----

----

----

| Description                                                                                                                                                                                                            | Page      No.         |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------|
| FINANCIAL      INFORMATION:                                                                                                                                                                                            |                  |
|  Unaudited      Financial Statements                                                                                                                                                                              |                  |
|  Condensed      Consolidated Balance Sheets at June 30, 2007 and December 31,      2006                                                                                                                           |   F-1       |
|  Condensed      Consolidated Statement of Operations for the Three Months Ended June 30,      2007 and 2006, for the Six Months Ended June 30, 2007 and 2006 and for the      Period From Inception, May 25, 2004 |    F-2 |
| Consolidated      Statements of Cash Flows for the Six Months Ended June 30, 2007 and 2006      and for the Period From Inception, May 25, 2004                                                                        |   F-3       |
|  Condensed      Consolidated Statement of Shareholders’ Equity/(Deficit)                                                                                                                                    |  F-4             |
|  Notes      to Consolidated Financial Statements                                                                                                                                                                  |  F-5             |

----

| (A      DEVELOPMENT STAGE COMPANY)                                                                                                                   |                                                   |              |              |
|------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------|-------------------|-------------------|
| CONDENSED      CONSOLIDATED FINANCIAL STATEMENTS                                                                                                     |                                                   |              |
| UNAUDITED                                                                                                                                            |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| CONDENSED      CONSOLIDATED BALANCE SHEET                                                                                                            |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 | 06.30.2007                                             |              | 12.31.2006        |
|                                                                                                                                                 | USD                                                    |              | USD               |
|                                                                                                                                                 |        (As restated      | (As      restated |
|                                                                                                                                                 | see      Note 11)                                      |              | see      Note 11) |
| ASSETS                                                                                                                                               |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| Cash      and cash equivalents                                                                                                                       | 8,537,485                                              |              | 1,090,098         |
| Receivables                                                                                                                                          | 38,360                                                 |              | 48,683            |
|                                                                                                                                                 |                                                   |              |              |
| Total      current assets                                                                                                                            | 8,575,845                                              |              | 1,138,781         |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| Tangible      fixed assets                                                                                                                           | 53,529                                                 |              | 3,998             |
| Investment      in associate                                                                                                                         | 238,304                                                |              | 238,304           |
|                                                                                                                                                 |                                                   |              |              |
| Total      non-current assets                                                                                                                        | 291,833                                                |              | 242,302           |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| TOTAL      ASSETS                                                                                                                                    | 8,867,678                                              |              | 1,381,083         |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| LIABILITIES      AND SHAREHOLDERS' EQUITY                                                                                                            |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| Bank      overdraft                                                                                                                                  | 0                                                      |              | 19,003            |
| Deferred      consideration for interest in CJSC South Petroleum                                                                                     | 105,624                                                |              | 193,003           |
| Accounts      payable                                                                                                                                | 20,785                                                 |              | 70,918            |
| Accrued      expenses                                                                                                                                | 247,050                                                |              | 167,664           |
|                                                                                                                                                 |                                                   |              |              |
| Total      current liabilities                                                                                                                       | 373,459                                                |              | 450,588           |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| Loan      owed to a major shareholder                                                                                                                | 201,458                                                |              | 409,920           |
|                                                                                                                                                 |                                                   |              |              |
| Total      non-current liabilities                                                                                                                   | 201,458                                                |              | 409,920           |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| TOTAL      LIABILITIES                                                                                                                               | 574,917                                                |              | 860,508           |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| Common      stock (300,000,000 shares authorized, USD 0.001 par value, 111,320,552 and      80,000,000 shares, respectively, issued and outstanding) | 111,320                                                |              | 80,000            |
| Additional      paid-in capital                                                                                                                      | 14,696,083                                             |              | 1,466,071         |
| Foreign      currency translation reserve                                                                                                            | 53,602                                                 |              | 53,464            |
| Deficit      accumulated during the development stage                                                                                                | (6,568,244)                                            |              | (1,078,960)       |
|                                                                                                                                                 |                                                   |              |              |
| Total      shareholders' equity                                                                                                                      | 8,292,761                                              |              | 520,575           |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
|                                                                                                                                                 |                                                   |              |              |
| TOTAL      LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                                      | 8,867,678                                              |              | 1,381,083         |
|                                                                                                                                                 |                                                   |              |              |

