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

FORM 10-KSB
[X]  Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

FOR THE YEAR ENDED DECEMBER 31, 2002
Commission File Number 0-32129

Energy and Engine Technology Corporation
---------------------------------------------
(Exact name of registrant as specified in its charter)

Nevada                              88-0471842
----------------------------        ----------
(State or other jurisdiction of    (I.R.S. Employer
incorporation or organization)   Identification No.)

5308 West Plano Parkway
Plano, Texas                                   75093
---------------------------------------     -----------
(Address of principal executive offices)    (Zip Code)

Registrant's telephone number, including area code:
(972) 732-6360

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

Securities registered pursuant to Section 12(g) of the Act: Common Stock,
par value $.001 per share

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months, and (2) has been subject to such
filing requirements for the past 90 days.  YES: [X] NO: [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-B is not contained herein, and will not 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]

The number of shares outstanding of the Registrant's common stock as of
April 9, 2003 was 25,518,532 shares.

Registrant had revenues for its year ended December 31, 2002 of $99,257.

Registrant's common stock is listed and trading on the OTCBB under the symbol
"EENT". The aggregate market value of the voting stock held by non-affiliates
of Registrant as of April 7, 2003 was $675,603.06. This calculation does not
reflect a determination that persons are affiliates for any other purposes.

DOCUMENTS INCORPORATED BY REFERENCE

None.

Transitional Small Business Disclosure Format (Check one):  Yes ; No X

                                  1

Forward-Looking Statements
--------------------------
In addition to historical information, this Annual Report contains forward-
looking statements. These forward-looking statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from those reflected in these forward-looking statements. Factors that might
cause such a difference include, but are not limited to, those discussed in
the section entitled Management's Discussion and Analysis of Financial
Position and Results of Operations.  Readers are cautioned not to place undue
reliance on these forward-looking statements, which reflect management's
opinions only as of the date hereof. Registrant undertakes no obligation to
revise or publicly release the results of any revision to these forward-
looking statements. Readers should carefully review the risk factors
described in other documents the Registrant files from time to time with the
Securities and Exchange Commission, including the Quarterly Reports on Form
10-QSB to be filed by the Registrant in the year 2003.


                               PART I

ITEM 1.  DESCRIPTION OF BUSINESS

Energy & Engine Technology Corporation ("Registrant" or the "Company") was
formed in the State of Nevada on November 16, 1999 under the name Bidder
Communications, Inc. On December 5, 2001, Registrant filed an Amendment to
its Articles of Incorporation, changing the name of the corporation to
Energy & Engine Technology Corporation.

On August 29, 2001, the Board of Directors and stockholders of Registrant
voted to acquire Southern States Gas Gathering, LLC, ("SSGG"), a Louisiana
limited liability company, whose business was stated as the proposed
operation of a 65-mile gas gathering system in Louisiana. After careful
consideration, Registrant's Board of Directors and stockholders,
representing 68% of the authorized, issued and outstanding common stock
determined that the transaction described in the Purchase and Sale
Agreement (Exhibit 99(a) to the Form 8-K, filed August 29, 2001, under
SEC File No. 0-32129 and incorporated herein by reference ("P&S Agreement"))
was in the best interests of the stockholders of registrant and approved
the resolution. Under the terms of the Purchase and Sale Agreement, a total
of 3,827,621 shares of the authorized, but unissued common stock of
Registrant, as well as $150,000 in cash, were exchanged for 100% of the
membership interests in SSGG. In addition, the Board of Directors appointed
Willard G. McAndrew, III and Roger Wurtele as directors, and Willard G.
McAndrew, III as Chairman of the Board of Directors, until the next annual
stockholders meeting. The closing of the acquisition occurred on September 7,
2001.  As a result of this acquisition, during the fourth quarter of 2001,
there was a transition period during which former management and directors of
Bidder resigned, and Wurtele and McAndrew assumed management of Registrant.

On September 7, 2001, the Company acquired 100% of the membership interests
in Southern States Gas Gathering, LLC ("SSGG") for $153,828 in cash and
common stock, which was recorded as an acquisition of assets.  The assets
acquired consisted primarily of an inactive 65 mile gas gathering system
located in the Caddo Pine Island Field, Louisiana.  Trailblazer Production
Company, LLC ("Trailblazer"), acting as agent for Mees Pierson Unlimited
("Seller"), was an unrelated party at the time of the acquisition, and



                                  2

received $50,000 plus common stock from the total purchase price for
services rendered.  As noted in Item 12 to Registrant's 2002 Form 10-KSB,
at the time of the acquisition, Trailblazer (now inactive) was owned by
Registrant's Chief Executive Officer and Chief Financial Officer.

As part of the acquisition, pursuant to the Purchase and Sale Agreement,
(Exhibit 99(a) to the Registrant's From 8-K, filed August 29, 2001 (the
"P&S Agreement"), the Company had also acquired from Seller (through its
agent, Trailblazer), GlobalSat Technology data.  In exchange for this data,
the Company issued Trailblazer and Seller an option to acquire up to 25% of
its interest in SSGG (the "Option") which the Company deemed to have a
nominal value.   The Seller and Trailblazer had also retained a 6% royalty
on gross income of SSGG (the "Royalty").  The Company also agreed that
Trailblazer's and the Seller's ownership in the Company would not dilute for
2 years ("Non Dilution Agreement").  On August 5, 2002, the Agreement was
amended as follows: 1)  The GlobalSat Technology was returned to the Seller
in exchange for the termination of the Option  by Seller; 2)  The Royalty
was terminated and instead it was agreed that Seller would retain a 2%
royalty on gross income of SSGG; and 3)  the Non Dilution Agreement was
terminated in exchange for 1,000,000 shares of the Company's common stock
valued at $40,000 issued to the Seller (See Note 9).  As of December 31,
2001, Trailblazer had relinquished all rights to the Royalty, the Non
Dilution Agreement and the Option.

On December 5, 2002, Wind Dancer Aviation Services, Inc. ("Wind Dancer"), a
wholly owned subsidiary of Registrant, purchased certain hard assets and
inventory and fuel associated with the former Fixed Base Operator ("FBO"),
at Stevens Field, Archuleta County, Colorado from the Board of County
Commissioners of Archuleta County, Colorado ("Seller").  The total
consideration paid, including fuel inventory, was $103,375.76. The purchase
price funds were provided by Registrant in the form of an equity infusion
into Wind Dancer.  The nature of the business in which the assets were
used was an FBO, and Wind Dancer continues to use the assets in an FBO.

CURRENT BUSINESS

The Parent
Registrant is pursuing a strategy to establish a technological presence in
the truck and aircraft industries in America. With the national quest for a
balanced energy policy that addresses consumption issues, it is seeking
to do its part to contribute to reductions in our dependence on foreign
energy sources which management believes is a national security issue.
Registrant currently has three divisions, all of which focus on innovative
ways to conserve energy and/or make engine technology more efficient, less
harmful to the environment and effective:  its Gas Gathering System,
located in The Caddo Pine Island Field, in Caddo Parrish, Louisiana, its
AXP 1000 auxiliary power generator for long haul trucks and its Fixed Base
Operator for general aviation aircraft in Pagosa Springs, Colorado and
related general aviation STC development and marketing.  As discussed below,
Registrant has determined to redirect its focus on the transportation
industries.

Gas Gathering Enterprises, LLC

Overview
Registrant's Gas Gathering System is located in Caddo Parish, Louisiana in
the Caddo Pine Island Field (the "Field"), which was discovered in 1905.
Several geological formations have been developed for both oil and gas

                                   3

production, with over 25,000 successful wells having been drilled to date.
In recent years, new drilling (400 to 500 wells) continues to produce shallow
gas as well as some deeper oil and gas zones.  Registrant's Gas Gathering
System is a branch-like construction approximately 72 miles long, which winds
throughout portions of the Field that have heavy concentrations of wells.
Ready access to various leases throughout the Field provides a convenient,
inexpensive method of gathering the vast amounts of casing head gas that are
otherwise vented into the atmosphere from the more than 10,000 Annona Chalk
wells which are located in the Field.  Despite the fact that the Field has
been in operation since 1905, it is estimated that only 15% to 20% of the
total oil and gas reserves in the Field have been captured.  Registrant
estimates that it will be able to connect 5,000 wells in a two year period,
with an average daily output of 2-3 mcf (thousand cu. ft.) of gas.

Natural Gas Industry
According to the U.S. Department of Energy Information Administration's
Historical Natural Gas Annual 1930 - 2000, dated December 2001, total U.S.
consumption of natural gas in 2000 was 22,546,944 million cubic feet.  From
1983 - 1999, consumption increased on an annual basis, although the numbers
in 2000 showed a slight decrease from 1999.  This recent historical increase
in demand demonstrates a burgeoning market.  Smaller companies can capitalize
on the fact that major players in the oil and gas industry often ignore or
abandon smaller, less productive fields and formations, preferring the large
profits available in easily accessible fields, although these smaller fields
still yield significant amounts of gas.  The natural gas market is a $90
billion per year industry (U.S. DOE 1999 report).  An article on Hoovers.com,
entitled "Energy", by Stuart Hampton, states: "Increased demand for natural
gas to fuel power plants has encouraged more exploration for that resource
as well, and it has created more business for natural gas transporters and
marketers."  EENT's Gas Gathering System addresses the growing national need
for alternatives to the traditional sources of energy, in particular to
foreign crude oil.

Detailed Information
As Americans seek more and better ways to trim their energy costs and
consumption and to reduce dependence on foreign energy resources, greater
emphasis is being placed on finding viable fuel alternatives.  Registrant
is contributing to the effort to reduce Western dependence on foreign energy
sources by capturing and making available natural gas that would otherwise be
vented into the atmosphere during the oil pumping process.

Since producers in the Field typically vent casing head gas into the
atmosphere, wasting what is otherwise a valuable commodity, EENT's Gas
Gathering System offers these producers a way to increase revenue through the
capture and sale of the natural gas.  Since EENT's Gas Gathering System does
not cross any state lines and is not a "pipeline", it is exempt from most of
the state and federal regulations that apply to pipelines.  The lack of
compliance requirements reduces production costs and allows the Company to
maximize revenues.  EENT's Gas Gathering System enables oil producers to
capture an otherwise dissipated revenue stream, providing valuable natural
gas to market.

Registrant has had significant challenges in operation of its Gas Gathering
System.  Its original gas purchaser, Prism, was shut down approximately six
weeks during the first three quarters of 2002.  Registrant then attempted to
sell its gas to Koch/Gulf South through an intermediary, Metro Energy, which
is located in the Caddo Pine Island Field, but Metro lacked sufficient
equipment to process the gas.  Unfortunately, Registrant was not able to

                                 4

sell directly to Koch due to the amount of capital required to be able to
install and run the necessary equipment.

Therefore, Registrant has determined on February 18, 2003 that its best
course of action is to attempt to sell the Gas Gathering System.  During
the first quarter of 2003, Registrant approached in excess of six different
parties to locate a purchaser.  It only identified one interested party
(American West Resources, Inc. of Fort Worth, TX ("American West")) with
which it has a letter of intent to sell the System for a purchase price of
$500,000.  Pursuant to a letter of intent, dated March 7, 2003, American
West was entitled to a 30 day exclusive period in which to post a $50,000
non refundable deposit to purchase the System, with closing no later than
90 days from March 7, 2003. On April 3, 2003, Registrant signed an
amendment to the letter of intent to extend the exclusive period to expire
no later than 60 days from March 7, 2003, but the closing date of 90 days
from March 7, 2003 still remains.

AXP 1000

Overview
The AXP 1000 is a device designed for new installation and retrofit to semi
truck tractors which provides air conditioning and heating for long haul
trucks and power generation without running the truck engine to provide
"creature comforts" for the truck cab (i.e.: heating, cooling and operation
of devices requiring electrical power), while keeping the truck battery
charged.  Registrant has filed four provisional patent applications on the
device, with more patent applications to follow.  On December 2, 2002,
Registrant successfully installed its new Auxiliary Power Generator - "AXP
1000" on a truck, and the unit functioned properly, including providing
power to the truck's cab HVAC unit.  On January 2 and 3, 2003, an AXP 1000
unit was installed on a loaned truck, and road testing completed.
Registrant is currently conducting its third road test.  Production and
marketing started in January.

Long Haul Trucking Industry
The trucking industry is a $255.5 billion industry in the U.S. With 480,000
Class 7 and 8 trucks (Source:  TruckInfo.net).  The average truck driver in
the United States makes 30.3 cents per mile and makes an average of $32,000
per year, leading to the assumption that the drivers travel an average of
over 90,000 miles per year.  The trucking industry accounts for 12.8% of all
the fuel purchased in the U.S.

The Argonne National Laboratory Report contains various calculations of
savings by utilization of technology options to idling, including auxiliary
power generators, which show the potential for massive reductions in fuel
consumption.  In conclusion, the Argonne Report states:  "[any] of the
listed alternatives has significant potential to reduce all impacts compared
to idling overnight....  Auxiliary power units [may] reduce energy and
petroleum use and CO2 emissions by more than 80% for the entire year" (using
assumption of 458,000 trucks with 85 days of heating at 10 h/d and 218 days
with average cooling at 4.5 h/d).  Argonne Report at p. 21.

Furthermore, according to an article on the Transportation Technology and
R&D Center (www.transportation.anl.gov), called "Truckers: Don't Let Your
Profits Go Up In Smoke," "assuming 1,830 hours of idling a year, a single
truck emits about 22 tons of carbon dioxide;... 390 pounds of carbon
monoxide; and 1,024 pounds of nitrous oxides."  The article, in a
parenthetical, states there are approximately 480,000 Class 7 and 8 trucks.

