UNITED
STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C.
20549




Form
10-K




(Mark
One)




x ANNUAL REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE


ACT
OF 1934




For
the Fiscal Year Ended December 31, 2008




or




o TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES


EXCHANGE
ACT OF 1934




Commission
File Number: 0-30303




GLOBAL
CLEAN ENERGY, INC.


(Exact
name of registrant as specified in its charter)


Maryland
                            
                            No.
      84-1522846(State
      or other jurisdiction of incorporation or organization)
                            
                            (I.R.S.
      Employer Identification No.)1241
      S. Parker Rd. #201, Denver, CO
                            
                            80023(Address
      of principal executive offices)
                            
                            (Zip
      Code)
  Registrant's
telephone number, including area code:
 (303)-369-5562
  Securities
registered pursuant to Section 12(b) of the Act:
  Title
      of Each Class
                      
                      Name
      of Each Exchange on Which RegisteredNone
                      
                      None
  Securities
registered pursuant to Section 12(g) of the Act:
  Common
      Stock, par value $.001 per share(Title
      of Class)(Title
      of
Class)


Indicate
by check mark whether the registrant is a well-known seasoned issuer, as defined
in Rule 405 of the Securities Act. Yes o No x




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Act. Yes o No x




Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months, and (2) has been subject to the filing requirements for at
least the past 90 days. Yes x No o




Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. o




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act (Check one):





Large
      accelerated filer
              o
              Accelerated
      filer
              oNon-accelerated
      filer
                (Do
      not check if a smaller reporting company)
              o
              Smaller
      reporting company
              x


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




The
aggregate market value of the registrant’s common stock held by non-affiliates
of the registrant on March 27, 2009, was $809,122 (based on the closing sales
price of the registrant’s common stock on that date).  Shares of the
registrant’s common stock held by each officer and director and each person who
owns more than 5% of the outstanding common stock of the registrant have been
excluded in that such persons may be deemed to be affiliates.  This
determination of affiliate status is not necessarily a conclusive determination
for other purposes.




25,378,721
shares of Common Stock were outstanding at March 27, 2009.










INDEX
TO FORM 10-K ANNUAL REPORT





Page





PART
      I
                                                            4Item
      1. Business
                                                            4Item
      1A. Risk Factors
                                                            12Item
      1B. Unresolved Staff Comments
                                                            20Item
      2. Properties
                                                            20Item
      3. Legal Proceedings
                                                            20Item
      4. Submission of Matters to a Vote of Security Holders
                                                            20PART
      II
                                                            20Item
      5. Market for Registrant’s Common Equity and Related Stockholder Matters
      and Issuer Purchases of Equity Securities.
                                                            20Item
      6. Selected Financial Data
                                                            21Item
      7. Management’s Discussion and Analysis of Financial Condition and Results
      of  Operations
                                                            22Item
      7A. Quantitative and Qualitative Disclosures About Market
    Risk
                                                            23Item
      8. Financial Statements
                                                            23Item
      9. Changes in and Disagreements With Accountants on Accounting and
      Financial Disclosure
                                                            23Item
      9A. (T). Controls and Procedures.
                                                            23Item
      9B. Other Information
                                                            24Item
      10. Directors, Executive Officers, Promoters and Corporate
      Governance
                                                            24Item
      11. Executive Compensation
                                                            26Item
      12. Security Ownership of Certain Beneficial Owners and Management and
      Related Stockholder Matters
                                                            28Item
      13. Certain Relationships and Related Transactions, and Director
      Independence
                                                            29Item
      14. Principal Accountant Fees and Services
                                                            30Item
      15. Exhibits, Financial Statement Schedules
                                                            30
   i




FORWARD-LOOKING
STATEMENTS




This
report contains forward-looking statements and information relating to us that
is based on the beliefs of our management as well as assumptions made by, and
information currently available to, our management. When used in this report,
the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan” and
similar expressions, as they relate to us or our management, are intended to
identify forward-looking statements. These statements reflect management’s
current view of us concerning future events and are subject to certain risks,
uncertainties and assumptions, including among many others:




·
            the
      availability and adequacy of our cash flow to meet our
      requirements;




·
            economic,
      competitive, demographic, business and other conditions in our local and
      regional markets;




·
            changes
      or developments in laws, regulations or taxes in the renewable energy
      industries;




·
            actions
      taken or not taken by third-parties, including our competitors, as well as
      legislative, regulatory, judicial and other governmental
      authorities;




·
            competition
      in the renewable energy industry;




·
            the
      failure to obtain or loss of any license or
  permit;




·
            the
      cyclical nature of the energy industry, and therefore any downturns in
      this cyclical industry could adversely affect
  operations;




·
            the
      energy-related industry that we service is heavily regulated and the costs
      associated with such regulated industries increases the costs of doing
      business;




·
            the
      ability to carry out our business plan and to manage our growth
      effectively and efficiently;




·
            the
      failure to manage any foreign exchange risk
  adequately;




·
            a
      general economic downturn or a downturn in the securities markets;
      and




·
            risks
      and uncertainties described in the Risk Factors section or elsewhere in
      this Annual Report on Form 10-K.




Should
any of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those
described in this report as anticipated, estimated or expected. All written and
oral forward-looking statements attributable to us or persons acting on our
behalf subsequent to the date of this Annual Report are expressly qualified in
their entirety by the foregoing risks and those set forth in the “Risk Factors”
section below.




When used
in this report, the terms “Global Clean Energy,” “Company,” “GCE,” “we,” “our”
and “us” refer to Global Clean Energy, Inc.




3




PART
I




ITEM 1.
BUSINESS




OUR  MISSION




“It begins with energy... clean,
renewable energy will lead the 21st century. But to truly transform our economy,
protect our security, and save our planet from the ravages of climate change, we
need to ultimately make clean, renewable energy the profitable kind of
energy...   to develop technologies like wind power and solar
power; advanced biofuels, clean coal, and more.”




Barack
Obama, Presidential Address to United States Congress, February 24,
2009




Global
Clean Energy was formed to develop and commercialize proprietary “R.E.S.C.U.E”
technologies which recover and reform environmental salvage into clean useable
energy.  As global reserves diminish, biodiesel and other synthetic
fuels are now regarded as realistic alternatives to oil. The combination of
fears about declining conventional oil reserves, increasing demand from
developing countries like India and China, and dependence on unstable suppliers
in the Middle East and elsewhere, has generated tremendous interest in
developing alternative energy sources.  GCE is at the forefront of
global initiatives to reduce greenhouse gas emissions and lower the dependency
in the USA and Europe on imported oil and natural gas with its proprietary and
innovative technologies for clean coal and other renewable energy
sources.




We work
with both the governmental and private sectors on projects which seek to
implement profitable renewable energy while cleaning specific environmental
problem areas. What began as a search for best of breed technologies to convert
waste and biomass into clean renewable energy, has evolved and expanded into
five areas of active business development: (i) research and development of new
technologies; (ii) international joint-ventures to develop waste-to-energy
projects; (iii) technology and services for environmental ash cleanup
operations; (iv) renewable energy production; and (v) seeking public financing
for projects in the green energy sector.




We own a
propriety AirpumpTM which
allows recovery of submerged bio-waste.  The AirpumpTM has
been successfully tested in removing coal ash from slurry ponds and waste water
from water treatment ponds.  The recovered waste can be converted into
usable energy.  We are also negotiating to acquire a hybrid
gasification system which will allow for the conversion of waste into synthetic
gas and other forms of clean energy such as ethanol and butane.  This
technology will be used to create sustainable power facilities (in the 5 to 100
megawatt range) using the bio-waste that has been harvested, which we plan to
build, own and operate.




In 2009,
we expect to commence three renewable energy projects to take advantage of our
proprietary technologies.  Our three planned projects span the base of
our operations: the United States, Canada and the United Kingdom.  All
of the planned projects are joint ventures, comprised of municipal, state and
federal institutions, universities, private banking and public
financing.  The projects directly address local priorities for
economic development, energy creation and environmental concerns and are as
follows:




Project
USA:  In Southern Texas, on the Gulf of Mexico we are negotiating to
develop a more than 1500 acre site for the growing of oil rich algae and
jatropha plants which can easily be converted into biodiesel or jet
fuel.




Project
Canada:  We have outlined an understanding with a Quebec municipality
to implement and showcase the gasification technology.  Through this
project we will be converting garbage such as industrial solid waste and
municipal solid waste into synthetic gas, or Syngas, which can be used by the
municipality to operate municipal facilities or to power a fleet of
vehicles.




Project
UK:  In co-operation with UK Coal and Mining Ltd., in England, we will
be using our proprietary AirpumpTM to
recover coal ash from a coal mining slurry pond for which we will receive a fee
per ton of slurry removed.




4




To
accomplish these projects GCE is supported by engineering, procurement,
construction and research partners. These business relationships form the core
of our ability to design, develop and supply technology for a wide-range of
applications.




BUSINESS
SUMMARY




We are
focusing on projects for industrial and municipal facilities that have low-cost
fuel supplies and on-site gas, electricity and/or process heat needs. These
facilities typically prefer to purchase their energy (and where necessary, waste
disposal services) from third parties.  Our primary product offering,
therefore, is anticipated to be a one-stop, full-service, third-party source for
generating on-site Syngas, heat, electric power, and/or ethanol or other liquid
fuels from locally available waste or low-cost fuel sources.




We intend
to be a leading supplier of mid-size, on-site gasification facilities by
providing the best suited technology at a competitive price. We will target
creditworthy public and private sector clients across a broad range of
industries and geographic regions in order to diversify and reduce market risks.
If we are successful in penetrating the UK, Canadian and U.S. markets,
we intend to expand to other international markets targeting clients with
similar profiles.




PROJECT USA -
BIOFUEL




GCE has been looking at opportunities in renewable energy
production from biofuel.  One of these opportunities is to acquire a
ready made algae production site in southwest Texas.  Over the past 20
years algae production technology has improved dramatically with current
estimated yields of 2,000-5,000 gallons per acre compared to 50-60 gallons per
acre yield from growing soybeans, which currently supplies the bulk of biodiesel
in the United States.   Algae produce 30 to 100 times more oil
than Soya/Canola per acre and this oil can be easily and quickly processed into
bio-diesel. Once pressed, the residual material has many uses in pharmaceutical
production and can also be processed into animal feed.  Also,
there is also a growing awareness and concern about the economic sustainability
of diverting farming land and food crops into a source of
fuel.  Algae, unlike corn or soybeans, does not require arable land
and grows better in poor soil and brackish water. Feeding on sunlight and carbon
dioxide, growing algae is also an effective means of reducing greenhouse gas
emissions.




GCE is
currently negotiating to acquire a more than 1500 acre site which contains over
100 football field-sized ponds ideal for algae growth.  The site
includes offices and facilities including power, pumps and
irrigation.  The project is expected to be acquired
partially using government guaranteed loans.




The site
also provides ideal and sufficient space to grow Jatropha
plants.  Jatropha, a plant which has no use as a food source, produces
nuts with high oil content and is indigenous to the area.  Its oil can
be pressed and processed along with the algae oil into biodiesel.




Biodiesel
from algae and Jatropha is renewable and unlimited, while profitability in the
short term will vary with oil market prices and supply. Biodiesel
has a ready market, especially for land, sea and air transportation. GCE’s
future plans include applying for grants such as the ones being offered by the
United States Defense Advance Research Project Agency for the development of
Bio-JP8 aviation fuel.




PROJECT CANADA –
GASIFICATION





Since
2002, GCE has been investigating opportunities to reform coal into
Syngas.  Current industrial incineration of coal produces energy by
burning coal with oxygen, resulting in emissions that are harmful to the
environment.  A viable solution for clean coal lies in gasification, a
process which can be accomplished by heating the organic material at high
temperature (>700°C) and controlling the amount of oxygen it combines,
producing Syngas, while minimizing emissions. At very high temperatures
toxic, medical and even nuclear waste can be processed in a safe and clean
manner. Additionally, Syngas can be used as an energy source of heat or
electricity, converted to hydrogen gas or liquid fuels such as ethanol and
methanol, making it a highly versatile source of energy.




5




We are in
negotiations to acquire our own proprietary gasification
technology.  A patent application is on file for the gasifier, and a
prototype is being assembled for feasibility testing to be conducted at
Concordia University, in Montreal, and funded jointly by us and a Natural
Sciences and Engineering Research Council of Canada CRD
grant.   Simultaneously, we will also be assembling  a
5 to 10 ten ton per day pilot plant for the gasification of industrial and
municipal waste.  We are seeking funding for this project
with  the Canadian Federal Municipality Green Fund
initiative.  This facility will operate as a showcase for other
municipalities in terms of waste management and clean energy, as well as
providing a permitted facility for feedstock testing and analysis for all types
of waste products.





This
pilot plant would then serve as a stepping stone to building a full-scale
commercial plant.





A
functional gasification plant has enormous commercial potential. Beyond managing
MSW (Municipal Solid Waste), generated on average in developed countries of 1
ton per person per year, the same gasifier commissioned for the UK to be used as
a first-phase coal reforming plant at Killingley for UK Coal. This gasifier will
have potential use in any energy reformation application involving carbon-rich
feedstock such as poor-quality coal, agricultural wastes, or industrial
byproducts.




PROJECT UK -
DREDGING





Existing
slurry lagoons in the mining, fossil fuel and pulp and paper industries pose a
serious threat to the world-wide environment.  These slurry lagoons
can cause disaster to their surrounding environment.  To address this
problem, we have developed and are seeking to patent a proprietary
Cyclonic Pump, named AirpumpTM, which
is capable of propelling slurry and sludge at rates of up to 300 gallons/minute
in a simple, safe and effective manner.





We will
be using the AirpumpTM at a UK
Coal plant in South Yorkshire in the United Kingdom.  We will be
emptying a colliery slurry lagoon which is over 200 feet deep and is estimated
to contain 3.7 million tons of coal slurry. Once emptied, this site is slated
for redevelopment into a residential, business and commercial park.





