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UNITED STATES

FORM 10-QSB/A

x



Commission File Number 000-33389

PAN AMERICAN ENERGY CORP.

Nevada
      52-2268239(State or other jurisdiction of
      (IRS Employer Identification No.)incorporation or organization)6644 NORTH OCEAN BOULEVARDOCEAN RIDGE, FLORIDA
      33435(Address of principal executive offices)
      (Zip Code)Issuer's telephone number, including area code:
      604- 608-3831


AUGUST BIOMEDICAL CORPORATION (Former name, former address and former fiscal year, if changed since last
report)

Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days

State the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 60,325,000 Shares of
$0.001 par value Common Stock outstanding as of May 31, 2004.

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TABLE OF CONTENTSPART I - FINANCIAL
    INFORMATION
    3ITEM 1. FINANCIAL
    INFORMATION
    3ITEM 2. MANAGEMENT'S
    DISCUSSIONS AND ANALYSIS OR PLAN OF OPERATION
    13Forward Looking Statements
    13Overview
    13Plan of Operations
    13Result of Operation for Period
    Ending May 31, 2004
    14Liquidity & Capital Resources
    14Stock-Based Compensation Expense
    14Off-Balance Sheet Arrangements
    15Changes in and Disagreements
    with Accountants on Accounting and Financial Disclosure
    15ITEM 3. CONTROLS AND
    PROCEDURES
    15PART II - OTHER
    INFORMATION
    16ITEM 1. LEGAL
    PROCEEDINGS
    16ITEM 2. CHANGES IN
    SECURITIES
    16ITEM 3. DEFAULTS
    UPON SENIOR SECURITIES
    16ITEM 4. SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS
    16ITEM 5. OTHER
    INFORMATION
    17ITEM 6. EXHIBITS AND
    REPORTS ON FORM 8-K
    18SIGNATURES
    19


-2-

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PART 1 - FINANCIAL INFORMATION

Item 1. Financial Statements







PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)





CONSOLIDATED INTERIM FINANCIAL STATEMENTS



MAY 31, 2004

(Unaudited)

(Stated in U.S. Dollars)





-3-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)



CONSOLIDATED BALANCE SHEET

(Unaudited)

(Stated in U.S. Dollars)





MAY 31
    AUGUST 312004
    2003(Restated - Note 8)ASSETSCurrentCash
    $
    -
    $
    850Goods and Services tax recoverable
    
    4,263
    
    3,7344,263
    
    4,584Equipment
    
    1
    
    1$
    4,264
    $
    4,585LIABILITIESCurrentAccounts payable and accrued
    liabilities
    $
    122,851
    $
    80,382STOCKHOLDERS' DEFICIENCYCapital StockAuthorized:100,000,000 Common shares, par value $0.001 per shareIssued and outstanding:60,325,000 Common shares
    
    60,325
    
    60,325Additional paid-in capital
    
    3,005,487
    
    3,005,487Share Subscriptions Received
    (Note 3)
    
    20,000
    
    20,000Deficit Accumulated During
    The Development Stage
    
    (3,204,399)
    
    (3,161,609)(118,587)
    
    (75,797)$
    4,264
    $
    4,585Basis Of Presentation And
    Nature Of Operations (Note 1)




-4-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)



CONSOLIDATED INTERIM STATEMENT OF OPERATIONS

(Unaudited)

(Stated in U.S. Dollars)



THREE MONTHSENDED MAY 31
    
    
    NINE MONTHSENDED
    MAY 31
    CUMULATIVE FROM INCEPTION MAY 26 2000 TO 20042004
    
    2003
    
    
    2004
    
    2003ExpensesAmortization
    $
    -
    $
    1,939
    
    $
    -
    $
    3,937
    
    $
    6,571Consulting Fees
    
    -
    
    49,661
    
    
    -
    
    184,048
    
    
    259,274General and Administrative
    
    329
    
    17,830
    
    
    822
    
    41,018
    
    
    54,744Interest
    
    -
    
    -
    
    
    -
    
    -
    
    
    20,000Investor relations
    
    -
    
    (4,000)
    
    
    -
    
    19,500
    
    
    22,690Mineral property option payments
    
    -
    
    -
    
    
    -
    
    -
    
    
    15,500Mineral property exploration
    expenditures
    
    3,895
    
    -
    
    
    3,895
    
    -
    
    
    16,168Oil and gas property option
    payment
    
    -
    
    -
    
    
    20,000
    
    -
    
    
    20,000Professional fees
    
    24,474
    
    22,374
    
    
    36,055
    
    84,076
    
    
    230,547Stock transfer fees
    
    1,453
    
    196
    
    
    2,018
    
    3,322
    
    
    7,729Stock-based compensation
    
    -
    
    -
    
    
    -
    
    2,535,812
    
    
    2,535,812Write down of advances
    receivable
    
    -
    
    -
    
    
    -
    
    -
    
    
    1,500Write down of equipment
    
    -
    
    -
    
    
    -
    
    -
    
    
    33,864Forgiveness of debt
    
    -
    
    -
    
    
    (20,000)
    
