----

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**FORM      10-KSB**

**      ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d)**

**OF      THE SECURITIES EXCHANGE ACT OF 1934**

***Turner      Valley Oil & Gas, Inc.***

| Nevada                                                     | Optional                                            |
|------------------------------------------------------------|-----------------------------------------------------|
| (Jurisdiction                of Incorporation)             | (I.R.S.                Employer Identification No.) |
|                                                       |                                                |
| 604-700                West Pender Street Vancouver Canada | V6G                1G8                              |
| (Address                of principal executive offices)    | (Zip                Code)                           |

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O

| INTRODUCTION                                                                                                               | 3      |
|----------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                       |   |
| PART                I                                                                                                      | 3      |
|                                                                                                                       |   |
| ITEM                1. Description of Business                                                                             | 3      |
| (a)                Form and Year of Organization                                                                           | 3      |
| (b)                Our Business                                                                                            | 3      |
|                                                                                                                       |   |
| ITEM                2. Description of Property                                                                             | 4      |
|                                                                                                                       |   |
| ITEM                3. Legal Proceedings                                                                                   | 4      |
|                                                                                                                       |   |
| ITEM                4. Submission of Matters to a Vote of Security                Holders                                  | 4      |
|                                                                                                                       |   |
| PART                II                                                                                                     | 4      |
|                                                                                                                       |   |
| ITEM                5. Market for Common Equity and Stockholder                Matters                                     | 4      |
| (a)                Market Information                                                                                      | 4      |
| (b)                Holders                                                                                                 | 5      |
| (c)                Dividends                                                                                               | 5      |
| (d)                Sales of Unregistered Common Stock                2006                                                  | 5      |
|                                                                                                                       |   |
| ITEM                6. Management's Discussion and Analysis or Plan of                Operation                            | 5      |
| (a)                Plan of Operation                                                                                       | 5      |
| (c)                Liquidity/Results of Operation                                                                          | 7      |
|                                                                                                                       |   |
| ITEM                7. Financial Statements                                                                                | 7      |
|                                                                                                                       |   |
| ITEM                8. Changes In and Disagreements With Accountants on                Accounting and Financial Disclosure | 8      |
|                                                                                                                       |   |
| PART                III                                                                                                    | 9      |
|                                                                                                                       |   |
| ITEM                9. Directors and Executive Officers, Promoters and Control                Persons                      | 9      |
|                                                                                                                       |   |
| ITEM                10. Executive Compensation                                                                             | 9      |
|                                                                                                                       |   |
| ITEM                11. Security Ownership of Certain Beneficial Owners and                Management                      | 10     |
|                                                                                                                       |   |
| Item                12. Controls and Procedures                                                                            | 11     |
|                                                                                                                       |   |
| ITEM                13. Attachments, Financial Statements, Exhibits, and                Reports on Form 8-K                | 12     |
| (b)                Exhibits                                                                                                | 12     |
| Signatures                                                                                                                 | 12     |

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*Table            of Contents*

**INTRODUCTION**

**PART      I**

**ITEM      1.**
**      Description of Business.**

**(a**
**)      Form and Year of Organization. **

|                                                  |   |                     |    |   |   |
|-------------------------------------------------------|--------|--------------------------|---------|--------|--------|
| Current                Year Issuances                 |   | Valued                at |    | Shares |   |
| Carried                from 12/31/05                  |   |                     |    |   |   | 55,535,970 |   |
| Issue                4/01/07: Registered for services |   | $                        | 750,000 |   |   | 3,000,000 |   |
| Total                Issued and Outstanding 12/31/05  |   | $                        | 750,000 |   |   | 58,535,970 |   |

**(b**
**)      Our Business.**
*Turner      Valley Oil and Gas Inc.*
*Turner      Valley Oil and Gas Inc.*

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*Table            of Contents*

**Risk      Tolerance**

**DESCRIPTION      OF OIL & GAS PROPERTIES**

**ITEM      2. Description of Property.**

**ITEM      3. Legal Proceedings.**

**ITEM      4. Submission of Matters to a Vote of Security      Holders.**

**PART      II**

**ITEM      5. Market for Common Equity and Stockholder      Matters.**

**(a**
**)      Market Information. **

|                                                  |   |                    |   |                   |   |       |
|-------------------------------------------------------|--------|-------------------------|--------|------------------------|--------|------------|
| PERIOD                                                |   | HIGH                BID |   | LOW                BID |   | VOLUME     |
| 1st                2004                               |   | 0.58                    |   | 0.24                   |   | 41,233,640 |
| 2nd                2004                               |   | 0.33                    |   | 0.10                   |   | 12,618,360 |
| Reverse                Split: Ten shares to One Share |
| 3rd                2004                               |   | 0.18                    |   | 0.12                   |   | 4,784,580  |
| 4th                2004                               |   | 0.34                    |   | 0.12                   |   | 22,427,460 |
| 1st                2005                               |   | 0.38                    |   | 0.21                   |   | 59,337,300 |
| 2nd                2005                               |   | 0.29                    |   | 0.12                   |   | 15,100,140 |
| 3rd                2005                               |   | 0.19                    |   | 0.12                   |   | 11,437,060 |
| 4th                2005                               |   | 0.14                    |   | 0.06                   |   | 10,552,140 |
| 1st                2006                               |   | 0.23                    |   | 0.06                   |   | 13,434,000 |
| 2nd                2006                               |   | 0.22                    |   | 0.03                   |   | 7,754,000  |
| 3rd                2006                               |   | 0.14                    |   | 0.07                   |   | 6,864,000  |
| 4th                2006                               |   | 0.11                    |   | 0.07                   |   | 9,134,000  |

