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

                                    FORM 10-Q
(Mark One)

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 For the quarterly period ended: March 31, 2008

[   ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _____________________ to ________________

                        Commission file number 000-50619

                             MOMENTUM BIOFUELS, INC.
                             -----------------------
                       (Name of registrant in its Charter)

         COLORADO                                 84-1069035
         --------                                 ----------

 (STATE OR OTHER JURISDICTION                    (I.R.S. EMPLOYER
 OF INCORPORATION OR ORGANIZATION)              IDENTIFICATION NUMBER)


             2600 South Shore Blvd, Suite 100 League City, TX 77573
             ------------------------------------------------------
                     (Address of Principal Executive Offices)


                                 (281) 334-5161
                                 --------------
                        (Telephone # including Area Code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the past 12 months (or for such shorter  period that the registrant was required
to file such reports),  and (2) has been subject to the filing  requirements for
the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the  registrant is a large  accelerated  file, an
accelerated filer, a non-accelerated  filer, or a smaller reporting company. See
the definitions of "large accelerated  filer,"  "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated  filer [ ] (Do
not check if a smaller reporting company) Smaller reporting company [X]

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


Indicate  the number of share  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

As of May 14, 2008, there were 47,528,756  shares of the registrant's sole class
of common shares outstanding.


<PAGE>
<TABLE>
<CAPTION>
<S>                                                                                              <C>





PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements       (Unaudited)                                                  Page
                                                                                                 ----

         Unaudited Consolidated Balance Sheets - March 31, 2008 and
         December 31, 2007                                                                       F-1

         Unaudited  Consolidated Statements of Operations  - Three months ended
         March 31, 2008 and 2007 and                                                             F-2

         Unaudited Consolidated Statements of Changes in Shareholders' Deficit -
         March 31, 2008                                                                          F-3

         Unaudited Consolidated Statements of Cash Flows - Three months ended
         March 31, 2008 and 2007 and                                                             F-5

         Notes to the Unaudited Consolidated Financial Statements                                F-7

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations                                                                             1

Item 3.  Quantitative and Qualitative Disclosures About Market Risk -
         Not Applicable

Item 4.  Controls and Procedures                                                                   3

Item 4T. Controls and Procedures                                                                   3

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings                                                                         4

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds                               4

Item 3.  Defaults Upon Senior Securities - Not Applicable                                          4

Item 4.  Submission of Matters to a Vote of Security Holders - Not Applicable                      5

Item 5.  Other Information - Not Applicable                                                        5

Item 6.  Exhibits                                                                                  5

SIGNATURES

</TABLE>


<PAGE>




PART I -- FINANCIAL INFORMATION

Item 1. Financial Statements.

For financial  information,  please see the financial  statements  and the notes
thereto, attached hereto and incorporated herein by this reference.

The financial  statements have been prepared by Momentum Biofuels,  Inc. without
audit  pursuant to the rules and  regulations  of the  Securities  and  Exchange
Commission.  Certain information and footnote  disclosures  normally included in
financial  statements  prepared in accordance with generally accepted accounting
principles  have  been  condensed  or  omitted  as  allowed  by such  rules  and
regulations,  and management  believes that the disclosures are adequate to make
the information presented not misleading. These financial statements include all
of the adjustments which, in the opinion of management,  are necessary to a fair
presentation  of  financial  position  and  results  of  operations.   All  such
adjustments are of a normal and recurring  nature.  These  financial  statements
should be read in conjunction with the audited financial  statements at December
31, 2007, included in the Company's Form 10-KSB.

<PAGE>
<TABLE>
<CAPTION>

                     MOMENTUM BIOFUELS, INC. AND SUBSIDIARY
                      (formerly Tonga Capital Corporation)
                          Consolidated Balance Sheets
                                  (Unaudited)

<S>                                                                     <C>                    <C>


                                                                          March 31, 2008        December 31, 2007
                                                                        --------------------   --------------------
 ASSETS
Current Assets
Cash                                                                            $    98,098            $   777,171
Accounts Receivable, net                                                             21,629                  3,859
Inventory                                                                            19,136                 56,759
Prepaid insurance                                                                    28,468                 33,766
                                                                        --------------------   --------------------
Total current assets                                                                167,331                871,555

Property & equipment, net of accumulated depreciation and amortization            3,122,566              3,253,410
Security deposits                                                                    26,278                 26,278
                                                                        --------------------   --------------------
TOTAL ASSETS                                                                    $ 3,316,175            $ 4,151,243
                                                                        ====================   ====================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable                                                                $   371,247            $   194,226
Accrued expenses                                                                    183,225                191,942
Advances - related parties                                                           10,000                      -
Notes payable - related parties                                                           -                315,891
                                                                        --------------------   --------------------
Total Current Liabilities                                                           564,472                702,059
                                                                        --------------------   --------------------
Stockholders' Equity
Common stock, $0.01 par value;  500,000,000  shares  authorized,
47,528,756 and 54,828,475,287 shares  issued and outstanding
on March 31, 2008 and  December  31, 2007, respectively                             475,287                548,287
Additional paid-in capital                                                       12,341,407             11,853,153
Accumulated Deficit                                                             (10,064,991)            (8,952,256)
                                                                        --------------------   --------------------
Total Stockholders' Equity                                                        2,751,703              3,449,184
                                                                        --------------------   --------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                      $ 3,316,175            $ 4,151,243
                                                                        ====================   ====================
  See the accompanying notes to the consolidated financial statements.