Our
AirpumpTM is
submersible and increases in power the deeper it descends. Being sucked downward
into quicksand-like conditions will only improve its performance.  The
AirpumpTM
operates on the physical principles of the Cyclonic dredging effect. A
tornado-like effect is created inside the pump, sucking in materials at the base
and propelling the material with great force upwards.  Using
compressed air, as the dredging medium, the pump operates with increasing
effectiveness the deeper it is immersed below water.





The
advantages of the AirpumpTM are
multiple. The simplicity of its design means that it requires no special
training to operate.  Running on compressed air, water, or
inert-gases, there are no electrical components allowing the pump to operate
safely in hazardous environments, such as underwater or in
mineshafts.





As
compared to standard dredging devices which contain screws or impellers, there
are no impediments to the flow of material through the pump, nor are there any
components which can wear out, stuck or be damaged by abrasive materials (rocks,
sand, tar etc). The pump can be directed and pin-point way, causing minimal
impact to the surroundings where it is operated.





For the
past 5 years, GCE has been engaged with UK Coal in Britain, to convert coal into
syngas. The  agreement between GCE and UK Coal calls for the building
of 2 Syngas processing plants adjacent to the Killingly coal colliery on 30
acres of permitted land that UK Coal will provide.  The first plant
planned will process 125 tons of coal a day supplying syngas/electricity to
UK Coal for internal power consumption.  The second plant planned, at
1,000 tpd, will supply Syngas to the local power station, which is currently
coal powered.  Both plants are planned to take unprocessed
mine head coal, and will also process waste plastic and rubber as
feedstock.




In
addition to the slurry recovery, UK Coal is an attractive strategic partner, as
these millions of tons of untapped coal slurry in lagoons at old deep mine sites
near Doncaster in North East England can provide an excellent feedstock source
for our gasification technologies. The slurry can be reformed into Syngas and
from there converted into electricity.




6




Furthermore,
UK Coal has assigned 30 acres of land adjacent to its Kellingley Colliery for us
to site and develop a gasification plant. Additionally,
UK Coal holds all relevant and necessary permits for GCE to build and operate
its gasification technology on this site, which could possibly advance by months
the time and costs that would otherwise be required in planning and meeting
regulatory requirements. GCE is also being supported by NISP (National
Industrial Symbiotic Programme), a UK Government department under the Department
of Trade and Industry, to accelerate this project.




GCE’s
site at Kellingley is planned to process 125 tons per day of coal and other
feedstock. These other feedstock alternatives will include plastics (including
car plastics), tires, sewage cake, paper, cardboard, municipal waste, disposal
diapers and biomass (e.g., corn stalks, willow and paper mill
pulp).




THE
ALTERNATIVE ENERGY INDUSTRY




GCE is
positioned to take advantage of the tremendous opportunities in the mushrooming
alternative energy industry due to its technology, project development approach
and financial engineering expertise. We seek to be a low-cost supplier in our
selected market niches.




The
combination of fears about declining conventional oil and gas reserves,
increasing demand from developing countries like India and China, and dependence
on unstable suppliers in the Middle East, Russia and elsewhere, has generated
tremendous interest in developing alternative energy sources. As oil and gas
prices reached an all-time high this past year, most experts agreed that the
increasing costs of tapping non-conventional oil sources and growing world-wide
demand for oil will create powerful long-term opportunities for alternative
energy. As global reserves diminish, ethanol, methanol, biodiesel and other
synthetic fuels are now regarded as realistic alternatives to oil.




We
believe that alternative energy will experience very rapid increases in demand,
as energy markets experience substantial growth in demand, because there is
little near-term ability to increase conventional oil production.  Low
cost (and well funded) alternative energy supplies are most likely to survive
market fluctuations. Thus, in the face of potentially wide swings in market
conditions, we believe that we can be positioned to be successful due to our
anticipated low cost of production and ability to negotiate long-term feedstock
supply and off-take agreements (preferably at fixed prices) from companies and
governmental authorities seeking ways to dispose of their waste
products.




COMPLEMENTARY
NEXT-GENERATION TECHNOLOGIES




We
anticipate that alternative energy technologies will evolve rapidly
and that other technologies that are likely to emerge may provide for various
applications. These technologies will allow GCE to develop projects over a wider
size range and broader scope of potential feedstock. GCE
currently engages a number of industry consultants to help it broaden its search
for complementary technologies.




THE
CURRENT MARKET




We
see  becoming a significant niche player in the massive world-wide
energy market by developing and operating “private power” R.E.S.C.U.E projects
primarily for industrial and public sector entities that have waste disposal and
on-site or near-by energy requirements.  There is a tremendous
opportunity for providing Build-Own-Operate, or BOO plants that have access to
waste or low-cost feedstock and provide the bulk of the output to the local
hosts, thereby avoiding direct competition with large utility-scale generators
and suppliers.




Worldwide
primary demand is forecast to increase most rapidly for natural gas, followed by
oil, and then coal. Hydro, although a relatively small contributor, is projected
to grow at 1.8% per year between 2002 and 2030, while biomass and other waste
are projected to grow at 1.3% annually. Industrial use is projected to grow more
slowly than transport or residential use, primarily because of growing
efficiency in the industrial sector.




7




World
Primary Energy Demand (Million tons oil equivalent)




Average2002
                        
                        
                        2010
                        
                        
                        2020
                        
                        
                        Annual
      %Coal
                        
                        
                        2,389
                        
                        
                        
                        2,763
                        
                        
                        
                        3,139
                        
                        
                        
                        1.5
                        %Oil
                        
                        
                        3,676
                        
                        
                        
                        4,308
                        
                        
                        
                        5,074
                        
                        
                        
                        1.6
                        %Gas
                        
                        
                        2,190
                        
                        
                        
                        2,703
                        
                        
                        
                        3,451
                        
                        
                        
                        2.3
                        %Nuclear
                        
                        
                        692
                        
                        
                        
                        778
                        
                        
                        
                        776
                        
                        
                        
                        0.4
                        %Hydro
                        
                        
                        224
                        
                        
                        
                        276
                        
                        
                        
                        321
                        
                        
                        
                        1.8
                        %Biomass
      and Waste
                        
                        
                        1,119
                        
                        
                        
                        1,264
                        
                        
                        
                        1,428
                        
                        
                        
                        1.3
                        %Other
      Renewables
                        
                        
                        55
                        
                        
                        
                        101
                        
                        
                        
                        162
                        
                        
                        
                        5.7
                        %Total
                        
                        
                        10,345
                        
                        
                        
                        12,194
                        
                        
                        
                        14,404
                        
                        
                        
                        1.7
                        %


Source:
International Energy Agency, Global Energy Trends, 2004




In order
to comply with new environmental requirements, gasification is projected to
account for a significant portion of the increase in demand for coal over the
next few years, especially in large IGCC (Integrated Gasification Combined
Cycle) applications. At the same time, while relatively small, much of the
increase in biomass and waste utilization will be through gasification and
biodiesel production. As a result, we foresee substantial opportunities for
smaller niche players to target specialty markets without having to compete
directly with large oil and utility companies.




Another
important trend is the growing role of public policies in setting energy and
waste disposal prices. For example, in some of our target markets, energy use
taxes have pushed retail prices of gasoline as high as six dollars or more,
versus half that in the United States. Similarly, limitations on land disposal
options and higher tipping fees and taxes have made some waste disposal costs as
much as twice as expensive as they are in the United States. In addition, carbon
taxes and tradable emissions permits for CO2 and other
greenhouse gases are increasingly changing the relative costs of different
fuels. These trends are likely to continue as various countries allocate give
different priorities in dealing with environmental problems and global warming.
We anticipate the developed countries as being most likely to take the lead in
the near-term, with developing countries following suit.




Marketing
and Sales




The
market segment being targeted by us is mid-scale applications, especially
industrial and municipal facilities that generate or process waste materials and
need on-site energy for their own use. In addition, where appropriate low-cost
or no-cost waste feedstock is available, we plan to develop
stand-alone “merchant” energy facilities.  With our planned suite of
technologies, we believe that the costs of providing energy from low-cost
feedstock are quite low. Given its low production costs, we expect to
economically act as a producer of energy at most locations where low-cost
feedstock supplies are available.




We will
target industries such as food, paper and chemical products, all of which have
substantial demand for process heat, as well as electric power (and often liquid
fuels for their vehicle fleets). Priority will be given to those companies that
are in a position to enter into both feedstock supply and energy off-take
agreements either on a fixed-price or toll-processing basis. In this way, we
will insulate itself from feedstock and energy market price fluctuations for its
first plants.




Due to
the fact that we will be depending primarily on the security of the
long-term feedstock supply and energy off-take agreements, we will attempt to
give priority to companies with strong balance sheets and good out-year
prospects.




Competition




Only a
handful of companies (e.g., Intrinergy, Blue Fire Ethanol, Range Fuels, Placso)
are focused on the “inside-the-fence” market segment and most of these are
emphasizing the United States market because of its size.  Of these
companies, GCE is not aware of any that have the combination of worldwide
licensing rights to specific technologies, together with a focus on all
promising markets around the globe. This combination of preferred access to some
of the most promising gasification technology, together with the ability to
source other technologies more suited for particular applications, represents a
significant barrier to market entry for most potential competitors.




8




Research
and Development




We expect
to focus our research and development on designing, developing and testing the
technologies that we offer or will offer to our customers. A primary goal will
be to bring new products and new versions of existing products to market quickly
in order to keep pace with customer demands and remain competitive in the
marketplace. During
the fiscal year ended December 31, 2007, we incurred no research and development
expenses.During the fiscal year ended December 31, 2008, over
$700,000 was allocated towards research and development expenses, with research
conducted on site at the UK Coal slurry lagoons, pulp and paper waste lagoons in
Canada, as well as testing in the Gulf of Mexico.




Research
facilities are being set up at and in conjunction with Concordia University in
Montreal, Canada. On-site research at our planned municipal gasification
facility will also be a cooperative effort with Concordia University and with
additional funds expected (grants have been approved but net yet formalized)
from Canadian Federal and Municipal Green Fund grants.  At this
facility, a new water-based version of the AirpumpTM is
currently being developed.




We are
looking to expand into other areas of research with Concordia University,
including cyclonic separation of materials (e.g. coal from slurry) and coal to
liquid reforming.




In
addition to targeting clients who need on-site energy, GCE is
systematically investigating the opportunities, such as its planned Texas
project, to provide liquid fuels using gas-to-liquids technology, as well
as Fischer-Tropsch and similar processes provided by other suppliers. The
ethanol market appears especially promising since, with appropriate low- or
negative-cost feedstock, GCE believes it can produce ethanol at prices of $0.39
to $0.48 per gallon, which is substantially below the production cost of
approximately $1.25 per gallon for the most efficient corn ethanol plants in the
United States.




The
potential market for ethanol in the United States is huge because of the EPA
mandate to phase out Methyl Tertiary-butyl ether (MTBE) in favor of ethanol as a
clean burning oxygenate in gasoline. Ethanol production in the United States
grew from 175 million gallons in 1980 to a projected 5 billion gallons by the
end of 2006. Consumption of ethanol is projected to continue increasing at
similar rates for at least the next decade, with almost all produced from corn.
As the corn ethanol industry continues to grow, it is expected to put
significant upward pressure on corn prices as the competition between food and
fuel uses grows.




Similar opportunities
in Britain and Europe appear extremely promising. The European Union Legislation
has stipulated that 5% of all road fuel be ethanol-based by 2010, thus resulting
in a prospective shortage of ethanol. Using the PSR technology, the ethanol
produced is of a higher quality than the ethanol produced by the established
fermentation technology because it is anhydrous (i.e., it has an extra hydrogen
molecule). This means that it will blend fully when mixed with petroleum or
diesel and does not absorb water. By mixing 5% ethanol with petroleum or diesel,
it reduces emissions from vehicles by 60%, hence the EU Directive.




The
future planned applications for the AirpumpTM will
include above surface pumping of liquids and slurries, allowing us to offer both
land and water-based dredging and pumping technologies.




While it
is not in our current plans to explore wind and solar energy technologies, the
proposed site in Texas would provide an ideal site for those purposes. We
believe that there are benefits to combining the various energy technologies.
For instance CO2 emissions from one technology are a means to enhance the oil
content of algae. This site could easily accommodate various technologies and
become a Technology Park showcase.




9




Patents




GCE owns
a proprietary static fluid mixing pump device, the AirpumpTM, which
allows for the recovery of submerged bio-waste, which is subject to an
application for Letters Patent of the United States, filed on June 30th, 2008 as
a U.S. Patent Application.




Government
Incentives and Policies




The new
Obama administration has made as a cornerstone of the Federal Governments’
efforts to expand and support research into renewable energy.  The
present laws such as the governments’ loan guarantee program have been put on a
“fast track” for utilization.  In the US proposals, included is $75
billion over 10 years to establish a permanent tax credit for research and
experimentation for all forms of renewable energy.  Additionally, the
US budget includes $20 billion in tax incentives for clean energy and $39
billion for biomass fuel development.  We intend to seek funding
through grants and loan guarantees that are presently available.




The Clean
Air Act Amendments of 1990, or the CAAA, established several programs in order
to improve air quality by, among other things, imposing restrictions on the
emissions of hazardous pollutants into the atmosphere. As a means to address
common sources of air pollution such as automobiles, trucks and electric power
plants, the CAAA encourages the development and sale of alternative fuels as the
nation attempts to meet national air quality standards. Sales of alternative
fuels have been favorably affected by the CAAA, particularly the Federal Oxygen
Program, which became effective November 1, 1992. The Federal Oxygen
Program requires the sale of oxygenated motor fuels during the winter months in
certain major metropolitan areas to reduce carbon monoxide pollution. Sales of
alternative fuels also have increased due to a second CAAA program, the
Reformulated Gasoline Program. This program became effective January 1,
1995, and requires the sale of reformulated gasoline in nine major urban areas
to reduce pollutants, including those that contribute to ground level ozone,
better known as smog.




