U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


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


                       For the period ended June 30, 2009


[ ] 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. 000-52139


                            MORGAN CREEK ENERGY CORP.
                 ______________________________________________
                 (Name of small business issuer in its charter)


            NEVADA                                                201777817
_______________________________                              ___________________
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)


                5050 QUORUM DRIVE, SUITE 700, DALLAS, TEXAS 75254
                _________________________________________________
                    (Address of principal executive offices)


                                 (214) 722-6490
                           ___________________________
                           (Issuer's telephone number)


Securities registered pursuant to Section         Name of each exchange on which
            12(b) of the Act:                              registered:
                  NONE


          Securities registered pursuant to Section 12(g) of the Act:
                              COMMON STOCK, $0.001
                              ____________________
                                (Title of Class)


<PAGE>


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

Indicate by check mark whether the registrant has submitted  electronically  and
posted on its corporate Web site, if any, every  Interactive  Data File required
to be  submitted  and posted  pursuant to Rule 405 of  Regulation  S-T  (Section
229.405 of this  chapter)  during the  preceding  12 months (or for such shorter
period that the registrant was required to submit and post such files.

                                 Yes [X] No[ ]

Indicate by check mark whether the registrant is a large  accelerated  filed, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer [ ]                                Accelerated filer [ ]

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

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

Applicable  Only  to  Issuer  Involved  in  Bankruptcy  Proceedings  During  the
Preceding Five Years.

                                      N/A

Indicate by  checkmark  whether the issuer has filed all  documents  and reports
required to be filed by Section 12, 13 and 15(d) of the Securities  Exchange Act
of 1934 after the  distribution of securities under a plan confirmed by a court.
Yes [ ] No [ ]

                    Applicable Only to Corporate Registrants

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the most practicable date:

Class                                          Outstanding as of  August 4, 2009
Common Stock, $0.001                           34,032,392*

*Increased from 17,016,196 shares of common stock to 34,032,392 shares of common
stock as a result of the August 3, 2009 Forward Stock Split.


                                       2


<PAGE>


                           MORGAN CREEK ENERGY CORP.

                                   Form 10-Q

Part 1.   FINANCIAL INFORMATION                                                4

Item 1.   FINANCIAL STATEMENTS
             Balance Sheets                                                    5
             Statements of Operations                                          6
             Statements of Cash Flows                                          7
             Notes to Financial Statements                                     8

Item 2.   Management's Discussion and Analysis of Financial Condition and
          Results of Operations                                               16

Item 3.   Quantitative and Qualitative Disclosures About Market Risk          26

Item 4.   Controls and Procedures                                             27

Part II.  OTHER INFORMATION                                                   28

Item 1.   Legal Proceedings                                                   28

Item 1A.  Risk Factors                                                        28

Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds         28

Item 3.   Defaults Upon Senior Securities                                     28

Item 4.   Submission of Matters to a Vote of Security Holders                 28

Item 5.   Other Information                                                   29

Item 6.   Exhibits                                                            30


                                       3


<PAGE>


PART I

ITEM 1. FINANCIAL STATEMENTS











                            MORGAN CREEK ENERGY CORP.

                         (An Exploration Stage Company)

                              FINANCIAL STATEMENTS

                                  JUNE 30, 2009
                                   (UNAUDITED)

















                                       4


<PAGE>

<TABLE>
<CAPTION>

                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                                 BALANCE SHEETS

                                                                        June 30,          December 31,
                                                                          2009               2008
_____________________________________________________________________________________________________
                                                                       (Unaudited)         (Audited)
<S>                                                                    <C>                <C>
                                     ASSETS
CURRENT ASSETS
   Cash                                                                $    20,843        $    14,883
   Prepaid expenses and other                                               12,049             25,804
_____________________________________________________________________________________________________

TOTAL CURRENT ASSETS                                                        32,892             40,687

OIL AND GAS PROPERTIES, unproven (Note 3)                                1,811,943          1,802,943
_____________________________________________________________________________________________________

TOTAL ASSETS                                                           $ 1,844,835        $ 1,843,630
=====================================================================================================

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
   Accounts payable and accrued liabilities                            $   351,434        $   303,959
   Due to related parties (Note 6)                                         485,013            331,162
_____________________________________________________________________________________________________

TOTAL CURRENT LIABILITIES                                                  836,447            635,121

TOTAL LIABILITIES                                                          836,447            635,121
_____________________________________________________________________________________________________

GOING CONCERN (Note 1)

STOCKHOLDERS' EQUITY (Note 4)
Common stock, 66,666,666 shares authorized with $0.001 par value
Issued and outstanding
   30,432,392 common shares (December 31, 2008 - 30,432,392)                30,432             30,432
   Additional paid-in-capital                                            8,162,785          8,162,785
   Private placement subscriptions                                          65,000                  -
   Deficit accumulated during exploration stage                         (7,249,829)        (6,984,708)
_____________________________________________________________________________________________________

TOTAL STOCKHOLDERS' EQUITY                                               1,008,388          1,208,509
_____________________________________________________________________________________________________

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY                               $ 1,844,835        $ 1,843,630
=====================================================================================================


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

</TABLE>


                                       5


<PAGE>

<TABLE>
<CAPTION>

                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                                                                                                                  October 19,
                                                                                                                     2004
                                                      Three Months Ended               Six Months Ended           (inception)
                                                            June 30                         June 30               to June 30,
                                                     2009            2008            2009            2008            2009
_____________________________________________________________________________________________________________________________
<S>                                               <C>             <C>             <C>             <C>             <C>

GENERAL AND ADMINISTRATIVE EXPENSES
   Investor relations                             $         -     $    33,644     $         -     $    33,644     $   322,018
   Consulting fees                                          -          64,937          15,000         177,782         871,960
   Management fees - related party                     65,000          91,500         110,600         151,500         998,683
   Management fees - stock based compensation               -         436,955               -         436,955       1,964,125
   Impairment of oil and gas properties                     -               -               -               -       1,273,410
   Office and general                                  46,445          96,389          66,332         127,509         588,307
   Professional fees                                   30,680          68,687          58,584         120,249         694,336
_____________________________________________________________________________________________________________________________

NET OPERATING LOSS:                                  (142,125)       (792,112)       (250,516)     (1,047,639)     (6,712,839)
_____________________________________________________________________________________________________________________________

OTHER EXPENSE
   Financing costs                                          -               -               -        (424,660)       (424,660)
   Interest expense                                    (8,011)        (13,105)        (14,603)        (22,448)       (112,330)
_____________________________________________________________________________________________________________________________

TOTAL OTHER EXPENSE                                    (8,011)         (9,425)        (14,603)       (447,108)       (536,990)
_____________________________________________________________________________________________________________________________

NET LOSS                                          $  (150,136)    $  (805,217)    $  (265,120)    $(1,494,747)    $(7,249,829)
=============================================================================================================================



BASIC LOSS PER COMMON SHARE                       $     (0.00)    $     (0.03)    $     (0.01)    $     (0.06)
=============================================================================================================

WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
-BASIC                                             30,432,392      27,984,392      30,432,392      25,352,382
=============================================================================================================



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

</TABLE>


                                       6


<PAGE>

<TABLE>
<CAPTION>

                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                            STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                                                                                                   October 19,
                                                                                       Six Months Ended                2004
                                                                                            June 30               (inception) to
                                                                                     2009            2008         June 30, 2009
________________________________________________________________________________________________________________________________
<S>                                                                               <C>             <C>              <C>

CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss                                                                       $  (265,120)    $(1,494,747)     $(7,249,827)
   Adjustments to reconcile net loss to net cash used in operating activities:
   - Stock based compensation                                                               -         436,955        1,964,125
   - Impairment of oil and gas properties                                                   -               -        1,273,410
   - Interest accrued                                                                  14,603          22,448          112,329
   - Financing costs                                                                        -         424,660          424,660
CHANGES IN OPERATING ASSETS AND LIABILITIES
   - Prepaid expenses and other                                                        13,755          (5,413)         (37,049)
   - Due to related parties                                                            39,247          26,321          230,111
   - Accounts payable and accrued liabilities                                          47,475        (145,593)         311,755
________________________________________________________________________________________________________________________________

NET CASH USED IN OPERATING ACTIVITIES                                                (150,040)       (735,369)      (2,970,486)
________________________________________________________________________________________________________________________________

CASH FLOWS FROM INVESTING ACTIVITIES
   Oil and gas property expenditures                                                   (9,000)       (102,238)      (2,770,266)
________________________________________________________________________________________________________________________________

NET CASH FLOWS USED IN INVESTING ACTIVITIES                                            (9,000)       (102,238)      (2,770,266)
________________________________________________________________________________________________________________________________

CASH FLOWS FROM FINANCING ACTIVITIES
   Proceeds on subscriptions of common stock                                           65,000         400,000        3,087,095
   Drilling Advances                                                                        -               -          759,000
   Advances from related parties                                                      100,000         480,000        1,915,500
________________________________________________________________________________________________________________________________

NET CASH PROVIDED BY FINANCING ACTIVITIES                                             165,000         880,000        5,761,595
________________________________________________________________________________________________________________________________

INCREASE IN CASH                                                                        5,960          42,393           20,843

CASH, BEGINNING OF PERIOD                                                              14,883          16,098                -
________________________________________________________________________________________________________________________________

CASH, END OF PERIOD                                                               $    20,843     $    58,491      $    20,843
================================================================================================================================