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*Table            of Contents*

**(b**
**)      Holders. **

**(c**
**)      Dividends. **

**(d**
**)      Sales of Unregistered Common Stock 2006. **

**ITEM        6. Management's Discussion and Analysis or Plan of        Operation.**

**(a)        Plan of Operation. **
*Turner        Valley Oil & Gas*

**(b)        Discussion and Analysis of Financial Condition and Results of Operations.        **

**The        Strachan Property**

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*Table            of Contents*

**The        Strachan Property - Leduc Formation**

|   | 1) | In                  the spacing unit for the Earning Well, a 1.500% interest in the                  petroleum                  and natural gas below the base of the Mannville excluding natural                  gas in                  the Leduc formation, and a 3.00% interest in the natural gas in                  the Leduc                  formation before payout subject to payment of an Overriding Royalty                  which                  is convertible upon payout at the Royalty Owners option to 50%                  of our                  interest. |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2) | A                  1.200% interest in the rights below the base line of the Shunda                  formation                  in Section 10,Township 38, Range                  9W5M |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3) | A                  0.966% interest in the rights below the base of the Shunda formation                  in                  sections 15 & 16,Township 38,Range 9W5M, down to the base of the                  deepest formation penetrated. |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Mississippi        Prospect**

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*Table            of Contents*

**General          and Administrative costs**

**(c)        **
***Liquidity***
**.**

**ITEM      7. Financial Statements.**

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*Table            of Contents*

**Audited      Financial Statements**

**ITEM      8. Changes In and Disagreements With Accountants**
**on      Accounting and Financial Disclosure.**

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*Table            of Contents*

**PART      III**

**ITEM      9. Directors and Executive Officers, Promoters and Control      Persons.**

**ITEM      10. Executive Compensation.**

**Summary      Compensation, Table A.**

|                                                             |   |                                 |   |      |   |     |   |                        |   | Long                  Term Compensation |   |                                                   |
|------------------------------------------------------------------|--------|--------------------------------------|--------|-----------|--------|----------|--------|-----------------------------|--------|-----------------------------------------|--------|--------------------------------------------------------|
|                                                             |   | Annual                  Compensation |   | Awards    |   | Payouts  |   |                        |
| a                                                                |   | b                                    |   | c         |   | d        |   | e                           |   | f                                       |   | g                                                      |   | h |   | i |
| NameandPrincipalPosition                                         |   | Year                                 |   | Salary($) |   | Bonus($) |   | OtherAnnualCompen-sation($) |   | Restric-tedStockAwards($)               |   | Securi-tiesUnder-lyingOptionsSARs                  (#) |   | LTIPPayouts($) |   | All                  OtherCompen-sation($) |
| CHISTOPERPATON-GAY,Chairman,                  CEO                |   | 2006                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 660.0000 |
|                                                             |   | 2005                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 180,500 |
|                                                             |   | 2004                                 |   |      |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 277,000 |
| KULWANT                  SANDHER Treasurer,                  CFO |   | 2006                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 72,000 |
|                                                             |   | 2005                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 116,000 |
|                                                             |   | 2004                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 97,500 |
| DONALD                  JACKSON WELLS,Director                   |   | 2006                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 23,750 |
|                                                             |   | 2005                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 29,750 |
|                                                             |   | 2004                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 37,000 |
| JOSEPH                  A. KANEDirector                          |   | 2006                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 23,750 |
|                                                             |   | 2005                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 29,750 |
|                                                             |   | 2004                                 |   | 0         |   | 0        |   | 0                           |   | 0                                       |   | 0                                                      |   | 0 |   | 37,000 |

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*Table            of Contents*

**ITEM      11. Security Ownership of Certain Beneficial Owners and      Management.**

**COMMON      STOCK**

| NAME                  AND ADDRESS OF BENEFICIAL OWNER                                                         |   | SHAREOWNERSHIP |                 | %      |   |
|---------------------------------------------------------------------------------------------------------------|--------|----------------|----------------------|--------|--------|
| Christopher                  Paton-Gay6160                  Genoa Bay RoadDuncan                  B.C. Canada |   |           | Chairman/CEODirector |   |   | 2,285,000 |   |   | 3.90 |   |
| Kulwant                  Sander6160                  Genoa Bay RoadDuncan                  B.C. Canada        |   |           | Treasurer/CFO        |   |   | 1,252,395 |   |   | 2.14 |   |
| Donald                  Jackson Wells3131                  S.W. Freeway #46Houston                  TX 77098  |   |           | Director             |   |   | 75,800 |   |   | 0.13 |   |
| Joseph                  Kane3131                  S.W. Freeway #46Houston                  TX 77098           |   |           | Director             |   |   | 75,800 |   |   | 0.13 |   |
| All                  Officers and Directors as a Group                                                        |   |           |                 |   |   | 3,688,995 |   |   | 6.30 |   |
|                                                                                                          |   |           |                 |   |   |   |   |   |   |   |
| Total                  Issued and Outstanding                                                                 |   |           |                 |   |   | 58,535,970 |   |   | 100.00 |   |
| All                  Affiliates                                                                               |   |           |                 |   |   | (3,688,995 | ) |   | (6.30 | ) |
| Indicated                  Total Non-Affiliate Ownership                                                      |   |           |                 |   |   | 54,846,975 |   |   | 93.70 |   |

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*Table            of Contents*