    -
    
    
    (20,000)Write down of intangible asset
    
    -
    
    200,000
    
    
    -
    
    200,000
    
    
    -Net Loss For the Period
    $
    30,151
    $
    288,000
    
    $
    42,790
    $
    3,071,713
    
    $
    3,204,399Basic and Diluted Loss Per
    Share
    $
    (0.01)
    $
    (0.01)
    
    $
    (0.01)
    $
    (0.05)Weighted Average Number of
    Shares Outstanding
    
    60,325,000
    
    60,325,000
    
    
    60,325,000
    
    60,138,810




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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)



CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS

(Stated in U.S. Dollars)



THREE MONTHSENDED MAY 31
    
    
    NINE MONTHSENDED MAY 31
    CUMULATIVE FROM INCEPTION MAY 26 2000 TO 20042004
    
    2003
    
    
    2004
    
    2003Cash Flows From Operating
    AcitivitiesNet loss for the period
    $
    (30,151)
    $
    (288,000)
    
    $
    (42,790)
    $
    (3,071,713)
    
    $
    (3,204,399)Items not involving cash:Amortization
    
    -
    
    1,939
    
    
    -
    
    3,937
    
    
    6,571Interest
    
    -
    
    -
    
    
    -
    
    -
    
    
    20,000Write down of equipment
    
    -
    
    -
    
    
    -
    
    -
    
    
    33,864Write down of intangible asset
    
    -
    
    200,000
    
    
    -
    
    200,000
    
    
    -Forgiveness of debt
    
    -
    
    -
    
    
    (20,000)
    
    -
    
    
    (20,000)Stock-based compensation
    
    -
    
    -
    
    
    -
    
    2,535,812
    
    
    2,535,812Adjustments To Reconcile Net
    Loss To Net Cash Used By Operating ActivitiesPrepaid Expenses
    
    -
    
    467
    
    
    -
    
    1,399
    
    
    -Goods and Services tax
    recoverable
    
    (74)
    
    (655)
    
    
    (529)
    
    (655)
    
    
    (4,263)Advances receivable
    
    -
    
    -
    
    
    -
    
    (1,500)
    
    
    -Accounts payable and accrued
    liabilities
    
    30,199
    
    22,650
    
    
    42,469
    
    555
    
    
    122,851(26)
    
    (63,599)
    
    
    (20,850)
    
    (332,165)
    
    
    (509,564)Cash Flows From Financing
    ActivitiesShare capital issued
    
    -
    
    -
    
    
    -
    
    180,160
    
    
    530,000Loan payable
    
    -
    
    -
    
    
    -
    
    180,000
    
    
    180,000Share subscriptions received
    
    -
    
    -
    
    
    -
    
    20,000
    
    
    20,000Advances payable
    
    -
    
    -
    
    
    20,000
    
    -
    
    
    20,000Advances from shareholder
    
    -
    
    -
    
    
    -
    
    -
    
    
    --
    
    -
    
    
    20,000
    
    380,160
    
    
    750,000Cash Flows From Investing
    ActivitiesPurchase of equipment
    
    -
    
    (12,689)
    
    
    -
    
    (28,114)
    
    
    (40,436)Patent acquisitions
    
    -
    
    -
    
    
    -
    
    (200,000)
    
    
    (220,000)Proceeds from sale of patent
    
    -
    
    -
    
    
    -
    
    -
    
    
    20,000-
    
    (12,689)
    
    
    -
    
    (228,114)
    
    
    (240,436)(Decrease) Increase In Cash
    
    (26)
    
    (76,288)
    
    
    (850)
    
    (180,119)
    
    
    -Cash, Beginning Of Period
    
    26
    
    79,777
    
    
    850
    
    183,608
    
    
    -Cash, End Of Period
    $
    -
    $
    3,489
    
    $
    -
    $
    3,489
    
    $
    -Supplemental Disclosure Of
    Non-Cash Financing ActivitiesPatent exchanged for loan
    repayment
    $
    -
    $
    -
    
    $
    -
    $
    -
    
    $
    200,000


-6-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)





NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS



MAY 31, 2004

(Unaudited)

(Stated in U.S. Dollars)



