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

                                   FORM 10-QSB


|X|   QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT
      OF 1934

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2006

|_|   TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE EXCHANGE ACT

                For the transition period from _______ to _______

                            Commission File #0-30503

                          PANGEA PETROLEUM CORPORATION
        (Exact name of small business issuer as specified in its charter)

            COLORADO                             76-0635938
   (State or other jurisdiction of     (IRS Employer Identification No.)
    incorporation or organization)

                9801 WESTHEIMER, SUITE 302, HOUSTON, TEXAS 77042
                    (Address of principal executive offices)

                                 (713) 706-6350
                           (Issuer's telephone number)


Check  whether the issuer (1) filed all reports  required 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 |_|


Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
                                                            Yes |_| No |X|

State the number of shares outstanding of each of the issuer's classes of common
stock as of the last practicable date:

270,073,290 SHARES OF $0.001 PAR VALUE COMMON STOCK OUTSTANDING AS OF MAY 1,
2006


Transitional Small Business Disclosure Format (check one):  Yes |_|  No |X|

                                                                               1
<PAGE>

                          PANGEA PETROLEUM CORPORATION
                                   FORM 10-QSB


                                TABLE OF CONTENTS

PART  I  -  FINANCIAL  INFORMATION

Item  1  -  Financial  Statements

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

Item  3  -  Controls and Procedures


PART II  -  OTHER INFORMATION

Item  2  -  Unregistered Sales of Equity  Securities and Use of Proceeds

Item  6  -  Exhibits

SIGNATURES

                                                                               2
<PAGE>

                            FORWARD LOOKING STATEMENT


The  following  discussion  should  be read in  conjunction  with our  unaudited
consolidated  interim financial statements and related notes thereto included in
this quarterly report and in our audited  consolidated  financial statements and
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations ("MD&A") contained in our Form 10-KSB for the year ended December 31,
2005.

We are including the following  cautionary statement in this Form 10-QSB to make
applicable  and take  advantage  of the safe  harbor  provision  of the  Private
Securities Litigation Reform Act of 1995 for any forward-looking statements made
by, or on behalf of, the Company.  Forward-looking statements include statements
concerning plans, objectives, goals, strategies,  expectations, future events or
performance and underlying  assumptions  and other  statements , which are other
than statements of historical  facts. The statements  contained herein and other
information  contained  in this report may be based,  in part,  on  management's
estimates,  projections,  plans and judgments.  These forward-looking statements
are subject to certain risks and  uncertainties  that could cause actual results
to differ  materially  from  historical  results or those  anticipated.  In this
report, the words "anticipates",  "believes",  "expects",  "intends",  "future",
"plans", "targets" and similar expressions identify forward-looking  statements.
Readers  are  cautioned  not to  place  undue  reliance  on the  forward-looking
statements contained herein. We undertake no obligation to publicly revise these
forward-looking  statements to reflect  events or  circumstances  that may arise
after the date hereof.  Our expectations,  beliefs and projections are expressed
in good faith and are believed to have a  reasonable  basis,  including  without
limitations,  management's  examination  of historical  operating  trends,  data
contained in our records and other data available from third parties,  but there
can be no assurance that management's expectations,  beliefs or projections will
result or be achieved or accomplished.  In addition to other factors and matters
discussed elsewhere herein, the following are important factors that could cause
actual results to differ materially from those discussed in the  forward-looking
statements: our dependence on limited cash resources,  dependence on certain key
personnel within the Company,  and the ability to raise additional capital;  our
ability to secure  leases for our oil and gas  projects;  our  ability to obtain
acceptable  forms and amounts of financing;  the demand for, and price level of,
our  products  and  services;  competitive  factors;  the  ability  to  mitigate
concentration of business in a small number of customers;  the evolving industry
and technology  standards;  the ability to protect proprietary  technology;  the
dependence  on key  personnel;  and the effect of business  interruption  due to
political unrest;  oil and gas prices; and our ability to efficiently manage our
operations.  In addition, our ability to generate long-term value for the common
stockholder is dependent upon the  acquisition of profitable  energy  prospects.
There are many companies  participating  in the oil and gas industry,  many with
greater resources.  Greater  competition for profitable  operations can increase
prices and make it more difficult to acquire  assets at reasonable  multiples of
cash flow.  We believe that we will be able to compete in this  environment  and
will be able to find  attractive  investments;  however,  it is not  possible to
predict  competition or the effect this will have on operations.  Operations are
also significantly affected by factors, which are outside our control, including
the prices of oil and natural gas,  environmental and governmental  regulations.
Accordingly,   actual  results  may  differ,   possibly  materially,   from  the
predictions contained herein.

                                                                               3
<PAGE>

                         PART I - FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS


The financial statements of the company are set forth beginning on page F-1.


ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

GENERAL

Pangea Petroleum  Corporation  ("Pangea" or "Company"),  a Colorado corporation,
was  organized  on March 11,  1997 as Zip Top,  Inc. On December  11,  1998,  we
changed  our name to Pangea  Petroleum  Corporation.  Our offices are located at
9801   Westheimer,   Suite  302,   Houston,   Texas   77042.   Our   website  is
www.pangeapetroleum.com.

Pangea is a publicly traded company listed on the OTC Electronic  Bulletin Board
under the symbol  "PAPO".  We are an independent  energy company  focused on the
exploration and development of oil and natural gas reserves, whose core business
is  directed  to the  development  of oil and gas  prospects  in proven  onshore
production areas.  Pangea is pursuing a development  program designed to achieve
profitability by distributing risk across multiple oil and gas projects.  Pangea
diversifies its risk by carefully  identifying  prospects that fit within strict
parameters and by taking a minority working interest in each project.  We devote
essentially all of our resources to development of revenue producing  activities
by keeping  overhead at a minimum  level  through  the  retention  of  carefully
selected consultants, contractors and service companies.

Pangea is  working  to create  shareholder  value by using  capital  and  proven
technology  to exploit  energy  prospects  that are of minor  interest to larger
companies  due to their size and  location.  We invest in projects at  different
levels  of  participation,  generally  as a  minority  owner,  such  that  daily
operating  responsibility is in the hands of experienced,  high quality partners
and contractors.  Producing properties may be resold as appropriate to establish
and maintain optimum asset value.

Since its  inception,  we have  recurring  losses from  operations and have been
dependent  on  existing  stockholders  and new  investors  to  provide  the cash
resources  to sustain its  operations.  During the three  months ended March 31,
2006,  we reported a loss of $245,373  while a loss of $59,090 was  reported for
the three months ended March 31, 2005.

Our long-term  viability as a going concern is dependent on certain key factors,
as follows:

-        Our ability to continue to obtain sources of outside financing to allow
         the Company to continue to make  strategic  investments  in new oil and
         gas well prospects.

-        Our ability to locate attractive development prospects,  and coordinate
         with timely funding that will allow the Company to continue to increase
         oil and gas reserves and production.

-        Our  ability to  increase  profitability  and sustain a cash flow level
         that will ensure support for continuing operations.


RESULTS OF OPERATIONS

During the first quarter of 2006, we reported  $13,591 in revenue.  This revenue
is from the interest in six producing wells.

Pangea participated in its first well in 2006 with the drilling of the Wilcox in
COLORADO  COUNTY,  TEXAS.  The well was drilled to 10,050'  during  January 2006
based on data developed from a 3D seismic survey and analysis of existing Wilcox
formation  in  the  area.  The  well  found  the  target  objective  lower  than
anticipated  in the geologic  structure  and was tested in three  intervals  and
deemed sub-commercial. Further review is being conducted to see if any locations
can be identified for drilling on the leases further up on the structure. Pangea
has a 2.0% working interest and a 1.5% net interest in the prospect

In February 2006,  Pangea purchased a 7% working interest in a re-entry workover
in  BRAZORIA  COUNTY,  TEXAS.  The well  was  drilled  in 2002  and  experienced
mechanical  difficulty in the first of four zones in the Miocene sands. The logs
indicate three additional  sands,  which will be sequentially  completed for the
project.  A workover rig moved in at the end of March.  Initial tests  indicated
that the first interval was successful in discovering gas reserves.  The well is
being connected to pipeline and the gas flow rate will be tested in May, 2006.

                                                                               4
<PAGE>

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our discussion and analysis of the financial condition and results of operations
are based upon our financial statements,  which have been prepared in accordance
with  generally  accepted  accounting  principles  in  the  United  States.  The
preparation  of these  financial  statements  requires us to make  estimates and
judgments that affect the reported amounts of assets,  liabilities,  revenue and
expenses,  and related  disclosure of contingent  assets and liabilities.  On an
ongoing  basis,  we evaluate  estimates.  We base our  estimates  on  historical
experience and on various other  assumptions  that are believed to be reasonable
under the  circumstances.  These estimates and  assumptions  provide a basis for
making  judgments about the carrying  values of assets and liabilities  that are
not readily  apparent from other  sources.  Actual results may differ from these
estimates under different  assumptions or conditions,  and these differences may
be material.

We  believe  the  following  critical   accounting   policies  affect  its  more
significant  judgments and estimates used in the preparation of its consolidated
financial statements.