**(a**
**)      Changes in Control.**

**ITEM      12. Controls and Procedures.**

**Evaluation      of Disclosure Controls and Procedures.**

**Changes      in Internal Accounting.**

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*Table            of Contents*

**ITEM      13. Attachments, Financial Statements, Exhibits, and Reports on      Form 8-K.**

**(a**
**)      Attachments/Exhibits Hereto.**

31

32

AC-99.1

**(b**
**)      Exhibits Previously Filed. **

**Signatures**

*Pursuant      to the requirements*

***Turner      Valley Oil & Gas, Inc.***

| Christopher                Paton-Gay |   | Donald                Jackson Wells |   | Joseph                Kane |
|--------------------------------------|--------|-------------------------------------|--------|----------------------------|
| Christopher                Paton-Gay |   | Donald                Jackson Wells |   | Joseph                Kane |

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*Table          of Contents*

**Attachment        AFK-06A**

**AUDITED        FINANCIAL STATEMENTS**

**for        the years ended**

**December        31, 2006, 2005**

**and        from inception**

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*Table          of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

**(A        Development Stage Company)**

**CONSOLIDATED        FINANCIAL STATEMENTS**

**December        31, 2006 and 2005**

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*Table            of Contents*

**C        O N T E N T S**

| Report                  of Independent Registered Pubic Accounting Firm | 3      |
|-------------------------------------------------------------------------|--------|
|                                                                    |   |
| Consolidated                  Balance Sheets                            | 4      |
|                                                                    |   |
| Consolidated                  Statements of Operations                  | 5      |
|                                                                    |   |
| Consolidated                  Statements of Stockholders’ Equity  | 6      |
|                                                                    |   |
| Consolidated                  Statements of Cash Flows                  | 8      |
|                                                                    |   |
| Notes                  to the Consolidated Financial statements         | 10     |

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*Table            of Contents*

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*Table          of Contents*

**TURNER        VALLEY OIL & GAS, INC.**

| ASSETS                                                                                                                                                                                    |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                      |   | December                  31,2006 |   | December                  31,2005 |   |
|                                                                                                                                                                                      |   |   |   |   |   |
| CURRENT                  ASSETS                                                                                                                                                           |   |   |   |   |   |   |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Cash                                                                                                                                                                                      |   | $ | - |   | $ | 78,848 |   |
| Accounts                  receivable                                                                                                                                                      |   |   | 8,910 |   |   | 2,546 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Total                  Current Assets                                                                                                                                                     |   |   | 8,910 |   |   | 81,394 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| OIL                  AND GAS PROPERTIES USING FULL COST ACCOUNTING                                                                                                                        |   |   |   |   |   |   |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Properties                  subject to amortization                                                                                                                                       |   |   | 28,177 |   |   | 38,175 |   |
| Unproved                  properties                                                                                                                                                      |   |   | 925,544 |   |   | 164,054 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Net                  Oil and Gas Properties                                                                                                                                               |   |   | 953,721 |   |   | 202,229 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| OTHER                  ASSETS                                                                                                                                                             |   |   |   |   |   |   |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Investments                  - Marketable Securities available for sale                                                                                                                   |   |   | 604,349 |   |   | 155,651 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Total                  Other Assets                                                                                                                                                       |   |   | 604,349 |   |   | 155,651 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| TOTAL                  ASSETS                                                                                                                                                             |   | $ | 1,566,980 |   | $ | 439,274 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' EQUITY                                                                                                                                     |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| CURRENT                  LIABILITIES                                                                                                                                                      |   |   |   |   |   |   |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Bank                  Overdraft                                                                                                                                                           |   | $ | 3,397 |   |   | - |   |
| Accounts                  payable                                                                                                                                                         |   |   | 400,410 |   | $ | 5,958 |   |
| Notes                  payable, related party                                                                                                                                             |   |   | 23,658 |   |   | 23,658 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Total                  Current Liabilities                                                                                                                                                |   |   | 427,465 |   |   | 29,616 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Total                  Liabilities                                                                                                                                                        |   |   | 427,465 |   |   | 29,616 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Other                  Commitments or Contingencies                                                                                                                                       |   |   | - |   |   | - |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| STOCKHOLDERS'                  EQUITY                                                                                                                                                     |   |   |   |   |   |   |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Common                  stock, 100,000,000 shares authorized of $0.001 par value, 58,535,984                  and                  53,385,984 shares issued and outstanding, respectively |   |   | 58,537 |   |   | 53,387 |   |
| Capital                  in excess of par value                                                                                                                                           |   |   | 4,697,173 |   |   | 4,185,323 |   |
| Accumulated                  other comprehensive income                                                                                                                                   |   |   | 495,283 |   |   | (4,810 | ) |
| Deficit                  accumulated during the development stage                                                                                                                         |   |   | (4,111,478 | ) |   | (3,824,242 | ) |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| Total                  Stockholders' Equity                                                                                                                                               |   |   | 1,139,515 |   |   | 409,658 |   |
|                                                                                                                                                                                      |   |   |   |   |   |   |   |
| TOTAL                  LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                                                               |   | $ | 1,566,980 |   | $ | 439,274 |   |

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*Table              of Contents*

