**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

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**FORM      10-QSB**

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| (Mark                One) |   |                                                                                                                                  |
|---------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------|
| x                         |   | Quarterly                report pursuant to Section 13 or 15(d) of the Securities Exchange                Act of                1934  |
|                      |   | **For                the quarterly period ended: March 31, 2008**                                                                     |
|                      |   |                                                                                                                                  |
|                      |   | **or**                                                                                                                                |
| o                         |   | Transition                report pursuant to Section 13 or 15(d) of the Securities Exchange                Act of                1934 |
|                      |   | For                the transition period from     to                                                         |

**Commission        file number 0-31423**

**FRIENDLY      ENERGY EXPLORATION**

|                                                          |   |                                                |
|---------------------------------------------------------------|--------|-----------------------------------------------------|
| **Nevada**                                                    |   | **91-1832462**                                      |
| (State                of incorporation)                       |   | (I.R.S.                employer identification no.) |
|                                                          |
| **502                North Division Street, Carson City, NV** |   | **89703**                                           |
| (Address                of principal executive offices)       |   | (Zip                code)                           |

**702-953-0411**

----

**PART      I - FINANCIAL INFORMATION**

**ITEM      1. FINANCIAL STATEMENTS**

|                                                                  |   | March                  31, 2008 |       | December                  31, 2007 |   |
|-----------------------------------------------------------------------|--------|---------------------------------|------------|------------------------------------|--------|
|                                                                  |   |                            |       | (Restated)                         |   |
|                                                                  |   |                            |       |                               |   |
| ASSETS                                                                |   |
|                                                                  |   |                            |       |                               |   |
| Current                  assets                                       |   |                            |       |                               |   |
| Cash                  and cash equivalents                            |   | $                               | 124        |                               | $      | 268 |   |
| Advances                                                              |   |                            | 264        |                               |   | 360 |   |
| Total                  current assets                            |   |                            | 388        |                               |   | 628 |   |
|                                                                  |   |                            |       |                               |   |   |   |
| Other                  Assets                                         |   |                            |       |                               |   |   |   |
| Property                  and equipment, net                          |   |                            | 2,261      |                               |   | 2,466 |   |
| Investment                                                            |   |                            | 1,000      |                               |   | 1,000 |   |
| Notes                                                                 |   |                            | 319,000    |                               |   | 319,000 |   |
| Asher                  #1 Oil Well                                    |   |                            | 103,077    |                               |   | 103,077 |   |
| Asher                  #2 Project                                     |   |                            | 5,008      |                               |   | 5,008 |   |
| West                  Peach Project                                   |   |                            | 52,005     |                               |   | 52,005 |   |
| Total                  Other Assets                              |   |                            | 482,351    |                               |   | 482,556 |   |
|                                                                  |   |                            |       |                               |   |   |   |
| Total                  Assets                                         |   | $                               | 482,739    |                               | $      | 483,184 |   |
|                                                                  |   |                            |       |                               |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' DEFICIT                |   |
|                                                                  |   |                            |       |                               |   |   |   |
| LIABILITIES                                                           |   |                            |       |                               |   |   |   |
| Current                  liabilities                                  |   |                            |       |                               |   |   |   |
| Accounts                  Payable                                     |   | $                               | 157,146    |                               | $      | 158,419 |   |
| Payroll                  Tax Liabilities                              |   |                            | 87,675     |                               |   | 83,085 |   |
| Judgement                  payable                                    |   |                            | 201,017    |                               |   | 196,074 |   |
| Deferred                  Salaries                                    |   |                            | 408,000    |                               |   | 348,000 |   |
| Interest                  Payable                                     |   |                            | 156,302    |                               |   | 143,710 |   |
| Loan                  Payable                                         |   |                            | 52,113     |                               |   | 51,569 |   |
| Loans                  Payable-Related Parties                        |   |                            | 8,830      |                               |   | 7,086 |   |
| Total                  current liabilities                       |   |                            | 1,071,083  |                               |   | 987,943 |   |
|                                                                  |   |                            |       |                               |   |   |   |
| Total                  liabilities                               |   |                            | 1,071,083  |                               |   | 987,943 |   |
|                                                                  |   |                            |       |                               |   |   |   |
| STOCKHOLDERS'                  DEFICIT                                |   |                            |       |                               |   |   |   |
| Common                  stock, $0.001 par value; 100,000,000 shares   |   |                            |       |                               |   |   |   |
| authorized,                  2,783,250 and 2,782,271 shares,     |   |                            |       |                               |   |   |   |
| respectively,                  issued and outstanding            |   |                            | 2,783      |                               |   | 2,782 |   |
| Preferred                  Stock, $0.001 par value, 10,000,000 shares |   |                            |       |                               |   |   |   |
| authorized,                  9,545,856 and 9,545,856 shares,     |   |                            | 9,546      |                               |   | 9,546 |   |
| respectively,                  issued and outstanding            |   |                            |       |                               |   |   |   |
| Additional                  paid-in capital                           |   |                            | 3,684,600  |                               |   | 3,684,601 |   |
| Accumulated                  deficit in the development stage         |   |                            | (4,285,274 | )                                  |   | (4,201,688 | ) |
| Total                  stockholders' deficit                     |   |                            | (588,345   | )                                  |   | (504,759 | ) |
|                                                                  |   |                            |       |                               |   |   |   |
| Total                  liabilities and stockholders' deficit     |   | $                               | 482,738    |                               | $      | 483,184 |   |

