SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________  FORM 10-Q  QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934  For Quarter Ended: September 30, 2009  Commission File Number: 000-26673 ___________________________________  WELWIND ENERGY INTERNATIONAL CORP. (Name of Small Business Issuer in Its Charter)  Delaware98-0207081(State or other jurisdiction of incorporation or organization)(IRS Employer Identification No.)  10-20172 113B Avenue, Maple Ridge, British Columbia, Canada V2X 0Y9 (Address of principal executive offices)  (604) 460-8487 (Registrant's telephone number, including area code)  Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or 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 S No £  Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes £ No £  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.  Large Accelerated Filer£Accelerated Filer£Non-Accelerated Filer£Smaller Reporting CompanyS  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes £ No S  Issuers revenues for its most recent fiscal year: Nil  As of December 14, 2009, there were 238,897,692 shares of the registrants Common Stock outstanding.    WELWIND ENERGY INTERNATIONAL CORPORATION (A Development Stage Company)  Report on Form 10-Q  PART I  FINANCIAL INFORMATIONItem 1.Unaudited Financial Statements3Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations15Item 3.Quantitative and Qualitative Disclosure About Market Risk29Item 4.Controls and Procedures29PART II  OTHER INFORMATIONItem 1.Legal Proceedings31Item 1A.Risk Factors31Item 2.Unregistered Sales of Equity Securities and Use of Proceeds31Item 3.Default Upon Senior Securities31Item 4.Submission of matters to a Vote of Security Holders32Item 5.Other Information32Item 6.Exhibits32  2   ITEM 1. FINANCIAL STATEMENTS   PART 1. FINANCIAL STATEMENTS  Welwind Energy International Corporation (A Development Stage Company) September 30, 2009     IndexConsolidated Balance Sheets4Consolidated Statements of Operations5Consolidated Statements of Cash Flows6Notes to the Consolidated Financial Statements7   3   Welwind Energy International Corporation (A Development Stage Company) Consolidated Balance Sheets (Expressed in Canadian Dollars) (unaudited)  September 30,
2009
$December 31,
2008
$ASSETSCurrent AssetsCash9,45528,734Taxes recoverable24,62516,985Prepaid expenses (Note 3)1,1041,104Total Current Assets35,18446,823Property and equipment, net (Note 4)558,657569,039Total Assets593,841615,862LIABILITIES AND STOCKHOLDERS EQUITYCurrent LiabilitiesAccounts payable197,130107,507Accrued liabilities178,590175,090Due to related parties (Note 5)1,581,8891,073,803Total Liabilities1,957,6091,356,400Commitments and Contingencies (Notes 1 and 8)Stockholders EquityPreferred Stock:Authorized: 10,000,000 shares, US $0.001 par value
Issued and outstanding: 10,000,000 shares
(2008  10,000,000 issued and outstanding)11,13711,137Common Stock:Authorized: 290,000,000 shares, US $0.001 par value
Issued and outstanding: 222,747,692 shares
(and 198,164,837, respectively)234,949218,321Additional paid-in capital19,864,72119,442,170Accumulated deficit(21,474,575)(20,412,166)Total Stockholders Equity(1,363,768)(740,538)Total Liabilities and Stockholders Equity593,841615,862  (The accompanying notes are an integral part of these consolidated financial statements)  4   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  For the
Three Months
Ended
September 30,
2009
$For the
Three Months
Ended
September 30,
2008
$For the
Nine Months
Ended
September 30,
2009
$For the
Nine Months
Ended
September 30,
2008
$Accumulated from
August 17, 2006
(Date of inception)
to
September 30,
2009
$Revenue-----Operating Expenses---General and Administrative275,3771,683,087983,7292,698,10519,209,973Net Loss from Continuing Operations(275,377)(1,683,087)(983,729)(2,698,105)(19,209,973)Interest Income (Expense)(30,114)-(78,680)-(205,689)Other Income (Expense)-(1,302,244)-(1,459,522)-Impairment of Goodwill----(1,714,187)Loss on Disposal of Property and Equipment----(1,000)Net Loss before Discontinued Operations(305,491)(2,985,331)(1,062,409)(4,157,627)(21,130,849)Discontinued Operations (Note 10)-1,367-(53,327)(343,726)Net Loss and Comprehensive Loss for the Period(305,491)(2,983,964)(1,062,409)(4,210,954)(21,474,575)Net Loss Per Common ShareContinuing Operations  Basic and Diluted(0.00)(0.02)(0.00)(0.01)Discontinued Operations  Basic and Diluted(0.00)(0.01)(0.00)(0.01)Weighted Average Number of Common Shares Outstanding209,030,301181,765,000203,475,165163,514,000  (The accompanying notes are an integral part of these consolidated financial statements)  5   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Cash Flows (Expressed in Canadian Dollars) (unaudited) For the
Nine Months Ended
September 30,
2009
$For the
Nine Months
Ended
September 30,
2008
$Accumulated from
August 17, 2006
(Date of inception) to
September 30,
2009
$Operating ActivitiesNet loss for the period(1,062,409)(4,210,954)(21,474,575)Adjustments to reconcile net loss to net cash used in operating activities:Amortization--8,066Foreign exchange loss and other--15,410Stock issued for compensation and services212,6721,711,77814,943,739Loss on settlement of debt(17,777)1,459,522571,047Write-off of subscription receivable--770,310Imputed interest on shareholder loans78,684-205,693Depreciation expense10,38214,89948,731Impairment loss on goodwill--1,714,187Gain on cancellation of shares--(572,901)Changes in operating assets and liabilities:Taxes recoverable-3,219(1,011)Accounts receivable(7,638)2,011(16,985)Inventory-4,870-Prepaid expenses-116,447(1,104)Accounts payable and accrued liabilities243,121246,572648,178Net Cash Flows Used In Operating Activities(542,365)(651,636)(3,141,215)Investing ActivitiesCash acquired--2,194Purchase and construction of equipment-(74,550)(614,223)Net Cash Flows Used In Investing Activities-(74,550)(612,029)Financing ActivitiesProceeds from subscriptions and issuance of stock-357,2692,165,810Borrowings on debt523,086374,9532,060,938Principal payments on debt-(12,100)(464,049)Net Cash Flows Provided By Financing Activities523,086720,1223,762,699Decrease in Cash from Discontinued Operations--5,714Increase (Decrease) in Cash(19,279)(6,064)9,455Cash  Beginning of Period28,73418,211-Cash  End of Period9,45512,1479,455Supplementary DisclosuresInterest paid-Income taxes paid-Non-cash Investing and Financing ActivitiesShares issued for finders fee--1,188,001Shares issued to settle debt165,0001,883,4992,287,600  (The accompanying notes are an integral part of these consolidated financial statements)  6   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  1. Nature of Operations and Continuance of Business  Welwind Energy International Corporation (the Company) was incorporated in the State of Delaware on December 18, 1997 as Global Golf Holdings Inc. The Company acquired a business on November 23, 2004 to sell and distribute low carbohydrate and sugar-free foods through retail and wholesale outlets in Western British Columbia, Canada, and through the Internet. On August 17, 2006, the Company acquired all of the outstanding and issued share capital of Welwind Energy International Corporation (WEIC), a private Canadian company. WEIC was founded in 2005 to build, own and operate wind farms on an international scale. Accordingly, the Company is now involved with wind power projects in China. The Company is based in British Columbia, Canada. On November 24, 2007, the Company discontinued operations of the retail and wholesale foods division to focus specifically on the wind power projects in China.  The Company has not realized revenues on its wind power projects, has a working capital deficiency of $1,922,425 and has an accumulated deficit at September, 2009 of $21,474,575. The Company's ability to continue as a going concern is dependent upon the Company's ability to obtain additional financing and/or achieving a profitable level of operations. These factors raise substantial doubt regarding the Companys ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.  Management of the Company has undertaken a plan with the goal of sustaining the Companys operations for the next twelve months and beyond. These steps include: (a) becoming cash flow positive via the Companys Zhanjiang turbine and a Power Purchase Agreement from the local power authority, (b) continue efforts to raise significant additional capital and/or other forms of financing with Acterra Group and Adventis Capital; and (c) controlling overhead expenses. There can be no assurance that any of these efforts will be successful.  Recently Issued Accounting Pronouncements  In August 2009, the FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective for the Company on October 1, 2009. The Company does not expect the impact of its adoption to be material to its financial statements.  In October 2009, the FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect the timing or amount of revenue recognition. This standard, for which the Company is currently assessing the impact, will become effective for the Company on January 1, 2011.  In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the products essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard, for which the Company is currently assessing the impact, will become effective for the Company on January 1, 2011.   7   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  1. Nature of Operations and Continuance of Business, (contd)  Recently Adopted Accounting Pronouncements, (contd)  Effective June 30, 2009, the Company adopted a new accounting standard issued by the FASB related to the disclosure requirements of the fair value of the financial instruments. This standard expands the disclosure requirements of fair value (including the methods and significant assumptions used to estimate fair value) of certain financial instruments to interim period financial statements that were previously only required to be disclosed in financial statements for annual periods. In accordance with this standard, the disclosure requirements have been applied on a prospective basis and did not have a material impact on the Companys financial statements.  In June 2009, the Financial Accounting Standards Board ("FASB") established the FASB Accounting Standards Codification ( the "Codification") as the source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with GAAP. Rules and interpretive releases of the Securities and Exchange Commission ("SEC") under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The introduction of the Codification does not change GAAP and other than the manner in which new accounting guidance is referenced, the adoption of these changes had no impact on the our consolidated financial statements.  2. Summary of Significant Accounting Policies  a) Basis of Presentation  These interim consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in Canadian dollars. These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, WEIC, incorporated in the Province of Alberta, Canada. All significant intercompany balances and transactions have been eliminated. The Companys fiscal year-end is December 31.  