FORM 10-KSB

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


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

                    For the fiscal year ended December 31, 2004


                         Commission File Number: 0-9500
                                                 ------

                        MOUNTAINS WEST EXPLORATION, INC.
                (Exact of small business issuer in its charter)

New Mexico                                                  0 85-0280415
----------                                                  ------------
(State or other jurisdiction of                            I.R.S. Employer
incorporation or organization)                            identification no.)

7609 Ralston Road                                               80002
(Address of principal executive offices)                       (Zip Code)

Issuer's telephone number, including area code: 303-422-8127

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

$0.001 Par Value Common Stock
-----------------------------
(Title of Class)

Check whether the issuer (1) filed all reports required to be filed by section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X]   No [_]

Check if there is no disclosure of delinquent filers in response
to Item 405 of Regulation S-B is not contained in this form, and
no disclosure will be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X]


<PAGE>



State issuer's revenues for its most recent fiscal year. $86,854

State the  aggregate  market value of the voting  stock held by non-affiliates
computed by reference  to the price at which the stock was sold,  or the average
bid and asked prices of such stock,  as of December 31, 2004. (See definition of
affiliate in Rule 12b-2 of the Exchange  Act).  $1,120,770  (based on a  market
value of $.04 per share on December 31, 2004)

State the number of shares outstanding of each of the issuer's classes of common
equity,  as of the latest  practicable  date:  common  stock,  its only class of
equity securities, as of December 31, 2004 was: 49,990,700.

<PAGE>

PART I                                                                     PAGE

     Item 1.   Description of Business                                         1
     Item 2.   Description of Property                                         4
     Item 3.   Legal Proceedings                                               6
     Item 4.   Submission of Matters to a Vote of Security Holders             6


PART II

     Item 5.   Market for Common Equity and Related Stockholder Matters        6
     Item 6.   Management's Discussion and Analysis or Plan of Operation       8
     Item 7.   Financial Statements                                            9
     Item 8.   Changes in and Disagreements With Accountants on Accounting     9
               and Financial Disclosure
     Item 8a.  Controls and Procedures                                         9


PART III

     Item 9.   Directors, Executive Officers, Promoters and Control Persons;
               Compliance with Section 16(a) of the Exchange Act              10
     Item 10.  Executive Compensation                                         11
     Item 11.  Security Ownership of Certain Beneficial Owners and Management 13
     Item 12.  Certain Relationships and Related Transactions                 14
     Item 13.  Exhibits and Reports on Form 8-K                               14
     Item 14.  Principal Accountant Fees and Services                         15

SIGNATURES                                                                    16




<PAGE>



PART I

Item 1. Description of Business.

The Company

Mountains West Exploration, Inc. (the "Company") was incorporated under the laws
of the State of New Mexico on September 17, 1979.

The Company, is an independent  company engaged in the acquisition,  exploration
and development of coal bed methane leases located in Colorado.

For the past several years,  as resources have  permitted,  the Company has been
increasing its activities and gas production is rising, but it has yet to obtain
significant gas income. Management's time and the limited Company resources have
been used to maintain the properties held, to acquire additional  properties and
to participate to the extent possible in the development of its properties. (See
Properties).

Domestic Exploration and Production

The  Company  owns small  interests  in methane  gas wells in the Raton Basin in
Colorado. These wells are producing from coal bed.

The Company has approximately 4,740 gross  acres of oil and gas leases rights
in South Central Colorado,  located in the southwestern part of the Raton Basin.
Several  Companies  have now drilled and  completed  approximately  58 gas wells
around these leases.

                                       1

<PAGE>



The  Company  does  not  presently  have  the  resources  to  develop  any
properties,  therefore,  a decision will be made whether the properties  will be
held  until  such time that the  Company  has the  necessary  resources  for the
development or whether the properties will be leased or farmed out to others for
development.

Access to all domestic properties in which the Company owns any interest is
readily available from state and county highways and roads on a year round
basis.

MOUNTAINS WEST EXPLORATION, INC. PARTICIPATES AS A MINORITY INTEREST HOLDER
(NON OPERATOR) IN METHANE GAS WELLS LOCATED IN LAS ANIMAS COUNTY, COLORADO AS
FOLLOWS:

OPERATOR-EVERGREEN OPERATING COMPANY (PIONEER)

WELL NAME          %INTEREST  NET WELLS  GROSS ACRES  NET ACRES
---------          ---------  ---------  -----------  ---------

Ozzello (one)       12.5%     12.5%      160          20
Jacks (one)         6.25%     6.25%       80           5
Nicol (four units)
(see * below)        3.5%    14%         640          22.4

TOTAL                         32.75%     880          47.4

* Nicol Lease 640 acres 4 drill units because of irregular shape 7 wells were
drilled.

Bumble Bee 0.875% interest
Colorow    1.762375%
Donohue    0.59314%
Ellen      3.5%
Jerry      1.75%
News Radio 2.6%
Roseanne   3.5%

All of the above wells were drilled by others.

Foreign Exploration.

None

Competitive Factors

The petroleum industry is volatile and highly competitive. Earnings from oil and
gas production are primarily dependent upon

                                       2
<PAGE>




prices of crude oil and natural gas. The costs and prices of crude oil, natural
gas and refined products have fluctuated substantially in recent years, often in
a divergent fashion. Competition exists in every aspect of oil and gas
operations, including the acquisition, exploration, discovery and development of
new oil and gas reserves, as well as purchasing, gathering, transporting,
refining and marketing of crude oil, natural gas and petroleum products.

