----

----

| Nevada(State      or other jurisdiction of incorporation or organization) | 91-1918324(I.R.S.      EmployerIdentification      No.) |
|---------------------------------------------------------------------------|---------------------------------------------------------|

|                                |   |                          |   |                              |   |                                       |
|-------------------------------------|--------|-------------------------------|--------|-----------------------------------|--------|--------------------------------------------|
| Large      accelerated filer o |   | Accelerated      filer o |   | Non-accelerated      filer o |   | Smaller      reporting company þ |

----

| Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Page      No. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------|
| FINANCIAL      INFORMATION:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |          |
| Unaudited      Condensed Consolidated Financial Statements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | F-1      |
| Condensed      Consolidated Balance Sheets at September 30, 2008 and December 31,      2007                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | F-1           |
| Condensed      Consolidated Statement of Operations for the Three and Nine Months Ended      September 30, 2008 and 2007 and for the Period From Inception, May 25,      2004 to September 30, 2008                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | F-2      |
| Condensed      Consolidated Statements of Cash Flows for the Nine Months Ended September      30, 2008 and 2007 and for the Period From Inception, May 25, 2004 to      September 30, 2008                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | F-3           |
| Condensed      Consolidated Statement of Shareholders’ Equity/(Deficit)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | F-4      |
| Condensed      Notes to Condensed Consolidated Financial      Statements                                                                                                                                   | F-5           |

----

| MANAS      PETROLEUM CORPORATION                                                                                                                      |   |   |        |   |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|
| (A      DEVELOPMENT STAGE COMPANY)                                                                                                                    |   |   |        |   |   |   |
| CONDENSED      CONSOLIDATED FINANCIAL STATEMENTS                                                                                                      |   |   |        |   |
| UNAUDITED                                                                                                                                             |   |   |        |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |
| CONDENSED      CONSOLIDATED BALANCE SHEETS                                                                                                            |   |   |        |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |
|                                                                                                                                                  |   |   | 09.30.2008  |   |   |   | 12.31.2007 |   |
|                                                                                                                                                  |   | USD    |        |   | USD    |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| ASSETS                                                                                                                                                |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Cash      and cash equivalents                                                                                                                        |   |   | 1,342,063   |   |   |   | 8,480,771 |   |
| Restricted      cash                                                                                                                                  |   |   | 9,115,000   |   |   |   | - |   |
| Accounts      receivable                                                                                                                              |   |   | 186,841     |   |   |   | 148,346 |   |
| Prepaid      expenses                                                                                                                                 |   |   | 206,979     |   |   |   | 125,923 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Total      current assets                                                                                                                             |   |   | 10,850,883  |   |   |   | 8,755,040 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Debt      issuance costs                                                                                                                              |   |   | 298,050     |   |   |   | - |   |
| Tangible      fixed assets                                                                                                                            |   |   | 246,524     |   |   |   | 153,074 |   |
| Investment      in associate                                                                                                                          |   |   | 238,304     |   |   |   | 238,304 |   |
| Other      non-current assets                                                                                                                         |   |   | 62,279      |   |   |   | 62,279 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Total      non-current assets                                                                                                                         |   |   | 845,157     |   |   |   | 453,657 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| TOTAL      ASSETS                                                                                                                                     |   |   | 11,696,040  |   |   |   | 9,208,697 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| LIABILITIES      AND SHAREHOLDERS' EQUITY                                                                                                             |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Bank      overdraft                                                                                                                                   |   |   | -           |   |   |   | 2,305 |   |
| Accounts      payable                                                                                                                                 |   |   | 1,784,726   |   |   |   | 110,156 |   |
| Bank      loan                                                                                                                                        |   |   | 1,220,000   |   |   |   | - |   |
| Accrued      expenses Albania fees                                                                                                                    |   |   | -           |   |   |   | 400,000 |   |
| Accrued      expenses VAT                                                                                                                             |   |   | 365,301     |   |   |   | 264,984 |   |
| Accrued      expenses Professional fees                                                                                                               |   |   | 84,301      |   |   |   | 408,862 |   |
| Accrued      expenses Interest                                                                                                                        |   |   | 98,849      |   |   |   | - |   |
| Accrued      expenses Commissions                                                                                                                     |   |   | 70,000      |   |   |   | - |   |
| Other      accrued expenses                                                                                                                           |   |   | 210,775     |   |   |   | 168,192 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Total      current liabilities                                                                                                                        |   |   | 3,833,952   |   |   |   | 1,354,499 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Loan      owed to a shareholder                                                                                                                       |   |   | -           |   |   |   | 39,329 |   |
| Participation      liabilities                                                                                                                        |   |   | 640,000     |   |   |   | - |   |
| Contingently      convertible loan                                                                                                                    |   |   | 1,698,849   |   |   |   | - |   |
| Debentures                                                                                                                                            |   |   | 3,810,000   |   |   |   | - |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Total      non-current liabilities                                                                                                                    |   |   | 6,148,849   |   |   |   | 39,329 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| TOTAL      LIABILITIES                                                                                                                                |   |   | 9,982,801   |   |   |   | 1,393,828 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Common      stock (300,000,000 shares authorized, USD 0.001 par value, 117,570,122 and      112,156,488 shares, respectively, issued and outstanding) |   |   | 117,570     |   |   |   | 112,156 |   |
| Additional      paid-in capital                                                                                                                       |   |   | 32,735,505  |   |   |   | 21,550,636 |   |
| Deficit      accumulated during the development stage                                                                                                 |   |   | (31,202,436 | )      |   |   | (13,904,456 | ) |
| Accumulated      other comprehensive income                                                                                                           |   |   | 62,600      |   |   |   | 56,533 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| Total      shareholders' equity                                                                                                                       |   |   | 1,713,239   |   |   |   | 7,814,870 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |
| TOTAL      LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                                       |   |   | 11,696,040  |   |   |   | 9,208,697 |   |
|                                                                                                                                                  |   |   |        |   |   |   |   |   |