                                      F-1

</TABLE>





<PAGE>
<TABLE>
<CAPTION>

                     MOMENTUM BIOFUELS, INC. AND SUBSIDIARY
                      (formerly Tonga Capital Corporation)
                     Consolidated Statements of Operations
                For the Three Months Ended March 31, 2008 & 2007
                                  (Unaudited)
<S>                                                                         <C>                     <C>


                                                                                   2008                    2007
                                                                            --------------------    --------------------
Revenue                                                                            $    348,930              $        -
Cost of goods sold                                                                      251,623                       -
                                                                            --------------------    --------------------
Gross profit                                                                             97,307                       -


Operating Expenses
Plant expenses                                                                          430,349                  51,319
General and administrative                                                              778,465                 365,300
                                                                            --------------------    --------------------
Total Operating Expenses                                                              1,208,814                 416,619
                                                                            --------------------    --------------------
Loss from operations                                                                 (1,111,507)               (416,619)
                                                                            --------------------    --------------------
Other Income (Expense)
Interest income                                                                           1,082                   1,189
Interest expense                                                                         (2,310)                 (7,917)
                                                                            --------------------    --------------------
Total Other Income (Expense)                                                             (1,228)                 (6,728)
                                                                            --------------------    --------------------
Net Loss                                                                           $ (1,112,735)             $ (423,347)
                                                                            ====================    ====================
Per Share Information:
Weighted average number of common shares outstanding - Basic and diluted             50,832,381              49,866,963
                                                                            ====================    ====================
Net Loss per Share                                                                 $      (0.02)             $    (0.01)
                                                                            ====================    ====================



See the accompanying notes to the consolidated financial statements.

                                      F-2

</TABLE>


<PAGE>
<TABLE>
<CAPTION>

                     MOMENTUM BIOFUELS, INC. AND SUBSIDIARY
                      (formerly Tonga Capital Corporation)
                 Consolidated Statement of Stockholders' Equity
           For the Period from January 1, 2008 through March 31, 2008
                                       (Unaudited)
<S>                                  <C>               <C>              <C>                <C>                  <C>


                                                                          Additional
                                      Common Stock                         Paid-In             Accumulated
                                      Shares            Amount             Capital              Deficit              Totals
                                     ----------------  ---------------  -----------------  ------------------   ---------------
Balance - December 31, 2007               54,828,756        $ 548,287        $11,853,153        $ (8,952,256)      $ 3,449,184
Cancelled shares                          (7,500,000)         (75,000)            75,000               -                    -
Shares issued in private
 placement for cash                          200,000            2,000             78,000               -                80,000
Share based compensation                          -                -             335,254               -               335,254
Net loss                                                                                          (1,112,735)       (1,112,735)
                                     ------------------------------------------------------------------------------------------
Balance - March 31, 2008                  47,528,756        $ 475,287        $12,341,407       $ (10,064,991)      $ 2,751,703
                                     ==========================================================================================

See the accompanying notes to the consolidated financial statements.

                                      F-3

</TABLE>


<PAGE>
<TABLE>
<CAPTION>

                     MOMENTUM BIOFUELS, INC. AND SUBSIDIARY
                      (formerly Tonga Capital Corporation)
                     Consolidated Statements of Cash Flows
                For the Three Months Ended March 31, 2008 & 2007
                                  (Unaudited)
<S>                                                                      <C>                    <C>


                                                                                2008                   2007
                                                                         --------------------   --------------------
Cash Flows from Operating Activities
Net loss                                                                        $ (1,112,735)            $ (423,347)
Adjustments to reconcile net loss to cash used in operating activities
Depreciation                                                                         130,843                  6,352
Share based compensation                                                             335,254
Changes in Assets and Liabilities
Accounts receivable                                                                  (17,770)                     -
Inventory                                                                             37,623                      -
Prepaid expenses and other current assets                                              5,298                 (8,042)
Accounts payable                                                                     177,021               (141,845)
Accrued expenses                                                                      (8,716)                98,172
                                                                         --------------------   --------------------
Net Cash Used in Operating Activities                                               (453,182)              (468,710)

Cash Flows used in Investing Activities
Acquisition of fixed assets                                                                -               (614,544)
                                                                         --------------------   --------------------
Net Cash Used in Investing Activities                                                      -               (614,544)

Cash Flows from Financing Activities
Payment of note payable                                                             (315,891)              (165,000)
Loans from shareholders                                                               10,000                115,000
Stock issued for cash                                                                 80,000                850,000
Offering costs                                                                             -                 (8,680)
Subscriptions payable                                                                      -                380,000
                                                                         --------------------   --------------------
Net Cash Provided (Used) by Financing Activities                                    (225,891)             1,171,320
                                                                         --------------------   --------------------
Net Increase (Decrease) in Cash                                                     (679,073)                88,066