b) Interim Consolidated Financial Statements  The interim unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (SEC) Form 10-Q. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with the Companys audited consolidated financial statements and notes thereto for the year ended December 31, 2008, included in the Companys Annual Report on Form 10-K filed on May 18, 2009 with the SEC.  The consolidated financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Companys consolidated financial position at September 30, 2009, and the consolidated results of its operations and consolidated cash flows for the three months ended September 30, 2009 and 2008. The results of operations for the three months ended September 30, 2009 are not necessarily indicative of the results to be expected for future quarters or the full year.  8   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  2. Summary of Significant Accounting Policies (contd)  c) Use of Estimates  The preparation of consolidated financial statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to goodwill and purchased intangible asset valuations, stock-based compensation expense, deferred income tax asset valuation allowance and loss contingencies. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. The actual results experienced by the Company may differ materially and adversely from the Companys estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.  d) Cash and Cash Equivalents  Cash consists of bank accounts held at financial institutions in the United States, Canada, and China. The Company considers all highly liquid instruments with a maturity of three months or less, at the time of issuance, to be cash equivalents.  e) Property and Equipment  Equipment is recorded at cost and is depreciated using the declining balance method over the estimated useful lives of the related asset. Maintenance and repairs are charged to expense as incurred. Significant renewals and betterments are capitalized. Costs included in wind equipment are under construction and will be amortized over their useful life on a straight-line basis once they are put into use.  f) Customer Relationships  Customer relationships consist of the relationships the Company has attained with the various levels of governments in China, which resulted in the entering of two agreements as noted in Note 8(a) and (b). The Company will amortize the carrying value of the customer relationships on a straight-line basis over the remaining estimated useful lives of the wind power plants upon commencement of the commercial production of electricity.  g) Revenue Recognition  The Company recognizes revenue in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 104 (SAB 104), Revenue Recognition in Financial Statements.  h) Long-Lived Assets  The Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could initiate a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life.  9   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  2. Summary of Significant Accounting Policies (contd)  Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.  i) Foreign Currency Translation  The Company's functional and reporting currency is the Canadian dollar. Monetary assets and liabilities denominated in foreign currencies are translated to Canadian dollars using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions are included in the determination of net income or loss. Foreign currency transactions are primarily undertaken in Chinese Renminbi. At September 30, 2009, the exchange rate for one Chinese Renminbi was $0.1570 CAD (2008 - $0.1548CAD). For the period from January 1, 2009 to September 30, 2009, the average exchange rate for one Chinese Renminbi was $0.1713 CAD (2008 - $0.1459 CAD). The Company has not, to the date of these consolidated financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.  j) Comprehensive Loss  As at September 30, 2009 and 2008, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the consolidated financial statements.  k) Basic and Diluted Net Income (Loss) Per Share  Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares since their effect is anti-dilutive.  l) Stock-based Compensation  The Company records stock-based compensation using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.  m) Financial Instruments and Concentrations of Business  The fair values of financial instruments including cash, accounts receivable, accounts payable, accrued liabilities and amounts due to related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. The Companys operations are in Canada and China resulting in exposure to market risks from changes in foreign currency rates. The financial risk is the risk to the Companys operations that arise from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.  10   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  2. Summary of Significant Accounting Policies (contd)  n) Discontinued Operations  Certain amounts have been reclassified to present the Companys discontinuance of its retail and wholesale foods division, as discontinued operations. Unless otherwise indicated, information presented in the notes to the financial statements relates only to the Companys continuing operations. Information relating to discontinued operations is included in Note 10.  o) Income Taxes  Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company is required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these consolidated financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.  p) Reclassifications  Certain reclassifications have been made to the prior periods consolidated financial statements to conform to the current periods presentation.  3. Prepaid Expense and Other Long-term Assets  September 30,
2009
$December 31,
2008
$Consulting--Other1,1041,104Total1,1041,104  As at September 30, 2009, the Company has non-current prepaid expenses of $nil (December 31, 2008 - $nil) relating to consulting costs as all amounts are fully vested at December 31, 2008.  11   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  4. Property and Equipment  Cost
$Accumulated
Depreciation
$September 30,
2009
Net Carrying
Value
$December 31,
2008
Net Carrying Value
$Wind equipment under construction521,037521,037521,037Automobile70,84343,17727,66635,700Computer hardware11,6518,6782,9734,755Office furniture and equipment11,7984,8176,9817,547615,32956,672558,657569,039  The wind equipment under construction relates to the Companys wind farm projects, as disclosed in Note 8. As the capital assets have not been placed in use, no depreciation of the wind equipment has been recorded for the three month period ended September 30, 2009.  As at September 30, 2009, the Company had equipment held for sale with a net carrying value of $1,858 (December 31, 2008 - $2,224) related to discontinued operations. Refer to Note 10.  5. Related Party Transactions/Balances  a) As at September 30, 2009, the balance due to related parties amounted to $1,230,593 (December 31, 2008 - $912,601), which includes $330,538 (December 31, 2008 - $233,438) owed to the former President of the Company for management fees and working capital purposes and $900,055 (December 31, 2008 - $679,163) owed to the Newly appointed President and spouse of the former President of the Company for working capital purposes. The amounts are unsecured, non-interest bearing, and due on demand.  b) As at September 30, 2009, the Company owes $351,296 (December 31, 2008 - $161,209) to shareholders for advances to the Company and expenses paid on behalf of the Company. Of this amount, $112,798 (December 31, 2008 - $112,798) is unsecured, bears interest at 10% per annum, and is due on demand. The remaining balance of $238,507 (December 31, 2008 - $48,404) is unsecured, non-interest bearing, and payable on demand.  6. Preferred Stock  On September 29, 2006, the Company entered into a Stock Purchase Agreement for a private placement consisting of 10,000,000 shares of preferred stock for cash proceeds of $556,855 (US$500,000) and 2,000,000 shares of common stock for cash proceeds of $111,371 (US$100,000). The Company also issued, to the investor, a 20% interest in its Zhanjiang wind far project described in Note 8(b). The preferred stock is convertible into common stock, on a one-for-one basis commencing August 17, 2007. As at September 30, 2009, there are 10,000,000 shares of preferred stock issued and outstanding.  12   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  7. Common Stock  a) On August 26, 2009, the Company issued 5,000,000 common shares of the Company with a total value of $98,802 based on the closing price of the Companys common stock on the date of issuance in relation to services rendered.  b) On June 16, 2009, the Company issued 5,000,000 common shares of the Company with a total value of $113,270 based on the closing price of the Companys common stock on the date of issuance in relation to services rendered.  c) On June 16, 2009, the Company cancelled 10,000,000 common shares of the Company with a total value of $226,540 based on the closing price of the Companys common stock on the date of cancellation.  d) On May 29, 2009, the Company issued 11,500,000 common shares of the Company with a total value of $252,103 based on the closing price of the Companys common stock on the date of issuance in relation to services rendered.  e) On February 4, 2009, the Company issued 1,582,855 common shares of the Company with a total value of $59,015 based on the closing price of the Companys common stock on the date of issuance in relation to settlement of debt in the amount of $15,000. The Company recorded a loss of $44,015.  f) On February 4, 2009, the Company issued 1,500,000 common shares of the Company with a total value of $55,926 based on the closing price of the Companys common stock on the date of issuance in relation to settlement of debt in the amount of $75,000. The Company recorded a gain of $19,074.  Stock Options  On June 23, 2006, the Company adopted a fixed stock option plan that provides for the issuance of incentive and non-qualified stock options to officers, directors, employees and consultants to acquire up to 15,000,000 shares of the Company's common stock. The Board of Directors determines the terms of the options granted, including the number of options granted, the exercise price and the vesting schedule. The stock option plan will expire December 31, 2016.  Effective February 4, 2008, the Company filed a Form S-8 Registration Statement in connection with its 2008 Equity Incentive Plan allowing for the direct award of stock or granting of stock options to directors, officers, employees and consultants to acquire up to a total of 20,000,000 shares of common stock. The Plan Administrator determines the terms of the options granted, including the number of options granted, the exercise price and the vesting schedule. At September 30, 2008, there are no stock options outstanding.  