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

                                   FORM 10-QSB


(Mark One)

[X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended   June 30, 2004
                                 --------------

[ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ______________ to _________________

                      Commission file number     0-32129
                                                 -------

                     Energy & Engine Technology Corporation
                     --------------------------------------
        (Exact name of small business issuer as specified in its charter)

               Nevada                       88-0471842
               ------                       ----------
(State or other jurisdiction of     (IRS Employer Identification No.
incorporation or organization)

                5308 West Plano Parkway, Plano, Texas  75093
                --------------------------------------------
                  (Address of principal executive offices)

                           (  972  ) 732-6360
                           ------------------
                       (Issuer's telephone number)

---------------------------------------------------------------------------
        (Former name, former address and former fiscal year,
                   if changed since last report)

Check whether the issuer (1) filed all reports to be filed by Section 13
or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes  X  No
                                                                   ---    ---

               APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be
filed by Section l2, 13 or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by a court. Yes [ ] No [ ]






                                        1

                    APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: 109,479,168 (as of August
12, 2004).

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X ]

                      PART I - FINANCIAL INFORMATION

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES


                                                                    CONTENTS
----------------------------------------------------------------------------
<TABLE>
<CAPTION>

                                                                       Page
                                                                       ----

<S>                                                                    <C>

Item 1. Financial Statements.                                           3-19

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

  Condensed Consolidated Balance Sheet                                   3-4
  Condensed Consolidated Statements of Operations                          5
  Condensed Consolidated Statements of Cash Flows                        6-7


NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)        8-19

Item 2.  Management's Discussion and Analysis or Plan of Operation     19-24

Item 3.  Controls and Procedures                                       24-25

                     PART II - OTHER INFORMATION

Item 1. Legal Proceedings                                                 25

Item 2. Changes in Securities                                          25-26

Item 3. Defaults upon Senior Securities                                   26

Item 4. Submission of Matters to a Vote of Security Holders               26

Item 5. Other Information                                                 26

Item 6. Exhibits and Reports on Form 8-K                               26-27

Signatures                                                                27

Exhibits                                                               28-31

</TABLE>

                                        2

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

                                        CONDENSED CONSOLIDATED BALANCE SHEET
                                                                 (UNAUDITED)

                                                              June 30, 2004
----------------------------------------------------------------------------
<TABLE>
<CAPTION>

                                   ASSETS
                                   ------
<S>                                                              <C>


CURRENT ASSETS
--------------
 Cash and cash equivalents                                    $   296,637
 Accounts receivable                                               26,520
 Inventory                                                        351,028
 Prepaid expenses and other current assets                        390,388
 Deposit on Asset Acquisition                                     813,648
                                                              -----------

   Total Current Assets                                         1,878,221

PROPERTY AND EQUIPMENT, Net                                       315,860
----------------------

OTHER ASSETS
------------
 Intangible assets, net                                            71,082
                                                              -----------

   TOTAL ASSETS                                               $ 2,265,163
                                                              ===========
</TABLE>

See accompanying Notes to the Condensed Consolidated Financial Statements.



















                                        3

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

                                        CONDENSED CONSOLIDATED BALANCE SHEET
                                                                 (UNAUDITED)

                                                              June 30, 2004
----------------------------------------------------------------------------
<TABLE>
<CAPTION>

                    LIABILITIES AND STOCKHOLDERS' EQUITY
                    ------------------------------------
<S>                                                             <C>
CURRENT LIABILITIES
-------------------
 Accounts Payable and accrued expenses                        $   346,270
 Accrued expenses officers                                        481,228
 Current maturities of note payable                                 8,076
 Notes payable, stockholders, net of debt discount
  of $61,580                                                      442,420
                                                              -----------

   Total Current Liabilities                                  $ 1,277,994


OTHER LIABILITIES
-----------------
 Note payable, less current maturities                             12,777
                                                              -----------

   TOTAL LIABILITIES                                            1,290,771


STOCKHOLDERS' EQUITY
--------------------
 Common stock, $.001 par value, 180,000,000 shares
  authorized, 109,154,674 shares issued and outstanding           109,154
 Additional paid-in capital                                    10,360,151
 Accumulated Deficiency                                        (9,486,580)
  Less: Deferred Compensation                                      (8,333)
                                                              -----------

   TOTAL STOCKHOLDERS' EQUITY                                     974,392
                                                              -----------


   TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                 $ 2,265,163
                                                              ===========
</TABLE>

See accompanying Notes to the Condensed Consolidated Financial Statements.







                                        4

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES
                             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                                                 (UNAUDITED)
           For the Three Months and Six Months Ended June 30, 2004 and 2003
----------------------------------------------------------------------------
<TABLE>
<CAPTION>

<S>                    <C>           <C>            <C>           <C>
                            THREE MONTHS ENDED            SIX MONTHS ENDED
                       JUNE 30, 2004 JUNE 30, 2003  JUNE 30, 2004 JUNE 30, 2003

NET SALES              $   111,926   $    50,966    $    220,831  $   109,056
---------

COST OF SALES               65,797        18,926         124,546       41,386
-------------
                       -----------   -----------    ------------  -----------

  GROSS PROFIT              46,129        32,040          96,285       67,670

OPERATING EXPENSES
------------------
 Selling, general
   and administrative
   expenses                389,559       343,214         750,327      682,993
Stock based
   compensation            103,125        26,750       1,800,640      133,100
                       -----------   -----------    ------------  -----------
  TOTAL OPERATING
   EXPENSES                492,684       369,964       2,550,967      816,093
                       -----------   -----------    ------------  -----------
  OPERATING LOSS          (446,555)     (337,924)     (2,454,682)    (748,423)
                       -----------   -----------    ------------  -----------
OTHER (EXPENSE)INCOME
---------------------
  Interest income              999            --           2,322           --
  Interest expense         (24,760)      (13,886)        (52,916)     (24,329)
                       -----------   -----------    ------------  -----------
  TOTAL OTHER EXPENSE      (23,761)      (13,886)        (50,594)     (24,329)
                       -----------   -----------    ------------  -----------
NET LOSS               $  (470,316)  $  (351,810)   $ (2,505,276) $  (772,752)
                       ===========   ===========    ============  ===========

NET LOSS PER COMMON SHARE:
-------------------------
  Basic and Diluted    $     (0.01)  $     (0.01)   $      (0.03) $     (0.03)
                       ===========   ===========    ============  ===========
WEIGHTED AVERAGE COMMON
-----------------------
  SHARES OUTSTANDING   104,819,060    26,011,169      96,739,265   25,193,035
                       ===========   ===========    ============  ===========
</TABLE>
See accompanying Notes to the Condensed Consolidated Financial Statements.