Cash and cash equivalents - Beginning of period                                      777,171                 19,477
                                                                         --------------------   --------------------
Cash and cash equivalents - End of period                                       $     98,098             $  107,543
                                                                         ====================   ====================

Supplemental Disclosure of Cash Flow Information:
Cash Paid During the period for:
Interest                                                                        $      2,310             $   13,441
                                                                         ===========================================
Income Taxes                                                                    $          -             $        -
                                                                         ===========================================
Non-Cash Transactions - Investing activities:
Capitalized interest during construction period                                 $          -             $  165,281
                                                                         ===========================================
Financing activities
Cancellation of common shares                                                   $     75,000             $        -
                                                                         ===========================================

Notes payable issued for recapitalization                                       $          -             $  400,000
                                                                         ===========================================

 See the accompanying notes to the consolidated financial statements.

                                      F-4

</TABLE>


<PAGE>




                     MOMENTUM BIOFUELS, INC. AND SUBSIDIARY
                      (formerly Tonga Capital Corporation)
                 Notes to the Consolidated Financial Statements
                              As of March 31, 2008
                                   (Unaudited)

Note 1 - Organization and Nature of Operations

Tonga Capital Corporation was incorporated on January 29, 1987 in and has been a
non-operating  entity  classified  as a shell  company  under  Rule 12b-2 of the
Securities  Exchange Act of 1934.  Momentum  Biofuels,  Inc. was incorporated in
Texas on May 8, 2006 to begin biodiesel fuel  production.  On May 31, 2006 Tonga
signed an Agreement and Plan of Reorganization with Momentum Biofuels,  Inc. The
shareholders of Momentum  Biofuels,  Inc.  received  39,275,000 shares of common
stock of Tonga in exchange for 39,275,000 shares of Momentum Biofuels, Inc. This
transaction was accounted for as a reverse merger with Momentum  Biofuels,  Inc.
being treated as the accounting acquirer.

On October 10, 2007, at the Annual  Shareholders'  Meeting,  the majority of the
shareholders  approved a resolution to change Tonga's name to Momentum Biofuels,
Inc. (Momentum).

Our business purpose is to manufacture  high quality  biodiesel fuel for sale to
local distributors, jobbers, and state and local government fleets.

In the opinion of management,  all adjustments  (consisting of normal  recurring
accruals)  considered  necessary  for  a  fair  presentation  of  the  financial
position, results of operations and cash flows for the interim periods presented
have been  included.  The  results of  operations  for  interim  periods are not
necessarily indicative of the results that may be expected for any other interim
period or for the full year.

Note 2--Summary Of Significant Accounting Policies

Principles of Consolidation

The  accompanying  consolidated  financial  statements  include the  accounts of
Momentum and its wholly- owned subsidiary. All significant intercompany accounts
and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure  of contingent  assets and  liabilities  and the reported  amounts of
revenues and expenses during the reporting  period.  Our  significant  estimates
primarily relate to the assessment of warrants and debt and equity  transactions
and the estimated  lives and methods used in determining  depreciation  of fixed
assets. Actual results could differ from those estimates.

                                      F-5

<PAGE>





Recent Accounting Pronouncements

Momentum   does  not  expect  that  adoption  of  recently   issued   accounting
pronouncements will have a material impact on its financial position, results of
operations or cash flows.

Note 3 - Going Concern

In  Momentum's  Annual  Report  on Form  10-KSB  for  2007,  the  Report  of the
Independent  Registered Public Accounting Firm includes an explanatory paragraph
that describes  substantial  doubt about the Company's  ability to continue as a
going concern.  Momentum's financial statements for the three months ended March
31, 2008 have been prepared on a going concern  basis,  which  contemplates  the
realization of assets and the  satisfaction  of liabilities in the normal course
of business. The Company had an accumulated deficit of $10,064, 991 at March 31,
2008.

Momentum's  ability to continue as a going concern is dependent upon its ability
to develop  additional  sources of capital and,  ultimately,  achieve profitable
operations.  The accompanying  consolidated  financial statements do not include
any adjustments that might result from the outcome of these uncertainties.

Note 4 - Concentration of Credit Risk

During  the  first  quarter  of  2008,  three  customers  accounted  for 100% of
Momentum's  revenue.   Momentum  performs  ongoing  credit  evaluations  of  its
customers' financial condition. Momentum's accounts receivable are unsecured. At
March 31, 2008, two customers accounted for 100% of accounts receivable.

