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

FORM 40-F

[Check one]

[   ] Registration statement pursuant to Section
  12 of the Securities Exchange Act of 1934

or

[X] Annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934

|For the fiscal year ended December 31, 2006 | Commission File Number
|------------------------------------------- | ----------------------
|                                            | 001-31891             

TRANSGLOBE ENERGY
CORPORATIONExact name of Registrant as specified in its
charter)

_________________________________________(Translation of
Registrant's name into English (if applicable))

Alberta, Canada(Province or other jurisdiction of
incorporation or organization)

1311(Primary Standard Industrial Classification Code
Number (if applicable))

_____________(I.R.S. Employer Identification Number
(if applicable))

Suite 2500 605  Fifth Avenue S.W.Calgary,
Alberta Canada T2P 3H5 (403) 264-9888(Address and telephone
number of Registrant's principal executive offices)

John L. Mericle Harris, Mericle & Wakayama 999
Third Avenue, Suite 3210 Seattle, Washington 98104 (206)
621-1818(Name, address (including zip code) and telephone number
(including area code) of agent for service in the United States)

Securities registered or to be registered pursuant to Section
12(b) of the Act.

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None(Title of Class)

Securities registered or to be registered pursuant to Section
12(g) of the Act.

Common Shares Without Par Value(Title of Class)

Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act.

None(Title of Class)

For annual reports, indicate by check mark the information filed
with this Form:

[X] Annual information form
                       [X]
Audited annual financial statements

Indicate the number of outstanding shares of each of the
issuer's classes of capital or common stock as of the close of the period
covered by the annual report.

The number of shares outstanding of the issuer's common
shares as of December 31, 2006 was 58,882,439.

______________________________

Indicate by check mark whether the Registrant by filing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934 (the "Exchange Act"). If "Yes" is marked, indicate the filing number
assigned to the Registrant in connection with such Rule.

Yes [   ] No [X]

Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Exchange Act during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

Yes [X] No [   ]

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PRINCIPAL DOCUMENTS

The following documents have been filed as part of this Annual
Report on Form 40-F:

A. Annual Information Form

For the Registrants Annual Information Form for the fiscal
year ended December 31, 2006, see Exhibit 1 of this Annual Report on Form
40-F.

B. Audited Annual Financial Statements

The Registrants consolidated audited annual financial
statements, including the report of Independent Registered Chartered Accountants
with respect thereto, are incorporated by reference and included herein  see
Exhibit 2 of this Annual Report on Form 40-F. The Registrants financial
statements have been prepared in accordance with Canadian generally accepted
accounting principles (Canadian GAAP) and reconciled to United States
generally accepted accounting principles (US GAAP) - see Note 16 of the Notes
to Consolidated Financial Statements of the Registrants consolidated audited
financial statements, reconciling the material differences between Canadian and
US GAAP.

C. Managements Discussion and Analysis

For Managements Discussion and Analysis of the Registrant for
the fiscal year ended December 31, 2006 - see Exhibit 3 of this Annual Report on
Form 40-F.

DISCLOSURE CONTROLS AND PROCEDURES

As of the fiscal year ended December 31, 2006, an evaluation
was carried out under the supervision, and with the participation, of the
Registrants management, including the Chief Executive Officer and Chief
Financial Officer, of the effectiveness of the Registrants disclosure controls
and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on
that evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that as of the end of the fiscal year, the design and operation of
these disclosure controls and procedures were effective to ensure that
information required to be disclosed by the Registrant in reports it files or
submits under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange Commissions
(SEC) rules and forms.

MANAGEMENTS REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING

Management is responsible for establishing and maintaining
adequate internal control over financial reporting for the Company. Management
has designed such internal control over financial reporting to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
Canadian generally accepted accounting principles (GAAP), including a
reconciliation to U.S. GAAP.

