---

UNITED STATESSECURITIES
AND EXCHANGE COMMISSIONWashington, D.C. 20549

Form 10-Q

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

For the Quarterly Period Ended September 30,
2008

OR

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

For the transition period from ______________to
______________

Commission File No. **000-51302**

MADISON EXPLORATIONS
INC.(Exact name of small business issuer as specified in its
charter)

|Nevada                          | 7389                         | Pending            
|------------------------------- | ---------------------------- | -------------------
|(State or other jurisdiction of | (Primary Standard Industrial | (I.R.S. Employer   
|incorporation or organization)  | Classification Code Number)  | Identification No.)

**1100 E. 29th St., Suite 153, North Vancouver,
British Columbia, Canada,V7K 1C2**(Address of
principal executive offices)

**(206) 202-4519**(Registrants
telephone number, including area code)

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, or a
non-accelerated filer. See definition of accelerated filer and large
accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ]
Accelerated filer [ ][X] Non-accelerated filer[X] Smaller reporting
company

Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes[X] No[
]

The number of shares of Common
Stock, $0.001 par value, of the registrant outstanding at November 11, 2008
was113,020,000.

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TABLE OF CONTENTS

|                                                                           | Page
|-------------------------------------------------------------------------- | ----
|PART I.                                                                    | 3   
|Item 1. Financial Statements.                                              | 3   
|Item 2. Managements
      Discussion and Analysis or Plan of Operations   | 4   
|Item 3. Quantitative and Qualitative Disclosures
      About Market Risks  | 10  
|Item 4. Controls and Procedures.                                           | 10  
|PART II.                                                                   | 11  
|Item 1. Legal Proceedings.                                                 | 11  
|Item 2. Unregistered Sales of Equity Securities
      and Use of Proceeds. | 11  
|Item 3. Defaults Upon Senior
      Securities.                             | 11  
|Item 4. Submission of Matter to Vote of
      Security Holders.            | 11  
|Item 5. Other Information.                                                 | 11  
|Item 6. Exhibits.                                                          | 11  
|SIGNATURES                                                                 | 12  

2

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Statement Regarding Forward-Looking Statements

This Form 10-Q contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended
Section 21E of the Securities Exchanged Act of 193, as amended, which are
intended to be covered by the safe harbors created thereby. The statements
contained in this report on Form 10-Q that are not purely historical are
forward-looking statements within the meaning of applicable securities laws.
Forward-looking statements include statements regarding our expectations,
anticipation, intentions, beliefs, or strategies regarding the future.
Forward looking statements also include statements regarding fluctuations in the
price of gold or certain other commodities, (such as silver, copper, diesel
fuel, and electricity); changes in national and local government legislation,
taxation, controls, regulations and political or economic changes in the United
States or other countries in which we may carry on business in the future;
business opportunities that may be presented to or pursued by us; our ability to
integrate acquisitions successfully; operating or technical difficulties in
connection with exploration or mining activities; the speculative nature of gold
exploration, including risks of diminishing quantities or grades of reserves;
and contests over our title to properties. All forward-looking statements
included in this report are based on information available to us as of the
filing date of this report, and we assume no obligation to update any such
forward-looking statements. Our actual results could differ materially from the
forward-looking statements.

PART I.

Item 1.Financial Statements.

3

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MADISON EXPLORATIONS, INC.(An Exploration Stage Enterprise)

CONSOLIDATED FINANCIAL STATEMENTSSEPTEMBER 30, 2008(UNAUDITED)

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MADISON EXPLORATIONS, INC. 
  (An Exploration Stage Enterprise) 
  CONTENTS

FINANCIAL STATEMENTS

|Consolidated Balance Sheets                              | F-1       
|-------------------------------------------------------- | ----------
|                                                         |           
|Consolidated Statements
      of Operations              | F-2       
|                                                         |           
|Consolidated Statements
      of Stockholders' (Deficit) | F-3       
|                                                         |           
|Consolidated Statements
      of Cash Flows              | F-4       
|                                                         |           
|Notes to Consolidated Financial Statements               | F-5 - F-10

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|MADISON EXPLORATIONS, INC.       
|---------------------------------
|(An Exploration Stage Enterprise)
|CONSOLIDATED BALANCE SHEETS      

|                                                    |   | September 30, |   |   | December 31, |  
|--------------------------------------------------- | - | ------------- | - | - | ------------ | -
|                                                    |   | 2008          |   |   | 2007         |  
|                                                    |   | (unaudited)   |   |   |              |  
|                                                    |   |               |   |   |              |  
|ASSETS                                              |   |               |   |   |              |  
|                                                    |   |               |   |   |              |  
|CURRENT ASSETS                                      |   |               |   |   |              |  
|Cash                                                | $ | 31,441        |   | $ | 5,637        |  
|                                                    |   |               |   |   |              |  
|Total
      assets                                  | $ | 31,441        |   | $ | 5,637        |  
|                                                    |   |               |   |   |              |  
|                                                    |   |               |   |   |              |  
|LIABILITIES AND STOCKHOLDERS' (DEFICIT)             |   |               |   |   |              |  
|CURRENT LIABILITIES                                 |   |               |   |   |              |  
|Accounts payable and accrued
      liabilities      | $ | 6,078         |   | $ | 7,221        |  
|Notes payable
      and accrued interest            |   | 103,374       |   |   | 61,922       |  
|Shareholder loan                                    |   | 561           |   |   | -            |  
|                                                    |   |               |   |   |              |  
|Total
        current liabilities                   | $ | 110,013       |   | $ | 69,143       |  
|                                                    |   |               |   |   |              |  
|                                                    |   |               |   |   |              |  
|STOCKHOLDERS (DEFICIT)                             |   |               |   |   |              |  
|Common stock: $.001 par value;                      |   |               |   |   |              |  
|Authorized 500,000,000 shares;                      |   |               |   |   |              |  
|Issued
      and outstanding: 113,020,000 shares    |   |               |   |   |              |  
|September 30, 2008 and December 31, 2007            | $ | 113,020       |   | $ | 113,020      |  
|Additional paid-in capital                          |   | (57,118       | ) |   | (57,118      | )
|Accumulated
      other comprehensive income        |   | (6,700        | ) |   | (7,740       | )
|Accumulated deficit during
      exploration stage  |   | (127,774      | ) |   | (111,668     | )
|                                                    |   |               |   |   |              |  
|Total
        stockholders (deficit)               | $ | (78,572       | ) | $ | (63,506      | )
|                                                    |   |               |   |   |              |  
|Total liabilities and stockholders
      (deficit) | $ | 31,441        |   | $ | 5,637        |  