1. BASIS OF PRESENTATION AND NATURE OF OPERATIONS

1. The unaudited consolidated financial statements as of May 31, 2004
included herein have been prepared without audit pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with United States generally accepted principles have been condensed
or omitted pursuant to such rules and regulations. In the opinion of management,
all adjustments (consisting of normal recurring accruals) considered necessary
for a fair presentation have been included. It is suggested that these financial
statements be read in conjunction with the restated August 31, 2003 audited
financial statements and notes thereto (see note 8).
2. Organization

> The Company was incorporated on May 26, 2000 in the State of Nevada,
>     U.S.A. On December 31, 2002, the Company changed its name from Coyote
>     Ventures Corp. to August Biomedical Corporation.
>     On March 11, 2004, the Company split its common stock at the rate of
>     five-for-one ("forward split") and changed the authorized share capital from
>     100,000,000 shares of common stock with a par value of $0.001 per share to
>     the following:
>     i) 170,000,000 common shares with a par value of $0.001 per share;
>     ii) 25,000,000 preferred shares with a par value of $0.001 per share.
>     All references in the accompanying financial statements to the number of
>     common shares and per share amounts have been restated to reflect the
>     forward stock split.
>     On March 23, 2004, the Company changed its name from August Biomedical
>     Corporation to Pan American Energy Corp.

1. Development Stage Activities

> Pan American Energy Corp. (the "Company") is currently a development
>     stage company under the provisions of Statement of Financial Accounting
>     Standards ("SFAS") No. 7 engaged in the exploration, development and
>     acquisition of natural gas and oil properties in the United States. Prior to
>     this, the Company was engaged in the business of developing technology
>     related to cancer imaging systems and conducted business through its wholly
>     owned subsidiary, August Research Corporation. The Company has discontinued
>     this business and is devoting substantially all of its present efforts to
>     identifying and acquiring interests in the oil and gas properties.





-7-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)





NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS



MAY 31, 2004

(Unaudited)

(Stated in U.S. Dollars)

1. BASIS OF PRESENTATION AND NATURE OF OPERATIONS (Continued)

1. Going Concern

> The accompanying financial statements have been prepared assuming the
>     Company will continue as a going concern.
>     As shown in the accompanying financial statements, the Company has
>     incurred a net loss of $3,204,399 for the period from May 26, 2000
>     (inception) to May 31, 2004, and has no sales. The future of the Company is
>     dependent upon its ability to obtain financing and upon future profitable
>     operations from the development of its technology. Management has plans to
>     seek additional capital through a private placement and public offering of
>     its common stock. The financial statements do not include any adjustments
>     relating to the recoverability and classification of recorded assets, or the
>     amounts of and classification of liabilities that might be necessary in the
>     event the Company cannot continue in existence.

2. SIGNIFICANT ACCOUNTING POLICIES

The financial statements of the Company have been prepared in accordance
    with generally accepted accounting principles in the United States. Because
    a precise determination of many assets and liabilities is dependent upon
    future events, the preparation of financial statements for a period
    necessarily involves the use of estimates which have been made using careful
    judgement.

The financial statements have, in management's opinion, been properly
    prepared within reasonable limits of materiality and within the framework of
    the significant accounting policies summarized below:

1. Consolidation

> These financial statements include the accounts of the Company and its
>     wholly-owned subsidiary, August Research Corp., a British Columbia
>     corporation.





-8-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)





NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS



MAY 31, 2004

(Unaudited)

(Stated in U.S. Dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

1. Oil and Gas Properties

> The Company follows the successful efforts method of accounting for oil
>     and gas exploration and production activities. Acquisition costs,
>     development costs and successful exploration costs are capitalized.
>     Exploratory dry hole costs, lease rental, and geological and geophysical
>     costs are charged to expenses as incurred. Producing properties are depleted
>     by the units-of-production method based on estimated proved reserves.

1. Equipment

> Equipment is recorded at cost. Amortization of office equipment and
>     laboratory equipment is calculated on a straight-line basis at annual rates
>     of 30% and 20% respectively.
>     Equipment not used in operations have been written down to a nominal
>     value in the prior period.

1. Impairment of Long-Lived Assets

> The Company periodically evaluates potential impairments of its
>     long-lived assets, including intangibles. When the Company determines that
>     the carrying value of long-lived assets may not be recoverable based upon
>     the existence of one or more indicators of impairment, the Company evaluates
>     the projected undiscounted cash flows related to the assets. If these cash
>     flows are less than the carrying value of the assets, the Company measures
>     the impairment using discounted cash flows or other methods of determining
>     fair value.
>     Long-lived assets to be disposed of are carried at the lower of cost or
>     fair value less estimated costs of disposal.

1. Use of Estimates

> The preparation of financial statements in conformity with generally
>     accepted accounting principles requires management to make estimates and
>     assumptions that affect the reported amounts of assets and liabilities, and
>     disclosure of contingent assets and liabilities at the date of the financial
>     statements, and the reported amounts of revenues and expenses for the
>     reporting period. Actual results could differ from these estimates.