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Because of its inherent limitations, the Companys internal
control over financial reporting may not prevent or detect all possible
misstatements or frauds. Also, projections of any evaluation of effectiveness to
future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with policies
or procedures may deteriorate.

To evaluate the effectiveness of the Companys internal control
over financial reporting, Management has used the Internal Control  Integrated
Framework, which is a suitable, recognized control framework established by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Management has assessed the effectiveness of the Companys internal control over
financial reporting for the fiscal year ended December 31, 2006 and concluded
that such internal control over financial reporting is effective.

During the period covered by this Annual Report, no changes
occurred in the Companys internal control over financial reporting that have
materially affected, or are reasonably likely to materially affect, the
Companys internal control over financial reporting.

This Annual Report does not include an attestation report of
the Companys registered public accounting firm regarding internal control over
financial reporting. Managements report was not subject to attestation by the
Companys registered public accounting firm pursuant to temporary rules of the
Securities and Exchange Commission that permit the Company to provide only
Managements report in this Annual Report.

NOTICES PURSUANT TO REGULATION BTR

None.

CODE OF ETHICS FOR CHIEF
EXECUTIVE OFFICER, CHIEF FINANCIAL OFFICER, AND OFFICERS AND DIRECTORS

TransGlobe has adopted Codes of Ethics for its Chief Executive
Officer, Chief Financial Officer, directors and officers. The Company has
previously filed its Codes with the SEC as part of the Companys Annual Report
on Form 40-F for the fiscal year ended December 31, 2005. Shareholders may
obtain a copy upon request, addressed to The Secretary, TransGlobe Energy
Corporation, Suite 2500, 605  5th Avenue, S.W., Calgary, Alberta,
T2P 3H5, Canada. The Company has also posted its Codes on its internet website
at http://www.trans-globe.com/s/CodeofConduct.asp. All
amendments to the codes and all waivers of the codes with respect to any of the
persons covered by them will be filed with the SEC and posted on the SECs
Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system at
www.sec.gov.

CORPORATE GOVERNANCE GUIDELINES

The Registrant has adopted corporate governance guidelines and
established committees and charters regarding such matters as, but not limited
to: audit committee, director qualification standards and responsibilities,
director compensation and management succession. The Companys Audit Committee
Charter is included herein as Schedule C to the Companys Annual Information
Form. The guidelines will be made available to any shareholder who requests
them.

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AUDIT COMMITTEE FINANCIAL EXPERT

The Registrants Board of Directors has determined that it has
at least one audit committee financial expert serving on its audit committee.
Mr. Fred J. Dyment has been determined by the Board of TransGlobe to meet the
audit committee financial expert criteria prescribed by the SEC and is
independent, as that term is defined by the AMEXs listing standards applicable
to the Registrant. Mr. Dyment received a Chartered Accountant designation from
the Province of Ontario in 1972 and is a member of the Alberta Institute of
Chartered Accountants. He has over 30 years of financial, business, executive
and international management experience at several mid-size public corporations
where he served as President, CEO, CFO and director. Currently, Mr. Dyment sits
as a director on several other public companies. The SEC has indicated that the
designation of Mr. Dyment as an audit committee financial expert does not make
him an expert for any purpose, impose any duties, obligations or liability on
him that are greater than those imposed on members of the Audit Committee and
Board of Directors who do not carry this designation, or affect the duties,
obligations or liability of any other member of the Audit Committee.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The aggregate fees for professional services rendered by
Deloitte & Touche LLP for TransGlobe and its subsidiaries for the years
ending December 31, 2006 and December 31, 2005 totaled $252,988 and $109,519,
respectively, as detailed in the following table. All funds are in Canadian
dollars:

Year Ended December 31, 2006
    Year Ended December 31, 2005Audit Fees
    $177,844
    $74,360Audit Related Fees
    $30,330
    $29,537Tax Fees
    $5,937
    $5,622All Other Fees
    $38,877
    $0TOTAL
    $252,988
    $109,519


The nature of the services provided by Deloitte & Touche
LLP under each of the categories indicated in the table is described below.