See Accompanying Notes to Consolidated Financial Statements.

F-1

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|MADISON EXPLORATIONS, INC.           
|-------------------------------------
|(An Exploration Stage Enterprise)    
|CONSOLIDATED STATEMENTS OF OPERATIONS
|(UNAUDITED)                          

|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   | June 15, 1998 |  
|---------------------------------- | - | ------------------ | - | - | ----------------- | - | - | -------------- | - | - | ------------- |  | - | ------------- | -
|                                   |   | Three months ended |   |   | Nine months ended |   |   | (inception) to |  
|                                   |   | September 30,      |   |   | September 30,     |   |   | September 30,  |   |   | September 30, |  |   | September 30, |  
|                                   |   | 2008               |   |   | 2007              |   |   | 2008           |   |   | 2007          |  |   | 2008          |  
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|Revenues                           | $ | -                  |   | $ | -                 |   | $ | -              |   | $ | 50,000        |  | $ | 144,000       |  
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|Operating expenses                 |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|Exploration and development        | $ | -                  |   | $ | -                 |   | $ |                |   | $ | 131           |  | $ | 109,040       |  
|General and administrative         |   | 3,602              |   |   | 4,304             |   |   | 13,507         |   |   | 18,693        |  |   | 149,187       |  
|Income (loss) before other expense |   | (3,602             | ) |   | (4,304            | ) | $ | (13,507        | ) |   | 31,176        |  | $ | (114,227      | )
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|Other expense                      |   | 862                |   |   | 838               |   |   | 2,599          |   |   | 2,500         |  |   | 13,547        |  
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|Net income (loss)                  | $ | (4,464             | ) | $ | (5,142            | ) | $ | (16,106        | ) | $ | 28,676        |  | $ | (127,774      | )
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|Net income(loss) per share,        |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|basic and diluted                  | $ | (0.00              | ) | $ | 0.00              |   | $ | (0.00          | ) | $ | 0.00          |  |   |               |  
|                                   |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|Average number of shares           |   |                    |   |   |                   |   |   |                |   |   |               |  |   |               |  
|of common stock outstanding        |   | 113,020,000        |   |   | 113,020,000       |   |   | 113,020,000    |   |   | 113,020,000   |  |   |               |  

See Accompanying Notes to Consolidated Financial Statements.

F-2

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|MADISON EXPLORATIONS, INC.                               
|---------------------------------------------------------
|(An Exploration Stage Enterprise)                        
|CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY (DEFICIT)
|(UNAUDITED)                                              