**TURNER        VALLEY OIL & GAS, INC.**

**(A        Development Stage Company)**

|                                                                  |   | For                  theThree                  Months EndedDecember                  31, |       | For                  theYear                  EndedDecember                  31, |   | FromInception                  onApril                  21, 1999ThroughDecember                  31, |   |
|-----------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------|------------|----------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------|--------|
|                                                                  |   | 2006                                                                                     |       | 2005                                                                             |   | 2006                                                                                                 |   | 2005 |   | 2006 |   |
| REVENUE                                                               |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Royalties                  received                                   |   | $                                                                                        | 985        |                                                                             | $      | -                                                                                                    |   | $ | 9,813 |   | $ | 1,640 |   | $ | 20,874 |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| EXPENSES                                                              |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Cost                  of production                                   |   |                                                                                     | -          |                                                                             |   | -                                                                                                    |   |   | - |   |   | 42,403 |   |   | 51,753 |   |
| Depletion                                                             |   |                                                                                     | 5,000      |                                                                             |   | 2,500                                                                                                |   |   | 10,000 |   |   | - |   |   | 20,767 |   |
| General                  and administrative                           |   |                                                                                     | 377,941    |                                                                             |   | 1,012                                                                                                |   |   | 713,345 |   |   | 669,980 |   |   | 4,695,178 |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Total                  Expenses                                       |   |                                                                                     | 382,941    |                                                                             |   | 3,512                                                                                                |   |   | 723,345 |   |   | 712,383 |   |   | 4,767,698 |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| NET                  OPERATING LOSS                                   |   |                                                                                     | (381,956   | )                                                                                |   | (3,512                                                                                               | )      |   | (713,532 | ) |   | (710,743 | ) |   | (4,746,824 | ) |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| OTHER                  INCOME (EXPENSE)                               |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Gain                  on sale of investments                          |   |                                                                                     | 366,134    |                                                                             |   | 237,825                                                                                              |   |   | 426,295 |   |   | 237,825 |   |   | 638,638 |   |
| Interest                  expense                                     |   |                                                                                     | -          |                                                                             |   | -                                                                                                    |   |   | - |   |   | - |   |   | (3,292 | ) |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Total                  Other Income (Expense)                         |   |                                                                                     | 366,134    |                                                                             |   | 237,825                                                                                              |   |   | 426,295 |   |   | 237,825 |   |   | 635,346 |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| NET                  PROFIT/(LOSS) BEFORE INCOME TAX                  |   | $                                                                                        | (15,822    | )                                                                                | $      | 234,313                                                                                              |   | $ | (287,236 | ) | $ | (472,918 | ) | $ | (4,111,478 | ) |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Income                  tax                                           |   | $                                                                                        | -          |                                                                             | $      | -                                                                                                    |   | $ | - |   | $ | - |   | $ | - |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| NET                  PROFIT/(LOSS)                                    |   | $                                                                                        | (15,822    | )                                                                                | $      | 234,313                                                                                              |   | $ | (287,236 | ) | $ | (472,918 | ) | $ | (4,111,478 | ) |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| BASIC                  LOSS PER COMMON SHARE                          |   | $                                                                                        | (0.00      | )                                                                                | $      | 0.00                                                                                                 |   | $ | (0.01 | ) | $ | (0.01 | ) |   |   |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| WEIGHTED                  AVERAGE NUMBER OF COMMON SHARES OUTSTANDING |   |                                                                                     | 55,651,737 |                                                                             |   | 49,694,775                                                                                           |   |   | 55,651,737 |   |   | 50,743,518 |   |   |   |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| COMPREHENSIVE                  INCOME (LOSS)                          |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| NET                  LOSS                                             |   | $                                                                                        | (15,822    | )                                                                                | $      | 234,313                                                                                              |   | $ | (287,236 | ) | $ | (472,918 | ) | $ | (4,111,478 | ) |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| OTHER                  COMPREHENSIVE INCOME (LOSS)                    |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Unrealized                  Gain on Marketable Securities             |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   | 499,368 |   |   | - |   |   | 499,368 |   |
| Foreign                  Currency Translation                         |   |                                                                                     | -          |                                                                             |   | -                                                                                                    |   |   | (725 | ) |   | (725 | ) |   | (4,085 | ) |
|                                                                  |   |                                                                                     |       |                                                                             |   |                                                                                                 |   |   |   |   |   |   |   |   |   |   |
| COMPREHENSIVE                  INCOME (LOSS)                          |   | $                                                                                        | (15,822    | )                                                                                | $      | 234,313                                                                                              |   | $ | 211,407 |   | $ | (473,643 | ) | $ | (3,616,195 | ) |

