SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

            QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005

                            Commission File #0-30503

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

                                    COLORADO
         (State or other jurisdiction of incorporation or organization)

                                   76-0635938
                      (IRS Employer Identification Number)

                9801 Westheimer, Suite 302, Houston, Texas 77042
               (Address of principal executive offices)(Zip Code)

                                 (713) 706-6350
                (Registrant's telephone no., including area code)


Check whether  issuer (1) has filed all reports  required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 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 [ ]

The number of shares outstanding of the Company's common stock as of May 9, 2005
is shown below:

Title of Class Number of Shares  Outstanding  Common Stock,  $.001 par value per
share 182,919,846

Documents Incorporated by Reference: None


                                       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  1  -  Legal Proceedings

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,
2004.

The Company is 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.  Certain
statements  contained herein are  forward-looking  statements and,  accordingly,
involve risks and uncertainties  which could cause actual results or outcomes to
differ materially from those expressed in the forward-looking statements.

The Company's expectations,  beliefs and projections are expressed in good faith
and are believed by the Company to have a reasonable  basis,  including  without
limitations,  management's  examination  of historical  operating  trends,  data
contained in the Company's  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, in the view of the Company,  could cause actual  results to differ
materially from those discussed in the forward-looking  statements:  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.  The
Company has no obligation to update or revise these  forward-looking  statements
to reflect the occurrence of future events or circumstances.

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.  The Company undertakes no obligation to publicly revise these
forward-looking  statements to reflect  events or  circumstances  that may arise
after the date  hereof.  Additionally,  these  statements  are based on  certain
assumptions  that may prove to be  erroneous  and are  subject to certain  risks
including,  but not  limited  to,  the  Company's  dependence  on  limited  cash
resources,  its dependence on certain key personnel within the Company,  and its
ability to raise additional capital. The Company's 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 resources greater than the Company.  Greater competition for
profitable  operations can increase prices and make it more difficult to acquire
assets at reasonable  multiples of cash flow. The Company  believes that it 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 the Company's  operations.  The Company's  operations are also
significantly affected by factors, which are outside the control of the Company,
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.


<PAGE>

                          PANGEA PETROLEUM CORPORATION

                                   ----------


              UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004




                                       F-1

<PAGE>

                          PANGEA PETROLEUM CORPORATION
                                TABLE OF CONTENTS

                                   ----------


                                                                           PAGE

Unaudited Consolidated Condensed Financial Statements:

  Unaudited Consolidated Condensed Balance Sheets as of
    March 31, 2005 and December 31, 2004                                   F-3

  Unaudited Consolidated Condensed Statements of Operations
    for the three months ended March 31, 2005 and 2004                     F-4

  Unaudited Consolidated Condensed Statements of Stockholders'
    Equity for the three months ended March 31, 2005                       F-5

  Unaudited Consolidated Condensed Statements of Cash Flows
    for the three months ended March 31, 2005 and 2004                     F-6

Notes to Unaudited Consolidated Condensed Financial Statements             F-7



                                       F-2

<PAGE>

                          PANGEA PETROLEUM CORPORATION
                 UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEET
                      MARCH 31, 2005 AND DECEMBER 31, 2004

                                   ----------

<TABLE>
<CAPTION>
                                                                     MARCH 31      DECEMBER 31,
                                                                       2005            2004
     ASSETS                                                         (UNAUDITED)       (NOTE)
                                                                   ------------    ------------
<S>                                                                <C>             <C>
Current assets:
  Cash                                                             $     59,867    $     54,457
  Accounts receivables                                                   11,740          11,877
  Payroll taxes refundable                                                9,879           9,879
                                                                   ------------    ------------

      Total current assets                                               81,486          76,113
                                                                   ------------    ------------

Property and equipment:
  Oil and gas properties (successful efforts method)                    193,844         179,204
  Other property and equipment                                           18,174          18,174
  Less accumulated depletion, depreciation and amortization             (55,011)        (41,845)
                                                                   ------------    ------------

  Net property and equipment                                            157,007         155,533
                                                                   ------------    ------------

      Total assets                                                 $    238,493    $    231,746
                                                                   ============    ============