SUPPLEMENTAL CASH FLOW INFORMATION AND
   NONCASH INVESTING AND FINANCING ACTIVITIES:
     Cash paid for interest                                                       $         -     $         -      $         -
     Cash paid for income taxes                                                   $         -     $         -      $         -
     Common stock issued for acquisition of oil and gas property                  $         -     $         -      $   950,000
     Transfer of bond against settlement of debt                                  $         -     $         -      $    25,000
     Non-cash sale of oil and gas property                                        $         -     $         -      $    65,000
     Common stock issued for settlement of debts (Note 4)                         $         -     $ 2,856,997      $ 2,856,997


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

</TABLE>


                                       7


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION
________________________________________________________________________________

Morgan Creek Energy Corp. (the  "Company") is an exploration  stage company that
was  organized to enter into the oil and gas  industry.  The Company  intends to
locate, explore, acquire and develop oil and gas properties in the United States
and within North America.  The primary  activity and focus of the Company is its
leases in New Mexico ("New Mexico Prospect").  The leases are unproven.  To date
we have leased approximately 7,576 net acres within the State of New Mexico. The
company has also entered into an option to acquire an additional 7,763 net acres
in New Mexico.  (Refer to Note 3) In addition,  we acquired leases in Texas (the
"Quachita Prospect").  To date the Company has acquired  approximately 1,971 net
acres.  During the production testing and evaluation period on the first well on
the property,  the Boggs #1, four of the five tested zones produced  significant
volumes of natural gas. Analysis of the gas indicates a "sweet"  condensate rich
gas with BTU values of 1,000.  This quality will yield a premium  price over the
current U.S.  average  natural gas price.  As formation  water was also produced
with the  natural  gas in the  tested  zones,  the Boggs #1 is  currently  under
evaluation.

GOING CONCERN
The Company  commenced  operations  on October 19, 2004 and has not realized any
revenues  since  inception.  As of June 30, 2009, the Company has an accumulated
deficit of $7,249,829 and a working capital deficit of $803,555.  The ability of
the Company to continue as a going  concern is dependent  on raising  capital to
fund ongoing operations and carry out its business plan and ultimately to attain
profitable operations.  Accordingly, these factors raise substantial doubt as to
the Company's ability to continue as a going concern. The financials  statements
do not include any adjustments relating to the recoverability and classification
of recorded  assets,  or the amounts of and  classification  of liabilities that
might be necessary in the event the company  cannot  continue in  existence.  To
date the Company has funded its initial  operations by way of private placements
of common stock and advances from related parties.

UNAUDITED INTERIM FINANCIAL STATEMENTS
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for financial information and with
the  instructions  to Form  10-Q of  Regulation  S-X.  They do not  include  all
information  and  footnotes   required  by  United  States  generally   accepted
accounting  principles for complete  financial  statements.  However,  except as
disclosed  herein,  there  has  been  no  material  changes  in the  information
disclosed in the notes to the financial  statements  for the year ended December
31, 2008  included in the  Company's  Annual  Report on Form 10-K filed with the
Securities and Exchange Commission. The unaudited financial statements should be
read in conjunction with those financial  statements  included in the Form 10-K.
In the opinion of management,  all adjustments  considered  necessary for a fair
presentation, consisting solely of normal recurring adjustments, have been made.
Operating  results for the six months  ended June 30,  2009 are not  necessarily
indicative of the results that may be expected for the year ending  December 31,
2009.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
________________________________________________________________________________

ORGANIZATION
The Company  was  incorporated  on October 19, 2004 in the State of Nevada.  The
Company's fiscal year end is December 31.

BASIS OF PRESENTATION
These financial  statements are presented in United States dollars and have been
prepared  in  accordance  with  United  States  generally  accepted   accounting
principles.

OIL AND GAS PROPERTIES
The  Company  follows  the full cost  method of  accounting  for its oil and gas
operations  whereby all costs related to the acquisition of methane,  petroleum,
and natural gas interests are capitalized. Under this method, all productive and
non-productive  costs  incurred  in  connection  with  the  exploration  for and
development of oil and gas reserves are capitalized. Such costs include land and
lease acquisition  costs,  annual carrying charges of non-producing  properties,
geological and geophysical costs, costs of drilling and equipping productive and
non-productive  wells,  and direct  exploration  salaries and related  benefits.
Proceeds from the disposal of oil and gas properties are recorded as a reduction
of the related  capitalized  costs without  recognition of a gain or loss unless
the  disposal  would  result in a change of 20 percent or more in the  depletion
rate. The Company currently operates solely in the U.S.


                                       8


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________

OIL AND GAS PROPERTIES (CONTINUED)
Depreciation  and depletion of proved oil and gas  properties is computed on the
units-of-production   method  based  upon  estimates  of  proved  reserves,   as
determined by  independent  consultants,  with oil and gas being  converted to a
common unit of measure based on their relative energy content.

The costs of acquisition  and  exploration  of unproved oil and gas  properties,
including  any  related  capitalized   interest  expense,  are  not  subject  to
depletion,  but  are  assessed  for  impairment  either  individually  or  on an
aggregated  basis. The costs of certain  unevaluated  leasehold acreage are also
not  subject to  depletion.  Costs not  subject to  depletion  are  periodically
assessed for possible  impairment  or  reductions  in  recoverable  value.  If a
reduction in  recoverable  value has  occurred,  costs  subject to depletion are
increased or a charge is made  against  earnings  for those  operations  where a
reserve base is not yet established.

Estimated future removal and site  restoration  costs are provided over the life
of  proven  reserves  on  a  units-of-production  basis.  Costs,  which  include
production equipment removal and environmental  remediation,  are estimated each
period by management based on current regulations, actual expenses incurred, and
technology and industry  standards.  The charge is included in the provision for
depletion and depreciation and the actual  restoration  expenditures are charged
to the accumulated provision amounts as incurred.

The Company applies a ceiling test to capitalized  costs which limits such costs
to the aggregate of the estimated  present value,  using a ten percent  discount
rate of the estimated  future net revenues from production of proven reserves at
year end at market  prices less future  production,  administrative,  financing,
site  restoration,  and  income  tax costs  plus the lower of cost or  estimated
market value of unproved  properties.  If  capitalized  costs are  determined to
exceed estimated future net revenues,  a write-down of carrying value is charged
to depletion in the period.

ASSET RETIREMENT OBLIGATIONS
The Company has adopted the  provisions of SFAS No. 143,  "Accounting  for Asset
Retirement Obligations." SFAS No. 143 requires the fair value of a liability for
an asset  retirement  obligation  to be  recognized in the period in which it is
incurred  if a  reasonable  estimate of fair value can be made.  The  associated
asset  retirement  costs are  capitalized as part of the carrying  amount of the
related oil and gas properties.

USE OF ESTIMATES
The preparation of financial  statements in conformity  with 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 period.  Actual results
could differ from those  estimates.  Significant  areas  requiring  management's
estimates  and  assumptions  are  the   determination   of  the  fair  value  of
transactions  involving  common  stock and  financial  instruments.  Other areas
requiring estimates include deferred tax balances and asset impairment tests.

CASH AND CASH EQUIVALENTS
For the statements of cash flows, all highly liquid investments with maturity of
three months or less are considered to be cash  equivalents.  There were no cash
equivalents  as of June 30, 2009 and December 31, 2008 that  exceeded  federally
insured limits.

FINANCIAL INSTRUMENTS
The fair  value of the  Company's  financial  assets and  financial  liabilities
approximate their carrying values due to the immediate or short-term maturity of
these financial instruments.

EARNINGS (LOSS) PER COMMON SHARE
Basic earnings (loss) per share includes no dilution and is computed by dividing
income available to common stockholders by the weighted average number of common
shares  outstanding for the period.  Dilutive earnings (loss) per share reflects
the  potential  dilution of  securities  that could share in the earnings of the
Company.  Dilutive  earnings (loss) per share is equal to that of basic earnings
(loss) per share as the effects of stock options and warrants have been excluded
as they are anti-dilutive.


                                       9


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________

INCOME TAXES
The Company follows the liability  method of accounting for income taxes.  Under
this method,  deferred tax assets and  liabilities are recognized for the future
tax  consequences  attributable to differences  between the financial  statement
carrying  amounts of existing assets and  liabilities  and their  respective tax
balances.  Deferred tax assets and  liabilities  are measured  using  enacted or
substantially  enacted tax rates  expected to apply to the taxable income in the
years in which those  differences  are expected to be recovered or settled.  The
effect  on  deferred  tax  assets  and  liabilities  of a change in tax rates is
recognized  in income in the  period  that  includes  the date of  enactment  or
substantive  enactment.  As at June 30, 2009, the Company had net operating loss
carryforwards,  however, due to the uncertainty of realization,  the Company has
provided a full valuation  allowance for the deferred tax assets  resulting from
these loss carryforwards.

STOCK-BASED COMPENSATION
On January 1, 2006, the Company adopted the fair value recognition provisions of
Financial Accounting Standards Board ("FASB") Statement No. 123(R),  SHARE-BASED
PAYMENT,   ("SFAS   123R").   The   Company   adopted   SFAS   123R   using  the
modified-prospective-transition  method.  Under this method,  compensation  cost
recognized for the year ended December 31, 2006 includes:  a) compensation  cost
for all share-based payments granted prior to, but not yet vested as of December
31, 2005,  based on the grant-date  fair value  estimated in accordance with the
original  provisions of SFAS 123, and b)  compensation  cost for all share-based
payments  granted  subsequent to December 31, 2005, based on the grant-date fair
value  estimated in  accordance  with the  provisions of SFAS 123R. In addition,
deferred  stock  compensation  related to  non-vested  options is required to be
eliminated  against  additional  paid-in capital upon adoption of SFAS 123R. The
results for the prior periods were not restated.