In
addition, increasingly stricter Environmental Protection Agency (“EPA”)
regulations are expected to increase the number of metropolitan areas deemed in
non-compliance with Clean Air Standards. Beginning in June 2006, the EPA
started to phase-in a program to reduce the permissible sulfur content in
highway diesel fuel from 500 parts per million to 15 parts per million, which
could increase the demand for ethanol.




On
October 22, 2004, former President Bush signed H.R. 4520, which contained
the Volumetric Ethanol Excise Tax Credit (“VEETC”) and amended the federal
ethanol excise tax structure effective as of January 1, 2005. Under VEETC, the
ethanol excise tax credit was eliminated, thereby allowing the full federal
excise tax of 18.4 cents per gallon of ethanol-blended gasoline to be collected
and allocated to the highway trust fund. The reduced federal excise tax rate of
12.35 cents per gallon rate for qualified methanol fuel and 13.25 cents per
gallon rate for qualified ethanol fuel have been extended to apply through
December 31, 2008. In place of the previous tax credit, VEETC created a new
volumetric ethanol excise tax credit of 51 cents per gallon of ethanol blended.
Refiners and gasoline blenders apply for this credit on the same tax form as
before only it is a credit against general revenue, not the highway trust fund.
Based on volume, the VEETC is expected to allow much greater refinery
flexibility in blending ethanol.




On
August 8, 2005, former President Bush signed the Energy Policy Act of 2005
(“H.R. 6”) into law. The comprehensive energy legislation includes a nationwide
renewable fuels standard (“RFS”) that is expected to double the use of ethanol
and biodiesel by 2012.




Under the
RFS, a small percentage of the U.S. fuel supply will be provided by renewable,
domestic fuels. The increased use of renewable fuels will expand U.S. fuel
supplies while easing an overburdened refining industry. The Energy Policy Act
of 2005 established RFS provisions that mandate use of renewable fuels starting
at 4 billion gallons in 2006 with increases to 7.5 billion gallons by
2012. The Act also provides that, beginning in 2013, a minimum of
250 million gallons a year of cellulosic derived ethanol be included in the
RFS. Flexibility in meeting the RFS is provided for refiners through a credit
trading program that allows refiners to use renewable fuels where and when it is
most efficient and cost-effective for them to do so. The credit trading program
will result in lower costs to refiners and thus, consumers. RFS credits have a
lifespan of 12 months. The credit trading program allows for every gallon
of cellulose-derived ethanol to be equal to 2.5 gallons of renewable fuel. The
reformulated gasoline (RFG) 2.0 wt percentage oxygenate standard under the
Clean Air Act is eliminated 270 days after enactment. (Requirement was
lifted by U.S. EPA May 8, 2006).




10




The use
of ethanol as an oxygenate to blend with fuel to comply with federal mandates
also has been aided by federal tax policy. The Energy Tax Act of 1978 exempted
ethanol blended gasoline from the federal gas tax as a means of stimulating the
development of a domestic ethanol industry and mitigating the country’s
dependence on foreign oil. As amended, the federal tax exemption currently
allows the market price of ethanol to compete with the price of providing a per
gallon “equalization” payment that allows blenders to pay more for ethanol than
the wholesale price of gasoline and still retain profit margins equal to those
received upon the sale of gasoline that is not blended with ethanol. Under
current law, the federal gasoline tax exemption for a 10% ethanol blend is 5.1
cents per gallon through 2010.




Government
Regulations, Environment and Permits




Our
technologies are subject to compliance with United States federal, state and
local environmental, health and safety laws and regulations.  They are
also subject to regulations in the UK, Canada and the other countries in which
we operate.  These regulations govern operations and use, storage,
handling, discharge and disposal of a variety of substances.




Employees




The
Company at present has 5 full time employees, 12 consultants on a project basis
and a network of 40 subcontractors.




Exchange
Act Registration




We
voluntarily filed a registration statement on Form 10SB in April 2000 with
the Securities and Exchange Commission (“SEC” or “Commission”) in order to
register our common stock under Section 12(g) of the Securities Exchange Act of
1934, as amended (“Exchange Act”). We are required to file quarterly, annual and
other reports and other information with the SEC as required by the Exchange
Act. The SEC maintains a website that contains annual, quarterly and current
reports, proxy and information statements and other information filed with the
SEC. The SEC’s website address is http://www.sec.gov.
You may also read and copy any document we file with the SEC at the SEC’s public
reference room, 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the
SEC at 1-800-SEC-0330 for further information on the operation of its public
reference room.




Corporate
History




GCE is a
Maryland corporation formed on November 8, 2007.  GCE is successor to
Newsearch, Inc. (“Newsearch”), a Colorado corporation, which was incorporated on
December 3, 1999.  Newsearch was dormant until August 20, 2002,
when it acquired Panache, Inc. (“Panache”), a Colorado corporation, and Panache
became a wholly-owned subsidiary of Newsearch.  Panache sold women’s
apparel under its trade name, “The Ollie Collection,” on a wholesale basis ,
represented several manufacturers of women’s apparel and accessories and also
bought and resold women’s apparel and accessories for its own account, for
resale. Panache ceased operations in June 2004, when it determined that its
business plan could not be executed due to a lack of operating capital and
prospects for raising adequate funding, and was later dissolved in
January 2005. Newsearch was dormant from July 2004 through
July 2006 when it began operating in furtherance of its current business
plan. On November 13, 2007, Newsearch’s state of incorporation was changed
from Colorado to Maryland when it was merged with GCE.




Internet
Web Site




Our
website is located at http://www.globalcleanenergy.net.




11





ITEM
1A. RISK FACTORS




You
should carefully consider the risks described below. If any of the following
risks actually occur, our business could be harmed. You should also refer to the
other information about us contained in this Form 10-K, including our financial
statements and related notes.




We
have limited operating experience and a history of operating losses, and we may
be subject to risks inherent in early stage companies, which may make it
difficult for you to evaluate our business.




We have a
limited operating history upon which you can evaluate our business and
prospects. We cannot provide any assurance that we will profitable in any given
period or at all. You must consider our business, financial history and
prospects in light of the risks and difficulties we face as an early stage
company with a limited operating history. In particular, our management may have
less experience in implementing our business plan and strategy compared to our
competitors, including our strategy to establish our operations and build our
brand name. In addition, we may face challenges in planning and forecasting
accurately as a result of our limited historical data and inexperience in
implementing and evaluating our business strategies. Our inability to
successfully address these risks, difficulties and challenges as a result of our
inexperience and limited operating history may have a negative impact on our
ability to implement our strategic initiatives, which may have a material
adverse effect on our business, prospects, financial condition and results of
operations.




We
may not be able to raise sufficient capital to grow our business.




We have
in the past needed to raise funds to operate our business, and we likely will
need to raise additional funds to construct our BOO plants in commercial
quantities. If we are unable to raise additional funds when needed, our ability
to operate and grow our business could be impaired. We do not know whether we
will be able to secure additional funding or funding on terms favorable to us.
Our ability to obtain additional funding will be subject to a number of factors,
including market conditions, our operating performance and investor sentiment.
These factors may make the timing, amount, terms and conditions of additional
funding unattractive.




Raising
additional financing may be detrimental to existing shareholders.




Currently,
we do not have any financing arrangements in place.  We need to raise
additional funds through the issuance of equity and/or debt through private
placements or public offerings to provide financing to meet the needs of our
long-term strategic plan.  If we raise additional financing through
the issuance of equity, equity-related or debt securities, those securities may
have rights, preferences or privileges senior to those of the rights of our
common stock and our stockholders may experience dilution of their ownership
interests.  Similarly, the incurrence of additional debt could
increase our interest expense and other debt service obligations and could
result in the imposition of covenants that restrict our operational and
financial flexibility. If financing is not available or obtainable within the
next three months, our ability to meet our financial obligations and pursue our
plan of operation will be substantially limited or we may be forced to cease
operations completely.




We
may not be able to acquire the rights to the gasification / Pyrolitic Steam
Reforming technology.




In order
to execute our business plan, we must acquire the rights to the gasification /
Pyrolitic Steam Reforming technology.  We do not own this technology
and are currently in negotiations to acquire the rights.  In the
event, we are unsuccessful in acquiring the rights to the gasification /
Pyrolitic Steam Reforming technology, we may have to search for alternative
technologies or sources.  If we are not successful in acquiring the
rights to the gasification / Pyrolitic Steam Reforming technology, or are
significantly delayed in doing so, our business, financial condition and results
of operations could be adversely affected.




12




The
gasification / Pyrolitic Steam Reforming technology, which we are negotiating to
acquire, is still in the testing phase and unproven on a large-scale commercial
basis and could fail to perform in a commercial production
environment.




The
gasification / Pyrolitic Steam Reforming technology, we are negotiating to
acquire, is still in the testing phase.  All of the tests which have
been conducted to date with respect to the gasification / Pyrolitic Steam
Reforming, have been performed in limited quantities.  There can be no
assurance that the same or similar results could be obtained at competitive
costs on a large-scale commercial basis. The gasification / Pyrolitic Steam
Reforming technology has never been used under the conditions or in the volumes
that will be required to be profitable and future difficulties may arise. It is
possible that the technologies, when used, may require further research,
development, design and testing prior to implementation of a larger-scale
commercial application. Accordingly, there can be no assurance that these
technologies will perform successfully on a large-scale commercial basis or that
they will be profitable to us.




Gasification
/ Pyrolitic Steam Reforming technology may not gain broad commercial
acceptance.




Commercial
applications of gasification / PSR technology are at an early stage of
development, and the extent to which gasification / PSR power generation will be
commercially viable is uncertain. Many factors may affect the commercial
acceptance of gasification / PSR technology, including the
following:




·
            performance,
      reliability and cost-effectiveness of gasification / PSR technology
      compared to conventional and other alternative energy sources and
      products;




·
            developments
      relating to other alternative energy generation
    technologies;




·
            fluctuations
      in economic and market conditions that affect the cost or viability of
      conventional and alternative energy sources, such as increases or
      decreases in the prices of oil and other fossil
  fuels;




·
            overall
      growth in the alternative energy equipment
  market;




·
            availability
      and terms of government subsidies and incentives to support the
      development of alternative energy sources, including gasification /
      PSR;




·
            fluctuations
      in capital expenditures by utilities and independent power producers,
      which tend to decrease when the economy slows and interest rates increase;
      and




·
            the
      development of new and profitable applications requiring the type of
      energy supply provided by our autonomous gasification / PSR
      systems.




If
gasification / PSR technology does not gain broad commercial acceptance, our
business will be materially harmed and we may need to curtail or cease
operations.




If
sufficient demand for our Build-Own-Operate  on-site alternative
energy plants does not develop or takes longer to develop than we anticipate,
our revenues may decline, and we may be unable to achieve and then sustain
profitability.




Even if
gasification technology achieves broad commercial acceptance, our BOO plants may
not prove to be a commercially viable technology for generating electricity from
low-cost sources of feedstock. We expect to invest a significant portion of our
time and financial resources in the development of our BOO plants. As we begin
to market, sell and construct our BOO plants, unforeseen hurdles may be
encountered that would limit the commercial viability of our BOO plants,
including unanticipated construction, operating, maintenance and other costs.
Our target customers and we may also encounter technical obstacles to
construction, constructing and maintaining BOO plants with sufficient capacity
to generate competitively-priced electricity.




If demand
for our BOO plants fails to develop sufficiently, we may be unable to grow our
business or generate sufficient revenues to achieve and then sustain
profitability. In addition, demand for BOO plants in our presently targeted
markets, including North America and the United Kingdom, may not develop or may
develop to a lesser extent than we anticipate. If we are not successful in
commercializing our BOO plants, or are significantly delayed in doing so, our
business, financial condition and results of operations could be adversely
affected.




13




Changes
in governmental policy could adversely affect our business, financial condition
and results of operations.




Although
current federal government policy provides incentives to promote the development
of alternative energy sources, there can be no assurance that such incentives
will continue in the future or that any government programs to provide financial
assistance to such programs will be directed to bio-fuels projects in general or
GCE’s projects in particular. In addition, changes in the policies of the United
States and various foreign countries, including changes in duties and tariffs,
could have an impact on the operations and financial condition of
GCE.




Our
targeted markets are highly competitive. We expect to compete with other
alternative energy companies and may have to compete with larger companies that
enter into the alternative energy business.




The
renewable energy industry, particularly in our targeted markets of North America
and the United Kingdom, is highly competitive and continually evolving as
participants strive to distinguish themselves and compete with the larger
electric power industry. Competition in the renewable energy industry is likely
to continue to increase with the advent of dozens of new alternative energy
technologies. If we are not successful in constructing systems that generate
competitively priced electricity, we will not be able to respond effectively to
competitive pressures from other alternative energy technologies.




Moreover,
the success of alternative energy generation technologies may cause larger
electric utility and other energy companies with substantial financial resources
to enter into the alternative energy industry. These companies, due to their
greater capital resources and substantial technical expertise, may be better
positioned to develop new technologies. Our inability to respond effectively to
such competition could adversely affect our business, financial condition and
results of operations.




We
anticipate investing funds to construct demonstration BOO plants that generate
little or no direct revenue.




We plan
to construct in the future a demonstration and pilot BOO plant to establish the
feasibility of our gasification technology and to encourage the market adoption
of our BOO plants. A pilot BOO plant permits potential customers to see
first-hand the viability of gasification technology as a source of electricity.
Although we incur significant costs in constructing and maintaining a pilot BOO
plant, this BOO plant will generate little or no direct revenue to
us.




We
may be unable to manage the expansion of our operations
effectively.




We intend
to expand our business significantly. However, to date the scope of our
operations has been limited, and we do not have experience operating on the
scale that we believe will be necessary to achieve profitable operations. Our
current personnel, facilities, systems and internal procedures and controls are
not adequate to support our anticipated future growth. We plan to add sales,
marketing and engineering offices in additional locations, including continental
Europe and throughout North America.




