impairment(276,635)-Accretion of discount on asset retirement obligations(43,768)(33,136)Income tax expenses(426,000)(654,000)Results of operations$ 1,026,915$ 1,371,077   F-18   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


The following table summarizes changes in the estimates of the Companys net interest in total proved reserves of crude oil and condensate and natural gas, all of which are domestic reserves.  There can be no assurance that such estimates will not be materially revised in subsequent periods.  Oil
(Barrels)Gas
(MCF)Balance, January 1, 2006935,3092,103,689Revisions of previous estimates(140,369)(285,768)Extensions and discoveries8333,237Purchase of minerals in place-339,683Production(49,079)(122,935)Balance, December 31, 2006746,6942,037,906Revisions of previous estimates55,398700,820Extensions and discoveries-143,927Purchase of minerals in place
Production130,718
(47,561)-
(139,392)Balance, December 31, 2007885,2492,743,261Proved developed reserves, December 31, 2007769,3191,785,240Proved developed reserves, December 31, 2006637,6521,761,909  Proved oil and natural gas reserves are the estimated quantities of crude oil, condensate and natural gas which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions.  Proved developed oil and natural gas reserves are reserves that can be expected to be recovered through existing wells with existing equipment and operating methods.  The above estimated net interests in proved reserves are based upon subjective engineering judgments and may be affected by the limitations inherent in such estimation.  The process of estimating reserves is subject to continual revision as additional information becomes available as a result of drilling, testing, reservoir studies and production history, and market prices for oil and natural gas.  Significant fluctuations in market prices have a direct impact on recoverability and will result in changes in estimated recoverable reserves without regard to actual increases or decreases in reserves in place.   Year Ended December 31, 2006 We purchased the working interests of one of the non-operating participants in our North Bilbrey field during 2006, which accounts for the additional quantities listed under purchases of minerals in place.  The average natural gas price attributable to our proved reserves decreased from $6.68 per Mcf at December 31, 2005 to $5.49 per Mcf at December 31, 2006, which was the primary reason for the decreased quantities listed under revisions to previous estimates.  Year Ended December 31, 2007 We purchased a working interest in an oil property located in the Sulimar field in Chaves County, New Mexico during 2007.  We also purchased a working interest and a net revenue interest in the Apache Bromide unit located in Caddo County, Oklahoma during 2007.  These purchases account for the additional quantities listed under purchases of minerals in place.  We completed the Chronos


F-19   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


No. 1 and the Hermes Fee 1 properties in New Mexico during 2007, which was the primary reason for the quantities listed under extensions and discoveries.  The average natural gas price attributable to our proved reserves increased from $5.49 per Mcf at December 31, 2006 to $6.63 per Mcf at December 31, 2007, which was the primary reason for the increased quantities listed under revisions to previous estimates.  13. STANDARDIZED MEASURE OF DISCOUNTED FUTURE NET CASH FLOWS (UNAUDITED)  The standardized measure of discounted future net cash flows at December 31, 2007 and 2006, relating to proved oil and natural gas reserves is set forth below.  The assumptions used to compute the standardized measure are those prescribed by the Financial Accounting Standards Board and, as such, do not necessarily reflect the Companys expectations of actual revenues to be derived from those reserves nor their present worth.  The limitations inherent in the reserve quantity estimation process are equally applicable to the standardized measure computations since these estimates are the basis for the valuation process.  The estimated cash flows from future production of proved reserves were prepared on the basis of prices received at year end.  The average oil price per barrel was approximately $91.09 and $55.13 at December 31, 2007 and 2006, respectively.  The average natural gas price per MMBtu was approximately $6.46 and $5.52 at December 31, 2007 and 2006, respectively.  Years Ended December 31,20072006Future cash inflows$ 98,588,000$ 52,866,000Future production costs(26,611,000)(14,236,000)Future development cost(878,000)(819,000)Future income taxes(23,325,000)(11,914,000)Future net cash flows47,774,00025,897,00010% annual discount(21,931,000)(11,523,000),Standardized measure of discounted future net cash
flows$ 25,843,000$ 14,374,000


F-20   FIELDPOINT PETROLEUM CORPORATION  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Future net cash flows were computed using year-end prices and costs, and year-end statutory tax rates (adjusted for permanent differences) that relate to existing proved oil and natural gas reserves at year end.  The following are the principal sources of change in the standardized measure of discounted future net cash flows: Years Ended December 31,20072006Balance, beginning of year$ 14,374,000$ 17,052,000Sales of oil and natural gas produced, net of production
costs(2,636,000)(2,473,000)Purchase of minerals in place3,808,0001,124,000Extensions and discoveries699,00027,000Net changes in prices and production costs9,964,000(2,000,000)Net changes in future development costs(32,000)26,000Revisions and other changes3,752,000(4,310,000)Accretion of discount1,961,0002,214,000Net change in income taxes(6,047,000)2,714,000Balance, end of year$ 25,843,000$ 14,374,000    ***********


F-21


ITEM 8CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING  AND FINANCIAL DISCLOSURE  None.  ITEM 8A.     CONTROLS AND PROCEDURES  a)The Company's Principal Executive Officer and Principal Financial Officer, Ray Reaves, has established and is currently maintaining disclosure controls and procedures for the Company.  The disclosure controls and procedures have been designed to provide reasonable assurance that the information required to be disclosed by the Company in reports that it files under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and to ensure that information required to be disclosed by the Company is accumulated and communicated to the Company's management as appropriate to allow timely decisions regarding required disclosure.