Many companies and  individuals  are engaged in the oil and gas business in both
the U.S.  and  foreign  markets.  Many such  companies  are very  large and well
established with substantial capabilities and long earnings records. The Company
has, and will continue, to encounter strong competition in acquiring oil and gas
leases,  licenses  and  concessions  from  these  and other  companies.  In most
instances  the Company is not able to compete  with these other more  adequately
capitalized  companies in meeting price,  exploration  and bonding  requirements
established by the land owners or foreign  governments.  The Company has, joined
with better capitalized  operators to participate in the discovery of commercial
quantities of methane gas.

The acquisition, exploration, development, production and sale of oil and gas
interests are subject to many factors which are outside the Company's control.
These factors include worldwide and United States economic conditions, oil
import and export quotas, availability of drilling rigs and pipelines, weather
conditions, supply and price of other fuels, and the regulation of production,
transportation and marketing by both domestic and foreign governmental agencies.
Foreign Governmental preferences for major international oil companies over
small independent companies may also have an adverse effect on the Company's
ability to compete with such major companies, even if it otherwise has the
capital to do so.

Environmental Regulations

On a worldwide basis, environmental laws and regulations vary greatly. In the
United States compliance with State and Federal laws may require significant
capital expenditure and will effect decisions regarding acquisition of certain
properties, methods of production and distribution of the oil and gas and the
Company's earning potential from any property. The managing partner of the PPL
56 Joint Venture has not informed the Partners in the Joint Venture of any
environmental laws, rules or regulations established by Papua New Guinea that
might be expected to have any unusual or adverse impact upon the operations of
the Joint Venture or the production of oil and gas from its license interests.

                                        3
<PAGE>




Governmental Regulations

In the United States,  the production of oil and gas is subject to regulation by
the  various  state  regulatory   authorities.   In  general,  these  regulatory
authorities  are empowered to make and enforce  regulations  to prevent waste of
oil and gas, and to fix  allowable  production  rates for oil and gas within the
limits of maximum rates of production and reasonable  market demands for oil and
gas. In addition,  the Company will be required to comply with spacing and other
conservation  rules of the various  states within which the Company owns oil and
gas leases upon which exploration  activities are conducted.  Also,  leases, the
Company will be required to comply with requirements established for exploration
and  development by the United States  Geological  Survey and the Bureau of Land
Management.

Natural gas production and prices are regulated by the Federal Energy Regulatory
Commission and are subject to the Natural Gas Policy Act. New natural gas, some
onshore gas production and interstate gas were deregulated effective January 1,
1985.

The Company will also be subjected to varying taxes that are or may be
established on producers of oil and gas relating to prices received in excess of
certain established norms.

Personnel.


At year end, the Company has no employees,  but hires  consultants for services.
The  Company  has  retained   the   services  of  outside   parties  for  legal,
lease/revenue   management,   accounting,   drafting,   geological,   and  lease
acquisition  services  to the  extent  that  it has  been  able to  afford  such
expenses.

Item 2. Description of Properties.

Offices.

The Company rented its offices at 134 West Main St., Ste 35, Trinidad, CO 81082,
under a  month-to-month  lease at a monthly  rental of $500 up to year end.  The
suite  consists of  approximately  700 sq. feet,  Approximately  one half of the
space is sublet to another party for a monthly rent of $245.  After year end the
Company sought a new office sharing arrangement to cut costs.

                                       4
<PAGE>

Productive Wells and Acreage.

The following table reflects the approximate total gross and net productive oil
and gas wells and approximate total gross and net developed acreage at December
31, 2004:

Productive Wells


  OPERATOR-EVERGREEN OPERATING COMPANY

WELL NAME          %INTEREST  NET WELLS  GROSS ACRES  NET ACRES
---------          ---------  ---------  -----------  ---------

Ozzello (one)       12.5%     12.5%      160          20
Jacks (one)         6.25%     6.25%       80           5
Nicol (four units)
(see * below)        3.5%    14%         640          22.4

TOTAL                         32.75%     880          47.4

* Nicol Lease 640 acres - 4 drill units because of irregular shape 7 wells were
drilled.

Bumble Bee 0.875% interest
Colorow    1.762375%
Donohue    0.59314%
Ellen      3.5%
Jerry      1.75%
News Radio 2.6%
Roseanne   3.5%

1. Gross well or acres is a well or acre in which a working  interest  is owned.
2. A net  well  or  acre is  deemed  to  exist  when  the sum or the  fractional
ownership  working  interests  in gross  wells or acres  equal one. As a working
interest holder, the Company,  along with other working interest holders,  pay a
pro rata share of 100% of production costs.

Undeveloped Properties

At December 31, 2004 the Company held approximately the following gross and net
undeveloped oil and gas acreage:

Leases                 Gross Acres               Net Acres (1)

New Mexico               4,740                     3,792
Totals

(1) Computed using the Company's net revenue interest. Net Acres include working
interests and overriding royalty interests.

                                       5

<PAGE>
Reserves

The Company has not filed any reports  containing oil or gas reserves  estimates
with any Federal or foreign government or authority or agency within the past 12
months.  The  Company  has not  prepared  or had  prepared  for them any reserve
reports  related to the  properties  discussed  herein because the royalties and
working  interests  are so small as to not warrant  the cost of such  studies or
reports.

Item 3. Legal Proceedings.

There are no legal proceedings now pending to which the company is a party.

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

No matters were submitted to a vote of shareholders during the fourth quarter of
the Company's fiscal year.

                                    PART II

Item 5. Market for Common Equity and Related Stockholder Matters.

The  Company's  common  stock is traded  over-the-counter,  symbol  MWEX.PK  The
Company's common stock is listed by the National Daily Quotation Bureau, Inc. in
its Pink Sheets. The high and low bid prices  available  during each quarter of
2003 and 2004 appear as follows,  however,  much of the "pink sheet"  quotes are
unreliable  as to accuracy of  individual  trades and may not  represent  actual
prices after mark up, mark down, or dealer discounts or commissions.