                                     5

Detailed Information
The AXP 1000 is a device designed for new installation and retrofit to semi
truck tractors which provides air conditioning and heating for long haul
trucks and power generation without running the truck engine to provide
"creature comforts" for the truck cab (i.e.: heating, cooling and operation
of devices requiring electrical power), while keeping the truck battery
charged.  The Company recently has filed four provisional patent applications
on the device, with more patent applications to follow.  As soon as
sufficient funding becomes available, Registrant will charge counsel with the
task of converting the provisional applications to standard applications.

Recent federal and state laws and regulations collectively limit both the
number of hours per day that long haul truckers may drive and the number of
non-driving hours they may allow their trucks to idle.   Trucks burn a
considerable amount of diesel fuel when idling and release harmful emissions
into the atmosphere.  According to the U.S. Department of Energy's
Transportation Technology R&D Center's website, with a 1000 RPM engine and
truck accessories with a 10 brake horsepower, the total yearly savings for
fuel costs, preventative maintenance and overhauls would be approximately
$5280, even with diesel at a modest $1.35 per gallon.  The AXP 1000 reduces
fuel consumption and release of noxious emissions, as well as lowering the
truck maintenance burden. Reduced engine running time lengthens the
intervals between scheduled maintenance on the truck's engine.

These claims are borne out by industry research.  According to a study by
the Argonne National Laboratory's Transportation Technology R&D Center,
entitled "Analysis of Technology Options to Reduce the Fuel Consumption of
Idling Trucks," published in June 2000, "long-haul trucks idling overnight
consume more than 838 million gallons of fuel annually".  The Study goes on
to indicate that various technology solutions, which reduce idling time, can
be effective methods of saving fuel, reducing maintenance costs and lowering
emissions.  One such solution is the AXP 1000.

The AXP 1000 also has the potential to be a significant money saver.  The
device will retail for $5995 (including installation), so it pays for itself
in less than one year.  Given that the average truck is rotated every three
years or 1,000,000 miles by large companies, and the device pays for itself
in less than one year on average, the device is destined to be a priority
for all long haul truck fleets interested in cost savings.

While there are several other direct competitors in this market, Registrant
believes that the auxiliary power generator is smaller, lighter, more
powerful, more reliable, less expensive and easier to service and install
than any competitive offering in our product category! According to the
Argonne study, cited above, other technology options to reduce idling (such
as direct-fired heaters, which raise safety concerns, in addition to high
retrofitting costs and unknown reliability, thermal storage systems, which
is a relatively new technology without any active manufacturer, and truck
stop electrification (there are almost no truck stops currently offering
plug-ins in the U.S.)) are not currently viable.

On December 2, 2002, the Company successfully installed its new Auxiliary
Power Generator - "AXP 1000" on a truck, and the unit functioned properly,
including providing power to the truck's cab HVAC unit. The Company has
successfully completed its second test of its Auxiliary Power Generator -
"AXP 1000", on January 3, 2003.  The unit was mounted on a truck and
connected to the batteries and HVAC unit, and a dedicated start mechanism
was installed.  The unit generated electricity in excess of that needed to

                                   6

charge the truck batteries and run the HVAC system and other electronics
inside the truck cab.  The unit was installed in the unique mounting
location sought, tied into the stack and installation brackets were
designed and utilized which allow for truck vibration dampening.

Registrant has had much feedback from its launch of the product at the March
2003 Mid America Truck Show.  It is about to be accepted into the testing
program at several major American retail and/or trucking fleet giants.  In
addition, the Registrant has approached several small fleets about initial
orders, to be supplemented with larger orders over a one to two year period.

The distribution method for the AXP 1000 will initially be through
Registrant's in house marketing subsidiary Top Gun Marketing, Inc.  Mark
Whittaker, President of Top Gun, and several other personnel will be working
with him on the marketing effort, including Engineer, Jim Vance.  Registrant
is also in the process of entering into an alliance with Western Kentucky
Powder Coating of Louisville, KY for manufacture and marketing of the AXP
1000.

The source of supplies used to assemble the AXP 1000are off the shelf
products which are readily available.  Major items include Lombardini USA
for the motor, BMZ Generator for the genset, and Dometic for the HVAC unit.
There is no need for government approval of principal products and services,
and components are already UL approved.  Research and development expense
incurred during the year ended December 31, 2002 was approximately $110,000.

The potential market for the AXP 1000 is 480,000 existing Class 7 and 8
trucks and 140,000 new trucks manufactured annually.

Wind Dancer Aviation Services, Inc.

Overview
Registrant owns the fixed base operator ("FBO"; equivalent of a service
station for aircraft), at Stevens Field, Pagosa Springs, Colorado, and it
plans to provide aircraft engine enhancements and installation activities
there. The FBO will provide fuel, oxygen, aircraft parking, flight training
and catering, ground transportation, supplies, pilots' lounge, and rental
cars, in addition to becoming a major center for aircraft repair,
maintenance and upgrades.  The intent is to build the business by offering
unique products and services while developing a service organization to
provide major overhaul and enhancements.  The initial stage of the business
plan consists of basic FBO services offered to an expanded customer base.
Registrant can attract significant business through expansion of services
offered and an effective public relations effort.  The acquisition of
Supplemental Type Certificates (STCs) to offer additional and unique
services and enhancements for planes is planned in stages.  A very unique
opportunity exists due to an FAA-sponsored $16 million capital improvement
program at the Airport, which is scheduled to be completed by 2004.

Detailed Information
On December 5, 2002, Wind Dancer Aviation Services, Inc. ("Wind Dancer"), a
wholly owned subsidiary of Registrant, purchased certain hard assets and
inventory and fuel associated with the former Fixed Base Operator ("FBO"),
at Stevens Field, Archuleta County, Colorado from the Board of County
Commissioners of Archuleta County, Colorado ("Seller").  The total
consideration paid, including fuel inventory, was $103,375.76.



                                     7

The $150,000 is in the form of a loan to Registrant from the Hall Family
Trust which bears interest at 10% per year.  The Promissory Note, dated
December 2, 2002, was originally due and payable on March 2, 2003, extendable
at Registrant's option until June 2, 2003.  Registrant has exercised its
option to extend the loan maturity until June 2, 2003 by issuance of a
letter, dated February 24, 2003, to the Hall Family Trust so extending
maturity until June 2, 2003.  The loan is secured by a first lien on all of
Wind Dancer's assets.

Wind Dancer operates the FBO through a Fixed Base Operator Agreement and
Hangar Lease, dated October 16, 2002 (the "Lease") with the Board of County
Commissioners of Archuleta County, Colorado (the "Board"), which is the
owner of Stevens Field Airport, where the FBO is located.  The effective
date of the Lease was December 5, 2002, which was the closing date of the
asset acquisition.
The salient terms of the Lease are:

Term:  10 years plus one 10 year renewal.  Right of first refusal on further
       renewals.
Rent:  $9,600 per year with CPI adjustments commencing in year two and
       increases of 18% per year commencing in year six.  Rent during initial
       term capped at $22,000 per year.  Fair market rent starting in year 11.
Fuel Flowage Fee:	$0.05 per gallon to Archuleta County.
Aircraft Parking Fee:  70% to Archuleta County.
Required Services:  Ground Guidance, Aircraft Fueling, Apron Servicing, Pilot
                    Facilities, Telephone and Flight Planning, Unicom and
                    Pilot Supplies.
Authorized Services:  Aircraft Maintenance, Flight Services, Aircraft Rentals
                      and Sales, Flight Instruction, Ramp Services, Catering,
                      Heating and De-Icing, Oxygen and Other Gasses, Engine
                      Starting and Rental Vehicles.
Operating Standards:  Includes required open hours during summer and winter
                      season and handling and storage of aviation fuel per
                      the fuel farm covered by the Lease.
Lease Covenants:  Industry standard covenants covering maintenance, etc.
Events of Default:  Failure to make any payment within 10 days after it is
                    due; failure to perform any covenant, etc. and failure
                    to cure within 30 days after notice of default from the
                    Board; bankruptcy, insolvency, etc. not dismissed within
                    90 days after filing; Wind Dancer is prohibited from
                    operating the FBO for a 60 day period; and voluntary
                    abandonment by Wind Dancer of operation of FBO for a
                    period of more than 10 days.  An Event of Default gives
                    the Board the right to terminate the Lease.
Insurance:  Liability insurance of $1,000,000 per occurrence and $1,000,000
            in the aggregate.
Change in Control:  A change in control (defined as a transfer of 51% or
                    more of the equity interest in Wind Dancer) must be
                    approved in writing by the Board, unless the change in
                    control is due to an investor financing for the FBO
                    operation, in which Wind Dancer remains in operational
                    control of the FBO.

The intent is to build the business by offering unique products and
services while developing a service organization to provide major overhaul
and enhancements.  The initial stage of the business plan consists of basic
FBO services offered to an expanded customer base.  The Company believes it
can attract significant additional business through expansion of services

                                   8

offered and an effective public relations effort (in conjunction with the
Airport and local government).  The acquisition of 35 Supplemental Type
Certificates (STCs) for turbo chargers offers an additional and unique
services and enhancements for planes is planned in stages.  Wind Dancer
anticipates making that acquisition in the second quarter of 2003.

Initially, a series of turbocharger products and parts will be offered, along
with new paint, plane interior upgrades and avionics services. Longer term
projects involve the end stage effort to finalize new STC approvals now in
progress by developers associated with EENT.  Company management has targeted
completion of STC approval and manufacturing to coincide with the completion
of the major airport expansion at Stevens Field in 2004.

The FBO business is close to breaking even and in the opinion of Company
management constitutes a solid base upon which to build.  EENT's plan is to
systematically add business services while airport improvements are in
process with the goal of becoming a successful provider of new products at a
"new" airport, in a very favorable destination.

Aircraft Enhancements
FAA Type Certificates (TC) and Supplemental Type Certificates (STC) are the
aviation equivalents of a patent.  If the manufacturer decides to make major
changes to an airframe design, it must go through a new FAA certification
program. An examination of the fuselage of Aero Commanders and most other
general aviation aircraft will show relatively little change over a 30 year
period.  The basic airframe is designed to last 10,000 to 25,000 hours and
the average yearly use is 200 flying hours (50 to 125 years). Aircraft
manufacturers are producing airplanes today that were designed and certified
by the FAA 20, 30 even 50 years ago.

FAA regulations do not require prior FAA certification of individuals or
entities seeking to be STC proponents to design and manufacture improvements
for aircraft as long as the improvements meet the Regulations, and the
proponents perform the required engineering documentation and testing to
qualify for a STC. The TC/STC process has a monopolistic effect because
regulations restrict aircraft owners from installing any part or device on a
plane which does not carry a STC approval for that particular plane.  Cost to
obtain STC approval, narrow market and limited expertise discourage
competition.

EENT is preparing to capitalize on this opportunity in the aircraft industry
with its new STC acquisitions for several enhancements to existing types of
general aviation aircraft.

There is a large potential market of such aircraft in need of modernization
to provide better performance and increased speed, comfort and utilization.

Turbocharger Power Systems
Many general aviation aircraft lack modern, high power engines due to static
designs.  Since the airframes are still very much in demand, there is huge
potential to upgrade through provision of modernization enhancement such as
engine turbo charger kits.  In early days of aircraft turbo-charging, little
was known, understood or given attention to the effects of induction heat
caused by the air being compressed. The early systems were designed so the
aircraft owner could choose either normally aspirated or turbo-charged. A
problem developed later when a turbocharger "coked up" because the turbine
did not run continuously. Much has recently been learned about inter-cooling,
maximizing gas velocities, waste gate controls and sealed exhaust systems.

                                    9

Turbocharging an engine increases power produced by an engine and facilitates
equal power output at various altitudes.  Normally aspirated engines vary in
power output relative to altitude; therefore, the addition of a turbocharger
to a normally aspirated engine increases and stabilizes power output which in
turn increases payload limit of the airplane.  Turbo-charging also decreases
noise two ways. First, the turbocharger converts 60% of the exhaust energy
(noise) into useful work turning the compressor. Power now available at
altitude allows a decrease in propeller RPM decreasing tip speed, a 8% to 16%
noise reduction. Second, inter-cooling is extremely important because when
air is compressed it gets hot. It is not unusual for temperatures to exceed
300 degrees F. For every 10 degree increase in the temperature of the air,
1% of the available power is lost.

EENT is pursuing relationships to acquire STCs which will facilitate repair
and/or replacement of existing turbochargers on various models and
manufacturers of aircraft.  Company research indicates demand based on lack
of parts support as well as interest in retrofit turbochargers for
performance enhancement.

The distribution of products and services will be through Wind Dancer and Top
Gun Marketing.  The acquisition of the STCs is fully dependent on the ability
of Registrant to raise funding for such acquisition.  There is no direct
competition to the FBO as the FBO is the only one operating at Stevens Field,
although the Lease does provide that the Board may authorize further FBOs in
the future, as required by federal law and regulation (but, as Wind Dancer
occupies the only hangar, a new FBO would need to secure a new hangar).  The
major raw material is avgas and jet fuel, which Wind Dancer purchases from
Western Petroleum, Inc., which is a Chevron supplier.  Wind Dancer is in the
process of negotiating a full fuel supply contract with Western Petroleum,
which shall also include a nominal amount of capital expenditure financing.
Wind Dancer does not depend on any one or several major customers, and its
customer base is both local pilots and transient general aviation aircraft
business.  Wind Dancer has no intellectual property at the current time,
until the purchase of the STCs if, as and when consummated.  There
is governmental approval required to obtain STCs; however, Wind Dancer
anticipates that when it purchases the STCs, governmental approval will
already have been obtained.  The aircraft industry is heavily regulated by
the FAA; however, the FBO will not suffer any adverse effect from any further
regulation as opposed to other FBOs, as the regulations apply to all general
aviation airports and hence all FBOs.  There are compliance requirements for
environmental purposes for fuel spills at the federal, state and local
government levels, which the FBO complies with.  Additionally, the FBO's
liability insurance includes hangarkeeper's liability which covers fuel
spills from the FBO fuel trucks up to policy limits.  The fuel farm is not
owned by the FBO; however, the FBO has usage and may have exposure if it
were not covered by its insurance.