The Principal Executive Officer and Principal Financial Officer conducted a review and evaluation of the effectiveness of the Company's disclosure controls and procedures and have concluded, based on his evaluation as of the end of the period covered by this Report, that our disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commissions rules and forms and to ensure that the information required to be disclosed by the Company is accumulated and communicated to management, including our principal executive officer and our principal financial officer, to allow timely decisions regarding required disclosure.b)There has been no change in our internal control over financial reporting during the fourth quarter ended December 31, 2007 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.  Our principal executive and financial officer does not expect that our disclosure controls or internal controls will prevent all error and all fraud. Although our disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives and our principal executive and financial officer has determined that our disclosure controls and procedures are effective at doing so, a control system, no matter how well conceived and operated, can provide only reasonable, not absolute assurance that the objectives of the system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented if there exists in an individual a desire to do so. There can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.   22       Managements Report on Internal Control Over Financial Reporting  Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company.  Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that:  1)  Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;  2)  Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and,  3)  Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Companys assets that could have a material effect on the Companys financial statements.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.  Management has used the framework set forth in the report entitled Internal Control  Integrated Framework published by the Committee of Sponsoring Organizations of the Treadway Commission to evaluate the effectiveness of the Companys internal control over financial reporting.  Management has concluded that the Companys internal control over financial reporting was effective as of the end of the most recent fiscal year.  This annual report does not include an attestation report of the Companys registered public accounting firm regarding internal control over financial reporting.  Managements report was not subject to attestation by the Companys registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only managements report in this Form 10-KSB.  23       PART III   ITEM 9DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT  (a)Identification of Directors and Executive Officers.  The following table sets forth the names and ages of the Directors and Executive Officers of the Company, all positions and offices with the Company held by such person, and the time during which each such person has served:  NameAgePosition with CompanyPeriod ServedRay D. Reaves46Director, President,
Chairman, Chief
Executive OfficerMay 1997-presentRoger D. Bryant65DirectorJuly 1997-presentKarl W. Reimers66DirectorOctober 2004-presentDan Robinson60DirectorAugust 2004-presentMel Slater66DirectorJanuary 2003-presentDebra Funderburg49DirectorFebruary 2006 - present  Mr. Reaves, age 46, has been Chairman, Director, President, Chief Executive Officer and Chief Financial Officer of the Company since May 22, 1997.  Mr. Reaves has also served as Chairman, Chief Executive Officer, Chief Financial Officer and Director of Bass Petroleum, Inc. from October 1989 to the present, has 18 years experience in the oil and natural gas industry. He began his career in 1987, with North American Oil and Gas. Subsequently, in 1989 he purchased an interest in 10 of their wells and formed Bass Petroleum, Inc. Under Mr. Reaves management in the years that followed, Bass Petroleum, Inc., gained majority control of the 10 original wells and acquired interest in another 60 wells. In 1998, Bass Petroleum merged with Energy Production Corporation and as a result, FieldPoint Petroleum Corporation was born.  Roger D. Bryant, age 65, has been a Director of the Company since July 1997.  For more than twenty-five years, Mr. Bryant has held senior management positions with public and private start-up and turn-around technology companies in a number of different industries. He is currently President and CEO of Convergence Technology Application Partners, LLC (CTAP), a supplier of telecommunications systems and support to companies with widely distributes offices. Prior positions include Chief Operations Officer for Electric and Gas Technologies, Inc., Chief Executive Officer of International Gateway Exchange, President and Chairman of Dial-thru International, Inc., President of Network Data Corporation, President of Dresser Industries, Inc., Wayne Division, President of Schlumberger Limited, Retail Petroleum Systems Division, U.S.A., a division of Schlumberger Corporation, and President of Autogas Systems, Inc., the developer of Pay-at-the-Pump technology for retail petroleum industry. All together, Mr. Bryant has held the Chief Executive position as well as serving on the board of directors, of more than ten private and public companies.  