8. Commitments  a) The Company entered into an agreement dated January 18, 2006, with the Government of Yangxi City (Yangxi) for the development of a wind farm producing a total of 400,000 kilowatt (KW) per year of electrical power in the next ten years. Yangxi will assist the Company in securing land, sale price for the electricity, financing of the project, and preferential tax treatment. Initially, the Company will be required to prepare a community wind assessment and a feasibility study for approval. Yangxi can terminate the agreement if the project is not under construction within 24 months of signing the agreement. As at September 30, 2009, the Company has commenced construction on the plant and the agreement is in good standing.  b) The Company entered into an agreement dated March 21, 2006, with the Zhanjiang Foreign Trade & Economic Bureau (Zhanjiang) for the development of a wind power generation project in Zhanjiang City in the Guangdong Province. The project is expected to produce up to 600,000 KW of electrical power per year, with Phase 1 being 100,000 KW per year. The Company had six months from the date of the agreement to begin Phase 1 (commenced) or Zhanjiang had the right to terminate the agreement. The Company granted a 20% interest in this project to an investor. Refer to Note 6.  c) The Company rents, on a month-to-month basis, its industrial and office space for $1,726 per month, office space in China for approximately $1,000 per month and warehouse space for $1,791 per month.  13   Welwind Energy International Corporation (A Development Stage Company) Consolidated Statements of Operations (Expressed in Canadian Dollars) (unaudited)  9. Segmented Information  The Company operates as one operating segment which is wind power projects in China. The Chief Executive Officer is the Companys Chief Operating Decision Maker (CODM). The CODM allocates resources and assesses the performance of the Company based on the results of operations.  10. Discontinued Operations  On November 24, 2007, the Company discontinued all operations related to the former business of selling and distributing low carbohydrate and sugar-free foods.  The results of discontinued operations are summarized as follows:  Nine months
Ended
September 30, 2009Nine Months
Ended
September 30, 2008$$Revenue-3,054Cost of sales-(2,131)Gross Profit-923Operating Expenses:General and administrative-(54,250)Net Loss-(53,327)  As at September 30, 2009 and December 31, 2008, there were no remaining assets and liabilities of the discontinued retail and wholesale foods division.  11. Subsequent Events  Subsequent to September 30, 2009 the Company issued the following equity securities in exchange for services.  On October 26, 2009, the Registrant issued 2,000,000 shares of its restricted common stock as payment to a related party to settle outstanding debt. The shares were valued $0.012 per share, which represents the value of the services on the award date. 
 
On November 19, 2009 the Registrant issued 2,650,000 shares of its restricted common stock as payment to settle outstanding debt. The shares were valued at $0.01 per share, which represents the value of the debt on the award debt. 
 
On November 19, 2009 the Registrant issued 10,000,000 shares of its restricted common stock as payment to a related party to settle outstanding debt. The shares were valued at $0.01 per share, which represents the value of the debt on the award debt. 
 
On November 19, 2009 the Registrant issued 1,500,000 shares of its restricted common stock as payment to a law firm based in British Columbia for services. The shares were valued at $0.01 per share, which represents the value of the services on the award debt.   14   ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS  CAUTIONARY FORWARD - LOOKING STATEMENT  CERTAIN STATEMENTS IN THIS QUARTERLY REPORT ON FORM 10-Q (THIS "FORM 10-Q"), CONSTITUTE "FORWARD LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1934, AS AMENDED, AND THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 (COLLECTIVELY, THE "REFORM ACT"). CERTAIN, BUT NOT NECESSARILY ALL, OF SUCH FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY SUCH AS "BELIEVES", "EXPECTS", "MAY", "SHOULD", OR "ANTICIPATES", OR THE NEGATIVE THEREOF OR OTHER VARIATIONS THEREON OR COMPARABLE TERMINOLOGY, OR BY DISCUSSIONS OF STRATEGY THAT INVOLVE RISKS AND UNCERTAINTIES. SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF WELWIND ENERGY INTERNATIONAL CORP. ("WELWIND", "THE COMPANY", "WE", "US" OR "OUR") TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. REFERENCES IN THIS FORM 10-Q, UNLESS ANOTHER DATE IS STATED, ARE TO SEPTEMBER 30, 2009.  Overview  We see wind power becoming an efficient power source globally. Welwinds current projects focus is in the wind energy sector with future renewable energy applications under consideration. Renewable energy is power that comes from renewable resources such as the sun, wind and organic matter. These resources are constantly replenished by nature and are a cleaner source of energy. Welwinds goal is to add more renewable energy globally, resulting in cleaner air and a more stable energy supply for our future.  Welwind Energy International was founded to build, own and operate wind farms on an international scale. Our current project focus is to bridge the North America-China link by building wind farms in China. The Company will also work on extending its business plan into other markets including Canada and the United States.  Our Corporate History  The Company was incorporated on December 18, 1997, pursuant to the laws of the State of Delaware under the name of Autoeye Inc. On February 25, 2000, as part of an acquisition of The Forest Industry Online Inc., we changed our name to forestindustry.com, Inc. Prior to this acquisition, our Company was inactive. On October 25, 2002, we entered into a share exchange agreement with GolfLogix, Inc., a British Columbia, Canada Corporation (GolfLogix Canada) that was incorporated in February 2000, as West Coast Electric Vehicle Distributors, Inc. Under the terms of the Share Exchange Agreement, we acquired all of the outstanding shares of GolfLogix Canada in exchange for 2,500,000 shares of our common stock. As a result, GolfLogix Canada was a wholly owned subsidiary of our Company.  Prior to the acquisition of Golflogix Canada, our business activities included designing web sites and operating and maintaining a computer internet web site for companies associated with the forest and wood product industries. However, subsequent to the acquisition of this business we failed to generate profitability and incurred negative cash flows from operations. GolfLogix Canada, a distributor of golfing merchandise and has entered into an agreement to purchase a licensing right to market and distribute the GolfLogix System in Canada.  After our acquisition of GolfLogix Canada, on November 30, 2002, we entered into a stock purchase agreement with Cherry Point Consulting, resulting in a divestiture of the assets of Forest Industry Online. Under the agreement, Cherry Point Consulting purchased shares of Forest Industry Online and assumed all of the related assets and liabilities of the same. On January 7, 2003, we changed our name to Global Golf Holdings, Inc.  On April 15, 2004, the Company filed a Form 8-K announcing that due to lack of success in executing the Companys business plan and considerable under funding of the same, that the Board of Directors had determined that it was no longer viable to continue operations under the current business plan.  15   On November 23, 2004 the Registrant closed on the Agreement with Low Carb Centre and affiliates (hereinafter LCC). LCC is a privately held company organized under the laws of British Columbia, Canada with its primary business being the retail sales and distribution of gourmet low carbohydrate food products through its traditional brick-and-mortar retail stores and the World Wide Web at www.lowcarbcentre.com. The Low Carb Bakery (LCB) is a privately held company organized under the laws of British Columbia, Canada with its primary business being the manufacturing of food products for the LCC retail market. McNabb & Associates (MNA) is a privately held company organized under the laws of British Columbia, Canada with its primary business being the management and supervision of the business operations of both LCC and LCB.  Under the terms of the LCC Transaction, the Registrant acquired substantially all of the assets of LCC, including, but not limited to, LCCs suppliers, customer and vendor lists and records pertaining thereto, the trade names Low Carb Centre, Low Carb Bakery and McNabb and Associates, all registered and unregistered trademarks, service marks, sales marks, colors, names and slogans relating to the business, and all applications for any of the foregoing, together with all of the Sellers rights to use all of the foregoing forever, and all goodwill associated with the foregoing, the existing phone number(s) and websites of the business, all assets referred to or referenced within any audited financial statements of the business in preparation or consideration of the closing of the LCC Transaction and any and all recipes, trade secrets, trade practices, décor, goodwill, clients, equipment, furniture, assets, machinery, trade fixtures, miscellaneous supplies, inventory, existing contracts and tangible personal property.  Consideration for the LCC Transaction was 14,743,199 newly issued shares of the Registrant post-reverse split. The terms and conditions of the Agreement were determined in arms length negotiations between the Registrant and LCC.  The terms and conditions of the Asset Purchase Agreement were determined in arms length negotiations between the Company and LCC.  Since the LCC Transaction effectively constituted a reverse purchase with the management and shareholders of LCC essentially assuming the same positions in Vitasti, reverse purchase accounting principles were utilized by the Company in accounting for that transaction.  The Acquisition of Welwind Energy International Corporation (an Alberta, CanadaCcorporation).  On April 11, 2006, the Company and Welwind Energy International Corporation, a Corporation duly incorporated under the laws of the Province of Alberta, Canada, and the shareholders of Welwind Energy International Corporation (the Shareholders), entered into a Share Exchange Agreement (the "Agreement). The Agreement was closed on the 17th of August 2006. Per the Agreement, the Company acquired 100% of Welwind Energy International Corporation (WEIC) in exchange for 11,000,000 unregistered shares of Vitasti, which were distributed to the Shareholders as required by the terms of the Agreement. The Shareholders are subject to the resale provisions of Rule 144.  