|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   | Accumulated |   |   |         |  
|--------------------------------- |  | ------------ |  | - | -------- |  | - | ------------- | - | - | ----------- | - | - | ----------- | - | - | ------- | -
|                                  |  |              |  |   |          |  |   |               |   |   | Accumulated |   |   | Deficit     |   |   |         |  
|                                  |  |              |  |   |          |  |   | Additional    |   |   | Other       |   |   | During      |   |   |         |  
|                                  |  | Common Stock |  |   | Paid -in |  |   | Comprehensive |   |   | Exploration |   |   |             |  
|                                  |  | Shares       |  |   | Amount   |  |   | Capital       |   |   | Income      |   |   | Stage       |   |   | Total   |  
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|June 15, 1998, issue              |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|common stock                      |  | 53,750,000   |  | $ | 53,750   |  | $ | (53,320       | ) | $ | -           |   | $ | -           |   | $ | 430     |  
|Net loss, December 31, 1999       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | -           |   |   | -       |  
|Balance, December 31, 1999        |  | 53,750,000   |  | $ | 53,750   |  | $ | (53,320       | ) |   | -           |   | $ | -           |   | $ | 430     |  
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Net loss, December 31, 2000       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | -           |   |   | -       |  
|Balance, December 31, 2000        |  | 53,750,000   |  | $ | 53,750   |  | $ | (53,320       | ) | $ | -           |   | $ | -           |   | $ | 430     |  
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Net loss, December 31, 2001       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | -           |   |   | -       |  
|Balance, December 31, 2001        |  | 53,750,000   |  | $ | 53,750   |  | $ | (53,320       | ) | $ | -           |   | $ | -           |   | $ | 430     |  
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Net loss, December 31, 2002       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | -           |   |   | -       |  
|Balance, December 31, 2002        |  | 53,750,000   |  | $ | 53,750   |  | $ | (53,320       | ) | $ | -           |   | $ | -           |   | $ | 430     |  
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Net loss, December 31, 2003       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | -           |   |   | -       |  
|Balance, December 31, 2003        |  | 53,750,000   |  | $ | 53,750   |  | $ | (53,320       | ) | $ | -           |   | $ | -           |   | $ | 430     |  
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Issuance of common stock          |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|for cash                          |  | 59,070,000   |  |   | 59,070   |  |   | (58,598       | ) |   |             |   |   |             |   |   | 472     |  
|June 14, 2004 forward stock split |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|5000:1                            |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Capital contribution              |  |              |  |   |          |  |   | 5,000         |   |   |             |   |   |             |   |   | 5,000   |  
|Foreign currency adjustments      |  |              |  |   |          |  |   |               |   |   | (2,554      | ) |   |             |   |   | (2,554  | )
|Net loss, December 31, 2004       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | (49,088     | ) |   | (49,088 | )
|Balance, December 31, 2004        |  | 112,820,000  |  | $ | 112,820  |  | $ | (106,918      | ) | $ | (2,554      | ) | $ | (49,088     | ) | $ | (45,740 | )
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Foreign currency adjustments      |  |              |  |   |          |  |   |               |   |   | (444        | ) |   |             |   |   | (444    | )
|Net loss, December 31, 2005       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | (48,720     | ) |   | (48,720 | )
|Balance, December 31, 2005        |  | 112,820,000  |  | $ | 112,820  |  | $ | (106,918      | ) | $ | (2,998      | ) | $ | (97,808     | ) | $ | (94,904 | )
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Issuance of common stock          |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|for cash                          |  | 200,000      |  |   | 200      |  |   | 49,800        |   |   |             |   |   |             |   |   | 50,000  |  
|Foreign currency adjustments      |  |              |  |   |          |  |   |               |   |   | (1,297      | ) |   |             |   |   | (1,297  | )
|Net loss, December 31, 2006       |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | (38,511     | ) |   | (38,511 | )
|Balance, December 31, 2006        |  | 113,020,000  |  | $ | 113,020  |  | $ | (57,118       | ) | $ | (4,295      | ) | $ | (136,319    | ) | $ | (84,712 | )
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Foreign currency adjustments      |  |              |  |   |          |  |   |               |   |   | (3,445      | ) |   |             |   |   | (3,445  | )
|Net income, December 31, 2007     |  |              |  |   | -        |  |   | -             |   |   | -           |   |   | 24,651      |   |   | 24,651  |  
|Balance, December 31, 2007        |  | 113,020,000  |  | $ | 113,020  |  | $ | (57,118       | ) | $ | (7,740      | ) | $ | (111,668    | ) | $ | (63,506 | )
|                                  |  |              |  |   |          |  |   |               |   |   |             |   |   |             |   |   |         |  
|Foreign currency adjustments      |  |              |  |   |          |  |   |               |   |   | 1,040       |   |   | -           |   |   | 1,040   |  
|Net (loss), September 30, 2008    |  |              |  |   |          |  |   |               |   |   |             |   |   | (16,106     | ) |   | (16,106 | )
|Balance, September 30, 2008       |  | 113,020,000  |  | $ | 113,020  |  | $ | (57,118       | ) | $ | (6,700      | ) | $ | (127,774    | ) | $ | (78,572 | )

See Accompanying Notes to Consolidated Financial Statements.

F-3

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|MADISON EXPLORATIONS, INC.           
|-------------------------------------
|(An Exploration Stage Enterprise)    
|CONSOLIDATED STATEMENTS OF CASH FLOWS
|(UNAUDITED)                          

|                                                           |   |                   |   |   |                |   |   | June 15, 1998 |  
|---------------------------------------------------------- | - | ----------------- | - | - | -------------- | - | - | ------------- | -
|                                                           |   | Nine Months Ended |   |   | (inception) to |  
|                                                           |   | September 30,     |   |   | September 30,  |   |   | September 30, |  
|                                                           |   | 2008              |   |   | 2007           |   |   | 2008          |  
|                                                           |   |                   |   |   |                |   |   |               |  
|Cash Flows From                                            |   |                   |   |   |                |   |   |               |  
|Operating Activities                                       |   |                   |   |   |                |   |   |               |  
|Net income (loss)                                          | $ | (16,106           | ) | $ | 28,676         |   | $ | (127,774      | )
|Adjustments to reconcile net loss                          |   |                   |   |   |                |   |   |               |  
|to cash used in operating
      activities:                |   |                   |   |   |                |   |   |               |  
|Changes in assets and liabilities                          |   |                   |   |   |                |   |   |               |  
|(Increase) in deposits                                     |   | -                 |   |   | 1,001          |   |   | -             |  
|(Increase) in prepaid expenses                             |   | -                 |   |   | 4,290          |   |   | -             |  
|Increase (decrease) in
      accounts payable and accruals |   | (1,142            | ) |   | 6,038          |   |   | 6,078         |  
|Increase in deferred revenue                               |   | -                 |   |   | (50,000        | ) |   | -             |  
|                                                           |   |                   |   |   |                |   |   |               |  
|Net cash used in                                           |   |                   |   |   |                |   |   |               |  
|operating activities                                       | $ | (17,248           | ) | $ | (9,995         | ) |   | (121,696      | )
|                                                           |   |                   |   |   |                |   |   |               |  
|Cash Flows From                                            |   |                   |   |   |                |   |   |               |  
|Investing Activities                                       |   |                   |   |   |                |   |   |               |  
|Net cash provided used in                                  |   |                   |   |   |                |   |   |               |  
|investing activities                                       | $ | -                 |   | $ | -              |   |   | -             |  
|                                                           |   |                   |   |   |                |   |   |               |  
|Cash Flows From                                            |   |                   |   |   |                |   |   |               |  
|Financing Activities                                       |   |                   |   |   |                |   |   |               |  
|Issuance of common stock                                   | $ | -                 |   | $ | -              |   | $ | 113,020       |  
|Capital contribution                                       |   | -                 |   |   | -              |   |   | (57,118       | )
|Officer loans and advances                                 |   | 561               |   |   | (29,128        | ) |   | 561           |  
|Notes payable                                              |   | 41,451            |   |   | 29,190         |   |   | 103,374       |  
|                                                           |   |                   |   |   |                |   |   |               |  
|Net cash provided by (used in)                             |   |                   |   |   |                |   |   |               |  
|financing activities                                       | $ | 42,012            |   | $ | 62             |   | $ | 159,837       |  
|                                                           |   |                   |   |   |                |   |   |               |  
|Effect of exchange rate changes on cash and                |   |                   |   |   |                |   |   |               |  
|cash equivalents                                           | $ | 1,040             |   | $ | (945           | ) | $ | (6,700        | )
|                                                           |   |                   |   |   |                |   |   |               |  
|Net increase (decrease)                                    |   |                   |   |   |                |   |   |               |  
|in cash                                                    | $ | 25,804            |   | $ | (10,878        | ) | $ | 31,441        |  
|                                                           |   |                   |   |   |                |   |   |               |  
|Cash, beginning of period                                  |   | 5,637             |   |   | 20,422         |   |   | -             |  
|                                                           |   |                   |   |   |                |   |   |               |  
|Cash, end of period                                        | $ | 31,441            |   | $ | 9,544          |   | $ | 31,441        |  