To manage
the expansion of our operations, we will be required to improve our operational
and financial systems, procedures and controls, increase our construction
operating capacity and expand, train and manage our employee base, which must
increase significantly if we are to fulfill our current construction, operation
and growth plans. Our management will also be required to maintain and expand
our relationships with any customers, suppliers and other third parties, as well
as attract new customers and suppliers. If we do not meet these challenges, we
may be unable to take advantage of market opportunities, execute our business
strategies or respond to competitive pressures.




We
may be unable to successfully negotiate and enter into operations and
maintenance contracts with potential customers.




An
important element of our business strategy is to maximize our revenue
opportunities with any potential future customers by seeking to enter into
operations and maintenance contracts with them under which we would be paid fees
for operating and maintaining the BOO plants that they have purchased from us.
Even if customers purchase our BOO plants, they may not enter into operations
and maintenance contracts with us. Even if we successfully negotiate and enter
into such operations and maintenance contracts, our customers may terminate them
prematurely or they may not be profitable for a variety of reasons, including
the presence of unforeseen hurdles or costs. In addition, our inability to
perform adequately under such operations and maintenance contracts could impair
our efforts to successfully market the BOO plants. Any one of these outcomes
could have a material adverse effect on our business, financial condition and
results of operations.




14




Problems
with the quality or performance of our BOO plants could adversely affect our
business, financial condition and results of operations.




We
anticipate that our agreements with customers will generally include guarantees
with respect to the quality and performance of our BOO plants. Because of the
limited operating history of our BOO plants, we will be required to make
assumptions regarding the durability, reliability and performance of the
systems, and we cannot predict whether and to what extent we may be required to
perform under the guarantees that we expect to give our customers. Our
assumptions could prove to be materially different from the actual performance
of our BOO plants, causing us to incur substantial expense to repair or replace
defective systems in the future. We will bear the risk of claims long after we
have sold our BOO plants and recognized revenue. Moreover, any widespread
gasification or technology failures could adversely affect our business,
financial condition and results of operations.




We
plan to market and sell our products in international markets. If we are unable
to manage our international operations effectively, our business, financial
condition and results of operations could be adversely affected.




We plan
to market and sell our products in foreign countries, including the United
Kingdom and other countries in the European Union, and we are therefore subject
to risks associated with having international operations. Risks inherent in
international operations include, but are not limited to, the
following:




·
            changes
      in general economic and political conditions in the countries in which we
      operate;




·
            unexpected
      adverse changes in foreign laws or regulatory requirements, including
      those with respect to renewable energy, environmental protection,
      permitting, export duties and
quotas;




·
            trade
      barriers such as export requirements, tariffs, taxes and other
      restrictions and expenses, which could increase the prices of our BOO
      plants and make us less competitive in some
  countries;




·
            fluctuations
      in exchange rates may affect demand for our BOO plants and may adversely
      affect our profitability in US dollars to the extent the price of our BOO
      plants and cost of raw materials and labor are denominated in a foreign
      currency;




·
            difficulty
      with staffing and managing widespread
  operations;




·
            difficulty
      of, and costs relating to compliance with, the different commercial and
      legal requirements of the overseas markets in which we offer and sell our
      BOO plants;




·
            inability
      to obtain, maintain or enforce intellectual property rights;
      and




·
            difficulty
      in enforcing agreements in foreign legal
  systems.




Our
business in foreign markets will require us to respond to rapid changes in
market conditions in these countries. Our overall success as a global business
depends, in part, on our ability to succeed in differing legal, regulatory,
economic, social and political conditions. We may not be able to develop and
implement policies and strategies that will be effective in each location where
we do business, which in turn could adversely affect our business, financial
condition and results of operations.




15




Currency
translation and transaction risk may adversely affect our business, financial
condition and results of operations.




Although
our reporting currency is the US dollar, we expect to conduct our business and
incur costs in the local currency of most countries in which we operate. As a
result, we will be subject to currency translation risk. We expect a large
percentage of our revenues to be generated outside the United States and
denominated in foreign currencies in the future. Changes in exchange rates
between foreign currencies and the US dollar could affect our revenues and cost
of revenues, and could result in exchange losses. We cannot accurately predict
the impact of future exchange rate fluctuations on our results of operations.




Our
business uses non-exclusive licensed technology, which may be difficult to
protect and may infringe on the intellectual property rights of third
parties.




It is
possible that we may need to acquire other licenses to, or to contest the
validity of, issued or pending patents or claims of third parties. We cannot
assure you that any license would be made available to us on acceptable terms,
if at all, or that we would prevail in any such contest. In addition, we could
incur substantial costs in defending ourselves in suits brought against us for
alleged infringement of another party’s patents in bringing patent infringement
suits against other parties based on our licensed patents.




In
addition to licensed patent protection, we also rely on trade secrets,
proprietary know-how and technology that we will seek to protect, in part, by
confidentiality agreements with our prospective joint venture partners,
employees and consultants. We cannot assure you that these agreements will not
be breached, that we will have adequate remedies for any breach, or that our
trade secrets and proprietary know-how will not otherwise become known or be
independently discovered by others.




Our
financial results may fluctuate from quarter to quarter, which may make it
difficult to predict our future performance.




Our
financial results may fluctuate as a result of a number of factors, many of
which are outside of our control. For these reasons, comparing our financial
results on a period-to-period basis may not be meaningful, and you should not
rely on our past results as an indication of our future performance. Our future
quarterly and annual expenses as a percentage of our revenues may be
significantly different from those we expect for the future. Our financial
results in some quarters may fall below expectations. Any of these events could
cause our stock price to fall. Each of the risk factors listed in this “Risk
Factors” section, including the following factors, may adversely affect our
business, financial condition and results of operations:




·
            delays
      in permitting or acquiring necessary regulatory
  consents;




·
            delays
      in the timing of contract awards and determinations of work
      scope;




·
            delays
      in funding for or construction of BOO
plants;




·
            changes
      in cost estimates relating to BOO plant completion, which under percentage
      of completion accounting principles could lead to significant charges to
      previously recognized revenue or to changes in the timing of our
      recognition of revenue from those
projects;




·
            delays
      in meeting specified contractual milestones or other performance criteria
      under project contracts or in completing project contracts that could
      delay the recognition of revenue that would otherwise be
      earned;




·
            reductions
      in the availability or level of subsidies and incentives for alternative
      energy sources;




·
            decisions
      made by parties with whom we have commercial relationships not to proceed
      with anticipated projects;




·
            increases
      in the length of our sales cycle;
and




·
            reductions
      in the efficiency of our construction and/or operations
      processes.




16




If prices for alternative energy or fuels drop significantly, we
will also be forced to reduce our prices, which potentially may lead to
losses.




Prices
for alternative energy or fuels can vary significantly over time and decreases
in price levels could adversely affect our profitability and viability. For
example, the price of ethanol has some relation to the price of gasoline. The
price of ethanol tends to increase as the price of gasoline increases, and the
price of ethanol tends to decrease as the price of gasoline decreases. Any
lowering of gasoline prices will likely also lead to lower prices for ethanol
and may adversely affect our operating results if we are producing ethanol. We
cannot assure you that we will be able to sell any alternative energy or fuels
we produce.




Price
increases or interruptions in needed energy supplies could cause loss of
customers and impair our profitability.




Production
of alternative fuel sources requires a constant and consistent supply of energy.
If there is any interruption in our supply of energy for whatever reason, such
as availability, delivery or mechanical problems, we may be required to halt any
production we may have.  If we halt production for any extended period
of time, it will have a material adverse effect on our business. Natural gas and
electricity prices have historically fluctuated significantly. We expect to
purchase significant amounts of these resources as part of our gasification
process.  Increases in the price of natural gas or electricity would
harm our business and financial results by increasing our energy
costs.




We
may be unable to attract and retain management and other personnel we need to
succeed.




Our
success depends on the skills, experience and efforts of our senior management
and other key development, manufacturing, construction and sales and marketing
employees. We cannot be certain that we will be able to attract, retain and
motivate such employees. The loss of the services of one or more of these
employees could have a material adverse effect on our business. There is a risk
that we will not be able to retain or replace these key employees.




In
addition, our anticipated growth will require us to hire a significant number of
qualified technical, commercial and administrative personnel. The majority of
our new hires will be engineers, project managers and operations personnel.
There is intense competition from other companies and research and academic
institutions for qualified personnel in the areas of our activities. If we
cannot continue to attract and retain, on acceptable terms, the qualified
personnel necessary for the continued development of our business, we may not be
able to sustain our operations or grow at a competitive pace.




The
reduction or elimination of government subsidies and economic incentives for
alternative energy sources could prevent demand for our BOO plants from
developing, which in turn would adversely affect our business, financial
condition and results of operations.




Federal,
state and local governmental bodies in many countries, most notably the United
Kingdom, Canada and the United States, have provided subsidies in the form of
tariff subsidies, rebates, tax credits and other incentives to utilities, power
generators and distributors using alternative energy. However, these incentives
and subsidies generally decline over time, and many incentive and subsidy
programs have specific expiration dates. Moreover, because the market for
electricity generated from gasification is at an early stage of development,
some of the programs may not include gasification as an alternative energy
source eligible for the incentives and subsidies.




Currently,
the cost of electricity generated from gasification, without the benefit of
subsidies or other economic incentives, substantially exceeds the price of
electricity in most significant markets in the world. As a result, the near-term
growth of the market for our BOO plants, which are designed to feed electricity
to an on-site end-user, depends significantly on the availability and size of
government incentives and subsidies for gasification. As alternative energy
becomes more of a competitive threat to conventional energy providers, companies
active in the conventional energy business may increase their lobbying efforts
in order to encourage governments to stop providing subsidies for alternative
energy, including gasification. We cannot predict the level of any such efforts,
or how governments may react to such efforts. The reduction, elimination or
expiration of government incentives and subsidies, or the exclusion of
gasification technology from those incentives and subsidies, may result in the
diminished competitiveness of gasification relative to conventional and
non-gasification alternative sources of energy. Such diminished competitiveness
could materially and adversely affect the growth of the gasification industry,
which could in turn adversely affect our business, financial condition and
results of operations.




17




Lax
enforcement of environmental and energy policy regulations may adversely affect
demand for alternative energy.




Our
success will depend in part on effective enforcement of existing environmental
and energy policy regulations. Many of our potential customers are unlikely to
switch from the use of conventional fuels unless compliance with applicable
regulatory requirements leads, directly or indirectly, to the use of alternative
energy sources. Both additional regulation and enforcement of such regulatory
provisions are likely to be vigorously opposed by the entities affected by such
requirements. If existing emissions-reducing standards are weakened, or if
governments are not active and effective in enforcing such standards, our
business and results of operations could be adversely affected. Even if the
current trend toward more stringent emissions standards continues, we will
depend on the ability of alternative energy sources to satisfy these emissions
standards. Certain standards imposed by regulatory programs may limit or
preclude the use of our products to comply with environmental or energy
requirements. Any decrease in the emission standards or the failure to enforce
existing emission standards and other regulations could result in a reduced
demand for any alternative energy we produce.




Costs
of compliance with burdensome or changing environmental and operational safety
regulations could cause our focus to be diverted away from our business and our
results of operations to suffer.




The
production of many alternative energy fuels still involves the emission of
various airborne pollutants, including particulate matter, carbon monoxide,
carbon dioxide, nitrous oxide, volatile organic compounds and sulfur dioxide.
The production facilities that we will build may discharge water or other
matters into the environment. As a result, we are subject to complicated
environmental regulations of the countries we are in or the U.S. Environmental
Protection Agency and regulations and permitting requirements of the states
where our plants are to be located. These regulations are subject to change and
such changes may require additional capital expenditures or increased operating
costs. Consequently, considerable resources may be required to comply with
future environmental regulations. In addition, our BOO plants could be subject
to environmental nuisance or related claims by employees, property owners or
residents near the plants arising from air or water discharges. Environmental
and public nuisance claims, or tort claims based on emissions, or increased
environmental compliance costs could significantly increase our operating
costs.




Implementation
of our planned projects is dependent upon receipt of all necessary regulatory
permits and approvals.




Development
of power generation is heavily regulated. Each of our planned projects is
subject to multiple permitting and approval requirements. In many cases we
expect to be dependent on a regional government agency for such permits and
approvals. Due to the unique nature of gasification power generation systems, we
would expect our projects to receive close scrutiny by permitting agencies,
approval authorities and the public, which could result in substantial delay in
the permitting process. Successful challenges by any parties opposed to our
planned projects could result in conditions limiting the project size or in the
denial of necessary permits and approvals.




If we are
unable to obtain necessary permits and approvals in connection with any or all
of our projects, those projects would not be implemented and our business,
financial condition and results of operations would be adversely affected.
Further, we cannot assure you that we have been or will be at all times in
complete compliance with all such permits and approvals. If we violate or fail
to comply with these permits and approvals, we could be fined or otherwise
sanctioned by regulators.




18




Our
proposed new BOO plants will also be subject to federal and state laws regarding
occupational safety.




Risks of
substantial compliance costs and liabilities are inherent in the production of
alternative energy fuels. We may be subject to costs and liabilities related to
worker safety and job related injuries, some of which may be significant.
Possible future developments, including stricter safety laws for workers and
other individuals, regulations and enforcement policies and claims for personal
or property damages resulting from operation of any BOO plants could reduce the
amount of cash that would otherwise be available to further enhance our
business.




Any
acquisitions that we make or joint venture agreements that we enter into, or any
failure to identify appropriate acquisition or joint venture candidates, could
adversely affect our business, financial condition and results of
operations.