-9-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)





NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS



MAY 31, 2004

(Unaudited)

(Stated in U.S. Dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

1. Foreign Currency Translation

> The Company's functional currency is the U.S. dollar. Transactions in
>     foreign currency are translated into U.S. dollars as follows:
>     i) monetary items at the rate prevailing at the balance sheet date;
>     ii) non-monetary items at the historical exchange rate;
>     iii) revenue and expense at the average rate in effect during the
>     applicable accounting period.

1. Stock Based Compensation

> The Company accounts for stock based employee and director compensation
>     arrangements in accordance with provisions of Accounting Principles Board
>     ("APB") Opinion No. 25 - "Accounting for Stock Issued to Employees", and
>     related interpretations, and complies with the disclosure provisions of SFAS
>     No. 123 - "Accounting for Stock Based Compensation". Under APB No. 25,
>     compensation expense is based on the difference, if any, on the date the
>     number of shares receivable is determined, between the estimated fair value
>     of the Company's stock and the exercise price of options to purchase that
>     stock. Stock based compensation arrangements for others are recorded at
>     their fair value as the services are provided and the compensation earned.

1. Income Taxes

> The Company has adopted Statement of Financial Accounting Standards No.
>     109 - "Accounting for Income taxes" (SFAS 109). This standard requires the
>     use of an asset and liability approach for financial accounting, and
>     reporting on income taxes. If it is more likely than not that some portion
>     or all of a deferred tax asset will not be realized, a valuation allowance
>     is recognized.

1. Basic and Diluted Loss Per Share

> In accordance with SFAS No. 128 - "Earnings Per Share", the basic loss
>     per common share is computed by dividing net loss available to common
>     stockholders by the weighted average number of common shares outstanding.
>     Diluted loss per common share is computed similar to basic loss per common
>     share except that the denominator is increased to include the number of
>     additional common shares that would have been outstanding if the potential
>     common shares had been issued and if the additional common shares were
>     dilutive.





-10-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)





NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS



MAY 31, 2004

(Unaudited)

(Stated in U.S. Dollars)

3. SHARE SUBSCRIPTIONS RECEIVED

The Company has approved the private placement of 3,000,000 units at $2.00
per unit. Each unit will consist of one common share and one warrant to purchase
an additional common share at $3.00 for a period of eighteen months. As at May
31, 2004, $20,000 had been advanced in connection with this private placement.
The Company has ceased financing under the private placement and intends to
treat the funds received as a loan.

4. STOCK OPTION PLAN

During the year ended August 31, 2003, the Company adopted a stock option
plan (the "Plan") pursuant to which the directors may grant a maximum of
8,681,250 common stock options to officers, key employees and consultants. The
Company granted 8,681,250 fully vested incentive stock options allowing the
holders to purchase one common share of the Company at $0.50 per share for a
term expiring September 9, 2004.

The following is a summary of the stock option activity during the period:



|                                 | NUMBER
    OF
    SHARES | WEIGHTED
    AVERAGE
    EXERCISE
    PRICE
|-------------------------------- | ------------------------ | -------------------------------------------
|                                 |                          |                                            
|Outstanding, August
    31, 2003 | 2,807,500                | $                                          
|                                 |                          |                                            
|Granted                          | -                        |                                            
|Exercised                        | -                        |                                            
|Expired/Lapsed                   | (682,500)                |                                            
|                                 |                          |                                            
|Outstanding, May 31, 2004        | 2,125,000                | $                                          





5. RELATED PARTY TRANSACTIONS

During the period ended May 31, 2004, the Company incurred consulting
expenses of $Nil (2003 - $146,147) to directors and officers.

As at May 31, 2004, the Company has $20,850 (2003 - $6,095) in accounts
payable owing to a former director and officer.





-11-

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PAN AMERICAN ENERGY CORP.

(Formerly August Biomedical Corporation)

(A Development Stage Company)





NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS



MAY 31, 2004

(Unaudited)

(Stated in U.S. Dollars)

6. CONTINGENCIES

> i) The Company is subject to a legal action being brought against it, in the
> Supreme Court of British Columbia, by a former director and officer for wrongful
> dismissal and breach of contract. Management is of the opinion that the amount
> of the claim, if any, is not determinable and, accordingly, no provision has
> been recorded in the accounts at May 31, 2004.
> ii) The Company is subject to a legal action being brought against it in the
> Supreme Court of British Columbia, in respect of a Memorandum of Understanding
> and a Share Purchase Agreement. Management is or the opinion that the amount of
> the claim, if any, is not determinable and, accordingly, no provision has been
> recorded in the accounts at May 31, 2004.