OIL AND GAS PRODUCING ACTIVITIES

Pangea follows the "successful efforts" method of accounting for its oil and gas
properties.  Under this method of  accounting,  all property  acquisition  costs
(cost to acquire  mineral  interests  in oil and gas  properties)  and costs (to
drill and equip) of  exploratory  and  development  wells are  capitalized  when
incurred,  pending  determination of whether the well has found proved reserves.
If an exploratory  well has not found proved reserves in commercial  quantities,
the  costs  associated  with the well  are  charged  to  expense.  The  costs of
development   wells  are  capitalized   whether   productive  or  nonproductive.
Geological  and  geophysical  costs  and the  costs of  carrying  and  retaining
undeveloped properties are expensed as incurred. Management estimates the future
liability for plugging and abandonment of the related wells. Accordingly,  a net
cost of $7,943 has been recorded for plugging and abandonment.

Unproved  oil  and  gas  properties  that  are   individually   significant  are
periodically  assessed for impairment of value,  and a loss is recognized at the
time  of  impairment  by  providing  an  impairment  allowance.  Other  unproved
properties are amortized based on the average holding period.  Capitalized costs
of producing oil and gas properties after  considering  estimated  dismantlement
and abandonment  costs and estimated salvage values are depreciated and depleted
by the  unit-of-production  method. On the sale or retirement of a complete unit
of a proved property, the cost and related accumulated depreciation,  depletion,
and  amortization are eliminated from the property  accounts,  and the resultant
gain or loss is  recognized.  On the  retirement  or sale of a  partial  unit of
proved property, the cost is charged to accumulated depreciation, depletion, and
amortization  with a  resulting  gain or loss  recognized  in the  statement  of
operations.

On the sale of an  entire  interest  in an  unproved  property  for cash or cash
equivalent,  gain or loss on the sale is recognized,  taking into  consideration
the  amount  of any  recorded  impairment  if the  property  had  been  assessed
individually.  If a partial interest in an unproved property is sold, the amount
received is treated as a reduction of the cost of the interest retained.


OIL AND GAS REVENUES

Oil and gas revenues are recorded  under the sales method.  We recognize oil and
gas revenues as production  occurs.  As a result,  we accrue revenue relating to
production for which we have not received payment.

Since our inception,  we have suffered recurring losses from operations and have
been  dependent on existing  stockholders  and new investors to provide the cash
resources to sustain its operations.


COMPARISON  OF THREE MONTHS ENDED MARCH 31, 2006 TO THREE MONTHS ENDED MARCH 31,
2005.


The net loss of $245,373 for the three months ended March 31, 2006  increased by
$186,283 from the net loss of $59,090 for the three months ended March 31, 2005.
Most of this  difference  results from an increase in stock based  compensation.
The 2005  results  reflected  a  voluntary  suspension  of  salary  payments  to
executives in the first half of 2005.  The increase in stock based  compensation
is the result of recent changes in SEC rules which require valuation of stock as
of the date issued.

                                                                               5
<PAGE>

Pangea generated  revenue from the participation in ongoing oil and gas wells in
the amount of $13,591 for the three  months  ended March 31,  2006,  compared to
$18,998 in revenue for the three  months  ended  March 31,  2005.  This  revenue
decrease  resulted from production  problems from one of the key producing wells
and normal  declines  in other  wells  during the first  quarter of 2006.  Total
assets increased to $571,113 at March 31, 2006 compared to $238,493 at March 31,
2005. This increase is primarily reflected in oil and gas properties (successful
efforts  method),  which  increased  to $442,940  at March 31, 2006  compared to
$193,844 at March 31, 2005.

Total  liabilities at March 31, 2006 are $562,956  compared to $514,110 at March
31,  2005.  The  increase in  liabilities  are  primarily  due to an increase in
accrued liabilities related to accrued interest on notes payable.


LIQUIDITY AND CAPITAL RESOURCES

Our  operating  activities  used cash in the amount of $42,652  for the  quarter
ended March 31, 2006  related  primarily  to  professional  fees and expenses on
producing wells. We are currently generating revenue from six wells but were not
able to generate  positive cash flow from  operations for the three months ended
March 31, 2006. We utilized  cash from  financing  activities to fund  investing
activities in 2006. The net cash from financing activities increased to $185,000
at March  31,  2006  from  $25,407  at March 31,  2005.  We  intend to  continue
investing in additional  oil and gas projects but will need  additional  private
placements,  debt financing or equity  investment in order to participate  fully
and at the levels we  intend.  There can be no  assurance  that any of the plans
developed will produce cash flows sufficient to ensure its long-term viability.


OUTLOOK

Pangea has  identified  additional  prospects  scheduled for drilling in 2006 in
Colorado County, Texas;  Brazoria County, Texas;  Henderson County, Texas, White
County,  Illinois and Steuben County,  New York. In addition,  we are monitoring
activity  in  Henderson  County,  Wharton  County,  Fort Bend County and De Witt
County, Texas for possible investment.  We are also in the process of evaluating
several additional prospects for inclusion in the 2006 program.