----

|                                                            |   |                                  |      |                                  |   | From                    Inception    |   |
|-----------------------------------------------------------------|--------|---------------------------------------|-----------|---------------------------------------|--------|--------------------------------------|--------|
|                                                            |   | For                    the            |      | For                    the            |   | (January                    7, 1993) |   |
|                                                            |   | Three                    Months Ended |      | Three                    Months Ended |   | through                              |   |
|                                                            |   | March                    31, 2008     |      | March                    31, 2007     |   | March                    31, 2008    |   |
|                                                            |   |                                  |      | (Restated)                            |   | (Restated)                           |   |
|                                                            |   |                                  |      |                                  |   |                                 |   |
| Revenue                                                         |   | $                                     | 5,035     |                                  | $      | -                                    |   | $ | 16,053 |   |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
| Operating                    expenses                           |   |                                  |      |                                  |   |                                 |   |   |   |   |
| Amortization                    Expense                    |   |                                  | -         |                                  |   | -                                    |   |   | 30,000 |   |
| Depreciation                                               |   |                                  | 206       |                                  |   | 300                                  |   |   | 43,568 |   |
| Dry                    Hole Cost                           |   |                                  | -         |                                  |   | 702                                  |   |   | 88,157 |   |
| Intangible                    Drilling Costs               |   |                                  | -         |                                  |   | 17,953                               |   |   | 333,206 |   |
| Legal                    Fees                              |   |                                  | 800       |                                  |   | 567                                  |   |   | 76,535 |   |
| Officer                    Wages                           |   |                                  | 60,000    |                                  |   | 61,000                               |   |   | 807,000 |   |
| Oil                    Well Operations Cost                |   |                                  | 3,157     |                                  |   | 1,321                                |   |   | 9,740 |   |
| Payroll                    Expenses                        |   |                                  | 4,590     |                                  |   | 3,978                                |   |   | 263,635 |   |
| Professional                    Fees                       |   |                                  | 1,310     |                                  |   | 336                                  |   |   | 571,111 |   |
| Rent                                                       |   |                                  | -         |                                  |   | -                                    |   |   | 237,406 |   |
| Stock                    Based Compensation                |   |                                  | -         |                                  |   | 46,742                               |   |   | 553,167 |   |
| Telephone                                                  |   |                                  | 142       |                                  |   | 2,574                                |   |   | 46,147 |   |
| Travel                    & Entertainment              |   |                                  | 569       |                                  |   | 1,155                                |   |   | 141,406 |   |
| General                    and administrative              |   |                                  | 312       |                                  |   | 413                                  |   |   | 177,517 |   |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
|  Total                    operating expenses               |   |                                  | 71,086    |                                  |   | 137,041                              |   |   | 3,378,595 |   |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
|  Loss                    from operations                   |   |                                  | (66,051   | )                                     |   | (137,041                             | )      |   | (3,362,542 | ) |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
| Other                    income (expenses):                     |   |                                  |      |                                  |   |                                 |   |   |   |   |
| Other                    income                            |   |                                  | -         |                                  |   | -                                    |   |   | 452 |   |
| Forgiveness                    of Debt                     |   |                                  | -         |                                  |   | -                                    |   |   | (122,765 | ) |
| Impairment                    Loss on Asset                |   |                                  | -         |                                  |   | -                                    |   |   | (442,800 | ) |
| Interest                    Expense                        |   |                                  | (17,535   | )                                     |   | (28,721                              | )      |   | (247,619 | ) |
| Lawsuit                    Judgement                       |   |                                  | -         |                                  |   | -                                    |   |   | (110,000 | ) |
|  Total                    other income (expenses)          |   |                                  | (17,535   | )                                     |   | (28,721                              | )      |   | (922,732 | ) |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
|  Loss                    before provision for income taxes |   |                                  | (83,586   | )                                     |   | (165,762                             | )      |   | (4,285,274 | ) |
| Provision                    for income taxes                   |   |                                  | -         |                                  |   | -                                    |   |   | - |   |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
|  Net                    loss                               |   | $                                     | (83,586   | )                                     | $      | (165,762                             | )      | $ | (4,285,274 | ) |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
| Basic                    and diluted loss per common share      |   | $                                     | (0.03     | )                                     | $      | (0.09                                | )      | $ | (6.35 | ) |
|                                                            |   |                                  |      |                                  |   |                                 |   |   |   |   |
| Basic                    and diluted weighted average           |   |                                  |      |                                  |   |                                 |   |   |   |   |
| common                    shares outstanding               |   |                                  | 2,782,347 |                                  |   | 1,751,978                            |   |   | 674,759 |   |