7. TERMINATED AGREEMENT

On December 15, 2003, and amended, the Company entered into an agreement to
acquire a 100% working interest (82.5% net revenue interest) in certain oil and
gas leases located in Yellowstone Counties, Montana, U.S.A. The purchase price
was $185,366 payable as follows:

> a) a non-refundable deposit of $20,000 on execution of the Agreement and
> b) $165,366 due by March 15, 2004, (subject to satisfactory due diligence by
> the Company).

The Company completed its due diligence and management concluded not to
proceed further with the acquisition on April 7, 2004, the agreement was
terminated by both parties.

8. RESTATEMENT OF FINANCIAL STATEMENTS

The consolidated financial statements for the year ended August 31, 2003 have
been restated to give effect to the application of SFAS No. 123 in accounting
for the fair value of the options granted during the period to consultants. The
prior period adjustment results in an increase in stock-based compensation
expense of $2,535,812 in the consolidated statement of operations and an
increase in additional paid-in capital of $2,535,812 in the consolidated balance
sheet.



-12-

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Item 2. Management's Discussion and Analysis or Plan of Operations



FORWARD-LOOKING STATEMENTS

The information in this Quarterly Report on Form 10-QSB contains
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. These forward-looking statements involve risks and uncertainties,
including statements regarding Pan American Energy Corp.'s (August Biomedical)
capital needs, business plans and expectations. Such forward-looking statements
involve risks and uncertainties regarding the market price of natural resources,
availability of funds, government regulations, common share prices, operating
costs, capital costs and other factors. Forward-looking statements are made,
without limitation, in relation to operating plans, property exploration and
development, availability of funds and operating costs. Any statements contained
herein that are not statements of historical facts may be deemed to be
forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "may", "will", "should", "expect", "plan",
"intend", "anticipate", "believe", "estimate", "predict", "potential" or
"continue", the negative of such terms or other comparable terminology. Actual
events or results may differ materially. In evaluating these statements, you
should consider various factors, including the risks outlined below, and, from
time to time, in other reports August Biomedical files with the SEC, including
Pan American's Annual Report on Form 10-KSB for the year ended August 31, 2003.
These factors may cause Pan American's actual results to differ materially from
any forward-looking statement. Pan American disclaims any obligation to publicly
update these statements, or disclose any difference between its actual results
and those reflected in these statements. The information constitutes
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Given these uncertainties, readers are cautioned
not to place undue reliance on such forward-looking statements.

Overview

We were incorporated on May 26, 2000, under the laws of the State of Nevada
under the name Coyote Ventures Corp. On December 31, 2002, we changed our name
from Coyote Ventures Corp. to August Biomedical Corporation, on March 22, 2004
we changed our name from August Biomedical Corporation to Pan American Energy
Corp.

Plan of Operations

Pan American entered into an agreement dated December 15, 2003 with Zone
Exploration, Inc. and Mr. John Fredlund whereby Pan American acquired the right
to purchase certain oil and gas leases comprising the Horizontal Amsden Play in
Musselshell and Yellowstone Counties, Montana. This transaction was subject to
completion of due diligence and obtaining financing. Pan American was unable to
secure the necessary financing to close this agreement and the agreement was
subsequently terminated by Zone Exploration, Inc. on April 7, 2004.

On May 10, 2004, Pan American entered into a merger agreement with Morgan
which was expected to complete by July 26, 2004 and is now expected to complete
in early August 2004. On completion of the merger the former stockholders of
Morgan will own approximately 17.72% of Pan American. This percentage of
ownership will increase to 32.5% of Pan American on the cancellation of shares
held by certain stockholders who have agreed to cancel their shares concurrent
or shortly after closing this transaction. The board of directors of Morgan
immediately prior to the merger will be the directors of Pan American and the
current board of directors of Pan American will resign. Pan American will change
its name to "Morgan Beaumont, Inc." and the business, assets, and liabilities of
Morgan will become the business, assets and liabilities of Pan American. The
articles and bylaws of Pan American will remain the articles and bylaws of the
merged company.

Pan American's Cash Needs. At the present time Pan American cannot
satisfy its immediate cash requirements. At May 31, 2004, Pan American had
current liabilities of $122,851 and no cash on hand. Further, Pan American's
cash needs will be the cash needs of Morgan on closing of the Merger as Morgan
will be merged into Pan American. In order to undertake the proposed business
plans of Morgan, Pan American will need to raise significant capital. Pan
American will seek to obtain such financing through borrowing or sale of its
equity shares. At the present time Pan American does not have any debt or equity
financing arranged and there is no assurance that any will be available.
Accordingly, there is a significant risk that Pan American will not be able to
complete its business plan.