The Company accounts for equity  instruments  issued in exchange for the receipt
of goods or services from other than  employees in accordance  with SFAS No. 123
and the conclusions  reached by the Emerging Issues Task Force ("EITF") in Issue
No.  96-18.  Costs  are  measured  at the  estimated  fair  market  value of the
consideration  received or the  estimated  fair value of the equity  instruments
issued,  whichever is more reliably measurable.  The value of equity instruments
issued for  consideration  other than  employee  services is  determined  on the
earliest  of a  performance  commitment  or  completion  of  performance  by the
provider of goods or services as defined by EITF 96-18.

RECENT ACCOUNTING PRONOUNCEMENT
In May 2009, the FASB issued SFAS No. 165,  SUBSEQUENT EVENTS ("SFAS 165"). SFAS
165  provides   authoritative   accounting   literature  related  to  evaluating
subsequent events that was previously addressed only in the auditing literature,
and is largely similar to the current  guidance in the auditing  literature with
some  exceptions  that are not  intended  to result in  significant  changes  in
practice. SFAS 165 defines subsequent events and also requires the disclosure of
the date through which an entity has evaluated  subsequent  events and the basis
for that date.  SFAS 165 is  effective  on a  prospective  basis for  interim or
annual  financial  periods  ending  after June 15,  2009.  The  adoption of this
standard  during the period did not have any impact on the  Company's  financial
position, cash flows or results of operations.

In June 2009, the FASB issued  Statement of Financial  Accounting  Standards No.
166,  "Accounting  for Transfers of Financial  Assets,  an amendment to SFAS No.
140,"  ("SFAS  166").   SFAS  166   eliminates  the  concept  of  a  "qualifying
special-purpose  entity," changes the requirements for  derecognizing  financial
assets,  and requires  additional  disclosures  in order to enhance  information
reported to users of  financial  statements  by providing  greater  transparency
about transfers of financial assets, including securitization transactions,  and
an entity's  continuing  involvement  in and  exposure  to the risks  related to
transferred  financial assets.  SFAS 166 is effective for fiscal years beginning
after  November  15, 2009.  The Company will adopt SFAS 166 in fiscal 2010.  The
Company  does not  expect  that the  adoption  of SFAS 166 will have a  material
impact on the financial statements.

In June 2009, the FASB issued  Statement of Financial  Accounting  Standards No.
167, "Amendments to FASB Interpretation No. 46(R)," ("SFAS 167"). The amendments
include:  (1) the  elimination of the exemption for qualifying  special  purpose
entities,   (2)  a  new  approach  for  determining  who  should  consolidate  a
variable-interest  entity,  and (3) changes to when it is  necessary to reassess
who should consolidate a variable-interest entity. SFAS 167 is effective for the
first annual reporting period beginning  after November 15, 2009 and for interim


                                       10


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________

RECENT ACCOUNTING PRONOUNCEMENT (CONTINUED)

periods within that first annual reporting  period.  The Company will adopt SFAS
167 in fiscal  2010.  The Company  does not expect that the adoption of SFAS 167
will have a material impact on the financial statements.

In June 2009, the FASB issued  Statement of Financial  Accounting  Standards No.
168, "The FASB Accounting Standards  Codification and the Hierarchy of Generally
Accepted Accounting  Principles," ("SFAS 168"). SFAS 168 replaces FASB Statement
No. 162,  "The  Hierarchy  of Generally  Accepted  Accounting  Principles",  and
establishes the FASB Accounting Standards  Codification  ("Codification") as the
source  of  authoritative  accounting  principles  recognized  by the FASB to be
applied by nongovernmental  entities in the preparation of financial  statements
in conformity with generally accepted accounting  principles ("GAAP").  SFAS 168
is effective for interim and annual periods ending after September 15, 2009. The
Company  will begin to use the new  Codification  when  referring to GAAP in its
annual  report on Form 10-K for the fiscal year ending  December 31, 2009.  This
will not have an impact on the results of the Company.

NOTE 3 - OIL AND GAS PROPERTIES
________________________________________________________________________________

(a) QUACHITA PROSPECT
The Company has leased  various  properties  totalling  approximately  1,971 net
acres within the Quachita Trend within the state of Texas for a three year term,
all expiring  during the year ended 2009, in  consideration  for  $338,353.  The
Company has a 100% Working Interest and a 77% N.R.I. in the leases.

BOGGS #1
On June 7, 2007,  the  Company  began  drilling  its first well on the  Quachita
Prospect  (Boggs  #1).  During  2007 the Company  began  production  testing and
evaluation  of the well. Of the five tested  zones,  four  produced  significant
volumes of natural gas. As formation  water was also  produced  with the natural
gas in the tested zones, the Boggs # 1 is currently under  evaluation.  To date,
$1,357,208  has been  incurred on drilling and  completion  expenditures  on the
Boggs #1. The Boggs #1 was initially privately funded with the funding investors
receiving a 75% Working  Interest and a 54% Net Revenue Interest in exchange for
providing 100% of all drilling and completion  costs.  To December 31, 2007, the
Company had incurred  $1,335,781 of costs on Boggs #1 and had received  $759,000
in funding from the private investors. On March 24, 2008, the Company negotiated
with the funding  investors to acquire their  interest in the well for an amount
equal to the  total  amount  of their  initial  investment  being  $759,000  and
forgiveness  of any  additional  amounts  owing.  Effective  March 24, 2008, the
Company  completed  this  acquisition  and  settlement  through the  issuance of
1,265,000 shares of common stock at $0.63 per share (refer to Note 4).

(b) NEW MEXICO PROSPECT
The Company to date has leased various properties totalling  approximately 7,576
net acres  within the state of New Mexico for a five year term in  consideration
for $112,883. The Company has a 100% Working Interest and an 84.5% N.R.I. in the
leases.  On October 31, 2008,  the Company  entered into an agreement to acquire
from Westrock Land Corp.  approximately  5,763  additional net acres of property
within  the  State of New  Mexico  for a five  year  term in  consideration  for
$388,150.   The  Company   optioned  to  acquire  a  100%  working  interest  in
approximately   5,763  net  acres;   and  an  81.5%  N.R.I.  in  the  leases  in
approximately  5,763 net acres. Under the terms of the agreement the Company had
until April 16, 2009 to complete  the  transactions.  The Option  Agreement  was
subsequently  extended  on March 31,  2009 and June 1, 2009  whereby  the option
period has been extended to September 15, 2009.

Subsequent  to the period on July 9, 2009,  the  Company  entered  into a Letter
Agreement  with FormCap Corp.  ("FormCap"),  for joint drilling on the Company's
New Mexico  prospect.  FormCap is required to drill and  complete  two  mutually
defined  targets on the  Company's  leases in return  for an earned 50%  Working
Interest in the entire New Mexico Prospect. (Refer to note 7).


                                       11


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 3 - OIL AND GAS PROPERTIES (CONTINUED)
________________________________________________________________________________

(c) OKLAHOMA PROSPECT

On May 28,  2009,  the Company  entered  into a Letter  Agreement  with  Bonanza
Resources  Corporation  ("Bonanza")  for an  option  to earn a 60%  interest  of
Bonanza's  85%  interest  in the  North  Fork 3-D  prospect  in  Beaver  County,
Oklahoma.  The parties intend to enter into a definitive agreement regarding the
option and purchase of the 60% interest within 60 days. A non-refundable payment
of $150,000 will be paid to Bonanza,  whereby Bonanza will grant Morgan Creek an
exercise  period of one year. As per a verbal  agreement,  the 60 day period has
been extended to August 17, 2009.

In  order  to  exercise  the  option,  the  Company  will be  required  to incur
$2,400,000 in  exploration  and drilling  expenditures  during the Option Period
which will be one year. In the event that Morgan Creek does not do so the option
will terminate, Morgan Creek will cease to have any interest in the prospect and
Bonanza will retain the benefit of any drilling or exploration expenditures made
by Morgan Creek during the Option Period.

NOTE 4 - STOCKHOLDERS' EQUITY (DEFICIT)
________________________________________________________________________________

(a) SHARE CAPITAL
The Company's  capitalization  is  66,666,666  common shares with a par value of
$0.001 per share.

On April 22, 2008, the directors of the Company approved a special resolution to
undertake a reverse split of the common stock of the Company on a basis of 1 new
share for 3 old shares.  On July 26, 2006, the directors of the Company approved
a special resolution to undertake a further forward split of the common stock of
the  Company on a basis of 2 new shares for 1 old share.  On May 10,  2006,  the
directors of the Company  approved a special  resolution  to undertake a forward
split of the  common  stock of the  Company on a basis of 2 new shares for 1 old
share.  On July 14,  2009,  the  directors  of the  Company  approved  a special
resolution  to undertake a forward split of the common stock of the Company on a
basis of 2 new shares for 1 old share.

All references in these financial  statements to number of common shares,  price
per share and weighted average number of common shares  outstanding prior to the
2:1 forward stock split on May 10, 2006, the 2:1 forward split on August 8, 2006
and the 3:1 reverse  stock split on April 22, 2008 and the 2:1 forward  split on
August  3,  2009,  have  been  adjusted  to  reflect  these  stock  splits  on a
retroactive basis, unless otherwise noted.

On December 19, 2006, a founding  shareholder of the Company returned  8,000,000
restricted  shares of common stock to treasury and the shares were  subsequently
cancelled  by  the  Company.  The  shares  were  returned  to  treasury  for  no
consideration to the shareholder.

(b) PRIVATE PLACEMENTS
On November 26, 2004,  the Company  issued  4,133,332  shares of common stock at
$0.0375 per share for proceeds of $155,000.

On December 15, 2004,  the Company  issued  5,033,334  shares of common stock at
$0.0375 per share for proceeds of $188,750 and 1,760,534  shares of common stock
at $0.1875 per share for proceeds of $330,100.

