UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





x
            REPORT
      UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934


For the
quarterly period ended March 31,
2010





 ̈
            REPORT
      UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT


For the
transition period from _____________________ to ______________





File No.
333-127813





Majestic
Oil & Gas, Inc.


(Name of
small business issuer in our charter)





Nevada
            4600
            20-1673271(State or other jurisdiction of
              incorporation or organization)
            (Primary Standard Industrial
              Classification Code
              Number)
            (I.R.S. Employer
              Identification Number)





P.O
      Box 488 Cut Bank, Montana
            59427(Address
      of principal executive
              offices)
            (Zip
      Code)





Registrant’s
telephone 406-873-5580





Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.


Yes x
No  ̈





Indicate
by check mark whether the registrant is a 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.




Large
      accelerated filer
             ̈
            Accelerated
      filer
             ̈Non-accelerated
      filer
             ̈
            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  ̈No
x





As of May
12, 2010, there were 8,918,000 shares issued and outstanding of the registrant’s
common stock.







INDEX




PART
      I — FINANCIAL INFORMATION
              3Item
      1. Financial Statements
              3Item
      2. Management’s Discussion and Analysis or Plan of
    Operation.
              11Item
      3. Quantitative and Qualitative Disclosure about Market
    Risk
              16Item
      4. Controls and Procedures.
              16PART
      II — OTHER INFORMATION
              17Item
      1. Legal Proceedings.
              17Item
      1A. Risk Factors
              17Item
      2. Unregistered Sales of Equity Securities and Use of
      Proceeds.
              17Item
      3. Defaults Upon Senior Securities.
              17Item
      4. (Removed and Reserved)
              17Item
      5. Other Information.
              17Item
      6. Exhibits.
              18




2




PART
I — FINANCIAL INFORMATION




Item
1. Financial Statements


3





MAJESTIC
OIL & GAS, INC. (A Development Stage Company)


CONDENSED
CONSOLIDATED BALANCE SHEETS





March 31,2010
                      
                      
                      December 31UNAUDITED
                      
                      
                      2009ASSETSCash
      and cash equivalents
                      
                      $
                      94,212
                      
                      
                      $
                      110,701Trade
      receivables
                      
                      
                      6,821
                      
                      
                      
                      5,823Deposit
                      
                      
                      -
                      
                      
                      
                      -Total
      Current Assets
                      
                      
                      101,033
                      
                      
                      
                      116,524OIL
      AND GAS PROPERTIESOil
      and gas properties, using the full cost method of
    accounting:Properties
      being amortized
                      
                      
                      455,894
                      
                      
                      
                      455,894Properties
      not subject to amortization
                      
                      
                      203,278
                      
                      
                      
                      202,531Less
      accumulated depletion, amortization and impairment
                      
                      
                      (170,500
                      )
                      
                      
                      (164,000
                      )Net
      Oil and Gas Properties
                      
                      
                      488,672
                      
                      
                      
                      494,425OTHER
      ASSETSWebsite
      development costs (less accumulated amortization)
                      
                      
                      190
                      
                      
                      
                      400Total
      Other Assets
                      
                      
                      190
                      
                      
                      
                      400Total
      Assets
                      
                      $
                      589,895
                      
                      
                      $
                      611,349LIABILITIES
      AND STOCKHOLDERS' EQUITYLIABILITIESAccounts
      payable and accrued liabilities
                      
                      $
                      2,839
                      
                      
                      $
                      5,028Production
      taxes and royalties payable
                      
                      
                      1,620
                      
                      
                      
                      1,379Well
      settlement payable
                      
                      
                      22,959
                      
                      
                      
                      22,959Total
      Current Liabilities
                      
                      
                      27,418
                      
                      
                      
                      29,366Asset
      retirement obligation
                      
                      
                      8,879
                      
                      
                      
                      8,879Total
      Liabilities
                      
                      
                      36,297
                      
                      
                      
                      38,245STOCKHOLDERS'
      EQUITYCommon
      stock, no par value-Authorized
      Shares - 100,000,000Issued
      & Outstanding:  8,918,000 shares at March 31,
      2010;8,918,000
      at December 31, 2009
                      
                      
                      1,272,500
                      
                      
                      
                      1,272,500Additional
      paid in capital
                      
                      
                      19,295
                      
                      
                      
                      19,295(Deficit)
      accumulated during the development stage
                      
                      
                      (738,197
                      )
                      
                      
                      (718,691
                      )Total
      Stockholders' Equity
                      
                      
                      553,598
                      
                      
                      
                      573,104Total
      Liabilities & Stockholders' Equity
                      
                      $
                      589,895
                      
                      
                      $
                      611,349




4





MAJESTIC
OIL & GAS, INC. (A Development Stage Company)


CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS





Three Months
                
                
                Three Months
                
                
                InceptionEnded
                
                
                Ended
                
                
                (April 16, 2002)March 31,
                
                
                March 31,
                
                
                March 31,2010
                
                
                2009
                
                
                2010UNAUDITED
                
                
                UNAUDITED
                
                
                UNAUDITEDREVENUE
                
                $
                6,821
                
                
                $
                12,498
                
                
                $
                462,498PRODUCTION
      (LIFTING) COSTS
                
                
                5,334
                
                
                
                5,458
                
                
                
                145,297EXPLORATION
      EXPENSES
                
                
                -
                
                
                