                                        5

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

                             CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                 (UNAUDITED)

                             For the Six Months Ended June 30, 2004 and 2003
----------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                          2004                      2003
                                   -----------------------------------------
<S>                                   <C>                        <C>
CASH FLOWS FROM OPERATING ACTIVITIES
------------------------------------
 Net loss                             $(2,505,276)               $ (772,752)
 Adjustments to reconcile net loss
  to net cash used in operating
  activities:
   Depreciation and amortization           26,007                    17,405
   Stock-based compensation             1,800,640                   133,100
   Amortization of debt discount           24,808                     6,830

 Changes in operating assets and
  liabilities:
   Accounts receivable                    (18,460)                   33,104
   Inventory                             (114,165)                  (10,552)
   Prepaid expenses and other
    current assets and deposit
    on asset acquisition                 (360,328)                 (108,611)
   Accounts payables and accrued
    expenses                             (157,620)                  100,740
   Accrued expenses, officers            (106,502)                  167,972
                                      -----------                ----------
     TOTAL ADJUSTMENTS                  1,094,380                   339,988
                                      -----------                ----------
     NET CASH USED IN OPERATING
      ACTIVITIES                       (1,410,896)                 (432,764)
                                      -----------                ----------
CASH FLOWS USED IN INVESTING ACTIVITIES
---------------------------------------
 Purchases of property and equipment      (36,711)                  (20,501)
                                      -----------                ----------
CASH FLOWS FROM FINANCING ACTIVITIES
------------------------------------
  (Repayment) Proceeds from notes
    payable, stockholders                  (5,000)                  239,941
Proceeds from notes payable net                --                    27,497
  Repayment of note payable                (3,278)                       --
  Proceeds from the issuance of
    common stock, net of offering
    costs                               1,745,498                   169,409
                                      -----------                ----------
     NET CASH PROVIDED BY FINANCING
      ACTIVITIES                      $ 1,737,220               $   436,847
                                      -----------               -----------
</TABLE>

See accompanying Notes to the Condensed Consolidated Financial Statements.
                                        6

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS, continued
                                                                 (UNAUDITED)

                            For the Six Months Ended June 30, 2004 and 2003
----------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                          2004                      2003
                                   -----------------------------------------
<S>                                   <C>                        <C>

     NET INCREASE (DECREASE)
      IN CASH AND CASH
      EQUIVALENTS                     $   289,613                $ (16,418)

CASH AND CASH EQUIVALENTS-Beginning         7,024                   27,817
-------------------------             -----------                ---------

CASH AND CASH EQUIVALENTS-Ending      $   296,637                $  11,399
-------------------------             ===========                ==========


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
-------------------------------------------------

Cash paid during the period for:

Interest                              $     3,234                $  13,631

Income taxes                          $        --                $      --

</TABLE>

Non-cash investing and financing activities:

  During the period ended, a stockholder converted its notes payable and
  accrued interest into 410,424 shares of the Company's common stock valued
  at $41,042.

  During the period ended, the Company issued warrants for consulting
  services.  The fair market value of the warrants granted using the Black-
  Scholes pricing model was $50,000.

  During the period ended, the Company issued 2,801,120 shares of Common
  Stock valued at $700,280 as a deposit for the BMZ asset acquisition.

See accompanying Notes to the Condensed Consolidated Financial Statements.









                                        7

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
----------------------------------------------------------------------------

NOTE 1 - Description of Business and Basis of Presentation
         -------------------------------------------------

  Financial Statements
  --------------------
  The condensed consolidated balance sheet of Energy & Engine Technology
  Corporation ("EENT" or the "Company") as of June 30, 2004, the related
  condensed consolidated statements of operations for the three and six
  months ended June 30, 2004 and 2003 and cash flows for the six months
  ended June 30, 2004 and 2003 included in Item 1 have been prepared by the
  Company, without audit, pursuant to the rules and regulations of the
  Securities and Exchange Commission ("SEC" or "Commission").  Certain
  information and footnote disclosures normally included in financial
  statements prepared in accordance with accounting principles generally
  accepted in the United States of American have been condensed or omitted
  pursuant to such rules and regulations.  In the opinion of management, the
  accompanying condensed consolidated financial statements include all
  adjustments (consisting of normal, recurring adjustments) necessary in
  order to make the financial statements not misleading.  The results of
  operations for the three and six months ended June 30, 2004 are not
  necessarily indicative of the results of operations for the full year or
  any other interim period.  These condensed consolidated financial
  statements should be read in conjunction with the audited consolidated
  financial statements and notes thereto included in the Company's Annual
  Report on Form 10-KSB for the year ended December 31, 2003 and filed with
  the Commission.

  Organization and Principal Business Activity
  --------------------------------------------
  EENT was incorporated under the name Bidder Communications, Inc. in Nevada
  on November 16, 1999. It changed its name from Bidder Communications, Inc.
  ("Bidder") to Energy & Engine Technology Corporation on December 5, 2001.

  The consolidated financial statements include the accounts of EENT and its
  wholly owned subsidiaries, Gas Gathering Enterprises, LLC ("Gas Gathering")
  (previously, Southern States Gas Gathering, LLC) and Wind Dancer Aviation
  Services, Inc. ("Wind Dancer") collectively referred to as the "Company."

  The Company, through its wholly owned subsidiaries, is the owner and
  operator of a natural gas gathering system located in Caddo Parish,
  Louisiana, and is a fixed base operator which services general aviation
  aircraft in Pagosa Springs, Colorado. EENT also is the developer and
  marketer of AXP 1000 auxiliary power generator for long haul trucks. During
  the fourth quarter 2003 the Company began manufacturing operations and has
  sales of the AXP 1000 power generators.

  Consolidation
  -------------
  The consolidated financial statements include the accounts of EENT and its
  wholly owned subsidiaries. All significant intercompany balances and
  transactions have been eliminated in consolidation.


                                        8

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------

NOTE 1 - Description of Business and Basis of Presentation, continued
         -------------------------------------------------

  Revenue Recognition
  -------------------

    Gas Gathering
    -------------
    Revenue is recognized at the time the product is sold and made available
    to its customers.

    Fixed Base Operator
    -------------------
    Revenue is recognized at the time the services are performed and provided,
    or made available to its customers.