                              2003                                  2004
                              ----                                  ----
                            Bid Prices                            Bid Prices
                            ----------                            ----------

                        High         Low                        High         Low
                        ----         ---                        ----         ---
1st Quarter           .009          .001       1st Quarter      .012       .001
2nd Quarter           .009          .001       2nd Quarter       .01       .001
3rd Quarter           .009          .001       3rd Quarter      .005       .001
4th Quarter           .002          .001       4th Quarter       .06        .01

There were  approximately  1,896 record holders of the Company's common stock on
March 31, 2005.

                                       6
<PAGE>

There currently is a limited public market for the Company's common stock in the
pink sheets,  and no assurance can be given that a market will develop or that a
shareholder ever will be able to liquidate his investment  without  considerable
delay, if at all. If a market should develop,  the price may be highly volatile.
Unless and until the Company's  common shares are quoted on the NASDAQ system or
listed on a national  securities  exchange,  it is likely that the common shares
will be  defined  as  "penny  stocks"  under  the  Exchange  Act  and SEC  rules
thereunder.  The Exchange Act and penny stock rules generally impose  additional
sales practice and disclosure  requirements upon  broker-dealers  who sell penny
stocks  to  persons  other  than  certain  "accredited   investors"  (generally,
institutions  with assets in excess of $5,000,000 or individuals  with net worth
in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 jointly
with spouse) or in transactions not recommended by the broker-dealer.

For transactions covered by the penny stock rules, the broker-dealer must make a
suitability determination for each purchaser and receive the purchaser's written
agreement prior to the sale. In addition,  the  broker-dealer  must make certain
mandated  disclosures in penny stock transactions,  including the actual sale or
purchase  price and  actual bid and offer  quotations,  the  compensation  to be
received  by the  broker-dealer  and  certain  associated  persons,  and deliver
certain disclosures  required by the SEC. So long as the Company's common shares
are considered "penny stocks",  many brokers will be reluctant or will refuse to
effect  transactions in the Company shares,  and many lending  institutions will
not permit the use of penny stocks as collateral for any loans.

Effective  August  11,  1993,  the  Securities  and  Exchange   Commission  (the
"Commission")  adopted Rule 15g-9,  which established the definition of a "penny
stock," for purposes relevant to the Company,  as any equity security that has a
market price of less than $5.00 per share or with an exercise price of less than
$5.00 per share, subject to certain exceptions.  For any transaction involving a
penny  stock,  unless  exempt,  the rules  require:  (i) that a broker or dealer
approve a person's account for  transactions in penny stocks;  and (ii) that the
broker  or  dealer  receive  from  the  investor  a  written  agreement  to  the
transaction,  setting  forth the  identity and quantity of the penny stock to be
purchased.  In order to approve a person's  account  for  transactions  in penny
stocks,  the  broker  or  dealer  must  (i)  obtain  financial  information  and
investment  experience and objectives of the person;  and (ii) make a reasonable
determination that the transactions in penny stocks are suitable for that person
and that person has sufficient  knowledge and experience in financial matters to
be capable of evaluating the risks of transactions  in penny stocks.  The broker
or dealer must also deliver, prior to any transaction in a penny stock, a
disclosure  schedule  prepared  by the  Commission  relating  to the penny stock
market,  which,  in highlight form, (i) sets forth the basis on which the broker
or dealer made the suitability determination; and (ii) states that the broker or
dealer  received a signed,  written  agreement  from the  investor  prior to the
transaction.  Disclosure  also has to be made  about the risks of  investing  in
penny  stock in both  public  offerings  and in  secondary  trading,  and  about
commissions payable to both the broker-dealer and the registered representative,
current  quotations for the securities and the rights and remedies  available to
an  investor  in cases of fraud in penny stock  transactions.  Finally,  monthly
statements  have to be sent  disclosing  recent price  information for the penny
stock held in the account and information on the limited market in penny stocks.


                                       7

<PAGE>

The Company has never paid dividends on its common stock.

Item 6. Management's Discussion and Analysis or Plan of Operation

Results of Operations

The company had revenues from gas  production of $163,801 in 2004 and $86,854 in
2003. The company incurred  operating  expenses of $1158,123 in 2004 and $99,465
in  2003.  The  substantial  increase  in  expenses  in 2004  was due to  higher
consulting fees over 2003. The largest components of expense were as follows.


                          2004            2003
                          ----            ----
Depreciation               432            2,237
Moving Expense               -           15,732
Consulting              86,377           64,834
Legal and Accounting    55,760            7,771
Mineral rights               -                -
Rent                     6,000            1,600
Transfer Agent           2,750            4,000
Travel                   2,949            3,797

The net profit was $1,433 for 2004 compared to a loss of ($16,483) for 2003 even
though revenues increased,  expenses also increased.  The net loss per share was
nominal in each year.

The Company believes that the trend toward profiability is only temporary basd
on its past experiance in the energy business.

Liquidity and Capital Resources

During the year, the company had increased revenue,  and a marginally  increased
cash position,  which was insufficient for any significant  operations expansion
The company had cash of $30,637 and illiquid assets of $17,055 approximately, at
year end.

The company's only capital  resources are its cash assets which may be illiquid,
and its common stock which might be sold to raise capital.

Changes in Financial Condition

Year to date  the  Company  experienced  an  increase  in cash  position  due to
increased  revenue  of the  Company  and a  capital  infusion  of  $25,000.  The
Company's  total debt  increased to  approximately  $78,000 during the year as a
result of expense  accruals.  The Company's total  liabilities are approximately
$78,089 at year end.