                -
                
                
                
                3,862DEPLETION,
      DEPRECIATION AND AMORTIZATION
                
                
                6,710
                
                
                
                13,010
                
                
                
                172,810INCOME
      FROM OIL & GAS PRODUCING ACTIVITIES
                
                
                (5,223
                )
                
                
                (5,970
                )
                
                
                140,529SELLING,
      GENERAL & ADMINISTRATIVE EXPENSES
                
                
                14,283
                
                
                
                20,422
                
                
                
                878,726NET
      (LOSS)
                
                $
                (19,506
                )
                
                $
                (26,392
                )
                
                $
                (738,197
                )EARNINGS
      PER SHARENet
      Income, basic and diluted
                
                $
                (0.00
                )
                
                $
                (0.00
                )Weighted
      average number of shares outstanding
                
                
                8,918,000
                
                
                
                7,808,000Diluted
      potential shares - stock warrants
                
                
                -
                
                
                
                -Adjusted
      weighted average shares
                
                
                8,918,000
                
                
                
                7,808,000




5




MAJESTIC
OIL & GAS, INC. (A Development Stage Company)


CONDENSED
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY





(Deficit)AccumulatedAdditional
                                            
                                            
                                            Stock
                                            
                                            
                                            DuringCommon Stock
                                            
                                            
                                            Paid In
                                            
                                            
                                            Subscription
                                            
                                            
                                            DevelopmentShares
                                            
                                            
                                            Amount
                                            
                                            
                                            Capital
                                            
                                            
                                            Receivable
                                            
                                            
                                            Stage
                                            
                                            
                                            TotalBEGINNING
      BALANCE, INCEPTION (APRIL 16, 2002) TO DECEMBER 31, 2004
                                            
                                            
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -Common
      stock issued
                                            
                                            
                                            6,240,000
                                            
                                            
                                            
                                            624,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            624,000Net
      (loss)
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (346,422
                                            )
                                            
                                            
                                            (346,422
                                            )BALANCE,
      DECEMBER 31, 2004
                                            
                                            
                                            6,240,000
                                            
                                            
                                            
                                            624,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (346,422
                                            )
                                            
                                            
                                            277,578Common
      stock issued
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -Net
      income
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            66,381
                                            
                                            
                                            
                                            66,381BALANCE,
      DECEMBER 31, 2005
                                            
                                            
                                            6,240,000
                                            
                                            
                                            
                                            624,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (280,041
                                            )
                                            
                                            
                                            343,959Common
      stock issued
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -Net
      (loss)
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (20,068
                                            )
                                            
                                            
                                            (20,068
                                            )BALANCE,
      DECEMBER 31, 2006
                                            
                                            
                                            6,240,000
                                            
                                            
                                            
                                            624,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (300,109
                                            )
                                            
                                            
                                            323,891Common
      stock issued for services
                                            
                                            
                                            330,000
                                            
                                            
                                            
                                            147,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            147,000Common
      stock warrants exercised
                                            
                                            
                                            938,000
                                            
                                            
                                            
                                            234,500
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            234,500Common
      stock options issued
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            19,295
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            19,295Net
      (loss)
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (255,025
                                            )
                                            
                                            
                                            (255,025
                                            )BALANCE,
      DECEMBER 31, 2007
                                            
                                            
                                            7,508,000
                                            
                                            
                                            
                                            1,005,500
                                            
                                            
                                            
                                            19,295
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (555,134
                                            )
                                            
                                            
                                            469,661Common
      stock issued
                                            
                                            
                                            300,000
                                            
                                            
                                            
                                            150,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            150,000Net
      (loss)
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (68,680
                                            )
                                            
                                            
                                            (68,680
                                            )BALANCE,
      DECEMBER 31, 2008
                                            
                                            
                                            7,808,000
                                            
                                            
                                            
                                            1,155,500
                                            
                                            
                                            
                                            19,295
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (623,814
                                            )
                                            
                                            
                                            550,981Common
      stock issued for services
                                            
                                            
                                            100,000
                                            
                                            
                                            
                                            16,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            16,000Common
      stock issued
                                            
                                            
                                            1,010,000
                                            
                                            
                                            
                                            101,000
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            101,000Net
      (loss)
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            
                                            (94,877
                                            )
                                            
                                            
                                            (94,877
                                            )BALANCE,
      DECEMBER 31, 2009
                                            
                                            
                                            8,918,000
                                            
                                            
                                            
                                            1,272,500
                                            
                                            
                                            
                                            19,295
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (718,691
                                            )
                                            
                                            
                                            573,104Net
      (loss) for the three months
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (19,506
                                            )
                                            
                                            
                                            (19,506
                                            )BALANCE,
      March 31, 2010
                                            
                                            
                                            8,918,000
                                            
                                            
                                            $
                                            1,272,500
                                            
                                            
                                            $
                                            19,295
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            (738,197
                                            )
                                            
                                            $
                                            553,598




6




MAJESTIC
OIL & GAS, INC. (A Development Stage Company)


CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS





InceptionThree Months
                
                
                Three Months
                
                
                (April 16, 2002)Ended
                
                
                Ended
                
                
                ThroughMarch 31, 2010
                
                
                March 31, 2009
                
                
                March 31, 2010UNAUDITED
                
                
                UNAUDITED
                
                
                UNAUDITEDOPERATING
      ACTIVITIESNet
      (loss)
                