----

| CONDENSED CONSOLIDATED STATEMENTS      OF OPERATIONS         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |
|--------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|-------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------|-------------|-------------|--------|-------------|--------|--------|
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |
|                                                         |   |                           For the three months ended |        |   |                                 For the six months ended |   |        | Period from |        |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   | 05.25.2004 |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   | (Inception)    to |   |
|                                                         |   |                                                                                                                                                     | 06.30.2007  |   |                                                                                                                                                                                       |   | 06.30.2006  |        |        |   | 06.30.2007  |   |   |   | 06.30.2006 |   |   |   | 06.30.2007 |   |
|                                                         |   | USD                                                                                                                                                      |        |   | USD                                                                                                                                                                                        |   |        | USD         |        |   | USD         |   |   | USD |   |
|                                                         |   | (Asrestated                                                                                                                                              |        |   |                                                                                                                                                                                       |   |        |        | (Asrestated |   |        |   |   |   |   | (Asrestated |   |
|                                                         |   | see Note11)                                                                                                                                              |        |   |                                                                                                                                                                                       |   |        |        | see Note11) |   |        |   |   |   |   | see Note11) |   |
| OPERATING      REVENUES                                      |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Other    revenues                                            |   |                                                                                                                                                     | -           |   |                                                                                                                                                                                       |   | -           |        |        |   | -           |   |   |   | - |   |   |   | 115,148 |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Total    revenues                                            |   |                                                                                                                                                     | -           |   |                                                                                                                                                                                       |   | -           |        |        |   | -           |   |   |   | - |   |   |   | 115,148 |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| OPERATING      EXPENSES                                      |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Personnel    costs                                           |   |                                                                                                                                                     | (1,679,208  | )      |                                                                                                                                                                                       |   | (50,168     | )           |        |   | (1,696,219  | )      |   |   | (92,655 | ) |   |   | (2,033,628 | ) |
| Exploration      costs                                       |   |                                                                                                                                                     | -           |   |                                                                                                                                                                                       |   | (37,731     | )           |        |   | (45,901     | )      |   |   | (77,964 | ) |   |   | (204,373 | ) |
| Depreciation                                                 |   |                                                                                                                                                     | (3,547      | )      |                                                                                                                                                                                       |   | (3,704      | )           |        |   | (3,808      | )      |   |   | (7,072 | ) |   |   | (34,807 | ) |
| Consulting    fees                                           |   |                                                                                                                                                     | (224,368    | )      |                                                                                                                                                                                       |   | (241,518    | )           |        |   | (422,201    | )      |   |   | (462,199 | ) |   |   | (2,753,425 | ) |
| Administrative      costs                                    |   |                                                                                                                                                     | (3,217,783  | )      |                                                                                                                                                                                       |   | (282,435    | )           |        |   | (3,389,772  | )      |   |   | (438,601 | ) |   |   | (5,505,623 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Total operating      expenses                                |   |                                                                                                                                                     | (5,124,906  | )      |                                                                                                                                                                                       |   | (615,555    | )           |        |   | (5,557,902  | )      |   |   | (1,078,491 | ) |   |   | (10,531,857 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Gain from sale of      investment                            |   |                                                                                                                                                     | -           |   |                                                                                                                                                                                       |   | -           |        |        |   | -           |   |   |   | - |   |   |   | 3,864,197 |   |