Mr. Reimers, age 66, is a CPA and has served as a director of the Company since October 2004. Mr. Reimers has held the position of President and CFO of B.A.G. Corp. from 1993 to the present. He served as Vice President CFO of Supreme Beef Company from 1989 to 1993.  He also served as  24       Vice President of Accounting for OKC Corp. a NYSE listed oil and gas company from 1975 to 1989. He was employed by Peat, Marwick, Mitchell, Certified Public Accountants from 1973 to 1975, and he has a MBA from the University of Texas at Arlington.  Mr. Robinson, age 60, has served as a director of the Company since August 2004.  He has held the position of President and Chief Executive Officer of Placid Refining Company LLC from December 2004 to the present. Prior to his current position, he served in many capacities with Placid Oil Company beginning in March 1975, including the roles of Project Engineer, Manager of Refinery Operations, Assistant Secretary, Assistant Treasurer, Secretary, and Treasurer.  Before beginning his 30 year oil and gas career he was briefly employed as a commercial credit analyst at First National Bank in Dallas.  Mr. Robinson received a BS degree in Mechanical Engineering in 1971 and an MBA degree in Finance in 1973, both from the University of Wisconsin.  He currently sits on the Board of Directors of the National Petrochemical and Refiners Association.  Mel Slater, age 65, has been a Director of the Company since January 1, 2003.  From April 2003 to June 2005 Dr. Slater has served as President of National ICT Australia. Prior to joining National ICT  Dr. Slater spent more than 25 years with leading technology firms including Gemplus and Motorola. At Motorola, he served in a number of positions including Vice President and General Manager, Global Software Group Americas, Vice President and Director of Motorola's Arizona Technology Laboratories and as Motorola's Corporate Director of Software. Dr. Slater has managed operations in over ten countries.  Debra Funderburg, age 48, has been a Director of the Company since February 6, 2006.  From September 2007 to the present she has served as Business Development manager and Reservior Engineer for Sanchez Oil & Gas.  From May 2003 to August 2007 she has served as Senior Reservoir Engineer, Corporate A&D coordinator and is currently Business Development manager for Dominion E&P.  From November 1999 to May 2003 Ms. Funderburg held the position of Reservoir Engineering Manager for Randall & Dewey.  From April 1993 to November 1999 she was employed by Pennzoil as a Senior Petroleum Engineer.  No family relationship exists between any director or executive officer.  There are no material proceedings to which any director, officer or affiliate of the Company, any owner of record or beneficially of more than five percent (5%) of any class of voting securities of the Company, or any associate of any such director, officer, affiliate of the Company, or security holder is a party adverse to the Company or any of its subsidiaries or has a material interest adverse to the Company or any of its subsidiaries.  During the last five (5) years no director or officer of the Company has:  a.had any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;b.been convicted in a criminal proceeding or subject to a pending criminal proceeding;c.been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or  25        d.been found by a court of competent jurisdiction in a civil action, the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.  Any transactions between the Company and its officers, directors, principal shareholders, or other affiliates have been and will be on terms no less favorable to the Company than the Board of Directors believes could be obtained from unaffiliated third parties on an arms-length basis and will be approved by a majority of the Company's independent, outside disinterested directors.  Meetings and Committees of the Board of Directors  a.Meetings of the Board of Directors  During the fiscal year ended December 31, 2007, four meetings of the Board of Directors were held, including regularly scheduled and special meetings, each of which were attended by all of the Directors. Meetings are conducted either in person or by telephone conference.  Outside Directors receive $500 per meeting and were reimbursed their expenses associated with attendance at such meetings or otherwise incurred in connection with the discharge of their duties as a Director.  Directors received a grant of options to purchase up to 100,000 shares of common stock at the date of their appointment and could receive an additional grant of options to purchase shares of common stock, as long as they continue to serve as directors.  Ms. Funderburg receives a $12,000 annual retainer and is reimbursed for all expenses and received 10,000 shares of FieldPoint Petroleum Corp for her service as a board member.  b.Committees  The board appoints committees to help carry out its duties. In particular, board committee work on key issues in greater detail than would be possible at full board meetings.  Each committee reviews the result of its meetings with the full board.  During the year ended December 31, 2007, the board had a standing audit committee, a standing compensation committee, and a standing nomination committee.  Audit Committee  The audit committee was composed of the following directors:  Karl W. Reimers, Chairman