----

| MANAS      PETROLEUM CORPORATION                           |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |
|------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------|------------------|--------|--------|------------------|--------|--------|---------------------|-------------|--------|
| (A      DEVELOPMENT STAGE COMPANY)                         |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |
| CONDENSED      CONSOLIDATED FINANCIAL STATEMENTS           |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |
| UNAUDITED                                                  |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |
| CONDENSED      CONSOLIDATED STATEMENTS OF OPERATIONS       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |
|                                                       |   |                                For the three months ended |        |   |                                   For the nine months ended |   |        | Period      from |   |   | Period      from |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                | 05.25.2004  |   |   |   | 05.25.2004 |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   | (Inception)      to |        |   | (Inception)      to |   |
|                                                       |   |                                                                                                                                                                                   | 09.30.2008  |   |                                                                                                                                                                                                    |   | 09.30.2007  |             |   |   | 09.30.2008       |   |   |                | 09.30.2007  |   |   |   | 12.31.2007 |   |   |   | 09.30.2008 |   |
|                                                       |   | USD                                                                                                                                                                                    |        |   | USD                                                                                                                                                                                                     |   |        | USD              |   |   | USD              |   |   | USD                 |        |   | USD |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| OPERATING      REVENUES                                    |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Other      revenues                                        |   |                                                                                                                                                                                   | 42,122      |   |                                                                                                                                                                                                    |   | -           |             |   |   | 635,318          |   |   |                | -           |   |   |   | 740,409 |   |   |   | 1,375,728 |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Total      revenues                                        |   |                                                                                                                                                                                   | 42,122      |   |                                                                                                                                                                                                    |   | -           |             |   |   | 635,318          |   |   |                | -           |   |   |   | 740,409 |   |   |   | 1,375,728 |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| OPERATING      EXPENSES                                    |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Personnel      costs                                       |   |                                                                                                                                                                                   | (2,347,406  | )      |                                                                                                                                                                                                    |   | (2,012,860  | )                |   |   | (7,404,306       | )      |   |                | (3,709,079  | )      |   |   | (5,994,135 | ) |   |   | (13,398,441 | ) |
| Exploration      costs                                     |   |                                                                                                                                                                                   | (2,788,817  | )      |                                                                                                                                                                                                    |   | (105,651    | )                |   |   | (4,076,829       | )      |   |                | (151,552    | )      |   |   | (1,374,982 | ) |   |   | (5,451,811 | ) |
| Depreciation                                               |   |                                                                                                                                                                                   | (14,872     | )      |                                                                                                                                                                                                    |   | (4,210      | )                |   |   | (36,709          | )      |   |                | (8,018      | )      |   |   | (46,632 | ) |   |   | (83,342 | ) |
| Consulting      fees                                       |   |                                                                                                                                                                                   | (420,769    | )      |                                                                                                                                                                                                    |   | (492,434    | )                |   |   | (3,617,992       | )      |   |                | (914,635    | )      |   |   | (3,732,079 | ) |   |   | (7,350,070 | ) |
| Administrative      costs                                  |   |                                                                                                                                                                                   | (695,284    | )      |                                                                                                                                                                                                    |   | (714,948    | )                |   |   | (2,137,094       | )      |   |                | (4,104,720  | )      |   |   | (7,492,559 | ) |   |   | (9,629,653 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Total      operating expenses                              |   |                                                                                                                                                                                   | (6,267,148  | )      |                                                                                                                                                                                                    |   | (3,330,103  | )                |   |   | (17,272,929      | )      |   |                | (8,888,004  | )      |   |   | (18,640,386 | ) |   |   | (35,913,316 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Gain      from sale of investment                          |   |                                                                                                                                                                                   | -           |   |                                                                                                                                                                                                    |   | -           |             |   |   | -                |   |   |                | -           |   |   |   | 3,864,197 |   |   |   | 3,864,197 |   |
| Loss      from sale of investment                          |   |                                                                                                                                                                                   | -           |   |                                                                                                                                                                                                    |   | -           |             |   |   | -                |   |   |                | (900        | )      |   |   | (900 | ) |   |   | (900 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| OPERATING      LOSS                                        |   |                                                                                                                                                                                   | (6,225,026  | )      |                                                                                                                                                                                                    |   | (3,330,103  | )                |   |   | (16,637,611      | )      |   |                | (8,888,904  | )      |   |   | (14,036,680 | ) |   |   | (30,674,291 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| NON-OPERATING      INCOME / (EXPENSE)                      |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Exchange      differences                                  |   |                                                                                                                                                                                   | 816         |   |                                                                                                                                                                                                    |   | 8,825       |             |   |   | 60,373           |   |   |                | (18,195     | )      |   |   | (88,943 | ) |   |   | (28,570 | ) |
| Interest      income                                       |   |                                                                                                                                                                                   | 49,702      |   |                                                                                                                                                                                                    |   | 97,622      |             |   |   | 124,053          |   |   |                | 199,259     |   |   |   | 343,350 |   |   |   | 467,404 |   |
| Interest      expense                                      |   |                                                                                                                                                                                   | (207,676    | )      |                                                                                                                                                                                                    |   | (3,950      | )                |   |   | (843,268         | )      |   |                | (8,725      | )      |   |   | (81,640 | ) |   |   | (924,907 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Loss      before taxes and equity in net loss of associate |   |                                                                                                                                                                                   | (6,382,184  | )      |                                                                                                                                                                                                    |   | (3,227,606  | )                |   |   | (17,296,453      | )      |   |                | (8,716,565  | )      |   |   | (13,863,912 | ) |   |   | (31,160,365 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Taxes                                                      |   |                                                                                                                                                                                   | (750        | )      |                                                                                                                                                                                                    |   | (352        | )                |   |   | (1,527           | )      |   |                | (676        | )      |   |   | (1,674 | ) |   |   | (3,201 | ) |
| Equity      in net loss of associate                       |   |                                                                                                                                                                                   | -           |   |                                                                                                                                                                                                    |   | (18,169     | )                |   |   | -                |   |   |                | (38,302     | )      |   |   | (24,523 | ) |   |   | (24,523 | ) |
| Minority      interest in net income                       |   |                                                                                                                                                                                   | -           |   |                                                                                                                                                                                                    |   | -           |             |   |   | -                |   |   |                | -           |   |   |   | (18,700 | ) |   |   | (18,700 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Net      loss                                              |   |                                                                                                                                                                                   | (6,382,934  | )      |                                                                                                                                                                                                    |   | (3,246,127  | )                |   |   | (17,297,980      | )      |   |                | (8,755,543  | )      |   |   | (13,908,809 | ) |   |   | (31,206,789 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Weighted      average number of outstanding shares         |   |                                                                                                                                                                                   | 114,700,557 |   |                                                                                                                                                                                                    |   | 111,878,422 |             |   |   | 113,610,124      |   |   |                | 107,416,090 |   |   |   | 102,464,307 |   |   |   | 104,386,242 |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |
| Basic      and diluted loss per share                      |   |                                                                                                                                                                                   | (0.06       | )      |                                                                                                                                                                                                    |   | (0.03       | )                |   |   | (0.15            | )      |   |                | (0.08       | )      |   |   | (0.14 | ) |   |   | (0.30 | ) |
|                                                       |   |                                                                                                                                                                                   |        |   |                                                                                                                                                                                                    |   |        |             |   |   |             |   |   |                |        |   |   |   |   |   |   |   |   |   |