                $
                (19,506
                )
                
                $
                (26,392
                )
                
                $
                (738,197
                )Changes
      and credits to net (loss) not affecting cash
                
                
                
                
                
                
                -Depletion
      and amortization
                
                
                6,710
                
                
                
                13,010
                
                
                
                172,810Organizational
      expenses paid with stock
                
                
                -
                
                
                
                -
                
                
                
                300,000Legal
      fees paid with stock
                
                
                -
                
                
                
                -
                
                
                
                188,000Stock
      compensation expense
                
                
                -
                
                
                
                -
                
                
                
                21,295Changes
      in assets and liabilitiesTrade
      receivables
                
                
                (998
                )
                
                
                11,572
                
                
                
                (6,821
                )Deposits
                
                
                -
                
                
                
                -
                
                
                
                -Production
      taxes and royalties payable
                
                
                241
                
                
                
                (1,945
                )
                
                
                1,620Accounts
      payable
                
                
                (2,189
                )
                
                
                (2
                )
                
                
                25,798NET CASH FROM (USED FOR)
      OPERATING
      ACTIVITIES
                
                
                (15,742
                )
                
                
                (3,756
                )
                
                
                (35,495
                )INVESTING
      ACTIVITIESWebsite
      development
                
                
                -
                
                
                
                -
                
                
                
                (2,500
                )Additions
      to oil and gas properties
                
                
                (747
                )
                
                
                (6,002
                )
                
                
                (490,293
                )NET CASH (USED FOR)
      INVESTING ACTIVITIES
                
                
                (747
                )
                
                
                (6,002
                )
                
                
                (492,793
                )FINANCING
      ACTIVITIESProceeds
      from sale of common stock
                
                
                -
                
                
                
                -
                
                
                
                251,000Proceeds
      from exercise of warrants
                
                
                -
                
                
                
                -
                
                
                
                371,500NET CASH PROVIDED BY
      FINANCING ACTIVITIES
                
                
                -
                
                
                
                -
                
                
                
                622,500NET CHANGE IN CASH AND
      CASH EQUIVALENTS
                
                
                (16,489
                )
                
                
                (9,758
                )
                
                
                94,212CASH AND CASH EQUIVALENTS
      AT BEGINNING OF
      PERIOD
                
                
                110,701
                
                
                
                79,790
                
                
                
                -CASH AND CASH EQUIVALENTS
      AT END OF
      PERIOD
                
                $
                94,212
                
                
                $
                70,032
                
                
                $
                94,212




7





MAJESTIC
OIL & GAS, INC. (A Development Stage Company)


NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS





Note 1 -
Business Activity and Basis of Presentation





Principal
Business Activity


Majestic
Oil & Gas, Inc. (Company) is a development stage enterprise and its
operations consist of oil and natural gas development and production in the
Rocky Mountain region. The financial statements and notes to the financial
statements are the representation of the Company's management, who is
responsible for their integrity and objectivity. The accounting policies of the
Company are in accordance with generally accepted accounting principles and
conform to the standards applicable to development stage
enterprises.





Basis
of Presentation


The
accompanying interim financial statements of the Company are unaudited. In the
opinion of management, the interim data includes all adjustments, consisting
only of normal recurring adjustments necessary for a fair presentation of the
results for the interim period. The results of operations for the three months
ended March 31, 2010 are not necessarily indicative of the operating results for
the entire year.





We have
prepared the financial statements included herein pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations. We believe the disclosures made
are adequate to make the information not misleading and recommend that these
condensed financial statements be read in conjunction with the financial
statements and notes included in our Form 10-K for the year ended December 31,
2009.





Note 2 -
Basis of Accounting





The
accompanying financial statements have been prepared using accounting principles
applicable to a going concern, which contemplates the realization of assets and
extinguishment of liabilities in the normal course of business. As shown in the
accompanying condensed balance sheet the Company has an accumulated deficit of
($738,197) through March 31, 2010. This and other factors may indicate that the
Company may be unable to continue in existence. The Company's financial
statements do not include any adjustments related to the realization of the
carrying value of assets or the amounts and classification of liabilities that
might be considered necessary should the Company be unable to continue in
existence. The Company's ability to establish itself as a going concern is
dependent upon its ability to obtain additional financing in order to fund
exploration and development activities of oil and gas interests and, ultimately,
to achieve profitable operations. Management believes that it can be successful
in obtaining either debt or equity financing that will enable the Company to
continue in existence and establish itself as a going concern.





These
interim financial statements are prepared using the significant accounting
policies disclosed in the Company's December 31, 2009 annual audited financial
statements, except that certain significant accounting policies were adopted
during the three months ended March 31, 2010:





Adopted
prior to the three months ended March 31, 2010 -


Oil
and Gas Interests




The
Company utilizes the full cost method of accounting for oil and gas activities.
Under this method, subject to a limitation based on estimated value, all costs
associated with property acquisition, exploration and development, including
costs of unsuccessful exploration, are capitalized within a cost center. No gain
or loss is recognized upon the sale or abandonment of undeveloped or producing
oil and gas interests unless the sale represents a significant portion of oil
and gas interests and the gain significantly alters the relationship between
capitalized costs and proved oil and gas reserves of the cost center.
Depreciation, depletion and amortization of oil and gas interests is computed on
the units of production method based on proved reserves, or upon reasonable
estimates where proved reserves have not yet been established due to the recent
commencement of production. Amortizable costs include estimates of future
development costs of proved undeveloped reserves.