    AXP 1000 Power Generators
    -------------------------
    Revenue is recognized at the time the generator is delivered to the
    customer.

  Cash and Cash Equivalents
  -------------------------
  For the purposes of the statement of cash flows, the Company considers
  all short-term investments with an original maturity of three months or
  less to be cash equivalents.

  Inventory
  ---------
  Inventory consists of aviation fuel, parts and materials and engines and
  is valued at the lower of cost or market, cost is being determined using
  the first in/first-out basis.

  Research and Development
  ------------------------
  Research and development costs are expensed as incurred. Research and
  development costs for the six months ended June 30, 2004 and 2003 were
  $7,619 and $55,973, respectively, and are included in selling, general and
  administrative expenses.

  Income Taxes
  ------------
  The Company accounts for income taxes using the liability method, which
  requires the determination of deferred tax assets and liabilities based on
  the differences between the financial and tax bases of assets and
  liabilities using enacted tax rates in effect for the year in which
  differences are expected to reverse. Deferred tax assets are adjusted by a
  valuation allowance, if, based on the weight of available evidence, it is
  more likely than not that some portion or all of the deferred tax assets
  will not be realized.



                                        9

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
----------------------------------------------------------------------------
NOTE 1 - Description of Business and Basis of Presentation, continued
         -------------------------------------------------

  Depreciation and Amortization
  -----------------------------
  Depreciation and amortization of furniture, fixtures and gas gathering
  equipment is computed on the straight-line method at rates adequate to
  allocate the cost of applicable assets over their expected useful lives.

  Net Loss per Share
  ------------------
  Basic EPS is computed by dividing income (loss) available to common
  stockholders by the weighted-average number of common shares outstanding
  for the period.  Diluted EPS is based on the weighted-average number of
  shares of common stock and common stock equivalents outstanding at year-
  end.   Common stock equivalents have been excluded from the weighted-
  average shares for the six months ended June 30, 2004 and 2003, as
  inclusion is anti-dilutive.  Potentially dilutive securities (warrants) of
  12,045,000 and 870,000 are outstanding at June 30, 2004 and 2003,
  respectively.

  Use of Estimates in the Financial Statements
  --------------------------------------------
  The preparation of financial statements in conformity with accounting
  principles generally accepted in the United States of America requires
  management to make estimates and assumptions that affect the reported
  amounts of assets and liabilities at the date of the financial statements
  and the reported amounts of revenues and expenses during the reporting
  period.  Actual results could differ from those estimates.

NOTE 2 - Note Payable Stockholder
         ------------------------

  As of June 30, 2004, the Company is in default of the terms on an
  outstanding note payable with one of its stockholders. The note was due on
  January 7, 2004 with principal balance due of $25,000 and accrued interest
  of $3,546.

NOTE 3 - Common Stock
         ------------
  During the period ended March 31, 2004, the Company issued an aggregate of
  3,300,000 shares of common stock valued at $1,524,000 to three officers of
  the Company for services performed.

  On January 23, 2004 through March 12, 2004, in connection with a private
  placement offering, the Company sold an aggregate of 15,455,000 shares of
  common stock to investors at $0.10 per share or $1,460,500 net of offering
  costs of $85,000.  The Company also issued an additional 104,000 shares of
  common stock and on May 6, 2004, issued 810,000 warrants (See Note 7) to
  consultants in connection with this offering.  In consideration of
  consulting services to be provided, the Company has granted the right of
  first refusal for future financing for a period of six months to one of
  these investors.

                                       10

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
----------------------------------------------------------------------------
NOTE 3 - Common Stock - continued
         ------------

  As additional consideration for consulting service, the Company has also
  issued warrants to this investor to purchase 500,000 shares of the Company's
  common stock with an exercise price of $0.20, which expire in one year.  The
  fair market value of the warrants granted using the Black-Scholes pricing
  model was $50,000.

  On January 30, 2004, the Company issued 130,000 shares of common stock
  valued at $24,700 to a former employee in connection with a termination
  agreement.

  On March 1, 2004, in connection with a private placement offering, the
  Company sold 1,350,000 shares of common stock to an investor at $0.20 per
  share or $270,000.  In connection with this private placement offering the
  Company issued warrants to purchase 405,000 shares of the Company's common
  stock with an exercise price of $0.40 expiring on February 26, 2006.

  During the first quarter, the Company issued an aggregate of 204,000 shares
  of common stock valued at $47,190 to consultants for services provided.

  During the first quarter, the Company issued 410,424 shares of common stock
  to a shareholder in satisfaction of a $40,000 note payable plus accrued
  interest in the amount of $1,042.

  On March 31, 2004, the Company issued 4,428,382 shares of common stock to
  an investor pursuant to an anti-dilution agreement.

  On May 19, 2004 the Company issued an aggregate of 152,500 shares of the
  Company's common stock to three employees of the Company valued at $43,125
  for services provided.

  On June 4, 2004, the Company issued 2,801,120 shares of common stock valued
  at $700,280 as part of the acquisition price for BMZ and its related
  intellectual property.  The stock was issued as an advance to the sole
  stockholder of BMZ and included as part of the deposit on asset acquisition
  as of June 30, 2004 (see note 7).

  On June 21, 2004, the Company issued 94,595 shares of common stock valued
  at $35,000 to a consultant for services provided.

  On June 30, 2004, the Company issued 2,167,459 shares to an investor
  pursuant to an anti-dilution agreement.










                                       11

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------
NOTE 4 - Warrants
         --------
  Transactions involving warrants are summarized as follows:

<TABLE>
<CAPTION>

  <S>                                   <C>               <C>
                                         Number             Weighted
                                           Of                Average
                                        Warrants          Exercise Price
                                        --------------------------------

  Balance - December 31, 2003            1,355,000             $0.13

  Warrants issued during the period     10,715,000             $0.24

  Warrants expired during the period       (25,000)            $0.10

  Balance - June 30, 2004               12,045,000             $0.23


</TABLE>


  On May 6, 2004, in connection with the January 23, 2004 through March 12,
  2004 private placement offering (See Note 3), the Company issued 810,000
  warrants to purchase the Company's common stock to five consultants.  The
  exercise price for each warrant is $0.10 per share.

  On May 12, 2004, the Company issued 9,000,000 warrants to purchase the
  Company's common stock to its officers.  The exercise price of each warrant
  is $0.25 per share.

The fair value of the warrants, using the Black-Scholes option valuation
model, is $2,250,000 (see note 5).

There were 12,045,000 warrants exercisable at June 30, 2004.