----

| MANAS      PETROLEUM CORPORATION                                         |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
|--------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------|--------|------------------|--------|------------|---------------------|------------|
| (A      DEVELOPMENT STAGE COMPANY)                                       |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
| CONDENSED      CONSOLIDATED FINANCIAL STATEMENTS                         |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
| UNAUDITED                                                                |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
| CONDENSED      CONSOLIDATED CASH FLOW STATEMENT                          |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |
|                                                                     |   |                                  For the nine months ended |        |   | Period      from |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                | 05.25.2004 |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       | (Inception)      to |       |
|                                                                     |   |                                                                                                                                                                                              | 09.30.2008  |   |             |   | 09.30.2007 |                |       |   | 09.30.2008 |   |
|                                                                     |   | USD                                                                                                                                                                                               |        |   | USD              |   |       | USD                 |       |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| OPERATING      ACTIVITIES                                                |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Net      loss for the period                                             |   |                                                                                                                                                                                              | (17,297,980 | )      |             |   | (8,755,543 | )                   |       |   | (31,206,789 | ) |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| To      reconcile net loss to net cash used                              |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| in      operating activities                                             |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Minority      interest in net income                                     |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | 18,700 |   |
| Gain      from sale of investment                                        |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | (3,864,197 | ) |
| Loss      from sale of investment                                        |   |                                                                                                                                                                                              | -           |   |             |   | 900        |                |       |   | 900 |   |
| Equity      in net loss of associate                                     |   |                                                                                                                                                                                              | -           |   |             |   | 38,302     |                |       |   | 24,523 |   |
| Depreciation                                                             |   |                                                                                                                                                                                              | 36,709      |   |             |   | 8,018      |                |       |   | 83,342 |   |
| Amortization      of debt issuance costs                                 |   |                                                                                                                                                                                              | 51,860      |   |             |   | -          |                |       |   | 51,860 |   |
| Exchange      differences                                                |   |                                                                                                                                                                                              | (60,373     | )      |             |   | 18,195     |                |       |   | 28,570 |   |
| Interest      expense on contingently convertible loan                   |   |                                                                                                                                                                                              | 18,849      |   |             |   | -          |                |       |   | 18,849 |   |
| Interest      expense on debentures                                      |   |                                                                                                                                                                                              | 607,989     |   |             |   | -          |                |       |   | 607,989 |   |
| Increase      in participation liabilities                               |   |                                                                                                                                                                                              | 640,000     |   |             |   | -          |                |       |   | 640,000 |   |
| Decrease      / (increase) in receivables                                |   |                                                                                                                                                                                              | (64,615     | )      |             |   | (166,775   | )                   |       |   | (333,690 | ) |
| Decrease      / (increase) in other non-current assets                   |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | (62,279 | ) |
| (Decrease)      / increase in accounts payables                          |   |                                                                                                                                                                                              | 1,673,141   |   |             |   | (411,385   | )                   |       |   | 1,246,975 |   |
| (Decrease)      / increase in accrued expenses                           |   |                                                                                                                                                                                              | (537,748    | )      |             |   | 30,848     |                |       |   | 632,868 |   |
| Stock-based      compensation                                            |   |                                                                                                                                                                                              | 8,112,293   |   |             |   | 5,578,623  |                |       |   | 15,357,582 |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Cash      flow from operating activities                                 |   |                                                                                                                                                                                              | (6,819,873  | )      |             |   | (3,658,817 | )                   |       |   | (16,754,795 | ) |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| INVESTING      ACTIVITIES                                                |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Purchase      of tangible fixed assets and computer software             |   |                                                                                                                                                                                              | (130,160    | )      |             |   | (74,043    | )                   |       |   | (408,908 | ) |
| Sale      of tangible fixed assets and computer software                 |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | 79,326 |   |