On October 26, 2006, the Company filed in the office of the Secretary of State for the State of Delaware a Certificate of Amendment to the Companys Certificate of Incorporation, causing the name of the Company to be changed from Vitasti, Inc. to Welwind Energy International Corp.  WEIC was founded in 2005 to build, own and operate wind farms on an international scale. Our current project is to bridge the North America-China link by building wind farms in China beginning along the South China Sea.  16   Organizational Structure  Our current organizational structure is summarized by the illustration below:  [welwind10q093009001.jpg]  Overview of our Business  The Company is engaged in the research, development and construction of wind farms, primarily involving small scale wind power. Our ultimate goal is to build small to medium scale wind farms of which our company has operating control. It is our goal to have our wind farm connected to the general utility electric grid to produce clean, environmentally-sound wind power for use by the electric power industry.  Our management has been involved in the wind power industry for more than 10 years. We have experience in the design, manufacture, maintenance and sale of wind turbines, as well as the full-scale development of wind farms. We hold contract rights, are involved with projects in development and under negotiation, and provide development activities in the wind power industry.  A wind farm is a group of wind turbines in the same location used for production of electric power. Individual turbines are interconnected with a medium voltage (usually 34.5 kV) power collection system and communications network. At a substation, this medium-voltage electrical current is increased in voltage with a transformer for connection to the high voltage transmission system. A large wind farm may consist of a few dozen to about 100 individual wind turbines, and cover an extended area of hundreds of square miles (square kilometers), but the land between the turbines may be used for agricultural or other purposes. A wind farm may be located off-shore to take advantage of strong winds blowing over the surface of an ocean or lake.  Since entering into the wind-power industry, we have been engaged primarily in the development of two projects, both located in the Guangdong Province in China.  Our two potential China projects would be considered small scale wind power wind farms, which is the name given to wind generation systems with the capacity to produce 50 kW or less of electrical power. Isolated communities, that otherwise rely on diesel generators, may use wind turbines to displace diesel fuel consumption. Individuals may purchase these systems to reduce or eliminate their dependence on grid electricity for economic or other reasons, or to reduce their carbon footprint. Wind turbines have been used for household electricity generation in conjunction with battery storage over many decades in remote areas. Increasingly, U.S. consumers are choosing to purchase grid-connected turbines in the 1 to 10 kilowatt range to power their whole homes. Household generator units of more than 1 kW are now functioning in several countries, and in every state in the U.S. Grid-connected wind turbines may use grid energy storage, displacing purchased energy with local production when available. Off-grid system users can either adapt to intermittent power or use batteries, photovoltaic or diesel systems to supplement the wind turbine. In urban locations, where it is difficult to obtain predictable or large amounts of wind energy (little is known about the actual wind resource of towns and cities), smaller systems may still be used to run low power equipment. Equipment such as parking meters or wireless Internet gateways may be powered by a wind turbine that charges a small battery, replacing the need for a connection to the power grid, making the potential carbon savings of small wind turbines difficult to determine.  Distributed generation from renewable resources is increasing as a consequence of the increased awareness of climate change. The electronic interfaces required to connect renewable generation units with the utility system can include additional functions such as active filtering to enhance the power quality.  17   What is Wind Power?  Wind power is the conversion of wind energy into a useful form, such as electricity, using wind turbines.  Wind energy has historically been used directly to propel sailing ships or converted into mechanical energy for pumping water or grinding grain, but the principal application of wind power today is the generation of electricity. Wind power, along with solar power, is non-dispatchable, meaning that for economic operation all of the available output must be taken when it is available, and other resources, such as hydroelectricity, must be used to match supply with demand.  What is a MET tower?  MET towers(Meteorological towers), are used to gather wind data necessary for site evaluation and development of wind energy projects.  [welwind10q093009002.jpg]  MET tower instrumentation data logs wind direction and speed. In addition the MET tower can be equipped to record temperature, solar radiation and air pressure if necessary.  The most reliable wind energy assessments depend on wind data recorded continually, over a 1 year period at 40 and 60 meter heights (or greater). The wind data is sampled periodically (every 10 minutes is typical) and stored locally at the tower base using solid-state memory devices. MET towers data loggers can be fitted with web server software and an internet connection for remote downloading of the meteorological information stored at the site.  MET tower installation costs typically range between $45,000 - $100,000 (tubular v. lattis) depending on site conditions and the necessity for site improvement, as well as the instrumentation and data logging strategies employed.  Market Overview  Demand for electricity has and will continue to increase as our society has become more technologically driven. Accordingly, the demand for more green energy solutions has also increased due to consumers desire to become environmentally conscious. Both trends are expected to continue. Significant new capacity for the generation of electricity will be required to meet anticipated demand.  Most of the worlds main energy sources are still based on the consumption of non-renewable resources such as petroleum, coal, natural gas and uranium. However, while still a small segment of the energy supply, renewable sources such as wind power are growing rapidly in market share. Wind power delivers multiple environmental benefits. Wind power operates without emitting any greenhouse gases and has one of the lowest greenhouse gas lifecycle emissions of any power technology. Wind power results in no harmful emissions, no extraction of fuel, no radioactive or hazardous wastes and no use of water to steam or cooling. Wind projects are developed over large areas, but their carbon footprint is light. Farmers, ranchers and most other landowners can continue their usual activities after wind turbines are installed on their property.  18   According to the U.S. Department of Energy, Energy Information Administrations publication Renewable Resources in the U.S. Electricity Supply, wind power generation is projected to increase at a rate of 10.4% per year. Annual growth in the wind power industry for the past ten years has exceeded 28% per year according to the Global Wind Energy Council. Although wind power produces under 1% of electricity worldwide according to the Global Wind Energy Councils Global Wind 2007 Report, it is a leading renewable energy source and accounts for 19% of electricity production in Denmark (according to the U.S. Department of Energys Energy Facts web page), 10% in Spain and 7% in Germany (according to the Global Wind Energy Councils Europe region web page).  According to the Global Wind Energy Councils Global Wind 2007 Report, the United States led the world in wind power installations in 2007 and global wind capacity increased by more than 20,000 megawatts, with 5,244 megawatts installed in the United States alone. Spain and China were the second and third largest wind power growth countries in 2007 with 3,522 megawatts and 3,304 megawatts of wind power capacity added, respectively, according to the report.  Wind power can deliver zero-emissions electricity in large amounts. Wind projects do not use any fuel for their operations, so the price of wind power does not vary when fuel prices increase. When utilities acquire wind power, they lock in electricity at a stable price for, on average, 20 years or more.  Wind, however, is intermittent and electricity generated from wind power can be highly variable. Good site selection and advantageous positioning of turbines on a selected site are critical to the economic production of electricity by wind energy. In our experience, the primary cost of producing wind-powered electricity is the construction cost; wind energy has no fuel costs and relative low maintenance costs.  Though we have largely focused on the development of wind projects in China we are continually evaluating potential wind farm sites to produce wind energy in the United States and Canada.  Growth in Demand for Wind Power  Growth in wind power is being driven by several environmental, socio-economic and energy policy factors that include:  · ongoing increases in electricity demand due to population growth and growth in energy consuming devices such as computers, televisions and air conditioning systems, · the increasing cost of the predominant fuels required to drive the existing fleet of conventional electric generation such as coal, natural gas, nuclear and oil, · the increasing cost and difficulty faced in the construction of conventional electric generation plants, · existing and growing legislative and regulatory mandates for cleaner forms of electric generation, · ongoing improvements to wind power systems making them more cost effective and improving availability to meet demand, and · worldwide concern over greenhouse gas emissions and calls to reduce global warming due to the carbon dioxide produced by conventional electric generation.  CHINA AS A DEVELOPMENT RICH OPPORTUNITY  Chinas abundant inland and offshore wind energy resources provide potential for large-capacity, in-grid wind farms. By the end of 2005, China had built 59 wind farms with 1,854 wind turbine generators and a 1,266 megawatt in-grid wind power installed capacity, ranking it number ten globally.  19    CHINAS WIND POWER POTENTIAL[welwind10q093009004.gif]green=great, pink=good, blue=ok, yellow=poor