-13-

---

Pan American will also require funding for general corporate purposes
including legal, audit and administrative expenses. Pan American estimates that
at least $100,000 will be required for such purposes during the next 12 months.
At the present time, Pan American does not have any funding available to meet
such expenses and will need to obtain loans or sell equity shares to continue to
meet its filing obligations. There is no assurance that such funding will be
available to Pan American.

Employees. Pan American does not presently have any employees other than
its two executive officers. The employees of Morgan will become the employees of
Pan American on close of the Merger. If the Merger does not close, Pan American
does not anticipate having any employees within the next 12 months.

Results of Operations for Period Ending May 31, 2004

We did not earn any revenues during the period ending May 31, 2004. We are
presently in the development stage of our business and were unsuccessful in
closing our agreement with Zone Exploration Inc. and the agreement was
terminated on April 7, 2004. Although we have since entered into a merger
agreement with Morgan Beaumont, Inc., we can provide no assurance that we will
complete the acquisition of a this new business entity or any other entity, or
if such acquisition is completed, that we will proceed with the planned
expenditures.

We incurred expenses in the amount of $30,151 for the three months ended May
31, 2004, compared to $288,000 for the three months ended May 31, 2003. The
expenses incurred during this quarter were primarily accounting and legal
professional fees in the amount of $24,474 and office and sundry expenditures in
the amount of $329. We anticipate our operating expenses will increase if we
acquire or enter into a new line of business. The expenses incurred in 2004
reflected a $200,000 payment for certain patent acquisitions which were
subsequently reversed.

We incurred a loss in the amount of $42,790 for the nine months ended May 31,
2004, compared to $3,071,713 for the nine months ended May 31, 2003. Our losses
during the three month period ended May 31, 2004 was attributable primarily to
professional fee expenses. Our lose for the nine month period ended May 31, 2004
relates directly to the stock based compensation expense recorded on issue of
stock options granted to employees, officers and directors at less than market
value of the Company's common stock.

Liquidity and Capital Resources

We had cash on hand of $0 as at May 31, 2004 compared to $3,489 as at May 31,
2003. We had a accumulated deficit of $ ( 3,204,399 ) as at May 31, 2004 compared
to a accumulated deficit of $ (3,161,609) as at August 31, 2003.

We have not attained profitable operations and are dependent upon obtaining
financing to pursue our plan of operations. For these reasons, there is
substantial doubt that we will be able to continue as a going concern.

Stock-Based Compensation Expense

The Pan American stock options that were granted during fiscal 2003 were
granted at less than market value of the Company's common stock with a total
intrinsic value, being the excess of the quoted market price of the common stock
over the exercise price at the date the options are granted, of $ 434,062 . In
addition, the options granted to consultants are subject to fair value
accounting in accordance with FIN 44 resulting in additional compensation
expense as at August 31, 2003 of $ 2,101,750. The options were granted have been
accounted for as required by SFAS No. 123 by applying the fair value method
using the Black-Scholes option pricing model assuming a dividend yield of 0%, a
risk-free interest rate of 1.72%, expected option life of one years and an
expected volatility of 137%, resulting in additional compensation expense of
$2,101,750. The fair value of options granted to directors and officers was
$329,000. Note 1(g) and 8 of the unaudited financial statements for the period
ended May 31, 2004 and Note 2(g)the revised August 31, 2003 and 2002 audited
consolidated financial statements explains in detail the accounting for stock
based compensation.

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Off-Balance Sheet Arrangements

Pan American does not have any significant off-balance sheet arrangements
that have or are reasonably likely to have a current or future effect on its
financial condition, changes in financial condition, revenues or expenses,
results of operations, liquidity, capital expenditures or capital resources that
is material to its stockholders.

Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure

Pan American has had no disagreements with its accountants on accounting or
financial disclosures.

ITEM 3.     CONTROLS AND PROCEDURES.

As required by Rule 13a-15 under the Securities Exchange Act of 1934 (the
"Exchange Act"), we carried out an evaluation of the effectiveness of the design
and operation of our disclosure controls and procedures as of May 31, 2004,
being the date of our most recently completed fiscal quarter. This evaluation
was carried out under the supervision and with the participation of our Chief
Executive Officer, Scott C. Houghton, and Chief Financial Officer, Korina
Houghton. Based upon that evaluation, our Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and procedures are
effective in timely alerting management to material information relating to us
required to be included in our periodic SEC filings. There have been no
significant changes in our internal controls or in other factors that could
significantly affect internal controls subsequent to the date we carried out our
evaluation.

Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in our reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Securities and Exchange
Commission's rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed in our reports filed under the Exchange Act is
accumulated and communicated to management, including our Chief Executive
Officer and Chief Financial Officer, to allow timely decisions regarding
required disclosure.