| Proceeds      from sale of investment                                    |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | 4,000,000 |   |
| Restricted      cash                                                     |   |                                                                                                                                                                                              | (9,115,000  | )      |             |   | -          |                |       |   | (9,115,000 | ) |
| Acquisition      of investment in associate                              |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | (67,747 | ) |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Cash      flow from investing activities                                 |   |                                                                                                                                                                                              | (9,245,160  | )      |             |   | (74,043    | )                   |       |   | (5,512,329 | ) |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| FINANCING      ACTIVITIES                                                |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Contribution      share capital founders                                 |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | 80,019 |   |
| Issuance      of units                                                   |   |                                                                                                                                                                                              | 1,849,429   |   |             |   | 13,208,055 |                |       |   | 15,057,484 |   |
| Issuance      of contingently convertible loan                           |   |                                                                                                                                                                                              | 1,680,000   |   |             |   | -          |                |       |   | 1,680,000 |   |
| Issuance      of debentures                                              |   |                                                                                                                                                                                              | 3,760,000   |   |             |   | -          |                |       |   | 3,760,000 |   |
| Issuance      of warrants                                                |   |                                                                                                                                                                                              | 670,571     |   |             |   | -          |                |       |   | 670,571 |   |
| Cash      arising on recapitalization                                    |   |                                                                                                                                                                                              | -           |   |             |   | 6,510      |                |       |   | 6,510 |   |
| Shareholder      loan repaid                                             |   |                                                                                                                                                                                              | (39,329     | )      |             |   | (372,162   | )                   |       |   | (3,385,832 | ) |
| Shareholder      loan raised                                             |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | 4,653,720 |   |
| Increase      in bank loan                                               |   |                                                                                                                                                                                              | 1,220,000   |   |             |   | -          |                |       |   | 1,220,000 |   |
| Payment      of debt issuance costs                                      |   |                                                                                                                                                                                              | (279,910    | )      |             |   | -          |                |       |   | (279,910 | ) |
| (Decrease)      / increase in bank overdraft                             |   |                                                                                                                                                                                              | (2,305      | )      |             |   | 20,325     |                |       |   | - |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Cash      flows from financing activities                                |   |                                                                                                                                                                                              | 8,858,456   |   |             |   | 12,862,728 |                |       |   | 23,462,561 |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Net      change in cash and cash equivalents                             |   |                                                                                                                                                                                              | (7,206,578  | )      |             |   | 9,129,868  |                |       |   | 1,195,437 |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Cash      and cash equivalents at the beginning of the period            |   |                                                                                                                                                                                              | 8,480,771   |   |             |   | 1,090,098  |                |       |   | - |   |
| Currency      translation effect on cash and cash equivalents            |   |                                                                                                                                                                                              | 67,870      |   |             |   | (18,083    | )                   |       |   | 146,626 |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Cash      and cash equivalents at the end of the period                  |   |                                                                                                                                                                                              | 1,342,063   |   |             |   | 10,201,883 |                |       |   | 1,342,063 |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Supplement      schedule of non-cash investing and financing activities: |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |
| Forgiveness      of debt by major shareholder                            |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | 1,466,052 |   |
| Deferred      consideration for interest in CJSC South Petroleum Co.     |   |                                                                                                                                                                                              | -           |   |             |   | -          |                |       |   | 193,003 |   |
| Warrants      issued to pay placement commission expenses                |   |                                                                                                                                                                                              | -           |   |             |   | 2,689,910  |                |       |   | 2,689,910 |   |
| Debenture      interest paid in common shares                            |   |                                                                                                                                                                                              | 57,449      |   |             |   | -          |                |       |   | 57,449 |   |
|                                                                     |   |                                                                                                                                                                                              |        |   |             |   |       |                |       |   |   |   |