NOTE 5- Stock-Based Compensation
        ------------------------

  Stock-Based Compensation - The Company adopted Statement of Financial
  Accounting Standard ("SFAS") No. 148, "Accounting for Stock-Based Compen-
  sation - Transition and Disclosure."  This statement amended SFAS No. 123,
  "Accounting for Stock-Based Compensation."  As permitted under SFAS No. 123,
  the Company continues to apply the Accounting Principles Board Opinion No.
  25, "Accounting for Stock Issued to Employees."  As required under SFAS No.
  148, the following table presents pro forma net loss attributable to common
  stockholders for basic and diluted net loss per share as if the fair value-
  based method had been applied to all awards.



                                       12

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------
<TABLE>
<CAPTION>
  <S>                      <C>           <C>            <C>           <C>

                               Three Months Ended            Six Months Ended
                           ---------------------------- ----------------------------
                           June 30, 2004 June 30, 2003  June 30, 2004 June 30, 2003
                           ---------------------------- ----------------------------


  Net loss attributable
    to common shareholders
    - as reported          $   (470,316) $(351,810)     $(2,505,276)  $(772,752)

  Stock-based employee
    compensation cost
    determined under fair
    value method, net of
    tax effects              (2,250,000)        --       (2,250,000)         --
                           -----------------------      -----------------------
  Net loss attributable
  to common stockholders
  - pro forma              $ (2,720,316) $(351,810)     $(4,755,276)  $(772,752)
                           =======================      =======================

  Loss per share

  Basic and diluted loss
    per share: Net loss
    attributable to
    common stockholders
    - as reported          $      (0.01)  $   (0.01)     $     (0.03)  $   (0.03)

                           -----------------------       -----------------------
  Net loss attributable
    to common
    stockholders - pro
    forma                 $      (0.03)  $   (0.01)     $     (0.05)  $   (0.03)
                           ========================    =========================
</TABLE>

                                       13

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------

  The Black-Scholes option valuation model was used to estimate the fair value
  of the warrants granted during the six months ended June 30, 2004.  There
  were no stock options or warrants granted to employees during the six months
  ending June 30, 2003.  The model includes subjective input assumptions that
  can materially affect the fair value estimates.  The model was developed for
  use in estimating the fair value of traded options that have no vesting
  restrictions and that are fully transferable.  For example, the expected
  volatility is estimated based on the most recent historical period of time
  equal to the weighted average life of the options granted.  Options issued
  under the Company's option plans have characteristics that differ from
  traded options.  In the Company's opinion, this valuation model does not
  necessarily provide a reliable single measure of the fair value of its
  employee stock options.  Principal assumptions used in applying the Black-
  Scholes model along with the results from the model were as follows:

<TABLE>
<CAPTION>

  <S>                                   <C>


  Assumptions:
  Risk-free interest rate               3.96%

  Dividend                              0.00%

  Expected life in years                 5.0

  Expected volatility                    124%

</TABLE>






















                                       14

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES
            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------
NOTE 6 - Segment Reporting
         -----------------
  Summarized financial information concerning the Company's reportable
  segments are shown in the following tables.
<TABLE>
<CAPTION>
<S>                       <C>          <C>          <C>          <C>          <C>
                             Gas        Wind          AXP        General
                          Gathering    Dancer         1000       Corporation  Total
------------------------------------------------------------------------------------------
For the Six Months Ended June 30, 2004:

Revenue                  $       244   $   180,579  $    40,008  $        --  $   220,831
                         ===========   ===========  ===========  ===========  ===========
Operating Loss           $   (16,211)  $   (86,522) $   (78,955) $(2,272,993) $(2,454,682)
                         ===========   ===========  ===========  ===========  ===========
Net Loss                 $   (16,211)  $   (85,922) $   (78,955) $(2,324,187) $(2,505,276)
                         ===========   ===========  ===========  ===========  ===========
Capital Expenditures     $        --   $     2,537  $        --  $    34,174  $    36,711
                         ===========   ===========  ===========  ===========  ===========
  Total identifiable
  assets at June 30,
  2004                   $   182,474   $   297,603  $ 1,418,925  $   366,161  $ 2,265,163
                         ===========   ===========  ===========  ===========  ===========

For the Six Months Ended June 30, 2003

Revenue                  $     1,245   $   107,811  $        --  $        --  $   109,056
                         ===========   ===========  ===========  ===========  ===========
Operating Loss           $   (16,586)  $   (89,947) $        --  $  (641,890) $  (748,423)
                         ===========   ===========  ===========  ===========  ===========
Net Loss                 $   (16,586)  $   (89,975) $        --  $  (666,191) $  (772,752)
                         ===========   ===========  ===========  ===========  ===========
Capital Expenditures     $        --   $    18,831  $        --  $     1,670  $    20,501
                         ===========   ===========  ===========  ===========  ===========
</TABLE>                               15

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES
            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------
NOTE 6 - Segment Reporting, continued
         -----------------
<TABLE>
<CAPTION>

<S>                       <C>          <C>          <C>          <C>          <C>
For the Three Months Ended June 30, 2004

Revenue                  $       244   $    96,187  $    15,495  $        --  $   111,926
                         ===========   ===========  ===========  ===========  ===========
Operating Loss           $    (2,494)  $   (34,239) $   (24,398) $  (385,423) $  (446,555)
                         ===========   ===========  ===========  ===========  ===========
Net Loss                 $    (2,494)  $   (35,092) $   (24,399) $  (408,330) $  (470,316)
                         ===========   ===========  ===========  ===========  ===========
Capital Expenditures     $        --   $       843  $        --  $     8,053  $     8,897
                         ===========   ===========  ===========  ===========  ===========

For the Three Months Ended June 30, 2003

Revenue                  $       335   $    50,631  $        --  $        --  $    50,966
                         ===========   ===========  ===========  ===========  ===========
Operating Loss           $    (6,053)  $   (55,816) $        --  $  (276,055) $  (337,924)
                         ===========   ===========  ===========  ===========  ===========
Net Loss                 $    (6,053)  $   (55,844) $        --  $  (289,913) $  (351,810)
                         ===========   ===========  ===========  ===========  ===========
Capital Expenditures     $        --   $    16,109  $        --  $     1,050  $    17,159
                         ===========   ===========  ===========  ===========  ===========
</TABLE>

NOTE 7 - Other items
         -----------

  Authorized Shares
  -----------------
  On February 18, 2004, the Company filed a Certificate of Amendment to its
  Article of Incorporation to increase their authorized shares of common stock
  to 180,000,000.
                                       16

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------
NOTE 7 - Other items, continued
         -----------
  Asset Acquisition
  -----------------
  On March 4, 2004 the Company entered into a term sheet, subject to a
  definitive purchase agreement with BMZ Generators & Welders, Inc ("BMZ"),
  which is the Company's manufacturer of the AXP 1000 product, to purchase
  certain assets and intellectual property of BMZ.