The management team has substantial experience in the engine manufacturing
and aviation fields.  This will greatly assist in the redirected core
businesses.

There have been no bankruptcy, receiverships, or similar proceedings by or
against Registrant.

As of December 31, 2002, Registrant and its subsidiaries had three full
time employees other than their officers and directors.  Each of
Registrant's CEO, CFO and General Counsel are to receive a salary of
$180,000 per year, but each received under $75,000 in 2002.  The President

                                    10

of Wind Dancer Aviation, Tylor Hall, is to be paid a salary of $5,000 per
month through May 2003, and $6,000 per month thereafter, with potential
bonuses in restricted stock of Registrant upon meeting performance goals.
Tylor Hall was given up to $6,000 for moving expenses and has a one year
renewable contract of employment.  No one is represented by a collective
bargaining agreement.

ITEM 2.  DESCRIPTION OF PROPERTY

Registrant's executive offices are located at 5308 West Plano Parkway, Plano,
Texas, which it leases on a monthly basis, at competitive market rates. Wind
Dancer Aviation maintains its offices at the FBO and Gas Gathering
Enterprises, LLC maintains offices in Shreveport, Louisiana.  Registrant
believes that its facilities are adequate for its current needs and that
suitable additional or substitute space will be obtained as and when needed.

ITEM 3.  LEGAL PROCEEDINGS

On February 10, 2003, the Securities and Exchange Commission ("SEC") Staff
("Staff") wrote the Company's counsel and indicated that it was prepared to
recommend to the SEC in Washington that it institute proceedings against the
Company and Mr. Willard McAndrew, Chairman, President, Chief Executive
Officer and Director ("Mr. McAndrew") for violations of Sections 5(a) and
5(c) of the Securities Act of 1933.  The focus of the investigation is on
the Company's issuance of certain shares of its common stock in January 2002
pursuant to an S-8 registration statement.  Pursuant to the Company's
Counsel, the staff of the SEC agreed instead to recommend that the SEC
accept an offer from the Company to accept a cease and desist order in
settlement of administrative proceedings and not to institute proceedings
against Mr. McAndrew.  There can be no guarantees however that the SEC will
accept the Staffs recommendation.  These financial statements do not include
any adjustments that might result should the SEC institute proceedings
against the Company.

Other than as stated above, Registrant is not a party to any legal
proceedings.

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

There were no matters submitted to a vote of security holders during the
fourth quarter of the fiscal year ended December 31, 2002.


                             PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Registrant's Common Stock is traded on the OTCBB under the symbol EENT and
has been traded on the OTCBB since the Registrant's initial public offering
(under Rule 504) in 2000. According to records of the Registrant's stock
transfer agent, Registrant had 508 stockholders of record as of December 31,
2002. The following table sets forth the low and high bid price of the
Company's Common Stock, based on the last bid price, in each of the
Company's last eight quarters:

<TABLE>
<CAPTION>


                                 11

    <S>                     <C>                 <C>
    Quarter Ended           Low Bid Price       High Bid Price
    -------------           ---------------     ----------------
    December 31, 2002             .04                 .14
    September 30, 2002            .03                 .08
    June 30, 2002                 .03                 .16
    March 31, 2002                .14                 .49
    December 31, 2001             .14                6.00
    September 30, 2001            .75                7.06
    June 30, 2001                7.00                8.25
    March 31, 2001                .00                 .00

</TABLE>

The reported high and low bid prices of our common stock are above for each
quarter during the last two complete fiscal years.  The high and low
bid price for the periods in 2001 and 2002 shown above are quotations from
the OTCBB.  The quotations reflect inter-dealer prices and do not
include retail mark-ups, mark-downs or commissions.  The prices do
not necessarily reflect actual transactions.

No assurance can be given that any established market for the Company's
common stock will develop or be maintained.  For any market that develops
for the common stock, the sale of "restricted securities" pursuant to Rule
144 promulgated under the Securities Act of 1933 by members of management
and others or any other person to whom any such securities may be issued in
the future may have a substantial adverse impact on any such public market.
Information about the date when current holders' holding period of
"restricted securities" commenced can be found below under the heading
"Recent Sales of Unregistered Securities" of this Item.  A minimum holding
period of one year is required for resales under Rule 144, along with other
pertinent provisions, including publicly available information concerning
our Company (this requirement will be satisfied by the filing of this Annual
Report and the continued timely filing by us of all future reports required
to be filed by us with the Securities and Exchange Commission; limitations
on the volume of "restricted securities" which can be sold in any 90 day
period; the requirement of unsolicited broker's transactions; and the filing
of a notice of Sale on Form 144).

As of the date of filing this Annual Report, there has been limited trading
for the common stock; the current bid/ask prices are in the range of $.052/
$.055. There has been no steady or substantial sales or volume since trading
commenced and the sales were 20,000 shares at $0.06 per share close on April
11, 2003.

Registrant has adopted the policy to reinvest earnings to fund future growth.
Accordingly, Registrant has not paid dividends and does not anticipate
declaring dividends on its Common Stock in the foreseeable future.

Recent Common Stock Transactions

On January 10, 2002, Company issued 445,000 shares of common stock valued at
$138,400 to consultants for services provided.

On April 25, 2002, the Company issued 142,650 shares of common stock valued
at $17,868 to consultants for services provided.



                                     12

On April 26, 2002, the Company issued 35,000 shares of common stock valued at
$4,550 to a consultant for services provided.

On May 24, 2002, the Company issued 500,000 shares of common stock valued at
$30,000 to a consultant for services provided.

On June 28, 2002, August 13, 2002, September 29, 2002 and December 23, 2002
in connection with private placement offerings, the Company sold 3,500,000
shares of common stock to an investor at $0.10 per share or an aggregate of
$350,000.  In connection with these private offerings the Company issued
warrants to purchase an aggregate of 300,000 shares of the Company's common
stock with an exercise price of $0.25 expiring through January 16, 2005.
Also in connection with these offerings the Company and the investor entered
into an agreement whereby the investor's 3,500,000 share common stock
ownership in the Company at December 31, 2002 is non-dilutable by common
stock issued by the Company beyond 20,000,000 shares, or 17.5%.  At December
31, 2002, the amount of shares deemed issued relating to the non-dilution
agreement is 201,817.  The non-dilution agreement was originally effective
until December 12, 2004 and does not include stock issuances over 20,000,000
shares which are attributable to shares issued in a merger or acquisition
that increases value and is approved by a majority of the stockholders of
the Company.  The non-dilution agreement has subsequently been extended to
January 17, 2005 and the non-dilution percentage has increased to 20% based
on additional investments.

On August 13, 2002, the Company issued 13,975 shares of common stock valued
at $559 to a consultant for services provided.

On August 13, 2002, in connection with a private placement offering, the
Company sold 1,000,000 shares of common stock to an investor at $0.10 per
share or $100,000.  In connection with this private placement offering the
Company issued warrants to purchase 100,000 shares of the Company's common
stock with an exercise price of $0.25 expiring on August 13, 2004.

On August 29, 2002, the Company issued 5,650,000 shares of common stock
valued at $226,000 to officers and employees for services provided.

On August 29, 2002, the Company issued 1,000,000 shares of common stock
valued at $40,000 in connection with a termination agreement.

On August 29, 2002, the Company issued 100,000 shares of common stock valued
at $4,000 to consultants for services provided.

On October 10, 2002, the Company issued 100,000 shares of common stock valued
at $4,000 to consultants for services provided.

On November 14, 2002 as part of a private placement an investor purchased a
one quarter (1/4) unit for $5,000.  This one quarter (1/4) unit consists of
a $5,000 note payable, 5,000 shares of the Company's common stock, 5,000
warrants to purchase the Company's common stock at an exercise price of
$0.10 per warrant exercisable through November 14, 2003 and 5,000 warrants to
purchase the Company's common stock at an exercise price of $0.25 per warrant
exercisable through November 14, 2004.

On November 29, 2002 the Company issued 50,000 shares of the Company's
common stock valued at $3,500 to a stockholder for consulting services as
part of an investment agreement, consisting of a $25,000 note payable and


                                   13

50,000 warrants to purchase the Company's common stock at an exercise price
of $0.10 per warrant exercisable through December 1, 2005.

On December 3, 2002, the Company issued 25,000 shares of common stock valued
at $1,750 to an employee for services provided.

On December 3, 2002 the Company entered into a $150,000 note payable
agreement with an investor which accrues interest at 10% and is due June 3,
2003.  In connection with this note the Company issued 50,000 shares of the
Company's common stock valued at $3,500.

Management believes that each of the foregoing persons or entities was
either an "accredited investor," or "sophisticated investor" as defined in
Rule 506 of Regulation D promulgated under the Securities Act of 1933.  Each
had access to all material information about the Company prior to the offer,
sale or issuance of these "restricted securities."  We believe these shares
were exempt from the registration requirements of the Securities Act,
pursuant to Section 4(2) thereof.

The valuation of these shares was based on trading volume and prices.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

RESULTS OF OPERATIONS
----------------------

As of December 31, 2002, Registrant had realized minimal revenues.
Registrant realized its first revenues in March 2002 in the amount of
$556.00 for the month and its further revenues were very disappointing
based on its projections.  The reasons were due to its challenges with
its Gas Gathering System as discussed in Item 1. above.

Registrant had a net loss of $1,680,989 at December 31, 2002, resulting
in a net loss per share of $0.11.

General and administrative expenses at December 31, 2002 were $1,218,306.

LIQUIDITY AND CAPITAL RESOURCES
--------------------------------

During 2002, Registrant's primary sources of liquidity included cash
and cash equivalents in the amount of $680,000, which was the balance
of proceeds raised in several private Section 4(2) stock sales and note
payable agreements.

Registrant believes that its existing cash balance and future operating cash
flows may not be sufficient for near term operating needs unless it is able
to quickly and consistently expand its operations in the Field and is
exploring various opportunities to raise additional capital. The extent to
which such sources will be sufficient to meet Registrant's anticipated cash
requirements is subject to a number of uncertainties, the most important of
which is Registrant's ability to generate sufficient cash flow to support
its business operations.

Our independent auditors have noted in their report on our 2002 financial
statements that there are existing uncertain conditions including the net
loss the Company incurred in the amount of $1,680,989 during the year ended

                                      14

December 31, 2002 and the working capital deficit of $854,392 that existed
at the balance sheet date.  These conditions raise substantial doubt as to
our ability to continue as a going concern.

ITEM 7.  FINANCIAL STATEMENTS AND SELECTED FINANCIAL DATA

Registrant's financial statements for the years ended December 31, 2002,
audited by Marcum & Kliegman, LLP, and December 31, 2001, audited by Parker
& Co., are included herein in full.


ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

On March 19, 2003, Registrant engaged Marcum & Kliegman, LLP as its
auditors and terminated Parker & Co.'s engagement.


                          PART III


ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT.

Each of Registrant's directors is elected by the stockholders to a term of
one year and serves until his or her successor is elected and qualified.
Each of the officers is elected by the Board of Directors to a term of one
year and serves until his or her successor is duly elected and qualified,
or until he or she is removed from office. The Board of Directors has no
nominating, auditing or compensation committees.

The names, addresses, ages and positions of the current officers and
directors is set forth below:

<TABLE>
<CAPTION>


<S>                               <C>    <C>
Name and Address                  Age    Position(s)
-----------------                ----   -------------
Willard G. McAndrew III           48     Chairman, President, Chief
                                         Executive Officer and
                                         Director

Roger Wurtele                     56     Vice President, Chief Financial
                                         Officer and Director

Mark L. Whittaker                 43     Vice President-Sales and
                                         Marketing

James Vance                       43     Vice President, Operations

Jolie Kahn                        38     General Counsel and Secretary

Robert Farris                     76     Director

</TABLE>


                                  15

Background of Officers and Directors
-------------------------------------

Willard G. McAndrew, III - Since 1998, Mr. McAndrew had been the President
and Manager of Millennium Fuels USA, LLC., an affiliate of Millennium Fuels
Corporation. Mr. McAndrew had been the President and the Chairman of the
Board of Directors of Millennium Fuels Corporation since 2001. Millennium was
a developer and producer of both fuels and alternative fuels, domiciled in
Plano, Texas. From 1996 until 1998, he served as president and a director of
McAndrew Management II, Inc., a developer and operator of oil and gas
production projects located in Richardson, Texas. Mr. McAndrew devotes his
time as required to the business of Registrant.

Roger Wurtele - Since 2001, Mr. Wurtele had served Vice President and a
director of Registrant.  Since 1998, he had also been the Manager and
Principal Financial Officer of Millennium Fuels, USA, LLC. Millennium Fuels,
USA, LLC was a developer of products in both the fuels and alternative fuels
industries. From 1995 until 1998, Mr. Wurtele was the President and a
director of Controllership Services, Inc., a provider of financial
consulting services located in Shreveport, Louisiana.  Mr. Wurtele holds a
Bachelors Degree in Business Administration from the University of Nebraska
and is admitted as a Certified Public Accountant in the states of Colorado
and Louisiana. He devotes his time as required to the business of Registrant.