Pangea has a 1.5% working  interest in FORT BEND COUNTY,  TEXAS,  which is a 421
acre project currently  producing  approximately  6,500 barrels of oil per month
from  fifteen  wells in the Miocene and Frio sands.  Current  plans call for the
drilling of four  additional  wells in the next six months.  Pangea will receive
revenue  from  the  project  after  payout  by  the  operator  of  drilling  and
acquisition expenses. Payout is currently expected before the end of 2006.

Pangea's  2.5%  working  interest  in STUEBEN  COUNTY,  NEW YORK,  which  covers
approximately  50,000 acres, has completed  shooting  twenty-two square miles of
3-D  seismic.  The data is being  processed  and  drilling  prospects  are being
examined.  Thus far there are two well defined drilling prospects in the Trenton
Black River and two leads identified in the Oriskany and Onandaga Reef sands.

Our prospect in WHITE COUNTY,  ILLINOIS,  which  encompasses  approximately  880
acres,  commenced  drilling in April.  The primary  target is the Warsaw Sand at
4200' with several secondary  objectives  present up to 3200'. This well will be
drilled beyond the Warsaw to  approximately  8500' to test a geologic feature in
the Trenton  Black River,  which  appears to be similar to the seismic  features
found in the successful  producing areas in New York and Michigan.  Pangea has a
3% working interest and a 2.25% net interest in the project.

COLORADO COUNTY, TEXAS is a redrill of a 10000' Wilcox well drilled in 2005 that
was idled due to  mechanical  problems.  During the third  quarter  of 2005,  we
participated  in the  successful  drilling of a 10,000'  Wilcox well in Colorado
County,  Texas. This project was developed based on 3D seismic data and analysis
of existing Wilcox  formations in the area.  Pangea has a 2.0% working  interest
and a 1.5% net interest in the prospect. The well encountered several attractive
Wilcox and Yegua sands, based on wireline log readings. The primary Wilcox sands
were tested in October with an excellent gas rate of 700 thousand cubic feet per
day;  however,  excessive  water  production  required the operator to perform a
remedial  squeeze  procedure.  Following this procedure,  the water rate was not
completely eliminated and the gas rate could not be re-established. The well was
recompiled  in the Yegua sand and yielded  600-700  MCFD with a high water rate.
Both  intervals  experienced  the water  production  due to lack of  ability  to
isolate the producing zone from  underlying  water sands.  It is believed that a
new well can cure the cementing  problems that precluded the necessary  isolaton
of the producing  sands.  In addition to the redrill,  there appear to be two to
three additional well locations that can offset the new well to produce from the
Wilcox  and  Yegua  sands  encountered  in the  first  well,  but not able to be
completed.  Review for those  locations  will be completed  after the redrill is
completed, which is anticipated to be in the third quarter of 2006.

                                                                               6
<PAGE>

HENDERSON  COUNTY,  TEXAS is an 11,500'  test in the  Rodessa  and Pettit with a
secondary  objective in the Upper Travis Peak.  The first well has the potential
for an  additional  well in the fault  trap  and,  if  successful,  will lead to
drilling in four additional analogous fault blocks on the leased acreage. Pangea
has a 2%  working  interest  and 1.54% net  interest  in the first  well.  It is
currently expected that the drilling will proceed in the third quarter of 2006.

WHARTON COUNTY,  TEXAS is a 5300' test of Frio amplitude anomalies identified in
3D  seismic  survey  data.  The  prospect  is in an  area  with  extensive  Frio
production  and has the potential for Miocene and Yegua  production as well. The
primary objective covers an estimated 400 acres and, if successful, will lead to
five to six additional drilling locations. Pangea has a 3% drilling interest and
a 2.25% working interest in the prospect, which is expected to be drilled in the
third quarter of 2006.

DE WITT  COUNTY,  TEXAS is a 4800'  test of  several  stacked  Yegua  objectives
identified  by 3D seismic  data.  The prospect is on trend with  existing  Yegua
production and there is  considerable  shallow Frio and Miocene  production that
appears  in the  area.  Two  recent 3D wells to the  south  back up the  seismic
analysis on the prospect and if successful,  the lease could provide a follow-up
location. Pangea has committed to a 6.67% working interest and a 5% net interest
in the prospect. It is expected that rig availability will allow this well to be
drilled in the fourth quarter 2006.