  On May 19, 2004, the Company entered into a definitive purchase agreement
  with BMZ and Freddy Pereira, the owner of BMZ, pursuant to which the Company
  was to purchase all of BMZ's assets and related intellectual property, owned
  by Pereira for $2,000,000, $500,000 in cash at closing and $500,000 in
  Company Common Stock upon presentation of written documentation for the
  intellectual property with the last $1,000,000 being paid out over five
  years based on certain earn out criteria from the ongoing business of the
  subsidiary which purchased the assets.  EENT hired Pereira to run the
  business arising from the purchased assets as of July 1, 2004.  The trans-
  action closed effective as of July 1, 2004, with BMZ Generators Technology,
  Inc., a wholly owned subsidiary of the Company, as the purchaser.  Although
  the parties negotiated the stock value at $500,000, it is being recorded for
  accounting purposes only at $700,280 based on the closing price of 2,801,120
  shares of the Company's Common Stock (see Note 3), as of May 19, 2004, the
  date of the definitive agreement.  The Company also issued these shares on
  June 4, 2004 in advance of the presentation of written documentation for the
  intellectual property as outlined in the definitive purchase agreement. This
  $700,280 is included in Deposit on Asset Acquisition as of June 30, 2004.
  The Company also advanced an additional $113,368 in connection with this
  asset acquisition.

  As of June 30, 2004 the Company has also advanced to BMZ approximately
  $342,000 which is included in prepaid expense and other current assets.
  This amount will be applied to advances for purchases of inventory.

  Legal Proceedings
  -----------------
  On October 27, 2003, the Company was served with a complaint that alleges
  that EENT is liable on a $150,000 judgment issued against Millennium Fuels
  USA, LLC ("MFUSA"), an unrelated entity, of which Will McAndrew and Roger
  Wurtele, the Company's CEO and CFO, respectively, were formerly the
  Managers.

  The Company's believes that the claim is without merit and intends to
  aggressively defend this claim brought against the Company.  At this time
  it is too early to evaluate with any reasonable certainty the likelihood of
  a favorable or unfavorable outcome.

NOTE 8 - Subsequent Events
         -----------------

  On July 26, 2004, in connection with a private placement offering, the
  Company sold an aggregate 115,000 shares of common stock to two investors
  at $0.22 per share or $25,300.

                                       17

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------
NOTE 8 - Subsequent Events, continued
         -----------------

  On July 29, 2004, several funds, affiliated with Mercator Advisory Group,
  LLC of Los Angeles, California, (collectively, with Mercator "MAG") have
  invested $1.7 million in the aggregate in the Company.

  The funds were invested pursuant to 7.0% Convertible Debentures, dated
  as of July 29, 2004 (the "Debentures").

  The terms of the Debentures are as follows:

  The coupon payment is due on the first trading day of each month while
  the debentures are outstanding and the Debentures are due on the one year
  anniversary of the issuance date.

  The Debentures are convertible into EENT Common Stock at any time at the
  holder's discretion in part or in whole by dividing the principal amount
  converted by a price ("Conversion Price") equal to 85% of the Market Price
  (average inter day trading price during the 10 immediately preceding trading
  days).  In no event shall the Conversion Price be higher than $.39 or lower
  than $.10.  At all times beneficial ownership of EENT Common Stock shall not
  exceed 9.99% on an as converted basis.  Conversion Price is adjusted
  equitably for stock splits and the like.

  MAG was issued an aggregate of 4,358,974 three year warrants at an exercise
  price of $.39 per share.  The warrants are callable by the Company at $.39
  per share if for any 10 day trading period the common stock closes at at
  least $1.17 per share for each of the trading days.

  Within 30 days of July 29, 2004, EENT is required to file a registration
  statement on Form SB-2 for the shares into which the Convertible Debentures
  are convertible and underlying the Warrants.  The Company shall use its best
  efforts to have the registration statement declared effective within 120
  days after initial filing.

  Events of Default under the Convertible Debentures include: bankruptcy;
  failure to timely file the Registration Statement; failure to maintain
  trading of the Common Stock on the over the counter bulletin board; and
  failure to make any payment within 30 days of the due date therefor.
  Remedies include the Conversion Price to decrease to 75% of the Market
  Price, and payment of a 1% per month penalty for late filing of the
  registration statement, or if it is not effective within 120 days after
  filing.

  MAG also represents that it would not engage in the short selling of the
  Company's stock.

  On August 10, 2004, in connection with services rendered, the Company
  issued 50,000 shares of common stock to an employee.

  On August 10, 2004, in connection with services rendered, the Company
  issued 94,595 shares to two individuals for consulting services.

                                       18

                                      ENERGY & ENGINE TECHNOLOGY CORPORATION
                                                            AND SUBSIDIARIES

            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
---------------------------------------------------------------------------
NOTE 8 - Subsequent Events, continued
         -----------------

  On August 10, 2004, in regards to an anti-dilution agreement, the Company
  issued 64,899 shares to a shareholder.


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

OVERVIEW
--------
Registrant operates businesses which provide products to various aspects of
the transportation industry (long haul trucking and general aviation) which
supply innovative products to promote efficiency of operation of motor
vehicles, reduce fuel consumption and assist in reducing pollutive emissions
from operation of motor vehicles.

Registrant also owns a natural gas gathering system in Louisiana, which was
being operated by a related third party, American West Resources, Inc., as of
June 30, 2004, which also had an option to purchase such System; however,
minimal amounts of revenue were generated from the System activity during
2003, or the six months ended June 30, 2004 and the manager did not exercise
its option.  Although the manager has had gas flow through the System and the
potential to increase such flow, the System has been subject in recent
months to several hiatuses in operation.  Additionally, the manager had
not provided Registrant with any definitive indication as to availability
of cash flow to continue operation or ability to raise investment funds to
purchase the System, despite requests from Registrant.  Therefore, Registrant
has concluded that it is unlikely that the manager will be able to close and
has terminated the letter of intent with the manager to purchase the System
and has shifted focus away from the System.  However, Registrant is
currently seeking alternative buyers for the System.