| Loss from sale of      investment                            |   |                                                                                                                                                     | (900        | )      |                                                                                                                                                                                       |   | -           |        |        |   | (900        | )      |   |   | - |   |   |   | (900 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| OPERATING    LOSS                                            |   |                                                                                                                                                     | (5,125,806  | )      |                                                                                                                                                                                       |   | (615,555    | )           |        |   | (5,558,802  | )      |   |   | (1,078,491 | ) |   |   | (6,553,412 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| NON-OPERATING INCOME /      (EXPENSE)                        |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Exchange      differences                                    |   |                                                                                                                                                     | (27,599     | )      |                                                                                                                                                                                       |   | 27,961      |        |        |   | (27,020     | )      |   |   | 26,375 |   |   |   | (49,910 | ) |
| Interest    income                                           |   |                                                                                                                                                     | 96,081      |   |                                                                                                                                                                                       |   | 4,429       |        |        |   | 101,637     |   |   |   | 8,659 |   |   |   | 147,847 |   |
| Interest      expense                                        |   |                                                                                                                                                     | (2,626      | )      |                                                                                                                                                                                       |   | (2,990      | )           |        |   | (4,775      | )      |   |   | (5,398 | ) |   |   | (72,727 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Loss before taxes and equity in      net income of associate |   |                                                                                                                                                     | (5,059,949  | )      |                                                                                                                                                                                       |   | (586,156    | )           |        |   | (5,488,960  | )      |   |   | (1,048,855 | ) |   |   | (6,528,202 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Taxes                                                        |   |                                                                                                                                                     | (351        | )      |                                                                                                                                                                                       |   | (354        | )           |        |   | (324        | )      |   |   | (354 | ) |   |   | (1,172 | ) |
| Equity in net loss of      associate                         |   |                                                                                                                                                     | -           |   |                                                                                                                                                                                       |   | -           |        |        |   | -           |   |   |   | - |   |   |   | (24,523 | ) |
| Minority interest in net      income                         |   |                                                                                                                                                     | -           |   |                                                                                                                                                                                       |   | -           |        |        |   | -           |   |   |   | - |   |   |   | (18,700 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Net loss                                                     |   |                                                                                                                                                     | (5,060,300  | )      |                                                                                                                                                                                       |   | (586,510    | )           |        |   | (5,489,284  | )      |   |   | (1,049,209 | ) |   |   | (6,572,597 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Weighted average number of      outstanding shares           |   |                                                                                                                                                     | 110,150,648 |   |                                                                                                                                                                                       |   | 100,110,400 |        |        |   | 105,130,524 |   |   |   | 100,110,400 |   |   |   | 100,909,359 |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |
| Basic loss per      share                                    |   |                                                                                                                                                     | (0.05       | )      |                                                                                                                                                                                       |   | (0.01       | )           |        |   | (0.05       | )      |   |   | (0.01 | ) |   |   | (0.07 | ) |
|                                                         |   |                                                                                                                                                     |        |   |                                                                                                                                                                                       |   |        |        |        |   |        |   |   |   |   |   |   |   |   |   |