Pangea is actively reviewing  additional prospects in Texas and Louisiana to add
new wells to the prospect  list.  We are  continuing  our strategy of evaluating
primarily  shallow,  onshore  oil and  gas  projects  that  avoid  investing  in
"wildcat" or exploratory  wells.  Focus remains on investing in development well
prospects  that are  supported  by  seismic  data,  proven  production  from the
surrounding area and good information from adjacent wells. Additionally,  Pangea
will continue to diversify our risk by taking a minority working interest in the
prospects  such that we are not dependent on any one project or highly  impacted
by an unsuccessful well. The ability to invest further will be heavily dependent
on securing  additional  capital from investors or debt  financing.  There is no
assurance  that  additional  equity or debt financing will be available on terms
acceptable to Management.


ITEM 3.  CONTROLS AND PROCEDURES.

Charles B. Pollock,  our Chief Executive  Officer,  and Scott Duncan,  our Chief
Financial  Officer,  have concluded that our disclosure  controls and procedures
are appropriate and effective. They have evaluated these controls and procedures
as of the end of the period covered by this report on Form 10-QSB. There were no
significant  changes in our  internal  controls or in other  factors  that could
significantly  affect these controls subsequent to the date of their evaluation,
including any  corrective  actions with regard to significant  deficiencies  and
material weaknesses.


                           PART II - OTHER INFORMATION


ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During our quarter ended March 31, 2006, we completed the following transactions
in reliance upon exemptions from registration  under the Securities Act of 1933,
as amended (the "Act") as provided in Section  4(2)  thereof.  Each  certificate
issued  for  unregistered   securities  contained  a  legend  stating  that  the
securities  have  not  been  registered  under  the Act and  setting  forth  the
restrictions on the transferability and the sale of the securities.  None of the
transactions  involved  a public  offering.  We  believe  that each  person  had
knowledge and experience in financial and business  matters,  which allowed them
to evaluate the merits and risks of our securities.  We believe that each person
was knowledgeable about our operations and financial condition.


 During the three  months  ended March 31, 2006 we issued  13,700,000  shares of
common stock to two individuals under private placement  agreements and received
total  proceeds of $185,000.  In  connection  with the  issuances of  10,000,000
shares, the Company issued 7,000,000 five year warrants to acquire shares of the
Company's  common stock at $0.015.  In connection with the issuance of 3,700,000
shares,  the Company also issued 2,000,000  five-year warrants to acquire shares
of the  Company's  common  stock at $0.01 per share.  We also Issued  11,399,970
shares of common stock to employees and consultants and recognized  compensation
expense of $196,962.

                                                                               7
<PAGE>

On January 1, 2006 the  Company  entered  into an Asset  Purchase  Agreement  to
purchase  working  interests in certain oil and gas leases in Texas and New York
for  the  consideration  of  20,000,000  shares  of  common  stock.   Additional
consideration  shall be provided in the form of  5,000,000  warrants to purchase
common  stock at a price of  $.015  per  share  based on the  Company  attaining
certain monthly net revenue amounts.


ITEM  6  -  EXHIBITS

     Exhibit 31.1 - Certification of Chief Executive Officer of Pangea Petroleum
Corporation  required by Rule 13a - 14(1) or Rule 15d - 14(a) of the  Securities
Exchange Act of 1934, as adopted  pursuant to Section 302 of the  Sarbanes-Oxley
Act of 2002.

     Exhibit 31.2 - Certification of Chief Financial Officer of Pangea Petroleum
Corporation  required by Rule 13a - 14(1) or Rule 15d - 14(a) of the  Securities
Exchange Act of 1934, as adopted  pursuant to Section 302 of the  Sarbanes-Oxley
Act of 2002.

     Exhibit  32.1  --  Certification  of  Chief  Executive  Officer  of  Pangea
Petroleum  Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
and Section 1350 of 18 U.S.C. 63.

     Exhibit  32.2  --  Certification  of  Chief  Financial  Officer  of  Pangea
Petroleum  Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
and Section 1350 of 18 U.S.C. 63.

                                                                               8
<PAGE>

SIGNATURES

          Pursuant to the  requirements of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                  PANGEA PETROLEUM CORPORATION


                   By:  /s/ Charles B.  Pollock             Date: May 15, 2006
                        ------------------------------
                        Charles B.  Pollock,
                        Chairman of the Board and
                        Chief Executive Officer

                                                                               9

<PAGE>




                          PANGEA PETROLEUM CORPORATION
                                   ----------





                    UNAUDITED CONDENSED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2006 AND 2005



                                       F-1

<PAGE>


                          PANGEA PETROLEUM CORPORATION
                                TABLE OF CONTENTS
                                   ----------



                                                                           PAGE

Unaudited Condensed Financial Statements:

  Unaudited Condensed Balance Sheets as of
    March 31, 2006 and December 31, 2005                                    F-3

  Unaudited Condensed Statements of Operations
    for the three months ended March 31, 2006 and 2005                      F-4