----

|                                                                                                              |   |                               |    |                             |   |    |   |        |     | Additional    |   |    |   | Total   |    |
|-------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|---------|----------------------------------|--------|---------|--------|-------------|----------|---------------|--------|---------|--------|---------|---------|
|                                                                                                              |   | Common                  Stock      |    | Preferred                  Stock |   | Paid-in |   | Accumulated |     | Stockholders' |   |
|                                                                                                              |   | Shares                  (Restated) |    | Amount                           |   | Shares  |   | Amount      |     | Capital       |   | Deficit |   | Deficit |    |
| Balance                  at January 7, 1993 (Date of inception)                                                   |   |                               | 0       |                             | $      | 0       |   |        | 0        |          | $      | 0       |   | $       | 0       |   | $ | 0 |   | $ | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares issued to officers & directors for cash,                  $0.016 per share     |   |                               | 2,550   |                             |   | 3       |   |        | 0        |          |   | 0       |   |    | 997     |   |   | 0 |   |   | 1,000 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Net                  loss                                                                                         |   |                               | 0       |                             |   | 0       |   |        | 0        |          |   | 0       |   |    | 0       |   |   | (1,000 | ) |   | (1,000 | ) |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Balance                  at December 31, 1993, 1994, and 1995                                                     |   |                               | 2,550   |                             |   | 3       |   |        | 0        |          |   | 0       |   |    | 997     |   |   | (1,000 | ) |   | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares cancelled                                                                          |   |                               | (2,550  | )                                |   | (3      | )      |        | 0        |          |   | 0       |   |    | 3       |   |   | 0 |   |   | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares issued for cash, $0.00 per share                                                   |   |                               | 100,000 |                             |   | 100     |   |        | 0        |          |   | 0       |   |    | (90     | ) |   | 0 |   |   | 10 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Conversion                  to preferred stock                                                                    |   |                               | (20,000 | )                                |   | (20     | )      |        | 50,000   |          |   | 50      |   |    | (30     | ) |   | 0 |   |   | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Net                  loss                                                                                         |   |                               | 0       |                             |   | 0       |   |        | 0        |          |   | 0       |   |    | 0       |   |   | (10 | ) |   | (10 | ) |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Balance                  at December 31, 1996                                                                     |   |                               | 80,000  |                             |   | 80      |   |        | 50,000   |          |   | 50      |   |    | 880     |   |   | (1,010 | ) |   | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares issued relating to spin-out                                                        |   |                               | 609     |                             |   | 1       |   |        | 0        |          |   | 0       |   |    | (1      | ) |   | 0 |   |   | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares issued for cash, $0.80 per share                                                   |   |                               | 1,500   |                             |   | 1       |   |        | 0        |          |   | 0       |   |    | 29,999  |   |   | 0 |   |   | 30,000 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares issued to officers and directors for                  cash, $0.685 per share       |   |                               | 1,750   |                             |   | 2       |   |        | 0        |          |   | 0       |   |    | 29,998  |   |   | 0 |   |   | 30,000 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Preferred                  shares issued to officers and directors for                  services, $0.04 per share |   |                               | 0       |                             |   | 0       |   |        | 750,000  |          |   | 750     |   |    | 29,250  |   |   | 0 |   |   | 30,000 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Net                  loss                                                                                         |   |                               | 0       |                             |   | 0       |   |        | 0        |          |   | 0       |   |    | 0       |   |   | (63,266 | ) |   | (63,266 | ) |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Balance                  at December 31, 1997                                                                     |   |                               | 83,859  |                             |   | 84      |   |        | 800,000  |          |   | 800     |   |    | 90,126  |   |   | (64,276 | ) |   | 26,734 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares issued for cash, $1.74 per share                                                   |   |                               | 390     |                             |   | 0       |   |        | 0        |          |   | 0       |   |    | 17,000  |   |   | 0 |   |   | 17,000 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Common                  shares issued to officers and directors for                  services, $0.004             |   |                               | 105,000 |                             |   | 105     |   |        | 0        |          |   | 0       |   |    | 10,395  |   |   |   |   |   | 10,500 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Conversion                  of preferred stock                                                                    |   |                               | 320,000 |                             |   | 320     |   |        | (800,000 | )             |   | (800    | )      |    | 480     |   |   | 0 |   |   | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Net                  loss                                                                                         |   |                               | 0       |                             |   | 0       |   |        | 0        |          |   | 0       |   |    | 0       |   |   | (33,234 | ) |   | (33,234 | ) |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Balance                  at December 31, 1998                                                                     |   |                               | 509,249 |                             |   | 509     |   |        | 0        |          |   | 0       |   |    | 118,001 |   |   | (97,510 | ) |   | 21,000 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Cancellation                  of common stock                                                                     |   |                               | (1,850  | )                                |   | (2      | )      |        | 0        |          |   | 0       |   |    | 2       |   |   | 0 |   |   | 0 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Preferred                  shares issued for debt settlement, $3.69 per                  share                    |   |                               | 0       |                             |   | 0       |   |        | 146,883  |          |   | 147     |   |    | 541,853 |   |   | 0 |   |   | 542,000 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Preferred                  shares issued for services, $3.69 per share                                            |   |                               | 0       |                             |   | 0       |   |        | 5,000    |          |   | 5       |   |    | 18,445  |   |   | 0 |   |   | 18,450 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Net                  loss                                                                                         |   |                               | 0       |                             |   | 0       |   |        | 0        |          |   | 0       |   |    | 0       |   |   | (556,309 | ) |   | (556,309 | ) |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Balance                  at December 31, 1999                                                                     |   |                               | 507,399 |                             |   | 507     |   |        | 151,883  |          |   | 152     |   |    | 678,301 |   |   | (653,819 | ) |   | 25,141 |   |
|                                                                                                              |   |                               |    |                             |   |    |   |        |     |          |   |    |   |    |    |   |   |   |   |   |   |   |
| Preferred                  shares issued for debt settlement, $3.69 per                  share                    |   |                               | 0       |                             |   | 0       |   |        | 174,798  |          |   | 175     |   |    | 644,825 |   |   | 0 |   |   | 645,000 |   |