During our most recently completed fiscal quarter ended May 31, 2004, there
were no changes in our internal control over financial reporting that have
materially affected, or are reasonably likely to affect, our internal control
over financial reporting.

The term "internal control over financial reporting" is defined as a process
designed by, or under the supervision of, the registrant's principal executive
and principal financial officers, or persons performing similar functions, and
effected by the registrant's board of directors, management and other personnel,
to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles and includes those policies and
procedures that:

(1)
    Pertain to the maintenance of
    records that in reasonable detail accurately and fairly reflect the
    transactions and dispositions of the assets of the registrant;(2)
    Provide reasonable assurance
    that transactions are recorded as necessary to permit preparation of
    financial statements in accordance with generally accepted accounting
    principles, and that receipts and expenditures of the registrant are being
    made only in accordance with authorizations of management and directors of
    the registrant; and(3)
    Provide reasonable assurance
    regarding prevention or timely detection of unauthorized acquisition, use or
    disposition of the registrant's assets that could have a material effect on
    the financial statements.


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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

Claim by Peter Whitehead

Pan American and its August Research Corp, were subject to a legal proceeding
commenced in the Supreme Court of British Columbia on July 24, 2003 by Peter
Whitehead, a former director and officer of Pan American. Mr. Whitehead has
since abandoned his claims against Pan American and the parties have provided
each other with a mutual release settling this matter.

Claim by iCyberdata Technology Inc.

During our second quarter ended May 31 , 2004, iCyberdata commenced legal
action against Pan American in respect of a memorandum of undertaking (the "MOI")
dated July 24, 2003 and a share purchase agreement dated September 30, 2003 (the
"Share Purchase Agreement"). Pan American was contemplating the purchase of the
shares of iCyberdata from the shareholders of iCyberdata. In furtherance of the
proposed purchase, Pan American entered into the MOI and executed a copy of the
Share Purchase Agreement. Pan American takes the position that the MOI was
intended to be a non-binding letter of intent only and that the Share Purchase
Agreement entered into by Pan American was not to be binding on the company
until it was executed by the shareholders of iCyberdata and its final form was
approved by Pan American's legal counsel neither of which events ever occurred.
iCyberdata, by letter dated October 29, 2003 claimed to terminate the Agreement
and has demanded $75,000 from Pan American under the terms of the alleged
agreement. In subsequent correspondence iCyberdata continues to allege that Pan
American was required to advance them $10,000 per month in respect of the
alleged agreement terminated by their letter of October 29, 2003. Pan American
and iCyberdata are currently finalizing a non-cash settlement of this matter at
which time the parties will provide a mutual release of any and all potential
claims.

Item 2. Changes in Securities

Private Placement. In December 2002, Pan American raised $20,000 by
selling 10,000 units at $2.00 per unit to two subscribers. Each unit was to
consist of one common share and one warrant to purchase an additional common
share at $3.00 for a period of eighteen months. Pan American never issued these
subscribers their securities under this financing. Pan American and these two
subscribers are now in the process of completing documentation to rescind the
sale of these shares which the company expects to complete in July 2004.

Stock Options Exercised. No stock options were exercised during the
period ended May 31, 2004.

Stock Options Issued. No stock options were issued during the year ended
May 31, 2004.

Item 3. Defaults upon Senior Securities

None

Item 4. Submission of Matters to a Vote of Security Holders

On May 10 , 2004, a majority of our security holders voted affirmatively for
the following:



| | 1. | a .66956 for one
    reverse split of the issued and outstanding shares of common stock;                                                                                                                 
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2. | the amendment of the
    Articles of Incorporation to:                                                                                                                                                   
| |    | a.                                                                                                                                                                                                       
| |    | b.                                                                                                                                                                                                       
| |    |                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                          
| | 3. | the change of
    business of Pan American from oil and gas exploration and development to the
    business of Morgan Beaumont, Inc;                                                                     
| | 4. | To elect five
    persons to Pan American's Board of Directors to serve until the next annual
    general meeting of stockholders and until their respective successors are
    elected or appointed; and
| | 5. | a .66956 for one
    reverse split of the issued and outstanding shares of common stock.                                                                                                                 



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The Board of Directors of Pan American has since decided not to proceed with
the reverse split approved on May 10, 2004. The Merger Agreement between the
parties is in the process of being amended accordingly.

These changes were to take effect on July 26, 2004, which is twenty one days
after our mail-out of our definitive information circular to our stockholders of
record on April 15, 2004. The parties, however, have decided to post-pone these
changes and the closing of the Merger until Pan American is able to file certain
restated financial statements. The parties now expect the Merger to close
sometime in early August.