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
  Accounts payable                                                 $      1,666    $      2,138
  Accrued liabilities                                                    73,978          51,076
  Notes payable to related parties                                      415,053         415,053
                                                                   ------------    ------------

      Total current liabilities                                         490,697         468,267

Obligation for dismantlement and disposal activities                      8,413           8,413

Notes payable to related parties, net of current portion                 15,000          15,000
                                                                   ------------    ------------

      Total liabilities                                                 514,110         491,680
                                                                   ------------    ------------

Commitments and contingencies

Stockholders' deficit:
  Preferred stock: $.001 par value; 10,000,000 shares authorized             --              --
  Common stock: $.001 par value; 200,000,000 shares authorized;
    180,919,846 and 175,694,413 shares issued and outstanding
    at March 31, 2005 and December 31, 2004, respectively               180,920         175,694
  Additional paid-in capital                                         16,651,497      16,615,316
  Unissued common stock: 1,440,500 shares                               192,833         192,833
  Deferred compensation                                                      --          (2,000)
  Accumulated deficit                                               (17,300,867)    (17,241,777)
                                                                   ------------    ------------

      Total stockholders' deficit                                      (275,617)       (259,934)
                                                                   ------------    ------------

        Total liabilities and stockholders' deficit                $    238,493    $    231,746
                                                                   ============    ============
</TABLE>


Note:  The balance  sheet at December 31, 2004 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
             unaudited consolidated condensed financial statements.

                                       F-3

<PAGE>

                          PANGEA PETROLEUM CORPORATION
            UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
               FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004

                                   ----------


                                                        THREE MONTHS ENDED
                                                              MARCH 31,
                                                    ---------------------------
                                                       2005            2004
                                                    -----------     -----------

Oil and gas revenue                                 $    18,998     $    18,928
                                                    -----------     -----------

Costs and expenses:
  Lease operating expenses                                1,830           2,231
  Production tax                                          2,673           1,386
  Selling, general and administrative                    29,517         101,901
  Stock based compensation                               18,000          21,300
  Depletion, depreciation, and amortization              13,166           2,798
  Interest expense                                       12,902           9,922
                                                    -----------     -----------

    Total costs and expenses                             78,088         139,538
                                                    -----------     -----------

      Net loss                                      $   (59,090)    $  (120,610)
                                                    ===========     ===========

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

Weighted average common shares                      178,598,709     139,215,023
                                                    ===========     ===========



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

                                       F-4

<PAGE>

                          PANGEA PETROLEUM CORPORATION
       UNAUDITED CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS' DEFICIT
                    FOR THE THREE MONTHS ENDED MARCH 31, 2005

                                   ----------


<TABLE>
<CAPTION>
                                                                                                                           TOTAL
                                                                ADDITIONAL    UNISSUED                                 STOCKHOLDERS'
                                          COMMON STOCK           PAID-IN       COMMON     ACCUMULATED     DEFERRED        EQUITY
                                       SHARES       AMOUNT       CAPITAL       STOCK        DEFICIT     COMPENSATION     (DEFICIT)
                                    -----------   ---------   ------------   ---------   ------------    ----------    -----------
<S>                                 <C>           <C>         <C>            <C>         <C>             <C>           <C>
Balance at December 31, 2004        175,694,413   $ 175,694   $ 16,615,316   $ 192,833   $(17,241,777)   $   (2,000)   $  (259,934)

Common stock issued for cash          3,285,000       3,285         18,715          --             --            --         22,000

Common stock issued to compensate
  employees and consultants           1,600,000       1,600         14,400          --             --         2,000         18,000

Common stock issued for
  exercise of warrants                  340,433         341          3,066          --             --            --          3,407

Net loss                                     --          --             --          --        (59,090)           --        (59,090)
                                    -----------   ---------   ------------   ---------   ------------    ----------    -----------

Balance at March 31, 2005           180,919,846   $ 180,920   $ 16,651,497   $ 192,833   $(17,300,867)   $       --    $  (275,617)
                                    ===========   =========   ============   =========   ============    ==========    ===========
</TABLE>


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

                                       F-5

<PAGE>

                          PANGEA PETROLEUM CORPORATION
                 UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
               FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004