8





MAJESTIC
OIL & GAS, INC. (A Development Stage Company)


NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS





Capitalized
costs of oil and gas interests may not exceed an amount equal to the present
value, discounted at 10%, of the estimated future net cash flows from proved
reserves plus the cost, or estimated fair market value if lower, of unproved
interests. Should capitalized costs exceed this ceiling, an impairment is
recognized. The present value of estimated future net cash flows is computed by
applying year end prices of oil and gas to estimated future production of proved
oil and gas reserves as of year end, less estimated future expenditures to be
incurred in developing and producing the proved reserves and assuming
continuation of existing economic conditions.





Revenue
Recognition


The
Company recognizes oil and gas revenues from its interests in producing wells as
oil and gas is produced and sold from the wells and when ultimate collection is
reasonably assured.





Website
Development Costs


The
Company has capitalized the costs associated with development of its website,
and is amortizing the cost over a three year period.





Stock
Based Compensation


The
Company accounts for stock based compensation in accordance with current
accounting standards which specify the revised accounting alternative
requirements for pre-2006 stock based compensation grants existing at
January 1, 2006 and the required accounting for new grants starting
January 1, 2006. The Company had no stock based compensation grants made
before year 2007.





Accordingly,
the provisions pertaining to pre-2006 grants do not apply. The Company values
its stock options awarded on or after January 1, 2006 at the fair value at
grant date using the Black-Scholes option pricing model. Compensation expense
for stock options is recorded over the vesting period on a straight line basis.
Compensation paid in vested stock is valued at the fair value at the applicable
measurement date and charged to expense at that date.





Income
Taxes




Effective
January 1, 2007, the Company adopted the provisions current accounting standards
related to accounting for uncertainty in income taxes. These standards provide
detailed guidance for the financial statement recognition, measurement and
disclosure of uncertain tax positions recognized in the financial statements.
Tax positions must meet a “more-likely-than-not” recognition threshold at the
effective date to be recognized upon the adoption of  the standards
and in subsequent periods. Upon the adoption of the standards, the Company had
no unrecognized tax benefits. During 2009 and during the first three months of
2010, the Company recognized no adjustments for uncertain tax
benefits.





Deferred
income tax assets, if any, are adjusted by a valuation allowance, if necessary,
to recognize future tax benefits only to the extent, based on available
evidence, it is more likely than not such benefits will be realized. The Company
would recognize interest and penalties, if any, related to uncertain tax
positions in general and administrative expenses. No interest and penalties
related to uncertain tax positions were accrued at March 31, 2010. The Company
expects no material changes to unrecognized tax positions within the next twelve
months.





Earnings
per Share of Common Stock




Basic
earnings per share is determined in accordance with current accounting standards
using net income divided by the weighted average shares outstanding during the
period.  Diluted earnings per share is computed by dividing net income
by the weighted average shares outstanding, assuming all dilutive potential
common shares were issued.  The effect of outstanding common stock
warrants was anti-dilutive for the three months ended March 31, 2010 and
2009.





Fair
Value Measurement




Effective
January 1, 2008, the Company adopted accounting standards related to measurement
of fair value in its financial statements. These standards provide a framework
for measuring fair value under generally accepted accounting
principles.   These standards would apply to all financial
instruments that are being measured and reported on a fair value basis.
Currently, the Company has no financial instruments to which this statement
would apply.


9





MAJESTIC
OIL & GAS, INC. (A Development Stage Company)


NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS





Recent
Accounting Pronouncements





In June
2009, accounting standards were issued related to the FASB's codification of accounting
standards and the hierarchy of generally accepted accounting principles.
The objective of these standards was to become the source of authoritative U.S.
generally accepted accounting principles to be applied by nongovernmental
entities. The standards became effective for financial statement issued for
interim and annual periods ending after September 15, 2009. Management has
adopted these standards.





In May
2009, accounting standards were issued related to events occuring subsequent to
the balance sheet date, but prior to issuance of the financial statements. The
objective of these standards is to establish general standards of accounting for
and disclosure of events that occur after the balance sheet date but before the
financial statements are issued or available to be issued. Management has
adopted these standards.





In
December 2008 the SEC unanimously approved amendments to revise its oil and gas
reserves estimation and disclosure requirements. The amendments, among other
things, allows the use of new technologies to determine proved reserves; permits
the optional disclosure of probable and possible reserves; modifies the prices
used to estimate reserves for SEC disclosure purposes to a 12-month average
instead of a period end price; and requires that if a third party is primarily
responsible for preparing or auditing reserve estimates, the Company make
disclosures relating to the independence and qualifications of the third party,
including filing as an exhibit any report received from the third party. The
revised rules are effective January 1, 2010. The new requirements do not have an
impact on the Company’s 2009 financial statements.





Note 3 -
Organization and Development of the Company





The
Company was formed on April 16, 2002 as a corporation. The Company is considered
a development stage enterprise. The accompanying interim financial statements
reflect limited oil and gas development and production activities and they are
not necessarily indicative of what the financial statements will reflect once
the intended operations of the Company are fully underway.