----

*Table              of Contents*

**Turner        Valley Oil & Gas Corporation**

|                                                                            |   | Shares |           | Amount     |       | AdditionalPaid-in-Capital |       | ComprehensiveIncome/(Loss) |          | RetainedEarnings |       | SubscriptionReceivable |       |
|---------------------------------------------------------------------------------|--------|--------|----------------|------------|------------|---------------------------|------------|----------------------------|---------------|------------------|------------|------------------------|------------|
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |
| Balance                    at inception April 21, 1999                          |   |   | 0              |       |       | 0                         |       |                       | 0             |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for services during 1999                       |   |   | 41,080         |       |       | 41                        |       |                       | 5,094         |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for cash during 1999                           |   |   | 16,000         |       |       | 16                        |       |                       | 99,984        |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Net                    Loss for the period ended December 31, 1999              |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   | (96,935 | ) |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Balance                    at December 31, 1999                                 |   |   | 57,080         |       |       | 57                        |       |                       | 105,078       |             |       | 0                      |       |   | (96,935 | ) |   | 0 |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Net                    Loss for the period ended December 31, 2000              |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   | (27,242 | ) |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Balance                    at December 31, 2000                                 |   |   | 57,080         |       |       | 57                        |       |                       | 105,078       |             |       | 0                      |       |   | (124,177 | ) |   | 0 |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Net                    Loss for the period ended December 31, 2001              |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   | (65,380 | ) |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Balance                    at December 31, 2001                                 |   |   | 57,080         |       |       | 57                        |       |                       | 105,078       |             |       | 0                      |       |   | (189,557 | ) |   | 0 |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for debt reduction during 2002                 |   |   | 8,000          |       |       | 8                         |       |                       | 99,992        |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for services during 2002                       |   |   | 2,190,150      |       |       | 2,190                     |       |                       | 1,092,885     |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Net                    Loss for the period ended December 31, 2002              |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   | (1,240,008 | ) |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Balance                    at December 31, 2002                                 |   |   | 2,255,230      |       |       | 2,255                     |       |                       | 1,297,955     |             |       | 0                      |       |   | (1,429,565 | ) |   | 0 |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for services at $.02 per share                 |   |   | 1,500,000      |       |       | 1,500                     |       |                       | 298,500       |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Rounding                    of shares from reverse split                        |   |   | 2,000          |       |       | 2                         |       |                       | (2            | )                |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for accounts payable at $.05 Per share         |   |   | 8,000,000      |       |       | 8,000                     |       |                       | 392,000       |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for services at $.015 per share                |   |   | 31,729,200     |       |       | 31,729                    |       |                       | 444,209       |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for services at $.015 per share                |   |   | 9,487,504      |       |       | 9,488                     |       |                       | 132,825       |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.05 per share |   |   | 2,000,000      |       |       | 2,000                     |       |                       | 98,000        |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.05 per share |   |   | 650,000        |       |       | 650                       |       |                       | 31,850        |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Cancellation                    of Common Stock                                 |   |   | (16,691,520    | )          |       | (16,692                   | )          |                       | (220,459      | )                |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for cash at $.05 per share                     |   |   | 3,000,000      |       |       | 3,000                     |       |                       | 147,000       |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for cash at $.30 per share                     |   |   | 100,000        |       |       | 100                       |       |                       | 29,900        |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Shares                    issued for cash at $.35 per share                     |   |   | 528,570        |       |       | 529                       |       |                       | 184,471       |             |       |                   |       |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Foreign                    Currency Translation                                 |   |   |           |       |       |                      |       |                       |          |             |       | (1,718                 | )          |   |   |   |   |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Net                    Loss for the period ended December 31, 2003              |   |   | **0**          | ** ** | ** ** | **0**                     | ** ** | ** **                 | **0**         | ** **       | ** ** |                   | ** ** | ** ** | **(1,137,760** | **)** | ** ** |   |   |
|                                                                            |   |   |           |       |       |                      |       |                       |          |             |       |                   |       |   |   |   |   |   |   |
| Balance                    at December 31, 2003                                 |   |   | **42,560,984** |       |       | **42,561**                |       |                       | **2,836,249** |             |       | **(1,718**             | **)**      |   | **(2,567,325** | **)** |   | **0** |   |

----

*Table                of Contents*

**Turner          Valley Oil & Gas Corporation**

|                                                                            |   | Shares |           | Amount |   | AdditionalPaid-in-Capital |   | ComprehensiveIncome/(Loss) |          | RetainedEarnings |   | SubscriptionReceivable |   |
|---------------------------------------------------------------------------------|--------|--------|----------------|--------|--------|---------------------------|--------|----------------------------|---------------|------------------|--------|------------------------|--------|
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.20 per share |   |   | 932,500        |   |   | 933                       |   |                       | 185,567       |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.08 per share |   |   | 1,597,500      |   |   | 1,598                     |   |                       | 126,202       |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.08 per share |   |   | 1,000,000      |   |   | 1,000                     |   |                       | 79,000        |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.11 per share |   |   | 85,000         |   |   | 85                        |   |                       | 9,265         |             |   |                   |   |   |   |   |   |   |   |
| 9/30/2004                                                                       |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.20 per share |   |   | 1,385,000      |   |   | 1,385                     |   |                       | 275,615       |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued for Cash at $.05 per share                     |   |   | 975,000        |   |   | 975                       |   |                       | 47,775        |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Subscription                    Recievable                                      |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   | (48,750 | ) |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Foreign                    Currency Translation                                 |   |   |           |   |   |                      |   |                       |          |             |   | **(2,367**             | **)**  |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Net                    Loss for the period ended December 31, 2004              |   |   | **0**          |   |   | **0**                     |   |                       | **0**         |             |   | **0**                  |   |   | **(784,001** | **)** |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Balance                    at December 31, 2004                                 |   |   | **48,535,984** |   |   | **48,537**                |   |                       | **3,559,673** |             |   | **(4,085**             | **)**  |   | **(3,351,325** | **)** |   | **(48,750** | **)** |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.13 per share |   |   | 2,850,000      |   |   | 2,850                     |   |                       | 367,650       |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.13 per share |   |   | 2,000,000      |   |   | 2,000                     |   |                       | 258,000       |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Foreign                    Currency Translation                                 |   |   |           |   |   |                      |   |                       |          |             |   | (725                   | )      |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Subscription                    Recievable                                      |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   | 48,750 |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Net                    Loss for the period ended December 31, 2005              |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   | (472,917 | ) |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |                |   |   |                           |   |                       |               |             |   |                        |   |   |  |   |   |  |   |
| **Balance                    at December 31, 2005**                             |   |   | **53,385,984** |   |   | **53,387**                |   |                       | **4,185,323** |             |   | **(4,810**             | **)**  |   | **(3,824,242** | **)** |   | **0** |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.13 per share |   |   | 2,000,000      |   |   | 2,000                     |   |                       | 258,000       |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.08 per share |   |   | 1,600,000      |   |   | 1,600                     |   |                       | 126400        |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued pursuant to S-8 registration at $.08 per share |   |   | 1,450,000      |   |   | 1,450                     |   |                       | 114,550       |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Shares                    issued under Rule 144 at $0.13 per share              |   |   | 100,000        |   |   | 100                       |   |                       | 12,900        |             |   |                   |   |   |   |   |   |   |   |
|                                                                            |   |   |           |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| Net                    Income for the year ended December 31, 2006              |   |   |           |   |   |                      |   |                       |          |             |   | 500,093                |   |   | (287,236 | ) |   |   |   |
|                                                                            |   |   |      |   |   |                      |   |                       |          |             |   |                   |   |   |   |   |   |   |   |
| **Balance                    as at December 31, 2006**                          |   |   | **58,535,984** |   |   | **58,537**                |   |                       | **4,697,173** |             |   | **495,283**            |   |   | **(4,111,478** | **)** |   | **0** |   |