----

| MANAS      PETROLEUM CORPORATION                             |                                                                                                                                                                                                              |   |              |   |                |
|--------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|---------------------|
| (A      DEVELOPMENT STAGE COMPANY)                           |                                                                                                                                                                                                              |   |              |   |                |
| CONDENSED      CONSOLIDATED FINANCIAL STATEMENTS             |                                                                                                                                                                                                              |   |              |   |
| UNAUDITED                                                    |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| CONDENSED      CONSOLIDATED CASH FLOW STATEMENT              |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                               For      the six months ended |   | Period      from  |
|                                                         |                                                                                                                                                                                                              |   |              |   | 05.25.2004          |
|                                                         |                                                                                                                                                                                                              |   |              |   | (Inception)      to |
|                                                         | 06.30.2007                                                                                                                                                                                                        |   | 06.30.2006        |   | 06.30.2007          |
|                                                         | USD                                                                                                                                                                                                               |   | USD               |   | USD                 |
|                                                         | (As      restated                                                                                                                                                                                                 |   |              |   | (As      restated   |
|                                                         | see      Note 11)                                                                                                                                                                                                 |   |              |   | see      Note 11)   |
| OPERATING      ACTIVITIES                                    |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| Net      loss for the period                                 |  (5,489,284)                                                                                                                                                                                                 |   |  (1,049,209) |   |  (6,572,597)   |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| 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                         |  -                                                                                                                                                                                                           |   |  -           |   |  (24,523)      |
| Depreciation                                                 |  3,808                                                                                                                                                                                                       |   |  7,072       |   |  34,807        |
| Exchange      differences                                    |  27,020                                                                                                                                                                                                      |   |  (26,375)    |   |  49,910        |
| Decrease      / (increase) in receivables                    |  16,207                                                                                                                                                                                                      |   |  61,723      |   |  (32,475)      |
| (Decrease)      / increase in accounts payables              |  (480,831)                                                                                                                                                                                                   |   |  (42,550)    |   |  (409,913)     |
| (Decrease)      / increase in accrued expenses               |  73,196                                                                                                                                                                                                      |   |  (24,967)    |   |  240,860       |
| Stock-based      compensation                                |  3,911,957                                                                                                                                                                                                   |   |  -           |   |  3,911,957     |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| Cash      outflow from operating activities                  |  (1,937,027)                                                                                                                                                                                                 |   |  (1,074,306) |   |  (6,683,971)   |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| INVESTING      ACTIVITIES                                    |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| Purchase      of tangible fixed assets and computer software |  (53,049)                                                                                                                                                                                                    |   |  -           |   |  (167,372)     |
| Sale      of tangible fixed assets and computer software     |  -                                                                                                                                                                                                           |   |  (3,433)     |   |  79,326        |
| Proceeds      from sale of investment                        |  -                                                                                                                                                                                                           |   |  -           |   |  4,000,000     |
| Acquisition      of investment in associate                  |  -                                                                                                                                                                                                           |   |  -           |   |  (67,747)      |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| Cash      inflow (outflow) from investing activities         |  (53,049)                                                                                                                                                                                                    |   |  (3,433)     |   |  3,844,207     |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| FINANCING      ACTIVITIES                                    |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| Contribution      share capital founders                     |  -                                                                                                                                                                                                           |   |  -           |   |  80,019        |
| Issuance      of units                                       |  9,685,997                                                                                                                                                                                                   |   |  -           |   |  9,685,997     |
| Cash      arising on recapitalization                        |  6,510                                                                                                                                                                                                       |   |  -           |   |  6,510         |
| Major      shareholder loan repaid                           |  (208,462)                                                                                                                                                                                                   |   |  -           |   |  (3,184,374)   |
| Major      shareholder loan raised                           |  -                                                                                                                                                                                                           |   |  805,632     |   |  4,653,720     |
| Related      company loan raised / (repaid)                  |  -                                                                                                                                                                                                           |   |  (112,890)   |   |  -             |
| Decrease      in bank overdraft                              |  (19,003)                                                                                                                                                                                                    |   |  -           |   |  -             |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| Cash      flows from financing activities                    |  9,465,042                                                                                                                                                                                                   |   |  692,742     |   |  11,241,872    |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
|                                                         |                                                                                                                                                                                                              |   |              |   |                |
| Net      change in cash and cash equivalents                 |  7,474,966                                                                                                                                                                                                   |   |  (384,997)   |   |  8,402,108     |

----

| 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 (As restated see Note 11)                                     |  Accumulated Other      Compre-hensive Income (Loss)                                                                 |  Total share-holders' equity      / (deficit) (As restated see Note 11)                                              |   Income (Loss) (As restated      see Note 11) |
|                                                                       |                                                                                                                      |                                                                                                                      |                                                                                                                      |                                                                                                                      |                                                                                                                      |                                                                                                                      |   |
| 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 DWM      Group                                     |     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                       |       3,911,077                                                                             |                     - |                     - |       3,911,957                                                                             |                     - |
| Private placement, issued for      cash                                    |     10,330,152                                                                                        |            10,330                                                  |       9,675,667                                                                             |                     - |                     - |       9,685,997                                                                             |                     - |
| Currency translation      adjustment                                       |                     - |                     - |                     - |                     - |                 138                       |                 138                       |                 138 |
| Net loss for the      period                                               |                     - |                     - |                     - |     (5,489,284)                                                                                       |                     - |     (5,489,284)                                                                                       |     (5,489,284) |
| Balance June 30,      2007                                                 |   111,320,552                                                                                                   |          111,320                                                             |     14,696,083                                                                                        |     (6,568,244)                                                                                       |            53,602                                                  |       8,292,761                                                                             |     (5,489,146) |
|                                                                       |                                                                                                                      |                                                                                                                      |                                                                                                                      |                                                                                                                      |                                                                                                                      |                                                                                                                      |   |