Mark L. Whittaker - Mr. Whittaker had been the President of 600 Racing, a
North Carolina company, since March of 1997 and devotes his time as required
to the business of Registrant.

James Robert "Jim" Vance, Jr. - Mr. Vance is Vice President of Operations for
the AXP 1000.  At EENT and other positions that he has held, Mr. Vance is
responsible for assembly and manufacturing and quality control and shipping
issues for products, respectively.  Formerly, Jim was Executive Vice
President/Chief Operations Officer for Holley Performance Products, Inc and
had operational and engineering responsibility for three divisions, sixteen
facilities and approximately 1100 employees.  Jim has also worked for several
Fortune 500 Companies over the past twenty years where he has held numerous
positions of increasing responsibility.  Jim is a graduate of the University
of Alabama in Tuscaloosa, Alabama where he earned a Bachelor of Science
degree in Industrial Management.  Further, Jim was recognized in 1982 by the
State of Alabama Legislature with a resolution recognizing his academic
accomplishments.  Jim is also a graduate of the Kentucky Institute for
Economic Development.

Jolie Kahn - Ms. Kahn received her Bachelor of Arts degree in Government
from Cornell University in Ithaca, New York and graduated magna cum laude
from the Benjamin Cardozo School of Law in New York, New York in 1989, where
she was a member of its Law Review and an Alexander Fellow.  Since that time,
she has represented both private and public companies in varied aspects of
general corporate, securities, corporate finance and mergers and acquisitions
law and transactions.  In addition, Ms. Kahn has counseled clients in areas
related to their general day-to-day business affairs, such as employment and
taxation issues.  Ms. Kahn's career began at Weil, Gotshal & Manges, LLP in
New York City, and most recently, she had acted as an in-house counsel to a
"high tech" company in Boca Raton, Florida.

Robert Farris - Mr. Farris serves as a Director of EENT.  After three years
in the U.S. Army in Korea, Mr. Farris became the Safety Director for Valley
Transit Company in 1955.  In 1963, he became President, a position he holds

                                   16

to the present day.  Mr. Farris has also served as Director for Texas State
Bank, Harlingen, Texas, Texas Regional Bancshares, McAllen, Texas, National
Bus Traffic Association, Texas Motor Transportation Association, Texas
Tourist Council and Arxa International Energy Corporation.  Mr. Farris'
civic activities include Board of Trustees Marine Military Academy, President
of Harlingen Chamber of Commerce, Harlingen Industrial foundation, Inc.,
Lower Rio Grande Valley Chamber of Commerce, Algodon Club, Crusade Chairman
for the American Cancer Society, Vice President Rio Grande Council of Boy
Scouts of America, Board Member for the First United Methodist Church of
Harlingen and Member of Phi Gamma Delta.  Mr. Farris has been recognized for
his accomplishments by Who's Who in America and Who's Who in Finance and
Industry.

To the best of Registrant's knowledge, all Section 16 reporting requirements
were timely met by all of Registrant's officers, directors and control
persons.

ITEM 10.  EXECUTIVE COMPENSATION

As of December 31, 2002, the CEO and CFO had each been compensated $70,000
and 2,000,000 shares of restricted stock for their services and the General
Counsel was compensated $60,000 and 1,000,000 shares of restricted stock.

<TABLE>
<CAPTION>


                                 SUMMARY COMPENSATION TABLE

<S>           <C>        <C>         <C>        <C>           <C>            <C>           <C>            <C>
                              ANNUAL COMPENSATION                      LONG TERM COMPENSATION
                         -----------------------------------  ------------------------------------------

                                                                      Awards               Payouts


Name and                                        Other         Restricted     Securities
principal                                       annual           Stock       underlying                    All other
position      Year       Salary      Bonus      compensation    Awards       Options/SARs  LTIP Payouts   compensation
----------------------------------------------------------------------------------------------------------------------
CEO
Willard G.    2002       $ 180,000                             $  80,000
McAndrew

CFO
Roger         2002       $ 180,000                             $  80,000
Wurtele

General
Counsel

                                       17

Jolie         2002       $ 180,000                             $  40,000
Kahn

V.P.
Sales
Mark          2002                                $   60,000   $  14,000
Whittaker

President
Wind
Dancer
Tylor         2002       $   5,000                             $       0
Hall

</TABLE>

On January 10, 2002 registrant's Board of Directors adopted Registrant's
2002 Consulting Services Plan (the Consulting Plan) in order to advance the
interests of the Corporation by rewarding, encouraging and enabling the
acquisition of larger personal proprietary interests in the Corporation by
employees, directors and former directors of, and contractors and consultants
to, the Corporation, and its Subsidiaries who have:  1) served without
salaries or other compensation; and 2) assisted the Corporation with support
services for its business development.  The Consulting Plan provides for an
aggregate of 1,000,000 shares of the registrant's $.001 par value common
stock, that may be awarded from time to time at the sole discretion of the
Board of Directors. All shares had been issued under the Plan as of the date
of the filing of this Annual Report. The Consulting Plan was filed as an
Exhibit to Registrant's Form 8K, filed with the U.S. Securities and Exchange
Commission on January 18, 2002.

On December 20, 2002 registrant's Board of Directors adopted Registrant's
2002 - 2003 Consulting Services Plan (the Consulting Plan) in order to
advance the interests of the Corporation by rewarding, encouraging and
enabling the acquisition of larger personal proprietary interests in the
Corporation by employees, directors and former directors of, and contractors
and consultant to, the Corporation, and its Subsidiaries who have:  1) served
without salaries or other compensation; and 2) assisted the Corporation with
support services for its business development.  The Consulting Plan provides
for an aggregate of 1,000,000 shares of the registrant's $.001 par value
common stock, that may be awarded from time to time at the sole discretion of
the Board of Directors. The Consulting Plan was filed as an Exhibit to
Registrant's Form 8K, filed with the U.S. Securities and Exchange Commission
on December 4, 2002.  Approximately 190,000 shares have been issued under
this Plan as of the date of filing this Annual Report.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The following table sets forth the total number of shares owned beneficially
by each of Registrant's directors, officers and key employees, individually
and as a group, and the present owners of 5% or more of total outstanding
shares. The stockholders listed below have direct ownership of their shares
and possess sole voting and dispositive power with respect to the shares.

<TABLE>
<CAPTION>

<S>             <C>                        <C>            <C>

                                   18

--------------------------------------------------------------------
Title of Class  Name and Address           Amount and
                of Beneficial              Nature of      Percent
                Owner                      Beneficial     of Class
                                           Ownership
--------------------------------------------------------------------

Common Stock    Willard G. McAndrew III    2,927,604 (D)    13.16%
                5308 W. Plano Parkway
                Plano, Texas 75093

Common Stock    Roger N. Wurtele           2,339,604 (D)    10.52%
                5308 W. Plano Parkway
                Plano, Texas 75093


Common Stock    Jolie G. Kahn              1,192,362 (D)     5.36%
                5308 W. Plano Parkway
                Plano, Texas 75093

Common Stock    Mark Whittaker               550,000 (D)     2.47%
                5308 W. Plano Parkway
                Plano, Texas 75093

Common Stock    Tylor Hall                   270,000 (D)     1.21%
                5308 W. Plano Parkway
                Plano, Texas 75093
------------------------------
All Officers and Directors as              7,279,840 (D)    32.73%
a Group

Common Stock    Kevin W. Smyth             3,500,000 (D)    15.73%

</TABLE>

*(D) = Direct Beneficial Ownership

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

As part of the original August 2001 acquisition of the Gathering System and
the GlobalSat data, Trailblazer Productions, LLC was to receive a future 6%
royalty and option to purchase 25% of the Gathering System.  Messrs.
McAndrew and Wurtele were to have been recipients of 50% of any proceeds
from the royalty and 50% of the potential option interest, collectively, in
the Gathering System. Due to the assumption of management of the Registrant
in December 2001, Messrs. McAndrew and Wurtele have agreed to forego their
interests in the royalty and the option, and in exchange for the royalty
and option being cancelled, the Registrant negotiated a fair market buyout
with the recipients of the other 50% of the interests in the royalty and
option, which was concluded in August 2002.

Notes Payable to Stockholders

On July 9, 2002 the Company entered into a $50,000 note payable
agreement with a stockholder which accrues interest at 7% and is due
July 9, 2003.  In the event of default on the maturity date, the Company
would be required to satisfy the note by issuing shares of the Company's


                                    19

common stock by dividing the principal balance due by 50% of the average
ten day closing price of the stock preceding the maturity date.

On November 14, 2002, as part of a private placement offering a
stockholder purchased a one quarter (1/4) unit for $5,000.  This one
quarter (1/4) unit consists of a $5,000 note payable which accrues interest
at 10% and is due on November 14, 2003 as well as 5,000 shares of the
Company's common stock plus 5,000 warrants to purchase the Company's
common stock at an exercise price of $0.10 per warrant exercisable through
November 14, 2003 plus 5,000 warrants to purchase the Company's common stock
at an exercise price of $0.25 per warrant exercisable through November 14,
2004.

On November 29, 2002 as part of an investment agreement, the Company
entered into a $25,000 note payable agreement with a stockholder which
accrues interest and 10% and is due in monthly installments through December
1, 2003.  In the event of default on the monthly installments through the
maturity date, the Company would be required to satisfy the note by
recording a lien on the assets of Gas Gathering and its gas gathering system
and shall assign all proceeds from gross revenues realized from the sale of
gas and liquids from these operations until the note and all interest and
default interest was paid in full.  In connection with this investment
agreement the Company issued 50,000 warrants to purchase the Company's
common stock at an exercise price of $0.10 per warrant exercisable through
December 1, 2005 (See Note 11).  Also in connection with this investment
agreement the Company issued 50,000 shares of the Company's common stock to
the shareholder for consulting services.

On December 3, 2002 the Company entered into a $150,000 note payable
agreement with a stockholder which accrues interest at 10% and is due June
3, 2003.  In connection with this note the Company issued 50,000 shares of
the Company's common stock.  Lender's trustee is Tylor Hall's brother.

The fair market value of the 10,000 warrants issued on November 14, 2002 and
the 50,000 warrants issued on November 29, 2002 approximated $2,200 estimated
at the date of grant using the Black-Scholes option-pricing model.  The fair
market value of the 5,000 shares of the Company's common stock issued on
November 14, 2002 and the 50,000 shares of the Company's common stock issued
on December 3, 2002 approximated $3,750 estimated based on the average
trading value of the stock.  These amounts were recorded as increases to
both additional paid in capital and deferred debt discount.  The deferred
debt discount will be amortized to interest expense over the life of the
notes.  Interest expense relating to this deferred debt discount for the
year ended December 31, 2002 was $1,097.

The President, CEO and majority shareholder of American West Resources, the
party with which Registrant has the letter of intent to sell the Gas
Gathering System is the father in law of Registrant's President and CEO,
Willard G. McAndrew, III.  Registrant believes that it negotiated the
transaction at arms length notwithstanding the relationship between Willard
G. McAndrew, III and American West's CEO.

ITEM 13.  EXHIBITS, LISTS AND REPORTS ON FORM 8-K.

(a)     Registrant's financial statements for the years ended December 31,
        2002 and December 31, 2001 are included herein.



                                    20

(b)     Registrant's Form 8-K, filed on January 18, 2002 is incorporated
        herein in its entirety.

(c)     Registrant's Form S-8, filed on January 29, 2002 is incorporated
        herein in its entirety.

(d)     Registrant's Form 8-K, filed on December 4, 2002 is incorporated
        herein in its entirety.

(e)     Registrant's Form S-8, filed on December 4, 2002 is incorporated
        herein in its entirety.

(f)     Registrant's Form 8-K, filed on March 24, 2003 is incorporated
        herein in its entirety.

(g)     Registrant's Form 8-K/A, filed on March 24, 2003 is incorporated
        herein in its entirety.

(h)     Registrant's Form 8-K/A, filed on March 26, 2003 is incorporated
        herein in its entirety.

(i)     Registrant's Form 8-K, filed on April 9, 2003 is incorporated
        herein in its entirety.

The following exhibits are included herein, except for the exhibits marked
with an asterisk, which are incorporated herein by reference and can be
found in Registrant's original Form 10SB/A Registration Statement, filed
on March 23, 2001, Form 8-K, filed on August 29, 2001, and Form 8-K, filed
on December 17, 2001, and Form 8-K filed on December 4, 2002.

<TABLE>
<CAPTION>

<S>                   <C>                                        <C>
Exhibit Number        Description                                Page
---------------       -----------                                ----
   3(i)  *            Articles of Incorporation
   3(i)  *            Amendment to Articles of Inc.
   3(ii) *            Bylaws
   3(ii)              Amendment to Bylaws                         53
   4                  Reaffirmation Agreement                     54
   10                 Promissory Note and Security Agreement      57
   10                 Fixed Base Operator Agreement and Lease     61
   99(i) *            Consulting Plan
   99(ii)*            Purchase and Sale Agreement
   99(iii)*           Consulting Plan
   99(iv)             906 Consent                                 93

</TABLE>


ITEM 14.  CONTROLS AND PROCEDURES.

Disclosures Controls and Procedures

The Company maintains controls and procedures designed to ensure that it is
able to collect the information that is required to be disclosed in the
reports it files with the SEC, and to process, summarize and disclose this

                                    21

information within the time period specified in the rules of the SEC. The
Company's Chief Executive and Chief Financial Officers are responsible for
establishing, maintaining and enhancing these procedures. They are also
responsible, as required by the rules established by the SEC, for the
evaluation of the effectiveness of these procedures.