Note 5 - Inventories

Inventory as of March 31, 2008 and December 31, 2007 consisted of the following:

                       Description               2008                      2007
                                                 ----                      ----

                     Finished Goods             $14,235                $ 20,662
                         Work-In-Process             -0-                     -0-
                         Raw Materials            4,803                  36,097
                                               ---------                --------

                         Total                  $19,038                $ 56,759
                                               =========                ========



                                      F-6

<PAGE>


Note 6 - Property and Equipment

Property,  plant  and  equipment  as of March 31,  2008 and  December  31,  2007
consisted of the following:

                         Description              2008                     2007
                                                  ----                     ----

Plant                                    $   3,414,592            $   3,414,592
Plant machinery and equipment                   29,810                   29,810
Office furniture and equipment                  52,238                   52,238
Computer software                                3,220                    3,220
Leasehold Improvements                          33,624                   33,624
                                   ---------------------      ------------------
      Total Assets                       $   3,533,484            $   3,533,484
                                   ---------------------      ------------------
Accumulated Depreciation &
Amortization                                  (410,918)                (280,074)
                                   ---------------------      ------------------
                                         $   3,122,566            $   3,253,410
                                   =====================      ==================

Depreciation expense for the three months ending March 31, 2008 was $130,844.

Note 7 - Notes Payable to Related Parties

Notes  payable as of March 31,  2008 and  December  31,  2007  consisted  of the
following:
<TABLE>
<CAPTION>
<S>                                                                             <C>                   <C>

                             Description                                            2008                     2007
- ------------------------------------------------------------------------      -----------------     ------------------

Non-interest bearing note payable to Ultimate Investments Corporation, a company
wholly-owned by a shareholder. The note was paid in full in January, 2008.
                                                                                 $      -                  $315,891
                                                                                -----------------     ------------------
  Total                                                                          $      -                  $315,891
                                                                                =================     ==================
</TABLE>

Note 8 - Advances from Related Parties

Non-interest  bearing  advance from Jeff Ploen,  who  beneficially  owns J. Paul
Consulting Corporation. The advance is due upon demand with no maturity date.

                                      F-7

<PAGE>




Note 9 - Equity Financing

During the three months ended March 31, 2008,  Momentum issued 200,000 shares of
its restricted common stock for cash of $80,000. The shares were sold at a price
of $0.40 per share.

On February  12, 2008,  the Board of  Directors of Momentum  voted to cancel the
shares of the common  stock held by the Momentum  Employees & Consultant  Trust.
The Momentum  Employees & Consultant  Trust held 7,500,000  shares of restricted
common  stock.  The shares were  previously  controlled by Charles  Phillips,  a
shareholder and former director of Momentum,  and the shares were cancelled with
his consent.

Note 10 - Options

Options were originally issued in conjunction with employment agreements for key
employees and consultants.

Option activity for the three months ended March 31, 2008 is as follows:
<TABLE>
<CAPTION>
<S>                   <C>               <C>            <C>             <C>              <C>              <C>

                       Expiration        Exercise
Grant Date             Date               Price            Beginning       Granted          Forfeited           Ending
- ------------------- ----------------- -------------- --------------- ---------------- ---------------- --------------
  04/20/07            04/20/12            $1.00          2,250,000                                           2,250,000
  10/15/07            10/15/10            $1.00             50,000                                (50,000)           -
  10/16/07            10/16/12            $1.00          7,000,000                             (1,000,000)   6,000,000
  11/01/07            11/01/12            $1.00          1,000,000                                           1,000,000
                                                       --------------- ---------------- ---------------- --------------
                                                        10,300,000                             (1,050,000)   9,250,000
                                                       =============== ================ ================ ==============
</TABLE>

The weighted average exercise price for all options  outstanding as of March 31,
2008 was $1.

Note 11 - Warrant Activity


Warrants activity for the three months ended March 31, 2008 is as follows:
<TABLE>
<CAPTION>
<S>                <C>               <C>            <C>                <C>             <C>             <C>

                         Expiration        Exercise
Grant Date               Date             Price         Beginning       Granted         Exercised             Ending
------------------ ----------------- -------------- ------------------ --------------- --------------- ------------------
  6/27/2006           6/27/2016          $1.00         100,000 (1)                                                 100,000
 11/30/2006          11/30/2016          $1.00          10,000 (2)                                                  10,000
 12/31/2006          12/31/2016          $1.00          10,000 (2)                                                  10,000
  1/31/2007           1/31/2017          $1.00          10,000 (3)                                                  10,000
   2/1/2007            2/1/2012          $1.00           2,000 (3)                                                   2,000
  8/31/2007           8/31/2009          $1.00       1,000,000 (4)                                               1,000,000
  10/4/2007           10/4/2009          $1.00         150,000 (5)                                                 150,000
                                                    ------------------ --------------- --------------- ------------------
                                                 $   1,282,000               -                               $   1,282,000
                                                    ================== =============== =============== ==================

</TABLE>

                                      F-8

<PAGE>

The weighted average exercise price for all warrants outstanding as of March 31,
2008 was $1.

     (1)   Momentum calculated the relative fair value of these warrants at
           $162,822 using the Black-Scholes option pricing model and allocated a
           portion of the original proceeds to these warrants as a discount to
           the note through additional paid-in capital.  The assumptions used to
           value the warrants included an expected term of 10 years, a risk-free
           interest rate of 4.98%, expected volatility using comparable company
           volatility of 145%, an exercise price of $1 and a stock price on the
           date of grant of $1.65.