On March 9, 2005,  the Company  issued 186,666 shares of common stock at a price
of $0.1875 per share for proceeds of $35,000.

On October 16, 2006,  the Company  completed a private  placement  consisting of
629,404 units at $2.25 per unit for proceeds of  $1,416,158.  Each unit consists
of one common share and one non-transferable  share purchase warrant exercisable
at $4.50 per share for the period  commencing  on October 16, 2006 and ending on
October 16, 2008,  being the day which is the earlier of 24 months from the date
of  issuance  of the units or 18  months  from the  effective  date of a planned
registration statement.  Of this private placement,  375,556 of the units issued
were  in  exchange  for  $845,000  previously  advanced  to  the  Company  by  a
shareholder.  The  estimated  fair value of the warrants at the date of grant of
$592,210,  which has been included in additional paid in capital, was determined
using the  Black-Scholes  option pricing model with an expected life of 2 years,
risk  free  interest  rate of  4.49%,  a  dividend  yield of 0% and an  expected
volatility of 153%.


                                       12


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 4 - STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
________________________________________________________________________________

(b) PRIVATE PLACEMENTS (CONTINUED)

During 2008, the Company completed a private  placement  consisting of 2,448,000
units at  $0.375  per unit for  total  gross  proceeds  of  $918,000.  Each unit
consists of one common share and one  non-transferable  share  purchase  warrant
exercisable  at $0.75 per share for a period of 12 months from the date of share
issuance.  A finders fee of 3.5%  ($20,913)  was paid on $597,500 of the private
placement proceeds received.

Subsequent  to  June  30,  2009,  the  Company  completed  a  private  placement
consisting of 1,960,000  units at $0.125 per unit for total proceeds of $245,000
of which  $65,000 had been  received as of June 30, 2009.  Each unit consists of
one common share and one non-transferable  share purchase warrant exercisable at
$0.25 per share for a period of 12 months from the date of  issuance.  A finders
fee of 7%  ($3,500)  was  paid on  $50,000  of the  private  placement  proceeds
received

(c) OTHER ISSUANCES
On February 13, 2008, the Company issued  5,050,712  shares of common stock at a
price of $0.375 per share on settlement  of related  party  advances and accrued
interest totaling $1,515,214. The difference between the estimated fair value of
the common  shares  issued at issuance and the amount of debt  settled  totaling
$378,803 was recorded as a finance cost during the period (refer to Note 6).

On March 24,  2008,  the Company  issued  3,057,076  shares of common stock at a
price of $0.315  per share on  settlement  of  related  party  advances  and the
acquisition  of the  interest  in the  Boggs  #1 well  totalling  $962,980.  The
difference between the estimated fair value of the common shares at issuance and
the amount of debt  settled  totaling  $45,857 was  recorded  as a finance  cost
during the period (refer to Notes 3 and 6).

Subsequent to June 30, 2009,  the Company issued  1,640,000  units at $0.125 per
unit on settlement of related party advances of $200,000 and accounts payable of
$5,000.  Each unit consists of one common share and one  non-transferable  share
purchase  warrant  exercisable at $0.25 per share for a period of 12 months from
the date of issuance (refer Note 6 & 7)

(d) SHARE PURCHASE WARRANTS
Details of the Company's  share purchase  warrants  issued and outstanding as of
June 30, 2009 are as follows:

Exercise price     Number of warrants to purchase shares       Expiry Date
_____________________________________________________________________________

    $0.75                       1,654,000                    October 23, 2009


The Company's  share  purchase  warrants  activity for the period ended June 30,
2009 is summarized as follows:

<TABLE>
<CAPTION>

                                                                 Weighted average exercise        Weighted average remaining
                                         Number of Warrants           Price per share           In contractual life (in years)
______________________________________________________________________________________________________________________________
<S>                                          <C>                          <C>                                <C>

Balance, December 31, 2007                     629,404                    $ 4.50                             0.80
Issued                                       2,448,000                      0.75                                -
Expired                                       (629,404)                     4.50                                -
Exercised                                            -                         -                                -
______________________________________________________________________________________________________________________________

Balance, December 31, 2008                   2,448,000                      0.75                             0.71
Issued                                               -                         -                                -
Expired                                       (794,000)                     0.75                                -
Exercised                                            -                         -                                -
______________________________________________________________________________________________________________________________

Balance, June 30, 2009                       1,654,000                    $ 0.75                             0.31
==============================================================================================================================

</TABLE>


                                       13


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 4 - STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
________________________________________________________________________________

(d) SHARE PURCHASE WARRANTS (CONTINUED)

All warrants are exercisable as at June 30, 2009.

Subsequent to June 30, 2009, the Company issued 3,600,000  warrants  exercisable
at $0.25 per share for a period of 12 months from the date of issuance.

NOTE 5 - STOCK OPTION PLAN
________________________________________________________________________________

On April 3, 2006, the Board of Directors of the Company  ratified,  approved and
adopted a Stock  Option Plan for the Company in the amount of  3,333,334  shares
with an exercisable period up to 10 years. In the event an optionee ceases to be
employed by or to provide  services to the Company for reasons other than cause,
any Stock  Option that is vested and held by such  optionee  may be  exercisable
within up to ninety  calendar  days after the  effective  date that his position
ceases. No Stock Option granted under the Stock Option Plan is transferable. Any
Stock  Option held by an optionee at the time of his death may be  exercised  by
his estate  within one year of his death or such  longer  period as the Board of
Directors may  determine.  On April 28, 2008,  the Board of Directors  deemed it
necessary  to approve an  amendment  to the Stock Option Plan to an aggregate of
5,000,000 shares.

As approved by the Board of Directors, on December 12, 2006, the Company granted
1,233,336  stock options to certain  officers,  directors and  management of the
Company at $1.65 per share.  The term of these options are five years. The total
fair value of these  options at the date of grant was estimated to be $1,527,170
and was recorded as a stock based  compensation  expense  during 2006.  The fair
value of these  options was estimated  using the  Black-Scholes  option  pricing
model  with the  following  assumptions:  expected  life of 3 years;  risk  free
interest rate of 4.49%; dividend yield of 0% and expected volatility of 187%.

As approved by the Board of  Directors on April 30,  2008,  the Company  granted
2,500,000  stock options to certain  officers,  directors and  management of the
Company at $0.50 per share.  The term of these options are ten years.  The total
fair value of these  options at the date of grant was  estimated  to be $436,955
and was recorded as a stock based  compensation  expense during the period.  The
fair value of these options was estimated using the Black-Scholes option pricing
model  with the  following  assumptions:  expected  life of 10 years;  risk free
interest rate of 3.77%; dividend yield of 0% and expected volatility of 210%.

Subsequent to June 30, 2009 on July 14, 2009,  the Company  cancelled  3,566,670
stock options to certain  officers,  directors and management of the Company and
authorized  the issuance of  3,000,000  new stock  options to certain  officers,
directors and management of the Company at $0.25 per share.  The term of the new
options is ten years.

The  Company's  stock  option  activity  for the period  ended June 30,  2009 is
summarized as follows:

<TABLE>
<CAPTION>

                                                                  Weighted average exercise       Weighted average remaining
                                         Number of Options             Price per share          In contractual life (in years)
______________________________________________________________________________________________________________________________
<S>                                          <C>                          <C>                                <C>

Balance, December 31, 2007                   1,233,336                    $ 1.65                             3.95
Granted                                      2,500,000                      0.50                                -
Expired                                              -                         -                                -
Exercised                                            -                         -                                -
____________________________________________________________________________________________________________________________

Balance, December 31, 2008                   3,733,336                      0.88                             7.22
Granted                                              -                         -                                -
Expired                                              -                         -                                -
Exercised                                            -                         -                                -
____________________________________________________________________________________________________________________________

Balance, June 30, 2009                       3,733,336                    $ 0.88                             6.72
==============================================================================================================================

</TABLE>

All options are exercisable as at June 30, 2009.


                                       14


<PAGE>


                            MORGAN CREEK ENERGY CORP.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 6 - RELATED PARTY TRANSACTIONS
________________________________________________________________________________

As of December 31, 2007,  $1,365,500 was owed to a shareholder for advances made
to the  Company.  During 2008,  this  shareholder  made further  advances to the
Company of $885,000 and $500,000 was repaid to the shareholder.  On February 13,
2008, the Company issued  5,050,712  shares of common stock at a price of $0.375
per share on settlement of related  party advance and related  accrued  interest
totaling  $1,894,017 (Refer to Note 4). During the period, this shareholder made
further  advances  of  $100,000.  As a  result,  as of June 30,  2009,  $410,000
(December 31, 2008 - $310,000) was owed which bears interest at 8% per annum and
has no specific repayment terms. As of June 30, 2009, total accrued interest was
$33,767 (December 31, 2008 - $19,164).

Subsequent to June 30, 2009,  the Company issued  1,600,000  units at $0.125 per
unit on settlement of  shareholder  advances of $200,000.  Each unit consists of
one common share and one non-transferable  share purchase warrant exercisable at
$0. 25 per share for a period of 12 months from the date of issuance.

MANAGEMENT FEES
During the six month period ended June 30, 2009, the Company  incurred  $110,600
(2008  -$151,500) for management fees to officers and directors.  As of June 30,
2009, total amount owing in accrued and unpaid management fees was $43,845 (2008
- $nil).

NOTE 7 - SUBSEQUENT EVENTS
________________________________________________________________________________

On July 9, 2009, the Company entered into a Letter  Agreement with FormCap,  for
joint  drilling on the  Company's  New Mexico  prospect.  FormCap is required to
drill and complete  two  mutually  defined  targets on the  Company's  leases in
return for an earned 50% Working Interest in the entire New Mexico Prospect.