Audit and Interim Review Fees

Audit fees were for professional services rendered by Deloitte
& Touche LLP for the audit of the Registrants annual financial statements
and services provided in connection with statutory and regulatory filings or
engagements.

Interim review fees were for professional services rendered by
Deloitte & Touche LLP for the review of the Registrants interim quarterly
financial statements and services provided in connection with statutory and
regulatory filings or engagements.

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Audit Related Fees

In 2006 and 2005, no fees for services were incurred other than
those described above under Audit Fees.

Tax Fees

Tax fees were for tax compliance, tax advice and tax planning
professional services. These services consisted of: tax compliance, including
the review of tax returns; and tax planning and advisory services relating to
common forms of domestic and international taxation (i.e. income tax, capital
tax, goods and services tax and payroll tax).

All Other Fees

In 2006 other fees were for an annual subscription service to
Petroview, a software program for oil and gas reconnaissance. In 2005 no fees
for services were incurred other than those described above under Audit Fees,
and Tax Fees.

PRE-APPROVAL POLICIES AND PROCEDURES

It is within the mandate of TransGlobes Audit Committee to
approve all audit and non-audit related fees. The Audit Committee will be
informed routinely as to the non-audit services actually provided by the auditor
pursuant to this pre-approval process. The auditors also present the estimate
for the annual audit related services to the Committee for approval prior to
undertaking the annual audit of the financial statements.

OFF-BALANCE SHEET ARRANGEMENTS

None.

DISCLOSURE OF CONTRACTUAL OBLIGATIONS

A table setting forth the Registrants contractual commitments
is set forth on page 35 of the Registrants Management Discussion and Analysis
incorporated by reference and included herein as Exhibit 3 of this Annual Report
on Form 40-F.

IDENTIFICATION OF THE AUDIT COMMITTEE

The Registrant has a separately designated standing Audit
Committee. The members of the Audit Committee are:

| | Chair:   | Fred Dyment   
| | -------- | --------------
| | Members: | Robert Halpin 
| |          | Geoffrey Chase

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FORWARD-LOOKING STATEMENTS

This Report contains forward looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Certain
statements contained in this Annual Report on form 40-F and in certain documents
incorporated by reference herein, constitute forward-looking statements. These
statements relate to future events or the Company's future performance. All
statements other than statements of historical fact may be forward-looking
statements. Forward-looking statements are often, but not always, identified by
the use of words such as "seek", "anticipate", "plan", "continue", "estimate",
"expect", "may", "will", "project", "predict", "potential", "targeting",
"intend", "could", "might", "should", "believe" and similar expressions. These
statements involve known and unknown risks, uncertainties and other factors that
may cause actual results or events to differ materially from those anticipated
in such forward-looking statements. Actual operational and financial results may
differ materially from TransGlobe's expectations contained in the
forward-looking statements as a result of various factors, many of which are
beyond the control of the Company. These factors include, but are not limited
to, unforeseen changes in the rate of production from TransGlobe's oil and gas
fields, changes in the price of crude oil and natural gas, adverse technical
factors associated with exploration, development, production or transportation
of TransGlobe's crude oil and natural gas reserves, changes or disruptions in
the political or fiscal regimes in TransGlobe's areas of activity, changes in
Canadian, Egyptian, Yemen or American tax, energy or other laws or regulations,
changes in significant capital expenditures, delays in production starting up
due to an industry shortage of skilled manpower, equipment or materials, and the
cost of inflation.

In particular, this Annual Report and the documents
incorporated by reference herein contain forward-looking statements pertaining
to the following:

- the quantity of reserves;
- oil and natural gas production levels;
- capital expenditure programs;
- projections of market prices and costs;
- supply and demand for oil and natural gas;
- expectations regarding the Company's ability to raise capital and to
  continually add to reserves through exploration, acquisitions and development;
  and
- treatment under government regulatory and taxation regimes.