Dan Robinson
Roger D. Bryant  The Board of Directors has determined that Messrs. Reimers, Robinson and Bryant are "independent" within the meaning of the American Stock Exchange's listing standards.  For this purpose, an audit committee member is deemed to be independent if he does not possess any vested interests related to those of management and does not have any financial, family or other material personal ties to management.   26       Karl Reimers, a members of the audit committee, qualifies as an "audit committee financial expert" within the meaning of Item 401(e)(2) of Regulation SB.  During the fiscal year ended December 31, 2007 the audit committee had four meetings. The committee is responsible for accounting and internal control matters.  The audit committee:   -reviews with management, the internal auditors and the independent auditors policies and procedures with respect to internal controls;-reviews significant accounting matters;-approves any significant changes in accounting principles of financial reporting practices;-reviews independent auditor services; and-Recommends to the board of directors the firm of independent auditors to audit our consolidated financial statements.  In addition to its regular activities, the committee is available to meet with the independent accountants, controller or internal auditor whenever a special situation arises.  The Audit Committee of the Board of Directors has adopted a written charter, which has been previously filed with the Commission.  Audit Committee Report  The Audit Committee has reviewed and discussed the audited financial statements with management and with Hein & Associates LLP and the matters required to be discussed by SAS 61.  The Audit Committee has received the written disclosures and the letter from Hein & Associates LLP required by Independence Standards Board Standard No. 1 and has discussed with them their independence.  Based on the review and discussions referred to above, the Audit Committee has recommended to the Board of Directors that the audited financial statements be included in the Company's Annual Report of Form 10-KSB for the fiscal year ended December 31, 2007 for filing with the Commission.  By the Audit Committee Karl Reimers Dan Robinson Roger Bryant Compensation Advisory Committee  The compensation advisory committee is currently composed of the following directors:  Dan Robinson, Chairman
Karl Reimers
Mel Slater   27       The Board of Directors has determined that Messrs. Reimers, Robinson and Bryant are "independent" within the meaning of the American Stock Exchange's listing standards.  For this purpose, a compensation committee member is deemed to be independent if he does not possess any vested interests related to those of management and does not have any financial, family or other material personal ties to management.  During the fiscal year ended December 31, 2007 the compensation advisory committee had two meeting.  The compensation advisory committee:  -Recommends to the board of directors the compensation and cash bonus opportunities based on the achievement of objectives set by the compensation advisory committee with respect to our chairman of the board and president, our chief executive officer and the other executive officers;-administers our compensation plans for the same executives;-determines equity compensation for all employees;-reviews and approves the cash compensation and bonus objectives for the executive officers; and-reviews various matters relating to employee compensation and benefits.  Nomination Committee  The nomination committee was composed of the following directors:  Ray D. Reaves, Chairman Roger D. Bryant Mel Slater  Of the currently serving three members Messrs. Bryant and Slater, would each be deemed to be independent within the meaning of the American Stock Exchange's listing standards.  For this purpose, a director is deemed to be independent if he does not possess any vested interests related to those of management and does not have any financial, family or other material personal ties to management.  The board of directors has not adopted a policy with regard to the consideration of any director candidates recommended by security holders, since to date the board has not received from any security holder a director nominee recommendation.  The board of directors will consider candidates recommended by security holders in the future. Security holders wishing to recommended a director nominee for consideration should contact Mr. Ray Reaves, Chief Executive Officer and Chief Financial Officer, at the Company's principal executive offices located in Cedar Park, Texas and provide to Mr. Reaves, in writing, the recommended director nominee's professional resume covering all activities during the past five years, the information required by Item 401 of Regulation SB, and a statement of the reasons why the security holder is making the recommendation. Such recommendation must be received by the Company before December 31, 2008.   28       The board of directors believes that any director nominee must possess significant experience in business and/or financial matters as well as a particular interest in the Company's activities.  