----

| MANAS      PETROLEUM CORPORATION                                          |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |
|---------------------------------------------------------------------------|--------|-----------------------|-------------|--------|--------------------|--------|---------|---------------------------------|--------|--------|-------------------------------------------------------|--------|--------|-----------------------------------------------------|-------------|--------|----------------------------------------------|--------|---------|
| (A      DEVELOPMENT STAGE COMPANY)                                        |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |
| CONDENSED      CONSOLIDATED FINANCIAL STATEMENTS                          |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |
| UNAUDITED                                                                 |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |
| CONDENSED      CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY /(DEFICIT) |   |                  |        |   |               |   |    |                            |   |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |
|  SHAREHOLDERS'      EQUITY / (DEFICIT)                               |   | Number      of Shares |        |   | Share      Capital |   |    | Additional      paid-in capital |   |   | Deficit      accumulated during the development stage |   |   | Accumulated      Other Compre-hensive Income (Loss) |        |   | Total      share-holders' equity / (deficit) |   |    | Compre-hensive      Income (Loss) |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |
| Balance      May 25, 2004                                                 |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | -           |   |                                         |   | -       |   |   |   | - |   |   |   | - |   |
| Contribution      share capital from founders                             |   |                  | 80,000,000  |   |               |   | 80,000  |                            |   |   | 19                                                    |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 80,019 |   |   |   | - |   |
| Currency      translation adjustment                                      |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | -           |   |                                         |   | (77,082 | ) |   |   | (77,082 | ) |   |   | (77,082 | ) |
| Net      loss for the period                                              |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | (601,032    | )      |                                         |   | -       |   |   |   | (601,032 | ) |   |   | (601,032 | ) |
| Balance      December 31, 2004                                            |   |                  | 80,000,000  |   |               |   | 80,000  |                            |   |   | 19                                                    |   |   |                                                | (601,032    | )      |                                         |   | (77,082 | ) |   |   | (598,095 | ) |   |   | (678,114 | ) |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
| Balance      January 1, 2005                                              |   |                  | 80,000,000  |   |               |   | 80,000  |                            |   |   | 19                                                    |   |   |                                                | (601,032    | )      |                                         |   | (77,082 | ) |   |   | (598,095 | ) |   |   |   |   |
| Currency      translation adjustment                                      |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                |        |   |                                         |   | 218,699 |   |   |   | 218,699 |   |   |   | 218,699 |   |
| Net      loss for the year                                                |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | (1,993,932  | )      |                                         |   | -       |   |   |   | (1,993,932 | ) |   |   | (1,993,932 | ) |
| Balance      December 31, 2005                                            |   |                  | 80,000,000  |   |               |   | 80,000  |                            |   |   | 19                                                    |   |   |                                                | (2,594,964  | )      |                                         |   | 141,617 |   |   |   | (2,373,328 | ) |   |   | (1,775,233 | ) |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
| Balance      January 1, 2006                                              |   |                  | 80,000,000  |   |               |   | 80,000  |                            |   |   | 19                                                    |   |   |                                                | (2,594,964  | )      |                                         |   | 141,617 |   |   |   | (2,373,328 | ) |   |   |   |   |
| Forgiveness      of debt by major shareholder                             |   |                  | -           |   |               |   | -       |                            |   |   | 1,466,052                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 1,466,052 |   |   |   | - |   |
| Currency      translation adjustment                                      |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | -           |   |                                         |   | (88,153 | ) |   |   | (88,153 | ) |   |   | (88,153 | ) |
| Net      income for the year                                              |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | 1,516,004   |   |                                         |   | -       |   |   |   | 1,516,004 |   |   |   | 1,516,004 |   |
| Balance      December 31, 2006                                            |   |                  | 80,000,000  |   |               |   | 80,000  |                            |   |   | 1,466,071                                             |   |   |                                                | (1,078,960  | )      |                                         |   | 53,464  |   |   |   | 520,575 |   |   |   | 1,427,851 |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
| Balance      January 1, 2007                                              |   |                  | 80,000,000  |   |               |   | 80,000  |                            |   |   | 1,466,071                                             |   |   |                                                | (1,078,960  | )      |                                         |   | 53,464  |   |   |   | 520,575 |   |   |   |   |   |
| Recapitalization      transaction (Note 1)                                |   |                  | 20,110,400  |   |               |   | 20,110  |                            |   |   | (356,732                                              | )      |   |                                                | -           |   |                                         |   | -       |   |   |   | (336,622 | ) |   |   | - |   |
| Stock-based      compensation                                             |   |                  | 880,000     |   |               |   | 880     |                            |   |   | 7,244,409                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 7,245,289 |   |   |   | - |   |
| Private      placement of Units, issued for cash                          |   |                  | 10,330,152  |   |               |   | 10,330  |                            |   |   | 9,675,667                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 9,685,997 |   |   |   | - |   |
| Private      placement of Units                                           |   |                  | 10,709      |   |               |   | 11      |                            |   |   | (11                                                   | )      |   |                                                | -           |   |                                         |   | -       |   |   |   | - |   |   |   | - |   |