  Unaudited Condensed Statements of Stockholders'
    Equity for the three months ended March 31, 2006                        F-5

  Unaudited Condensed Statements of Cash Flows
    for the three months ended March 31, 2006 and 2005                      F-6

Notes to Unaudited Condensed Financial Statements                           F-7



                                       F-2

<PAGE>



                          PANGEA PETROLEUM CORPORATION
                                  BALANCE SHEET
               FOR THE THREE MONTHS ENDED MARCH 31, 2006 AND 2005
                                   ----------

<TABLE>
<CAPTION>
                                                                      MARCH 31,    DECEMBER 31,
                                                                        2006            2005
     ASSETS                                                         (UNAUDITED)        (NOTE)
                                                                   ------------    ------------
<S>                                                                <C>             <C>
Current assets:
  Cash                                                             $    167,871    $     56,377
  Accounts receivable                                                       975           2,136

  Payroll taxes refundable                                                9,879           9,879

  Prepaid expenses                                                        1,625           6,500
                                                                   ------------    ------------
    Total current assets                                                180,350          74,892
                                                                   ------------    ------------

Property and equipment:
  Oil and gas properties (successful efforts method)                    442,940         242,086

  Other property and equipment                                           18,174          18,174
  Less accumulated depletion, depreciation and amortization             (70,351)        (63,368)
                                                                   ------------    ------------

    Net property and equipment                                          390,763         196,892
                                                                   ------------    ------------

      Total assets                                                 $    571,113    $    271,784
                                                                   ============    ============


LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)

Current liabilities
  Accounts payable and accrued liabilities                         $     11,348    $     40,309
  Accrued interest payable to related parties                            15,624          91,911
  Notes payable to related parties                                           --         430,053
                                                                   ------------    ------------

    Total current liabilities                                            26,972         562,273

Notes payable to related parties                                        528,041              --
Obligation for dismantlement and disposal activities                      7,943           7,943
                                                                   ------------    ------------


    Total liabilities                                                   562,956         570,216
                                                                   ------------    ------------

Commitments and contingencies

Stockholders' Equity/(deficit):
  Preferred stock: $.001 par value; 10,000,000 shares authorized             --              --
Common stock: $.001 par value; 500,000,000 shares authorized;
    267,776,856 and 222,676,886shares issued and outstanding at
    March 31, 2006 and December 31, 2005, respectively                  267,777         222,677
  Additional paid-in capital                                         17,764,040      17,257,178
  Accumulated deficit                                               (18,023,660)    (17,778,287)
                                                                   ------------    ------------

    Total stockholders' Equity/(deficit)                                  8,157        (298,432)
                                                                   ------------    ------------

      Total liabilities and stockholders' Equity/(deficit)         $    571,113    $    271,784
                                                                   ============    ============
</TABLE>



Note:  The balance  sheet at December 31, 2005 has been derived from the audited
financial  statements  at that date but does not include all of the  information
and footnotes required by generally accepted accounting  principles for complete
financial statements.


   The accompanying notes are an integral part of these financial statements.



                                      F-3


<PAGE>



                          PANGEA PETROLEUM CORPORATION
                            STATEMENTS OF OPERATIONS

               FOR THE THREE MONTHS ENDED MARCH 31, 2006 AND 2005
                                   ----------


                                                    THREE MONTHS ENDED
                                                         MARCH 31,
                                                   2006            2005
                                              -------------    -------------

Oil and gas revenue                           $      13,591    $      18,998
                                              -------------    -------------

Costs and expenses:
  Lease operating expenses                            6,310            1,830

  Production tax                                        360            2,673
  Selling, general and administrative                32,725           29,517
  Stock based compensation                          196,962           18,000
  Depletion, depreciation, and amortization           6,983           13,166

  Interest expense                                   15,624           12,902
                                              -------------    -------------

    Total costs and expenses                        258,964           78,088
                                              -------------    -------------

      Net loss                                $    (245,373)   $     (59,090)
                                              =============    =============


Basic and diluted net loss per common share   $       (0.00)   $       (0.00)
                                              =============    =============

Weighted average common shares                  254,944,549      178,598,709
                                              =============    =============



   The accompanying notes are an integral part of these financial statements.