----

|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       | Additional    |   |    |   | Total   |      |
|---------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|-----------|----------------------------------|--------|---------|--------|-------------|------------|---------------|--------|---------|--------|---------|-----------|
|                                                                                                                                        |   | Common                  Stock      |      | Preferred                  Stock |   | Paid-in |   | Accumulated |       | Stockholders' |   |
|                                                                                                                                        |   | Shares                  (Restated) |      | Amount                           |   | Shares  |   | Amount      |       | Capital       |   | Deficit |   | Deficit |      |
| Issuance                  of stock related to merger with Friendly Energy Services, Inc.,                  $3.69 per                  share |   |                               | 0         |                             |   | 0       |   |        | 120,000    |          |   | 120     |   |    | 442,680   |   |   | 0 |   |   | 442,800 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Preferred                  shares issued for services, $3.69 per share                                                                      |   |                               | 0         |                             |   | 0       |   |        | 37,500     |          |   | 37      |   |    | 138,338   |   |   | 0 |   |   | 138,375 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  loss                                                                                                                   |   |                               | 0         |                             |   | 0       |   |        | 0          |          |   | 0       |   |    | 0         |   |   | (914,511 | ) |   | (914,511 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance                  at December 31, 2000                                                                                               |   |                               | 507,399   |                             |   | 507     |   |        | 484,181    |          |   | 484     |   |    | 1,904,144 |   |   | (1,568,330 | ) |   | 336,805 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  loss                                                                                                                   |   |                               | 0         |                             |   | 0       |   |        | 0          |          |   | 0       |   |    | 0         |   |   | (584,851 | ) |   | (584,851 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance                  at December 31, 2001                                                                                               |   |                               | 507,399   |                             |   | 507     |   |        | 484,181    |          |   | 484     |   |    | 1,904,144 |   |   | (2,153,181 | ) |   | (248,046 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Preferred                  shares issued for debt settlement, $3.69 per share                                                               |   |                               | 0         |                             |   | 0       |   |        | 2,973,080  |          |   | 2,973   |   |    | 145,681   |   |   | 0 |   |   | 148,654 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  loss                                                                                                                   |   |                               | 0         |                             |   | 0       |   |        | 0          |          |   | 0       |   |    | 0         |   |   | (12,371 | ) |   | (12,371 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance                  at December 31, 2002                                                                                               |   |                               | 507,399   |                             |   | 507     |   |        | 3,457,261  |          |   | 3,457   |   |    | 2,049,825 |   |   | (2,165,552 | ) |   | (111,763 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  loss                                                                                                                   |   |                               | 0         |                             |   | 0       |   |        | -          |          |   | 0       |   |    | 0         |   |   | (24,215 | ) |   | (24,215 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance,                  December 31, 2003                                                                                                 |   |                               | 507,399   |                             |   | 507     |   |        | 3,457,261  |          |   | 3,457   |   |    | 2,049,825 |   |   | (2,189,767 | ) |   | (135,978 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  loss                                                                                                                   |   |                               | 0         |                             |   | 0       |   |        | 0          |          |   | 0       |   |    | 0         |   |   | (11,795 | ) |   | (11,795 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance,                  December 31, 2004                                                                                                 |   |                               | 507,399   |                             |   | 507     |   |        | 3,457,261  |          |   | 3,457   |   |    | 2,049,825 |   |   | (2,201,562 | ) |   | (147,773 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued for cash, $0.025                                                                                      |   |                               | 16,000    |                             |   | 16      |   |        | 0          |          |   | 0       |   |    | 9,984     |   |   | 0 |   |   | 10,000 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued for servicees, $0.05 per share                                                                        |   |                               | 10,000    |                             |   | 10      |   |        | 0          |          |   | 0       |   |    | 12,490    |   |   | 0 |   |   | 12,500 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued to officers and directors for services, $0.04 per                  share                              |   |                               | 20,000    |                             |   | 20      |   |        | 0          |          |   | 0       |   |    | 19,980    |   |   | 0 |   |   | 20,000 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Preferred                  shares issued to officers and directors for services, $0.40 per                  share                           |   |                               | 0         |                             |   | 0       |   |        | 450,000    |          |   | 450     |   |    | 179,550   |   |   | 0 |   |   | 180,000 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Conversion                  of preferred stock                                                                                              |   |                               | 789,680   |                             |   | 790     |   |        | (1,974,200 | )             |   | (1,974  | )      |    | 1,185     |   |   | 0 |   |   | 0 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Issuance                  of stock options to two officers                                                                                  |   |                               | 0         |                             |   | 0       |   |        | 0          |          |   | 0       |   |    | 24,929    |   |   | 0 |   |   | 24,929 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  loss                                                                                                                   |   |                               | 0         |                             |   | 0       |   |        | -          |          |   | 0       |   |    | 0         |   |   | (691,271 | ) |   | (691,271 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance,                  December 31, 2005                                                                                                 |   |                               | 1,343,079 |                             | $      | 1,343   |   |        | 1,933,061  |          | $      | 1,933   |   | $       | 2,297,942 |   |   | ($2,892,833 | ) |   | ($591,615 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued for cash, $0.05                                                                                       |   |                               | 20,000    |                             |   | 20      |   |        | -          |          |   | -       |   |    | 24,980    |   |   |   |   |   | 25,000 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Conversion                  of preferred stock                                                                                              |   |                               | 380,677   |                             |   | 381     |   |        | (951,692   | )             |   | (952    | )      |    | 571       |   |   | - |   |   | - |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Issuance                  of stock options to 2 officers (2nd half vested)                                                                  |   |                               | -         |                             |   | -       |   |        | -          |          |   | -       |   |    | 24,929    |   |   | - |   |   | 24,929 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Preferred                  shares issued for debt settlement, $0.195 per share                                                              |   |                               | -         |                             |   | -       |   |        | 278,554    |          |   | 279     |   |    | 54,039    |   |   | - |   |   | 54,318 |   |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  Loss                                                                                                                   |   |                               | -         |                             |   | -       |   |        | -          |          |   | -       |   |    | -         |   |   | (824,586 | ) |   | (824,586 | ) |
|                                                                                                                                        |   |                               |      |                             |   |    |   |        |       |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance,                  December 31, 2006                                                                                                 |   |                               | 1,743,756 |                             |   | 1,744   |   |        | 1,259,923  |          |   | 1,260   |   |    | 2,402,461 |   |   | (3,717,419 | ) |   | (1,311,954 | ) |