Long Haul Trucking Industry and the AXP 1000 (according to statistics gleaned
from Truckinfo.net in late March 2004):

*   The overall U.S. trucking industry employs over 9 million individuals,
    with an estimated 15.5 million trucks overall, of these 1.9 million are
    tractor trailers.

*   There are an estimated 3.3 million truck drivers, with 10% being
    independent truckers (mostly owner operators).

*   There are also over 360,000 trucking companies with 96% operating 28 or
    fewer trucks.

*   Total revenue estimates are $255 billion per year.

*   However, profit margins are very small ($.048 per dollar of revenue),
    and the average trucker earns under $40,000 per year, with 12.8% of all
    fuel purchased belonging to truckers.

*   The U.S. Department of Labor estimates that the demand for employment
    of truck drivers may triple by 2020 from current levels.
                                       19

Given these small profit margins and the January 2004 federal mandates
requiring 10 hours of rest for every 11 hours driven (combined with the
state and local anti idling laws), there is a need for solutions which can
achieve the combined goals of: utilizing all means possible to take
measures to increase profit margin and compliance with the increased and
more enforced federal and state legislation affecting long haul trucks.
Solutions to be used must combine these two goals.  Hence, the increasing
popularity of auxiliary power units ("APUs") other alternatives, such as
truck stop electrification, exist, but require large capital expenditures
and are thus less likely to become prevalent.

EENT's experience is that although APUs have been around for several years,
the recent increase in diesel prices, combined with stricter enforcement,
has placed a spotlight on this cottage industry (with industry estimates
that it could become a $2.5 billion dollar per year industry), which
heretofore had been filled with small niche players with minimal followings.
Such newfound industry is evident from the formation of a trade association
for APU manufacturers (Idle Eliminators Manufacturing Association) and
various conferences (such as the May 2004 Anti Idling Conference in Albany,
New York). Additionally, EENT has participated in several trucking industry
trade shows over the past 13 months, with increased interest in the AXP 1000
at each show.

Given the size of the market, EENT believes that there is ample room for
itself and its competitors.  With estimates of 500,000 or more long haul
trucks on the road today, even if EENT were to only capture a 1% market
share, with an average sales price of $5000 per unit, this represents gross
revenues of $25,000,000.  If EENT can overcome its two biggest challenges,
sound and production, EENT believes it can sell 1000 - 2000 units in 2004,
which would yield $5,000,000 - $10,000,000 in sales.

The AXP 1000 has also been successful in distinguishing itself from its
competitors in several areas, including:

*   Lower cost

*   Lighter weight

*   Only unit to sit between the rails

*   Low maintenance burden

The biggest overall challenge is coordinating production/supply chain and
sales.  EENT is in the process of purchasing BMZ Generators, its contract
assembly facility, which in its current space can assemble 30 - 50 generators
per month.  BMZ's owner, Freddy Pereira, has purchased a large facility in
Pompano Beach Florida, which has been built out and the Certificate of
Occupancy issued as of the first week of August, 2004.  EENT hopes to spend
the next few weeks moving into the space with production to commence in late
August and early September 2004.  EENT will be leasing space from Pereira
and expects initial assembly volume to be close to 100 units per month at some
point during the fourth quarter of 2004.  By purchasing BMZ, EENT will also
have direct access to its generator manufacturer, thus controlling supply.

The BMZ purchase will give EENT the opportunity to expand into other stand
alone and portable generator markets in the future, such as the marine,
aviation and military industries, thus giving it flexibility in expansion of
revenue base should the APU market become saturated.  Also, the facility will

                                       20

become, under the aegis of Freddy Pereira, ISO 9001 certified, allowing it to
be an industry accepted testing facility for its products.

On the supply chain issue, in March 2004, Registrant's CEO and CFO traveled
with BMZ owner, Freddy Pereira, to meet with the manufacturer of the custom
made generator used in the AXP 1000.  The meetings proved successful in
allowing Registrant to conduct sufficient due diligence to be comfortable
that the manufacturer will be able to meet Registrant's increasing product
need.

With regard to the challenge of reducing the sound emission level with the AXP
1000, Registrant is applying to a program sponsored by NASA, called SATOP
(Space Alliance Technology Outreach Program) which provides up to 40 hours of
free technology assistance to small businesses looking to apply space
technology (such as noise reduction) to the private sector.  EENT is in the
process of applying for the program and feels that it meets the outlined
qualifications.  Additionally, Registrant is exploring opportunities in the
private sector to take advantage of quieter technologies; however, sound
reduction is proving to be a more difficult task than originally anticipated.
It is significant to note that, although noise reduction is an ongoing
process, the sound level from the AXP 1000 is still significantly lower than
from a truck's main engine or the generator used for cooling by reefers
(refrigerated truck trailers).

General Aviation/Wind Dancer:

The discussion in the business section provides ample detail on the industry.
While EENT had placed great confidence in the ability to produce marketable
product from its STC purchases experience has shown that this process will
take significantly more time and funding than anticipated.  Therefore, EENT
has determined to instead concentrate on Wind Dancer's "bread and butter"
businesses - fuel sales and general aviation aircraft maintenance and
installation of third party turbocharger systems.  While Wind Dancer will
not generate large amounts of revenue, it is generating at present, an
average of $30,000 per month, and although there will be a dip over the
summer as the Stevens Field runway length is reduced to 4000 feet, upon
completion of runway renovations, Wind Dancer will benefit from the ability
of jet aircraft to take off with full loads of fuel (increase in weight to
70,000 lbs. from 16,000 lbs.), which should greatly increase Wind Dancer's
sale of jet fuel, from increased number of jets using the airport, and jets
purchasing more fuel (instead of taking off with partially filled tanks due
to weight limitation with the need to stop at another general aviation
airport with higher weight capacity to top off tanks).  While EENT is
exploring the efficacy of pursuing the STC program, at present, it has
determined that the priority is to use available cash to fund AXP 1000 needs,
and it is considering sale of some of its STCs to a third party.