Based on their evaluation of the Company's disclosure controls and
procedures which took place as of a date within 90 days of the filing of
this report, the Chief Executive Officer and the Chief Financial Officer
believe that these procedures are effective to ensure that the Company is
able to collect, process and disclose the information it is required to
disclose in the reports it files with the SEC within the required time
period.

Internal Controls

The Company maintains a system of internal controls designed to provide
reasonable assurance that transactions are executed in accordance with
management's general or specific authorization; transactions are recorded
as necessary to (1) permit preparation of financial statements in
conformity with accepted accounting principles generally accepted in the
United States of America, and (2) maintain accountability for assets.
Access to assets is permitted only in accordance with management's general
or specific authorization.

Since the date of the most recent evaluation of the Company's internal
controls by the Chief Executive and Chief Financial Officers, there have
been no significant changes in such controls or in other factors that could
have significantly affected those controls, including any corrective actions
with regard to significant deficiencies and material weaknesses.

                          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.

               Energy & Engine Technology Corporation

Dated:  April 15, 2003    By:/s/  Willard G. McAndrew III
                          President, CEO and Chairman of the Board

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
Registrant and in the capacities and on the dates indicated:

By: /s/ Willard G. McAndrew III
        President, Chief Executive
        Officer and Chairman of the Board

Dated:  April 15, 2003

By: /s/ Roger Wurtele
        Vice President, Secretary, Chief
        Financial Officer and Director

Dated:  April 15, 2003

                                  22

CERTIFICATIONS

I, Willard G. McAndrew, III, certify that:
1. I have reviewed this annual report on Form 10-KSB of Energy &
Engine Technology Corporation;
2. Based on my knowledge, this annual report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period
covered by this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being
prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and
6. The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.

Date: April 15, 2003

/s/ Willard G. McAndrew, III

Willard G. McAndrew, III
President and CEO

I, Roger N. Wurtele, III, certify that:
1. I have reviewed this annual report on Form 10-KSB of Energy &
Engine Technology Corporation;
2. Based on my knowledge, this annual report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under

                                  23

which such statements were made, not misleading with respect to the period
covered by this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being
prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and
6. The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.

Date: April 15, 2003

/s/ Roger N. Wurtele

Roger N. Wurtele
CFO
















                                   24

















                  ENERGY & ENGINE TECHNOLOGY CORPORATION
                            AND SUBSIDIARIES

                    CONSOLIDATED FINANCIAL STATEMENTS

              For the Years Ended December 31, 2002 and 2001




































                                     25

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                                                   CONTENTS
---------------------------------------------------------------------------

<TABLE>
<CAPTION>

<S>                                                                    <C>
                                                                       Page

INDEPENDENT AUDITORS' REPORT                                              1

INDEPENDENT AUDITORS' REPORT                                              2


CONSOLIDATED FINANCIAL STATEMENTS

  Balance Sheet                                                           3
  Statements of Operations                                                4
  Statements of Stockholders' Equity (Deficiency)                       5-6
  Statements of Cash Flows                                              7-8


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                             9-25


</TABLE>






























                                    26

                         INDEPENDENT AUDITORS' REPORT
                         ----------------------------



To the Board of Directors and Stockholders of
Energy & Engine Technology Corporation and Subsidiaries

We have audited the accompanying consolidated balance sheet of Energy &
Engine Technology Corporation and Subsidiaries as of December 31, 2002
and the related consolidated statements of operations, stockholders'
equity (deficiency) and cash flows for the year 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 audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of Energy & Engine Technology Corporation and Subsidiaries as of December 31,
2002, and the results of their operations and their cash flows for the year
then ended, in conformity with accounting principles generally accepted in
the United States of America.

The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. As discussed in
Note 1 to the consolidated financial statements, the Company incurred a net
loss of $1,680,989 and has a working capital deficit of $854,392.  These
conditions raise substantial doubt about the Company's ability to continue
as a going concern. Management's plans regarding those matters also are
described in Note 1. The consolidated financial statements do not include
any adjustments that might result from the outcome of this uncertainty.



/S/ Marcum & Kliegman LLP


New York, New York
March 29, 2003, except for Note 13D for which the date is April 3, 2003 and
Note 13E for which the date is April 7, 2003








                                  27

                       INDEPENDENT AUDITORS' REPORT
                       ----------------------------



To the Stockholders of Energy & Engine Technology Corporation

We have audited the consolidated statements of loss and deficit, of cash
flows and statement of changes in stockholder's equity of Energy & Engine
Technology Corporation for year ended 31 December 2001. 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 audit.

We conducted our audit in accordance with generally accepted auditing
standards in Canada, which are in substantial agreement with those in the
United States. Those standards require that we plan and perform an audit to
obtain reasonable assurances whether the consolidated financial statements
are free of material mis-statement. 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.

In our opinion, these consolidated financial statements present fairly, in
all material respects, the consolidated results of its operations, cash
flows and changes in stockholder's equity for the year ended 31 December
2001 in accordance with generally accepted accounting principles in the
United States.

These consolidated financial statements have been prepared assuming that
the Companies will require an infusion of capital to sustain themselves.
This requirement for additional capital raises substantial doubt about the
Company's ability to continue as a going concern. The consolidated
financial statements do not include any adjustments that might result from
the outcome of this uncertainty.


Richmond, British Columbia
14 February 2002

                             /S/ Parker & Company
                             Chartered Accountants
















                                     28

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                                 CONSOLIDATED BALANCE SHEET

                                                          December 31, 2002
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                  ASSETS
                                  ------
<S>                                           <C>              <C>
CURRENT ASSETS
--------------
 Cash and cash equivalents                    $   27,817
 Accounts receivable                              40,738
 Inventory                                        16,813
 Prepaid expenses and other current assets         8,407
                                              ----------
     Total Current Assets                                      $   93,775
                                                               ----------

PROPERTY AND EQUIPMENT, Net                                       342,149
----------------------                                         ----------

     TOTAL ASSETS                                              $  435,924
                                                               ==========

              LIABILITIES AND STOCKHOLDERS' DEFICIENCY
              ----------------------------------------

CURRENT LIABILITIES
-------------------
 Accounts payable and accrued expenses        $  295,047
 Accrued expenses, officers                      427,973
 Notes payable, stockholders, net of debt
   discount of $4,853                            225,147
                                              ----------

     TOTAL CURRENT LIABILITIES                                $  948,167
                                                               ---------
STOCKHOLDERS' DEFICIENCY
------------------------
 Common stock, $.001 par value,
  100,000,000 shares authorized,
  23,000,349 shares issued and outstanding        23,001
 Additional paid-in capital                    1,404,405
 Accumulated deficit                          (1,939,649)
                                             -----------

     TOTAL STOCKHOLDERS' DEFICIENCY                             (512,243)
                                                              ----------
     TOTAL LIABILITIES AND STOCKHOLDERS'
          DEFICIENCY                                          $  435,924
                                                              ==========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.

                                  29

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                      CONSOLIDATED STATEMENTS OF OPERATIONS

                             For The Years Ended December 31, 2002 and 2001
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S>                                       <C>                <C>
                                              2002               2001
                                          --------------------------------
NET SALES                                 $    99,257        $       --
---------

COST OF SALES                                  85,023                --
-------------                             -----------        ----------

     GROSS PROFIT                              14,234                --
                                          -----------        ----------
OPERATING EXPENSES
------------------
 Selling, general and administrative
  expenses                                  1,218,306            26,300
 Stock based compensation                     470,628                --
                                          -----------        ----------
     TOTAL OPERATING EXPENSES               1,688,934            26,300
                                          -----------        ----------
     OPERATING LOSS                        (1,674,700)          (26,300)
                                          -----------        ----------
OTHER (EXPENSE) INCOME
----------------------
 Interest income                                   --             4,378
 Interest expense, principally to
  related parties                              (4,289)               --
 Loss on disposal of asset                     (2,000)               --
                                          -----------        ----------
     TOTAL OTHER (EXPENSE) INCOME              (6,289)            4,378
                                          -----------        ----------
     LOSS FROM CONTINUING OPERATIONS       (1,680,989)          (21,922)

     LOSS FROM DISCONTINUED OPERATIONS             --          (193,279)
                                          -----------        ----------
NET LOSS                                  $(1,680,989)       $ (215,201)
                                          ===========        ==========

BASIC AND DILUTED NET LOSS PER COMMON SHARE
-------------------------------------------
 Continuing operations                    $     (0.11)       $    (0.00)
 Discontinued operations                        (0.00)            (0.02)
                                          -----------        ----------
     TOTAL                                $     (0.11)       $    (0.02)
                                          ===========        ==========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING                                15,095,725         8,908,943
                                          ===========        ==========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
                                 30

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

               CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY)

                             For The Years Ended December 31, 2002 and 2001
---------------------------------------------------------------------------

<TABLE>
<CAPTION>

<S>                                      <C>           <C>          <C>            <C>           <C>
                                                Common              Additional
                                         --------------------       Paid-in        Accumulated
                                         Shares        Amount       Capital        Deficit       Total
                                         -------------------------------------------------------------------

BALANCE - January 1, 2001                8,300,000     $  8,300     $  108,700     $  (43,459)   $    73,541
-------

Issuance of common stock in
 connection with private placement          54,286           54        379,946             --        380,000

Cancellation of common stock            (2,000,000)      (2,000)         2,000             --             --

Issuance of common stock in
 connection with acquisition             3,827,621        3,828             --             --          3,828

Net loss                                        --           --             --       (215,201)      (215,201)
                                        ----------     --------     ----------     ----------     ----------

BALANCE - December 31, 2001 (Forward)   10,181,907     $ 10,182     $  490,646     $ (258,660)    $  242,168
                                        ==========     ========     ==========     ==========     ==========

</TABLE>


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









                                      31

                                    ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                          AND SUBSIDIARIES

   CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY), Continued

                            For The Years Ended December 31, 2002 and 2001
--------------------------------------------------------------------------
<TABLE>
<CAPTION>

<S>                                      <C>           <C>          <C>            <C>           <C>
                                                Common              Additional
                                         -----------------------    Paid-in        Accumulated
                                         Shares         Amount      Capital        Deficit       Total
                                         ------------------------------------------------------------------
BALANCE - December 31, 2001 (Forward)    10,181,907     $ 10,182    $  490,646     $ (258,660)   $  242,168
-------

Issuance of common stock to
  consultants                             1,386,625        1,387       201,491             --       202,878

Issuance of common stock to officers
 and employees                            5,675,000        5,675       222,075             --       227,750

Issuance of common stock in
 connection with termination agreement    1,000,000        1,000        39,000             --        40,000

Issuance of common stock in
 connection with notes payable               55,000           55         3,695             --         3,750

Issuance of warrants                             --           --         2,200             --         2,200

Issuance of common stock in
 connection with private placements       4,701,817        4,702       445,298             --       450,000

Net loss                                         --           --            --     (1,680,989)   (1,680,989)
                                         ----------     --------    ----------    -----------    ----------

BALANCE - December 31, 2002              23,000,349     $ 23,001    $1,404,405    $(1,939,649)   $ (512,243)
-------                                  ==========     ========    ==========    ===========    ==========

</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
                                    32

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                             For The Years Ended December 31, 2002 and 2001
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S>                                           <C>              <C>
                                                  2002             2001
                                              -----------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
------------------------------------
Net loss                                      $ (1,680,989)    $   (215,201)
                                              ------------     ------------
 Adjustments to reconcile net loss to net
 cash used in operating activities:
   Depreciation                                     17,488            7,128
   Stock-based compensation                        470,628               --
   Amortization of debt discount                     1,097               --
   Loss on disposal of asset                         2,000           30,309
 Changes in operating assets and
  liabilities:
   Accounts receivable                             (40,738)              70
   Inventory                                       (16,813)              --
   Prepaid expenses and other current assets        (8,407)             627
   Accounts payables and accrued expenses          263,477           30,500
   Accrued expenses, officers                      427,973               --
                                              ------------     ------------
     TOTAL ADJUSTMENTS                           1,116,705           68,634
                                              ------------     ------------
     NET CASH USED IN OPERATING ACTIVITIES        (564,284)        (146,567)
                                              ------------     ------------

CASH FLOWS FROM INVESTING ACTIVITIES
------------------------------------
 Purchases of property and equipment              (191,551)        (182,478)
 Proceeds from disposal of fixed asset               2,000               --
                                              ------------     ------------

     NET CASH USED IN INVESTING ACTIVITIES        (189,551)        (182,478)
                                              ------------     ------------

CASH FLOWS FROM FINANCING ACTIVITIES
------------------------------------
 Proceeds from notes payable, stockholders         230,000               --
 Proceeds from the issuance of common stock        450,000          383,828
                                              ------------     ------------
     NET CASH PROVIDED BY FINANCING
      ACTIVITIES                                   680,000          383,828
                                              ------------     ------------
     NET (DECREASE) INCREASE IN CASH AND
      CASH EQUIVALENTS                             (73,835)          54,783
                                              ------------     ------------
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.

                                    33

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                           CONSOLIDATED STATEMENTS OF CASH FLOWS, Continued

                             For The Years Ended December 31, 2002 and 2001
---------------------------------------------------------------------------
<TABLE>
<CAPTION>

<S>                                           <C>              <C>
                                                   2002            2001
                                              -----------------------------

CASH AND CASH EQUIVALENTS - Beginning         $    101,652     $     46,869
-------------------------                     ------------     ------------

CASH AND CASH EQUIVALENTS - Ending            $     27,817     $    101,652
-------------------------                     ============     ============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
-------------------------------------------------

 Cash paid during the year for:

    Interest                                  $        306     $         --
    Income taxes                              $         --     $         --


</TABLE>

 Non-cash investing and financing activities:

 The Company issued warrants to purchase 60,000 shares of common stock in
 connection with certain notes payable to stockholders.  The fair market
 value of the warrants granted using the Black-Scholes pricing model was
 $2,200 and was recorded as deferred debt discount.  The Company also
 issued 55,000 shares of the Company's common stock in connection with
 notes payable to stockholders.  The fair market value of the common
 stock at issuance date was $3,750 and was also recorded as deferred
 debt discount.