----

|                                                                                                                               |   |                               |      |                             |   |    |   |        |      | Additional    |   |    |   | Total   |      |
|------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|-----------|----------------------------------|--------|---------|--------|-------------|-----------|---------------|--------|---------|--------|---------|-----------|
|                                                                                                                               |   | Common                  Stock      |      | Preferred                  Stock |   | Paid-in |   | Accumulated |      | Stockholders' |   |
|                                                                                                                               |   | Shares                  (Restated) |      | Amount                           |   | Shares  |   | Amount      |      | Capital       |   | Deficit |   | Deficit |      |
| Preferred                  shares issued for debt settlement, $0.090                  per share                                    |   |                               | -         |                             |   | -       |   |        | 5,222,222 |          |   | 5,222   |   |    | 464,778   |   |   | - |   |   | 470,000 |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued for notes $0.020                                                                             |   |                               | 732,000   |                             |   | 732     |   |        | -         |          |   | -       |   |    | 318,268   |   |   |   |   |   | 319,000 |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Issuance                  of stock options to 2 officers (vested)                                                                  |   |                               | -         |                             |   | -       |   |        | -         |          |   | -       |   |    | 93,484    |   |   | - |   |   | 93,484 |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued for cash, $0.05                                                                              |   |                               | 20,000    |                             |   | 20      |   |        | -         |          |   | -       |   |    | 24,980    |   |   |   |   |   | 25,000 |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued for cash, $0.025                                                                             |   |                               | 16,000    |                             |   | 16      |   |        | -         |          |   | -       |   |    | 9,964     |   |   |   |   |   | 9,980 |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Preferred                  shares issued to officers and directors for                  services, $0.10 per share                  |   |                               | -         |                             |   | -       |   |        | 3,740,000 |          |   | 3,740   |   |    | 370,260   |   |   | - |   |   | 374,000 |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Conversion                  of preferred stock                                                                                     |   |                               | 270,516   |                             |   | 271     |   |        | (676,289  | )             |   | (676    | )      |    | 406       |   |   | - |   |   | - |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  Loss                                                                                                          |   |                               | -         |                             |   | -       |   |        | -         |          |   | -       |   |    | -         |   |   | (484,269 | ) |   | (484,269 | ) |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance,                  December 31, 2007                                                                                        |   |                               | 2,782,271 |                             |   | 2,782   |   |        | 9,545,856 |          |   | 9,546   |   |    | 3,684,601 |   |   | (4,201,688 | ) |   | (504,759 | ) |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Common                  shares issued relating to reverse stock split                  (shareholders with less than 25 old shares) |   |                               | 979       |                             |   | 1       |   |        | -         |          |   | -       |   |    | (1        | ) |   | - |   |   | - |   |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Net                  Loss for the 3 mo. ended March 31, 2008                                                                       |   |                               | -         |                             |   | -       |   |        | -         |          |   | -       |   |    | -         |   |   | (83,586 | ) |   | (83,586 | ) |
|                                                                                                                               |   |                               |      |                             |   |    |   |        |      |          |   |    |   |    |      |   |   |   |   |   |   |   |
| Balance,                  March 31, 2008                                                                                           |   |                               | 2,783,250 |                             |   | 2,783   |   |        | 9,545,856 |          |   | 9,546   |   |    | 3,684,600 |   |   | (4,285,274 | ) |   | (588,345 | ) |