     (2)   Momentum calculated the fair value of these warrants at $33,558 using
           the Black-Scholes option pricing model and this amount has been
           charged to general and administrative expenses and credited to
           additional paid-in capital  for the period from  inception  (May 8,
           2006) through  December 31, 2006. The  assumptions  used to value the
           warrants  include an expected term of 10 years,  a risk free interest
           rate  of  4.98%,   expected   volatility  using  comparable   company
           volatility  of 145%,  an  exercise  price of $1 and an average  stock
           price on the date of grant of $1.65.

     (3)   Momentum calculated the fair value of these warrants at $18,895 using
           the  Black-Scholes  option  pricing  model and this  amount  has been
           charged  to general  and  administrative  expenses  and  credited  to
           additional paid-in capital for the year ending December 31, 2007. The
           assumptions used to value the warrants include an expected term of 10
           years, a risk free interest rate of 4.98%,  expected volatility using
           comparable  company volatility of 145%, an exercise price of $1 and a
           stock price on the date of grant of $1.60.

     (4)   Momentum  calculated  the fair value of these  warrants  at  $547,579
           using the Black-Scholes option pricing model and this amount has been
           charged  to general  and  administrative  expenses  and  credited  to
           additional paid-in capital for the year ending December 31, 2007. The
           assumptions  used to value the warrants include an expected term of 2
           years, a risk free interest rate of 6.50%,  expected volatility using
           comparable  company volatility of 154%, an exercise price of $1 and a
           stock price on the date of grant of $0.95.

     (5)   Momentum calculated the fair value of these warrants at $95,746 using
           the  Black-Scholes  option  pricing  model and this  amount  has been
           charged  to general  and  administrative  expenses  and  credited  to
           additional paid-in capital for the year ending December 31, 2007. The
           assumptions  used to value the warrants include an expected term of 2
           years, a risk free interest rate of 4.17%,  expected volatility using
           comparable  company volatility of 186%, an exercise price of $1 and a
           stock price on the date of grant of $0.80.


                                      F-9

<PAGE>



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

FORWARD-LOOKING STATEMENTS CAUTIONARY

This Item 2 and the report on Form 10-Q for the period  ended March 31, 2008 may
contain  "forward-looking  statements"  regarding Momentum  Biofuels,  Inc. (the
"Company"  or  "Momentum").  In some  cases,  you can  identify  forward-looking
statements by terminology such as "may," "will," "should,"  "could,"  "expects,"
"plans,"  "intends,"   "anticipates,"   "believes,"   "estimates,"   "predicts,"
"potential"  or  "continue"  or the negative of such terms and other  comparable
terminology.  These  forward-looking  statements  include,  without  limitation,
statements about our market opportunity, our strategies,  competition,  expected
activities and  expenditures as we pursue our business plan, and the adequacy of
our  available  cash  resources.  Although  we  believe  that  the  expectations
reflected in any forward-looking  statements are reasonable, we cannot guarantee
future results, levels of activity, performance or achievements.  Actual results
may differ  materially from the predictions  discussed in these  forward-looking
statements.  Changes in the  circumstances  upon  which we base our  predictions
and/or  forward-looking  statements could materially  affect our actual results.
Additional factors that could materially affect these forward-looking statements
and/or  predictions  include,  among other  things:  (1) our  limited  operating
history; (2) our ability to pay down existing debt; (3) the Company's ability to
obtain  contracts with suppliers of raw materials (for the Company's  production
of biodiesel fuel) and distributors of the Company's biodiesel fuel product; (4)
the risks inherent in the mutual  performance  of such supplier and  distributor
contracts  (including  the Company's  production  performance  (5) the Company's
ability to secure and retain  management  capable of  managing  growth;  (6) the
Company's ability to raise necessary financing to execute the Company's business
plan; (7) potential litigation with our shareholders, creditors and/or former or
current  investors;  (8) the  Company's  ability to comply  with all  applicable
federal, state and local government and international rules and regulations; and
(9) other factors over which we have little or no control.

The  independent  registered  public  accounting  firm's report on the Company's
financial  statements  as of  December  31,  2007,  includes  a "going  concern"
explanatory  paragraph  that  describes  substantial  doubt about the  Company's
ability to  continue  as a going  concern.  Management's  plans in regard to the
factors prompting the explanatory paragraph are discussed below and also in Note
2 to the unaudited quarterly financial statements.

PLAN OF OPERATIONS

Momentum is a "pure play" biodiesel  producer focused on servicing the U.S. Gulf
Coast and in the future,  international  biodiesel  markets.  Momentum  plans to
manufacture high quality, low cost and socially responsible biodiesel fuels that
complement and integrate with the existing  diesel fuel supply chain.  Biodiesel
is a domestic,  renewable  fuel for use in diesel  engines  that is derived from
natural vegetable oils and animal fats. Biodiesel contains no petroleum, but can
be used in any concentration with petroleum-based diesel fuel in existing diesel
engines without engine modification.