                                       F-4

<PAGE>



                          PANGEA PETROLEUM CORPORATION
                       STATEMENT OF STOCKHOLDERS' DEFICIT
                    FOR THE THREE MONTHS ENDED MARCH 31, 2006
                                   ----------


<TABLE>
<CAPTION>
                                                                   ADDITIONAL                    STOCKHOLDERS'
                                            COMMON STOCK             PAID-IN     ACCUMULATED        EQUITY
                                        SHARES        AMOUNT         CAPITAL       DEFICIT         (DEFICIT)
                                    ------------   ------------   ------------   ------------    -------------
<S>                                  <C>           <C>            <C>            <C>             <C>
Balance at December 31, 2005         222,676,886   $    222,677   $ 17,257,178   $(17,778,287)   $    (298,432)

Common stock issued for exercise
  of warrants                         13,700,000         13,700        171,300             --          185,000

Common stock issued to compensate
  employees and consultants           11,399,970         11,400        185,562             --          196,962

Common stock issued for
  Asset Purchase Agreement            20,000,000         20,000        150,000             --          170,000

Net loss                                      --             --             --       (245,373)        (245,373)
                                    ------------   ------------   ------------   ------------    -------------

Balance at March 31, 2006            267,776,856   $    267,777   $ 17,764,040   $(18,023,660) $         8,157
                                    ============   ============   ============   ============    =============
</TABLE>



   The accompanying notes are an integral part of these financial statements.



                                       F-5

<PAGE>



                          PANGEA PETROLEUM CORPORATION
                 UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
               FOR THE THREE MONTHS ENDED MARCH 31, 2006 AND 2005
                                   ----------


                                                        2006          2005
                                                     ----------    ----------

Cash flows from operating activities:
  Net loss                                           $ (245,373)   $  (59,090)
  Adjustments to reconcile net loss to net cash
    used in operating activities                        202,721        53,733
                                                     ----------    ----------

      Net cash used in operating activities             (42,652)       (5,357)
                                                     ----------    ----------

Cash flows from investing activities:
  Capital and exploratory expenditures                  (30,854)      (14,640)
                                                     ----------    ----------

      Net cash used in investing activities             (30,854)      (14,640)
                                                     ----------    ----------

Cash flows from financing activities:
  Proceeds from the sale of common stock                185,000        25,407
                                                     ----------    ----------

      Net cash provided by financing activities         185,000        25,407
                                                     ----------    ----------

Net increase in cash and cash equivalents               111,494         5,410

Cash and cash equivalents at beginning of period         56,377        54,457
                                                     ----------    ----------

Cash and cash equivalents at end of period           $  167,871    $   59,867
                                                     ==========    ==========



   The accompanying notes are an integral part of these financial statements.



                                       F-6

<PAGE>



                          PANGEA PETROLEUM CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                                   ----------


1.     ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

       ORGANIZATION

       Pangea Petroleum  Corporation (the "Company"),  is a Colorado corporation
       engaged in oil and gas  exploration  and  development.  The  Company  was
       originally incorporated in 1997 as Zip Top, Inc. and subsequently adopted
       a name change to Pangea  Petroleum  Corporation.  On April 26, 2000,  the
       Company was  recapitalized  when the Company  acquired the  non-operating
       public  shell,  Segway  II  Corporation.  Segway  II  Corporation  had no
       significant  assets  or  liabilities  at the  date  of  acquisition  and,
       accordingly, the transaction was accounted for as a recapitalization.


2.     ACCOUNTING ESTIMATES

       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 revenue and expenses  during the  reporting
       period. Actual results could differ from those estimates. These estimates
       mainly involve the useful lives of property and equipment, the impairment
       of unproved oil and gas properties,  the valuation of deferred tax assets
       and the realizability of accounts receivable.


3.     INTERIM FINANCIAL STATEMENTS

       The accompanying  unaudited  consolidated  financial statements have been
       prepared in accordance with generally accepted accounting  principles for
       interim  financial  information and with the  instructions to Form 10-QSB
       and Article 10 of Regulation S-B. Accordingly, they do not include all of
       the information and footnotes required by generally  accepted  accounting
       principles  for  complete  financial   statements.   In  the  opinion  of
       management,  all adjustments  (consisting of normal  recurring  accruals)
       considered   necessary  for  a  fair  presentation  have  been  included.
       Operating  results  for the three month  period  ended March 31, 2006 and
       2005 are not  necessarily  indicative of the results that may be expected
       for the respective full years.

       A summary of the  Company's  significant  accounting  policies  and other
       information  necessary to understand these consolidated interim financial
       statements is presented in the  Company's  audited  financial  statements
       included in Form 10-KSB for the years ended  December  31, 2005 and 2004.
       Accordingly, the Company's audited financial statements should be read in
       connection with these financial statements.


4.     GOING CONCERN CONSIDERATIONS

       Since its  inception,  the Company  has  suffered  recurring  losses from
       operations  and has  been  dependent  on  existing  stockholders  and new
       investors to provide the cash resources to sustain its operations. During
       the three months ended March 31, 2006 and 2005, the Company  reported net
       losses of $245,373 and $59,090, respectively.