----

|                                                            |   |                              |    |                              |   | From                Inception    |   |
|-----------------------------------------------------------------|--------|-----------------------------------|---------|-----------------------------------|--------|----------------------------------|--------|
|                                                            |   | For                the            |    | For                the            |   | (January                7, 1993) |   |
|                                                            |   | Three                Months Ended |    | Three                Months Ended |   | through                          |   |
|                                                            |   | March                31, 2008     |    | March                31, 2007     |   | March                31, 2008    |   |
| Cash                flows from operating activities:            |   |                              |    |                              |   |                             |   |   |   |   |
| Net                loss                                         |   | $                                 | (83,586 | )                                 |   | (165,762                         | )      |   | (4,285,274 | ) |
| Adjustments                to reconcile net loss to             |   |                              |    |                              |   |                             |   |   |   |   |
| net                cash used by operating activities:           |   |                              |    |                              |   |                             |   |   |   |   |
| Depreciation                                                    |   |                              | 206     |                              |   | 300                              |   |   | 43,568 |   |
| Stock                Based Compensation                         |   |                              | -       |                              |   | -                                |   |   | 553,167 |   |
| Impairment                Loss                                  |   |                              | -       |                              |   | -                                |   |   | 442,800 |   |
| Changes                in operating assets and liabilities:     |   |                              |    |                              |   |                             |   |   | - |   |
| Accounts                Payable                                 |   |                              | (1,273  | )                                 |   | 39,188                           |   |   | 157,194 |   |
| Advances                                                        |   |                              | 97      |                              |   | -                                |   |   | (264 | ) |
| Judgement                payable                                |   |                              | 4,943   |                              |   | 4,474                            |   |   | 201,017 |   |
| Interest                Payable                                 |   |                              | 12,592  |                              |   | 24,247                           |   |   | 156,302 |   |
| Notes                                                           |   |                              | -       |                              |   | (198,000                         | )      |   | (319,000 | ) |
| Payroll                Liabilities                              |   |                              | 4,590   |                              |   | 3,978                            |   |   | 87,675 |   |
| Deferred                Salaries                                |   |                              | 60,000  |                              |   | 36,000                           |   |   | 408,000 |   |
| Loans                Payable                                    |   |                              | 544     |                              |   | (446,302                         | )      |   | 52,113 |   |
| Net                cash used by operating activities       |   |                              | (1,887  | )                                 |   | (701,877                         | )      |   | (2,502,702 | ) |
|                                                            |   |                              |    |                              |   |                             |   |   |   |   |
| Cash                flows from investing activities:            |   |                              |    |                              |   |                             |   |   |   |   |
| Purchase                of property and equipment               |   |                              | -       |                              |   | -                                |   |   | (45,828 | ) |
| Investment                                                      |   |                              | -       |                              |   | -                                |   |   | (1,000 | ) |
| Asher                #1 Oil Well                                |   |                              | -       |                              |   | -                                |   |   | (103,077 | ) |
| Asher                #2 Project                                 |   |                              | -       |                              |   | (5,008                           | )      |   | (5,008 | ) |
| West                Peach Project                               |   |                              | -       |                              |   | (15,035                          | )      |   | (52,005 | ) |
| Net                cash used by investing activities       |   |                              | -       |                              |   | (20,043                          | )      |   | (206,918 | ) |
|                                                            |   |                              |    |                              |   |                             |   |   |   |   |
| Cash                flows from financing activities:            |   |                              |    |                              |   |                             |   |   |   |   |
| Proceeds                from issuance of common stock           |   |                              | -       |                              |   | 249,742                          |   |   | 563,031 |   |
| Proceeds                from issuance of preferred stock        |   |                              | -       |                              |   | 470,000                          |   |   | 2,137,883 |   |
| Proceeds                on borrowings from related parties      |   |                              | 1,744   |                              |   | 1,492                            |   |   | 8,830 |   |
| Net                cash provided by financing activities   |   |                              | 1,744   |                              |   | 721,234                          |   |   | 2,709,744 |   |
|                                                            |   |                              |    |                              |   |                             |   |   |   |   |
| Net                increase in cash                             |   |                              | (143    | )                                 |   | (686                             | )      |   | 124 |   |
|                                                            |   |                              |    |                              |   |                             |   |   |   |   |
| Cash,                beginning of period                        |   |                              | 267     |                              |   | 747                              |   |   | - |   |
|                                                            |   |                              |    |                              |   |                             |   |   |   |   |
| Cash,                end of period                              |   | $                                 | 124     |                              | $      | 61                               |   | $ | 124 |   |