On July 14,  2009,  the Company  cancelled  3,566,670  stock  options to certain
officers, directors and management of the Company and authorized the issuance of
3,000,000 new stock options to certain officers, directors and management of the
Company at $0.25 per share. The term of the new options is ten years.

Subsequent  to  June  30,  2009,  the  Company  completed  a  private  placement
consisting of 1,960,000  units at $0.125 per unit for total proceeds of $245,000
of which  $65,000 had been  received as of June 30, 2009.  Each unit consists of
one common share and one non-transferable  share purchase warrant exercisable at
$0.25 per share for a period of 12 months from the date of  issuance.  A finders
fee of 7%  ($3,500)  was  paid on  $50,000  of the  private  placement  proceeds
received (refer Note 4).

Subsequent to June 30, 2009,  the Company issued  1,640,000  units at $0.125 per
unit on settlement of related party advances of $200,000 and accounts payable of
$5,000.  Each unit consists of one common share and one  non-transferable  share
purchase  warrant  exercisable at $0.25 per share for a period of 12 months from
the date of issuance.

On July 14, 2009, the directors of the Company approved a special  resolution to
undertake a forward split of the common stock of the Company on a basis of 2 new
shares for 1 old share. The forward stock split became effective August 3, 2009.

The Letter Agreement with Bonanza  Resources  Corporation  ("Bonanza") dated May
28, 2009 for an option to earn a 60% interest of  Bonanza's  85% interest in the
North Fork 3-D prospect in Beaver County,  Oklahoma.  As per a verbal agreement,
the 60 day period due diligence period has been extended to August 17, 2009.


                                       15


<PAGE>


                           FORWARD LOOKING STATEMENTS

Statements  made in this Form 10-Q that are not  historical or current facts are
"forward-looking  statements"  made  pursuant to the safe harbor  provisions  of
Section  27A of the  Securities  Act of 1933 (the  "Act") and Section 21E of the
Securities Exchange Act of 1934. These statements often can be identified by the
use  of  terms  such  as  "may,"  "will,"  "expect,"  "believe,"   "anticipate,"
"estimate," "approximate" or "continue," or the negative thereof. We intend that
such  forward-looking  statements  be  subject  to the  safe  harbors  for  such
statements.  We wish to caution  readers not to place undue reliance on any such
forward-looking  statements,   which  speak  only  as  of  the  date  made.  Any
forward-looking  statements represent  management's best judgment as to what may
occur in the future. However,  forward-looking  statements are subject to risks,
uncertainties  and important  factors beyond our control that could cause actual
results and events to differ  materially from  historical  results of operations
and events  and those  presently  anticipated  or  projected.  We  disclaim  any
obligation  subsequently  to revise any  forward-looking  statements  to reflect
events or  circumstances  after the date of such  statement  or to  reflect  the
occurrence of anticipated or unanticipated events.

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

GENERAL

Morgan Creek Energy Corp. is a corporation organized under the laws of the State
of Nevada. After the effective date of our registration statement filed with the
Securities and Exchange Commission  (February 14, 2006), we commenced trading on
the Over-the-Counter  Bulletin Board under the symbol "MCRE:OB" (currently under
the  symbol"MCKE:OB").  We are engaged in the business of exploration of oil and
gas bearing  properties in the United States.  Our shares are also traded on the
Frankfurt Stock Exchange in Germany under the symbol "M6C".

Please note that throughout this Quarterly  Report,  and unless otherwise noted,
the words "we," "our," "us," the "Company," or "Morgan  Creek," refers to Morgan
Creek Energy Corp.

RECENT DEVELOPMENTS

AUGUST 3, 2009 FORWARD STOCK SPLIT

On July 14,  2009,  our  Board of  Directors  pursuant  to a Board of  Directors
meeting  authorized  and  approved a forward  stock  split of two for one of our
total issued and outstanding shares of common stock (the "Forward Stock Split").

The Forward Stock Split was  effectuated  based on market  conditions and upon a
determination  by our Board of Directors that the Forward Stock Split was in our
best interests and of the shareholders. Certain factors were discussed among the
members of the Board of  Directors  concerning  the need for the  Forward  Stock
Split,  including  the  increased  potential  for  financing.  The intent of the
Forward Stock Split is to increase the marketability of our common stock.


                                       16


<PAGE>


The  Forward  Stock  Split was  effectuated  on August 3, 2009 upon  filing  the
appropriate  documentation  with NASDAQ.  The Forward Stock Split  increased our
total  issued  and  outstanding  shares  of  common  stock  from  17,016,196  to
approximately  34,032,392 shares of common stock. The common stock will continue
to be $0.001 par value.

Amendment to Articles of Incorporation

Commensurate  with the Forward  Stock Split,  the  authorized  share capital was
increased from 33,333,333  shares of common stock to 66,666,666 shares of common
stock with a par value of $0.001 per share.  An  amendment  to our  Articles  of
Incorporation  was filed with the  Nevada  Secretary  of State on July 31,  2009
affecting the increase in our authorized capital.

CURRENT BUSINESS OPERATIONS

We are a natural resource  exploration and production  company currently engaged
in the exploration, acquisition and development of oil and gas properties in the
United States and within North  America.  Our primary  activity and focus is our
leases in New Mexico (the "New Mexico  Prospect").  The leases are  unproven and
were acquired for  approximately  $338,000.  We have leased  various  properties
totaling  approximately  7,576 net acres  within  the State of New  Mexico for a
five-year term in  consideration  for $112,883.  We have a 100% working interest
and an 84.5% net revenue interest in the leases.  In addition,  we have acquired
leases  in  Texas  (the  "Quachita   Prospect").   To  date,  we  have  acquired
approximately 1,971 net acres within the Quachita Prospect in the State of Texas
for a  three-year  term all expiring  during the year ended 2009.  We acquired a
100%  working  interest  and a 77% net revenue  interest in natural gas targeted
Quachita Prospect leases.

OIL AND GAS PROPERTIES

The acreage and location of our oil and gas properties is summarized as follows:

                                  NET ACRES(*)

     Texas                           1,971
     New Mexico                      7,576
                                     _____
     Total:                          9,547

     (*) Certain of our interests in our oil and gas properties may be less than
     100%.  Accordingly,  we  have  presented  the  acreage  of our  oil and gas
     properties on a net acre basis.

QUACHITA PROSPECT

As of the date of this Quarterly Report, we lease  approximately 1,971 net acres
within  the  Quachita  Trend  in the  State of Texas  for a  three-year  term in
consideration of approximately  $338,000.  We have a 100% working interest and a
77% net revenue interest in the Quachita Prospect leases.


                                       17


<PAGE>


BOGGS #1 WELL.  We completed  the drilling  portion of the Boggs #1 well on July
13, 2007. Subsequently,  we began production testing and evaluation of the well.
Of the five tested zones, four produced  significant  volumes of natural gas. As
formation water was also produced with the natural gas in the tested zones,  the
Boggs #1 is currently under evaluation. We intend to secure all immediate rights
relating to oil and gas in the areas providing  control over any potential major
structural play that develops as a result of this in-depth exploration.

The Boggs #1 had been privately  funded with the funding  investors  receiving a
75% working  interest and a 54% net revenue  interest in exchange for  providing
100% of all drilling and completion costs.  Therefore,  we initially  retained a
25% working  interest and a 23% net revenue interest in the Boggs #1 well. As of
June 30, 2009, we incurred  $1,357,208 in drilling and completion  costs.  As of
June 30,  2009,  we had  received a total of  $759,000 in funding  from  private
investors.  On March 24,  2008,  we  negotiated  with the funding  investors  to
acquire  their  interest in the Boggs #1 for $759,000  (which amount is equal to
the total amount of the funding investors'  initial  investment) and forgiveness
of any additional  amounts owing.  Effective on March 24, 2008, we completed the
acquisition  and  settlement  through the  issuance of  2,530,000  shares of our
restricted  common  stock at  $0.315  per  share.  The  difference  between  the
estimated fair value of the common shares at issuance and the amount of the debt
settled totaling $37,950 was recorded as a finance cost.

NEW MEXICO PROSPECT

As of the date of this Quarterly  Report,  we have leased various  properties in
the New Mexico Prospect totaling  approximately 7,576 net acres within the State
of New Mexico for a five year term in consideration for $112,883. We have a 100%
working interest and an 84.5% net revenue interest in the leases  comprising the
New Mexico Prospect.

WESTROCK LAND CORP. OPTION  AGREEMENT.  Effective on October 31, 2008, our Board
of  Directors  authorized  the  execution  of an option  agreement  (the "Option
Agreement") with Westrock Land Corp, a private Texas  corporation  ("Westrock").
In  accordance  with the terms  and  provisions  of the  Option  Agreement:  (i)
Westrock owns all right,  title and interest in and to  approximately  7,763 net
acres of property within the State of New Mexico with a net revenue  interest of
81.5%  pertaining  to 5,746 of the net acres  (the  "New  Mexico  Leases");  (b)
Westrock ; (iii) we desire to acquire a 100% working  interest in the New Mexico
Leases for a total purchase price of  approximately  $388,150;  and (iv) we have
until April 16, 2009 to complete our due diligence (the "Option Period").

The Option  Agreement  was  subsequently  extended on March 31, 2009 and June 1,
2009 whereby the option  period has been  extended to September  15, 2009. It is
anticipated that in the event the due diligence is completed satisfactory to us,
the  effective  date of  conveyance  of the  working  interest in the New Mexico
Leases to us will occur on approximately September 15, 2009.


                                       18


<PAGE>


BONANZA RESOURCES CORPORATION OPTION AGREEMENT.