Item 5. Other Information

Agreement with Zone Exploration Cancelled. 
We received a notice of default from Zone Exploration Inc. ("Zone") on March 16,
2004 for failure to make one of the required payments under the Agreement for
Sale and Purchase Agreement dated December 15, 2003 between the parties (the
"Agreement"). Under the Agreement we had fourteen days from the date of notice
to cure the default by tendering to Zone the exercise payment of US$ 165,366. We
received a letter of termination from Zone on April 7, 2004. Our Board of
Directors believes the termination of the Agreement is in our best interest at
this time.

Proposed Merger with Morgan Beaumont, Inc.

Pan American and Morgan have entered into a Merger Agreement which provides
that subject to the meeting of certain conditions, Pan American will issue an
aggregate total of thirteen-million (13,000,000) shares of common stock with a
restrictive legend for all of the shares of Morgan currently held by the Morgan
stockholders. After the closing of the Merger, Morgan will cease to exist and
the business of Morgan will be the business of Pan American and 17.72 % of the
ownership of Pan American will be controlled by the former shareholders of
Morgan based on the 60,325,000 shares of common stock of Pan American issued and
outstanding at the time of signing the Merger Agreement by the parties.

Certain stockholders as part of the Merger Agreement have agreed to cancel
their shares of common stock held in Pan American reducing the existing Pan
American stockholder's issued and outstanding stock position to 27,000,0000
shares.

On completion of the Merger and share cancellations, the ownership of the
common stock by the current shareholders of Morgan, as a group; and the current
Pan American shareholders as a group is estimated to be as follows:



Groups of Stockholders
    Common Stock
    % OwnedMorgan Stockholders
    13,000,000
    32.5%Pan American Stockholders
    27,000,000
    67.5%TOTAL OF ALL STOCKHOLDERS
    40,000,000
    100.0%




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The foregoing table includes does not include all the shares of common stock
which are or become issuable on the exercise of any stock options or warrants
which may be outstanding at time of the Closing.

Conditions for Closing. The obligation of each of the parties to
consummate the Merger is subject to the following conditions, among others:

- currency of all of Pan American's reports required to be filed under the
  Securities Exchange Act of 1934, as amended;
- approval of the name change, reverse split and appointment of directors by
  the holders of common stock of Pan American;
- Pan American entering into employment agreements with certain key
  individuals;
- the issuance of 13,000,000 shares of common stock of Pan American for all
  the shares of common stock of Morgan;
- no injunction or litigation commenced regarding the Merger;
- the resignation of the current directors and officers of Pan American and
  Morgan;
- the appointment of the current Board of Directors of Morgan as the new
  directors of Pan American;
- Pan American's share capital being approximately 27,000,000 shares of
  common stock at the time of the Closing;
- Pan American having no undisclosed liabilities at Closing the Merger; and
- the approval of the Merger Agreement by at least 65% of the holders of
  common stock of Morgan.

Closing. The closing of the Merger was expected to take place on July 26,
2004. The parties, however, decided to postpone this closing until Pan American
had filed its restated financial statements for August 31, 2003 and its amended
financial statements for the quarter ended May 31, 2004. The parties expect the
closing of the Merger to take place some time in early August 2004 after these
matters have been resolved.Regulatory Approvals. No approvals by any governmental authority are
required in order to complete the Merger.

Related Transactions to Merger with Morgan
Beaumont, Inc.

Employment Agreements. In connection with the Merger Agreement, Pan
American has agreed to assume the employment agreements that Morgan currently
has with Messrs. Don Craig; Ken Craig; Erik Jensen; Gary Gealy; James Smith,
III; Rod Braido; Clifford Wildes and Ms. Linda Sheppard. Each agreement becomes
effective on the Closing of the Merger. The terms of the employment agreements
are set out in more detail under "Election of Directors - Executive
Compensation" in this Information Statement.

Cancellation of Stock. As part of the Merger, two stockholders have
agreed to cancel approximately 33,325,000 shares of common stock they currently
hold in Pan American on the Closing of the Merger. These shares will not be
cancelled if the Merger fails to close.

Item 6. Exhibits and Reports on Form 8-K.

EXHIBITS REQUIRED BY ITEM 601 OF FORM 8-K

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Exhibit Number
    
    Description of Exhibit31. 1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002 (1)31. 2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002 (1)32. 1
    
    Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,
    as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (1)32. 2
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350,
    as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (1)


(1)
    Filed as an Exhibit to this
    Quarterly Report on Form 10-QSB.


REPORTS ON FORM 8-K

We have not filed any Current Reports on Form 8-K during our fiscal quarter
ended May 31, 2004.

SIGNATURES

In accordance with the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

PAN AMERICAN
    ENERGY CORP.Date: July 28 , 2004
    By:
    /s/ Scott HoughtonScott C. Houghton, President,Chief Executive Officer andDirector






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