From time
to time, we may evaluate potential strategic acquisitions of complementary
businesses, products or technologies, as well as consider joint ventures and
other collaborative projects. We may not be able to identify appropriate
acquisition candidates or strategic partners, or successfully negotiate, finance
or integrate any businesses, products or technologies that we acquire. We do not
have any experience with acquiring companies or products. Any acquisition we
pursue could diminish the proceeds from this offering available to us for other
uses or be dilutive to our stockholders, and could divert management’s time and
resources from our core operations.




Strategic
acquisitions, investments and alliances with third parties could subject us to a
number of risks, including risks associated with sharing proprietary information
and loss of control of operations that are material to our business. In
addition, strategic acquisitions, investments and alliances may be expensive to
implement. Moreover, strategic acquisitions, investments and alliances subject
us to the risk of non-performance by a counterparty, which may in turn lead to
monetary losses that materially and adversely affect our business, financial
condition and results of operations.




Our
directors and officers as a group have significant voting power and may take
actions that may not be in the best interest of all other
stockholders.




Our
directors and officers, as a group, control approximately 70% of the Company’s
current outstanding shares of common stock. These directors and executive
officers may be able to exert significant control over our management and
affairs requiring stockholder approval, including approval of significant
corporate transactions. This concentration of ownership may expedite approvals
of Company decisions, or have the effect of delaying or preventing corporate
actions that may be in the best interests of all our stockholders.




Our
common stock is traded on the OTCBB market and may fluctuate
significantly.




Our
common stock is currently traded and quoted on the OTCBB market. The quotation
of our common stock on a securities market or exchange does not assure that a
meaningful, consistent and liquid trading market will ever exist.  Our
stock is a penny stock and there are significant risks.




Stockholders
should be aware that, according to the SEC Release No. 34-29093, the market
for penny stocks has suffered in recent years from patterns of fraud and abuse.
These patterns include:




·
            Control
      of the market for the security by one or a few broker-dealers that are
      often related to the promoter or
issuer;




·
            Manipulation
      of prices through prearranged matching of purchases and sales and false
      and misleading press releases;




·
            “Boiler
      room” practices involving high pressure sales tactics and unrealistic
      price projections by inexperienced sales
  persons;




·
            Excessive
      and undisclosed bid-ask differentials and markups by selling
      broker-dealers; and




·
            The
      wholesale dumping of the same securities by promoters and broker-dealers
      after prices have been manipulated to a desired level, along with the
      inevitable collapse of those prices with consequent investor
      losses.




19




Furthermore,
the “penny stock” designation may adversely affect the development of any public
market for the Company’s shares of common stock or, if such a market develops,
its continuation. Broker-dealers are required to personally determine whether an
investment in “penny stock” is suitable for customers.




ITEM
1B. UNRESOLVED STAFF COMMENTS




None.




ITEM 2.
PROPERTIES




The
Company’s principal executive office is located at 1241 S. Parker Rd. #201,
Denver, CO 80023  where it occupies 700 square feet of
space.  The lease runs from month-to-month with monthly payments of
approximately $500 in addition to certain operating
expenses.   The Company is in the final process of moving its
executive and corporate headquarters to Houston, Texas and is negotiating lease
space to meet the Company’s needs for at least the next three
years.




ITEM 3. LEGAL
PROCEEDINGS




We
currently have no legal proceedings pending nor have any legal proceeding been
threatened against us or any of our officers, directors or control persons of
which we are aware.




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




None.


PART II




ITEM 5. MARKET FOR REGISTRANT’S
COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
SECURITIES.




Market
Information




The
Company’s common stock began trading on the OTC Bulletin Board (“OTCBB”) on
October 3, 2008 under the trading symbol “GCEI”.




The
following table shows the high and low bid prices of our common stock as quoted
on the OTCBB by quarter since October 3, 2008 and for each quarter after
December 31, 2008.  These quotes reflect inter-dealer prices, without
retail markup, markdown or commissions and may not represent actual
transactions. The information below was obtained from those organizations, for
the respective periods.




Fiscal
      Yearended
      December 31
                                    
                                    Quarter
                                    
                                    High
                                    
                                    
                                    Low2008
                                    
                                    First
      Quarter
                                    
                                    
                                    --
                                    
                                    
                                    
                                    --Second
      Quarter
                                    
                                    
                                    --
                                    
                                    
                                    
                                    --Third
      Quarter
                                    
                                    
                                    --
                                    
                                    
                                    
                                    --Fourth
      Quarter
                                    
                                    $
                                    1.50
                                    
                                    
                                    $
                                    .102009
                                    
                                    First
      Quarter
                                    
                                    $
                                    .25
                                    
                                    
                                    
                                    .05





The high
and low bid prices for shares of our common stock on March 27, 2009 was $.10 per
share, respectively, based upon bids that represent prices quoted by
broker-dealers on the OTCBB. These quotations reflect inter-dealer prices,
without retail mark-up, mark-down or commissions, and may not represent actual
transactions.




20




Holders




As of
December 31, 2008, we had 171 shareholders of record and 25,378,721 common
shares issued and outstanding.




Dividend
Policy




We have
not declared or paid any dividends on our common stock to date. We anticipate
that any future earnings will be retained as working capital and used for
business purposes. Accordingly, it is unlikely that we will declare or pay any
such dividends in the foreseeable future.




Securities
Authorized for Issuance under Equity Compensation Plans




The
following table discloses information as of December 31, 2008 with respect
to compensation plans (including individual compensation arrangements), if any,
under which our equity securities are authorized for issuance.




Plan
      category
                                        
                                        Number
      of
                                          securities
      to be
                                          issued
      upon exercise
                                          of
      outstanding
                                          options,
      warrants
                                          and
      rights (a)
                                        
                                        
                                        Weighted
      average
                                          exercise
      price of
                                          outstanding
                                          options,
      warrants
                                          and
      rights (b)
                                        
                                        
                                        Number
      of securities remaining available for future issuance under equity
      compensation plans
                                          (excluding
      securities reflected in column (a)) (c)Equity
      compensation plans approved by security holders2007
      EMPLOYEE STOCK COMPENSATION PLAN
                                        
                                        
                                        -0-
                                        
                                        
                                        
                                        N/A
                                        
                                        
                                        
                                        5,000,000Equity
      compensation plans not approved by security holdersNONE
                                        
                                        
                                        N/A
                                        
                                        
                                        
                                        N/A
                                        
                                        
                                        
                                        N/ATotal
                                        
                                        
                                        -0-
                                        
                                        
                                        
                                        N/A
                                        
                                        
                                        
                                        5,000,000




ITEM 6. SELECTED FINANCIAL DATA




We are a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 and are not required to provide the information under this
item.




21




ITEM
7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS




Overview




Plan
of Operation




GCE was
formed to develop and commercialize proprietary “R.E.S.C.U.E” technologies which
recover and reform environmental salvage into clean useable
energy.  As global reserves diminish, biodiesel and other synthetic
fuels are now regarded as realistic alternatives to oil. The combination of
fears about declining conventional oil reserves, increasing demand from
developing countries like India and China, and dependence on unstable suppliers
in the Middle East and elsewhere, has generated tremendous interest in
developing alternative energy sources.  GCE is at the forefront of
global initiatives to reduce greenhouse gas emissions and lower the dependency
in the USA and Europe on imported oil and natural gas with its proprietary and
innovative technologies for clean coal and other renewable energy
sources.




We work
with both the governmental and private sectors on projects which seek to
implement profitable renewable energy while cleaning specific environmental
problem areas. What began as a search for best of breed technologies to convert
waste and biomass into clean renewable energy, has evolved and expanded into
five areas of active business development: (i) research and development of new
technologies; (ii) international joint-ventures to develop waste-to-energy
projects; (iii) technology and services for environmental ash cleanup
operations; (iv) renewable energy production; and (v) seeking public financing
for projects in the green energy sector.




Results of
Operation




Since the
second half of fiscal 2006 the Company has been in operation to execute its
business plan.  For the year ended December 31, 2008, we had no sales
and a loss of $668,231 as compared to a net loss of $837,169 for the year ended
December 31, 2007.  General and administrative expenses for the year
ended December 31, 2008 were $99,221 compared to $71,167 for the year ended
December 31, 2007.  Professional and consulting fees were $145,320 in
2008 compared to $240,471 in 2007.  The decrease in net loss and
expenses is a result of the Company’s ability to more effectively utilize its
consultants and a focused approach to implement its business plan.




Liquidity
and Capital Resources




Our cash
on hand totaled $54,858 on December 31, 2008.  During the same period
our working capital deficit was $668,231; this deficit resulted from ongoing
expense related to implementing our business plan without any revenues to
date.  The stockholders’ deficit was $2,144,631 at December 31,
2008.




We have
yet to begin construction of BOO plants or ethanol producing plants. Since
August 2006, we have been engaged in organizational activities, including
developing a strategic operating plan, entering into a license agreement and
raising private capital. Our continued existence is dependent upon our ability
to obtain additional debt and/or equity financing at cost-effective rates.
Management anticipates beginning construction of a plant within the next 12 to
18 months and expects to complete the project within the next 36 to
42 months. Management plans to raise additional funds through project
financings or through future sales of our common stock, until such time as our
revenues are sufficient to meet its cost structure and ultimately achieve
profitable operations. There is no assurance we will be successful in raising
additional capital at cost-effective rates or achieving profitable operations.
Frequently, our board of directors will attempt to use non-cash consideration to
satisfy obligations. In many instances, we believe that the non-cash
consideration will consist of restricted shares of our common stock. These
actions will result in dilution of the ownership interests of existing
shareholders and may further dilute our common stock book value.




To date,
we have financed our operations through the combination of equity and debt
financing, loans from related parties, and the use of shares of our common stock
issued as payment for services rendered to us by third parties. In the future we
may have to issue shares of our common stock and warrants in private placement
transactions to help finance our operations, and to pay for professional
services (such as financial consulting, market development, legal services, and
public relations services). We do not intend to pay dividends to shareholders in
the foreseeable future.




22




In order
for our operations to continue, we will need to generate revenues from our
intended operations sufficient to meet our anticipated cost structure. We may
encounter difficulties in establishing these operations due to the time frame of
developing, constructing and ultimately operating the planned BOO plants and
bio-refinery projects.




To ensure
sufficient funds to meet our future needs for capital, we will from time to
time, evaluate opportunities to raise financing through some combination of the
private sale of equity, or issuance of convertible debt securities. However,
future equity or debt financing may not be available to us at all, or if
available, may not be on terms acceptable to us. We have estimated our operating
expenses for the period from January 2009 to December 2009 will
approximate roughly $1,800,000, excluding engineering costs related to the
development of our BOO plants.




If we do
not raise additional capital, or we are unable to obtain additional financing,
or begin to generate revenues from our intended operations, we may have to scale
back or postpone the preliminary engineering design and permitting for our
initial facility until such financing is available.




Critical
Accounting Policies




Financial
Reporting Release No. 60 of the SEC encourages all companies to include a
discussion of critical accounting policies or methods used in the preparation of
the financial statements. There are no current revenue generating activities
that give rise to significant assumptions or estimates. Our most critical
accounting policies relate to the accounting and disclosure of related party
transactions. Our financial statements filed as part of this annual report
include a summary of the significant accounting policies and methods used in the
preparation of our financial statements.




Off-Balance
Sheet Arrangements




We do not
have any off-balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that is material to investors.




ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




We are a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 and are not required to provide the information under this
item.




ITEM 8. FINANCIAL
STATEMENTS




Our
audited financial statements for the years ended December 31, 2008 and 2007
and the audit report thereon of Larry O’Donnell, CPA, P.C., are included in this
annual report.







ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE




None.




ITEM 9A.(T).
CONTROLS AND PROCEDURES.




(a) Management’s
Annual Report on Internal Control Over Financial Reporting. Our management is
responsible for establishing and maintaining an adequate system of internal
control over financial reporting (as defined in Exchange Act Rule 13a-15(f)).
Our internal control over financial reporting is designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally
accepted accounting principles. Specifically, our internal control over
financial reporting includes those policies and procedures
that:




23




•           Pertain
to the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of our assets;




•           Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that our receipts and expenditures are being made
only in accordance with authorizations by our management and/or directors;
and




•           Provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect
on the financial statements.




Under the
supervision and with the participation of our management, including our
principal executive officer and our principal financial officer, we conducted an
evaluation of the effectiveness of our internal control over financial reporting
based on the framework in Internal Control — Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission (the “COSO
Framework”). Based on this evaluation under the COSO Framework, management
concluded that our internal control over financial reporting was effective as of
December 31, 2008.




This
annual report does not include an attestation report by our registered public
accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by our registered public
accounting firm pursuant to temporary rules of the Securities and Exchange
Commission (the “SEC”) that allows us to provide only management’s report in
this annual report.




Under the
supervision and with the participation of our senior management, consisting of
our chief executive officer and our chief financial officer, we conducted an
evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended, as of the end of the period covered
by this report (the “Evaluation Date”). Although we performed an evaluation of
our internal control over financial reporting, we unintentionally omitted a
report detailing our conclusions regarding the assessment of our internal
control over financial reporting in the Annual Report filed with the SEC on May
7, 2008. Due to the foregoing, we determined that our disclosure controls and
procedures were not effective as of the Evaluation Date.




(b)
Changes in Internal Control over Financial Reporting. There were no changes in
our internal control over financial reporting that occurred during the last
fiscal quarter of the period covered by this report that have materially
affected or are reasonably likely to materially affect our internal control over
financial reporting.




ITEM
9B. OTHER INFORMATION




None.