Effective on June 2, 2009, our Board of Directors, pursuant to unanimous vote at
a special meeting of the Board,  authorized the execution of a letter  agreement
dated May 28, 2009 (the "Option Agreement") with Bonanza Resources (Texas) Inc.,
the  wholly  owned  subsidiary  of  Bonanza  Resources   Corporation   ("Bonanza
Resources"),  to purchase a certain percentage of Bonanza Resources' eighty-five
percent  (85%)  leasehold  interest in and to certain  leases  located in Beaver
County, State of Oklahoma (the "Bonanza Resources Interest"). In accordance with
the terms and provisions of the Option  Agreement:  (i) we have agreed to make a
non-refundable  payment to Bonanza  Resources of $150,000 within sixty (60) days
from the date of this Option Agreement; and (ii) Bonanza Resources has agreed to
grant to us an  option  having  an  exercise  period  of one year  (the  "Option
Period")  to purchase a sixty  percent  (60%)  partial  interest  (the  "Partial
Interest")  in the Bonanza  Resources  Interest.  In the event we do not pay the
$150,000  to  Bonanza  Resources  within  sixty days from the date of the Option
Agreement, the Option Agreement will terminate.

The Bonanza  Resources  Interest is held by Bonanza  Resources  pursuant to that
certain  letter  agreement  between  Bonanza  Resources,  Ryan Petroleum LLC and
Radian  Energy  L.C.  dated  February  25,  2009  (the  "Original   Agreement").
Therefore,  in the event we pay the  $150,000  to Bonanza  Resources  within the
sixty day period from the date of the Option  Agreement,  and in accordance with
the further terms and  provisions of the Option  Agreement:  (i) we shall assume
that amount of Bonanza  Resources'  right,  title and interest  and  obligations
under the Original  Agreement as is proportionate to the Partial  Interest;  and
(ii) we must incur  $2,400,000 in  exploration  and drilling  expenditures  (the
"Exploration  Expenditures")  during the Option Period.  In the event that we do
not  exercise  the  Option  Agreement,  Bonanza  shall  retain the  $150,000  as
liquidated damages for our failure to incur the Exploration Expenditures.

In the event we incur the  Exploration  Expenditures  and  exercise  the  Option
Agreement, a definitive agreement shall be executed by both parties with respect
to the Parial Interest.

FORMCAP  CORPORATION OPTION AGREEMENT

Effective on July 14, 2009,  our Board of Directors,  pursuant to unanimous vote
at a  special  meeting  of the  Board,  authorized  the  execution  of a  letter
agreement dated July 9, 2009 (the "Option  Agreement") with Formcap  Corporation
("Formcap"), to purchase a 50% working interest (40.75% net revenue interest) of
our 81.5%  leasehold  interest in and to certain leases located in Curry County,
State of New Mexico (the "Frio Draw Prospect Interest").

In accordance with the terms and provisions of the Option Agreement: (i) Formcap
has agreed to pay us a $100,000  initial payment (the "Initial  Payment") within
five business days from the completion of its due diligence; (ii) the balance of
funds for the  initial  well  will be  advanced  by  FormCap  to us within  five
business days from receipt of a mutually  agreed upon approval for  expenditure,
which  balance of such funds for the  initial  well are to be  received by us no
later than  September  8, 2009;  and (iii) the Initial  Payment  will be applied
towards the total  consideration to be paid by FormCap to us, which will include
the cost of  drilling  and  completing  two wells at a total  estimated  cost of
approximately $1,300,000.


                                       19


<PAGE>


In accordance with the further terms and provisions of the Option Agreement: (i)
FormCap  will  provide  to us the dry hole and  completion  costs  estimated  at
$650,000  in  advance  of  drilling  the  first  well;  (ii) upon  drilling  and
completion of the first well,  we will assign to FormCap a 25% working  interest
(20.375% net revenue  interest) in the Frio Draw  Prospect  Interest;  and (iii)
upon  receipt by us of the funds from  Formcap in advance of drilling the second
well, we will assign to FormCap the additional 25% working interest (20.375% net
revenue  interest).  Costs  associated with the drilling of all subsequent wells
will be shares on an equal basis between us and FormCap.

We have granted to FormCap the time period  between the date of execution of the
Option  Agreement and August 15, 2009 to complete its due diligence (the "Option
Period").
























                                       20


<PAGE>


RESULTS OF OPERATION


                                                             FOR THE PERIOD FROM
                                                              OCTOBER 19, 2004
                                 SIX MONTH PERIOD ENDED        (INCEPTION) TO
                                 JUNE 30, 2009 AND 2008         JUNE 30, 2009
                                 _________________________    __________________
STATEMENT OF OPERATIONS DATA

GENERAL AND ADMINISTRATIVE
EXPENSES
   Investor relations           $     -0-     $    33,644        $   322,018
   expenses

   Consulting expenses             15,000         177,782            871,960

   Management fees -              110,600         151,500            998,683
   related party

   Management fees -                  -0-         436,955          1,964,125
   stock based
   compensation

   Impairment of oil and              -0-             -0-          1,273,410
   gas  properties

   Office and general              66,332         127,509            588,307

   Professional Fees               58,584         120,249            694,336

NET OPERATING LOSS              $(250,516)    $(1,047,639)       $(6,712,839)

OTHER EXPENSE
   Financing Costs                    -0-        (424,660)          (424,660)
   Interest expense               (14,603)        (22,448)          (112,330)

NET LOSS                        $(265,120)    $(1,494,747)       $(7,249,829)


                                       21


<PAGE>


We have incurred  recurring  losses to date. Our financial  statements have been
prepared assuming that we will continue as a going concern and, accordingly,  do
not include adjustments relating to the recoverability and realization of assets
and classification of liabilities that might be necessary should we be unable to
continue in operation.

We expect we will  require  additional  capital to meet our long term  operating
requirements. We expect to raise additional capital through, among other things,
the sale of equity or debt securities.

SIX MONTH PERIOD ENDED JUNE 30, 2009 COMPARED TO SIX MONTH PERIOD ENDED JUNE 30,
2008

Our net loss for the  six-month  period  ended June 30,  2009 was  approximately
($265,120)  compared to a net loss of ($1,494,747)  during the six-month  period
ended June 30, 2008 (a decrease of  $1,229,627).  During the  six-month  periods
ended June 30, 2009 and 2008, we did not generate any revenue.

During the  six-month  period  ended June 30,  2009,  we  incurred  general  and
administrative   expenses  of  approximately  $250,516  compared  to  $1,047,639
incurred  during  the  six-month  period  ended  June 30,  2008 (a  decrease  of
$797,123).  These  general  and  administrative  expenses  incurred  during  the
six-month  period ended June 30, 2009  consisted  of: (i) investor  relations of
$-0- (2008: $33,644);  (ii) consulting fees of $15,000 (2008:  $177,782);  (iii)
office and  general of  $66,332  (2008:  $127,509);  (iv)  professional  fees of
$58,584 (2008: $120,249); (v) management fees - related party of $110,600 (2008:
$151,500);  and (vi) management  fees - stock based  compensation of $-0- (2008:
$436,955).

During the six-month periods ended June 30, 2009 and 2008, we did not record any
impairment of oil and gas properties.  Thus, general and administrative expenses
incurred  during the  six-month  period  ended  June 30,  2009  compared  to the
six-month period ended June 30, 2008 decreased primarily due to the reduction of
management  fees - stock based  compensation  relating to the valuation of stock
options  granted to our  officers  and  directors.  General  and  administrative
expenses  were  reduced  expenses  further  due  to  the  decrease  in  investor
relations,  consulting fees,  office and general expenses and professional  fees
relating to the decrease scope of business operations during the period. General
and administrative expenses generally include corporate overhead,  financial and
administrative contracted services, marketing, and consulting costs.

Of the  $250,516  incurred as general  and  administrative  expenses  during the
six-month period ended June 30, 2009, we incurred consulting fees of $15,000 and
management fees of $110,600 payable to our officers, managers and directors.

Financing  costs incurred  during the six-month  period ended June 30, 2009 were
$-0- (2008:  $424,660).  Our net loss during the six-month period ended June 30,
2009 was ($265,120) or ($0.01) per share compared to a net loss of  ($1,494,747)
or ($0.06)  per share  during the  six-month  period  ended June 30,  2008.  The
weighted  average number of shares  outstanding was 30,432,392 for the six-month
period ended June 30, 2009 compared to 25,352,382 for the six-month period ended
June 30, 2008.


                                       22


<PAGE>


THREE MONTH PERIOD ENDED JUNE 30, 2009 COMPARED TO THREE MONTH PERIOD ENDED JUNE
30, 2008.

Our net loss for the three  month  period  ended  June 30,  2009 was  ($150,136)
compared to a net loss of  ($805,217)  during the three month  period ended June
30, 2008 (a decrease of $655,081). During the three month periods ended June 30,
2009 and 2008, we did not generate any revenue.

During the three month  period  ended June 30,  2009,  we  incurred  general and
administrative  expenses of approximately $142,125 compared to $792,112 incurred
during the three month  period  ended June 30,  2008 (a  decrease of  $649,987).
These general and administrative expenses incurred during the three month period
ended June 30, 2009 consisted of: (i) consulting  fees of $-0- (2008:  $64,937);
(ii) office and general of $46,445 (2008:  $96,389);  (iii) professional fees of
$30,680 (2008: $68,687);  (iv) management fees - related party of $65,000 (2008:
$91,500); and (v) investor relations of $-0- (2008: $33,644) and (vi) management
fee-stock based compensation of $-0- (2008-$436,955)

During the three month periods ended June 30, 2009 and June 30, 2008, we did not
record  any   impairment  of  oil  and  gas   properties.   Thus,   general  and
administrative  expenses  incurred  during the three month period ended June 30,
2009 compared to the three month period ended June 30, 2008 decreased  primarily
due to the decrease in expenses associated with investor  relations,  consulting
fees,  office and  general and  professional  fees.  General and  administrative
expenses  generally include  corporate  overhead,  financial and  administrative
contracted services, marketing, and consulting costs.