Additional 2004 Goals:

Management has, in addition to product specific goals, undertaken to use its
reasonable best efforts to accomplish the following in 2004:

*   Listing on the Australian Stock Exchange to ease buying and selling of
    EENT stock by Pacific Rim Shareholders

*   Preparation for listing on a U.S. regulated exchange (most probably the
    American Stock Exchange) and effectuating that listing, depending on
    ability to meet listing criteria, in late 2004 or early 2005

                                       21

*   Implementation of further internal controls and policies and procedures
    to continue to self manage the growth of Registrant's business and
    personnel as the business expands

*   Possible sale of non revenue generating assets, such as the Gas Gathering
    System, and certain STCs owned by Wind Dancer Aviation, to create
    additional cash available to utilize in the growth of the AXP 1000 and
    Wind Dancer business segments and to explore additional genset
    applications, as discussed under the AXP 1000 heading above

*   Shift from reliance of use of outside consultants for support services
    (such as investor relations) to self reliance for such services through
    the use of internal resources and personnel

*   Identification of new markets for products and long range business
    planning for all business units

RESULTS OF OPERATIONS
---------------------

Registrant had realized revenues of $50,966 for the three months ended
June 30, 2003 and $109,056 for the six months ended June 30, 2003  During the
six months ended June 30, 2004, Registrant realized revenues of $220,831,
$180,579 from its operations of the Wind Dancer Aviation Services, Inc.
subsidiary, $40,008 from sales of the AXP and $244 from Gas Gathering systems.
During the three months ended June 30, 2004, Registrant had realized revenues
of $111,926, $96,187 from its operations of the Wind Dancer Aviation Services,
Inc. subsidiary, $15,495 from sales of its AXP 1000 product and $244 from Gas
Gathering Systems.  The delays in production of the AXP 1000 product continue
as EENT, as of the date of filing this Form 10-QSB, is poised to move into the
new facility being leased from Fernando A. Pereira in Pompano Beach, Florida.
Production is expected to be sluggish until the new facility is complete and
EENT is able to move assembly operations there.  The revenues from Wind Dancer
Aviation continue to be consistently derived from fuel sales (which has been
lower than anticipated this Summer due to the runway construction which has
caused on 3900 feet of runway to be available causing many planes to land at
other area airports) and aircraft maintenance work.  The STC-derived turbo-
charger business is a long term capital intensive proposition, which EENT has
deemed to not be a priority for capital investment at present.

With regard to EENT's gas gathering system, EENT has terminated the relation-
ship with American West Resources for lack of success and lack of
demonstration of ability to fund purchase of the System.  EENT is looking
for other opportunities to sell the System but in the interim has "shut in"
the System to avoid further losses.  Please refer to our 2003 10-KSB  for
further detail.

Registrant had a net loss of $772,752 for the six months ended June 30, 2003
and of $2,505,276 for the six months ended June 30, 2004, resulting in a net
loss per share of $.03 and $.03 respectively.  Registrant had a net loss of
$351,810 for the three months ended June 30, 3003 and of $470,316 for the 3
months ended June 30, 2004, resulting in a net loss per share of $.01 and $.01
respectively.  The marked increase in net loss is based primarily on financing
costs but also on increased overhead costs as the Company prepares for
production and increases staff and equipment in order to become production
ready.



                                       22

Selling, general and administrative expenses for the six months ended June 30,
2003 and June 30, 2004 were $682,993 and $750,327 respectively and for the
three months ended June 30, 2003 and June 30, 2004 were $343,214 and $389,559,
respectively.  The increase in selling, general and administrative expenses is
based primarily upon increases in overhead costs due to increases in staff and
equipment as the Company prepares for production of its products.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

As of December 31, 2003 and June 30, 2004, Registrant's primary sources of
liquidity included cash and cash equivalents in the amount of $7,024 and
$296,637, respectively, which was the balance of proceeds raised in
several private Section 4(2) stock sales and note payable agreements.

Registrant, however closed on $1.7 million in financing on July 29, 2004.
Registrant believes that its existing cash balance and future operating cash
flows should be sufficient for near term operating needs (given the completed
capital raise in February 2004 and on July 29, 2004).

As mentioned in the overview, the length of time to completion of the Stevens
Field runway expansion is significant as during the construction period,
there will be limited access to the Field, which will cause decreased amounts
of fuel to be sold during the Summer of 2004, typically the FBO's busy season
for fuel sales.  However, Wind Dancer should be able to continue to
consistently attract maintenance and third party turbocharger installation
work to offset the potential loss of $20,000 - $30,000 in fuel sale revenue
over the second and third quarters.  Once the construction is complete and
jets can land and take on more fuel, there should be offsetting sales of fuel
in the fourth quarter to substantially counteract the intermediate losses.

With regard to known trends and events reasonably expected to have a
material impact on net sales and revenues, Registrant strongly believes that
the heightened interest in idling alternatives should provide a stronger
demand for the AXP 1000 device.  Uncertainties include whether there can be
sufficient noise reduction in the AXP 1000 to overcome objections from some
long haul truckers (the AXP 1000 is air cooled rather than water cooled, so
it has a somewhat elevated noise level when compared with liquid cooled
devices).   EENT is currently working on alternatives to lower the noise
level and is making steady progress.  There is also concern over the
reliability of the HVAC unit currently used, but management believes
alternatives are available.  Also, Registrant does not believe it will be
faced with the same delays it experienced in 2003, which were largely
caused by cash flow issues.

The other major uncertainty is the extent to whether new technology will
appear that will make the small generator/engine genset used by EENT
obsolete.  Given the potential development of other power generator
technologies, there may be a limited window of 5 - 10 years for EENT's
technology as currently configured.  Therefore, EENT, in addition to
gearing up for current production, is looking into commencing a research
and development project for its next generation products, which is
envisioned to be a part of the AXP 1000 business unit, with project
specific funding, to be determined in the future as the details of such
research and development products come to fruition.  Discussions for a
joint venture with a company with a potential alternative fuel
generation source are under way.  Registrant is also in the process of
securing its next generation engine driven genset, to replace the

                                       23

currently used engine.  This is an intermediate step to be taken before
putting an alternative fuel generation source into commercial production.

Another guard against obsolescence is looking for new markets for BMZ
generators.  Therefore, Registrant will commence exploration of marketing
and sales for the generator products in other likely industries, most
notably marine, aviation and military.

Of course, EENT's business is subject to customary and usual business risks,
not necessarily subject to its control, including, but not limited, to:

*   Ordinary operating risks (product, labor and capital cost increases)

*   General economic conditions

*   Changes in laws and regulations

*   Competition

*   Stock and product market volatility

*   "Acts of God"

Item 3. Controls and Procedures.

Disclosure Controls and Procedures

The Company maintains controls and procedures designed to ensure that it is
able to collect the information that is required to be disclosed in the
reports it files with the SEC, and to process, summarize and disclose this
information within the time period specified in the rules of the SEC. The
Company's Chief Executive and Chief Financial Officers are responsible for
establishing, maintaining and enhancing these procedures. They are also
responsible, as required by the rules established by the SEC, for the
evaluation of the effectiveness of these procedures.