Note 4 -
Asset Retirement Obligations





The
Company follows current accounting standards in accounting for its asset
retirement obligations. These standards address financial accounting and
reporting for obligations associated with the retirement of tangible long-lived
assets and the associated asset retirement costs. These accounting standards
require recognition of the present value of obligations associated with the
retirement of tangible long-lived assets in the period in which it is incurred.
As of March 31, 2010, the estimated future cost to plug and abandon the
Company's gas wells was estimated to be $8,879. The estimated liability is based
on historical experience in plugging and abandoning wells, estimated cost to
plug and abandon wells in the future and federal and state regulatory
requirements.





Note 5 -
Related Party Transactions





Altamont
Oil & Gas, Inc. (Altamont), an entity related through common ownership and
management, is the operator of the wells in which the Company owns its working
interests. As the operator of the wells, Altamont is responsible for remitting
production taxes to the taxing authorities and royalty payments to the royalty
interest owners. As of March 31, 2010, the Company had an outstanding receivable
from Altamont of $6,821 for gas sales, and a payable to Altamont of $1,620 for
production taxes and royalties. The Company also received an Authorization for
Expenditure (AFE) for its share of costs associated with the Jody Fields #4-1
well, which remains under development as of March 31, 2010. The Company paid
$5,547 to Altamont for development costs, and has a payable to Altamont of
$22,959 for its remaining share of the AFE.





Note 6 -
Farm Out Agreement





During
2007, the Company entered into a Farm-out Agreement with Altamont Oil & Gas,
Inc and Numbers, Inc., an entity related through common ownership and
management, to conduct a 10-well natural gas development
program.  This development program is still pending and will involve
the drilling of 5 wells in the Lake Frances Gas Field and 5 wells in the
Williams Gas Field, located in Pondera County, Montana.   The
Lake Frances Field is located south of Valier, Montana just offsetting the Lake
Frances reservoir.  The Williams Field is located 7 miles east of the
town of Valier, Montana.


10




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




FORWARD LOOKING
STATEMENTS





The
following discussion and analysis is provided to increase the understanding of,
and should be read in conjunction with, the Financial Statements of the Company
and Notes thereto included elsewhere in this Report. Historical results and
percentage relationships among any amounts in these financial statements are not
necessarily indicative of trends in operating results for any future period. The
statements, which are not historical facts contained in this Report, including
this Plan of Operations, and Notes to the Financial Statements, constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements are based on currently available
operating, financial and competitive information, and are subject to various
risks and uncertainties. Future events and the Company's actual results may
differ materially from the results reflected in these forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, dependence on existing and future key strategic and strategic
end-user customers, limited ability to establish new strategic relationships,
ability to sustain and manage growth, variability of operating results, the
Company's expansion and development of new service lines, marketing and other
business development initiatives, the commencement of new engagements,
competition in the industry, general economic conditions, dependence on key
personnel, the ability to attract, hire and retain personnel who possess the
technical skills and experience necessary to meet the service requirements of
its clients, the potential liability with respect to actions taken by its
existing and past employees, risks associated with international sales, and
other risks described herein and in the Company's other SEC
filings.





The safe
harbors of forward-looking statements provided by Section 21E of the Exchange
Act are unavailable to issuers of penny stock. As we issued securities at a
price below $5.00 per share, our shares are considered penny stock and such safe
harbors set forth under the Reform Act are unavailable to us.





The
following discussion of our financial condition and results of operations should
be read in conjunction with the Financial Statements and Notes to the Condensed
Consolidated Financial Statements appearing elsewhere in this
report.





OVERVIEW





Majestic
Oil & Gas, Inc. is engaged in the exploration, development, acquisition and
operation of oil and natural gas properties. Because oil and natural gas
exploration and development requires significant capital and because our assets
and resources are limited, we participate in the gas industry through the
purchase of interests in either producing wells or oil and natural gas
exploration, development and production projects.





Majestic
Oil & Gas, Inc. is a development stage company, and as such it is difficult
for us to forecast our revenues or earnings accurately. We believe that
period-to-period comparisons of our operating results may not be meaningful and
should not be relied upon as an indication of future performance as we have and
will have no backlog of orders. Our operating results in one or more future
quarters may fall below investor expectations which, assuming our common stock
trades on a recognized market, would almost certainly cause the future trading
price of our common stock to decline. You should read the following discussion
together with the condensed consolidated financial statements and their
accompanying notes, included elsewhere in the report.


11





Majestic
Oil & Gas, Inc. participated in drilling programs in the Lake Frances Field
during 2007 and 2008.  Four successful gas wells have been drilled
to-date; the B Ag #25-1, Vandenbos #19-1, Boucher #18-1 and Stoltz
#18-1.  Majestic Oil & Gas, Inc. holds a 25% Working Interest in
these four wells and the Company expects to see an increase in production
volumes, as a result of these wells. In addition, Majestic Oil & Gas, Inc.
participated in the drilling of the Vandenbos #19-2 and the Jody Fields #4-1.
The Vandenbos #19-2 well was subsequently plugged and abandoned, as was the Jody
Fields #4-1 well, which was a wildcat oil well.





Majestic
Oil & Gas, Inc. entered into a farm-out agreement with Mountain View Energy,
Inc. on September 1, 2009, outlining parameters for Mountain View Energy, Inc.
to drill a test well in the NWSE-Section 33-T27N-R4W, Teton County, MT at its
sole cost, risk and expense.    In doing so, Mountain View
Energy, Inc., would acquire 75% of the Working Interest, while Majestic Oil
& Gas, Inc. would retain a 25% Working Interest in any well drilled in the
40-acre tract.