                                   ----------

<TABLE>
<CAPTION>
                                                                  2005              2004
                                                               ----------        ----------
<S>                                                            <C>               <C>
Cash flows from operating activities:
  Net loss                                                     $  (59,090)       $ (120,610)
  Adjustments to reconcile net loss to net cash
    used in operating activities                                   53,733            95,309
                                                               ----------        ----------

        Net cash used in operating activities                      (5,357)          (25,301)
                                                               ----------        ----------

Cash flows from investing activities:
  Capital and exploratory expenditures                            (14,640)          (10,500)
                                                               ----------        ----------

        Net cash used in investing activities                     (14,640)          (10,500)
                                                               ----------        ----------

Cash flows from financing activities:
  Proceeds from the sale of common stock and stock options         25,407           141,000
                                                               ----------        ----------

        Net cash provided by financing activities                  25,407           141,000
                                                               ----------        ----------

Net increase (decrease) in cash and cash equivalents                5,410           105,199

Cash and cash equivalents at beginning of period                   54,457             1,890
                                                               ----------        ----------

Cash and cash equivalents at end of period                     $   59,867        $  107,089
                                                               ==========        ==========
</TABLE>


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

                                       F-6

<PAGE>

                          PANGEA PETROLEUM CORPORATION
         NOTES TO UNAUDITED CONSOLIDATED CONDENSED 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, 2005 and
       2004 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, 2004 and 2002.
       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, 2005 and 2004, the Company  reported net
       losses of $59,090 and $120,610, respectively.

       Continuing  negative operating results produced a working capital deficit
       of $409,211 and a stockholders' deficit of $63,978 as of March 31, 2005.


                                       F-7

<PAGE>

                          PANGEA PETROLEUM CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   ----------

4.     GOING CONCERN CONSIDERATIONS, CONTINUED

       The  Company  developed a  multi-step  plan and during 2003 and 2004 took
       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.


6.     INCOME TAXES

       The Company has incurred losses since its inception and,  therefore,  has
       not been  subject to federal  income  taxes.  As of March 31,  2005,  the
       Company  had net  operating  loss  ("NOL")  carryforwards  for income tax
       purposes of  approximately  $6,472,000  which expire in various tax years
       through 2024. 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 three
       months  ended March 31, 2005 and 2004  relates  primarily to increases in
       the valuation allowances for deferred tax assets related to net operating
       losses and non deductible stock based compensation.


7.     STOCKHOLDERS' EQUITY

       During the three  months  ended March 31,  2005,  the Company  engaged in
       various transactions affecting stockholders' equity, as follows:

            o     Issued 3,285,000  shares of common stock to individuals  under
                  private  placement  agreements  and received total proceeds of
                  $22,000.  In connection  with on of the issuances of 2,285,000
                  shares,  the Company also issued 1,370,000  five-year warrants
                  to acquire shares of the Company's  common stock at $0.007 per
                  share.

            o     Issued  340,433 share of common stock for $3,407 upon exercise
                  of stock warrants.

            o     Issued  600,000  shares  of  common  stock  to  employees  and
                  recognized compensation expense of $6,000

            o     Issued  1,000,000  shares of  common  stock to  related  party
                  consultants and recognized consulting expense of $10,000


                                       F-8

<PAGE>

                          PANGEA PETROLEUM CORPORATION
         NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

                                   ----------

8.     RELATED PARTY TRANSACTIONS

       During  the  three  months  ended  March 31,  2005,  the  Company  issued
       1,000,000  shares  of  common  stock and  recognized  consulting  fees of
       $10,000  under  a  consulting  agreement  with  stockholders  to  provide
       record-keeping and other administrative services

       In addition to the transactions and balances described above, the Company
       has  various  related  party  notes  payable at March 31,  2005  totaling
       $430,053 and related accrued interest of $55,997.


                                       F-9

<PAGE>

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,  the
Company  changed  its 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". The Company is 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. The
Company  devotes  essentially  all of its  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.  The Company  invests 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,  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, 2005 the  Company  reported a loss of $56,106  while a loss of $120,610  was
reported for the three months ended March 31, 2004.

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

      -     The  Company's  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.

      -     The Company's  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.