See Accompanying Notes to Consolidated Financial Statements

F-4

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|MADISON EXPLORATIONS, INC.                
|------------------------------------------
|(An Exploration Stage Enterprise)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

|Note 1 | Interim Reporting                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | While the information presented
        in the accompanying interim nine months consolidated financial statements
        is unaudited, it includes all adjustments, which are, in the opinion of
        management, necessary to present fairly the financial position, results
        of operations and cash flows for the interim periods presented in accordance
        with accounting principles generally accepted in the United States of
        America. These interim financial statements follow the same accounting
        policies and methods of their application as the Companys December
        31, 2007 annual consolidated financial statements. All adjustments are
        of a normal recurring nature. It is suggested that these interim financial
        statements be read in conjunction with the Companys December 31
        2007 annual financial statements. Operating results for the nine months
        ended September 30, 2008 are not necessarily indicative of the results
        that can be expected for the year ended December 31, 2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Note 2 | Nature and Continuance of
        Operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | The Company was incorporated
        on June 15, 1998 in the State of Nevada, USA and the Companys common
        shares are publicly traded on the OTC Bulletin Board.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | The Company is in the business
        of diamond exploration. Management plans to further evaluate, develop
        and exploit their interests in diamond mineral properties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | Going Concern                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | These interim consolidated financial
        statements have been prepared in accordance with generally accepted accounting
        principles applicable to a going concern, which assumes that the Company
        will be able to meet its obligations and continue its operations for its
        next twelve months. Realization values may be substantially different
        from carrying values as shown and these financial statements do not give
        effect to adjustments that would be necessary to the carrying values and
        classification of assets and liabilities should the Company be unable
        to continue as a going concern. At September 30, 2008, the Company had
        not yet achieved profitable operations, has accumulated losses of $127,774
        since its inception and expects to incur further losses in the development
        of its business, all of which casts substantial doubt about the Companys
        ability to continue as a going concern. The Companys ability to
        continue as a going concern is dependent upon its ability to generate
        future profitable operations and/or to obtain the necessary financing
        to meet its obligations and repay its liabilities arising from normal
        business operations when they come due. Management has no formal plan
        in place to address this concern but considers that the Company will be
        able to obtain additional funds by equity financing and/or related party
        advances, however there is no assurance of additional funding being available.

F-5

---

|MADISON EXPLORATIONS, INC.                
|------------------------------------------
|(An Exploration Stage Enterprise)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 2. Nature and Continuance of Operations

a) Recent Accounting Pronouncements

In May, 2008, the Financial Accounting Standards Board issued
  Statement of Financial Accounting Standards No. 163, Accounting for Financial
  Guarantee Insurance Contractsan interpretation of FASB Statement No. 60
  (SFAS 163). This Statement requires that an insurance enterprise recognize a
  claim liability prior to an event of default (insured event) when there is evidence
  that credit deterioration has occurred in an insured financial obligation. This
  Statement also clarifies how Statement 60 applies to financial guarantee insurance
  contracts, including the recognition and measurement to be used to account for
  premium revenue and claim liabilities. Those clarifications will increase comparability
  in financial reporting of financial guarantee insurance contracts by insurance
  enterprises. This Statement requires expanded disclosures about financial guarantee
  insurance contracts. The accounting and disclosure requirements of the Statement
  will improve the quality of information provided to users of financial statements.
  This Statement is effective for financial statements issued for fiscal years
  beginning after December 15, 2008, and all interim periods within those fiscal
  years, except for some disclosures about the insurance enterprises risk-management
  activities. This Statement requires that disclosures about the risk-management
  activities of the insurance enterprise be effective for the first period (including
  interim periods) beginning after issuance of this Statement. Except for those
  disclosures, earlier application is not permitted. The adoption of this statement
  will have no material effect on the Companys financial condition or results
  of operations.

In May, 2008, the Financial Accounting Standards Board issued
  Statement of Financial Accounting Standards No. 162, The Heirarchy of
  Generally Accepted Accounting Principles (SFAS No. 162). This Statement
  identifies the sources of accounting principles and the framework for selecting
  the principles to be used in the preparation of financial statements of nongovernmental
  entities that are presented in conformity with generally accepted accounting
  principles (GAAP) in the United States (the GAAP hierarchy). The sources of
  accounting principles1 that are generally accepted are categorized in descending
  order of authority as follows:

a. FASB Statements of Financial Accounting Standards and Interpretations,
  FASB Statement 133 Implementation Issues, FASB Staff Positions, and American
  Institute of Certified Public Accountants (AICPA) Accounting Research Bulletins
  and Accounting Principles Board Opinions that are not superseded by actions
  of the FASB

b. FASB Technical Bulletins and, if cleared2 by the FASB, AICPA
  Industry Audit and Accounting Guides and Statements of Position

c. AICPA Accounting Standards Executive Committee Practice Bulletins
  that have been cleared by the FASB, consensus positions of the FASB Emerging
  Issues Task Force (EITF), and the Topics discussed in Appendix D of EITF
  Abstracts(EITF D-Topics)

F-6

---

|MADISON EXPLORATIONS, INC.                
|------------------------------------------
|(An Exploration Stage Enterprise)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 2. Nature and Continuance of Operations  Contd

a) Recent Accounting Pronouncements  Contd

d. Implementation guides (Q&As) published by the FASB staff,
  AICPA Accounting Interpretations, AICPA Industry Audit and Accounting Guides
  and Statements of Position not cleared by the FASB, and practices that are widely
  recognized and prevalent either generally or in the industry.