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













                                    34

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------

NOTE 1 - Description of Business, and Basis of Presentation
         --------------------------------------------------

 Organization and Principal Business Activity
 --------------------------------------------
 Energy & Engine Technology Corporation ("EENT" or the "Company") was
 incorporated under the name Bidder Communications, Inc. in Nevada on
 November 16, 1999.  It changed its name from Bidder Communications, Inc
 ("Bidder") to Energy & Engine Technology Corporation on December 5, 2001.

 The consolidated financial statements include the accounts of EENT and its
 wholly owned subsidiaries, Gas Gathering Enterprises, LLC ("Gas Gathering")
 (previously, Southern States Gas Gathering, LLC) and Wind Dancer Aviation
 Services, Inc. ("Wind Dancer") collectively referred to as the "Company."

 The Company, through its wholly owned subsidiaries, is the owner and
 operator of a natural gas gathering system located in Caddo Parish,
 Louisiana, and is a fixed base operator which services general aviation
 aircraft in Pagosa Springs, Colorado.  During 2001, the Company abandoned
 the auctioning software it was developing for the internet in the Bidder
 entity and recorded a $193,279 loss from discontinued operations.

 The Company organized another wholly owned subsidiary Top Gun Marketing,
 Inc. ("Top Gun"), which will be the developer and marketer of the Company's
 AXP 1000 auxiliary power generator for long haul trucks.  Since inception,
 Top Gun has had no operations and activities and there have been no sales of
 the AXP 1000 power generators.


 Acquisition of Assets
 ---------------------
 On September 7, 2001, the Company acquired 100% of the membership interests
 in Southern States Gas Gathering, LLC ("SSGG") for $153,828 in cash and
 common stock, which was recorded as an acquisition of assets.  The assets
 acquired consisted primarily of an inactive 65 mile gas gathering system
 located in the Caddo Pine Island Field, Louisiana.  Trailblazer Production
 Company, LLC ("Trailblazer"), acting as agent for Mees Pierson Unlimited
 ("Seller"), was an unrelated party at the time of the acquisition, and
 received a fee of $50,000 in cash plus common stock from the total purchase
 price for services rendered.  Trailblazer (now inactive) was owned by the
 Company's Chief Executive Officer and Chief Financial Officer at the time
 of the acquisition.

 As part of the acquisition, the Company had also acquired from Seller
 (through its agent, Trailblazer), GlobalSat Technology data.  In exchange
 for this data, the Company issued Trailblazer and Seller an option to
 acquire up to 25% of its interest in SSGG (the "Option") which the Company
 deemed to have a nominal value.   The Seller and Trailblazer had also
 retained a 6% royalty on gross income of SSGG (the "Royalty").  The Company
 also agreed that Trailblazer's and the  Seller's ownership in the Company
 would not dilute for 2 years ("Non Dilution Agreement").  On August 5, 2002,
 the Agreement was amended as follows: 1)  The GlobalSat Technology was

                                   35

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 1 - Description of Business, and Basis of Presentation, continued
         --------------------------------------------------

 returned to the Seller in exchange for the termination of the Option  by
 Seller; 2)  The Royalty was terminated and instead it was agreed that Seller
 would retain a 2% royalty on gross income of SSGG; and 3)  the Non Dilution
 Agreement was terminated in exchange for 1,000,000 shares of the Company's
 common stock valued at $40,000 issued to the Seller (See Note 9).  As of
 December 31, 2001, Trailblazer had relinquished all rights to the Royalty,
 the Non Dilution Agreement and the Option.

 Going Concern and Management's Plan
 -----------------------------------
 As shown in the accompanying consolidated financial statements, the Company
 incurred a net loss of $1,680,989 during the year ended December 31, 2002,
 resulting in an accumulated deficit of $1,939,649. The Company also has a
 working capital deficit of $854,392. These matters raise substantial doubt
 about the Company's ability to continue as a going concern.  Management's
 plans include the raising of cash through the issuance of debt or equity
 (See Note 13) and increasing revenues.  The accompanying consolidated
 financial statements have been prepared on a going concern basis, which
 contemplates the realization of assets and satisfaction of liabilities in
 the normal course of business.  These consolidated financial statements do
 not include any adjustments relating to the recovery of the recorded assets
 or the classification of the liabilities that might be necessary should the
 Company be unable to continue as a going concern.

NOTE 2 - Summary of Significant Accounting Policies
         ------------------------------------------

 Consolidation
 -------------
 The consolidated financial statements include the accounts of EENT and it's
 wholly owned subsidiaries.  All significant intercompany balances and
 transactions have been eliminated in consolidation.

 Revenue Recognition
 -------------------

 Gas Gathering
 Revenue is recognized at the time the product is delivered to customers.

 Fixed Base Operator
 Revenue is recognized at the time that aircraft related services are
 performed or when products are delivered.

 Cash Equivalents
 ----------------
 For the purposes of the statement of cash flows, the Company considers
 all short-term investments with a maturity of three months or less when
 purchased to be cash equivalents.



                                  36

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 2 - Summary of Significant Accounting Policies, continued
         ------------------------------------------

 Inventory
 ---------
 Inventory consists of aviation fuel and is valued at the lower of cost
 or market. Cost is being determined using the first-in/first-out basis.

 Research and Development
 ------------------------
 Research and development costs are expensed as incurred.  Research and
 development costs for the years ended December 31, 2002 and 2001 were
 $110,143 and $-0-, respectively and are included in selling, general
 and administrative expenses.

 Income Taxes
 ------------
 The Company accounts for income taxes using the liability method, which
 requires the determination of deferred tax assets and liabilities based
 on the differences between the financial and tax bases of assets and
 liabilities using enacted tax rates in effect for the year in which
 differences are expected to reverse. Deferred tax assets are adjusted by
 a valuation allowance, if, based on the weight of available evidence, it
 is more likely than not that some portion or all of the deferred tax
 assets will not be realized.

 Depreciation
 ------------
 Depreciation of machinery and equipment, furniture and fixtures and gas
 gathering equipment is computed on the straight-line method at rates
 adequate to allocate the cost of applicable assets over their expected
 useful lives.

 Net Loss Per Share
 ------------------
 During the year ended December 31, 2001, the Company adopted the provision
 of Statements of Financial Accounting Standards ("SFAS") No. 128, "Earnings
 per Share".  SFAS No. 128 eliminates the presentation of primary and fully
 dilutive earnings per share ("EPS") and requires presentation of basic and
 diluted EPS.  Basic EPS is computed by dividing income or (loss) available
 to common stockholders by the weighted-average number of common shares
 outstanding for the period.  Diluted EPS is based on the weighted-average
 number of shares of common stock and common stock equivalents outstanding.
 Common stock equivalents have been excluded from the weighted-average
 shares for 2002 and 2001 as inclusion is anti-dilutive.  Potentially
 dilutive securities (warrants) of 460,000 and -0- are outstanding at
 December 31, 2002 and 2001, respectively.

 Use of Estimates
 ----------------
 The preparation of consolidated financial statements in conformity with
 accounting principles generally accepted in the United States of America
 requires management to make estimates and assumptions that affect the

                                   37

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 2 - Summary of Significant Accounting Policies, continued
         ------------------------------------------

 reported amounts of assets and liabilities and disclosure of contingent
 assets and liabilities at the date of the consolidated financial
 statements and the reported amounts of revenues and expenses during the
 reporting period.  Actual results could differ from those estimates.

 Reclassification
 ----------------
 Certain prior year amounts have been reclassified to conform with the
 current year's presentation.

 Stock-Based Compensation
 ------------------------
 In October 1995, SFAS No. 123, "Accounting for Stock-Based Compensation"
 was issued. SFAS 123 prescribes accounting and reporting standards for
 all stock-based compensation plans, including employee stock options,
 restricted stock, employee stock purchase plans and stock appreciation
 rights.  SFAS 123 requires compensation expense to be recorded (i) using
 the new fair value method or (ii) using the existing accounting rules
 prescribed by Accounting Principles Board Opinion No. 25, "Accounting for
 Stock Issued to Employees" ("APB 25") and related interpretations with
 pro forma disclosure of what net income and earnings per share would have
 been had the Company adopted the new fair value method.  The Company
 intends to continue to account for its stock based compensation plans in
 accordance with the provisions of APB 25.

 Business Segment
 ----------------
 During the year ended December 31, 2002, the Company adopted SFAS No. 131,
 "Disclosures About Segments of an Enterprise and Related Information",
 which supersedes SFAS No. 14, "Financial Reporting for Segments of A
 Business Enterprise".  SFAS No. 131 establishes standards for the way that
 public enterprises report information about operating segments in annual
 financial statements and requires reporting of selected information about
 operating segments in interim financial statements regarding products and
 services, geographic areas and major customers.  SFAS No. 131 defines
 operating segments as components of an enterprise about which separate
 financial information is available that is evaluated regularly by the
 chief operating decision maker in deciding how to allocate resources and
 in assessing performance. The Company has determined that under SFAS No.
 131, it operates in two segments (See Note 12). The Company's customers
 and operations are within the United States.

 New Accounting Pronouncements
 -----------------------------
 In June 2001, the Financial Accounting Standards Board ("FASB") issued SFAS
 No. 141 ("SFAS 141"), "Accounting for Business Combinations" and SFAS No.
 142 ("SFAS 142"), "Accounting for Goodwill and Other Intangible Assets".
 SFAS 141 requires that all business combinations be accounted for using the
 purchase method of accounting and prohibits the pooling-of-interests method
 of accounting for business combinations initiated after June 30, 2001.

                                   38

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 2 - Summary of Significant Accounting Policies, continued
         ------------------------------------------

 According to SFAS 142, goodwill, which arises from business combinations
 after June 30, 2001, cannot be amortized.  In addition, SFAS 142 requires
 the discontinuation of goodwill amortization and the amortization of
 intangible assets with indeterminate lives effective the date the Company
 adopts the statement.

 The Company adopted SFAS 141 and SFAS 142 on July 1, 2001.  The adoption of
 SFAS 141 and SFAS 142 did not have an impact on the consolidated financial
 statements.

 In October 2001, the FASB issued SFAS No. 144 ("SFAS 144"), "Accounting for
 the Impairment or Disposal of Long-Lived Assets," which supersedes SFAS No.
 121 ("SFAS 121"), "Accounting for the Impairment of Long-Lived Assets and
 for Long-Lived Assets to be Disposed of" and certain provisions of APB
 Opinion No. 30, "Reporting Results of Operations - Reporting the Effects
 of Disposal of a Segment of a Business, and Extraordinary, Unusual and
 Infrequently Occurring Events and Transactions." SFAS 144 requires that
 long-lived assets to be disposed of by sale, including discontinued
 operations, be measured at the lower of the carrying amount or fair value,
 less cost to sell, whether reported in continuing operations or in
 discontinued operations.  SFAS 144 also broadens the reporting requirements
 of discontinued operations to include all components of an entity that have
 operations and cash flows that can be clearly distinguished, operationally
 and for financial reporting purposes, from the rest of the entity.  The
 provisions of SFAS 144 have been adopted by the Company as of January 1,
 2002.  The adoption of SFAS 144 did not have an impact on the consolidated
 financial statements.

 In April 2002, the FASB issued SFAS No. 145 ("SFAS 145"), "Rescission of
 FASB Statement No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
 Technical Corrections."  The rescission of SFAS No. 4, "Reporting Gains and
 Losses from Extinguishments", and SFAS No. 64, "Extinguishments of Debt
 Made to Satisfy Sinking Fund Requirements", which amended SFAS No. 4
 affects income statement classification of gains and losses from
 extinguishment of debt.  The Company adopted SFAS 145 on April 1, 2002 and
 the adoption did not have an impact on the consolidated financial
 statements.

 In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs
 Associated with Exit of Disposal Activities" ("SFAS 146").  SFAS 146
 addresses financial accounting and reporting for costs associated with exit
 or disposal activities and nullified Emerging Issues Task Force Issue No
 94-3, "Liability Recognition for Certain Employee Termination Benefits and
 Other Costs to Exit an Activity (Including Certain Costs Incurred in a
 Restructuring)".  "SFAS 146 requires that a liability for a cost associated
 with an exit or disposal activity to be recognized when the liability is
 incurred.  A fundamental conclusion reached by the FASB in this statement
 is that an entity's commitment to a plan, by itself, does not create a
 present obligation to others that meets that definition of a liability.
 SFAS 146 also establishes that fair value is the objective for initial

                                  39

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 2 - Summary of Significant Accounting Policies, continued
         ------------------------------------------

 measurement of the liability.  The provisions of this statement are
 effective for exit or disposal activities that are initiated after December
 31, 2002, with early application encouraged.  The adoption of SFAS 146 is
 not expected to have an impact on the consolidated financial statements.