Accordingly,
on September 9, 2009, drilling commenced drilling on the Donovan #33-3 well
located in the West Pondera Field, SWNWSE – Section 33-T27N-R4W, Teton County,
Montana.  The well was successfully drilled and completed with an
initial production of 15 barrels of oil per day with no
water.   The producing interval is the Madison/Sun River Dolomite
with 20 feet of pay from 2,125’ to 2,145’.





Due to
the success of the Donovan #33-3, a second oil well was drilled in the West
Pondera Field.  The Donovan #33-2 is located in the SENWSE - Section
33-T27N-R4W, Teton County, Montana.  This oil well was successfully
drilled and completed with initial production of 2 to 4 barrels of oil per
day.





Majestic
Oil & Gas, Inc. entered into a farm-out agreement with Altamont Oil &
Gas, Inc., and subsequently with Hartford Energy, Inc., to conduct the re-entry
of the Fields #14-34.  As per the farm-out agreement with Hartford
Energy, Inc., the Company retained a 25% Working Interest in this
well.  The Fields #14-34 is located in the Loneman Coulee Field,
Pondera County, Montana and was completed as a Madison/Sun River oil well with
initial production of 5 barrels of oil per day.





Based
upon our Management's experience in the oil and natural gas industry and on
recent events, including increasing global demand for energy and energy
disruptions caused by natural disasters, we believe the trend in oil and gas
prices will remain relatively stable or decrease slightly, but over the
long-term are more likely to increase. We expect to generate positive net income
from operations in the future, although our revenue and expenses will increase
as we expand our drilling and ownership activities. However, the current
economic crisis could have a negative impact on the Company’s revenues due to
the recent decrease in oil and natural gas prices.   During the
course of 2009, Majestic Oil & Gas, Inc. saw a significant decrease in the
price received per MCF at a high of $3.09 and a low of $1.19, as detailed under
“Results of Operation.”  To-date in 2010, the Company received a high
of $2.80 per MCF and a low of $2.26 per MCF.  The current trend shows
a continued decline in pricing.  The price we receive for our
production directly affects the amount of revenues we generate, which in turn
affects the Company’s liquidity and overall financial position.


12


RESULTS OF
OPERATIONS





Three Months Ended March 31,
2010 vs. Three Months Ended March 31, 2009:





Three Months
                  Ended
                  March 31, 2010
                
                
                Three Months
                  Ended
                  March 31, 2009Revenue
                
                $
                6,821
                
                
                $
                12,498Expenses
                
                $
                26,327
                
                
                $
                38,890Net
      Income (Loss)
                
                $
                (19,506)
                
                
                $
                (26,392)





Revenues
for the period ended March 31, 2010 were $6,821 compared to $ 12,498 for the
period ended March 31, 2009. There was a significant decrease in the revenues
between these two periods as a result of the decrease in natural gas production
and the price received per MCF.




Ludwig State 36-1
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF
                  
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF2010
                  
                  
                  2009January
                  
                  
                  175.93
                  
                  
                  
                  2.35
                  
                  
                  
                  231.21
                  
                  
                  3.09February
                  
                  
                  192.02
                  
                  
                  
                  2.26
                  
                  
                  
                  211.20
                  
                  
                  2.34March
                  
                  
                  175.93
                  
                  
                  
                  2.80
                  
                  
                  
                  218.83
                  
                  
                  1.80




Boucher
      27-1
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF
                  
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF2010
                  
                  
                  2009January
                  
                  
                  47.64
                  
                  
                  
                  2.35
                  
                  
                  
                  110.14
                  
                  
                  3.09February
                  
                  
                  47.64
                  
                  
                  
                  2.26
                  
                  
                  
                  71.16
                  
                  
                  2.34March
                  
                  
                  43.11
                  
                  
                  
                  2.80
                  
                  
                  
                  56.72
                  
                  
                  1.80





B. Ag #25-1
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF
                  
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF2010
                  
                  
                  2009January
                  
                  
                  33.80
                  
                  
                  
                  2.35
                  
                  
                  
                  38.80
                  
                  
                  3.09February
                  
                  
                  31.00
                  
                  
                  
                  2.26
                  
                  
                  
                  33.80
                  
                  
                  2.34March
                  
                  
                  32.80
                  
                  
                  
                  2.80
                  
                  
                  
                  36.80
                  
                  
                  1.80




Vandenbos #19-1
                      
                      Share of
                        Production
                        Volumes
                      
                      
                      Price
                        Per
                        MCF
                      
                      
                      Share of
                        Production
                        Volumes
                      
                      
                      Price
                        Per
                        MCF2010
                      
                      
                      2009January
                      
                      
                      361.56
                      
                      
                      
                      2.35
                      
                      
                      
                      708.06
                      
                      
                      3.09February
                      
                      
                      352.48
                      
                      
                      
                      2.26
                      
                      
                      
                      632.57
                      
                      
                      2.34March
                      
                      
                      305.66
                      
                      
                      
                      2.80
                      
                      
                      
                      683.72
                      
                      
                      1.80




13





Boucher #18-1
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF
                  
                  
                  Share of
                    Production
                    Volumes
                  
                  Price
                    Per
                    MCF2010
                  
                  
                  2009January
                  
                  
                  211.00
                  
                  
                  