Of the $142,125 incurred as general and administrative expenses during the three
month period ended June 30, 2009, we incurred consulting expenses of $-0- (2008-
$64,937).  We  further  incurred  management  fees  of  $65,000  payable  to our
officers, managers and directors. As of June 30, 2009, the total amount owing in
management fees was $43,845.

Interest expense during the three month periods ended June 30, 2009 and June 30,
2008 of $8,011 and $13,105,  respectively,  was recorded as other expense.  This
resulted  in a net loss of  ($150,136)  or ($0.00) per share for the three month
period ended June 30, 2009  compared to a net loss of  ($805,217) or ($0.03) per
share for the three month  period  ended June 30,  2008.  The  weighted  average
number of shares  outstanding  was  30,432,392  for the three month period ended
June 30, 2009 compared to  27,984,392  for the three month period ended June 30,
2008.

LIQUIDITY AND CAPITAL RESOURCES

AS AT JUNE 30, 2009

As at June 30, 2009, our current assets were $32,892 and our current liabilities
were $836,447, which resulted in a working capital deficiency of ($803,555).  As
at June 30, 2009,  current  assets were  comprised of: (i) $20,843 in cash;  and
(ii) $12,049 in other current assets.  As at the six month period ended June 30,
2009,  current  liabilities  were comprised of: (i) $351,434 in accounts payable
and accrued liabilities; and (ii) $485,013 in amounts due to related parties.


                                       23


<PAGE>


As at ended June 30, 2009,  our total assets were  $1,844,835  comprised of: (i)
$32,892  in  current  assets;  and  (ii)  $1,811,943  in  unproven  oil  and gas
properties.  The  slight  increase  total  assets  at ended  June 30,  2009 from
December 31, 2008 was primarily due to the increase in cash.

As at ended  June 30,  2009,  our  total  liabilities  were  $836,447  comprised
entirely of current  liabilities.  The increase in  liabilities at June 30, 2009
from December 31, 2008 was primarily due to an increase in accounts  payable and
accrued  liabilities  and  amounts  due to  related  parties.  See " -  Material
Commitments".

Stockholders'  equity  decreased  from  $1,208,509  as of  December  31, 2008 to
stockholders' equity of $1,008,388 as of June 30, 2009.

CASH FLOWS FROM OPERATING ACTIVITIES

We have not generated positive cash flows from operating activities. For the six
month period ended June 30,  2009,  net cash flows used in operating  activities
was ($150,040), consisting primarily of a net loss of ($265,120). Net cash flows
used in operating  activities was changed by $39,247  relating to an accrual due
to related parties,  interest accrued for $14,603,  prepaid expenses for $13,755
and $47,475 in accounts payable and accrued liabilities.

CASH FLOWS FROM INVESTING ACTIVITIES

For the six month period  ended June 30, 2009,  net cash flows used in investing
activities was ($9,000) for the acquisition of oil and gas properties.

CASH FLOWS FROM FINANCING ACTIVITIES

We have  financed  our  operations  primarily  from either  advancements  or the
issuance of equity and debt instruments. For the six month period ended June 30,
2009, net cash flows provided from financing activities was $165,000 compared to
$880,000 for the six month period ended June 30, 2008. Cash flows from financing
activities  for the six month period ended June 30, 2009 consisted of $65,000 in
proceeds  from  subscriptions  of common  stock and  $100,000 in  advances  from
related parties.

We expect that working capital requirements will continue to be funded through a
combination  of our  existing  funds and further  issuances of  securities.  Our
working capital requirements are expected to increase in line with the growth of
our business.

PLAN OF OPERATION AND FUNDING

Existing working capital, further advances and debt instruments, and anticipated
cash flow are expected to be adequate to fund our  operations  over the next six
months.  We have no  lines  of  credit  or other  bank  financing  arrangements.
Generally,  we have  financed  operations  to date  through the  proceeds of the
private  placement  of  equity  and debt  instruments.  In  connection  with our
business plan, management anticipates additional increases in operating expenses
and capital expenditures relating to: (i) oil and gas operating properties; (ii)
possible drilling  initiatives on current properties and future properties;  and


                                       24


<PAGE>


(iii) future  property  acquisitions.  We intend to finance these  expenses with
further issuances of securities,  and debt issuances.  Thereafter,  we expect we
will need to raise  additional  capital and generate  revenues to meet long-term
operating  requirements.  Additional  issuances  of equity or  convertible  debt
securities will result in dilution to our current  shareholders.  Further,  such
securities  might have rights,  preferences  or privileges  senior to our common
stock.  Additional  financing may not be available upon acceptable  terms, or at
all. If adequate  funds are not  available or are not  available  on  acceptable
terms,  we may not be  able  to  take  advantage  of  prospective  new  business
endeavors or opportunities,  which could  significantly and materially  restrict
our business operations.

During  fiscal year ended  December 31, 2008,  we completed a private  placement
consisting  of  2,448,000  units at the price of $0.375 per unit for total gross
proceeds of $918,000  excluding  finders fees of  ($20,913).  During fiscal year
ended December 31, 2008, we closed a private placement offering under Regulation
S of the  Securities  Act  pursuant to which we issued an aggregate of 5,050,712
shares and received  gross  proceeds of  $1,515,214,  of which all  consisted of
settlement of debt relating to amounts  previously  advanced to us by one of our
shareholders  and related  accrued  interest.  Effective March 24, 2008, we also
closed a further private placement offering under Regulation S of the Securities
Act pursuant to which we issued an  aggregate  of 3,057,076  shares and received
gross  proceeds of $962,980,  of which all  consisted of  settlement of debt and
acquisition  of the interest in the Boggs #1 well.  Effective July 14, 2009, the
Company closed a further private  placement under Regulation S of the Securities
Act  pursuant to which we issued an  aggregate  of  3,600,000  units,  each unit
consists of one common share and one  non-transferable  share  purchase  warrant
exercisable  at $0.25  per  share  for a period  of 12  months  from the date of
issuance,  and received gross proceeds of $450,000 of which $245,000 was in cash
and $205,000  consisted of  settlement  of related  party  advances and accounts
payable.

MATERIAL COMMITMENTS

During fiscal year ended  December 31, 2007, an aggregate of $1,365,500  was due
and owing to one of our shareholders relating to advances. Subsequently,  during
fiscal year ended December 31, 2008,  additional advances were made by this same
shareholder  to us of $885,000 for an  aggregate  amount of  $2,250,500  due and
owing.  During fiscal year ended  December 31, 2008, we repaid  $500,000 to this
shareholder.  Further,  the  shareholder  assigned the amount of  $1,515,214  to
various  assignees  and  settled  the  $1,515,214  pursuant  to the  issuance of
5,050,712  shares of our  restricted  common  stock at  $0.375  per  share.  The
difference between the estimated fair value of the common shares at issuance and
the amount of debt settled totaling  $378,803 was recorded as a finance cost. As
a result,  as at June 30, 2009, an aggregate  $410,000 was due and owing to this
shareholder,  which bears interest at 8% per annum and has no specific repayment
terms. As at June 30, 2009, total accrued  interest was $33,767.  Effective July
14, 2009, the Company issued 1,600,000 units at $0.125 per unit on settlement of
shareholders  advances of $200,000.  Each unit  consists of one common share and
one non-transferable share purchase warrant exercisable at $0.25 per share for a
period of 12 months from the date of issuance.


                                       25


<PAGE>


PURCHASE OF SIGNIFICANT EQUIPMENT

We do not intend to purchase any  significant  equipment  during the next twelve
months.

OFF-BALANCE SHEET ARRANGEMENTS

As of the date of this Quarterly  Report,  we do not have any off-balance  sheet
arrangements  that have or are  reasonably  likely  to have a current  or future
effect on our financial condition,  changes in financial condition,  revenues or
expenses,  results of operations,  liquidity,  capital  expenditures  or capital
resources that are material to investors.

GOING CONCERN

The independent auditors' report accompanying our December 31, 2008 and December
31, 2007  financial  statements  contains an  explanatory  paragraph  expressing
substantial  doubt  about  our  ability  to  continue  as a going  concern.  The
financial  statements  have been prepared  "assuming  that we will continue as a
going concern," which  contemplates  that we will realize our assets and satisfy
our liabilities and commitments in the ordinary course of business.

ITEM III. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Market risk represents the risk of loss that may impact our financial  position,
results of  operations or cash flows due to adverse  change in foreign  currency
and  interest  rates.

EXCHANGE RATE

Our reporting currency is United States Dollars ("USD"). In the event we acquire
any properties  outside of the United States,  the fluctuation of exchange rates
may have  positive or negative  impacts on our results of  operations.  However,
since all of our properties are currently located within the United States,  any
potential revenue and expenses will be denominated in U.S. Dollars,  and the net
income effect of appreciation  and devaluation of the currency  against the U.S.
Dollar would be limited to our costs of acquisition of property.

INTEREST RATE

Interest  rates in the United  States are  generally  controlled.  Any potential
future loans will relate mainly to  acquisition of properties and will be mainly
short-term.  However our debt may be likely to rise in connection with expansion
and if  interest  rates  were to rise at the  same  time,  this  could  become a
significant  impact  on our  operating  and  financing  activities.  We have not
entered into derivative contracts either to hedge existing risks for speculative
purposes.