NEED FOR ADDITIONAL FINANCING

     The Company may not have capital  sufficient  to meet the  Company's  cash
needs,   including  the  costs  of  compliance  with  the  continuing  reporting
requirements  of the  Securities  Exchange Act of 1934. The Company may have to
seek  loans or equity  placements  to cover  such cash  needs.  Lack of
its  existing  capital  may  be a  sufficient  impediment  to  prevent  it  from
accomplishing  the  goal of  expanding its operations.  There  is no
assurance,  however,  that without funds it will ultimately  allow company to
carry out its business.

                                       8
<PAGE>

The  Company  will  need to raise  additional  funds  to  expand  its  business
activities in the next twelve months.

         No commitments to provide additional funds have been made by management
or  other  stockholders.  Accordingly,  there  can  be  no  assurance  that  any
additional  funds  will be  available  to the  Company  to allow it to cover its
expenses as they may be incurred.

         Irrespective   of  whether  the  Company's  cash  assets  prove  to  be
inadequate to meet the Company's  operational  needs,  the Company might seek to
compensate providers of services by issuances of stock in lieu of cash.

GOING CONCERN

     The Company's auditor has issued a "going concern" qualification as part of
his opinion in the Audit Report. There is substantial doubt about the ability of
the  Company to  continue as a "going  concern."  The  Company has no  business,
limited capital, debt in excess of $78,089, $53,605 of which is current, $30,637
in cash, minimal other liquid assets, and no capital commitments. The effects of
such conditions could easily be to cause the Company's bankruptcy.

     Management  hopes  to  seek  and  obtain  funding,  via  loans  or  private
placements  of stock  for  operations,  debt  and to  provide  working  capital.
Management  has  plans to seek  capital  in the  form of loans or stock  private
placements in the next year of approximately $250,000.


Item 7. Financial Statements.

Item  8.  Changes  in and  Disagreements  With  Accountants  on  Accounting  and
Financial Disclosure.

No principal independent accountant resigned (or declined to stand for
re-election) or was dismissed during the Company's two most recent fiscal years
or any later interim period.

Item 8a. Controls and Procedures

Evaluation of Internal and Disclosure Controls
----------------------------------------------

     The  management  of the  company has  evaluated  the  effectiveness  of the
issuer's disclosure controls and procedures as of the end of the period for this
report  (evaluation  date) and have concluded  that the disclosure  controls and
procedures  are adequate and  effective  based upon their  evaluation  as of the
evaluation date.

     There were no significant  changes in internal controls or in other factors
that could  significantly  affect internal controls subsequent to the evaluation
date,  including any corrective actions with regard to significant  deficiencies
and material weaknesses.

                                       9
<PAGE>

                                    PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
with Section 16(a) of the Exchange Act.

The following individuals are the Company's directors and executive officers as
of date of filing of this report.

Name                             Age               Positions held with Company

Denis Iler                       65                Director, President and
                                                   Treasurer
Redgie Green                     51                Secretary and  Director

Background information about each director and executive officer is as follows:

DENIS R. ILER, age 65, President,  CFO and Director,  received a BA in Math from
San Jose State  University in  California,  and an MBA from Regis  University in
1982. He was a comptroller with Berge Exploration from 1978 to 1984. Since 1984,
he has been President and principal  accountant for Business  Financial Systems,
Inc., an independent  accounting firm, providing tax and accounting services for
the small  business  community,  including oil and gas,  construction,  and real
estate brokerage accounting.  He was a director of NELX, Inc. from 1999-2001. He
was elected Director and appointed  President of Jagged Edge Mountain Gear, Inc.
in 2004. He was President and Director of Cheyenne Resources,  Inc. from January
to August, 2004.

REDGIE GREEN, age 51,  Secretary,  Treasurer and Director,  (elected in March of
2005) has been Secretary and Director of Dynadapt Systems,  Inc. since 1998. Mr.
Green has been  co-owner  and operator of Green's B&R  Enterprises,  a wholesale
donut  baker  since 1983.  He has been an active  investor in small  capital and
high-tech  adventures  since 1987.  Mr. Green was a director of Colorado  Gold &
Silver,  Inc. in 2000. He was a director for Houston  Operating  Company in late
2004 until December 2004. He was elected a director of Mind2Market, Inc. in late
2004.


No director, officer or beneficial owner of more than 10% of the Company's
common stock, its only equity securities, or any other person subject to Section
16 of the Exchange Act failed to file reports required by Section I 6(a) of the
Exchange Act during the most recent fiscal year or prior fiscal years.

There are no family relationships among the members of the Board of Directors
and Management.

                                       10
<PAGE>

Item 10. Executive Compensation.

The following table sets forth certain information concerning the remuneration
paid by the Company for the fiscal year ended December 31, 2004, for each
officer and director.
<TABLE>
<CAPTION>

SUMMARY COMPENSATION TABLE OF EXECUTIVES AND DIRECTORS

<S>                         <C>        <C>            <C>          <C>                   <C>              <C>
                            Fiscal     Annual Compensation     Awards
Name & Principal            Year       Salary         Bonus        Other Annual          Restricted       Securities
Position                               ($)            ($)          Compensation          Stock            Underlying
                                                                   ($)                   Award(s)         Options/
                                                                                         ($)              SARS (#)
- ---------------------------------------------------------------------------------------------------------------------


Robert Doak,                2004       $86,337        0            0                     0                0
President/ CEO              2003       $64,834 (2)    0            0                     0                0
& Director                  2002       $12,000        0            0                     0                0
(Resigned in 2004)

David Shier,                2004       $0             0            0                     0                0
Secretary & Director        2003       $0             0            0                     0                0
(Resigned in 2004           2002       $0             0            0                     0                0

Denis Iler,                 2004       $0             0            0                     0                0
President/CFO               2003       $0             0            0                     0                0
Director                    2002       $0             0            0                     0                0

Redgie Green                2004       $0             0            0                     0                0
Secretary & Treasure
Director as of 1/1/05

All Officers &              2004       $86,337        0            0                     0                0
Directors as a group (2)    2003       $86,337        0            0                     0                0
                            2002       $12,000        0            0                     0                0
</TABLE>

(1) Directors are to be paid $300 per meeting attended by such director.