      -     The Company's  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 2005, the Company reported $18,998 in revenue.  This
revenue is from the Company's interest in four producing wells. A fifth well was
added in April as noted below.

During the first  quarter the Company had new activity in SAN  PATRICIO  COUNTY,
TEXAS. This is a project that consists of two wells that are based on 3D seismic
data in the  Miocene  sands.  These wells are in a prolific  Miocene  production
trend and tap into potentially  unproduced  channel sands in the area. The first
well was drilled in December and  encountered  a productive  sand.  The well was
completed  and in January 2005 the well was placed on  production at the rate of
130 MCFD.  The second  well was  drilled to the  Miocene  in  February  2005 and


                                       4
<PAGE>

encountered  the  expected  intervals  with  an  analysis  that  they  contained
sub-commercial reserves. The well was abandoned without attempting a completion.
Pangea has a 4.25%  working  interest  and a 3.275% net  interest in the project
area.

In  January  2005,  Pangea  entered  into an  agreement  with  Titan Oil and Gas
Corporation to purchase an interest in a LAVACA COUNTY, TEXAS well. This well is
a 3500' Frio prospect that was successfully drilled and logged in early January.
Pangea has a 2.0% working interest and a 1.5% net interest in the prospect.  The
well was  completed  in  February  2005 and had an extended  production  test at
pipeline  conditions  and  produced at the rate of 260 mcf per day. The well was
placed on production in April 2005 and is currently producing 200 mcf per day.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company's  discussion and analysis of its financial condition and results of
operations are based upon its consolidated financial statements, which have been
prepared in accordance  with  generally  accepted  accounting  principles in the
United  States.  The  preparation  of these  financial  statements  requires the
Company 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,  the  Company  evaluates  its
estimates.  The Company  bases its  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.

The Company believes 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

The Company  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 $8,413 has been recorded as of the end of 2004 and March 31, 2005.

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  Company's  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. The Company recognizes
oil and gas revenues as  production  occurs.  As a result,  the Company  accrues
revenue relating to production for which the Company has not received payment.

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.


                                       5
<PAGE>

COMPARISON  OF THREE MONTHS ENDED MARCH 31, 2005 TO THREE MONTHS ENDED MARCH 31,
2004.

The net loss of $59,090 for the three months  ended March 31, 2005  decreased by
$61,520 from the net loss of $120,610 for the three months ended March 31, 2004.
The decrease is a result of the reduction in stock based compensation  resulting
from a restructuring of executive contracts.

The Company  generated  revenue  from the  participation  in ongoing oil and gas
wells in the  amount of  $18,998  for the three  months  ended  March 31,  2005,
compared to $18,928 in revenue in the three months  ended March 31, 2004.  Total
assets  increased to $238,493 at March 31, 2005 compared to $231,746 at December
31, 2004 which is primarily reflected in an increase in cash to $59,867 at March
31, 2005  compared to $54,457 at  December  31, 2004 and oil and gas  properties
(successful  efforts  method)  which  increased  to  $193,844  at March 31, 2005
compared to $179,204 at December 31, 2004.

Total  liabilities  at March 31,  2005 are  $514,110  compared  to  $491,680  at
December 31, 2004,  which is an increase in total  liabilities  of $22,430.  The
increase in liabilities  is primarily due to an increase in accrued  liabilities
($73,978 at March 31, 2005 compared to $51,076 at December 31, 2004), related to
accrued interest on notes payable and service accruals.

LIQUIDITY AND CAPITAL RESOURCES

The  Company's  operating  activities  used cash in the amount of $5,357 for the
quarter ended March 31, 2005 related primarily to professional fees and expenses
on producing wells. The Company is currently  generating revenue from five wells
but was not able to generate  positive cash flow from operations for the quarter
ended March 31, 2005.  The Company  utilized cash from  financing  activities to
fund  investing  activities  in 2004.  The net cash  from  financing  activities
decreased  year-to-date  in 2005 to $22,000 from  $141,000 at December 31, 2004.
The Company intends 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 the Company intends.  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.

OUTLOOK

Pangea has identified four additional  prospects  scheduled for drilling in 2005
in Henderson County Texas,  Colorado County,  Texas, Panola County, Texas and De
Witt County  Texas.  The Company is also in the  process of  evaluating  several
additional prospects for 2005.