----

----

| Average      Rates                  | 01.01.-06.30.07 | 2006   | 2005   |
|-------------------------------------|-----------------|--------|--------|
|                                | TJS             | CHF    | CHF    |
| USD                                 | 3.4391          | 1.2536 | 1.2458 |
|                                |            |   |   |
| Balance      Sheet period-end rates | 06.30.07        | 2006   | 2005   |
|                                | TJS             | CHF    | CHF    |
| USD                                 | 3.4394          | 1.2198 | 1.3179 |

| 2007                                       |  Office      Equipment & Furniture |  Vehicles |  Leasehold      Improvements |  Total   |
|--------------------------------------------|---------------------------------------------|----------------|-----------------------------------|---------------|
|                                       |  USD                                   |  USD      |  USD                         |  USD     |
| Cost      at January 1                     |  5,436                                 |  -        |  -                           |  5,436   |
| Exchange      differencies                 |  (20)                                  |  -        |  -                           |  (20)    |
| Recapitalization      transaction (Note 1) |  3,407                                 |  -        |  -                           |  3,407   |
| Additions                                  |  49                                    |  53,000   |  -                           |  53,049  |
| Disposals                                  |  -                                     |  -        |  -                           |  -       |
| Cost      at June 30                       |  8,872                                 |  53,000   |  -                           |  61,872  |
|                                       |                                        |           |                              |          |
| Accumulated      depreciation at January 1 |  (1,438)                               |  -        |  -                           |  (1,438) |
| Exchange      differencies                 |  26                                    |  -        |  -                           |  26      |
| Recapitalization      transaction (Note 1) |  (3,123)                               |  -        |  -                           |  (3,123) |
| Depreciation                               |  (808)                                 |  (3,000)  |  -                           |  (3,808) |
| Disposals                                  |  -                                     |  -        |  -                           |  -       |
| Accumulated      depreciation at June 30   |  (5,344)                               |  (3,000)  |  -                           |  (8,344) |
|                                       |                                        |           |                              |          |
| Net      book value at June 30             |  3,529                                 |  50,000   |  -                           |  53,529  |

----

The following summarized financial information (in USD thousand) as ofJune 30, 2007 and for the period from January 1, 2007 to June 30, 2007 ispresented for CJSC South Petroleum Company which is a significant equity methodinvestee that is not consolidated:

| Current      assets                    | 101,819 |
|----------------------------------------|---------|
| Non-current      assets                | 46,896  |
| Current      liabilities               | 3,336   |
| Non-current      liabilities           | 147,485 |
| Gross      revenues                    | 0       |
| Gross      profit                      | 0       |
| Income      from continuing operations | -80,532 |
| Net      income                        | -80,532 |

----

| Board      of directors                                                                          | 01.01-06.30.07 | 01.01-06.30.06 |
|--------------------------------------------------------------------------------------------------|----------------|----------------|
|                                                                                             | USD            | USD            |
| Payments      to a director for office rent                                                      | 37,110         | 47,199         |
| Payments      to related companies controlled by directors for rendered consulting      services | -              | 192,139        |
|                                                                                             |           |           |
|                                                                                             | 06.30.07       | 06.30.06       |
|                                                                                             | USD            | USD            |
| Loan      from a director                                                                        | 201,458        | 4,543,905      |
| Loan      from a related company controlled by a director                                        | -              | 127,297        |

|                          | 06.30.07 | 12.31.06 |
|-------------------------------|----------|----------|
|                          | USD      | USD      |
| Within      1 year            | 37,714   | 9,948    |
| Between      2 and 5 years    | 67,820   | 4,972    |
| After      5 years            | 0        | 0        |
| Total      future commitments | 105,534  | 14,920   |