(offshore & coastal potential not shown)  Today, wind power in China is developing rapidly and receives particularly strong government support. The new Renewable Energy Law and its detailed incentive policies reflect the Chinese governments intention to build up this industry. By 2020, China plans to have 30 gigawatts of wind power.  European companies dominate Chinas wind power equipment market. Among U.S. companies, only GE Wind Power is active in China. In 2005, GE Wind Power occupied 3% of the in-grid wind turbine market in China.  According to the China Academy of Meteorological Sciences, the country possesses a total 235 gigawatts of practical onshore wind power potential that can be utilized at 10 meters above the ground. Annual potential production from wind power could reach 632.5 gigawatts if the annual, full-load operation reaches 2,000-2,500 hours. A detailed survey is needed, however, for economically utilizable wind power resources. The potential for offshore wind power is even greater, estimated at 750 gigawatts. Offshore wind speed is higher and more stable than onshore wind, and offshore wind farm sites are closer to the major electricity load centers in eastern China. Areas rich in wind power resources are mainly concentrated in two areas: northern Chinas grasslands and Gobi desert, stretching from Inner Mongolia, Gansu, and Xinjiang provinces; and in the east coast from Shangdong and Liaoning and the Southeast Coast in Fujian and Guangdong provinces.  In 1986, China built its first wind farm in Rongcheng, Shandong Province. From 1996 to 1999, in-grid wind power developed very quickly, entering a localization stage. By the end of 2004, there were 43 wind farms with 1291 wind turbines in China, with 764 megawatts of installed capacity. Liaoning, Xinjiang, Inner Mongolia, and Guangdong experienced the fastest wind power development, representing 60% of the installed power generating capacity of national wind power. Currently, Xinjiangs Dabancheng is the largest wind farm in China, with 100 megawatts of installed power generating capacity. Most generators range from 500 kilowatts to 1 megawatt, accounting for 84% of Chinas wind turbine generators.  Regulations and Economic Incentive Plans Implemented by Chinese Government for Renewable Energy Projects  To support the development of wind power technology and growth of the in-grid wind power market, the Chinese government has recently pushed hard on renewables, and it implemented a series of projects and also stipulated a series of economic incentive policies:  20    Ride the Wind Program  [welwind10q093009006.gif]Windmills, while still subsidized, are
economically viable in high-wind areas
(photo: Nordex 2.5 MW units)  To import technology from foreign companies and to establish a high-quality Chinese wind turbine generator sector, the former State Development and Planning Commission (SDPC) initiated the Ride the Wind Program in 1996. This initiative led to two joint ventures, NORDEX (Germany) and MADE (Spain). These JVs effectively introduced 600kilowatts wind turbine generator manufacturing technology of 600 kilowatts into China.   National Debt Wind Power Program  To encourage the development of domestic wind power equipment manufacturing, the former State Economic & Trade Commission (SETC) implemented the National Debt Wind Power Program. This program required the purchase of qualified, locally-made wind power components for new generation projects. Chinas government provided bank loans with subsidized interest to wind farm owners of as compensation for the risk of using locally-made wind turbine generators. These loans funded construction of demonstration project wind farms with a total installed capacity of 8megawatts. This program has been completed.   Wind Power Concession Project  The National Development and Reform Commission (NDRC) initiated the Wind Power Concession Project in 2004 with a 20-year operational period. This program aims to reduce the in-grid wind power tariff by building large capacity wind farms and achieving economies of scale. Each of the wind farms built in this program must reach a 100 megawatts capacity. By 2006, NDRC had approved 5 wind farms, in Jiangsu, Guangdong, Inner Mongolia, and Jilin Province.  In any typical wind power concession, the power grid company signs a long-term power purchase agreement with the wind power project investor and agrees to purchase electricity generated by the project. The bidding competition determines in-grid tariff and the agreement clearly prescribes the quantity of in-grid wind power to be purchased. The duration of the agreement covers the total operation period of the wind project.  Therefore, the investor minimizes risk in recovering investment costs. The concession agreement between the government and project investor provides dequate assurance that the project will be granted a power-purchase agreement. All end-users of the grids electricity share the tariff increase due to wind power purchase. As incentives, the government waves import customs tariff and VAT on the equipment and accessories.  Although Chinas government has, for many years, encouraged the use of wind power, favorable conditions for wide-scale development have yet to develop. Through the wind power concession project, the Chinese government hopes to create further incentives for companies to develop this renewable energy resource. The concession agreement and long-term power purchase agreement protect the interests of wind power investors, encouraging large companies, especially foreign ones, to invest in the Chinese wind power sector. Under this policy, market risk is reduced significantly, which in turn reduces the risk premium of the internal rate of return for wind power projects. Eventually, the wind tariff shared by end-users will be cut due to this decreased risk.  The Chinese government has expanded the capacity of wind farms to a 100 megawatt level, and has created new wind power tariffs based on the market mechanism and tendering process. This has attracted a number of Chinese companies into this program. Through successful implementation of the project, the Chinese government hopes to make wind power an economically-viable power choice, effectively competing with conventional power sources in China.  21    [welwind10q093009007.jpg]  China encourages the development of wind power in its National Middle and Large Term Development Plan. According to the plan, by 2010, Chinas installed capacity of wind power will reach 5 gigawatts. By 2020, it will achieve 30 gigawatts. In order to achieve this level of growth, China needs to build 800 megawatts of new wind power capacity each year from 2006 to 2010.  In February 2005, Chinas Renewable Energy Law was formulated and was put into effect on January 1, 2006. The law stipulates that the power grid company must sign a grid connection agreement with the wind power generating company and purchase the full amount of the wind power generated by it. The wind power tariff will be determined by the wind farm project tendering. The winners quoted tariff will be the tariff of that wind farm project.  Wind power is a priority National Clean Development Mechanism Project, i.e., wind farm developers can sell Certified Emission Reduction Certificates (CERs) to developed countries under the terms of the Kyoto Protocol.  The Chinese government reduced the Value-added Tax (VAT) for wind power from 17% to 8.5% in 2001 and adjusted the import custom tariff of wind turbine generator sets to 8% and that of its components to 3% in 2004. The import duty of wind power equipment and accessories can be waived if it is for the wind farm developers own use.  Some local governments in Guangdong, Jilin, Xinjiang and Inner Mongolia formulated their own incentive policies to develop wind power. By the end of 2005, Chinas wind power installed capacity was about 1gigawatts. According to NDRCs planning, Chinas wind power installed capacity will reach 5gigawatts by 2010 and 30-40 gigawatts by 2020. According to statistics, the cost of wind power is 33%-60% higher than that of coal, which makes the wind power tariff 68%-94% higher than the coal tariff. Industry expert predicts that the wind power can be commercially viable and compete with clean coal-fired power economically by 2020.  [welwind10q093009008.jpg]   22   On any listing of the very best prospects for China-focused wind sector business development, these would be amongst the top priorities:  -Large capacity wind turbine generators, especially at the 1megawatts level and above. -Design and operation technology of large-scale wind farms.  Development trends for single wind turbine generators favor large capacity sets, especially at the 1 megawatt level. Before 1997, the 1 megawatt-level wind turbine generators occupied less than 10% of the worldwide market share. In 2001, that figure had risen to 52.3% and reached 62.1% in 2002. Although China has the ability to manufacture wind turbine generators below the 750 kilowatt level, production of higher capacity generators remains a challenge.  Although China has made a prototype of a 1.2 megawatt level wind turbine, it has only been used for demonstration projects. International suppliers will find strong demand in China for wind turbine generators at 1 megawatt and above levels. Beyond the manufacturing sector, Chinese companies also lack experience for investment, design, and operation of large wind farms.  With the recent passage of China's new Renewable Energy Law, one of the world's largest economies has now made one of the largest state-sponsored commitments toward renewable energy. China's government imposed a national renewable energy requirement that is expected to boost the use of renewable energy capacity up to 10 percent by the year 2020.  The law requires power grid operators to purchase resources from registered renewable energy producers. The law also offers financial incentives, such as a national fund to foster renewable energy development, and discounted lending and tax preferences for renewable energy projects.  Rapid economic development throughout China has resulted in a significant increase in energy consumption, leading to a rise in harmful emissions and power shortages. The Renewable Energy Law is designed to help protect the environment, prevent energy shortages, and reduce dependence on imported energy.  China's new laws set the stage for the widespread development of renewables, particularly for commercial scale renewable generating facilities. Through this legislation, the State officially encourages the construction of renewable energy power facilities. China's electricity grid is obligated to purchase all the electricity generated by approved renewable energy facilities located in its service area. The grid's buying price for renewables will be set by the National Development and Reform Commission (NDRC), a regulatory department of the State Council. NDRC will adjust the buying price from time to time as necessary. The cost of purchasing this power will be spread across all customers on the grid.  