 On December 31, 2002, the FASB issued SFAS No. 148 ("SFAS 148"), Accounting
 for Stock-Based Compensation - Transition and Disclosure.  SFAS 148 amends
 SFAS 123, Accounting for Stock-Based Compensation, to provide alternative
 methods of transition to SFAS 123's fair value method of accounting for
 stock-based employee compensation.  SFAS 148 also amends the disclosure
 provisions of SFAS 123 and APB Opinion No. 28, Interim Financial Reporting,
 to require disclosure in the summary of significant accounting policies of
 the effects of an entity's accounting policy with respect to stock-based
 employee compensation on reported net income and earnings per share in
 annual and interim financial statements.  While the statement does not
 amend SFAS 123 to require companies to account for employee stock options
 using the fair value method, the disclosure provisions of SFAS 148 are
 applicable to all companies with stock-based employee compensation,
 regardless of whether they account for that compensation using the fair
 value method of SFAS 123, or the intrinsic value method of APB Opinion 25.
 The Company will continue to account for stock-based compensation according
 to APB Opinion 25, while its adoption of SFAS 148 requires the Company to
 provide prominent disclosures about the effect of SFAS 123 on reported
 income and will require the Company to disclose these effects in the
 interim financial statements commencing with the quarter ending March 31,
 2003.  The Company does not expect the adoption of SFAS 148 to have a
 significant impact on its consolidated financial position or results of
 operations.

 In November 2002, the FASB issued Interpretation No. 45, "Guarantor's
 Accounting and Disclosure Requirements for Guarantees, Including Indirect
 Guarantees of Indebtedness of Others" (" FIN 45"). FIN 45 requires a
 company, at the time it issues a guarantee, to recognize an initial
 liability for the fair value of obligations assumed under the guarantee
 and elaborates on existing disclosure requirements related to guarantees
 and warranties. The initial recognition requirements of FIN 45 are
 effective for guarantees issued or modified after December 31, 2002.
 Adoption of the disclosure requirements are effective for interim and
 annual periods ending after December 15, 2002.  The Company does not
 expect the adoption of FIN 45 to have an impact on its consolidated
 financial position or results of operations.

 In January 2003, the FASB issued FASB Interpretation No. 46,"Consolidation
 of Variable Interest Entities, and an Interpretation of ARB No. 51 ("FIN
 46").  FIN 46 requires certain variable interest entities to be consolidated
 by the primary beneficiary of the entity if the equity investors in the
 entity do not have the characteristics of a controlling financial interest
 or do not have sufficient equity at risk for the entity to finance its
 activities without additional subordinated financial support from other
 parties. FIN 46 is effective for all new variable interest entities created

                                40

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 2 - Summary of Significant Accounting Policies, continued
         ------------------------------------------

 or acquired after January 31, 2003. For variable interest entities created
 or acquired prior to February 1, 2003, the provisions of FIN 46 must be
 applied for the first interim or annual period beginning after June 15,
 2003. The Company does not expect the adoption of FIN 46 to have an impact
 on its consolidated financial position or results of operations.

NOTE 3 - Property and Equipment
         ----------------------

 Property and equipment at December 31, 2002 consists of the following:

<TABLE>
<CAPTION>

<S>                                     <C>                  <C>
                                                             Estimated
                                                             Useful Lives
                                        ---------------------------------
 Machinery and equipment                $    88,500           5 years
 Gas gathering equipment                    273,265          20 years
 Furniture and fixtures                       5,000           5 years
                                        -----------
                                            366,765
 Less:  accumulated depreciation            (24,616)
                                        -----------

     Property and Equipment, Net        $   342,149
                                        ===========

</TABLE>

 Depreciation expense for the year ended December 31, 2002 and 2001 was
 $17,488 and $7,128, respectively.

 On December 5, 2002 the Company purchased property and equipment for
 $92,500 from the Board of County Commissioners of Archuleta County,
 Colorado in connection with the operations of Wind Dancer as a fixed base
 operator servicing general aviation aircraft.

NOTE 4 - Notes Payable, Stockholders
         ---------------------------

 On July 9, 2002 the Company entered into a $50,000 note payable agreement
 with a stockholder which accrues interest at 7% and is due July 9, 2003.
 In the event of default on the maturity date, the Company would be required
 to satisfy the note by issuing shares of the Company's common stock by
 dividing the principal balance due by 50% of the average ten day closing
 price of the Company's common stock preceding the maturity date.



                                    41

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 4 - Notes Payable, Stockholders, continued
         ---------------------------

 On November 14, 2002, as part of a private placement offering (See Note 9)
 a stockholder purchased a one quarter (1/4) unit for $5,000.  This one
 quarter (1/4) unit consists of a $5,000 note payable which accrues interest
 at 10% and is due on November 14, 2003 as well as 5,000 shares of the
 Company's common stock plus 5,000 warrants to purchase the Company's common
 stock at an exercise price of $0.10 per warrant exercisable through November
 14, 2003 plus 5,000 warrants to purchase the Company's common stock at an
 exercise price of $0.25 per warrant exercisable through November 14, 2004
 (See Note 11).

 On November 29, 2002 as part of an investment agreement, the Company entered
 into a $25,000 note payable agreement with a stockholder which accrues
 interest and 10% and is due in monthly installments through December 1,
 2003.  In the event of default on the monthly installments through the
 maturity date, the Company would be required to satisfy the note by
 recording a lien on the assets of Gas Gathering and its gas gathering system
 and assign all proceeds from gross revenues realized from the sale of gas
 and liquids from these operations until the note and all interest and
 default interest was paid in full.

 In connection with this investment agreement the Company issued 50,000
 warrants to purchase the Company's common stock at an exercise price of
 $0.10 per warrant exercisable through December 1, 2005 (See Note 11).
 Also in connection with this investment agreement the Company issued
 50,000 shares of the Company's common stock valued at $3,500 to the
 stockholder for consulting services (See Note 9).

 On December 3, 2002 the Company entered into a $150,000 note payable
 agreement with a stockholder which accrues interest at 10% and is due June
 3, 2003.  In connection with this note the Company issued 50,000 shares of
 the Company's common stock and it is secured by a lien on Wind Dancer's
 assets. (See Note 9)

 The fair market value of the 10,000 warrants issued on November 14, 2002
 and the 50,000 warrants issued on November 29, 2002 approximated $2,200
 estimated at the date of grant using the Black-Scholes option-pricing
 model.  The fair market value of the 5,000 shares of the Company's common
 stock issued on November 14, 2002 and the 50,000 shares of the Company's
 common stock issued on December 3, 2002 approximated $3,750 estimated
 based on the average trading value of the stock.  These amounts were
 recorded as increases to both additional paid in capital and deferred debt
 discount.  The deferred debt discount will be amortized to interest expense
 over the life of the notes.  Interest expense relating to this deferred debt
 discount for the year ended December 31, 2002 was $1,097.

NOTE 5 - Accrued Expenses, Officers
         --------------------------

 Accrued expenses officers represents unpaid payroll, bonuses and
 unreimbursed business expenses to three (3) officers of the Company.  These

                                     42

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 5 - Accrued Expenses, Officers, continued
         --------------------------

 amounts are non-interest bearing and have no definite repayment terms.  As
 of December 31, 2002 the outstanding balance in accrued expenses officers was
 $427,973.

NOTE 6 - Commitments and Contingencies
         -----------------------------

 Operating Lease
 ---------------
 On September 11, 2002 the Company entered into a noncancelable operating
 lease for office space in Shreveport Louisiana, which commenced on October 1,
 2002 and expires on September 30, 2005.

 On October 15, 2002 the Company entered into a noncancelable operating lease
 for an aircraft hanger located at the Archuleta County Airport - Stevens
 Field in Colorado.  This lease commenced on December 5, 2002 and expires on
 December 5, 2012.  Annual rent is $9,600 for the first five (5) years of the
 lease term and increases 18% per year for the remaining five (5) years not
 exceeding annual rent of $22,000.  The Company has an option to renew the
 lease at the end of the lease term for an additional 10 year period with
 annual rent to be determined based on the appraised value at that time.
 Under the terms of this lease the Company must also pay to the landlord a
 fuel flow fee of $.05 per gallon, subject to increases, of aviation fuel
 sold by the Company as well as an aircraft parking fee of 70% of all
 aircraft parking fees collected by the Company.

 The Company also rents office space for its corporate headquarter in Plano,
 Texas.  This rent is on a month-to-month basis without a formal lease
 agreement with a monthly rent expense of $2,000.

 Future minimum rental payments under the above noncancelable operating
 leases as of December 31, 2002 are as follows:

<TABLE>
<CAPTION>
               <S>                             <C>
               For the Year Ending
                  December 31,                 Amount
               ------------------------------------------
                     2003                      $   15,828
                     2004                          15,828
                     2005                          14,271
                     2006                           9,744
                     2007                          11,498
                  Thereafter                       90,601
                                               ----------
                    Total                      $  157,770
                                               ==========
</TABLE>


                                   43

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 6 - Commitments and Contingencies, continued
         -----------------------------

 Rent expense for the years ended December 31, 2002 and 2001 amounted to
 $19,664 and $13,513, respectively.

 Legal Settlement
 ----------------
 Based on a final judgment and subsequent settlement agreement against the
 Company dated January 15, 2003, the Company is obligated to pay $18,500 to
 a former consultant to the Company for services provided.  The amount due
 of $18,500 is included in accounts payable and accrued expenses at December
 31, 2002.

 Consulting Agreement
 --------------------
 On November 19, 2002 the Company entered into an agreement with GLM
 Partners ("GLM") for financial advisory services which expires on May 19,
 2003.  Based on this agreement, the Company will pay GLM a results-oriented
 consulting fee based on the increase in the Company's stock price.  The
 Company will pay this fee by issuing to GLM up to 800,000 shares of the
 Company's common stock and up to 300,000 options to purchase the common
 stock at an exercise price at $0.01 in various stages based on the
 Company's stock price as defined in the agreement.  On January 21, 2003,
 the Company issued 200,000 shares relating to this consulting agreement
 (See Note 13).

 Issuance of Common Stock
 ------------------------
 On August 29, 2002, the Company entered into an agreement with a consultant
 whereby the Company would issue 150,000 shares of the Company's common
 stock when a working prototype of the AXP 100 auxiliary power generator is
 tested and approved by management.  As of December 31, 2002, these shares
 have not been earned or issued.

NOTE 7 - Economic Dependency
         -------------------

 Major Customers
 ---------------
 Gas Gathering sells a substantial portion of its product to one customer.
 During the year ended December 31, 2002, sales to this customer totaled
 $71,148 (72%) of net sales.  As of December 31, 2002, the amount due from
 this customer included in accounts receivable was $32,265.

 Major Suppliers
 ---------------
 Gas Gathering purchased a substantial portion of its product from three
 suppliers.  During the year ended December 31, 2002, purchases from these
 suppliers were $26,065 (40%), $11,381 (18%), and $11,176 (17%) of cost of
 sales, respectively.  At December 31, 2002, total amount due these
 suppliers included in accounts payable was $21,611.


                                44

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 7 - Economic Dependency, continued
         -------------------

 Geographic Dependency
 ---------------------
 Gas Gathering revenue is generated in Caddo Parish, Louisiana.  The
 Company's revenue is limited to the amount of product which can be
 extracted from this area.

NOTE 8 - Income Taxes
         ------------

 The Company recognized deferred tax assets and liabilities for the future
 tax consequences attributable to differences between the financial
 statement carrying amount of existing assets and liabilities and their
 respective tax bases.  In addition, the Company also recognizes deferred
 tax assets for future tax benefits, such as net operating loss ("NOL")
 carryforwards, to the extent that realization of such benefits is more
 likely than not.

 The components of the net deferred tax assets as of December 31, 2002 is as
 follows:

<TABLE>
<CAPTION>

  <S>                                      <C>
                                              2002
                                           -----------
  Accrued expenses                         $   114,000
  NOL carryforwards                            540,000
                                           -----------

     Total deferred tax asset                  654,000

  Valuation allowance                         (654,000)
                                           -----------
  Net Deferred Tax Asset                   $        --
                                           ===========

</TABLE>

 The valuation allowance increased $654,000 for the year ended December
 31, 2002.

 At December 31, 2002, the Company had available NOL carryforwards for
 income tax purposes of approximately $1,589,000, which expires at various
 dates through 2022.  The Company will not be able to utilize net operating
 losses which occurred prior to the acquisition of SSGG pursuant to the
 limitations described in Section 382 of the Internal Revenue Service Code.

 A reconciliation of the expected statutory tax rate and the effective
 rate is as follows:

                                 45

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 8 - Income Taxes, continued
         ------------

<TABLE>
<CAPTION>

<S>                                   <C>                <C>

                                      2002               2001
                                      ----------------------------

   Expected statutory rate            34.0%              34.0%
   NOL without tax benefit           (34.0)             (34.0)
                                     -----              -----

     Total income taxes                 --%                --%
                                     =====              =====
</TABLE>

NOTE 9 - Common Stock
         ------------

 On June 26, 2001, in connection with a private placement offering, the
 Company sold 54,286 shares of common stock to an investor at $7.00 per
 share or $380,000.

 On September 7, 2001, the Company issued 3,827,621 shares of common stock
 in connection with the acquisition of SSGG (See Note 1).  Furthermore, in
 connection with the transaction on September 7, 2001 the founding
 shareholders of Bidder surrendered 2,000,000 shares of the common stock
 back to the Company.

 On January 10, 2002, Company issued 445,000 shares of common stock
 valued at $138,400 to consultants for services provided.

 On April 25, 2002, the Company issued 142,650 shares of common stock
 valued at $17,868 to consultants for services provided.

 On April 26, 2002, the Company issued 35,000 shares of common stock
 valued at $4,550 to a consultant for services provided.

 On May 24, 2002, the Company issued 500,000 shares of common stock
 valued at $30,000 to a consultant for services provided.