ITEM
10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CORPORATE
GOVERNANCE




Our directors and officers as of December 31,
2008 are:




Name
              
              Age
              
              Position(s)
      with the CompanyDr.
      Earl Azimov
              
              
              46
              
              
              Chairman
      of the BoardJohn
      Grob
              
              
              59
              
              
              President
      and DirectorKenneth
      S. Adessky
              
              
              45
              
              
              Chief
      Financial Officer, Secretary and DirectorPaul
      Whitton
              
              
              63
              
              
              Vice-President
      and Director




24




Dr. Earl Azimov:
Dr. Azimov has served as a Director and Chairman of our Board since
August 2006. Dr. Azimov is currently the Chief Executive Officer of
Miazzi Ventures Inc., a merchant bank that he co-founded that has assumed
leadership roles in early stage companies since 1996, including Mamma.com, which
was sold in 1999 for an eight-figure valuation. In addition, from 2003 through
early 2007, Dr. Azimov was the co-founder and Director of Business
Development for GospelCity.Com, Inc., a world leader of on-line faith-based
gospel entertainment. From 1992 through 1995, Dr. Azimov was the President of
Zellers Optical Centers, a company he co-founded that employed over 70
optometrists and 200 support personnel that was later sold to National Vision
Associates of Atlanta, who operate the Wal-Mart Vision Centers. Dr. Azimov
brings 20 years of private equity experience, focusing on seed capital
investments in startup companies. He has a Bachelor of Science from the
University of South Carolina and a Doctorate of Optometry from the University of
Montreal — School of Optometry, in Montreal, Quebec, Canada.




John Grob: Mr. Grob has
served as a Director since August 2006, and in November 2007 Mr. Grob
was again appointed as our President. Mr. Grob also served as CEO and
President of the Company from August 2006 until March 2007. In 1968,
Mr. Grob began his career at Lloyds Insurance as a broker. In 1975, he
started, owned and managed The Mortgage Corporation, the UK’s first mortgage
bank. From 1975 to 1987, his company securitized and sold over
£1,000 million in mortgage bonds, and in 1987, he sold The Mortgage
Corporation to Salomon Brothers. Since 1987, Mr. Grob has acted as a
financial and technical consultant to the Governments of Brazil, Portugal, South
Africa and Turkey as well as The UK Ministry of Defense. He has guided several
American companies in commercializing new technologies, most recently a
composite reinforced hi-tension electrical cable for use on power transmission
grids. During the past five years, Mr. Grob has worked to develop a
renewable energy business, including working closely with the UK Government, UK
Coal and British Nuclear Fuels to find a successful technical solution to the
profitable processing of waste streams and coal into clean renewable energy.
Mr. Grob was privately educated in the UK.




Kenneth S. Adessky:
Mr. Adessky has been our Chief Financial Officer, Secretary and a Director
since August 2006. Mr. Adessky is currently a Senior Partner of
Adessky Lesage, a corporate commercial law firm located in Montreal, Canada that
he co-founded in 1995. As a Senior Partner, Mr. Adessky focuses his legal
practice on private and public financings, mergers and acquisitions and public
offerings of small capital public companies. Over the past decade,
Mr. Adessky has completed in excess of $100 million dollars of
financing. Mr. Adessky received his Bachelor of Civil Law from McGill
University in Montreal, Quebec, Canada in 1990.




Paul Whitton: Mr. Whitton
currently serves as our Vice-President, and he has served as a Director since
June 2007. Since 1998, Mr. Whitton has been the owner of JK, Inc., an
environmental consulting company based in Houston, Texas. Mr. Whitton holds
numerous patents relating to industrial environmental quality and is a
nationally recognized speaker on abatement. Prior to 1988, he spent
22 years with Brown & Root Construction Company where he was an area
superintendent for construction and maintenance of oil and gas refineries,
nuclear power plants, and paper mills throughout the world but primarily the
Mideast and United Kingdom. He was also a construction supervisor with Boeing
Air and in the United States Navy for four years. Mr. Whitton brings
industrial plant management and construction experience as well as his
environmental expertise to the Company.




Family
Relationships




There are
no family relationships among our officers and directors.




Involvement
in Certain Legal Proceedings




None of
our directors or executive officers has been involved in any transactions with
us or any of our directors, executive officers, affiliates or associates that
are required to be disclosed pursuant to the rules and regulations of the SEC
other than as set forth in “Item 13. Certain Relationships and Related
Transactions, and Director Independence” below. None of the directors or
executive officers to our knowledge has been convicted in a criminal proceeding,
excluding traffic violations or similar misdemeanors, or has been a party to any
judicial or administrative proceeding during the past five years that resulted
in a judgment, decree or final order enjoining the person from future violations
of, or prohibiting activities subject to, federal or state securities laws, or a
finding of any violation of federal or state securities laws, except for matters
that were dismissed without sanction or settlement.




25




Section 16(a)
Beneficial Ownership Reporting Compliance




Section 16(a)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
requires the Company’s directors, executive officers and holders of more than
10% of the Company’s common stock to file with the Securities and Exchange
Commission initial reports of ownership and reports of changes in ownership of
common stock and other equity securities of the Company. Except as set forth
below, the Company believes that during the year ended December 31, 2008,
its officers, directors and holders of more than 10% of the Company’s common
stock complied with all Section 16(a) filing requirements. In making these
statements, the Company has relied solely upon its review of copies of the
Section 16(a) reports filed for the fiscal year ended December 31, 2008 on
behalf of the Company’s directors, officers and holders of more than 10% of the
Company’s common stock.




Term
of Office




The term
of office of the current directors shall continue until new directors are
elected or appointed.




Committees
of the Board and Financial Expert




We do not
have a separately-designated audit or compensation committee of the Board or any
other Board-designated committee. Audit and compensation committee functions are
performed by our Board of Directors. We will form such committees in the future
as the need for such committees may arise. In addition, at this time we have
determined that we do not have an “audit committee financial expert” as defined
by the SEC on our Board.




Code
of Ethics




We have
adopted a Code of Ethics for our senior officers, including our principal
executive officer, principal financial officer, principal accounting officer or
controller and any person who may perform similar functions.  We will
report the nature of any change or waiver of our Code of Ethics.  A
copy of our Code of Ethics was filed as Exhibit 14 on the Company’s Form 10-KSB
for the year ended December 31, 2003 and incorporated herein by
reference.




ITEM 11. EXECUTIVE
COMPENSATION




Compensation
Committee




We do not
have a separately-designated compensation committee of the Board. Compensation
committee functions are performed by our Board of Directors. We will form a
compensation committee in the future as the need for such committee may
arise.




Compensation
of Executive Officers




The
following table sets forth information concerning the compensation of our named
executive officers for the fiscal year ended December 31, 2008. Any
payments to these officers were paid to them as consultants, not employees, of
the Company, as the Company has not yet hired full or part-time employees. We
may, once we are operational, implement employee benefits that will be generally
available to all employees and subsidiary employees, including medical, dental
and life insurance benefits and a 401(k) retirement savings plan.




26




Name
      and Principal Position (1)
                              Year
                              Salary
      ($)
                              Bonus
                                ($)
                              Stock
                                Award
                                ($)
                              Option
                                Awards
                                ($)
                              Non-Equity
                                Incentive
      Plan
                                Compensation
                                ($)
                              Change
      in
                                Pension
                                Value
      and
                                Nonqualified
                                Deferred
                                Compensation
                                Earnings
      ($)
                              All
      Other
                                Compensation
                                ($)
                              Total
                                ($)John
      Grob,
                              2008
                              $
                              96,000
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              $
                              96,000President
      (2)
                              2007
                              $
                              84,000
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              $
                              84,000Kenneth
      Adessky,
                              2008
                              $
                              72,000
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              $
                              72,000CFO
      and Secretary (3)
                              2007
                              $
                              42,000
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              $
                              42,500Paul
      Whitton,
                              2008
                              $
                              9,000
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              
                              $
                              9,000Vice-President
      (4)
                              2007





(1)
            Each
      of Mr. Grob, Mr. Adessky and Mr. Whitton currently serve on
      the Company’s Board of Directors. None of these persons receive any
      compensation for these director
roles.




(2)
            All
      fees paid to Mr. Grob during fiscal 2007 and 2008 were as a
      consultant to the Company.




(3)
            All
      fees paid to Mr. Adessky during fiscal 2007 and 2008 were as a
      consultant to the Company.




(4)
            All
      fees paid to Mr. Whitton during fiscal 2008 were as a consultant to the
      Company.




Compensation
of Directors




The
Company has no standard arrangements in place or currently contemplated to
compensate the Company’s directors for their service as directors or as members
of any committee of directors.




Employment
Agreements




We do not
have employment agreements with any of our executive officers or directors. We
have verbal understandings with our executive officers regarding monthly
retainers and reimbursement for actual out-of-pocket expenses.




Termination
of Employment




There are
no compensatory plans or arrangements, including payments to be received from
the Company, with respect to any person named in the Summary Compensation Table
set forth above that would in any way result in payments to any such person
because of his or her resignation, retirement or other termination of such
person’s employment with us.




Indemnification
of Officers and Directors




We
indemnify to the fullest extent permitted by, and in the manner permissible
under, the laws of the State of Maryland, any person made, or threatened to be
made, a party to an action or proceeding, whether criminal, civil,
administrative or investigative, by reason of the fact that he/she is or was a
director or officer of our Company, or served any other enterprise as director,
officer or employee at our request. Our board of directors, in its discretion,
shall have the power on behalf of the Company to indemnify any person, other
than a director or officer, made a party to any action, suit or proceeding by
reason of the fact that he/she is or was our employee.




27




Employee
Benefit Plans




2007
Stock Incentive Plan




We have
adopted the 2007 Stock Incentive Plan for our employees, officers, directors and
advisors (the “2007 Plan”). We have reserved a maximum of 5,000,000 common
shares to be issued upon the grant of awards under the 2007 Plan. Employees will
recognize taxable income upon the grant of common stock equal to the fair market
value of the common stock on the date of the grant and the Company will
recognize a compensating deduction for compensation expense at such time. The
2007 Plan will be administered by our board of directors or a committee of
directors, and will terminate June 12, 2017. As of December 31, 2008, no
shares have been awarded under the 2007 Plan.





ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS




The
following table sets forth, as of December 31, 2008, the stock ownership of
(i) each of our named executive officers and directors, (ii) all
executive officers and directors as a group, and (iii) each person known by us
to be a beneficial owner of 5% or more of our common stock. No person listed
below has any option, warrant or other right to acquire additional securities
from us, except as may be otherwise noted. We believe that all persons named in
the table have sole voting and investment power with respect to all shares of
common stock beneficially owned by them except as stated therein.




Name and Address
                              
                              Amount
      & Natureof
      Beneficial
                              
                              of
      Beneficial
                              
                              
                              PercentOwner
      (1)
                              
                              Ownership
                              
                              
                              of
      Class (2)Kenneth
      S. Adessky
                              
                              
                              6,137,500
                              
                              
                              
                              24.47
                              %4150
      Sainte-Catherine Street W.
                                Suite 525
                                Montreal,
      Quebec H3Z 2Y5Dr. Earl
      Azimov
                              
                              
                              5,550,000
                              
                              
                              
                              22.13
                              %5737
      Blossom
                                Cote
      St Luc, Quebec H4W 2T2John
      Grob (3)
                              
                              
                              5,550,000
                              
                              
                              
                              22.13
                              %Amherst
      House
                                Stowlangtoft
                                Bury
      St-Edmunds, UK 1P313JYPaul
      Whitton
                              
                              
                              50,000
                              
                              
                              
                              *2415
      Shakespeare #3
                                Houston,
      Texas 77936Vision
      Capital Partners
                                4150
      St. Catherine Street West, Suite 525
                                Montreal
      H3Z 3J1
                              
                              
                              107,500
                              
                              
                              
                              ***
      All officers and directors
                              
                              
                              17,395,000
                              
                              
                              
                              69.00
                              %as
      a group (4 persons)





*Less
      than 5%.




28




(1)
            Beneficial ownership is
      determined in accordance with the Rule 13d-3(a) of the Securities
      Exchange Act of 1934, as amended, and generally includes voting or
      investment power with respect to securities. Except as subject to
      community property laws, where applicable, the person named above has sole
      voting and investment power with respect to all shares of our common stock
      shown as beneficially owned by
him.




(2)
            The beneficial ownership percent
      in the table is calculated with respect to the number of outstanding
      shares 25,378,721 of the Company’s common stock as of December 31, 2008,
      and each stockholder’s ownership is calculated as the number of shares of
      common stock owned plus the number of shares of common stock into which
      any preferred stock, warrants, options or other convertible securities
      owned by that stockholder can be converted within
      60 days.




(3)
            Includes 1,000,000 shares owned
      by Mr. Grob’s wife, and 200,000 shares owned by his minor
      son.




The term
“named executive officer” refers to our principal executive officer, our two
most highly compensated executive officers other than the principal executive
officer who were serving as executive officers at the end of 2008, and two
additional individuals for whom disclosure would have been provided but for the
fact that the individuals were not serving as executive officers of the Company
at the end of 2008.




Please
refer to the table titled “Securities Authorized for Issuance under Equity
Compensation Plans” set forth in Item 5 for a description of securities
authorized for issuance under equity compensation plans.




ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE




Except as
described in the following paragraphs, none of our officers or directors, nor
any person who beneficially owns, directly or indirectly, shares carrying more
than 5% of the voting rights attached to our outstanding shares, nor any of our
promoters, nor any relative or spouse of any of the foregoing persons has any
material interest, direct or indirect, in any transaction since January 1,
2008 or in any presently proposed transaction that, in either case, has
affected, or will materially affect the Company.




During
2008, we paid legal fees totaling $21,426 to a law firm of which
Mr. Adessky, our CFO, Secretary and Director, is a partner.




In March
2008, we issued 107,500 shares of our common stock for the conversion of an
unsecured loan which was executed in March 2007 between the Company and Vision
Capital Partners in the amount of $100,000. Dr. Azimov, Chairman of the
Company’s Board, and Mr. Adessky, the Company’s CFO, Secretary and a Director,
each owns 50% of Vision Capital and is an officer and director of Vision
Capital.




In August
2008, Vision Capital loaned the Company $80,000. The promissory note is
unsecured, accrues interest at 7.5% per annum and is due in one year.
Dr. Azimov, Chairman of the Company’s Board, and Mr. Adessky, the
Company’s CFO, Secretary and a Director, each owns 50% of Vision Capital and is
an officer and director of Vision Capital.