The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of the risk factors
set forth below and elsewhere in this Annual Report:

- volatility in market prices for oil and natural gas;
- liabilities and risks inherent in oil and natural gas operations;
- uncertainties associated with estimating reserves;
- competition for, among other things, capital, acquisitions of reserves,
  undeveloped lands, equipment and skilled personnel;
- incorrect assessments of the value of acquisition; and
- geological, technical, drilling and processing problems.

The Company believes that the expectations reflected in those
forward looking statements are reasonable but no assurance can be given that
these expectations will prove to be correct and such forward-looking statements
included in, or incorporated by reference into, this Annual Report should not be
unduly relied upon. These statements speak only as of the date of this Annual
Report, as the case may be. The Company does not intend, and does not assume any
obligation, to update these forward-looking statements, except as required by
securities law.

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UNDERTAKING

The Registrant undertakes to make available, in person or by
telephone, representatives to respond to inquiries made by the Commission staff,
and to furnish promptly, when requested to do so by the Commission staff,
information relating to: the securities registered pursuant to Form 40-F; the
securities in relation to which the obligation to file an annual report on Form
40-F arises; or transactions in said securities.

ADDITIONAL INFORMATION

Additional information relating to TransGlobe may be found on
the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com and on the SECs Electronic Data
Gathering, Analysis, and Retrieval (EDGAR) system at www.sec.gov.

SIGNATURES

Pursuant to the requirements of the Exchange Act, the
Registrant certifies that it meets all of the requirements for filing on Form
40-F and has duly caused this annual report to be signed on its behalf by the
undersigned, thereto duly authorized.

|Registrant: | TRANSGLOBE ENERGY
      CORPORATION            
|----------- | -----------------------------------------------
|            |                                                
|By:         | /s/ Ross Clarkson                              
|            | Ross G. Clarkson, Chief Executive
      Officer
|Date:       | March 27, 2007                                 

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EXHIBITS

|1.   | TransGlobe Energy Corporation
        Annual Information Form for the year ended December 31, 2006.                                                                                                                                              
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                  
|2.   | Consolidated Audited Financial
        Statements for the year ended December 31, 2006.                                                                                                                                                          
|     |                                                                                                                                                                                                                                                  
|3.   | Managements Discussion
        and Analysis for the year ended December 31, 2006.                                                                                                                                                               
|     |                                                                                                                                                                                                                                                  
|4.   | TransGlobe Energy Corporation Charter of Audit Committee,
      amended and approved by the Board of Directors, March 15, 2007.*                                                                                                                 
|     |                                                                                                                                                                                                                                                  
|23.1 | Consent of Independent Registered
        Chartered Accountants, Deloitte & Touche LLP.                                                                                                                                                          
|     |                                                                                                                                                                                                                                                  
|23.2 | Consent of Independent Engineers:
        DeGolyer and MacNaughton Canada Limited.                                                                                                                                                               
|     |                                                                                                                                                                                                                                                  
|31.1 | Certification by the Chief Executive
        Officer of the Registrant pursuant to Rule 13a-14(a) of the Exchange Act,
        as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                             
|     |                                                                                                                                                                                                                                                  
|31.2 | Certification by the Chief Financial
        Officer of the Registrant pursuant to Rule 13a-14(a) of the Exchange Act,
        as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                             
|     |                                                                                                                                                                                                                                                  
|32.1 | Certification by the Chief Executive
        Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted
        pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                         
|     |                                                                                                                                                                                                                                                  
|32.2 | Certification by the Chief Financial
        Officer of the Registrant pursuant to 18 U.S.C. Section 1350, as adopted
        pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                         
|     |                                                                                                                                                                                                                                                  
|*    | Incorporated by reference and included herein as Schedule
      C of the TransGlobe Energy Corporation Annual Information Form for the
      year ended December 31, 2006, filed herewith as Exhibit 1 to the Annual
      Report on Form 40-F.

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