All director nominees identified in this proxy statement were recommended by our President and Chief Financial Officer and unanimously approved by the board of directors.  Shareholder Communications  Any shareholder of the Company wishing to communicate to the board of directors may do so by sending written communication to the board of directors to the attention of Mr. Ray Reaves, Chief Executive Officer and Chief Financial Officer, at the principal executive offices of the Company.  The board of directors will consider any such written communication at its next regularly scheduled meeting.  Any transactions between the Company and its officers, directors, principal shareholders, or other affiliates have been and will be on terms no less favorable to the Company than could be obtained from unaffiliated third parties on an arms-length basis and will be approved by a majority of the Company's independent, outside disinterested directors.  Code of Ethics  Our Board of Directors adopted a Code of Business Conduct and Ethics for all of our directors, officers and employees during the fiscal year ended December 31, 2003.  Our Code of Business Conduct and Ethics can be found at our website address:  http://www.fppcorp.com.  We will provide to any person without charge, upon request, a copy of our Code of Business Conduct and Ethics.  Such request should be made in writing and addressed to Investor Relations, FieldPoint Petroleum Corporation, 1703 Edelweiss Drive, Cedar Park, Texas  78613.  Further, our Code of Business Conduct and Ethics is filed as an exhibit to the Companys Annual Report on Form 10-KSB for the fiscal year ending December 31, 2003.  COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT  Section 16 (a) of the Securities Exchange Act of 1934, as amended, requires the Company's executive officers, directors and persons who own more than ten percent of the Common Stock (collectively, "Reporting Persons") to file initial reports of ownership and changes of ownership of the Common Stock with the SEC and the American Stock Exchange. Reporting Persons are required to furnish the Company with copies of all forms that they file under Section 16(a).  Based solely upon our search of publicly available information or information provided to the Company from Reporting Persons, during the two years ended December 31, 2007, the Company is not aware of any failure on the part of any Reporting Persons to timely file reports required pursuant to Section 16(a), except the following during 2006:   Karl Reimers failed to file two reports covering two transactions in a timely manner.   29       ITEM 10     EXECUTIVE COMPENSATION  COMPENSATION DISCUSSION AND ANALYSIS  Introduction.This Compensation Discussion and Analysis (CD&A) provides an overview of the Companys executive compensation program together with a description of the material factors underlying the decisions which resulted in the compensation provided for 2006 to the Companys Chief Executive Officer (CEO) ( the Named Executive Officers or NEOs), as presented in the tables which follow this CD&A. The following discussion and analysis contains statements regarding future individual and Company performance targets and goals. These targets and goals are disclosed in the limited context of the Companys compensation programs and should not be understood to be statements of managements expectations or estimates of financial results or other guidance. The Company specifically cautions investors not to apply these statements to other contexts.  Compensation Committee.The Compensation Committee (the Committee) of the Board of Directors is composed of three non-employee Directors, all of whom are independent under the guidelines of the American Stock Exchange listing standards. The current Committee members are Dan Robinson, Karl Reimers and Mel  Slater. The Committee has responsibility for determining and implementing the Companys philosophy with respect to executive compensation. To implement this philosophy, the Committee oversees the establishment and administration of the Companys executive compensation program.  Compensation Philosophy and Objectives.The guiding principle of the Committees executive compensation philosophy is that the executive compensation program should enable the Company to attract, retain and motivate a team of highly qualified executives who will create long-term value for the Shareholders. To achieve this objective, the Committee has developed an executive compensation program that is ownership-oriented and that rewards the attainment of specific annual, long-term and strategic goals that will result in improvement in total shareholder return. To that end, the Committee believes that the executive compensation program should include both cash and equity-based compensation that rewards specific performance. In addition, the Committee continually monitors the effectiveness of the program to ensure that the compensation provided to executives remains competitive relative to the compensation paid to executives in a peer group comprised of select container industry and other manufacturing companies. The Committee annually evaluates the components of the compensation program as well as the desired mix of compensation among these components. The Committee believes that a substantial portion of the compensation paid to the Companys NEOs should be at risk, contingent on the Companys operating and market performance. Consistent with this philosophy, the Committee will continue to place significant emphasis on stock-based compensation and performance measures, in an effort to more closely align compensation with Shareholder interests and to increase executives focus on the Companys long-term performance.  