----

|                                                      |   |     2007                                                                        |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |
|-----------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|------------|--------|---------------------------------------------------------------------------|--------|------------|-----------------------------------------------------------------------|--------|--------|-----------------------------|--------|
|                                                      |   | As      restated                                                                                    |       |   | As      previously reported                                               |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |
|                                                      |   | USD                                                                                                 |       |   | USD                                                                       |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |
|                                                      |   |                                                                                                |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |
| At      June 30:                                          |   |                                                                                                |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |
| Investment      in associate                              |   |                                                                                                | 238,304    |   |                                                                      |   | -          |                                                                  |   |   |                        |   |   |   |   |   |   |   |   |   |
| Liability      in respect ofinvestment      in associate  |   |                                                                                                | -          |   |                                                                      |   | 253,743    |                                                                  |   |   |                        |   |   |   |   |   |   |   |   |   |
| Deficit      accumulated duringthe      development stage |   |                                                                                                | (6,568,244 | )      |                                                                      |   | (7,060,291 | )                                                                     |   |   |                        |   |   |   |   |   |   |   |   |   |
|                                                      |   |                                                                                                |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |   |   |
|                                                      |   |                                                                                                |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |   |   |
|                                                      |   |                   For the three months ended |       |   |               For the six months ended |   |       |              Inception to June 30, 2007 |   |
|                                                      |   |                                                                                                |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |   |   |
|                                                      |   | As      restated                                                                                    |       |   | As      previously reported                                               |   |       | As      restated                                                      |   |   | As      previously reported |   |   | As      restated |   |   | As      previously reported |   |
| For      the period endedJune      30, 2007:              |   | USD                                                                                                 |       |   | USD                                                                       |   |       | USD                                                                   |   |   | USD                         |   |   | USD |   |   | USD |   |
|                                                      |   |                                                                                                |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |   |   |
| Gain      from sale of investment                         |   |                                                                                                | -          |   |                                                                      |   | -          |                                                                  |   |   | -                           |   |   |   | - |   |   |   | 3,864,197 |   |   |   | 3,126,967 |   |
| Equity      in net income (loss)of      associate         |   |                                                                                                | -          |   |                                                                      |   | -          |                                                                  |   |   | -                           |   |   |   | - |   |   |   | (24,523 | ) |   |   | 201,960 |   |
| Minority      interest in net income                      |   |                                                                                                | -          |   |                                                                      |   | -          |                                                                  |   |   | -                           |   |   |   | - |   |   |   | (18,700 | ) |   |   | (5,308 | ) |
| Net      loss                                             |   |                                                                                                | (5,060,300 | )      |                                                                      |   | (5,060,300 | )                                                                     |   |   | (5,489,284                  | )      |   |   | (5,489,284 | ) |   |   | (6,572,597 | ) |   |   | (7,069,952 | ) |
|                                                      |   |                                                                                                |       |   |                                                                      |   |       |                                                                  |   |   |                        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic      and dilutedloss      per share                 |   |                                                                                                | (0.05      | )      |                                                                      |   | (0.05      | )                                                                     |   |   | (0.05                       | )      |   |   | (0.05 | ) |   |   | (0.07 | ) |   |   | (0.07 | ) |

----

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

| -   | Excellent      network in the CIS and Balkancountries, |
|---------------|--------------------------------------------------------|

| -   | increase      of value through exploration of known  structures, |
|---------------|------------------------------------------------------------------|

| -   | exploration      of new structures identified by previous geological research      and |
|---------------|----------------------------------------------------------------------------------------|

| -   | modern      geological knowledge and new concepts implemented to existing seismic and      well data base. |
|---------------|------------------------------------------------------------------------------------------------------------|

----

| -   | The      project team in Adelaide, Ausralia has been primarily engaged in technical      review work to define the prospects and leads in preparation for the      seismic program to be initiated in the third quarter of    2007. |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

| -   | The      office in Bishkek has been involved in general office administration and      management, acquiring new staff and building relationships with industry      and government. |
|---------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

| ·   | Exhibit      99.1 8-K announcing private placement filed on August 14,    2007 |
|--------------------|--------------------------------------------------------------------------------|

| ·   | Exhibit      99.5 8-K announcing the acquisition of DWM by the Company filed on April      17, 2007 |
|--------------------|-----------------------------------------------------------------------------------------------------|

----

----

----