Our initial  plant in LaPorte,  Texas,  has been  completed  and is currently in
limited production. The Company's initial focus will be on efficiently operating
the La Porte  plant at its planned  capacity  and on sales of our  product.  Our
marketing  strategy  will  focus  on  wholesale  distribution  to fuel  jobbers,
corporate fleets and government users. We will also use established  alternative
fuel brokers where appropriate.

                                       1

<PAGE>





RESULTS OF OPERATIONS

Results of Operations  For The Three Months Ended March 31, 2008 Compared To The
Three Months Ended March 31, 2007

The Company recognized revenue of $348,930 for the three months ending March 31,
2008 compared to no revenues  during the three months ended March 31, 2007.  The
Company's  revenues  were  from its  activities  in  processing  and sale of its
biodiesel  product.  During the three months  ended March 31, 2008,  the Company
incurred cost of goods sold of $251,623, resulting in a gross profit of $97,307.

During the three  months  ended  March 31,  2008,  the  Company  incurred  total
expenses of $1,208,814  compared to $416,619 during the three months ended March
31, 2007.  The increase of $792,195 is a result of the  increased  operations of
the Company over the prior period.  Total expenses during the three months ended
March 31, 2008 included,  $430,349 in plant expenses and $778,465 in general and
administrative  expenses.  General and administrative  expenses during the three
months ended March 31, 2008 included $335,254 of stock compensation  expense for
stock options awarded to executives and key consultants.

During the three months ended March 31, 2008, the Company  recognized a net loss
of  $1,112,735  compared with a net loss of $423,347 for the three months ending
March 31, 2007. The increase of $689,388 was due primarily to increased expenses
related to plant  operations  and the  increase  in general  and  administrative
expenses,  as discussed above. The net loss per share for the three months ended
March 31,  2008,  was $0.02 per share  compared to a net loss per share of $0.01
for the three months ending March 31, 2007.

LIQUIDITY AND CAPITAL RESOURCES

At March 31,  2008,  the  Company had  $98,098 in cash and  $3,218,077  in other
assets with which to conduct its operations.  There can be no assurance that the
Company  will be able to carry out its  business  plan.  Historically,  our cash
needs have been satisfied  primarily through proceeds from private placements of
our equity  securities and debt  instruments,  but we cannot guarantee that such
financing  activities will be sufficient to fund our current and future projects
and our ability to meet our cash and working  capital  needs.  No commitments to
provide  additional  funds have been made by management  or other  stockholders.
Irrespective of whether the Company's cash assets prove to be inadequate to meet
the Company's  operational needs, the Company might seek to compensate providers
of services by issuances of its common stock in lieu of cash.

Net cash used in  operating  activities  during the three months ended March 31,
2008 was  $453,182.  During the three months  ended March 31, 2007,  the Company
used net cash of $468,710 in operating activities. During the three months ended
March 31, 2008,  net losses of $1,112,735  were adjusted for non-cash items that
included $130,843 in depreciation and amortization expense and $335,254 in share
based compensation.  During the three months ended March 31, 2007, net losses of
$423,347  were  adjusted for the  non-cash  item of $6,352 in  depreciation  and
amortization expense.

During the three months ended March 31, 2008,  the Company did not recognize any
cash from its  investing  activities.  During the three  months  ended March 31,
2007, the Company used $614,544 from its investing activities.

                                       2

<PAGE>





Net cash used by  financing  activities  during the three months ended March 31,
2008 was  $225,891.  During the three months  ended March 31, 2007,  the Company
received funds of $1,171,320 from its financing activities.

On March 7, 2008,  Momentum initiated a private placement of 8,000,000 shares of
common  stock at a price of $0.40 per share  During the three months ended March
31, 2008,  the Company sold 200,000  shares of its  restricted  common stock for
cash of $80,000. The shares were sold for $0.40 per share.

On January 11, 2008, the Company made final payment on the outstanding  $400,000
promissory note held by Ultimate  Investment Corp  ("Ultimate").  The promissory
note had an issue date of June 30, 2006 and had been accruing interest at a rate
of 12% per annum,  at the default rate.  The final  payment was $319,792,  cash,
including accrued interest of $3,901.

Management will need to seek and obtain additional funding, via loans or private
placements  of stock,  for future  operations  and to provide  required  working
capital.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The  preparation of financial  statements  included in this Quarterly  Report on
Form 10-Q requires  management to make estimates and assumptions that affect the
reported  amounts  of  assets  and  liabilities  at the  date  of the  financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. On an on-going basis,  management  evaluates its estimates and
judgments.   Management   bases  its   estimates  and  judgments  on  historical
experiences  and on various  other  factors that are  believed to be  reasonable
under  the  circumstances,  the  results  of which  form the  basis  for  making
judgments  about the  carrying  value of  assets  and  liabilities  that are not
readily  apparent  from other  sources.  Actual  results  may differ  from these
estimates  under  different  assumptions  or  conditions.  The more  significant
accounting  estimates  inherent in the  preparation  of the Company's  financial
statements  include estimates as to the valuation of equity related  instruments
issued,  and valuation  allowance for deferred income tax assets. Our accounting
policies are  described in the notes to  financial  statements  included in this
Quarterly  Report on Form 10-Q.  The more  critical  accounting  policies are as
described below.