The adoption of this statement will have no material effect on
  the Companys financial condition or results of operations.

In March 2008, the Financial Accounting Standards Board issued
  Statement of Financial Accounting Standards No. 161, Disclosures about
  Derivative Instruments and Hedging Activitiesan amendment of FASB Statement
  No. 133 (SFAS No. 161). This statement changes the disclosure requirements
  for derivative instruments and hedging activities. Entities are required to
  provide enhanced disclosures about (a) how and why an entity uses derivative
  instruments, (b) how derivative instruments and related hedged items are accounted
  for under Statement 133 and its related interpretations, and (c) how derivative
  instruments and related hedged items affect an entitys financial position,
  financial performance, and cash flows. This Statement is intended to enhance
  the current disclosure framework in Statement 133. The Statement requires that
  objectives for using derivative instruments be disclosed in terms of underlying
  risk and accounting designation. This disclosure better conveys the purpose
  of derivative use in terms of the risks that the entity is intending to manage.
  Disclosing the fair values of derivative instruments and their gains and losses
  in a tabular format should provide a more complete picture of the location in
  an entitys financial statements of both the derivative positions existing
  at period end and the effect of using derivatives during the reporting period.
  Disclosing information about credit-risk-related contingent features should
  provide information on the potential effect on an entitys liquidity from
  using derivatives. Finally, this Statement requires cross-referencing within
  the footnotes, which should help users of financial statements locate important
  information about derivative instruments.

Cash and Cash EquivalentsFor purposes of the statement of cash flows, the Company considers all highly
  liquid investments and short-term debt instruments with original maturities
  of three months or less to be cash equivalents. As of September 30, 2008 and
  March 31, 2008, the Company had no cash equivalents.

Derivative InstrumentsThe Financial Accounting Standards Board issued Statement of Financial Accounting
  Standards No. 133, Accounting for Derivative Instruments and Hedging Activities
  (hereinafter SFAS No. 133), as amended by SFAS No. 137, Accounting
  for Derivative Instruments and Hedging Activities  Deferral of the Effective
  Date of FASB No. 133, and SFAS No. 138, Accounting for Certain Derivative
  Instruments and Certain Hedging Activities, and SFAS No. 149, Amendment
  of Statement 133 on Derivative Instruments and Hedging Activities. These
  statements establish accounting and reporting standards for derivative instruments,
  including certain derivative instruments embedded in other contracts, and for
  hedging activities. They require that an entity recognize all derivatives as
  either assets or liabilities in the balance sheet and measure those instruments
  at fair value.

F-7

---

|MADISON EXPLORATIONS, INC.                
|------------------------------------------
|(An Exploration Stage Enterprise)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 2. Nature and Continuance of Operations  Contd

a) Recent Accounting Pronouncements  Contd

If certain conditions are met, a derivative may be specifically
  designated as a hedge, the objective of which is to match the timing of gain
  or loss recognition on the hedging derivative with the recognition of (i) the
  changes in the fair value of the hedged asset or liability that are attributable
  to the hedged risk or (ii) the earnings effect of the hedged forecasted transaction.
  For a derivative not designated as a hedging instrument, the gain or loss is
  recognized in income in the period of change.

At September 30, 2008 and 2007, the Company has not engaged in
  any transactions that would be considered derivative instruments or hedging
  activities.

b) Concentration of Credit Risks

The Company maintains its cash in bank deposit accounts, the
  balances of which, at times, may exceed Federal insurance limits. Exposure to
  credit risk is reduced by placing such deposits with major financial institutions
  and monitoring their credit ratings.

c) Impairments of Long Lived Assets

Impairment losses on long-lived assets, such as mining claims,
  are recognized when events or changes in circumstances indicate that the undiscounted
  cash flows estimated to be generated by such assets are less than their carrying
  value and, accordingly, all or a portion of such carrying value may not be recoverable.
  Impairment losses are then measured by comparing the fair value of assets to
  their carrying amounts.

d) Foreign Currency Translation and Transactions

The functional currency of the Company's operations is Canadian
  dollars. The assets and liabilities arising from these operations are translated
  at current exchange rates and related revenues and expenses at the exchange
  rates in effect at the time the revenue or expense is incurred. Resulting translation
  adjustments, if material, are accumulated as a separate component of accumulated
  other comprehensive income in the statement of stockholders' deficiency while
  foreign currency transaction gains and losses are included in operations.

The Company recorded a foreign currency (gain) loss of $nil during
  the nine months ended September 30, 2008 and 2007, respectively.

F-8

---

|MADISON EXPLORATIONS, INC.                
|------------------------------------------
|(An Exploration Stage Enterprise)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 2. Nature and Continuance of Operations  Contd

e) Mining Costs

Exploration and evaluation costs are expensed as incurred. Management's
  decision to develop or mine a property is based on an assessment of the viability
  of the property and the availability of financing. The Company will capitalize
  mining exploration and other related costs attributable to reserves when a definitive
  feasibility study establishes proven and probable reserves. Capitalized mining
  costs will be expensed using the unit of production method and will also be
  subject to an impairment assessment.

f) Consolidation

The consolidated financial statements include the accounts of
  the Company and its subsidiary. All significant inter-company balances and transactions
  have been eliminated.

g) Estimates

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

Note 3. Stockholders Equity

Net loss per common share

Net loss per share is calculated in accordance with SFAS No.
  128, Earnings Per Share. The weighted-average number of common shares
  outstanding during each period is used to compute basic loss per share. Diluted
  loss per share is computed using the weighted averaged number of shares and
  dilutive potential common shares outstanding. Dilutive potential common shares
  are additional common shares assumed to be exercised.