----

*Table              of Contents*

**TURNER        VALLEY OIL & GAS, INC.**

**(A        Development Stage Company)**

|                                                                                                          |   | For                  the Year EndedDecember                  31, |     | FromInception                  onApril                  21, 1999ThroughDecember                  31, |   |
|---------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------|----------|------------------------------------------------------------------------------------------------------|--------|
|                                                                                                          |   | 2006                                                             |     | 2005                                                                                                 |   | 2006 |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |
| CASH                  FLOWS FROM OPERATING ACTIVITIES:                                                        |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Net                  loss                                                                                     |   | $                                                                | (287,234 | )                                                                                                    | $      | (472,917 | ) | $ | (4,111,478 | ) |
| Adjustments                  to reconcile net loss to net cash used in operating                  activities: |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Depletion                                                                                                     |   |                                                             | (761,490 | )                                                                                                    |   | - |   |   | 20,767 |   |
| Loss                  on abandonment of property                                                              |   |                                                             | -        |                                                                                                 |   | - |   |   | 25,481 |   |
| Gain                  on sale of Investment                                                                   |   |                                                             | (436,388 | )                                                                                                    |   | (237,825 | ) |   | (674,213 | ) |
| Common                  stock issued for services rendered                                                    |   |                                                             | 517,000  |                                                                                                 |   | 630,501 |   |   | 4,241,960 |   |
| Non-cash                  Effect from Foreign Currency Translation                                            |   |                                                             | 725      |                                                                                                 |   | (725 | ) |   | (4,080 | ) |
| Changes                  in operating assets and liabilities:                                                 |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Increase                  (Decrease) in bank Overdraft                                                        |   |                                                             | 3,397    |                                                                                                 |   | - |   |   | 3,397 |   |
| Increase                  (Decrease) in accounts receivable                                                   |   |                                                             | (6,364   | )                                                                                                    |   | 2,263 |   |   | (289 | ) |
| Increase                  (Decrease) in accounts payable - related Party                                      |   |                                                             |     |                                                                                                 |   | - |   |   | 23,659 |   |
| Increase                  in accounts payable and accrued expenses                                            |   |                                                             | 394,450  |                                                                                                 |   | (13,094 | ) |   | 291,782 |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Net                  Cash Used in Operating Activities                                                        |   |                                                             | (575,904 | )                                                                                                    |   | (91,797 | ) |   | (183,014 | ) |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| CASH                  FLOWS FROM INVESTING ACTIVITIES:                                                        |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Proceeds                  from sale of investments                                                            |   |                                                             | 487,058  |                                                                                                 |   | 263,758 |   |   | 807,522 |   |
| Investing                  in new Oil & Gas working interests                                             |   |                                                             | 9,998    |                                                                                                 |   | (164,054 | ) |   | (825,544 | ) |
| Expenditures                  for oil and gas property development                                            |   |                                                             |     |                                                                                                 |   | - |   |   | (312,714 | ) |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Net                  Cash Used in Investing Activities                                                        |   |                                                             | 497,056  |                                                                                                 |   | 99,704 |   |   | (330,736 | ) |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| CASH                  FLOWS FROM FINANCING ACTIVITIES:                                                        |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Proceeds                  from issuance of common stock                                                       |   |                                                             | -        |                                                                                                 |   | - |   |   | 465,000 |   |
| Receipt                  of subscription receivable                                                           |   |                                                             | -        |                                                                                                 |   | 48,750 |   |   | 48,750 |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| Net                  Cash Provided by Financing Activities                                                    |   |                                                             | -        |                                                                                                 |   | 48,750 |   |   | 513,750 |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| NET                  INCREASE (DECREASE) IN CASH                                                              |   |                                                             | (78,848  | )                                                                                                    |   | 56,657 |   |   | - |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| CASH                  AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                             |   |                                                             | 78,848   |                                                                                                 |   | 22,191 |   |   | - |   |
|                                                                                                          |   |                                                             |     |                                                                                                 |   |   |   |   |   |   |
| CASH                  AND CASH EQUIVALENTS AT END OF PERIOD                                                   |   | $                                                                | -        |                                                                                                 | $      | 78,848 |   | $ | - |   |