| Private      placement of Units, issued for cash                          |   |                  | 825,227     |   |               |   | 825     |                            |   |   | 3,521,232                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 3,522,057 |   |   |   | - |   |
| Currency      translation adjustment                                      |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | -           |   |                                         |   | 3,069   |   |   |   | 3,069 |   |   |   | 3,069 |   |
| Net      loss for the year                                                |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | (12,825,496 | )      |                                         |   | -       |   |   |   | (12,825,496 | ) |   |   | (12,825,496 | ) |
| Balance      December 31, 2007                                            |   |                  | 112,156,488 |   |               |   | 112,156 |                            |   |   | 21,550,636                                            |   |   |                                                | (13,904,456 | )      |                                         |   | 56,533  |   |   |   | 7,814,870 |   |   |   | (12,822,427 | ) |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
| Balance      January 1, 2008                                              |   |                  | 112,156,488 |   |               |   | 112,156 |                            |   |   | 21,550,636                                            |   |   |                                                | (13,904,456 | )      |                                         |   | 56,533  |   |   |   | 7,814,870 |   |   |   |   |   |
| Stock-based      compensation                                             |   |                  | 1,369,893   |   |               |   | 1,370   |                            |   |   | 4,536,211                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 4,537,580 |   |   |   | - |   |
| Currency      translation adjustment                                      |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | -           |   |                                         |   | 1,621   |   |   |   | 1,621 |   |   |   | 1,621 |   |
| Net      loss for the period                                              |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | (6,163,605  | )      |                                         |   | -       |   |   |   | (6,163,605 | ) |   |   | (6,163,605 | ) |
| Balance      March 31, 2008                                               |   |                  | 113,526,381 |   |               |   | 113,526 |                            |   |   | 26,086,846                                            |   |   |                                                | (20,068,062 | )      |                                         |   | 58,154  |   |   |   | 6,190,466 |   |   |   | (6,161,984 | ) |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
| Balance      April 1, 2008                                                |   |                  | 113,526,381 |   |               |   | 113,526 |                            |   |   | 26,086,846                                            |   |   |                                                | (20,068,062 | )      |                                         |   | 58,154  |   |   |   | 6,190,466 |   |   |   | (6,161,984 | ) |
| Stock-based      compensation                                             |   |                  | 43,741      |   |               |   | 44      |                            |   |   | 1,814,052                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 1,814,096 |   |   |   | - |   |
| Issuance      of warrants                                                 |   |                  | -           |   |               |   | -       |                            |   |   | 240,000                                               |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 240,000 |   |   |   | - |   |
| Beneficial      Conversion Feature                                        |   |                  | -           |   |               |   | -       |                            |   |   | 557,989                                               |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 557,989 |   |   |   | - |   |
| Currency      translation adjustment                                      |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | -           |   |                                         |   | (1,750  | ) |   |   | (1,750 | ) |   |   | (1,750 | ) |
| Net      loss for the period                                              |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | (4,751,440  | )      |                                         |   | -       |   |   |   | (4,751,440 | ) |   |   | (4,751,440 | ) |
| Balance      June 30, 2008                                                |   |                  | 113,570,122 |   |               |   | 113,570 |                            |   |   | 28,698,888                                            |   |   |                                                | (24,819,502 | )      |                                         |   | 56,404  |   |   |   | 4,049,361 |   |   |   | (10,915,174 | ) |
|                                                                      |   |                  |        |   |               |   |    |                            |   |   |                                                  |   |   |                                                |        |   |                                         |   |    |   |   |   |   |   |   |   |   |   |
| Balance      July 1, 2008                                                 |   |                  | 113,570,122 |   |               |   | 113,570 |                            |   |   | 28,698,888                                            |   |   |                                                | (24,819,502 | )      |                                         |   | 56,404  |   |   |   | 4,049,361 |   |   |   | (10,915,174 | ) |
| Stock-based      compensation                                             |   |                  | -           |   |               |   | -       |                            |   |   | 1,760,617                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 1,760,617 |   |   |   | - |   |
| Private      placement of Units, issued for cash                          |   |                  | 4,000,000   |   |               |   | 4,000   |                            |   |   | 1,845,429                                             |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 1,849,429 |   |   |   | - |   |
| Issuance      of warrants                                                 |   |                  | -           |   |               |   | -       |                            |   |   | 430,571                                               |   |   |                                                | -           |   |                                         |   | -       |   |   |   | 430,571 |   |   |   | - |   |
| Currency      translation adjustment                                      |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | -           |   |                                         |   | 6,195   |   |   |   | 6,195 |   |   |   | 6,195 |   |
| Net      loss for the period                                              |   |                  | -           |   |               |   | -       |                            |   |   | -                                                     |   |   |                                                | (6,382,934  | )      |                                         |   | -       |   |   |   | (6,382,934 | ) |   |   | (6,382,934 | ) |
| Balance      September 30, 2008                                           |   |                  | 117,570,122 |   |               |   | 117,570 |                            |   |   | 32,735,505                                            |   |   |                                                | (31,202,436 | )      |                                         |   | 62,600  |   |   |   | 1,713,239 |   |   |   | (17,291,913 | ) |