Committee Process.The Committee meets as often as necessary to perform its duties and responsibilities. The Committee usually meets with the CEO and CFO. In addition, the Committee periodically meets in executive session without management.  The Committees meeting agenda is normally established by the Committee Chairperson in consultation with the CEO and CFO. Committee members receive and review materials in advance of each meeting. Depending on the meetings agenda, such materials may include: financial reports regarding the Companys performance, reports on achievement of individual and corporate objectives, reports detailing executives stock ownership and options, tally sheets setting forth total compensation and information regarding the compensation programs and levels of certain peer group companies.   30        Role of Executive Officers in Compensation Decisions.The Committee makes all compensation decisions for the CEO and the CFO. Decisions regarding the compensation of other employees are made by the CEO and CFO in consultation with the Committee. In this regard, the CEO and CFO provide the Committee evaluations of executive performance, business goals and objectives and recommendations regarding salary levels and equity awards.  Market-Based Compensation Strategy.  The Committee adopted the following market-based compensation strategy:  ·Pay levels are evaluated and calibrated relative to other companies of comparable size operating in the oil and gas exploration business (the Peer Group) as the primary market reference point. In addition, general industry data is reviewed as an additional market reference and to ensure robust competitive data.·Target total direct compensation (target total cash compensation plus the annualized expected value of long-term incentives) levels for NEOs are calibrated relative to the Peer Group.·Base salary and target total cash compensation levels (base salary plus target annual incentive) for NEOs are calibrated to the Peer Group.·The long-term incentive component of the executive compensation program is discretionary and viewed in light of the target total direct compensation level.  The Committee retains discretion, however, to vary compensation above or below the targeted percentile based upon each NEOs experience, responsibilities and performance.  Total Direct Compensation  Our objective is to target total direct compensation, consisting of cash salary, cash bonus and long term equity compensation at levels consistent with the surveyed companies, if specified corporate and business unit performance metrics and individual performance objectives are met. We selected this target for compensation to remain competitive in attracting and retaining talented executives. Many of our competitors are significantly larger and have financial resources greater than our own. The competition for experienced, technically proficient executive talent in the oil and gas industry is currently particularly acute, as companies seek to draw from a limited pool of such executives to explore for and develop hydrocarbons that increasingly are in more remote areas and are technologically more difficult to access.  We structure total direct compensation to the named executive officers so that most of this compensation is delivered in the form of equity awards in order to provide incentives to work toward long-term profitable growth that will enhance stockholder returns. We also structure their cash compensation so that a significant portion is at risk under the cash bonus plan, payable based on corporate, business unit and individual performance. In the following sections, we further detail each component of total direct compensation.  Components of Compensation.For the year ended December 31, 2007, the sole component of compensation for the CEO was base salary. We did not provide additional compensation in the form of annual incentive bonus, long term incentives, retirement benefits, or perquisites.   31       Base Salary.The Company provides the CEO with base salaries to compensate him for services rendered during the year. The Committee believes that competitive salaries must be paid in order to attract and retain high quality executives. The Committee reviews the CEOs  salary at the end of each year, with any adjustments to base salary becoming effective on January 1 of the succeeding year.  In determining base salary level for executive officers, the committee considers the following qualitative and quantitative factors:  job level and responsibilities,relevant experience,individual performance,recent corporate performance, and  We review base salaries annually, but we do not necessarily award salary increases each year. From time to time base salaries may be adjusted other than as a result of an annual review, in order to address competitive pressures or in connection with a promotion.  Base salaries paid to the CEO is deductible for federal income tax purposes except to the extent that the executives aggregate compensation which is subject to Section 162(m) of the Internal Revenue Code (the Code) exceeds $1 million.         The following tables and discussion set forth information with respect to all plan and non-plan compensation awarded to, earned by or paid to the Chief Executive Officer ("CEO"), and the Company's four (4) most highly compensated executive officers other than the CEO, for all services rendered in all capacities to the Company and its subsidiaries for each of the Company's last three (3) completed fiscal years; provided, however, that no disclosure has been made for any executive officer, other than the CEO, whose total annual salary and bonus does not exceed $100,000.    32         SUMMARY COMPENSATION TABLE Name