----

*Table              of Contents*

**TURNER        VALLEY OIL & GAS, INC.**

|                                                            |   | For                  the Year EndedDecember                  31, |    | FromInception                  onApril                  21, 1999ThroughDec-31 |   |
|-----------------------------------------------------------------|--------|------------------------------------------------------------------|---------|-------------------------------------------------------------------------------|--------|
|                                                            |   | 2006                                                             |    | 2005                                                                          |   | 2006 |   |
|                                                            |   |                                                             |    |                                                                          |   |   |   |
| SUPPLEMENTAL                  CASH FLOW INFORMATION             |   |                                                             |    |                                                                          |   |   |   |   |   |   |
|                                                            |   |                                                             |    |                                                                          |   |   |   |   |   |   |
| CASH                  PAID FOR:                                 |   |                                                             |    |                                                                          |   |   |   |   |   |   |
|                                                            |   |                                                             |    |                                                                          |   |   |   |   |   |   |
| Interest                                                        |   | $                                                                | -       |                                                                          | $      | - |   | $ | - |   |
| Income                  taxes                                   |   | $                                                                | -       |                                                                          | $      | - |   | $ | - |   |
|                                                            |   |                                                             |    |                                                                          |   |   |   |   |   |   |
| NON-CASH                  FINANCING ACTIVITIES                  |   |                                                             |    |                                                                          |   |   |   |   |   |   |
|                                                            |   |                                                             |    |                                                                          |   |   |   |   |   |   |
| Common                  stock issued for services rendered      |   | $                                                                | 517,000 |                                                                          | $      | 630,501 |   | $ | 3,709,460 |   |
| Common                  stock issued for retirement of payables |   | $                                                                | -       |                                                                          | $      | - |   | $ | 532,500 |   |

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*Table              of Contents*

**TURNER          VALLEY OIL & GAS CORPORATION**

| NOTE                    1 - | SUMMARY                    OF SIGNIFICANT ACCOUNTING POLICIES |
|-----------------------------|---------------------------------------------------------------|

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**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  1 - | SUMMARY                  OF SIGNIFICANT ACCOUNTING POLICIES                  (Continued) |
|---------------------------|------------------------------------------------------------------------------------------|

|                                                   |   | Income                  (Loss)(Numerator) |     | Shares(Denominator) |   | Per-ShareAmount |   |
|--------------------------------------------------------|--------|-------------------------------------------|----------|---------------------|--------|-----------------|--------|
| For                  the year ended December 31, 2006: |   |                                      |     |                |   |            |   |   |   |   |
| Basic                  EPS                             |   |                                      |     |                |   |            |   |   |   |   |
| Income                  (loss) to common stockholders  |   | $                                         | 212,132  |                |   | 55,651,737      |   | $ | 0.00 |   |
|                                                   |   |                                      |     |                |   |            |   |   |   |   |
| For                  the year ended December 31, 2005: |   |                                      |     |                |   |            |   |   |   |   |
| Basic                  EPS                             |   |                                      |     |                |   |            |   |   |   |   |
| Income                  (loss) to common stockholders  |   | $                                         | (472,918 | )                   |   | 50,743,518      |   | $ | (0.01 | ) |

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  1 - | SUMMARY                  OF SIGNIFICANT ACCOUNTING POLICIES                  (Continued) |
|---------------------------|------------------------------------------------------------------------------------------|

|                                                         |   | December                  31,2006 |       | December                  31,2005 |   |
|--------------------------------------------------------------|--------|-----------------------------------|------------|-----------------------------------|--------|
| Deferred                  tax assets:                        |   |                              |       |                              |   |   |   |
| Net                  operation loss carry-forwards           |   | $                                 | 3,612,110  |                              | $      | 3,946,812 |   |
| Total                  Deferred Tax Assets                   |   |                              | 1,228,123  |                              |   | 1,341,916 |   |
| Valuation                  allowance for deferred tax assets |   |                              | (1,228,123 | )                                 |   | (1,341,916 | ) |
|                                                         |   | $                                 | -          |                              | $      | - |   |

|                                              |   | 2006   |     | 2005   |   |
|---------------------------------------------------|--------|--------|----------|--------|--------|
|                                              |   |   |     |   |   |
| Book                  loss from operations        |   | $      | 72,125   |   | $      | -                  - |   |
| Not                  Used                         |   |   | (72,125  | )      |   |   |   |
| Common                  stock issued for services |   |   | 175,780  |   |   | 308,856 |   |
| Valuation                  allowance              |   |   | (175,780 | )      |   | (308,856 | ) |
|                                              |   | $      | -        |   | $      | - |   |

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  1 - | SUMMARY                  OF SIGNIFICANT ACCOUNTING POLICIES                  (Continued) |
|---------------------------|------------------------------------------------------------------------------------------|

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  1 - | SUMMARY                  OF SIGNIFICANT ACCOUNTING POLICIES                  (Continued) |
|---------------------------|------------------------------------------------------------------------------------------|

*Foreign        Currency Translation*

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  1 - | SUMMARY                  OF SIGNIFICANT ACCOUNTING POLICIES                  (Continued) |
|---------------------------|------------------------------------------------------------------------------------------|

|                                                |   | 2006   |   | 2005   |   |
|-----------------------------------------------------|--------|--------|--------|--------|--------|
| Accounts                  Receivable                |   | $      | 8,911  |   | $      | 2,546 |   |
| Less:                  Allowance for Doubtful Debts |   |   | -      |   |   | - |   |
| Net                  Accounts Receivable            |   | $      | 8,891  |   | $      | 2,546 |   |

| NOTE                  2 - | GOING                  CONCERN |
|---------------------------|--------------------------------|

| NOTE                  3 - | OIL                  & GAS PROPERTIES |
|---------------------------|-------------------------------------------|