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|                           |   | USD      (held in USD) |      |   | USD      (held in EUR) |   |   | USD      (held in CHF) |   |   | USD      (held in other currencies) |   |   | USD TOTAL      Sept 30, 2008 |   |   | USD      TOTAL 2007 |   |      | USD      TOTAL 2006 |   |
|--------------------------------|--------|------------------------|-----------|--------|------------------------|--------|--------|------------------------|--------|--------|-------------------------------------|--------|--------|-----------------------------------|--------|--------|---------------------|--------|-----------|---------------------|--------|
| Bank      and postal accounts  |   |                   | 1,317,260 |   |                   |   | 1,006  |                   |   |   | 14,406                              |   |   |                              | 9,391  |   |                |   | 1,342,063 |                |   |   | 8,480,771 |   |   |   | 1,090,098 |   |
| Cash      and Cash Equivalents |   |                   | 1,317,260 |   |                   |   | 1,006  |                   |   |   | 14,406                              |   |   |                              | 9,391  |   |                |   | 1,342,063 |                |   |   | 8,480,771 |   |   |   | 1,090,098 |   |

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| 2008                                          |   | Office      Equipment & Furniture |    |   | Vehicles |   |    | Leasehold      Improvements |   |   | Total  |   |
|-----------------------------------------------|--------|---------------------------------------|---------|--------|----------|--------|---------|-----------------------------|--------|--------|--------|--------|
|                                          |   | USD                                   |    |   | USD      |   |    | USD                         |   |   | USD    |   |
| Cost      at January 1                        |   |                                  | 77,845  |   |     |   | 53,000  |                        |   |   | 42,424 |   |   |   | 173,269 |   |
| Additions                                     |   |                                  | 50,830  |   |     |   | 74,379  |                        |   |   | 4,952  |   |   |   | 130,160 |   |
| Disposals                                     |   |                                  | -       |   |     |   | -       |                        |   |   | -      |   |   |   | - |   |
| Cost      at September 30                     |   |                                  | 128,674 |   |     |   | 127,379 |                        |   |   | 47,375 |   |   |   | 303,429 |   |
|                                          |   |                                  |    |   |     |   |    |                        |   |   |   |   |   |   |   |   |
| Accumulated      depreciation at January 1    |   |                                  | (10,471 | )      |     |   | (9,000  | )                           |   |   | (724   | )      |   |   | (20,195 | ) |
| Depreciation                                  |   |                                  | (18,346 | )      |     |   | (11,339 | )                           |   |   | (7,025 | )      |   |   | (36,709 | ) |
| Disposals                                     |   |                                  | -       |   |     |   | -       |                        |   |   | -      |   |   |   | - |   |
| Accumulated      depreciation at September 30 |   |                                  | (28,817 | )      |     |   | (20,339 | )                           |   |   | (7,748 | )      |   |   | (56,904 | ) |
|                                          |   |                                  |    |   |     |   |    |                        |   |   |   |   |   |   |   |   |
| Net      book value at September 30           |   |                                  | 99,858  |   |     |   | 107,040 |                        |   |   | 39,627 |   |   |   | 246,524 |   |

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|                                                    |                   |   | Equity      share  |   |   | Equity      share |   |   | Equity      share |   |
|---------------------------------------------------------|------------------------|--------|--------------------|--------|--------|-------------------|--------|--------|-------------------|--------|
|                                                    | Country                |   | Sept      30, 2008 |   |   | Dec      31, 2007 |   |   | Dec      31, 2006 |   |
| DWM      Petroleum AG, Baar (1)                         | Switzerland            |   |               | 100    | %      |              |   | 100    | %                 |   |   | - |   |
| Manas      Petroleum AG, Baar (2)                       | Switzerland            |   |               | 100    | %      |              |   | 100    | %                 |   |   | - |   |
| CJSC      South Petroleum Company, Jalalabat (3)        | Kyrgyz      Republic   |   |               | 25     | %      |              |   | 25     | %                 |   |   | 25 | % |
| CJSC      Somon Oil Company, Dushanbe (4)               | Rep      of Tajikistan |   |               | 90     | %      |              |   | 90     | %                 |   |   | 90 | % |
| Manas      Petroleum of Chile Corporation, Victoria (5) | Canada                 |   |               | 100    | %      |              |   | n/a    |              |   |   | n/a |   |
| Manas      Management Services Ltd., Nassau (6)         | Bahamas                |   |               | 100    | %      |              |   | n/a    |              |   |   | n/a |   |
| Manas      Chile Energia Limitada, Santiago (7)         | Chile                  |   |               | 100    | %      |              |   | n/a    |              |   |   | n/a |   |

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The following table provides the total amount of transactions, whichhave been entered into with related parties for the relevant financialperiod:

| Board      of directors                                                                          |   |   | 01.01.-09.30.08 |   |   |   | 01.01.-09.30.07 |   |
|--------------------------------------------------------------------------------------------------|--------|--------|-----------------|--------|--------|--------|-----------------|--------|
|                                                                                             |   | USD    |            |   | USD    |   |
| Payments      to directors for office rent                                                       |   |   | 141,510         |   |   |   | 72,273          |   |
| Payments      to related companies controlled by directors for rendered consulting      services |   |   | 5,814           |   |   |   | -               |   |
|                                                                                             |   |   |            |   |   |   |            |   |
|                                                                                             |   |   | 09.30.08        |   |   |   | 09.30.07        |   |
|                                                                                             |   | USD    |            |   | USD    |   |
| Loan      from a director                                                                        |   |   | -               |   |   |   | 37,758          |   |