                                       F-7

<PAGE>

                          PANGEA PETROLEUM CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                                   ----------


4.     GOING CONCERN CONSIDERATIONS, CONTINUED

       The Company  has  developed a  multi-step  plan and has taken  actions to
       improve its financial position and deal with its liquidity problems.  The
       final  steps of the plan  are  still  being  developed,  but may  include
       additional private  placements of the Company's common stock,  additional
       oil and gas property acquisitions and/or exploration efforts, and efforts
       to raise additional debt financing or equity investments. There can be no
       assurance  that any of the plans  developed  by the Company  will produce
       cash  flows  sufficient  to ensure  its  long-term  viability  as a going
       concern.

       The Company's long-term viability as a going concern is dependent on
       certain key factors, as follows:

              o      The Company's ability to obtain adequate sources of outside
                     financing to support near term operations and to allow the
                     Company to continue forward with current strategic plans.

              o      The Company's ability to locate, prove and produce from
                     economically viable oil and gas reserves.

              o      The Company's ability to ultimately achieve adequate
                     profitability and cash flows to sustain continuing
                     operations.


5.     INCOME TAXES

       The Company has incurred losses since its inception and,  therefore,  has
       not been  subject to federal  income  taxes.  As of March 31,  2006,  the
       Company  had net  operating  loss  ("NOL")  carryforwards  for income tax
       purposes of  approximately  $6,561,124  which expire in various tax years
       through 2025. Under the provisions of Section 382 of the Internal Revenue
       Code,  the net  operating  loss  carryforwards  attributable  to a former
       subsidiary and other losses incurred prior to the ownership change in the
       Company when it  recapitalized  in 2000 will severely limit the Company's
       ability to utilize its NOL  carryforward  to reduce future taxable income
       and related tax liabilities. Additionally, because United States tax laws
       limit the time  during  which NOL  carryforwards  may be applied  against
       future taxable income,  the Company will be unable to take full advantage
       of a  substantial  portion of its NOL for  federal  income  tax  purposes
       should the Company generate taxable income.

       The  difference  between  the  income  tax  benefit  in the  accompanying
       statement  of  operations  and the amount  that would  result if the U.S.
       federal  statutory  rate of 34% were applied to pre-tax loss for the year
       ended  March 31, 2006 and 2005  relates  primarily to increases in the
       valuation  allowances  for deferred tax assets  related to net  operating
       losses and non deductible stock based compensation.


6.     STOCKHOLDERS' EQUITY

       During the three  months  ended March 31,  2006,  the Company  engaged in
       various transactions affecting stockholders' equity, as follows:

            o     Issued  13,700,000  shares of common stock to two  individuals
                  under private placement agreements and received total proceeds
                  of $185,000.  In  connection  with the issuances of 10,000,000
                  shares,  the Company  issued  7,000,000  five year warrants to
                  acquire  shares of the  Company's  common stock at $0.015.  In
                  connection with the issuance of 3,700,000 shares,  the Company
                  also issued 2,000,000  five-year warrants to acquire shares of
                  the Company's common stock at $0.01 per share.

            o     Issued  11,399,970  shares of common  stock to  employees  and
                  consultants  and recognized  compensation  expense of $196,962
                  based on market value on date of issuance.



                                       F-8

<PAGE>

                          PANGEA PETROLEUM CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                                   ----------


7.     ASSET PURCHASE AGREEMENT


       On January 1, 2006 the Company  entered into an Asset Purchase  Agreement
       to purchase working  interests in certain oil and gas leases in Texas and
       New York for the consideration of 20,000,000 shares of common stock value
       at  $170,000  based  on  market  value  on date of  issuance.  Additional
       consideration  shall be  provided  in the form of  5,000,000  warrants to
       purchase  common stock at a price of $.015 per share based on the Company
       attaining certain monthly net revenue amounts.


8.     RELATED PARTY TRANSACTIONS

       The  Company has various  related  party notes  payable at March 31, 2006
       totaling  $528,041 and related accrued  interest of $15,624.  The Company
       replaced these notes payable  including accrued interest through December
       31,  2005,  effective  January 1, 2006 with new notes at 12% due December
       31, 2007.


9.     NON EMPLOYEE DIRECTOR COMPENSATION

        Effective  July 1,  2005,  the  Company's  board of  directors  approved
        compensation  for non employee  directors of 100,000  common  shares per
        quarter and 100,000  common shares per meeting.  Also the board approved
        compensation  for non board member officers who participate in the board
        meetings of 100,000  common shares per meeting.  During the three months
        ended March 31, 2006, the Company issued 100,000 shares valued at $770.

10.   NON-CASH INVESTING ACTIVITIES

       During  the  three  months  ended  March 31,  2006,  the  Company  issued
       20,000,000 common shares valued at $170,000 based on market value on date
       of issuance to acquire oil and gas properties.



                                       F-9