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
to prove up 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
expects to have a 2% working  interest and 1.54% net interest in the first well.
This well is expected to be ready for drilling early in the third quarter 2005.

COLORADO  COUNTY,  TEXAS is a 10,000' test of the Wilcox.  This project has been
developed based on 3D seismic data and analysis of existing Wilcox  formation in
the area.  Pangea has a 2.0%  working  interest  and a 1.5% net  interest in the
prospect.  The operator of the well has indicated that budgetary constraints and
rig availability make the most likely drilling time frame in July 2005.

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 early 2005.

PANOLA COUNTY, TEXAS is a 10,000' Wilcox test set up by a geologic trap that has
produced in nearby fault blocks.  The prospect  also has Travis Peak  potential.
The well is on the same lease as existing Pangea  production in the Upper Travis
Peak interval.  Plans are being finalized and a final participation  decision by
Pangea has not been  made,  pending  development  and  review of  detailed  cost


                                       6
<PAGE>

estimates.  If the Company does elect to participate it will have the right to a
5% working  interest and a 3.75% net interest in the well.  Based on current rig
availability,  it is not expected that this well will be drilled until the third
quarter 2005.

Pangea is actively reviewing additional prospects in Texas and Louisiana, to add
new wells to the  prospect  list.  The  Company is  continuing  its  strategy of
evaluating primarily shallow,  onshore oil and gas projects that avoid investing
in "wildcat" or exploratory wells, and focusing 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 its risk by taking a minority working interest in the
prospects,  such that the Company is 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

Pursuant to the Instructions on Part II of the Form 10-QSB, Items 3, 4 and 5 are
omitted.

ITEM 1.  LEGAL PROCEDINGS

On May 7, 2004,  the Company was awarded  $158,000.00 in its  arbitration  claim
against  Clay  Exploration,  Inc.  and  Joseph W.  Shunta  pertaining  to a well
interest in Duval County,  Texas.  On September 8, 2004,  Pangea  entered into a
settlement  agreement  with Clay  Exploration  whereby Clay agreed to pay Pangea
$80,000 and release Pangea from any claims,  in exchange for a full release from
Pangea. The amount was paid in the 4th quarter 2004. Pangea has entered into two
Forbearance  Agreements with Joseph W. Shunta.  The first agreement was executed
in December 2004 and provided covered from January 2005 to June 2005. The second
signed  Forbearance  Agreement  is dated  March 23, 2005 and extends the payment
period to December 2005. Mr. Shunta agreed to withdraw an appeal of the judgment
confirming the award,  allowing the judgment to become final,  and agreed to pay
$2,000 per month for the 12 month  period,  while he arranges to pay the balance
of the  judgment.  In  exchange,  Pangea  agreed to refrain  from  executing  on
property liens filed by Pangea on Mr.  Shunta's real estate  holdings during the
Forbearance period. In addition,  Pangea has agreed to release liens so that Mr.
Shunta could sell two of the  properties  that had negative cash flow and no net
asset value, in exchange for an additional $2,000 payment.  Pangea is continuing
to work with Mr. Shunta to fully satisfy the entire claim amount.  To date $8000
has been paid by Mr. Shunta; however, at this time it is uncertain as to whether
the full amount of the settlement due will be collected.

As of the date hereof,  Pangea is not a party to any further legal  proceedings,
and none are known to be contemplated against Pangea.

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

During our quarter ended March 31, 2005, 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.


                                       7
<PAGE>

A total of 3,285,000 shares were issued for private  placements to two investors
for a total of $22,000.  In  connection  with one of the  issuances of 2,285,000
shares,  the Company also issued 1,370,000  five-year warrants to acquire shares
of the Company's common stock at $0.007 per share.

The Company issued 340,333 shares of common stock to two investors upon exercise
of warrants.

The Company  issued  1,600,000  shares of common stock to two  employees and two
outside consultants and recognized total compensation expense of $16,000.

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.



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 11, 2005
                      -----------------------------
                      Charles B.  Pollock,
                      Chairman of the Board and
                      Chief Executive Officer



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