     Other than the remuneration discussed above, the Company has no retirement,
pension,  profit sharing, stock option or similar program for the benefit of its
officers, Directors or employees, nor does it have a Long Term Incentive
Programs.

(2) Consulting fees.

                                       11
<PAGE>

Audit Committee
---------------
     The company does not have an Audit Committee.  The members of the Board sit
as the Audit Committee.  No qualified financial expert has bee hired because the
company is to small to afford such expense.

Code of Ethics
--------------

     The company has adopted a Code of Ethics for the Board and employees.

 Committees and Procedures
--------------------------

     (1)  The registrant  has no standing  audit,  nominating  and  compensation
          committees of the Board of Directors, or committees performing similar
          functions.  The Board  acts  itself in lieu of  committees  due to its
          small size.

     (2)  The view of the board of directors is that it is  appropriate  for the
          registrant  not  to  have  such  a  committee  because  all  directors
          participate in the consideration of director nominees and the board is
          so small.

     (3)  Each of the members of the Board which acts as nominating committee is
          not  independent,  pursuant to the  definition  of  independence  of a
          national  securities  exchange  registered pursuant to section 6(a) of
          the Act (15 U.S.C. 78f(a).

     (4)  The   nominating   committee   has  no  policy   with  regard  to  the
          consideration  of any  director  candidates  recommended  by  security
          holders,   but  the  committee  will  consider   director   candidates
          recommended by security holders;

                                       12
<PAGE>

     (5)  The  basis  for  the  view  of  the  board  of  directors  that  it is
          appropriate  for the  registrant  not to have  such a  policy  is that
          there is no need to adopt a policy for a small company.

     (6)  The  nominating  committee  will consider  candidates  recommended  by
          security   holders,   and  by  security  holders  in  submitting  such
          recommendations; should provide a completed Directors Questionnaire to
          the company

     (7)  There are no  specific,  minimum  qualifications  that the  nominating
          committee  believes must be met by a nominee  recommended  by security
          holders except to find anyone willing to serve with clean  background.
          There  are no  differences  in the  manner  in  which  the  nominating
          committee evaluates nominees for director based on whether the nominee
          is recommended by a security holder, or found by the board.

     (8)  The  nominating  committee's  process for  identifying  and evaluation
          nominees for  director,  including  nominees  recommended  by security
          holders,  is to find  anyone  willing to serve with clean  background.
          There  are no  differences  in the  manner  in  which  the  nominating
          committee evaluates nominees for director based on whether the nominee
          is recommended by a security holder, or found by the board.




Item 11. Security Ownership of Certain Beneficial Owners and Management

The  following  table sets  forth,  as of  December  31,  2004,  the  beneficial
ownership  of Common  Stock by each  person  who is known by the  Company to own
beneficially  more than 5% of the issued and  outstanding  Common  Stock and the
shares of Common Stock owned by each officer and Director.  Each person has sole
voting and investment power as to all shares unless otherwise indicated.

                                       13

<PAGE>

Directors.

                      (2)                   (3)

  (1)              Name and address    Amount and nature                (4)
Title of                   of                of                        Percent
Class              Beneficial owner    Beneficial ownership            of class
-----              ----------------    --------------------            --------

$.001 par value    Denis Iler               21,980,429(1)                43.96%
common stock       2000 Wadsworth Blvd       direct
                   PMB 179
                   Lakewood, CO 80214

$0.001 par value   Redgie Green                  0 (2)                      0%
common stock       259 N. Commercial St.      direct
                   Trinidad, Colorado 81082

All Directors and officers as a group
(1) (2) (3) (4)                              21,980,429                  43.96%



Item 12. Certain Relationships and Related Transactions.

The company paid Robert Doak $86,337 in consulting fees for his services in
2004.  Further Mr. Doak retains a 5% royalty on 4,740 acres of coal bed methane
leases owned by the company.  Mr. Doak was President and a Director until
November 3, 2004.

Skye Blue Ventures LLC, in November 2004, purchased 9,000,000 shares from Robert
Doak and also purchased 12,980,429 shares from the Company for $25,000.

Item 13. Exhibits and Reports on Form 8-K.

(a)  Documents filed as a part of this report:
     -----------------------------------------

         (1) Financial Statements.

         Independent Auditors' report
         Balance Sheets at December 31, 2004 and 2003.
         Statements of Operations for the years ended December 31, 2004 and
         2003. Statements of Stockholders' Equity for the years ended December
         31, 2004 and 2003.

                                       14
<PAGE>


         Statements of Cash Flows for the years ended December 31,
         2004 and 2003.
         Notes to Financial Statements at December 31, 2004 and 2003.


(b)  Reports on Form 8-K:
     --------------------

The Registrant filed  reports on Form 8-K during the last quarter of the
period covered by this Report as follows:

8-K November 8, 2004

(1)  The Registrant's Articles of Incorporation and Bylaws are
incorporated herein by reference to SEC file No. 2-69024, filed
September 2, 1980.

There are no other exhibits specified in Item 601 of Regulation S-B to be
included with this filing.

Item 14. Principal Accountant Fees and Services

General.  Michael Johnson & Co., LLC, CPAs ("MJC") is the Company's principal
auditing accountant firm. The Company's Board of Directors has considered
whether the provisions of audit services is compatible with maintaining MJC's
independence.