The Company has no warrants or options outstanding at September
  30, 2008 or December 31, 2007.

F-9

---

|MADISON EXPLORATIONS, INC.                
|------------------------------------------
|(An Exploration Stage Enterprise)         
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 4. Notes Payable

The Company has a note payable in the amount of $25,000 from
  Pale Face Holdings, Ltd. The note provides for interest payable at 8% annually.
  Accrued interest on the note payable was $7,297 as at September 30, 2008 and
  $5,797 for the year ended December 31, 2007. The note payable balance including
  accrued interest was $32,297 and $30,297 at September 30, 2008 and September
  30, 2007, respectively.

Two former officers of the Company have advanced funds to the
  Company to continue ongoing operations. On June 25, 2004, two former officers
  executed demand notes at 5% interest for $15,000 in CAD ($15,563 USD) each.
  Interest on the notes payable for the nine months ended September 30, 2008,
  was $1,099 and $1,000 for the nine months ended September 30, 2007. As of September
  30, 2008 and September 30, 2007, the former officer advances were $31,076 and
  $27,690. Effective June 30, 2007 the debt to the officers was sold to Paleface
  Holdings and is included with the Notes Payable at September 30, 2008 and December
  31, 2007.

On April 7, 2008, the company entered into a non-interest bearing,
  $40,000 promissory note that is due on demand and may be converted in whole
  or portion thereof, into common stock of the company at $0.01 per share

F-10

---

Item 2.Managements Discussion and Analysis or
Plan of Operations

The following discussion provides information that we believe
is relevant to an assessment and understanding of the results of operations and
financial condition of our Company. It should be read in conjunction with the
financial statements and accompanying notes.

Plan of Operation

GEOLOGICAL REPORT: SOUTHERN SASKATCHEWAN

The Company has several specific exploration objectives:

(1) To locate one or more Kimberlite/Lamproite pipes, dykes or
sills; (2) To determine whether the Kimberlite/Lamproite contains Diamonds;
and (3) To determine if the diamond-bearing pipe could be the source of an
economically viable mine.

Even if the Company locates Kimberlite, the finding of diamonds
in Kimberlite is rare and the finding of a commercial grade of diamonds is
rarer.

We believe that exploration is by its very nature is
evolutionary. Each subsequent step is based on the foundation established by
previous results. Even then, diverse factors affect the process. Weather and
seasons influence when work can be commissioned. Previous results determine the
direction for future exploration and the availability of funds dictates what
work can be budgeted for each phase of exploration.

The Company has completed its initial phase of work on the
Scout Lake properties and now intends to continue the initial phase of work on
some of its other properties in the Wood Mountain District. The results at our
Scout Lake properties do not warrant spending further time and money at this
location. Phase one work should consist of a ground magnetometer survey at
approximately 500 meter line-spacing. At the same time, surface samples should
be taken of till for heavy mineral evaluation. About 50 samples would cover the
grid area satisfactorily. If results warrant, a few lines of gravimetric
surveying could be done. Two or three RC drill holes (about 500 meter) would
then test the anomaly.

Phase 1 - Initial Wood Mountain Evaluation

- Ground Magnetometer - 1 month
      Instrument Rental
    
    1,800- 50 Sample Collections - Processing @ $50 each
    
    2,500- Gravimetric Survey - Instrument Rental
    
    600- Chemical Analysis - 50 @ $10 each
    
    500- Personnel - Geologist 2 weeks @ $300/day
    
    4,200- Personnel - Assistant 2 weeks @ $200/day
    
    2,800- Accommodation - $100/day x 2
    
    2,800- Transportation - Truck Rental, Maintenance
    
    2,000Engineering & Supervision- Engineering & Supervision
    
    2,000- Contingencies approximately 5%
    
    900Phase 1 Total
    $
    20,100 4


---

Phase Two - Regional Program

The regional program of exploration is being proposed to locate
kimberlite diatremes. At present, we have regional to detailed heavy mineral
anomalies and regional to detailed magnetic anomalies. Unfortunately, the heavy
mineral dispersion is too widespread and the magnetic anomalies are too numerous
to allow reasonable drill target selection. The following systematic approach
may help us to alleviate this problem:

Regional Structural Study

Kimberlite pipe emplacement is governed by deep-seated
structures that penetrate stable Archean Cratons and allow the rapid rise of
lower mantle ultramafic magmas through diamond-bearing strata. Some of the major
structures in southern Saskatchewan are known, but it appears that a satellite
imagery interpretation, in particular of radar data, would be of value to
us.

Regional Heavy Mineral Study

Heavy mineral data is already available to us from the
government and other available for purchase proprietary surveys. However, a
large proportion of the area of our interest remains without data.

It is proposed that a detailed heavy mineral survey be
conducted over the area with one sample being taken per township to start. The
usual method of processing heavy mineral samples, which includes, washing,
sizing, gravity separation by jig, tables or heavy liquids, microscopic
hand-picking and microprobe analysis would be prohibitively expensive.
Therefore, the following processing methodology is suggested:

(a) Sample till or stream sediments (about 20 kg).(b) Wash
and sieve sample in the field or nearby portable equipment to obtain a clean,
sized fraction suitable for hydrosizing.(c) Use a laboratory-sized
elutriator (hydrosizer) to obtain a sized, heavy mineral fraction. Adjust
density to retain all indicator minerals.(d) Analyze for chromium and nickel
and other trace elements by total fusion and ICP. This will provide an indicator
for ultramafic rocks.(e) Plot results and evaluate for trends.(f) Some
detailed HM testing, - microprobing grain-picking.