and
Principal
PositionYearSalary ($)BonusStock
AwardsOptions
AwardsNon equity
Incentive Plan
Compensa
-tionNonqualified
Deferred
Compensation
EarningsAll Other
Compensa-
tionTotalRay D. Reaves, CEO, President2007$192,000$50,000-----$242,000Ray D. Reaves, CEO, President2006$192,000$ 0-----$192,000Ray D. Reaves, CEO, President2005$169,000$ 0-----$169,000  The following table sets forth information concerning unexercised options, stock that has not vested and equity incentive plan awards for each named executive officer outstanding as of the end of the most recently completed fiscal year:  OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE Option AwardsStock AwardsNameNumber of
Securities
Underlying
Unexercised
Options

ExercisableNumber of
Securities
Underlying
Unexercised
Options

UnexercisableEquity
Incentive
Plan
Awards;
Number of
Securities
Underlying
Unexercised
Unearned
OptionsOption
Exercise
PriceOption
Exercise
DateNumber of
Shares or
Units of
Stock That
Have Not
VestedMarket
Value of
Shares of
Units That
Have Not
VestedEquity
Incentive
Plan
Awards;
Number of
Unearned
Shares,
Units or
Other
Rights
That Have
Not
VestedEquity
Incentive
Plan
Awards;
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That Have
Not
VestedRay
Reaves- 0 -- 0 ----- 0 ----   33       The following table sets forth information concerning compensation paid to the Companys directors during the most recently completed fiscal year:  DIRECTOR COMPENSATION TABLE NameFees
Earned
or Paid
in CashStock
AwardsOption
AwardsNon-Equity
Incentive Plan
CompensationNonqualified
Deferred
Compensation
EarningsAll Other
CompensationTotalRoger Bryant$1,0007,020---11,500$19,520Mel Slater$1,0007,020----$8,020Karl Reimers$1,0007,020----$8,020Dan Robinson$1,0007,020----$8,020Debra Funderberg$12,00029,959----$41,959  Option Grants Table  There were no stock option grants for fiscal years ended December 31, 2006 and 2007.  34        ITEM 11SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT  The following table sets forth information with respect to beneficial ownership of our common stock by:  *each person who beneficially owns more than 5% of the common stock;*each of our executive officers named in the Management section;*each of our Directors; and*all executive officers and Directors as a group.  The table shows the number of shares owned as of March 31, 2008 and the percentage of outstanding common stock owned as of March 31, 2008.  Each person has sole voting and investment power with respect to the shares shown, except as noted.  Name and Address
of Beneficial OwnerAmount and Nature
of Beneficial OwnerPercent of ClassRay D. Reaves
1703 Edelweiss Drive
Cedar Park, Texas 786133,000,00033.7%Mel Slater
1703 Edelweiss Drive
Cedar Park, Texas 78613406,0004.6%Roger D. Bryant
1703 Edelweiss Drive
Cedar Park, Texas 7861341,0000.5%Karl W. Reimers
1703 Edelweiss Drive
Cedar Park, Texas 7861366,0000.7%Dan Robinson
1703 Edelweiss Drive
Cedar Park Texas106,0001.2%Debra Funderburg
1703 Edelweiss Drive
Cedar Park Texas16,0000.2%All Officers and Directors
as a Group (6 persons)3,635,00040.8% _____________________________ (1)Unless otherwise stated, address is 1703 Edelweiss Drive, Cedar Park, Texas 78613.  35        (2)Under SEC Rules, we include in the number of shares owned by each person the number of shares issuable under outstanding options or warrants if those options or warrants are exercisable within 60 days of the date of this prospectus.  In calculating percentage ownership, we calculate the ownership of each person who owns exercisable options by adding (i) the number of exercisable options for that person only to (ii) the number of total shares outstanding and dividing that result into (iii) the total number of shares and exercisable options owned by that person.(3)Shares and percentages beneficially owned are based upon 8,910,175 shares outstanding on March 31, 2008.   