Dr.
Azimov, the Chairman of the Company’s Board of Directors, earned consulting fees
at a monthly retainer of $6,000, for an aggregate of $72,000 for the fiscal year
ended December 31, 2008. These fees were accrued to Dr. Azimov for his services
as a consultant to the Company.




The
Company has no understanding with its officers, directors or shareholders,
pursuant to which such persons are required to contribute capital to the
Company, loan money or otherwise provide funds to us, although management
expects that one or more of such persons may make funds available to us in the
event of need to cover operating expenses.




29




Director
Independence




Our
current directors are Dr. Earl Azimov, Paul Whitton, Kenneth Adessky and
John Grob. We are not currently subject to corporate governance standards
defining the independence of our directors. We have not yet adopted an
independence standard or policy, although we intend to do so in the near future.
Accordingly, the Company’s Board currently determines the independence of each
Director and nominee for election as a Director. The Board has determined that
none of the Company’s directors currently qualifies as an independent
director.




ITEM 14. PRINCIPAL
ACCOUNTANT FEES AND SERVICES




Audit
Fees




The
aggregate fees billed by the Company’s auditors for professional services
rendered in connection with the audit of the Company’s annual financial
statements and reviews of the financial statements included in the Company’s
Form 10-QSBs or services that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements for fiscal years
2008, and 2007 were $0 and $5,000 and respectively.




Audit
Related Fees




None.




Tax
Fees




None.




All
Other Fees




None.




Pre-Approval
Policies and Procedures




Our Board
of Directors has adopted resolutions in accordance with the Sarbanes-Oxley Act
of 2002 requiring pre-approval of all auditing services and all audit related,
tax or other services not prohibited under Section 10A(g) of the Securities
Exchange Act of 1934, as amended to be performed for us by our independent
auditor, subject to the de minimus exception described in Section 10A(i)(1)(B)
of the Exchange Act. These resolutions authorized our independent auditor to
perform audit services required in connection with the annual audit relating to
our fiscal year ended December 31, 2008 and the quarterly reviews for the
subsequent fiscal quarters of 2008 through the quarter ended September 30,
2008, at which time additional pre-approvals for any additional services to be
performed by our auditors would be sought from the Board. Our Board of Directors
also appointed and authorized Kenneth Adessky to grant pre-approvals of other
audit, audit-related, tax and other services requiring board approval to be
performed for us by our independent auditor, provided that the designee,
following any such pre-approvals, thereafter reports the pre-approvals of such
services at the next following regular meeting of the Board.




The
percentage of audit-related, and other services that were approved by the Board
of Directors is 100%.




ITEM
15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
  ExhibitNumber
                
                Exhibit
      Description2.1
                
                November 7,
      2007 Agreement and Plan of Merger between Newsearch, Inc. and Global Clean
      Energy, Inc. (Incorporated by reference to the Company’s Current Report on
      Form 8-K filed with the Commission on November 13,
      2007).
  30
  3.1
                                                              
                                                              Amended
      and Restated Articles of Incorporation (Incorporated by reference to the
      Company’s Annual Report on Form 10-KSB for the year ended December
      31, 2006 filed with the Commission on May 7,
2007).3.2
                                                              
                                                              Bylaws
      of Global Clean Energy, Inc. (Incorporated by reference to the Company’s
      Current Report on Form 8-K filed with the Commission on
      November 13, 2007).4.1
                                                              
                                                              Specimen
      Common Stock Certificate (Incorporated by reference to the Company’s
      Registration Statement on Form 10SB-12G filed with the Commission on
      April 12, 2000).4.2
                                                              
                                                              $100,000,
      7.5% Promissory Note dated January 20, 2008 payable Profit Consultants,
      Inc. (Incorporated by reference to the Company’s Current Report on Form
      8-K filed with the Commission on March 27, 2008).4.3
                                                              
                                                              $125,000,
      7.5% Promissory Note dated April 25, 2008 payable Profit Consultants, Inc.
      (Incorporated by reference to the Company’s Current Report on Form 8-K
      filed with the Commission on June 30, 2008).4.4
                                                              
                                                              $145,000,
      7.5% Promissory Note dated July 10, 2008, payable to Clean Energy Funding,
      Inc. (Incorporated by reference to the Company’s Quarterly Report on Form
      10-Q filed with the Commission on November 13, 2008).4.5
                                                              
                                                              $80,000,
      7.5% Promissory Note dated August 15, 2008, payable to Vision Capital
      Partners AA, Ltd. (Incorporated by reference to the Company’s Quarterly
      Report on Form 10-Q filed with the Commission on November 13,
      2008).4.6
                                                              
                                                              $42,300,
      7.5% Promissory Note dated October 1, 2008, payable to Mr. Howard Stupp.
      *10.1
                                                              
                                                              2007
      Stock Incentive Plan (Incorporated by reference to the Company’s Current
      Report on Form 8-K filed with the Commission on June 12,
      2007).10.2
                                                              
                                                              License
      Agreement dated December 15, 2006, between EnviroClean Energy
      Corporation and the Company (Incorporated by reference to the Company’s
      Current Report on Form 8-K filed with the Commission on
      January 4, 2007).10.3
                                                              
                                                              March
      27, 2008 Agreement converting the March 21, 2007 $100,000 7.5% Promissory
      Note payable to Vision Capital Partners AA Ltd. into shares of the
      Company’s common stock (Incorporated by reference to the Company’s
      Quarterly Report on Form 10-Q filed with the Commission on May 15,
      2008).10.4
                                                              
                                                              March
      27, 2008 Agreement converting the August 16, 2007 $75,000 7.5% Promissory
      Note payable to Profit Consultants, Inc. into shares of the Company’s
      common stock (Incorporated by reference to the Company’s Quarterly Report
      on Form 10-Q filed with the Commission on May 15,
2008).10.5
                                                              
                                                              March
      27, 2008 Agreement converting the October 20, 2007 $75,000 7.5% Promissory
      Note payable to Profit Consultants, Inc. into shares of the Company’s
      common stock (Incorporated by reference to the Company’s Quarterly Report
      on Form 10-Q filed with the Commission on May 15,
2008).10.6
                                                              
                                                              Memorandum
      of Understanding between Global Clean Energy, Inc. and UK Coal Mining
      Limited of Harworth Park, dated April 7, 2008 (Incorporated by
      reference to the Company’s Current Report on Form 8-K filed with the
      Commission on May 30, 2008).10.7
                                                              
                                                              Memorandum
      of Understanding between Global Clean Energy, Inc. and UK Coal Mining
      Limited of Harworth Park, dated April 7, 2008 (Incorporated by
      reference to the Company’s Current Report on Form 8-K filed with the
      Commission on May 30,
2008).
  31
  10.8
                
                April 24,
      2008 Purchase Order Between Global Clean Energy, Inc. and Cascades
      Engineering & Projects Inc. (Incorporated by reference to the
      Company’s Current Report on Form 8-K filed with the Commission on
      May 30, 2008).10.9
                
                Assignment
      Agreement between Global Clean Energy, Inc. and Philip Azimov dated
      June 26, 2008 (Incorporated by reference to the Company’s Current
      Report on Form 8-K filed with the Commission on June 26,
      2008).14
                
                Code
      of Ethics (Incorporated by reference to the Company’s Annual Report on
      Form 10-KSB of the Company for the year ended December 31, 2003
      filed with the Commission on November 17, 2004).21
                
                Description
      of Subsidiaries (Incorporated by reference to the Company’s Annual Report
      on Form 10-KSB of the Company for the year ended December 31, 2007 filed
      with the Commission on May 6, 2008).31.1
                
                Rule 13a-14(a)/15d-14(a)
      Certification by the Principal Executive Officer*31.2
                
                Rule 13a-14(a)/15d-14(a)
      Certification by the Principal Financial Officer*32.1
                
                Section 1350
      Certification by the Principal Executive Officer*32.2
                
                Section 1350
      Certification by the Principal Financial Officer**
                Filed
      herewith.
  32
 SIGNATURES
  In
accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934,
the registrant caused this Report on Form 10-K to be signed on its behalf by the
undersigned, thereto duly authorized.
  Date:
April 15, 2009
  GLOBAL
      CLEAN ENERGY, INC.By
      /s/ Kenneth S. AdesskyKenneth
      S. AdesskyChief
      Financial Officer
  In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
  Signature
                                
                                Title
                                
                                Date/s/
      Dr. Earl Azimov
                                
                                Chairman
      of the Board
                                
                                April
      15, 2009Dr. Earl
      Azimov/s/
      John Grob
                                
                                Director
      and President
                                
                                April
      15, 2009John
      Grob/s/
      Kenneth S. Adessky
                                
                                Director,
      CFO and Secretary
                                
                                April
      15, 2009Kenneth
      S. Adessky/s/
      Paul Whitton
                                
                                Director
      and Senior Vice-President
                                
                                April
      15, 2009Paul
      Whitton
  33
 
 GLOBAL CLEAN ENERGY, INC.
 Financial
Statements
 Table
of Contents
  PageReport
      of Independent Registered Public Accounting Firm
                
                
                F-1Financial
      Statements:Balance
      Sheet
                
                
                F-2Statements
      of Operations
                
                
                F-3Statements
      of Changes in Stockholders’ Equity
                
                
                F-4Statements
      of Cash Flows
                
                
                F-5Notes
      to Financial Statements
                
                
                F-6
      - F-10
  
 
 Larry O’Donnell, CPA, P.C.
 Telephone
      (303) 745-4545
              
              2228
      South Fraser StreetUnit
      IAurora,
      Colorado 80014
 
 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  The Board
of Directors
  GLOBAL
CLEAN ENERGY, Inc.
  I have
audited the accompanying balance sheet of GLOBAL CLEAN ENERGY, Inc. as of
December 31, 2008, and the related statements of operations, changes in
stockholders’ equity and cash flows for each of the years in the two-year period
ended December 31, 2008. These financial statements are the responsibility
of the Company’s management. My responsibility is to express an opinion on these
financial statements based on my audits.
  I
conducted my audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that I plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. I believe that my audits provide a reasonable
basis for my opinion.
  In my
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of GLOBAL CLEAN ENERGY, Inc. as of
December 31, 2008, and the results of its operations and their cash flows
for each of the years in the two-year period ended December 31, 2008, in
conformity with generally accepted accounting principles in the United States of
America.
   /s/
Larry O’Donnell, CPA, P.C.
  April 9,
2009
  F-1
  GLOBAL
CLEAN ENERGY, INC.
 Balance
Sheet
 DECEMBER
31, 2008
 ASSETSCurrent
      assets:Cash
                          
                          $
                          45,858Other
      assets:Cyclonic
      Dredging Pump Rights and Patent
                          
                          
                          450,000Total
      assets
                          
                          $
                          495,858LIABILITIES
      AND STOCKHOLDERS’ EQUITYCURRENT
      LIABILITIES:Accrued
      compensation—officers, directors and consultants
                          
                          
                          523,968Accounts
      payable
                          
                          
                          125,688Promissory
      notes
                          
                          
                          486,900$
                          1,136,556Stockholders’
      equity:Preferred
      stock; $.001 par value; authorized – 15,000,000shares;
      issued - noneCommon
      stock; $.001 par value; authorized – 300,000,000shares;
      issued and outstanding – 25,378,721 shares
                          
                          
                          25,378Additional
      paid-in capital
                          
                          
                          1,478,555Accumulated
      deficit
                          
                          
                          (2,144,631
                          )Total
      liabilities and stockholders’ equity
                          
                          $
                          495,858
 
 See notes to financial
statements.
  F-2


GLOBAL
CLEAN ENERGY, INC.
 STATEMENTS
OF OPERATIONS
 Year Ended December
    31,2008
                              
                              
                              2007Costs
      and expenses:Compensation
      – officers, directors and consultants
                              
                              $
                              245,562
                              
                              
                              $
                              364,168Professional  fees
                              
                              
                              145,320
                              
                              
                              
                              240,471General
      and administrative
                              
                              
                              99,221
                              
                              
                              
                              71,167Impairment
      loss-technology license
                              
                              
                              
                              
                              
                              
                              150,000Depreciation
                              
                              
                              
                              
                              
                              
                              1,679Interest
                              
                              
                              1,744
                              
                              
                              
                              9,684Net
      loss applicable to common shareholders
                              
                              $
                              (668,231
                              )
                              
                              $
                              (837,169
                              )Basic
      and diluted net loss per common share
                              
                              
                              (.02
                              )
                              
                              
                              (.03
                              )Weighted
      average number of common shares outstanding
                              
                              
                              25,378,721
                              
                              
                              
                              24,815,521
  See notes to financial
statements.
  F-3
 GLOBAL
CLEAN ENERGY, INC.
 Statements
of Changes in Stockholders’ Equity
 AdditionalCommon Stock
                                
                                
                                Paid-in
                                
                                
                                AccumulatedShares
                                
                                
                                Amount
                                
                                
                                Capital
                                
                                
                                DeficitBalances,
      January 1, 2008
                                
                                
                                24,815,521
                                
                                
                                $
                                24,815
                                
                                
                                
                                765,918
                                
                                
                                $
                                (1,476,400
                                )Technology
      Patent Assignment
                                
                                
                                300,000
                                
                                
                                
                                300
                                
                                
                                
                                449,700Conversion
      of Promissory notes
                                
                                
                                263,200
                                
                                
                                
                                263
                                
                                
                                
                                262,937Net
      loss
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                ( 668,231
                                )Balances,
      December 31, 2008
                                
                                
                                25,378,721
                                
                                
                                $
                                25,378
                                
                                
                                $
                                1,478,555
                                
                                
                                
                                (2,144,631
                                )
  See notes to financial
statements.
  F-4
 GLOBAL
CLEAN ENERGY, INC.
 STATEMENTS
OF CASH FLOWS
  