The  Company  believes  that the  following  are  some of the  more  significant
accounting policies and methods used by the Company:
        revenue recognition;
        value of long-lived assets;
        inventories; and
        income taxes.


REVENUE RECOGNITION

The Company will  recognize  revenue when the product has been  delivered to the
customer,  the  sales  price is fixed or  determinable,  and  collectability  is
reasonably assured.

                                       3

<PAGE>




INVENTORIES

Inventories  are stated at the lower of average  cost basis or market.  Abnormal
amounts of idle facility expenses, freight, handling costs, and wasted materials
are recognized as current period charges. Fixed production overhead is allocated
to the costs of conversion into inventories  based on the normal capacity of the
production facility.

VALUATION OF LONG-LIVED ASSETS

The Company  assesses the  impairment of long-lived  assets  whenever  events or
changes  in   circumstances   indicate  that  the  carrying  value  may  not  be
recoverable.  Factors the Company  considers  important  which could  trigger an
impairment  review  include  negative  projected  operating  performance  by the
Company and significant  negative industry or economic trends.  The Company does
not believe that there has been any impairment to long-lived  assets as of March
31, 2008.

INCOME TAXES

Momentum and its  subsidiary  file a consolidated  federal tax return.  Momentum
uses the asset and liability method in accounting for income taxes. Deferred tax
assets and  liabilities  are  recognized for temporary  differences  between the
financial   statement   carrying  amounts  and  the  tax  bases  of  assets  and
liabilities,  and are measured using the tax rates expected to be in effect when
the differences  reverse.  Deferred tax assets are also recognized for operating
loss and tax  credit  carryforwards.  The  effect on  deferred  tax  assets  and
liabilities  of a change in tax rates is recognized in the results of operations
in the period that includes the enactment date. A valuation allowance is used to
reduce deferred tax assets when uncertainty exists regarding their realization

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

The Company has  reviewed  recently  issued  accounting  pronouncements  and the
Company  does not  expect  that  the  adoption  of  recently  issued  accounting
pronouncements will have a material impact on its financial position, results of
operations or cash flows.

ITEM  3.  QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK - NOT
APPLICABLE

ITEM 4  CONTROLS AND PROCEDURES

Disclosures Controls and Procedures

Under the supervision and with the  participation  of our management,  including
our principal executive officer and principal financial officer, we conducted an
evaluation of our disclosure  controls and  procedures,  as such term is defined
under Rule 13a-15(e)  promulgated under the Securities  Exchange Act of 1934, as
amended  (the  Exchange  Act).  As a result of this  evaluation,  we  identified
material  weaknesses  in our  internal  control over  financial  reporting as of
December 31, 2007.  Accordingly,  we concluded that our disclosure  controls and
procedures were not effective as of December 31, 2007.

                                       4

<PAGE>





As required by SEC Rule 15d-15(b),  our Chief  Executive  Officer carried out an
evaluation  under the supervision and with the  participation of our management,
of the effectiveness of the design and operation of our disclosure  controls and
procedures  pursuant  to  Exchange  Act Rule  15d-14 as of the end of the period
covered by this report. Based on the foregoing  evaluation,  our Chief Executive
Officer has  concluded  that our  disclosure  controls  and  procedures  are not
effective  in  timely  alerting  them to  material  information  required  to be
included in our periodic SEC filings and to ensure that information  required to
be disclosed in our periodic SEC filings is accumulated and  communicated to our
management,  including our Chief Executive  Officer,  to allow timely  decisions
regarding  required  disclosure  as a result of the  deficiency  in our internal
control over financial reporting discussed below.

The material  weakness  identified  in our annual  report on Form 10-KSB for the
year  ended  December  31,  2007 was  related to a lack of an  accounting  staff
resulting in a lack of segregation of duties and accounting  technical expertise
necessary for an effective system of internal control.


ITEM 4T. CONTROLS AND PROCEDURES

Management's Quarterly Report on Internal Control over Financial Reporting.

Management's  assessment  of  the  effectiveness  of the  registrant's  internal
control  over  financial  reporting  is as of the quarter  ended March 31, 2008.
Based on the evaluation,  management concluded that there is a material weakness
in our internal control over financial reporting.  The material weakness relates
to the  monitoring  and  review  of  work  performed  by  contracted  accounting
personnel in the  preparation of audit and financial  statements,  footnotes and
financial  data  provided to Momentum's  registered  public  accounting  firm in
connection  with the annual  audit.  Until  October  2007,  all of our financial
reporting was carried out by our Chief Financial Officer, and we did not have an
audit committee  established  until October 12, 2007. This lack of an accounting
staff  results  in a lack of  segregation  of duties  and  accounting  technical
expertise necessary for an effective system of internal control.

A  material  weakness  is  a  control  deficiency,  or  combination  of  control
deficiencies,  in ICFR  such  that  there  is a  reasonable  possibility  that a
material  misstatement of our annual or interim financial statements will not be
prevented or detected on a timely  basis by  employees  in the normal  course of
their assigned functions.