     Audit Fees.  MJC billed the Company  $6,000 for the following  professional
services:  audit of the annual financial statement of the Company for the fiscal
year ended  December 31, 2004,  and review of the interim  financial  statements
included in  quarterly  reports on Form  10-QSB for the periods  ended March 31,
2004,  June 30, 2004 and September 30, 2004.  MJC billed the Company  $5,000 for
the 2003 audit and $4,000 for the 2004 Audit.

     There were no audit related fees in 2004 or 2003. There were no tax fees or
other fees in 2004 or 2003 paid to Auditors or Auditors affiliates.

     The Company's  Board acts as the audit  committee and had no  "pre-approval
policies and  procedures"  in effect for the auditors'  engagement for the audit
year 2004 and 2003.

     All audit work was performed by the auditors' full time employees.

                                       15

<PAGE>


                              SIGNATURES

     Pursuant  to the  requirements  of Section  13 or 15 (d) of the  Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                        MOUNTAINS WEST EXPLORATION, INC.

Date: April 13, 2005

/s/Denis Iler
----------------------
Denis Iler, President and Chief
Executive Officer and
Chief Financial Officer

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.

Date: April 13, 2005

/s/Denis Iler
-----------------------
Denis Iler, Director

Date: April 13, 2005

/s/Redgie Green
-----------------------
Redgie Green, Director

                                       16

<PAGE>

                        MOUNTAINS WEST EXPLORATION, INC.
                          INDEX OF FINANCIAL STATEMENTS



                                                                          Pages

Auditors Report                                                              F-1

Balance Sheets                                                               F-2

Statements of Operations                                                     F-3

Statements of Changes in Stockholders Deficit                                F-4

Statements of Cash Flows                                                     F-5

Notes to Financial Statements                                         F-6 - F-10

<PAGE>



                        MOUNTAINS WEST EXPLORATION, INC.

                              FINANCIAL STATEMENTS
                 For the Years Ended December 31, 2004 and 2003





<PAGE>



                           MICHAEL JOHNSON & CO., LLC
                          Certified Public Accountants
                        9175 East Kenyon Ave., Suite 100
                             Denver, Colorado 80237

Michael B. Johnson C.P.A.                             Telephone:  (303) 796-0099
Member:  A.I.C.P.A.                                         Fax:  (303) 796-0137
Colorado Society of C.P.A.s



                          INDEPENDENT AUDITOR'S REPORT


Board of Directors
Mountains West Exploration, Inc.
Trinidad, CO  81082


We have audited the accompanying balance sheets of Mountains West Exploration,
Inc. as of December 31, 2004 and 2003 and the related statements of operations,
stockholders' equity, and cash flows for the year ended December 31, 2003 and
2004. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit "in accordance with standards of the Public Company
Accounting Oversight Board (United States)" as outlined in PCAOB Auditing
Standard No. 1. Those standards require that we plan and perform the audits 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 audit provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Mountains West Exploration,
Inc. as of December 31, 2004 and 2003, and the results of their operations and
their cash flows for the years ended December 31, 2004 and 2003, in conformity
with accounting principles generally accepted in the United States.

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 4, conditions exist which
raised substantial doubt about the Company's ability to continue as a going
concern unless it is able to generate sufficient cash flows to meet its
obligations and sustain its operations. Management's plans in regard to these
matters are also described in Note 4. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.



Michael Johnson & Co., LLC
Denver, Colorado
February 16, 2005

/s/Michael Johnson & Co., LLC

                                      F-1
<PAGE>
<TABLE>
<CAPTION>


                        MOUNTAINS WEST EXPLORATION, INC.
                                 Balance Sheets
                                  December 31,
<S>                                                                             <C>                       <C>

                                                                                      2004                      2003
                                                                                      ----                      ----
ASSETS:
Current assets:
   Cash                                                                                 $ 30,637                  $ 11,711
                                                                                -----------------         -----------------

      Total current assets                                                                30,637                    11,711
                                                                                -----------------         -----------------

Fixed assets:

   Office Equipment                                                                       15,819                    15,819
   Lease & Well Equipment                                                                  1,236                     1,236
                                                                                -----------------         -----------------
                                                                                          17,055                    17,055
      Less: Accumulated Depreciation                                                     (14,685)                  (14,253)
                                                                                -----------------         -----------------

         Total fixed assets                                                                2,370                     2,802
                                                                                -----------------         -----------------

Other Assets:
   Undeveloped Property                                                                    1,540                     1,540
   Well Leases                                                                            17,768                         -
   Mineral Interest                                                                       12,740                    12,740
                                                                                -----------------         -----------------

      Total other assets                                                                  32,048                    14,280
                                                                                -----------------         -----------------

TOTAL ASSETS                                                                            $ 65,055                  $ 28,793
                                                                                =================         =================


LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
   Accounts Payable                                                                     $ 34,861                       $ -
   Current Portion - Long-Term Debt                                                       18,744                    18,744
                                                                                -----------------         -----------------

      Total current liabilities                                                           53,605                    18,744
                                                                                -----------------         -----------------

Long-Term Debt:
    Long-Term Debt                                                                        24,484                    49,516
                                                                                -----------------         -----------------

        Total long-term debt                                                              24,484                    49,516
                                                                                -----------------         -----------------

Stockholders' equity:
Common Stock, no par value; 50,000,000 shares authorized;
    49,999,700 shares issued and outstanding in 2004                                   1,579,786                 1,554,786
    37,019,271 shares issued and outstanding in 2003.
   Retained Earnings (Deficit)                                                        (1,592,820)               (1,594,253)
                                                                                -----------------         -----------------

       Total stockholders' equity (deficit)                                              (13,034)                  (39,467)
                                                                                -----------------         -----------------

TOTAL LIABILITIES AND STOCKHOLDERS EQUITY                                               $ 65,055                  $ 28,793
                                                                                =================         =================
</TABLE>
The accompanying notes are an integral part of these financial statements.