Wood Mountain Formation Study

Heavy minerals including standard indicator minerals and
micro-diamonds have been recovered from the unconsolidated sand and gravel
deposits of the Wood Mountain formation. We believe that a heavy mineral study
of this formation and a paleo-current study should be undertaken. The samples
should be processed in the same manner as in the "Regional Heavy Mineral
Study."

Compilation of Geophysical Data

(a) Aeromagnetic (b) Ground magnetic (c) Gravimetric
(d) Seismic

G.I.S. Compilation of all Data

5

---

A G.I.S. (Geographic Information Systems) compilation of the
following data should be undertaken in order to select the best drill
targets:

(a) Bedrock Geology(b) Surficial Geology (i.e. land surface
to approximately 5 feet below) (c) Our HM Surveys (d) Government surveys
(e) Federal-provincial geochem and HM(f) Aeromagnetic Data surveys
(g) Gravity Data (h) Seismic Data (i) Ground Magnetic Data (j)
Cratonic Age Data(k) Satellite Radar Imagery Interpretation

Phase 2 - Regional Program

Regional Structural Study- Satellite Photos - 10 @ $200 each
    
    2,000- Interpretation - 10 hours @ $500
    
    5,000- Digitizing
    
    3,000Regional Heavy Mineral Study- Sample collection - 600 samples @ $15 each
    
    9,000- Vehicle - FWD - 3 months @ $2,000/month
    
    6,000- Detail Sample Collection - 1000 samples @ $15 each
    
    15,000- Initial Processing
    
    24,000- Washer/Sieve rental - 3 months @ $2,000/month
    
    6,000- Sample Bags - 1,600 20Kg bags @ $1 each
    
    1,600- Sample Bags - 1,600 2Kg bags @ $1 each
    
    1,600- Elutriation (Hydraulic Separation of HM)
      - 1600 @ $18.75 each
    
    30,000- ICP (Induced Coupled Polarization) (total) - 1600 @ $10
      each
    
    16,000- Digitizing
    
    3,000Regional Surficial Geology Study- Data Interpretation
    
    4,000- Digitizing
    
    3,000Compilation of Geophysical Data- Data Collection
    
    2,500- Data Interpretation
    
    5,000- Digitizing
    
    4,000G.I.S. Compilation- Additional Data Collection
    
    5,000- Data Interpretation
    
    5,000- Digitizing
    
    5,000Engineering & Supervision- Engineering & Supervision
    
    15,000- Contingencies approximately 5%
    
    7,800Phase 2 Total
    $
      178,500 6


---

Phase Three - Drilling and Confirmation

The goal of this phase will be to locate anomalous areas by the
use of ground magnetic surveys, and to prioritize each for test drilling.

Gravimetric Surveys will be completed over the ground magnetic
anomalies - 1 or 2 lines per anomaly. Test Drilling will then be conducted to
test the best targets.

Phase 3 - Drilling and Confirmation

Ground Magnetic Surveys- Instrument Rental - 3 months @
      $1,600/month
    
    4,800- Field computer Rental - 3 month @ $300/month
    
    900- Operator/Assistant - 70 Days @ $300/day
    
    21,000Gravimetric Survey- Instrument Rental - 3 months @ $1,600/month
    
    3,000- Operator/Assistant - 70 Days @ $300/day
    
    21,000- Surveying
    
    6,000Test Drilling- 5,000 ft. @ $10
    
    50,000- Cutting Analysis - 50 samples @ $500 each
    
    25,000Engineering & Supervision- Engineering & Supervision
    
    13,000Contingencies approximately 5%
    
    6,700Phase 3 Total
    $
    151,400


Twenty four Month Exploration Budget on new and future
claims

The Company intends to option additional property by way of
claim staking or acquiring companies with promising mineral claims in the area
of Southern Saskatchewan and Northern Montana

Planned Exploration on future Claims
    
    Year 1
    
    
    Year 2Claim Staking/property acquisition
    
    50,000
    
    
    50,000Property
      Exploration Expenditures
    
    500,000
    
    
    650,000$
    550,000
    
    $
    700,000


The Company's business plan for the year 2008 will consist of
  further exploration on the properties over which we hold mineral exploration
  claims and options. As part of Phase Two, the Company also plans to continue
  staking strategically important areas as more information becomes available
  with respect to the geology of Southern Saskatchewan. The Company intends to
  use third party

7

---

contractors to collect soil samples, process and analyze the results, plot drill targets, drill the identified targets and other exploration related work. The Company completed its drill program at Scout Lake in 2005. The results of the drill
program do not warrant spending further time and money at this location. The main thrust of our program will now be in the Val Marie area of the Wood Mountain district in Southern Saskatchewan. As of March 31, 2008 the Company has 55 mineral claims
in Southern Saskatchewan.

The combination of numerous indicator minerals (pyrope garnets and chrome diopsides) and magnetic anomalies make this area a prime target. The indicator mineral suite is identical chemically to that of the Fort a la Corne district.

An early drilling program is anticipated for this area. Additional targets in the Wood Mountain district and other areas will also be investigated. Keating analysis of existing geophysical data over the Company's claim holdings has identified 6
potential diamond targets, including the 3 targets that were previously designated as high priority drill targets. Preliminary investigation of these targets will be carried out to assess the possibility of diamond deposits existing on the Company's
properties.

The Company estimates that we will require approximately $2,000,000 Canadian to conduct its full exploration program over a two year period. This amount will be used to pay for prospecting and geological mapping, airborne surveys, lodging and
food for workers, transportation of workers to and from the work sites, fuel, pick-up truck rentals, assays, drilling, equipment rental, additional claim staking, and supervision.