 On June 28, 2002, August 13, 2002, September 29, 2002 and December 23,
 2002 in connection with private placement offerings, the Company sold
 3,500,000 shares of common stock to an investor at $0.10 per share or
 an aggregate of $350,000.  In connection with these private offerings
 the Company issued warrants to purchase an aggregate of 300,000 shares
 of the Company's common stock with an exercise price of $0.25 expiring
 through January 16, 2005 (See note 11).  Also in connection with these
 offerings the Company and the investor entered into an agreement whereby
 the investor's 3,500,000 share common stock ownership in the Company at

                                  46

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 9 - Common Stock, continued
         ------------

 December 31, 2002 is non-dilutable by common stock issued by the Company
 beyond 20,000,000 shares, or 17.5%.  At December 31, 2002, the amount of
 shares deemed issued relating to the non-dilution agreement is 201,817.
 The non-dilution agreement was originally effective until December 12,
 2004 and does not include stock issuances over 20,000,000 shares which
 are attributable to shares issued in a merger or acquisition that
 increases value and is approved by a majority of the stockholders of the
 Company.  The non-dilution agreement has subsequently been extended to
 January 17, 2005 and the non-dilution percentage has increased to 20%
 based on additional investments (See note 13).

 On August 13, 2002, the Company issued 13,975 shares of common stock
 valued at $559 to a consultant for services provided.

 On August 13, 2002, in connection with a private placement offering, the
 Company sold 1,000,000 shares of common stock to an investor at $0.10 per
 share or $100,000.

 In connection with this private placement offering the Company issued
 warrants to purchase 100,000 shares of the Company's common stock with an
 exercise price of $0.25 expiring on August 13, 2004 (See note 11).

 On August 29, 2002, the Company issued 5,650,000 shares of common stock
 valued at $226,000 to officers and employees for services provided.

 On August 29, 2002, the Company issued 1,000,000 shares of common stock
 valued at $40,000 in connection with a termination agreement (See Note 1).

 On August 29, 2002, the Company issued 100,000 shares of common stock
 valued at $4,000 to consultants for services provided.

 On October 10, 2002, the Company issued 100,000 shares of common stock
 valued at $4,000 to consultants for services provided.

 On November 14, 2002 as part of a private placement (See Note 4) an
 investor purchased a one quarter (1/4) unit for $5,000.  This one quarter
 (1/4) unit consists of a $5,000 note payable, 5,000 shares of the Company's
 common stock, 5,000 warrants to purchase the Company's common stock at an
 exercise price of $0.10 per warrant exercisable through November 14, 2003
 and 5,000 warrants to purchase the Company's common stock at an exercise
 price of $0.25 per warrant exercisable through November 14, 2004 (See Note
 11).

 On November 29, 2002 the Company issued 50,000 shares of the Company's
 common stock valued at $3,500 to a stockholder for consulting services as
 part of an investment agreement (See Note 3), consisting of a $25,000 note
 payable and 50,000 warrants to purchase the Company's common stock at an
 exercise price of $0.10 per warrant exercisable through December 1, 2005
 (See Note 11).

                                   47

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 9 - Common Stock, continued
         ------------

 On December 3, 2002, the Company issued 25,000 shares of common stock
 valued at $1,750 to an employee for services provided.

 On December 3, 2002 the Company entered into a $150,000 note payable
 agreement with an investor which accrues interest at 10% and is due June 3,
 2003.  In connection with this note the Company issued 50,000 shares of the
 Company's common stock valued at $3,500. (See Note 4).

NOTE 10 - Consulting Service Plan
          -----------------------

 Effective as of January 10, 2002 the Company adopted a 2002 Consulting
 Service Plan ("2002 Plan") whereby 1,000,000 shares of the Company's common
 stock may be subject to stock awards.  Effective as of December 2, 2002 the
 Company adopted a 2002-2003 Consulting Service Plan ("2002-2003 Plan")
 whereby an additional 1,000,000 shares of the Company's common stock may be
 subject to stock awards.  The purpose of the 2002 Plan and the 2002-2003
 Plan is to advance interests of the Company by rewarding employees,
 directors, former directors, contractors and consultants to the Company (See
 Note 9).  As of December 31, 2002, 1,000,000 and 25,000 shares of the
 Company's common stock have been issued under the 2002  Plan and the
 2002-2003 Plan, respectively.

NOTE 11 - Warrants
          --------

 On August 13, 2002, September 29, 2002 and December 17, 2002, the Company
 issued warrants to an investor to purchase an aggregate of 300,000 shares
 of the Company's common stock exercisable at $0.25 in connection with a
 common stock offering (See Note 9).  These warrants vest immediately and
 250,000 of these warrants expire August 13, 2004 and 50,000 of these
 warrants expire January 16, 2005.

 On August 13, 2002, the Company issued warrants to an investor to purchase
 100,000 shares of the Company's common stock exercisable at $0.25 in
 connection with a private placement offering (See Note 9).  These warrants
 vest immediately and expire August 13, 2004.

 On November 14, 2002, the Company issued warrants to purchase 10,000 shares
 of the Company's common stock in connection with a unit offering (See Note
 4).  5,000 of these warrants are exercisable at $0.10 and expire November
 14, 2003 and 5,000 of these warrants are exercisable at $0.25 and expire
 November 14, 2004.

 On November 29, 2002 the Company issued warrants to purchase 50,000 shares
 of the Company's common stock in connection with a note payable (See Note
 4).  These warrants are exercisable at $0.10 and expire December 1, 2005.

                                  48




                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 11 - Warrants, continued
          --------

 Transactions involving warrants are summarized as follows:

<TABLE>
<CAPTION>
 <S>                                <C>                  <C>
                                    Number Of          Weighted Average
                                    Warrants           Exercise Price
                                    -----------------------------------
 Balance - January 1, 2002                 --                        --

 Warrants issued during the year      460,000                     $0.23
                                    ---------
 Balance - December 31, 2002          460,000                     $0.23
                                    =========
</TABLE>

 There were 460,000 warrants exercisable at December 31, 2002.

NOTE 12 - Segment Reporting
          -----------------

 The accounting policies of the segments are disclosed in the summary of
 significant accounting policies.  There are no intersegment sales.  The
 Company evaluates performance based on income or loss from operations.

 Summarized financial information concerning the Company's reportable
 segments is as follows:

<TABLE>
<CAPTION>
<S>                      <C>          <C>         <C>            <C>
                            Gas          Wind         General
                         Gathering      Dancer      Corporation      Total
                         ---------------------------------------------------
 For the Year Ended
  December 31, 2002

 Revenue                 $  84,327    $  14,930   $        --    $    99,257
                         =========    =========   ===========    ===========
 Operating loss          $(184,438)   $ (14,384)  $(1,475,878)   $(1,674,700)
                         =========    =========   ===========    ===========
 Loss from continuing
  operations             $(184,438)   $ (16,284)  $(1,480,267)   $(1,680,989)
                         =========    =========   ===========    ===========
 Capital Expenditures    $  94,051    $  92,500   $     5,000    $   191,551
                         =========    =========   ===========    ===========
 Total identifiable assets
  at December 31, 2002   $ 286,234    $ 129,181   $    20,509    $   435,924
                         =========    =========   ===========    ===========
</TABLE>

                                    49

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 12 - Segment Reporting, continued
          -----------------

<TABLE>
<CAPTION>

<S>                      <C>          <C>         <C>            <C>
                            Gas          Wind         General
                         Gathering      Dancer      Corporation      Total
                         ---------------------------------------------------

 For the Year Ended
  December 31, 2001

 Revenue                 $      --    $      --   $        --    $        --
                         =========    =========   ===========    ===========
 Operating loss          $ (12,787)   $      --   $   (13,513)   $   (26,300)
                         =========    =========   ===========    ===========
 Loss from continuing
  operations             $ (12,787)   $      --   $    (9,135)   $   (21,922)
                         =========    =========   ===========    ===========
 Capital Expenditures    $ 179,214    $      --   $        --    $   179,214
                         =========    =========   ===========    ===========
 Total identifiable assets
  at December 31, 2001   $ 172,086    $      --   $   101,652    $   273,738
                         =========    =========   ===========    ===========

</TABLE>

NOTE 13 - Subsequent Events
          -----------------

A.  Equity Transactions
    -------------------
    On January 17, 2003, in connection with a private offering, the Company
    sold 500,000 shares of common stock to an investor at $0.10 per share or
    $50,000.  The Company also issued warrants to purchase 50,000 shares of
    the Company's common stock with an exercise price of $0.25 expiring on
    January 16, 2005.  In connection with a non-dilution provision with this
    investor (See Note 9), the investors 4,000,000, share ownership in the
    Company is now non-dilutable for common stock issued by the Company
    beyond 20,000,000, or 20%.  This non-dilution provision is effective
    until January 17, 2005 and does not include shares issued in a merger or
    acquisition that increases value and is approved by a majority of the
    stockholders of the Company.  On March 21, 2003 382,942 shares of common
    stock were issued to this investor in connection with the non-dilution
    provision.

    On January 21, 2003, the Company issued 260,000 shares of common stock
    valued at $28,600 to consultants for services to be provided.

    On January 21, 2003, the Company issued 500,000 shares of common stock
    valued at $45,000 to employees for services to be provided.

                                   50

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 13 - Subsequent Events, continued
          -----------------

    On January 22, 2003, in connection with a private offering, the Company
    sold 100,000 shares of common stock to an investor at $0.20 per share or
    $20,000.  The Company also issued an additional 100,000 shares of common
    stock valued at $11,000 to this investor for consulting services to be
    provided.

    On March 5, 2003, the Company issued 50,000 shares of common stock
    valued at $3,000 to consultants for services to be provided.

    On March 13, 2003, the Company issued 25,000 shares of common stock
    valued at $1,750 to an employee for services to be provided.

    On April 2, 2003, the Company issued 25,000 shares of common stock
    valued at $1,500 to a consultant for services to be provided.

B.  Notes Payable
    -------------
    On January 21, 2003 as part of a private placement an investor
    purchased one unit for $25,000. This unit consists of a $25,000 note
    payable which accrues interest at 10% and is due on January 7, 2004 as
    well as 25,000 shares of the Company's common stock plus 25,000
    warrants to purchase the Company's common stock at an exercise price of
    $0.10 per warrant exercisable through January 7, 2004 plus 25,000
    warrants to purchase the Company's common stock at an exercise price of
    $0.25 per warrant exercisable through January 7, 2005.

    On March 14, 2003 the Company issued a non-interest bearing note payable
    for $50,000.  This note payable will be repaid to the stockholder upon a
    potential funding by an investment company or if such funding does not
    take place then the note will be repaid from any potential future net
    profits from the Company's sale of AXP 1000 power generators.  In
    connection with this note the Company also issued 617,058 shares of the
    Company's common stock.

    On March 11, 2003 and March 13, 2003 as part of investment agreements,
    the Company entered into two note payable agreements with a stockholder
    aggregating $45,000 which accrues interest at 10% and is due in monthly
    installments through April, 2004.  In the event of default on the
    monthly installments through the maturity date, the Company would be
    required to satisfy the note by recording a lien on the assets of Gas
    Gathering and its gas gathering system and shall assign all proceeds
    from gross revenues realized from the sale of gas and liquids from these
    operations until the note and all interest and default interest was paid
    in full.  In connection with these investment agreements the Company
    issued 110,000 warrants to purchase the Company's common stock at an
    exercise price of $0.10 per warrant exercisable through March 13, 2006.
    Also in connection with these investment agreements the Company issued
    an aggregate of 140,000 shares of the Company's common stock to the
    shareholder for consulting services.


                                 51

                                     ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                           AND SUBSIDIARIES

                                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 13 - Subsequent Events, continued
          -----------------

C.  Securities and Exchange Commission Matter
    -----------------------------------------
    On February 10, 2003, the Securities and Exchange Commission ("SEC")
    Staff ("Staff") wrote the Company's counsel and indicated that it was
    prepared to recommend to the SEC that it institute proceedings against
    the Company and Mr. Willard McAndrew, Chairman, President, Chief
    Executive Officer and Director ("Mr. McAndrew") for violations of
    Sections 5(a) and 5(c) of the Securities Act of 1933.  The focus of
    the investigation is on the Company's issuance of certain shares of
    its common stock in January 2002 pursuant to an S-8 registration
    statement.  Pursuant to the Company's Counsel, the staff of the SEC
    agreed instead to recommend that the SEC accept an offer from the
    Company to accept a cease and desist order in settlement of
    administrative proceedings and not to institute proceedings against
    Mr. McAndrew.  There can be no guarantees however that the SEC will
    accept the Staffs recommendation.  These financial statements do not
    include any adjustments that might result should the SEC institute
    proceedings against the Company.

D.  Letter of Intent
    ----------------
    On March 7, 2003, the Company entered into a letter of intent which
    was subsequently amended on April 3, 2003, whereby the Company would
    sell 100% of the membership interests of Gas Gathering for $500,000 to
    American West Resources ("American West").  Based on the letter of
    intent the Company would retain a 2% net profit interest in Gas
    Gathering if the closing is within 30 days of March 7, 2003, or an 8%
    net profit interest if the closing is 31 to 90 days from the closing
    date.  The President, Chief Executive Officer and majority shareholder
    of America West is the father in law of the Company's President and
    Chief Executive Officer.  There can be no assurance that this sale will
    take place.

E.  Equity Credit Line
    ------------------
    On April 7, 2003, the Company executed a term sheet with Cornell
    Capital Partners, LP ("Cornell") for a proposed $3,500,000 equity credit
    line.  Under the terms of the agreement, Cornell shall commit to
    purchase up to $3,500,000 of the Company's common stock over a 24 month
    period after an effective registration of the shares has been complete.
    The purchase price of the common stock shall be 96% of the market price
    as defined in the agreement.  At closing the Company will be subject to
    a 4% commitment fee which is convertible into the Company's common stock
    plus cash compensation equal to 6% of the gross proceeds of each
    purchase.  There can be no assurances that this equity credit line will
    be closed.





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