                                      F-2
<PAGE>
<TABLE>
<CAPTION>


                        MOUNTAINS WEST EXPLORATION, INC.
                            Statements of Operations


<S>                                        <C>                    <C>


                                                       Year Ended
                                                       December 31,

                                                2004                   2003
                                           ---------------        ---------------

Revenue
   Oil & Gas Income                             $ 163,801               $ 86,854
                                           ---------------        ---------------

       Net Income                                 163,801                 86,854
                                           ---------------        ---------------
Expenses:
   Bank Charges                                        38                      4
   Consulting                                      86,337                 64,834
   Depreciation                                       432                  2,337
   Dues & Subscriptions                               367                    240
   Legal and Accounting                            55,760                  3,753
   Maintenance                                          -                      -
   Meals & Entertainment                              185                    122
   Moving Expense                                       -                 15,732
   Office Expenses                                    563                  1,492
   Penalties                                            -                      -
   Postage                                            444                    347
   Rent                                             6,000                  1,600
   Taxes                                              571                    117
   Telephone                                        1,482                    840
   Transfer Agent Expense                           2,750                  4,000
   Travel                                           2,949                  3,797
   Vehicle Expense                                    245                    250
                                           ---------------        ---------------

Total Expenses                                    158,123                 99,465
                                           ---------------        ---------------

Other Income and Expense
   Interest Expense                                 4,245                  3,872
   Interest Income                                      -                      -
                                           ---------------        ---------------

Total Other Income & Expense                        4,245                  3,872
                                           ---------------        ---------------

Net Profit (Loss)                                 $ 1,433              $ (16,483)
                                           ===============        ===============

Per Share Information:

   Weighted average number of
     common shares outstanding                 38,100,998             37,019,271
                                           ---------------        ---------------

Net Loss per Common Share                        *                      *
                                           ===============        ===============


* Less than $.01

</TABLE>
The accompanying notes are an integral part of these financial statements.

                                      F-3
<PAGE>
<TABLE>
<CAPTION>

                        MOUNTAINS WEST EXPLORATION, INC.
                         Stockholders' Equity (Deficit)
                               December 31, 2004



<S>                                                           <C>                  <C>               <C>                 <C>
                                                                                                         Retained
                                                                Common Stock                            (Deficit)
                                                                # of Shares            Amount            Earnings             Totals
                                                                -----------            ------            --------             ------

Balance - December 31, 2000                                         38,010,000         $1,555,777         $(1,546,201)      $ 9,576

Cancelation of stocks                                                 (990,729)              (991)                  -          (991)
Net Loss for year                                                            -                  -             (27,475)      (27,475)
                                                              -----------------    ---------------   -----------------   -----------
Balance - December 31, 2001                                         37,019,271          1,554,786          (1,573,676)      (18,890)
                                                              -----------------    ---------------   -----------------   -----------

Net Loss for year                                                            -                  -              (4,094)       (4,094)
                                                              -----------------    ---------------   -----------------   -----------

Balance - December 31, 2002                                         37,019,271          1,554,786          (1,577,770)      (22,984)
                                                              -----------------    ---------------   -----------------   -----------

Net Loss for year                                                            -                  -             (16,483)      (16,483)
                                                              -----------------    ---------------   -----------------   -----------

Balance - December 31, 2003                                         37,019,271          1,554,786          (1,594,253)      (39,467)
                                                              -----------------    ---------------   -----------------   -----------

Issuance of stock for cash                                          12,980,429             25,000                   -        25,000
Net Profit for the Year                                                      -                  -               1,433         1,433
                                                              -----------------    ---------------   -----------------   -----------
Balance - December 31, 2004                                         49,999,700         $1,579,786         $(1,592,820)    $ (13,034)
                                                              =================    ===============   =================   ===========

</TABLE>
The accompanying notes are an integral part of these financial statements.

                                      F-4
<PAGE>
<TABLE>
<CAPTION>


                          MOUNTAINS EXPLORATION, INC.
                            Statements of Cash Flows
                               (Indirect Method)



                                                                                      Year Ended
                                                                                      December 31,
<S>                                                                 <C>                      <C>

                                                                              2004                    2003
                                                                             ----                    ----

Cash Flows from Operating Activities:

Net Profit (Loss)                                                            $ 1,433               $ (16,483)

   Depreciation                                                                  432                     270
   Increase (Decrease) in Accounts Payable                                    34,861                  (5,000)
                                                                    -----------------        ----------------
Net Cash Flows Used by Operations                                             36,726                 (21,213)
                                                                    -----------------        ----------------
Cash Flows from Investing Activities:

   Purchase of Equipment & Leases                                            (17,768)                 (1,949)
                                                                    -----------------        ----------------
Cash Flows Used by Investing Activities                                      (17,768)                 (1,949)
                                                                    -----------------        ----------------
Cash Flows from Financing Activities:
    Payment to Notes Payable                                                 (25,032)                      -
    Issuance of Common Stock                                                  25,000
    Proceeds from Notes Payable                                                    -                  33,260
                                                                    -----------------        ----------------
Net Cash Flows Provided by Financing Activities                                  (32)                 33,260
                                                                    -----------------        ----------------

Net Increase (Decrease) in Cash                                               18,926                  10,098
                                                                    -----------------        ----------------

Cash at Beginning of Period                                                   11,711                   1,613
                                                                    -----------------        ----------------