Notwithstanding  this  material  weakness,  we  believe  that  the  consolidated
financial  statements  included in this report fairly  present,  in all material
respects,  our consolidated  financial  position and results of operations as of
and for the quarter ended March 31, 2008.

                                       5

<PAGE>




Remediation of Material Weakness

As discussed in  Management's  Annual Report on Internal  Control over Financial
Reporting,  as of December  31,  2007,  there were  material  weaknesses  in our
internal  control over financial  reporting.  We are in the process of analyzing
our processes for all business units and the  establishment  of formal  policies
and  procedures  with  necessary  segregation  of duties,  which will  establish
mitigating  controls to compensate  for the risk due to lack of  segregation  of
duties.  In  addition,  we are  evaluating  the  necessary  steps to improve our
controls over  financial  reporting and we are in the initial  planning phase of
upgrading,  where  possible,  certain  of  our  information  technology  systems
impacting financial reporting.

Through these steps, we believe we are addressing the deficiencies that affected
our internal control over financial  reporting as of December 31, 2007 and March
31,  2008.  However,  the  effectiveness  of any system of internal  controls is
subject to inherent  limitations and there can be no assurance that our internal
control over financial reporting will prevent or detect all errors.  Because the
remedial actions require hiring of additional  personnel,  upgrading  certain of
our information technology systems, and relying extensively on manual review and
approval,  the  successful  operation  of these  controls  for at least  several
quarters  may be required  before  management  may be able to conclude  that the
material weakness has been remediated.

The aggregate costs of remediation are unknown at this time.

Changes in Internal Control Over Financial Reporting.

There  was no change in our  internal  control  over  financial  reporting  that
occurred  during the fiscal  quarter ended March 31, 2008,  that has  materially
affected,  or is reasonably  likely to materially  affect,  our internal control
over financial reporting.

PART II--OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

In February 2008, Momentum received notice of its inclusion in a legal complaint
filed  against  Vertex  Energy by Purity  Water  Company  of San  Antonio in the
Circuit  Court of Mobile,  Alabama.  The  complaint  alleges  that  Vertex,  the
defendant, contracted with Purity Water, the plaintiff, to remove water from two
million gallons of Biodiesel  stored in Alabama.  The complaint  further alleges
that Vertex engaged several other companies,  including Momentum Biofuels, Inc.,
as subcontractors to service the contract.

Momentum  submitted an affidavit to the court on April 25, 2008,  attesting that
the Company had no contractual agreement with either the plaintiff or any of the
other parties named in the complaint. Momentum has since been dismissed from the
suit without prejudice by the presiding District Court in Mobile, Alabama.

                                       6

<PAGE>




ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The Company made the following unregistered sales of its securities from January
1, 2008 through March 31, 2008.
<TABLE>
<CAPTION>
<S>            <C>                <C>              <C>                       <C>

               TITLE OF           NO. OF SHARES
DATE OF SALE   SECURITIES                          CONSIDERATION             CLASS OF PURCHASER
------------------------------------------------------------------------------------------------------

03/27/08       Common Stock       80,000           $0.40 per share           Accredited Investor(s) -
                                                                             Private Placement
                                                                             Memorandum

</TABLE>


Exemption From Registration Claimed

All of the sales by the Company of its unregistered  securities were made by the
Company in reliance upon Section 4(2) of the Act. All of the individuals  and/or
entities listed above that purchased the unregistered  securities were all known
to the Company and its management,  through pre-existing business relationships,
as long standing business  associates,  friends,  and employees.  All purchasers
were provided access to all material information,  which they requested, and all
information  necessary to verify such  information  and were afforded  access to
management of the Company in connection with their purchases.  All purchasers of
the unregistered securities acquired such securities for investment and not with
a view  toward  distribution,  acknowledging  such  intent to the  Company.  All
certificates  or  agreements  representing  such  securities  that  were  issued
contained restrictive legends,  prohibiting further transfer of the certificates
or agreements representing such securities, without such securities either being
first registered or otherwise exempt from  registration in any further resale or
disposition.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

         None

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

         None

ITEM 5. OTHER INFORMATION.

         None


<PAGE>




ITEM 6. EXHIBITS.

The  following is a complete  list of exhibits  filed as part of this Form 10-Q.
Exhibit  numbers  correspond  to the numbers in the Exhibit Table of Item 601 of
Regulation S-K.

     31.1 Certification  by the Chief Executive  Officer pursuant to Section 302
          of the Sarbanes-Oxley Act.

     32.1 Certification  by the Chief Executive  Officer pursuant to Section 906
          of the



<PAGE>





                                   SIGNATURES


In accordance with the  requirements of the Securities  Exchange Act of 1934, as
amended,  the  registrant  caused  this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



                                                MOMENTUM BIOFUELS, INC.

Date: May 20, 2008                              By: /s/Gregory A. Enders
                                                    --------------------
                                                Gregory A. Enders, President
                                                And Chief Executive Officer
                                                and Principal Accounting Officer