Based on their evaluation of the Company's disclosure controls and
procedures which took place as of the filing of this report, the Chief
Executive Officer and the Chief Financial Officer believe that these
procedures are effective to ensure that the Company is able to collect,
process and disclose the information it is required to disclose in the
reports it files with the SEC within the required time period.

Internal Controls

The Company maintains a system of internal controls designed to provide
reasonable assurance that transactions are executed in accordance with
management's general or specific authorization; transactions are recorded
as necessary to (1) permit preparation of financial statements in
conformity with accepted accounting principles generally accepted in the
United States of America, and (2) maintain accountability for assets.
Access to assets is permitted only in accordance with management's general
or specific authorization.

Since the date of the most recent evaluation of the Company's internal
controls by the Chief Executive and Chief Financial Officers, there have
been no significant changes in such controls or in other factors that could


                                       24

have significantly affected those controls, including any corrective actions
with regard to significant deficiencies and material weaknesses.

                       PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

600 Racing, Inc. v. EENT et. al.
--------------------------------
On October 28, 2003, the Company was served with a complaint by 600 Racing,
Inc.  The complaint alleges that EENT is liable on a $150,000 judgment
issued against Millennium Fuels USA, LLC ("MFUSA"), an unrelated entity, of
which Will McAndrew and Roger Wurtele, the Company's CEO and CFO,
respectively, were the Managers.  The complaint alleges that the Company
engaged in a joint enterprise with MFUSA and integrated resources with MFUSA
and is thus liable on an "alter ego" theory.  Alternatively, the complaint
alleges Company liability based upon the allegation that the Company
deprived MFUSA of corporate opportunity and thus tortiously interfered with
MFUSA's contract with Plaintiff.

Company's counsel states that the claims are without merit in that MFUSA and
the Company were two distinct businesses, with separate business plans and
no commingling of funds.  Each had separate operations with the only
coincidence being the fact that McAndrew and Wurtele were officers of both
entities and the entities share a business address.  Lastly, McAndrew and
Wurtele did not become substantially involved with the Company until December
2001, which was well after the end of dealings between Plaintiff and MFUSA.
Defense counsel is filing an answer and expects to be able to effect the
Company's dismissal from the suit without any liability due to the lack of
meritorious claims.

Item 2. Changes in Securities.

(a)  During the period ended March 31, 2004, the Company issued an aggregate
     of 3,300,000 shares of common stock valued at $1,524,000 to three
     officers of the Company for services performed.

(b)  On January 23, 2004 through March 12, 2004, in connection with a private
     placement offering, the Company sold an aggregate of 15,455,000 shares
     of common stock to investors at $0.10 per share or $1,460,500 net of
     offering costs of $85,000.  The Company also issued an additional
     104,000 shares of common stock and on May 6, 2004, issued 810,000
     warrants to consultants in connection with this offering.  In
     consideration of consulting services to be provided, the Company has
     granted the right of first refusal for future financing for a period of
     six months to one of these investors.

     As additional consideration for consulting service, the Company has also
     issued warrants to this investor to purchase 500,000 shares of the
     Company's common stock with an exercise price of $0.20, which expire in
     one year.  The fair market value of the warrants granted using the
     Black-Scholes pricing model was $50,000.

(c)  On January 30, 2004, the Company issued 130,000 shares of common stock
     valued at $24,700 to a former employee in connection with a termination
     agreement.



                                       25

(d)  On March 1, 2004, in connection with a private placement offering, the
     Company sold 1,350,000 shares of common stock to an investor at $0.20 per
     share or $270,000.  In connection with this private placement offering
     the Company issued warrants to purchase 405,000 shares of the Company's
     common stock with an exercise price of $0.40 expiring on February 26,
     2006.

(e)  During the first quarter, the Company issued an aggregate of 204,000
     shares of common stock valued at $47,190 to consultants for services
     provided.

(f)  During the first quarter, the Company issued 410,424 shares of common
     stock to a shareholder in satisfaction of a $40,000 note payable plus
     accrued interest in the amount of $1,042.

(g)  On March 31, 2004, the Company issued 4,428,382 shares of common stock
     to an investor in regards to an anti-dilution agreement.

(h)  On May 19, 2004, the Company issued an aggregate of 152,500 shares of
     the Company's common stock to three employees of the Company valued at
     $43,125 for services provided.

(i)  On June 4, 2004, the Company issued 2,801,120 shares of common stock
     valued at $700,280 as part of the acquisition price for BMZ and its
     related intellectual property.  The stock was issued as an advance to
     Fernando A. Pereira and included as part of the deposit on asset
     acquisition as of June 30, 2004 (see Note 7)

(j)  On June 21, 2004, the Company issued 94,595 shares of common stock valued
     at $35,000 to a consultant for services provided.

(k)  On June 30, 2004, the Company issued 2,167,459 shares to an investor
     pursuant to an anti-dilution agreement.

Item 3.  Defaults Upon Senior Securities.

Not Applicable.

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

Not Applicable.

Item 5. Other Information.

Not Applicable.

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

(a)  Exhibit
     Number   Description
     31.1     Certification by Chief Executive Officer pursuant to
              Section 302 of the Sarbanes-Oxley  Act  of  2002.
     31.2     Certification by Chief Financial Officer pursuant to
              Section 302 of the Sarbanes-Oxley  Act  of  2002.
     32.1     Certification by Chief Executive Officer pursuant to
              Section 906 of the Sarbanes-Oxley  Act  of  2002
     32.2     Certification by Chief Financial Officer pursuant to
              Section 906 of the Sarbanes-Oxley  Act  of  2002.

                                       26

(b)  Reports
     Item #   Description
       2      Acquisition or Disposition of Assets filed 7-16-04
       7      Financial Statements and Exhibits filed 7-16-04
     5 & 9    Other Events and Regulation Form D Disclosure filed 8-10-04
       7      Exhibits filed 8-10-04

                                     SIGNATURES

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

Date:  August 16, 2004              /s/ Willard G. McAndrew, III
                               ----------------------------------
                             Energy & Engine Technology Corporation


Date:  August 16, 2004              /s/ Willard G. McAndrew, III
                               ----------------------------------
                                   Willard G. McAndrew, III

Date:  August 16, 2004                 /s/ Roger N. Wurtele
                               ----------------------------------
                                       Roger N. Wurtele

*Print the name and title of each signing officer under his signature.
































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