NDRC will also implement a national renewable energy plan, including specific renewable energy targets that will act as the framework for implementation of the law. Provincial planning agencies will then develop their more specific implementation plans. The law includes other details related to the purchase and use of solar photovoltaics (PV) and solar water heating as well as renewable energy fuels. Finally, the law includes specific penalties for non-compliance with the law.  Our Wind Farm Portfolio  We have been involved with two (2) wind projects in Chinas Guangdong Province. The following provides an overview of the two projects, including current status:  Project NameMegawattsPhaseZhanjiang Project49 - 400Local Approvals Secured, Pending Construction Permit and Possible Site RelocationYangxi Project49 -400Development Agreement with City of Yangxi signed in June 2007, Wind Testing Completed, Project Proposal & Feasibility Report along with the Grid Connection Report Anticipated by end of Q4 2009 for Submission to City of Yangxi  Our plan has been based on the Company developing a 49Mw per project per year upon the commencement of construction (subject to securing necessary approvals), which is the maximum allowed by the provincial government.  23   The Zhanjiang Project  The Zhanjiang Windcor Windfarm Ltd. (ZWWL) began operations in 2006. The ZWWL was acquired by the Company as part of the acquisition of Welwind (the Alberta corporation) in August 2006. The ZWWL is the through which all operations pertaining to the Zhanjiang Project would be handled. The ZWWL commenced initial operations in April 2006, with such operations including establishment of an office location. The ZWWL project is proposed located on Donghai Island.  A MET tower was installed and began collecting wind data in June 2006. The data collected was processed in accordance with strict industry standard procedures and correlating data from the 80 meter meteorological tower on site has ensured accurate compilation of atmospheric conditions during the testing period.  Installation of a 750 KW test turbine was completed in May 2007. ENGAA, the turbine manufacturer, immediately commenced monitoring the data from this first turbine. By July 2007, ENGAA had completed its commissioning stage of the Zhanjiang Turbine and had begun to assess and analyze the data from that turbine.  A Project Feasibility Study Report and Grid Connection Report were finalized in November 2007 by the Guangdong Electric Power Design Institute, and subsequently submitted to the Guangdong Power Grid Corporation for review in anticipation of finalizing a Power Connection Agreement (PCA).  Based on the completed Project Feasibility Study Report and Grid Connection Report, we executed the PCA with the local utility company, the Guangdong Power Grid Corporation, in November 2007. The local utilitys buying price with respect to each local energy producer is set by the National Development & Reform Commission (NDRC) upon issuance of the Construction Permit by the Guangdong Provincial Government as such buying price, though set by law, is subject to change.  All testing, reports, and other necessary documentation, including all approvals required, were submitted to the City of Zhanjiang for ratification of the Project Feasibility Study Report in June 2008. In early December 2008, the City of Zhanjiang approved the ZWWL Project Feasibility Study Report, a pre-requisite for submission to the Guangdong Provincial Government for the Construction Permit. Based on the Companys Project Proposal and Feasability Report, the Company received a conditional land use permit, subject to the issuance and approval of the construction permit by the Guangdong Provincial Government, for the construction of a wind farm on Zhanjiang, Donghai Island.  Immediately thereafter, the ZWWL submitted the City of Zhanjiang approved Project Feasibility Study Report to the Guangdong Provincial Government for issuance of the Construction Permit. After corresponding with the Guangdong Provincial Government in January and February 2009, the ZWWL was advised in March 2009 that the Federal Government of China had given preference to a major steel project on Donghai Island. As a result of this major steel project, the Guangdong Provincial Government was reassessing the location of all other projects in the area. By way of correspondence received in March 2009, the Guangdong Provincial Government asked the Company to relocate the site for its proposed wind farm to another location as all available lands on Donghai Island were being reserved for the steel project until further notice, with such steel project including an accompanying town of an estimated 100,000 people.  Since such time ZWWL has been working with the Guangdong Provincial Government to secure a feasible alternate site, and it is expected that the Guangdong Provincial Government will begin to designate approved alternate sites for the other local projects, including the ZWWL wind farm project We initially anticipated that this process would occur in June of 2009, however, as of the date of this Report we are still attempting to find a suitable solution that is beneficial for the Company and the Guangdong Provincial Government. .  The Yangxi Project  The Yangxi Windfarm, the subsidiary through which all operations pertaining to the Yangxi Project are handled, commenced operations in July 2006.  The installation of an 80 foot meteorological tower was completed in July 2006. At that time, we began to collect data necessary to provide the information required to build out the wind farm. Phase 1 of the Yangxi wind farm will consist of a 49 MW project. We anticipate that the Yangxi project will consist of a total of 400 MWs once fully completed.  In January 2008, after 16 months of collecting data from the tower at the Yangxi location, a formal Project Proposal was submitted to the City of Yangxi Government as well as to the Guangdong Tianlian Engineering Ltd., the Company which is actively engaged in preparing the Project Feasibility Study Report, which includes the Grid Connection Report. In May 2008, the Company opened its Yangxi office.  24   In December of 2008, we submitted a process report/update to the City of Yangxi Government. This process report provided detailed information about our plans to build the wind farm. On December 24, 2008, we received a letter of support for our project from the City of Yangxi Government.  We anticipate that the Project Feasibility Study Report and Grid Connection Report will be available by the end of December 2009, at which time we anticipate continuing the process of attempting to secure the necessary approvals to move forward.  Supply  The Company and YATU Wind Energy Manufacturing Co. Ltd., formerly known as Guangzhou Engga Wind Energy Co. Ltd. (ENGGA), have a cooperative relationship where by the Company and ENGGA will work together on the technology and future supply of all Welwind turbines. The agreement gives Welwind priority for all turbines to be manufactured by ENGGA. ENGGA is the sino-joint enterprise with the shareholders by Britain ENGGA Power Generator Co., Ltd. and Hong Kong ENGGA Investment Co., Ltd. with the registered capital reaching RMB30 million and specializing in making, selling and installing wind power generation equipments, as well as selling parts of wind power generation equipments.  Competition  Large utility companies dominate the energy production industry and coal continues to dominate as the primary resource for electricity production. Electricity generated from wind energy faces competition from other traditional resources such as nuclear, oil and natural gas. The advantages of conventional production of electricity are that:  · the technology and infrastructure already exist for the use of fossil fuels such as coal, oil and natural gas, · commonly-used fossil fuels in liquid form such as light crude oil, gasoline and liquefied petroleum gas are easy to distribute, and · petroleum energy density (an important element in land and air transportation fuel tanks) in terms of volume (cubic space) and mass (weight) is superior to some alternative energy sources.  However, energy produced by conventional resources also faces a number of challenges including:  · the inefficient atmospheric combustion (burning) of fossil fuels leads to the release of pollution into the atmosphere including carbon dioxide which is largely considered the primary cause of global warming, · dependence on fossil fuels from volatile regions or countries of the world creates energy security risks for dependent countries, · fossil fuels are non-renewable unsustainable resources which will eventually decline in production and become exhausted with potentially dire consequences to societies that remain highly dependent on them, and · extraction of fossil fuels is becoming more expensive and more dangerous as readily-available resources are exhausted and mines get deeper and oil rigs must drill deeper and further out in oceans.  In contrast, electricity generated from wind energy:  · produces no water or air pollution that can contaminate the environment because there are no chemical processes involved in wind power generation; therefore, there are no waste by-products such as carbon dioxide, · does not contribute to global warming because it does not generate greenhouse gases, · is a renewable source of energy, and · in the case of community wind power, farming and grazing can still take place on land occupied by wind turbines.  However, wind energy producers also face certain obstacles including:  · the reality that wind is unpredictable and, therefore, wind power is not predictably available, and when the wind speed decreases, less electricity is generated, · residents in communities where wind farms exist may consider them an eyesore, and · wind farms, depending on the location and type of turbine, may negatively affect bird migration patterns and may pose a danger to the birds themselves; however, newer, larger wind turbines have slower moving blades which seem to be visible to most birds.  We expect that primary competition for the wind power industry will continue to come from utility company producers of electricity generated from coal and other non-renewable energy sources.  25   New entrants in the wind power development market, however, face certain barriers to entry. The capital costs of buying and maintaining turbines are high. Other significant factors include the cost of land acquisition, the availability of transmission lines, land use considerations and the environmental impact of construction and operations. Finally, another critical barrier to entry into the wind power development business is the necessary experience required to bring project to the point where they are able to secure interconnection agreements, power purchase agreements and project financing for construction.  