                  2.35
                  
                  
                  
                  413.33
                  
                  3.09February
                  
                  
                  212.25
                  
                  
                  
                  2.26
                  
                  
                  
                  356.40
                  
                  2.34March
                  
                  
                  168.00
                  
                  
                  
                  2.80
                  
                  
                  
                  365.48
                  
                  1.80





Stoltz #18-1
                  
                  Share of
                    Production
                    Volumes
                  
                  
                  Price
                    Per
                    MCF
                  
                  
                  Share of
                    Production
                    Volumes
                  
                  Price
                    Per
                    MCF2010
                  
                  
                  2009January
                  
                  
                  1
                  
                  
                  
                  2.35
                  
                  
                  
                  27.83
                  
                  3.09February
                  
                  
                  2
                  
                  
                  
                  2.26
                  
                  
                  
                  19.50
                  
                  2.34March
                  
                  
                  3
                  
                  
                  
                  2.80
                  
                  
                  
                  13.41
                  
                  1.80





Majestic
Oil & Gas Operations, Inc’s Net Share of the production volumes from the
Ludwig State #36-1, Boucher #27-1, B. Ag #25-1, Vandenbos #19-1, Boucher #18-1
and Stoltz #18-1 wells for the three month period ended March 31, 2010 were
2,392 MCF compared to 4,229 MCF for the three month period ended March 31, 2009.
The production decrease is a result of natural decline in production over
time.





Our total
expenses decreased by $12,563 from the $38,890 reported for the three months
ended March 31, 2009 compared to the $26,327 reported for the three months ended
March 31, 2010. Of those expenses, Production (Lifting) Costs decreased by $124
from $5,458 for the three months ended March 31, 2009 to $5,334 for the three
months ended March 31, 2010. This decrease is directly attributable to the
decrease in production volumes between the two periods. There was a decrease in
the Selling, General & Administrative Expenses of $6,139 from the $20,422
reported for the three month period ended March 31, 2009 compared to the $14,283
reported for the same three month period in 2010. The primary reason for the
decrease was a decrease of approximately $6,800 in engineering and professional
fees incurred. As mentioned above, revenues for the three month period decreased
significantly as a result of the combination of lower production volumes and the
price per MCF.





The
Company showed a Net Loss of ($19,506) for the three months ended March 31,
2010. This compares to the Net Loss of ($26,392) for the three months ended
March 31, 2009. The variance between these three month periods is directly
related to the decrease in revenues and volumes during the First Quarter 2010.
While it is the Company’s hope that production volumes increase as a result of
its planned development and drilling program, the Company’s revenues are subject
to the volatility of natural gas prices, which continue to fluctuate
dramatically.





The
Company also plans to continue its pursuit of oil prospects in the Lake Frances
Area, which if successful, could contribute to an increase in future
revenues.  The price of crude oil also continues to fluctuate but not
to the same extreme as the price of natural gas.  In spite of the
fluctuations in the price of oil and natural gas, Management is still confident
that we will build the Company through continued drilling of oil and natural gas
prospects.


14


Drilling
Activity





The
following table sets forth the results of our drilling activities during the
three months ended March 31, 2010 and 2009:





Drilling ActivityThree Months ended
                
                Gross Wells
                
                
                Net WellsMarch 31,
                
                Total
                
                
                Producing
                
                
                Dry
                
                
                Total
                
                
                Producing
                
                
                Dry2010
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                02009
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0
                
                
                
                0





Net
Production, Average Sales Price and Average Production Costs
(Lifting)




The table
below sets forth the net quantities of oil and gas production (net of all
royalties, overriding royalties and production due to others) attributable to
the Company for the three month periods ended March 31, 2010 and 2009, and the
average sales price, and average production costs (including depreciation,
depletion and amortization, lease operating costs and all associated taxes) on a
per unit of production basis:





Three Months ended March 31,
                
                2010
                
                
                2009Net
      ProductionOil
      (Bbls)Gas
      (Mcf)
                
                
                2,392
                
                
                
                4,229Average
      Sales PricesOil
      (per Bbl)
                
                $
                
                
                
                $Gas
      (per Mcf)
                
                $
                2.46
                
                
                $
                2.41Average
      Production Cost Per MCF
                
                $
                5.04
                
                
                $
                4.37





LIQUIDITY AND RESOURCE
CAPITAL





We are
still a development stage company. From our inception to March 31, 2010, we
incurred an accumulated deficit of ($738,197). This deficit is primarily the
result of approximately $300,000 in expenses associated with stock issuances
during fiscal Year Ended December 31, 2002, and $322,000 in legal, accounting
and filing fees incurred since inception associated with being a publicly traded
company. As of March 31, 2010, we had $94,212 of current cash available. Our
cash resources of $94,212 are not sufficient to satisfy our cash requirements
over the next 12 months.





We need
an additional minimum of $1,000,000 to finance our planned expansion in the next
12 months, which funds will be used for drilling of development oil and natural
gas wells in the Lake Frances and Williams Fields. We hope to be able to raise
additional funds from an offering of our stock in the future. However, this
offering may not occur, or if it occurs, may not raise the required funding. We
may also consider securing debt financing. We may not raise other equity or debt
financing sufficient to fund this amount. If we don't raise or generate these
funds, the implementation of our short-term business plan will be delayed or
eliminated.