----

----

|                                                                    |   |                                        |    |                                        |   |
|-------------------------------------------------------------------------|--------|---------------------------------------------|---------|---------------------------------------------|--------|
|                                                                    |   | Three                      Months Ended2008 |    | Three                      Months Ended2007 |   |
| Furniture                      and fixtures                             |   | $                                           | 20,102  |                                        | $      | 20,102 |   |
| Computers                      and equipment                            |   |                                        | 25,726  |                                        |   | 25,726 |   |
|                                                                    |   |                                        | 45,828  |                                        |   | 45,828 |   |
| Less:                      accumulated depreciation                     |   |                                        | (43,567 | )                                           |   | (42,657 | ) |
| Net                      Furniture, fixtures, computers & equipment |   |                                        | 2,261   |                                        |   | 3,171 |   |
| LLC                      Investment                                     |   |                                        | 1,000   |                                        |   | 1,000 |   |
| West                      Peach Exploration Costs                       |   |                                        | 52,005  |                                        |   | 52,005 |   |
| Asher                      #1 Oil Well                                  |   |                                        | 103,077 |                                        |   | 103,077 |   |
| Asher                      #2 Exploration Costs                         |   |                                        | 5,008   |                                        |   | 5,008 |   |
| Total                      Fixed Assets                                 |   |                                        | 163,351 |                                        |   | 164,261 |   |

----

|                                                                                                                                                         |   | March                      31, 2008  |   |  March                      31, 2007 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|--------|-------------------------------------------|--------|
| Notes                      payable from officers of the                      Company bearing interest at 8% unsecured                      and due on demand |   | $                                         | 8,830  |                                      | $      | 8,165 |   |

**$**

----

7.              LITIGATION

----

**ITEM      2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF      OPERATIONS.**

**Our      Background**

**Our      Business**

**Our      Oil and Gas Properties **

**Asher      Prospect **

**West      Peach Creek Prospect **

**Liquidity      and Capital Resources.**

----

**Results      of Operations**

**Our      Plan of Operation for the Next Twelve Months**

**ITEM      3. CONTROLS AND PROCEDURES**

**Evaluation      Of Disclosure Controls And Procedures**

**Management's      Report On Internal Control Over Financial Reporting**

----

**PART      II - OTHER INFORMATION**

**ITEM      1. LEGAL PROCEEDINGS.**

**ITEM      2. UNREGISTERED SALES OF EQUITY SECURITIES.**

NONE

**ITEM      3. DEFAULTS UPON SENIOR SECURITIES.**

**ITEM      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.**

**ITEM      5. OTHER INFORMATION**

**ITEM      6. EXHIBITS AND REPORTS ON FORM 8-K**

**Reports      on Form 8-K**

**List      of Exhibits**

**SIGNATURES**

**FRIENDLY      ENERGY EXPLORATION**

----

----

----