**EXHIBIT 11**

 

**GATEWAY ENERGY CORPORATION & SUBSIDIARIES**

 

**STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS**

 
|                                                                                                                            |   | **Three Months Ended****June 30,** |     | **Six Months Ended****June 30,** |   |
|---------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|----------|----------------------------------|--------|
|                                                                                                                            |   | **2004**                           |     | **2003**                         |   | **2004** |   | **2003** |   |
| Weighted average number of  common shares outstanding                                                                           |   | 15,714,442                         |     | 15,426,317                       |   | 15,700,320 |   | 15,426,317 |   |
|                                                                                                                            |   |                               |     |                             |   |   |   |   |   |
| Add shares issuable pursuant to common  stock options/warrants less shares assumed repurchased at the average market  price (1) |   | 31,243                             |     | 32,292                           |   | 36,082 |   | 27,082 |   |
|                                                                                                                            |   |                               |     |                             |   |   |   |   |   |
| Tentative numer of shares for computation  of fully diluted earnings per share                                                  |   | 15,715,685                         |     | 15,458,609                       |   | 15,736,402 |   | 15,453,399 |   |
|                                                                                                                            |   |                               |     |                             |   |   |   |   |   |
| Loss from continuing operations                                                                                                 |   | $                                  | (321,864 | )                                | $      | (441,462 | ) | $ | (401,613 | ) | $ | (506,627 | ) |
| Discontinued operations                                                                                                         |   | (1,224                             | )        | —                           |   | 42,480 |   | — |   |
| Loss before cumulative effect of change in  accounting principle                                                                |   | $                                  | (323,088 | )                                | $      | (441,462 | ) | $ | (359,133 | ) | $ | (506,627 | ) |
| Cumulative effect of change in accounting  principle                                                                            |   | —                             |     | —                           |   | — |   | (105,777 | ) |
| Net loss                                                                                                                        |   | $                                  | (323,088 | )                                | $      | (441,462 | ) | $ | (359,133 | ) | $ | (612,404 | ) |
|                                                                                                                            |   |                               |     |                             |   |   |   |   |   |
| Basic and diluted loss per common share:                                                                                        |   |                               |     |                             |   |   |   |   |   |
| Continuing operations                                                                                                           |   | $                                  | (0.02    | )                                | $      | (0.03 | ) | $ | (0.02 | ) | $ | (0.03 | ) |
| Discontinued operations                                                                                                         |   | —                             |     | —                           |   | — |   | — |   |
| Cumulative effect of change in accounting  principle                                                                            |   | —                             |     | —                           |   | — |   | (0.01 | ) |
| Net loss                                                                                                                        |   | $                                  | (0.02    | )                                | $      | (0.03 | ) | $ | (0.02 | ) | $ | (0.04 | ) |

 

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(1) These figures are not usedin the diluted earnings per share calculations as their effect would beantidilutive.

 

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