Wind Energy Industry Participants  As wind energy technology gains wider acceptance, competition may increase as large, well-capitalized companies enter the business. As previously stated, wind energy is the fastest growing source of energy worldwide for three consecutive years. Energy companies such as British Petroleum, Shell Oil Companys Wind Energy arm, Siemens and other major companies in the energy sector, see opportunities in wind power development. Additionally, there are many smaller companies that are seeking out opportunities in the wind energy sector.  In some cases, competitors may have longer operating histories, more customers, greater financial strength, more name recognition, and larger technical staffs. These competitors may be able to more readily identify and acquire suitable locations to exploit the growth in the wind energy sector more easily because of their financial resources and awareness in the market. Our larger competitors can also devote substantially more resources to business development and may adopt more aggressive pricing policies.  Our Competitive Advantages  We believe that our experience in developing wind farm projects in new market areas will enable us to continue to successfully implement our business plan. Further, we believe our managements understanding of deregulated energy markets enables us to maximize the value of our development portfolio. Our team has experience in site selection, market analysis, land acquisition, community relations, permitting, financing, regulation and construction.  As a result of our project portfolio and management team, we enjoy strong relationships with key trading partners that are required for successful wind farm development. These relationships include regulators, turbine suppliers, electric component suppliers, equity investors, project lenders, engineering firms, constructors, electric transmission operators and electric utilities.  Intellectual Property  We depend on our ability to develop and maintain the proprietary aspects of our technology to distinguish our products from our competitors products. To protect our proprietary technology, we rely primarily on a combination of confidentiality procedures. It is our policy to require employees and consultants to execute confidentiality agreements and invention assignment agreements upon the commencement of their relationship with us. These agreements provide that confidential information developed or made known during the course of a relationship with us must be kept confidential and not disclosed to third parties except in specific circumstances and for the assignment to us of intellectual property rights developed within the scope of the employment relationship.  Governmental Regulation  We do not use, generate or discharge toxic, volatile or otherwise hazardous chemicals and wastes in our research and development and manufacturing activities. However, we are subject to a variety of foreign, federal, state and local governmental regulations. At this time, we believe that we have all permits necessary to conduct our business.  We are not aware of any environmental investigation, proceeding or action by foreign, federal or state agencies involving our current facilities or operations. If we fail to comply with present or future environmental regulations, we could be subject to fines, suspension of production or a cessation of operations. Any failure by us to adequately comply with existing and future regulations could subject us to financial liabilities, operational interruptions and adverse publicity, any of which could materially and adversely affect our business, results of operations and financial condition.   Employees  As of September 30, 2009, we employed 7 full-time employees. None of our employees is subject to a collective bargaining agreement and we believe that relations with our employees are very good. We also frequently use third party consultants to assist in the completion of various projects. Third parties are instrumental to keep the development of projects on time and on budget.  26   Change in Reporting Currency  Effective January 1, 2005, the Company changed its reporting currency from the U.S. dollar to the Canadian dollar. The reason for this change was because a majority of the Companys assets and operations are located in Canada. All amounts set forth in this filing are in Canadian Dollars, unless otherwise indicated.   Available Information  We file electronically with the Securities and Exchange Commission our annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934. You may obtain a free copy of our reports and amendments to those reports on the day of filing with the SEC by going to http://www.sec.gov.  Results of Operations  For the
Three Months
Ended
September 30,
2009
$Change from
Prior Period
%For the
Three Months
Ended
September 30,
2008
$Change from
Prior Period
%Operating Expenses305,491(21.89)1,683,087215.09Net Loss from Continuing Operations(305,491)(21.89)(1,683,087)215.09Other Income (Expense)--(1,302,244)1146.46Net Loss before Discontinued Operations(305,491)(2189)(2,985,331)367.45Discontinued Operations--1,36718.53Net Loss for the Year(305,491)(21.89)(2,983,964)368.47  General and Administrative Expenses  During the three month period ended September 30, 2009, the Company incurred general and administrative expenses of $305,491compared to $1,683,087 in the same period in the previous year, this is a decrease of 81.8% or $1,377,596.  Net Loss  During the period ended September 30, 2009, the Company incurred a net loss of $305,491 compared to a net loss of $2,985,331 in the same period in the previous year. The 89.8% decrease of $2,679,840 in net loss was mainly attributable to a decrease in the loss on the settlement of debt of $1,302,244.  As at September 30, 2009, the Company had $9,455 in cash, total current assets of $35,184, and current liabilities of $1,957,609. The Company may require additional capital investments or borrowed funds to meet cash flow projections and carry forward our future business objectives. There can be no assurance that the Company will be able to raise capital from outside sources in sufficient amounts to fund the business.  The failure to secure adequate outside funding would have an adverse affect on our expansion plan of operation and results there from and a corresponding negative impact on shareholder liquidity.  During the period ended September 30, 2009, the Company used $542,365of net cash flows in operating activities.  Uses of Liquidity  The Company's cash requirements through the end of fiscal 2009 are primarily to fund operations and to complete the wind farm projects in China.  Sources of Liquidity  The Companys primary source of liquidity for its short-term cash needs is expected to be from cash and cash equivalents currently on hand. The Company believes that will be able to borrow additional funds if needed.  27   Cash Requirements  Our cash on hand as of September 30, 2009 is $9,455. We have sufficient cash on hand to pay the costs of some of our operations as projected to twelve (12) months or less and to fund our operations for that same period of time. However, we will require additional financing in order to proceed with some or all of our goals as projected over the next twelve (12) months. We presently do not have any arrangements for potential lines of credit or sources of financing for the purpose of proceeding with any of our goals projected over the next twelve (12) months and beyond.  Any additional growth of the Company may require additional cash infusions. We may face expenses or other circumstances such that we will have additional financing requirements. In such event, the amount of additional capital we may need to raise will depend on a number of factors. These factors primarily include the extent of operating expenses, research and development expenses, and capital expenditures. Given the number of programs that we have ongoing and not complete, it is not possible to predict the extent or cost of these additional financing requirements.  Notwithstanding the numerous factors that our cash requirements depend on, and the uncertainties associated with each of the major revenue opportunities that we have, we believe that our plan of operation can build long-term value if we are able to demonstrate clear progress toward our objectives.  Progress in the development of our business plan will likely lend credibility to our plan to maintain profitability. We hired several members to our sales, marketing, research and development, regulatory and administrative staff during the course of 2007 in order to fully implement our plans for growth.  The Company does not anticipate any contingency upon which it would voluntarily cease filing reports with the SEC, even though it may cease to be required to do so. It is in the compelling interest of this Registrant to report its affairs quarterly, annually and currently, as the case may be, generally to provide accessible public information to interested parties, and also specifically to maintain its eligibility for the OTCBB.  The failure to secure any necessary outside funding would have an adverse affect on our development and results there from and a corresponding negative impact on shareholder liquidity.  Our plan of operation calls for significant expenses in connection with the implementation of our business plan over the course of the next 24 months. For the next twelve months, management anticipates that the minimum cash requirements to fund our proposed goals and our continued operations will be at least $500,000. As such, we do not have sufficient funds on hand to meet our planned expenditures over the next 24 months. Therefore, we may require and may need to seek additional financing to meet our planned expenditures.  Obtaining additional financing would be subject to a number of factors, including development of our business plan and interest in our company. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us. Since our inception, we have relied on our revenues to fund our operations and have used our common stock to raise money for our operations as well.  Off-Balance Sheet Arrangements  We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our investors.  Critical Accounting Policies  The preparation of financial statements in conformity with generally accepted accounting principles requires management to make a wide variety of estimates and assumptions that affect (i) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and (ii) the reported amounts of revenues and expenses during the reporting periods covered by the financial statements. Our management routinely makes judgments and estimates about the effect of matters that are inherently uncertain. As the number of variables and assumptions affecting the future resolution of the uncertainties increases, these judgments become even more subjective and complex. The most significant accounting policies that are most important to the portrayal of our current financial condition and results of operations are as follows:  Revenue Recognition  The Company recognizes revenue in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 104 (SAB 104), Revenue Recognition in Financial Statements.  