 
 Year Ended December
    31,2008
                                      
                                      
                                      2007Cash
      flows from operating activities:Net
      loss
                                      
                                      $
                                      (668,231
                                      )
                                      
                                      
                                      (837,169
                                      )Adjustments
      to reconcile net loss to net cashused
      in operating activities:Common
      stock issued for services
                                      
                                      
                                      
                                      
                                      
                                      
                                      80,000Forgiveness
      of interestDepreciation
                                      
                                      
                                      
                                      
                                      
                                      
                                      1,679Impairment
      loss- Technology License
                                      
                                      
                                      
                                      
                                      
                                      
                                      150,000Changes
      in operating assets and liabilities:Prepaid
      legal
                                      
                                      
                                      
                                      
                                      
                                      
                                      2,500Accounts
      Payable
                                      
                                      
                                      125,688Advances
                                      
                                      
                                      
                                      
                                      
                                      
                                      10,000Accrued
      compensation – officers, directors and consultants
                                      
                                      
                                      523,968
                                      
                                      
                                      
                                      229,199Other
      accrued expenses
                                      
                                      
                                      
                                      
                                      
                                      
                                      137,310Net
      cash used in operating activities
                                      
                                      
                                      (221,493
                                      )
                                      
                                      
                                      (226,481
                                      )Cash
      flows from investing activities:Purchases
      of equipmentNet
      cash used in investing activitiesCash
      flows from financing activities:Proceeds
      from promissory notes
                                      
                                      
                                      492,300
                                      
                                      
                                      
                                      220,000Repayment
      of stockholders loanNet
      cash provided by financing activities
                                      
                                      
                                      492,300
                                      
                                      
                                      
                                      220,000Net
      increase in cash
                                      
                                      
                                      51
                                      
                                      
                                      
                                      51Cash
      at beginning of yearCash
      at end of year
                                      
                                      
                                      45,858
                                      
                                      
                                      
                                      51Supplemental
      disclosure of noncash investing andfinancing
      activities:Common
      Stock issued for services
                                      
                                      
                                      
                                      
                                      
                                      
                                      80,000Technology
      Patent Assignment
                                      
                                      
                                      450,000Conversion
      of Promissory Notes
                                      
                                      
                                      263,200
  See notes to financial
statements.
  F-5
 
 GLOBAL
CLEAN ENERGY, Inc.
 Notes
to Financial Statements
  Note 1 -
Organization
 
 GLOBAL
CLEAN ENERGY, Inc. (“GLOBAL CLEAN ENERGY” or “GCE”) is a Maryland corporation
formed on November 8, 2007. GCE is successor to Newsearch, Inc. (“Newsearch”), a
Colorado corporation, which was incorporated on December 3,
1999.  Newsearch was dormant until August 20, 2002, when it acquired
Panache, Inc. (“Panache”), a Colorado corporation, and Panache became a
wholly-owned subsidiary of Newsearch.  Panache sold women’s apparel
under its trade name, “The Ollie Collection,” on a wholesale basis , represented
several manufacturers of women’s apparel and accessories and also bought and
resold women’s apparel and accessories for its own account, for resale. Panache
ceased operations in June 2004, when it determined that its business plan could
not be executed due to a lack of operating capital and prospects for raising
adequate funding, and was later dissolved in January 2005. Newsearch was dormant
from July 2004 through July 2006 when it began operating in furtherance of its
current business plan. On November 13, 2007, Newsearch’s state of incorporation
was changed from Colorado to Maryland when it was merged with GCE.
  GCE was
formed to develop and commercialize proprietary “R.E.S.C.U.E” technologies which
recover and reform environmental salvage into clean useable
energy.  As global reserves diminish, biodiesel and other synthetic
fuels are now regarded as realistic alternatives to oil. The combination of
fears about declining conventional oil reserves, increasing demand from
developing countries like India and China, and dependence on unstable suppliers
in the Middle East and elsewhere, has generated tremendous interest in
developing alternative energy sources.  GCE is at the forefront of
global initiatives to reduce greenhouse gas emissions and lower the dependency
in the USA and Europe on imported oil and natural gas with its proprietary and
innovative technologies for clean coal and other renewable energy
sources.
  We work
with both the governmental and private sectors on projects which seek to
implement profitable renewable energy while cleaning specific environmental
problem areas. What began as a search for best of breed technologies to convert
waste and biomass into clean renewable energy, has evolved and expanded into
five areas of active business development: (i) research and development of new
technologies; (ii) international joint-ventures to develop waste-to-energy
projects; (iii) technology and services for environmental ash cleanup
operations; (iv) renewable energy production; and (v) seeking public financing
for projects in the green energy sector.
  The
financial statements have been prepared on a going concern basis, which
contemplates the realization of assets and the settlement of liabilities and
commitments in the normal course of business.  GLOBAL CLEAN ENERGY has
an accumulated deficit of $2,144,631 for the year ending December 31,
2008.  We have raised funds over the last year and are actively
pursuing additional sources of equity or debt financing to implement our
business model.
  Note 2 - Summary of
Significant Accounting Policies
 
 Use
of 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 reporting amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the periods.  Management makes these estimates using the best
information available at the time the estimates are made; however, actual
results could differ materially from these estimates.
  F-6
  Equipment
  Equipment
is recorded at cost and depreciated using the straight-line method over
estimated useful lives of three to five years.  Both straight-line and
accelerated methods of depreciation are used for income tax
purposes.
  Impairment
of Long-Lived Assets
  GLOBAL
CLEAN ENERGY records impairment losses on long-lived assets used in operations
and finite lived intangible assets when events and circumstances indicate the
assets might be impaired and the undiscounted cash flows estimated to be
generated by those assets are less than their carrying amounts.  The
impairment loss is measured by comparing the fair value of the asset to its
carrying amount.
  Financial
Instruments
  Unless
otherwise indicated, the fair value of all reported assets and liabilities which
represent financial instruments (none of which are held for trading purposes)
approximate the carrying values of such amounts.
  Stock-Based
Compensation
  GLOBAL
CLEAN ENERGY accounts for stock-based compensation in accordance with SFAS No.
123(R) Share-Based Payment.  Under the fair value recognition
provisions of this statement, stock-based compensation cost is measured at the
grant date based on the fair value of the award and is recognized as expense on
a straight-line basis over the requisite service period, which is the vesting
period.  We elected the modified-prospective method, under which prior
periods are not revised for comparative purposes.  The valuation
provisions of SFAS 123R apply to new grants and to grants that were outstanding
as of the effective date and subsequently modified.
  During
the years ended December 31, 2008 and 2007, there were no stock options granted
or outstanding.
  Comprehensive
Income
  SFAS No.
130, Reporting Comprehensive Income, establishes requirements for disclosure of
comprehensive income (loss).  During the years ended December 31, 2008
and 2007, GLOBAL CLEAN ENERGY did not have any components of comprehensive
income (loss) to report.
  Net
Loss Per Share
  SFAS No.
128, Earnings per Share, requires dual presentation of basic and diluted
earnings or loss per share (“EPS”) for all entities with complex capital
structures and requires a reconciliation of the numerator and denominator of the
basic EPS computation to the numerator and denominator of the diluted EPS
computation.  Basic EPS excludes dilution; diluted EPS reflects the
potential dilution that could occur if securities or other contracts to issue
common stock were exercised or converted into common stock or resulted in the
issuance of common stock that then shared in the earnings of the
entity.
  Basic
loss per share is computed by dividing net loss applicable to common
shareholders by the weighted average number of common shares outstanding during
the period.  Diluted loss per share reflects the potential dilution
that could occur if dilutive securities and other contracts to issue common
stock were exercised or converted into common stock or resulted in the issuance
of common stock that then shared in the earnings of GLOBAL CLEAN ENERGY, unless
the effect is to reduce a loss or increase earnings per share.  GLOBAL
CLEAN ENERGY had no potential common stock instruments which would result in a
diluted loss per share.  Therefore, diluted loss per share is
equivalent to basic loss per share.
  F-7
  Recently
Issued Accounting Pronouncements
  In June
2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in
Income Taxes - An Interpretation of FASB Statement No. 109, (“FIN
48”).  FIN 48 clarifies the accounting for uncertainty in income taxes
recognized in an enterprise’s financial statements in accordance with FASB
Statement No. 109, Accounting for Income Taxes.  FIN 48 also
prescribes a recognition threshold and measurement attribute for the financial
statement recognition and measurement of a tax position taken or expected to be
taken in a tax return that results in a tax benefit.  Additionally,
FIN 48 provides guidance on de-recognition, income statement classification of
interest and penalties, accounting in interim periods, disclosure, and
transition.  This interpretation is effective for fiscal years
beginning after December 15, 2006.  GLOBAL CLEAN ENERGY does not
expect the application of FIN 48 to have a material affect on its financial
statements.
  In
September 2006, the FASB issued SFAS No. 157, Fair Value
Measurements.  This statement defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles,
and expands disclosures about fair value measurements.  This statement
applies under other accounting pronouncements that require or permit fair value
measurements.  SFAS 157 is effective for fiscal years beginning after
November 15, 2006.  GLOBAL CLEAN ENERGY does not expect the
application of SFAS No. 157 to have a material affect on its financial
statements.
  Note 3 – AIRPUMP PATENT
ASSIGNMENT
 
 Global Clean Energy, Inc.,acquired the entire right, title and interest
in and to a static fluid mixing pump device,set forth in a Patent
applicationfor Letters Patent of the United States,filed on June 30th, 2008
as a U.S. Patent Application; as
well as the inventions and Application for Letters Patent of the United States,
and in and to any Letters Patent of the United States to be obtained therefore
and thereon from Mr. Philip Azimov for the consideration of 300,000 common
shares.
  Note 4 –
Borrowings
 
 In 2008,
GLOBAL CLEAN ENERGY obtained five unsecured loans which were due in one year,
each with an interest rate of 7.5% per annum;
  On
October 1, 2008, Mr. Howard Stupp loaned to the Company the amount of $42,300,
which accrues interest at 7.5% per annum due in one year.
  On August
1, 2008, Vision Capital Partners AA Ltd. loaned to the Company the amount of
$80,000, which accrues interest at 7.5% per annum due in one year.
  On July
10, 2008, Clean Energy Funding, Inc., Inc. loaned to the Company the amount of
$145,000, which accrues interest at 7.5% per annum due in one year.
  On April
25, 2008, Profit Consultants, Inc. loaned to the Company the amount of $125,000,
which accrues interest at 7.5% per annum due in one year.
  On
January 20, 2008 Profit Consultants, Inc. loaned to the Company the amount of
$100,000 which accrues interest at 7.5% per annum due in one year from such
date.
  F-8
  Note 5 - Stockholders’
Equity
 
 Common
Stock
  In March
2008, we issued 263,200 shares of our common stock for the conversion of three
unsecured loans which were due in one year, each with an interest rate of
7.5%.  The first loan was executed in March 2007 between the Company
and Vision Capital Partners in the amount of $100,000, the second loan was
executed in August 2007 between the Company and Profit Consultants in the amount
of $75,000, and the third loan was executed in October 2007 between the Company
and Profit Consultants in the amount of $75,000.
  In June
2008, we issued 300,000 shares of our common stock for acquisition of a Patent
application from Mr. Philip Azimov
  GLOBAL
CLEAN ENERGY is authorized to issue 300,000,000 shares of $.001 par value common
stock.  We have 25,378,721 shares of our common stock issued and
outstanding at December 31, 2008.  Dividends may be paid on the
outstanding shares as declared by our board of directors.  Each share
of common stock is entitled to one vote.
  Preferred
Stock
  GLOBAL
CLEAN ENERGY is authorized to issue 15,000,000 shares of $.001 par value
preferred stock.  No shares of preferred stock have been issued or are
outstanding.  Dividends, voting rights and other terms, rights and
preferences of the preferred shares have not been designated but may be
designated by our board of directors from time to time.
  Employee
Stock Compensation Plans
  GLOBAL
CLEAN ENERGY has adopted the 2007 Employee Stock Compensation Plan (the “ESC
Plan”) and the 2007 Stock Option Plan (the “STOCK Plan”) for its employees,
officers, directors and consultants.  We have reserved a maximum of
5,000,000 shares of common stock to be issued under the ESC Plan and 5,000,000
shares of common stock to be issued upon exercise of options granted under the
STOCK Plan.  No options are outstanding at December 31,
2008.
  Note 6 - Income
Taxes
  GLOBAL
CLEAN ENERGY recognizes deferred income tax liabilities and assets for the
expected future tax consequences of events that have been recognized in the
financial statements or tax returns.  Under this method, deferred tax
liabilities and assets are determined based on the differences between the
financial statement carrying amounts and the tax basis of assets and liabilities
using enacted tax rates in effect in the years in which the differences are
expected to reverse.
  GLOBAL
CLEAN ENERGY incurred no income taxes for the years ended December 31, 2008 and
2007.
  Net
operating loss carry forwards may be limited under the Change of Control
provisions of the Internal Revenue Code section 382.
  Note 7 - Commitments and
Related Party Transactions
 
 On August
1, 2008, Vision Capital Partners AA Ltd. loaned to the Company the amount of
$80,000, which accrues interest at 7.5% per annum due in one year.
Dr. Azimov, Chairman of the Company’s Board, and Mr. Adessky, the
Company’s CFO, Secretary and a Director, each owns 50% of Vision Capital and is
an officer and director of Vision Capital.
  F-9
  In March
2008, we issued 107,500 shares of our common stock for the conversion of an
unsecured loan which was executed in March 2007 between the Company and Vision
Capital Partners in the amount of $100,000. Dr. Azimov, Chairman of the
Company’s Board, and Mr. Adessky, the Company’s CFO, Secretary and a
Director, each owns 50% of Vision Capital and is an officer and director of
Vision Capital.
  During
2008, we paid legal fees totaling $21,426 to a law firm of which Mr. Adessky,
our CFO, Secretary and a Director is a partner.
  Note 8 - Subsequent
Event
  None
  F-10