ITEM 12     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS  The Company leases office space from its majority shareholder. The lease requires monthly payments of $2,500 on a month to month basis. The Company also paid Roger Bryant, a director, $11,500 in consulting fees for services in 2007 and $3,600 during 2006,  ITEM 13     EXHIBITS AND REPORTS ON FORM 8-K  (a)Exhibits3.1Articles of Incorporation (incorporated by reference to Amendment No. 1 to Form S-2 dated August 1, 1980.)3.2(b)Articles of Amendment of Articles of Incorporation, dated December 31, 1997 (incorporated by reference to the Company's 10KSB for the year ended December 31, 1997.)3.3Bylaws (incorporated by reference to Amendment No. 1 to Form S-2 dated August 1, 1980.)4.1Plan of Exchange (incorporated by reference to the Company's definitive proxy statement dated December 8, 1997).4.2Indenture (Term Loan) dated June 21, 1999 by and among the Company and Union Planters Bank4.3Indenture (Term Loan) dated August 18, 1999 by and among the Company and Union Planters Bank10.1Consulting Agreement dated May 9, 2000 between FieldPoint Petroleum Corp. and Parrish Brian & Co. (incorporated by reference to the Company's 10QSB/A for the quarter ended September 30, 2000)10.2Executive Employment Agreement, dated March 28, 2001, by and among FieldPoint Petroleum Corp. and Ray D. Reaves (incorporated by reference to the Company's 10KSB for the year ended December 31, 2000.)  36        10.3Credit Agreement (Revolving Credit Note) dated December 14, 2000 by and among FieldPoint Petroleum Corp. and Union Planters Bank (incorporated by reference to the Company's 10KSB for the year ended December 31, 2000.)10.4Audit Committee Charter adopted by the Company on March 28, 2001(incorporated by reference to the Company's 10KSB for the year ended December 31, 2000.)10.5Consulting Agreement dated November 13, 2001 between FieldPoint Petroleum Corp. and TRG Group LLC. (incorporated by reference to the Company's 10QSB for the quarter ended September 30, 2001)10.7Loan and Security Agreement with CitiBank, N.A., dated October 18, 2006 (incorporated by reference from the Companys current report on Form 8k dated October 18, 2006 as filed with the Commission on October 20, 2006.)10.6Lease Assignment from PXP Gulf Coast, Inc., dated March 11, 2004, incorporated by reference from the Company's Current Report on Form 8-K dated March 11, 2004, as filed with the Commission on March 26, 2004.14.Code of Ethics (incorporated by reference to the Companys Annual Report on Form 10-KSB for the year ended December 31, 2003 as filed with the Commission on April 14, 2004.)31.Certification required by Section 13a-14(a) of the Exchange Act.32.Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(b)Reports on Form 8-KCurrent Report on Form 8-K dated November 9, 2007, Item Nos. 2.02 and 7.01 as filed with the Commission on November 9, 2007.Current Report on Form 8-K dated November 9, 2007, Item Nos. 7.01 and 9.01, as filed with the Commission on November 13, 2007.Current Report on Form 8-K dated November 9, 2007, Item Nos. 7.01 and 9.01 as filed with the Commission on November 13, 2007, and amended on Form 8-K/A as filed with the Commission on November 13, 2007.Current Report on Form 8-K dated December 27, 2007, Item Nos. 2.01 and 9.01, as filed with the Commission on December 27, 2007.   37       ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES  In the last two fiscal years, we have retained Hein & Associates, LLP, ("Hein") as our principal accountants. Hein audited our consolidated financial statements for fiscal 2007 and 2006. We understand the need for our principal accountants to maintain objectivity and independence in their audit of our financial statements. To minimize relationships that could appear to impair the objectivity of our principal accountants, our audit committee has restricted the non-audit services that our principal accountants may provide to us primarily to tax services and audit related services. The board has adopted policies and procedures for pre-approving work performed by our principal accountants.  After careful consideration, the Audit Committee of the Board of Directors has determined that payment of the below audit fees is in conformance with the independent status of the Company's principal independent accountants.  Before engaging the auditors in additional services, the Audit Committee considers how these services will impact the entire engagement and independence factors.  The following is an aggregate of fees billed for each of the last two fiscal years for professional services rendered by our principal accountants: 20072006Audit fees - audit of annual financial statements and review of
financial statements included in our quarterly reports, services
normally provided by the accountant in connection with statutory
and regulatory filings.$     82,600$     59,200Audit-related fees - related to the performance of audit or review
of financial statements not reported under "audit fees" above8,700-Tax fees - tax compliance, tax advice and tax planning17,80010,280All other fees - services provided by our principal accountants
other than those identified aboveTotal fees paid or accrued to our principal accountants$   109,100$     69,480  38        SIGNATURES  In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.   FIELDPOINT PETROLEUM CORPORATION(Registrant)Date: March 31, 2008By:/s/ Ray Reaves   Ray Reaves, President  In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.  By: /s/ Ray Reaves     President, Chief Executive Officer, 
     Director, Chairman, Chief Financial OfficerDate:  March 31, 2008By: /s/ Roger D. Bryant     Roger D Bryant
     DirectorDate:  March 31, 2008By: /s/ Dan Robinson     Dan Robinson
     DirectorDate:  March 31, 2008By: /s/ Karl W. Reimers     Karl W. Reimers 
     DirectorDate:   March 31, 2008By: /s/ Mel Slater     Mel Slater
     DirectorDate:   March 31, 2008By: /s/Debra Funderburg
Debra Funderburg
DirectorDate:   March 31, 2008    39