28   RECENT ACCOUNTING PRONOUNCEMENTS  Effective June 30, 2009, the Company adopted a new accounting standard issued by the FASB related to the disclosure requirements of the fair value of the financial instruments. This standard expands the disclosure requirements of fair value (including the methods and significant assumptions used to estimate fair value) of certain financial instruments to interim period financial statements that were previously only required to be disclosed in financial statements for annual periods. In accordance with this standard, the disclosure requirements have been applied on a prospective basis and did not have a material impact on the Companys financial statements.  In June 2009, the Financial Accounting Standards Board ("FASB") established the FASB Accounting Standards Codification ( the "Codification") as the source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with GAAP. Rules and interpretive releases of the Securities and Exchange Commission ("SEC") under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The introduction of the Codification does not change GAAP and other than the manner in which new accounting guidance is referenced, the adoption of these changes had no impact on the our consolidated financial statements.  Recently Issued Accounting Standards  In August 2009, the FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective for the Company on October 1, 2009. The Company does not expect the impact of its adoption to be material to its financial statements.  In October 2009, the FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect the timing or amount of revenue recognition. This standard, for which the Company is currently assessing the impact, will become effective for the Company on January 1, 2011.  In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the products essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard, for which the Company is currently assessing the impact, will become effective for the Company on January 1, 2011.  ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.  ITEM 4. CONTROLS AND PROCEDURES  Evaluation of Disclosure Controls and Procedures.  As required by Rule 13a-15 under the Exchange Act, our management, including Tammy-Lynn McNabb, our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2008, and updated the disclosure for the period ended September 30, 2009.  29   Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating and implementing possible controls and procedures.  Management conducted its evaluation of disclosure controls and procedures under the supervision of our chief executive officer and our chief financial officer. Based on that evaluation, Ms. McNabb concluded that because of the material weaknesses in internal control over financial reporting described below, our disclosure controls and procedures were not effective as of June 30, 2009 and December 31, 2008.  Managements Report on Internal Control over Financial Reporting  Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2008, and reviewed our internal controls over financial reporting for the period ended September 30, 2009 using the criteria established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).  A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Companys annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of September 30, 2009 and December 31, 2008, the Company determined that there were control deficiencies that constituted material weaknesses, as described below:  1. As of September 30, 2009, effective controls over the control environment were not maintained. Specifically, a formally adopted written code of business conduct and ethics that governs to the Companys employees, officers and directors was not in place. Additionally, management has not developed and effectively communicated to its employees its accounting policies and procedures. However, the Companys financial reporting process is centralized around the Companys Chief Executive Officer and an external consulting firm responsible for the Companys financial reporting and policies surrounding the day-to-day transactions of the Companys financial reporting and record-keeping in Canada and China have been implemented and reviewed by management with no material errors during the year ended December 31, 2008. The Company is currently evaluating its internal controls over the control environment.  The Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-B. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.  2. As of September 30, 2009, effective controls over financial statement disclosure were not maintained. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness. The Company continues to engage a third-party financial statement provider to prepare the required annual and quarterly financial statements to assist in the Companys filing requirements.  3. As of September 30, 2009, effective controls over equity transactions were not maintained. Specifically, controls were not designed and in place to ensure that equity transactions were properly reflected. Accordingly, management has determined that this control deficiency constitutes a material weakness. The Company, through its financial statement provider, are ensuring that equity transactions in fiscal 2009 are being recorded promptly and that appropriate valuation of the common shares are recorded for financial reporting purposes.  Accordingly, the Company concluded that these control deficiencies resulted in a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the companys internal controls.   As a result of the material weaknesses described above, management has concluded that the Company did not maintain effective internal control over financial reporting as of September 30, 2009 based on criteria established in Internal ControlIntegrated Framework issued by COSO.  30   Continuing Remediation Efforts to address deficiencies in Companys Internal Control over Financial Reporting  Our management and Board of Directors plan to establish the following remediation measures during the fiscal year ending December 31, 2009:  1. Our Board of Directors will nominate an audit committee and audit committee financial expert to ensure that we establish appropriate internal controls over our financial reporting process, including formal review and approval of our financial statements and the review, implementation, and monitoring of necessary internal controls, procedures, and policies to mitigate the potential risk of material misstatement of our financial records.  2. Our management and Board of Directors are currently finalizing a formal code of ethics that will outline the policies and procedures regarding management, directors, and employees of the Company as well as formalize existing policies and procedures surrounding the Companys financial reporting requirements.  Changes in Internal Controls  There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2009 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  PART II - OTHER INFORMATION.  ITEM 1. LEGAL PROCEEDINGS.  From time to time, we are involved in routine legal matters incidental to our business. In the opinion of management, the ultimate resolution of such matters will not have a material adverse effect on our financial position, results of operations or liquidity.  Consistent with Item 103 of Regulation S-K, we are presently involved in the following material pending legal proceedings not incidental to the business of the Company:  On August 14, 2009, Chong Jian Zhao filed a suit in the Supreme Court of British Columbia naming the Registrant as the sole defendant. Mr. Zhao alleges that he is entitled to certain shares of the Registrant's common stock for services rendered. The Registrant disputes Mr. Zhao's claims. Mr. Zhao is seeking for specific performance as to the shares he claims that he is owed.  On September 22, 2009, Manning Elliott LLP ("ME") filed a suit in the Supreme Court of British Columbia naming the Registrant as the sole defendant. ME alleges that the Registrant has failed to pay certain monies owed to ME for services rendered. The Registrant disputes the amount owed. ME is seeking payment of all outstanding fees.  ITEM 1A. RISK FACTORS.  We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.  ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.   1. Issuance of Equity Securities in exchange for services:  On August 26, 2009, the Registrant issued 5,000,000 shares of its common stock as payment to a consultant for services. The shares were valued at $98,802, which represents the value of the services on the award date.  On October 26, 2009, the Registrant issued 2,000,000 shares of its restricted common stock as payment to a related party to settle outstanding debt. The shares were valued $0.012 per share, which represents the value of the services on the award date.  On November 19, 2009 the Registrant issued 2,650,000 shares of its restricted common stock as payment to settle outstanding debt. The shares were valued at $0.01 per share, which represents the value of the debt on the award debt.  On November 19, 2009 the Registrant issued 10,000,000 shares of its restricted common stock as payment to a related party to settle outstanding debt. The shares were valued at $0.01 per share, which represents the value of the debt on the award debt.  On November 19, 2009 the Registrant issued 1,500,000 shares of its restricted common stock as payment to a law firm based in British Columbia for services. The shares were valued at $0.01 per share, which represents the value of the services on the award debt.  31   2. Convertible Securities:  None.  3. Outstanding Warrants:  None  4. Sales of Equity Securities for Cash:  None.  5. Other Issuances:  None.  ITEM 3. DEFAULTS UPON SENIOR SECURITIES.  None  ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.  None  ITEM 5. OTHER INFORMATION.  None  ITEM 6. EXHIBITS  The following exhibits are filed with this Quarterly Report on Form 10-Q:  EXHIBIT NUMBERDESCRIPTIONLOCATION3.1 - 3.2Articles of Incorporation and BylawsIncorporated by reference as Exhibits to the Form 8-K filed on December 12, 2004 as amended on February 3, 2005.10.1Share Exchange Agreement between Vitasti, Inc. and Welwind Energy International Corporation.Incorporated by reference as an Exhibit to the Form 8-K filed on August 17, 2006 as amended on December 20, 2006.31.1Rule 13a-14(a)/15d-14(a) Certification (CEO)Filed herewith31.2Rule 13a-14(a)/15d-14(a) Certification (CFO)Filed herewith32.1Section 1350 Certification (CEO)Filed herewith32.2Section 1350 Certification (CFO)Filed herewith   32   SIGNATURES  In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the Undersigned, thereunto duly authorized.  WELWIND ENERGY INTERNATIONAL CORP.     Dated: December 16, 2009 /s/ Tammy-Lynn McNabb By: Tammy-Lynn McNabb Its: President and CEO   33