15





Our
ability to continue as a going concern is dependent on our ability to raise
funds to implement our planned development; however we may not be able to raise
sufficient funds to do so. Our independent auditors have indicated that there is
substantial doubt about our ability to continue as a going concern over the next
twelve months. Our poor financial condition could inhibit our ability to achieve
our business plan.





COMMITMENTS AND
CONTINGENCIES





On July
1, 2004, the Company entered into an operating agreement with Altamont Oil &
Gas, Inc., through which Altamont Oil & Gas, Inc. will operate the wells in
which we have acquired a working interest. Our share of monthly operating costs
will be deducted from our monthly share of production revenue.





Beginning
in 2007, the Company has acquired leases covering approximately 3,963 net acres
of undeveloped land for the purpose of future oil and gas development. This
acreage is located in Pondera County, Montana in the vicinity of the Williams
and Lake Frances Gas Fields. These leases remain in good standing with the term
of the leases being for periods of 3 or 5 years. Management considers the value
of the properties to be as much or more than for what they were
acquired.





Majestic
Oil & Gas, Inc. entered into a farm-out agreement with Mountain View Energy,
Inc. on September 1, 2009, outlining parameters for Mountain View Energy, Inc.
to drill a test well in the NWSE-Section 33-T27N-R4W, Teton County, MT at its
sole cost, risk and expense.    In doing so, Mountain View
Energy, Inc. would acquire 75% of the Working Interest, while Majestic Oil &
Gas, Inc. would retain a 25% Working Interest in any well drilled in the 40-acre
tract.




Item
3. Quantitative and Qualitative Disclosure about Market Risk




Not
applicable




Item
4. Controls and Procedures.





Evaluation of Disclosure
Controls and Procedures





We
carried out an evaluation, under the supervision and with the participation of
our management, including our Principal Executive Officer/Principal Financial
Officer, of the effectiveness of our disclosure controls and procedures (as
defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act (defined below)).
Based upon that evaluation, our principal executive officer/principal financial
officer concluded that, as of the end of the period covered in this report, our
disclosure controls and procedures were effective to ensure that information
required to be disclosed in reports filed under the Securities Exchange Act of
1934, as amended (the "Exchange Act") is recorded, processed, summarized and
reported within the required time periods and is accumulated and communicated to
our management, including our Principal Executive Officer/Principal Financial
Officer, as appropriate to allow timely decisions regarding required
disclosure.


16





Our
management, including our Principal Executive Officer/Principal Financial
Officer, does not expect that our disclosure controls and procedures or our
internal controls will prevent all error or fraud.  A control system,
no matter how well conceived and   operated, can provide only
reasonable, not absolute, assurance that the objectives of the control system
are met. Further, the design of a control system must reflect the fact that
there are resource constraints and the benefits of controls must be considered
relative to their costs.  Due to the inherent limitations in all
control systems, no evaluation of controls can provide absolute assurance that
all control issues and instances of fraud, if any, have been detected.
Accordingly, management believes that the financial statements included in this
report fairly present in all material respects our financial condition, results
of operations and cash flows for the periods presented.





Changes in Internal Control
Over Financial Reporting





In
addition, our management with the participation of our Principal Executive
Officer/Principal Financial Officer have determined that no change in our
internal control over financial reporting occurred during or subsequent to the
quarter ended March 31, 2010 that has materially affected, or is (as that term
is defined in Rules 13(a)-15(f) and 15(d)-15(f) of the Securities Exchange Act
of 1934) reasonably likely to materially affect, our internal control over
financial reporting.




PART
II — OTHER INFORMATION




Item
1. Legal Proceedings.





None.




Item
1A. Risk Factors





Not
applicable.




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





(a)           Unregistered Sales of Equity
Securities.




None.




Item
3. Defaults Upon Senior Securities.





None.





Item
4. (Removed and Reserved)





Item
5. Other Information.





Not
applicable.


17


Item
6. Exhibits.


(a)
Exhibits.




Exhibit
                  
                  Item31.1
                  
                  Certification
      of Principal Executive and Principal Financial Officer pursuant to Section
      302(a) of the Sarbanes-Oxley Act of 200232.1*
                  
                  Certification
      of Principal Executive and Principal Financial Officer pursuant to Section
      302(a) of the Sarbanes-Oxley Act of
2002







* This
exhibit shall not be deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934 or otherwise subject to the liabilities of that
section, nor shall it be deemed incorporated by reference in any filing under
the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made
before or after the date hereof and irrespective of any general incorporation
language in any filings.





SIGNATURES





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




MAJESTIC
      OIL & GAS, INC.Date:
      May 13, 2010
                By:
                /s/ Patrick
      Montalban(Authorized
      Officer/principal Executive
                  Officer,
      Principal Financial
                  Officer/principal
      Financial Officer}




18





EXHIBIT
INDEX





Exhibit
                  
                  Item31.1
                  
                  Certification
      of Principal Executive and Principal Financial Officer pursuant to Section
      302(a) of the Sarbanes-Oxley Act of 200232.1*
                  
                  Certification
      of Principal Executive and Principal Financial Officer pursuant to Section
      906 of the Sarbanes-Oxley Act of
2002





* This
exhibit shall not be deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934 or otherwise subject to the liabilities of that
section, nor shall it be deemed incorporated by reference in any filing under
the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made
before or after the date hereof and irrespective of any general


19