The officers and directors have agreed to pay all costs and expenses of having the Company comply with the federal securities laws (and being a public company) should the Company be unable to do so. We estimate that these costs will be approximately
$20,000 per year. Our officers and directors have also agreed to pay the other expenses of the Company, excluding those direct costs and expenses of data gathering and mineral exploration, should the Company be unable to do so. To implement our
business plan, we will need to secure financing for our business development. We have no source for funding at this time.

If we are unable to raise additional funds to satisfy our reporting obligations, investors will no longer have access to current financial and other information about our business affairs.

Additional funding to conduct either our full exploration
  program or a partial exploration program will depend upon our ability to secure
  loans or obtain either private or public financing. We have had some preliminary
  negotiations for funding that have been unsuccessful and we currently have not
  undertaken any further negotiations. There is no assurance that we will be able
  to obtain such funding on any terms or terms acceptable to us and if adequate
  funds are not available, we believe that our business development will be adversely
  affected. Accordingly, there is no assurance that we will be able to continue
  in business.

8

---

Results of Operations

Three-Month Period Ended September 30, 2008

We did not earn any revenues during the three-month period ended September 30, 2008 (three-month period ended September 30, 2007: $Nil).

We incurred operating expenses in the amount of $3,602 for the three-month period ended September 30, 2008 (three-month period ended September 30, 2007: $4,304). These operating expenses, comprised of general and administration expenses.

Nine-Month Period Ended September 30, 2008

We did not earn any revenues during the nine-month period ended September 30, 2008 (nine-month period ended September 30, 2007: $50,000).

We incurred operating expenses in the amount of $13,507
  for the nine-month period ended September 30, 2008 (nine month-period ended
  September 30, 2007: $18,824). These operating expenses, comprised of general
  and administration expenses of $13,507 (nine month-period ended September
  30, 2007: $18,693) and exploration and development expenses of $Nil
  (nine month-period ended September 30, 2007: $131).

9

---

Liquidity and Capital Resources

The officers and directors have agreed to pay all costs and expenses of having the Company comply with the federal securities laws (and being a public company) should the Company be unable to do so. We estimate that these costs will be approximately
$20,000 per year. Our officers and directors have also agreed to pay the other expenses of the Company, excluding those direct costs and expenses of data gathering and mineral exploration, should the Company be unable to do so. To implement our
business plan, we will need to secure financing for our business development. We have no source for funding at this time.

If we are unable to raise additional funds to satisfy our reporting obligations, investors will no longer have access to current financial and other information about our business affairs.

Additional funding to conduct either our full exploration program or a partial exploration program will depend upon our ability to secure loans or obtain either private or public financing. We have had some preliminary negotiations for funding that
have been unsuccessful and we currently have not undertaken any further negotiations. There is no assurance that we will be able to obtain such funding on any terms or terms acceptable to us and if adequate funds are not available, we believe that
our business development will be adversely affected. Accordingly, there is no assurance that we will be able to continue in business.

Item 3. Quantitative and Qualitative Disclosures About Market Risks

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange
Act of 1934, as amended) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on the evaluation and the identification of the material weaknesses in our internal control over financial reporting, as described in our Form
10-KSB for the year ended December 31, 2007, our Chief Executive Officer and our Chief Accounting Officer concluded that, as of September 30, 2008, our disclosure controls and procedures were effective.

Changes in internal control over financial reporting

There have been no changes during the period covered by this Quarterly Report on Form 10-Q in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over
financial reporting.

Limitations on the effectiveness of controls and procedures

Our management, including our Chief Executive Officer and
  Chief Financial Officer, does not expect that our controls and procedures will
  prevent all potential error and fraud. A control system, no matter how well
  conceived and operated, can provide only reasonable, not absolute, assurance
  that the objectives of the control system are met.

10

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 2. Unregistered Sales of Equity Securities and Use of
Proceeds

There were no unregistered sales of equity securities during
the three month period ended September 30, 2008.

Item 3. Defaults Upon Senior Securities

None.

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

None..

Item 5. Other Information

None.

Item 6. Exhibits

(a) The following documents are filed as part of this Report:

(1) Financial statements filed as part of this Report:
Consolidated Balance Sheet as of September 30, 2008 (Unaudited)

Consolidated Statement of Operations for the three and nine
month periods ended September 30, 2008 and 2007 (Unaudited)

Consolidated Statement of Cash Flows for the three and nine
month periods ended September 30, 2008 and 2007 (Unaudited)

Consolidated Statement of Stockholders Deficit for the three
and nine month periods ended September 30, 2008 and 2007 (Unaudited)

Notes to Financial Statements

(2) Exhibits filed as part of this Report:

|Exhibit |                                                                                                                                                                     
|------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description                                                                                                                                                         
|        |                                                                                                                                                                     
|31.1    | Certification
        of Chief Executive Officer pursuant to Rule 13a-15e or 15d-15(e), as adopted
        pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|31.2    | Certification
        of Chief Financial Officer pursuant to Rule 13a-15e or 15d-15(e), as adopted
        pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

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|32.1 | Certification
        of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
        pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
|32.2 | Certification
        of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
        pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(b) Reports filed on Form 8-K during the quarter ended
September 30, 2008:

None

SIGNATURES

Pursuant to the requirements 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.

|Date: November, 12, 2008 | Madison Exploration Inc.                    
|------------------------ | --------------------------------------------
|                         | (Registrant)                                
|                         |                                             
|                         | /s/
      Joseph Gallo                      
|                         | By: Joseph Gallo                            
|                         | Title: President and Chief Executive Officer
|                         |                                             
|                         | /s/
      Steven Cozine                     
|                         | By: Steven Cozine                           
|                         | Chief Financial Officer                     

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