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  4 - | STOCK                  TRANSACTIONS |
|---------------------------|-------------------------------------|

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  5 - | INVESTMENTS                  AND SALE OF OILS & GAS                  PROPERTIES |
|---------------------------|-------------------------------------------------------------------------------------|

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| NOTE                  6 - | OTHER                  COMPREHENSIVE INCOME |
|---------------------------|---------------------------------------------|

|                                                      |   | December                  31, |    |
|-----------------------------------------------------------|--------|-------------------------------|---------|
|                                                      |   | 2006                          |    | 2005 |   |
| Balance,                  beginning of year               |   | $                             | (4,810  | ) | $ | (4,085 | ) |
| Unrealized                  gain on marketable securities |   | $                             | 499,368 |   | $ | nil |   |
| Effect                  of currency exchange rate changes |   |                          | 725     |   |   | (725 | ) |
| Balance,                  end of year                     |   | $                             | 495,283 |   | $ | (4,810 | ) |

| NOTE                  7 - | RELATED                  PARTY TRANSACTION |
|---------------------------|--------------------------------------------|

|                                                      |   | December                  31, |   |
|-----------------------------------------------------------|--------|-------------------------------|--------|
| Note                  payable                             |   | 2006                          |   | 2005 |   |
| Balance,                  beginning of year               |   | $                             | 23,658 |   | $ | 35,000 |   |
| Advances                  received                        |   | $                             | 0      |   | $ | (11,866 | ) |
| Effect                  of currency exchange rate changes |   | $                             | 0      |   | $ | 524 |   |
| Balance,                  end of year                     |   | $                             | 23,658 |   | $ | 23,658 |   |

| NOTE                  8 - | LEASE                  COMMITMENTS |
|---------------------------|------------------------------------|

| Year                  ended December 31, 2007 |   | $ | 40,338 |   |
|-----------------------------------------------|--------|---|--------|--------|
| Year                  ended December 31, 2008 |   | $ | 40,338 |   |
| Year                  ended December 31, 2009 |   | $ | 30,254 |   |

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*Table            of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| (1) | Capitalized                  Costs Relating to Oil and Gas Producing Activities |   |
|-----|---------------------------------------------------------------------------------|--------|

|                                                                                                           |   | December                  31, |    |
|----------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
|                                                                                                           |   | 2006                          |    | 2005 |   |
| Proved                  oil and gas producing properties and related lease and well                  equipment |   | $                             | 48,942  |   | $ | 48,942 |   |
| Accumulated                  depreciation and depletion                                                        |   |                          | (20,767 | ) |   | (10,767 | ) |
|                                                                                                           |   |                          |    |   |   |   |   |
| Net                  Capitalized Costs                                                                         |   | $                             | 28,177  |   | $ | 38,175 |   |

| (2) | Costs                  Incurred in Oil and Gas Property Acquisition, Exploration, and                  Development                  Activities |   |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------|--------|

|                                       |   | For                  the Years EndedDecember                  31, |    |
|--------------------------------------------|--------|-------------------------------------------------------------------|---------|
|                                       |   | 2006                                                              |    | 2005 |   |
| Acquisition                  of Properties |   |                                                              |    |   |   |   |   |
| Proved                                     |   | $                                                                 | -       |   | $ | - |   |
| Unproved                                   |   |                                                              | 264,054 |   |   | - |   |
| Exploration                  Costs         |   |                                                              | -       |   |   | - |   |
| Development                  Costs         |   |                                                              | 661,490 |   |   | 164,054 |   |
| Total                  Costs Incurred      |   | $                                                                 | 925,544 |   | $ | 164,054 |   |

| (3) | Results                  of Operations for Producing Activities |   |
|-----|-----------------------------------------------------------------|--------|

|                                                                                                                                                |   | For                  the Years Ended December                  31, |    |
|-----------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|---------|
|                                                                                                                                                |   | 2006                                                               |    | 2005 |   |
| Sales                                                                                                                                               |   | $                                                                  | 9,813   |   | $ | 1,640 |   |
| Production                  costs                                                                                                                   |   |                                                               | (10,000 | ) |   | (2,564 | ) |
| Depreciation                  and depletion                                                                                                         |   |                                                               | -       |   |   | (10,000 | ) |
|                                                                                                                                                |   |                                                               |    |   |   |   |   |
| Results                  of operations for producing activities (excluding corporate overhead                  and                  interest costs) |   | $                                                                  | (187    | ) | $ | (10,924 | ) |

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*Table              of Contents*

**TURNER        VALLEY OIL & GAS CORPORATION**

| (4) | Reserve                  Quantity Information |   |
|-----|-----------------------------------------------|--------|

|                                                        |   | OilBBL |   | GasMMCF |   |
|-------------------------------------------------------------|--------|--------|--------|---------|--------|
| Proved                  developed and undeveloped reserves: |   |   |   |    |   |   |   |
| Balance,                  December 31, 2005                 |   |   | -      |    |   | 4.67 |   |
| Change                  in estimates                        |   |   | -      |    |   | - |   |
| Production                                                  |   |   | -      |    |   | .99 |   |
| Balance,                  December 31, 2006                 |   |   | -      |    |   | 3.68 |   |

| Proved                  developed reserves:                    |   | OilBBL |   | GasMMCF |   |
|----------------------------------------------------------------|--------|--------|--------|---------|--------|
| Beginning                  of the year ended December 31, 2006 |   |   | -      |    |   | 4.67 |   |
| End                  of the year ended December 31, 2006       |   |   | -      |    |   | 3.68 |   |

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