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|                               |   | For      the nine months ended |      |   | For      the nine months ended |   |
|------------------------------------|--------|--------------------------------|-----------|--------|--------------------------------|--------|
|                               |   | September      30, 2008        |      |   | September      30, 2007        |   |
|                               |   | USD                            |      |   | USD                            |   |
| Wages      and salaries            |   |                           | 7,193,389 |   |                           |   | 3,632,948 |   |
| Social      security contributions |   |                           | 106,026   |   |                           |   | 72,311 |   |
| Pension      fund contribution     |   |                           | 104,423   |   |                           |   | 2,128 |   |
| Other      personnel expenses      |   |                           | 468       |   |                           |   | 1,691 |   |
| Total      Personnel Costs         |   |                           | 7,404,306 |   |                           |   | 3,709,079 |   |

|                               |   | For      the three months ended |      |   | For      the three months ended |   |
|------------------------------------|--------|---------------------------------|-----------|--------|---------------------------------|--------|
|                               |   | September      30, 2008         |      |   | September      30, 2007         |   |
|                               |   | USD                             |      |   | USD                             |   |
| Wages      and salaries            |   |                            | 2,349,351 |   |                            |   | 1,987,431 |   |
| Social      security contributions |   |                            | 29,717    |   |                            |   | 25,577 |   |
| Pension      fund contribution     |   |                            | -31,662   |   |                            |   | -149 |   |
| Other      personnel expenses      |   |                            | -         |   |                            |   | - |   |
| Total      Personnel Costs         |   |                            | 2,347,406 |   |                            |   | 2,012,860 |   |

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| Item      2. | Management’s      Discussion and Analysis of Financial Condition and Results of      Operation |
|--------------|------------------------------------------------------------------------------------------------------|

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| ·   | Preliminary      interpretation of the new seismic data has been initiated in the Adelaide      office. |
|--------------------|---------------------------------------------------------------------------------------------------------|

| ·   | In      addition to the seismic program several initiatives have been undertaken      in relation to the seismic program. These include data exchange agreements      with neighboring licenses and the provision of funds to      Saratovneftegeofizika (SNG) (seismic contractors) for crew      upgrades. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The      project team in Adelaide has been primarily engaged in technical review      work to define prospects and leads. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------|

| ·   | Consolidation      of the database has been undertaken with data acquired in Bishkek      transferred to the database in Adelaide.  Reprocessing and      scanning of Soviet era seismic data and digitizing of well logs have      continued. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The      office in Bishkek has been involved in general office administration and      management,  building relationships with industry and government      and resolving various local taxationissues |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | On-going      database assembly with: |
|--------------------|---------------------------------------|

| o   | Digitization      of well wire line log data |
|---------------|----------------------------------------------|

| o   | Rectification      of scanned maps |
|---------------|------------------------------------|

| o   | Field      GPS quality control of well head locations, and incorporation into Santos      mapping and seismic interpretation packages continued (DBMap and      Geoframe) |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| o   | Capture      of relevant information from Soviet-erareports |
|---------------|-------------------------------------------------------------|

| o   | Wireline      log and seismic data loaded into Geoframe master interpretation      project |
|---------------|--------------------------------------------------------------------------------------------|

| o   | Formation      tops data continued to be assembled and bulk loaded into Geoframe      interpretation package |
|---------------|--------------------------------------------------------------------------------------------------------------|

| ·   | Seismic      reprocessing project is complete. |
|--------------------|------------------------------------------------|

| ·   | Scanning      seismic project by SNG iscompleted. |
|--------------------|---------------------------------------------------|

| ·   | All      original hardcopy seismic was scanned in Australia by contractor New Wave      to provide a further dataset, which is being utilized as a final quality      check against the reprocessed and SNG scanning.  This data set      was found to be more workable and has been used for current      mapping. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Geophysical      interpretation of digital seismic isproceeding. |
|--------------------|------------------------------------------------------------------|

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| ·   | Seismic      interpretation and mapping continued in each of the Tuzluk, Soh, West Soh,      and Nanai permits. |
|--------------------|-----------------------------------------------------------------------------------------------------------------|

| ·   | Mapping      has been incorporated into plans for proposed new seismic acquisition,      with minor adjustments being made to the location of lines in the 2D      acquisition grid. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Rock      sample petrography and geochemistry reports  completed. |
|--------------------|-------------------------------------------------------------------|

| ·   | Integration      of well velocity data and wireline log data into seismic interpretation      project. |
|--------------------|--------------------------------------------------------------------------------------------------------|

| ·   | Geological      well to well correlations. |
|--------------------|--------------------------------------------|

| ·   | Thermal      history modeling. |
|--------------------|--------------------------------|

| ·   | Presentations      have been made to the State Agency of Geology (New Director) outlining the      progress made in relation to seismic  acquisition. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Discussions      with the State Agency and others concerning the new Sub Soil laws and the      proposed imposition of license fees continued and representations made      through the IBC (International Business Council). These discussions are      ongoing at the present time. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | General      license administration and reporting continued during the quarter and half      yearly reports were prepared. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------|

| ·   | Digitizing      of electric logs and maps continued during the  period. |
|--------------------|-------------------------------------------------------------------------|

| ·   | Continued      to build in-country relationships with industry and      government. |
|--------------------|-------------------------------------------------------------------------------------|

| ·   | The      Jalalabad office provided support to the seismic field operations and to      drilling planning. |
|--------------------|-----------------------------------------------------------------------------------------------------------|

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