                                       26


<PAGE>


ITEM IV. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

We have performed an evaluation under the supervision and with the participation
of our  management,  including  our  Chief  Executive  Officer  (CEO)  and Chief
Financial  Officer (CFO), of the  effectiveness  of our disclosure  controls and
procedures,  (as defined in Rules  13a-15(e)  and  15d-15(e)  under the Exchange
Act).  Based on that  evaluation,  our  management,  including  our CEO and CFO,
concluded that our disclosure  controls and procedures were effective as of June
30,  2009 to  provide  reasonable  assurance  that  information  required  to be
disclosed  by us in the reports  filed or submitted by us under the Exchange Act
is  recorded,  processed,  summarized  and  reported  within  the  time  periods
specified in the SEC's rules and forms.

MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal
control  over  financial  reporting  (as  defined  in Rule  13a-15(f)  under the
Exchange  Act).  Under  the  supervision  and  with  the  participation  of  our
management,  including  our CEO and CFO, we evaluated the  effectiveness  of our
internal  control over  financial  reporting as of June 30, 2009. In making this
assessment,  management  used  the  criteria  set  forth  by  the  Committee  of
Sponsoring  Organizations  of  the  Treadway  Commission  ("COSO")  in  Internal
Control-Integrated Framework.

This Quarterly  Report does not include an attestation  report of our registered
public  accounting  firm De Joya  Griffith &  Company,  LLC  regarding  internal
control  over  financial  reporting.  Management's  report  was not  subject  to
attestation by our registered public accounting firm pursuant to temporary rules
of the SEC that permit us to provide only management's  report in this Quarterly
Report on Form 10-Q.

INHERENT LIMITATIONS ON EFFECTIVENESS OF CONTROLS

We believe that a controls  system,  no matter how well  designed and  operated,
cannot provide absolute assurance that the objectives of the controls system are
met, and no  evaluation  of controls  can provide  absolute  assurance  that all
control  issues  and  instances  of fraud,  if any,  within a company  have been
detected.  Our  disclosure  controls  and  procedures  are  designed  to provide
reasonable assurance of achieving their objectives, and our CEO and our CFO have
concluded that these  controls and  procedures are effective at the  "reasonable
assurance" level.

CHANGES IN INTERNAL CONTROLS

Our management had  remediated the material  weaknesses  that were reported from
our 10-K/A for the fiscal year end December 31, 2007 which were filed on October
2, 2008.  (A)  Management  implemented  an audit  committee  that  oversees  and
monitors our financials  (See Paragraph on Audit  committee  report below).  (B)
Adequate  segregation of duties were put in place to reduce the likelihood  that
errors  (intentional or  unintentional)  will remain undetected by providing for
separate processing by different  individuals at various stages of a transaction
and for  independent  reviews  of the work  performed.  No  further  significant
changes were  implemented  in our internal  controls  over  financial  reporting
during the period covered by this report that have materially  affected,  or are
reasonably  likely to materially  affect,  our internal  control over  financial
reporting.


                                       27


<PAGE>


AUDIT COMMITTEE REPORT

The Board of Directors has  established an audit  committee.  The members of the
audit  committee  are Mr.  Marcus  Johnson,  Mr.  Angelo  Viard and Mr. D. Bruce
Horton.  All of the members of the audit committee are "independent"  within the
meaning of Rule 10A-3 under the Exchange  Act. The current  audit  committee was
organized on December 18, 2008 and operates under a written  charter  adopted by
our Board of Directors.

The audit  committee has received and reviewed the written  disclosures  and the
letter from De Joya Griffith & Company,  LLC required by Independence  Standards
Board  Standard  No. 1,  Independence  Discussions  with  Audit  Committees,  as
amended.

Based on the reviews and discussions  referred to above, the audit committee has
recommended to the Board of Directors that the financial  statements referred to
above be included in our Quarterly  Report on Form 10-Q for the six month period
ended June 30, 2009 filed with the Securities and Exchange Commission.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Management  is  not  aware  of  any  legal   proceedings   contemplated  by  any
governmental authority or any other party involving us or our properties.  As of
the date of this Quarterly  Report,  no director,  officer or affiliate is (i) a
party adverse to us in any legal proceeding,  or (ii) has an adverse interest to
us in any  legal  proceedings.  Management  is not  aware  of  any  other  legal
proceedings pending or that have been threatened against us or our properties.

ITEM 1A. RISK FACTORS

No report required.

ITEM 2. UNREGISTERED SALES OF SECURITIES AND USE OF PROCEEDS

No report required.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

No report required.

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

No report required.


                                       28


<PAGE>


ITEM 5. OTHER INFORMATION

JULY 2009 PRIVATE PLACEMENT OFFERING

Effective  July 2009,  we  completed  a private  placement  offering  (the "2009
Private Placement") with certain non-United States residents (collectively,  the
"Investors").  In accordance  with the terms and  provisions of the 2009 Private
Placement,  we issued to the Investors an aggregate of 1,960,000  units at a per
unit price of $0.125  (the  "Unit") in our  capital  for  aggregate  proceeds of
$245,000,  of which as at the date of this  Quarterly  Report  an  aggregate  of
$65,000 has been  received.  Each Unit was  comprised of one share of restricted
common stock and one non-transferable  warrant (the "Warrant").  Each Warrant is
exercisable  at  $0.25  per  share  for a period  of one  year  from the date of
issuance (the  "Exercise  Period").

The Units  under the 2009  Private  Placement  were  sold to  non-United  States
Investors  in reliance  on  Regulation  S  promulgated  under the United  States
Securities  Act of 1933,  as amended (the  "Securities  Act").  The 2009 Private
Placement has not been  registered  under the  Securities Act or under any state
securities  laws and may not be offered or sold  without  registration  with the
United States Securities and Exchange Commission or an applicable exemption from
the registration requirements.  The per share price of the Units was arbitrarily
determined  by our Board of  Directors  based upon  analysis of certain  factors
including,  but  not  limited  to,  stage  of  development  and  exploration  of
properties, industry status, investment climate, perceived investment risks, our
assets and net estimated worth. The Investors executed  subscription  agreements
and acknowledged that the securities to be issued have not been registered under
the Securities  Act, that they  understood the economic risk of an investment in
the  securities,  and that  they had the  opportunity  to ask  questions  of and
receive  answers from our management  concerning any and all matters  related to
acquisition of the securities.

DEBT SETTLEMENT

Effective  during July 2009, we issued  1,640,000  Units at a per share price of
$0.125 in accordance with the terms and provisions of a settlement agreement. We
settled an  aggregate  of  $200,000  in  related  party  advances  and $5,000 in
accounts  payable.  Each Unit was  comprised of one share of  restricted  common
stock and one non-transferable Warrant. Each Warrant is exercisable at $0.25 per
share  for a  period  of one  year  from the  date of  issuance  (the  "Exercise
Period").  The shares of common  stock were issued in reliance on  Regulation  S
promulgated  under the  Securities  Act.  The per  share  price of the Units was
arbitrarily  determined by our Board of Directors based upon analysis of certain
factors  including,  but not limited to, stage of development and exploration of
properties, industry status, investment climate, perceived investment risks, our
assets and net estimated worth.

We had adopted a stock option plan (the "2006 Stock Option  Plan"),  pursuant to
which there was an aggregate of 5,000,000  shares  available for issuance  under
the 2008 Stock Option Plan,  reduced to 3,333,334  shares in  accordance  with a
reverse stock split  effective  April 22, 2008,  and  subsequently  increased to
5,000,000 shares by Board of Director approval and resolution on April 28, 2008.
Our Board of Directors had authorized the grant of an aggregate  3,733,336 stock
options under the 2006 Stock Option Plan, of which  1,066,670 stock options were
granted  exercisable  at $1.65 per share  expiring on December 12, 2016,  taking
into effect the reverse stock split (collectively, the "2006 Stock Options") and
2,500,000 stock options were granted  exercisable at $0.50 per share expiring on
April 30, 2018 (collectively, the "2008 Stock Options").


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<PAGE>


On July 14, 2009, our Board of Directors approved the cancellation of certain of
the 2006 Stock Options and the 2008 Stock Options,  which  aggregated  3,566,670
options.  Our Board of Directors  further  approved the re-issuance of 3,000,000
stock options (the "2009 Stock  Options") to certain of our officers,  directors
and  consultants  at an  exercise  price of $0.25  for a  period  of ten  years.
Effective July 31, 2009, our Board of Directors  authorized the specific  number
of 2009  Stock  Options to be granted  to each of our  officers,  directors  and
consultants.

ITEM  6. EXHIBITS AND REPORTS ON FORM 8-K

Exhibits:

  10.1     Letter Agreement dated May 28, 2009 between Morgan Creek Energy Corp.
           and Bonanza Resources (Texas) Inc. (1)

  10.2     Letter Agreement dated July 9, 2009 between Morgan Creek Energy Corp.
           and FormCap Corporation. (2)

  31.1     Certification of Chief Executive Officer pursuant to Securities
           Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

  31.2     Certification of Chief Financial Officer pursuant to Securities
           Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

  32.1     Certifications pursuant to Securities Exchange Act of 1934
           Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted
           pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.

(1)  Incorporated  by reference  from Form 8-K filed with the Commission on June
     9, 2009.

(2)  Incorporated  by reference  from Form 8-K filed with the Commission on July
     16, 2009.


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<PAGE>


                                   SIGNATURES


     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.



                                  MORGAN CREEK ENERGY CORP.

Dated: August 7, 2009

                                  By: /s/ PETER WILSON
                                      __________________________________________
                                          Peter Wilson
                                          President and Chief Executive Officer



Dated: August 7, 2009

                                  By: /s/ WILLIAM D. THOMAS
                                      __________________________________________
                                          William D. Thomas
                                          Chief Financial Officer













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