Cash at End of Period                                                       $ 30,637                $ 11,711
                                                                    =================        ================

Supplemental Disclosure of Cash Flow Information
   Cash paid for Interest                                                    $ 4,245                 $ 3,872
                                                                    =================        ================
   Cash paid for income taxes                                                    $ -                     $ -
                                                                    =================        ================

</TABLE>
The accompanying notes are an integral part of these financial statements.
n
                                      F-5
<PAGE>


                        MOUNTAINS WEST EXPLORATION, INC.
                          Notes to Financial Statements
                                December 31, 2004


Note 1 - Organization and Summary of Significant Accounting Policies:
         ------------------------------------------------------------

Organization:

Mountain West Exploration, Inc. (MWEX) was incorporated in the state of New
Mexico. It is primarily organized for the purpose of acquiring interests in
undeveloped oil and gas and mineral leases, reselling all or part of its
interest in these leases to other companies in the oil and gas industry and
engaging in other oil and gas activities. The Company's fiscal year end is
December 31.

Basis of Accounting:

The accompanying financial statements have been prepared on the accrual basis of
accounting in accordance with accounting principles generally accepted in the
United States.

Cash and Cash Equivalents:

The Company considers all highly liquid debt instruments, purchased with an
original maturity of three months or less, to be cash equivalents.

Use of Estimates:

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

Net Earnings (Loss) Per Share:

Net loss per share is based on the weighted average number of common shares and
common shares equivalents outstanding during the period.

Furniture and Equipment:

Furniture and equipment are capitalized at acquisition cost and depreciated
utilizing the straight-line method over its estimated life of five years.
Maintenance, repairs and minor renewals are charged to operations as incurred.
Major renewals and betterments which substantially extend the useful life of the
property and equipment are capitalized.

                                      F-6
<PAGE>





                        MOUNTAINS WEST EXPLORATION, INC.
                          Notes to Financial Statements
                                December 31, 2004


Oil and Gas Properties:

MWEX uses the successful efforts method of accounting for oil and gas producing
activities. Costs to acquire interests in oil and gas properties, to drill and
equip exploratory wells that find proved reserves, and to drill and equip
development wells are capitalized. Costs to drill exploratory wells that do not
find proved reserves, geological and geophysical costs, and costs of carrying
and retaining unproved properties are expensed.

Unproved oil and 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. Other unproved
properties are amortized based on MWEX's experience of successful drilling and
average holding period. Capitalized costs of producing oil and gas properties,
after considering estimated dismantlement and abandonment costs and estimated
salvage values, are depreciated and depleted by the unit-of-production method.

Other Comprehensive Income:

The Company has no material components of other comprehensive income (loss), and
accordingly, net loss is equal to comprehensive loss in all periods.

Revenue Recognition on Sale of Oil and Gas Leases:

Sale of interests in undeveloped oil and gas leases are accounted for utilizing
the cost recovery method. Accordingly, the financial reporting, purposes, gain
on sales of interests in such leases is recognized only to the extent that total
proceeds of the sale exceed MWEX's original cost in the leases. Gain is not
recognized on sales in which a substantial obligation for future performance
exists.

Note 2 - Federal Income Taxes:

The Financial Accounting Standards Board (FASB) has issued Statement of
Financial Accounting Standards Number 109 ("SFAS 109"). "Accounting for Income
Taxes", which requires a change from the deferred method to the asset and
liability method of accounting for income taxes. Under the asset and liability
method, deferred income taxes are recognized for the tax consequences of
"temporary differences" by applying enacted statutory tax rates applicable to
future years to differences between the financial statement carrying amounts and
the tax basis of existing assets and liabilities.

                                      F-7
<PAGE>





                        MOUNTAINS WEST EXPLORATION, INC.
                          Notes to Financial Statements
                                December 31, 2004

Note 2 - Federal Income Taxes (Cont):
                       December 31, 2004 December 31, 2003
Deferred tax assets
         Net operating loss carryforwards         $ 1,578,135   $  1,608,506
         Accumulated Depreciation                      14,685         14,253
         Valuation allowance                       (1,592,820)    (1,594,253)
                                                 --------------  ------------
         Net deferred tax assets                   $         0  $          0
                                                 =============== ============

At December 31, 2004, the Company had net operating loss carryforwards of
approximately $1,557,959 for federal income tax purposes. These carryforwards if
not utilized to offset taxable income will begin to expire in 2011.

Note 3 - Notes Payable:

Following is the summary of Notes Payable at December 31, 2004:

         Bank of America - A ten-year loan at 5% interest per annum
         secured by miscellaneous holdings.                            $17,071

         Wells Fargo - A four-year loan at 8% interest per
         annum secured by miscellaneous holdings                        26,157
                                                                       --------
                           Total Notes Payable                         $43,228
                           Less:  Current Portion                      (18,744)
                                                                       ---------
                           Long-Term Portion                           $24,484
                                                                       ========

Note 4 - Going Concern:

The Company's financial statements have been presented on the basis that it is a
going concern.

The Company's ability to continue as a going concern is dependent upon its
ability to develop additional sources of capital and achieve profitable
operations. There is insufficient cash on hand to support current or anticipated
operations. The accompanying financial statements do not include any adjustments
that might result from the outcome of these uncertainties. Management is seeking
new capital to revitalize the Company.

Note 5 - Capital Stock Transactions:

The authorized capital stock of the Company was established at 50,000,000 with
no par value. There were 12,980,429 shares of common stock issued in December
2004.

Note 6 - Segment Information

Mountains West Exploration operates primarily in a single operating segment,
acquiring interests in unproved oil, gas and mineral leases and engaging in
other oil and gas activities

                                      F-8