UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-Q/A



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

For the quarterly period ended June 30, 2008



OR



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



For the transition period from ________________________________



Commission File Number: 000-51449





INTERNATIONAL POWER GROUP, LTD.

(Exact name of registrant as specified in its charter)



|                                               |  |                                  
|---------------------------------------------- |  | ---------------------------------
|Delaware                                       |  | 20-1686022                       
|(State or other jurisdiction of incorporation) |  | (IRS Employer Identification No.)



|                                                |  |           
|----------------------------------------------- |  | ----------
|950 Celebration Blvd. Suite A, Celebration, FL. |  | 34747     
|(Address of principal executive office)         |  | (Zip Code)



(407) 566-0318

(Issuers telephone number)



|                                                                                 |     | 
|-------------------------------------------------------------------------------- | --- | 
|                                                                                 | N/A | 
|(Former name, former address & former fiscal year, if changed since last report)



Check whether the issuer (1) has filed all documents and reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filings 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 November 14, 2008, the number of the Company's shares of par value $0.00001 common stock outstanding was 592,588,137.



Transitional Small Business Disclosure Format (check one)    [  ] Yes   [X] No



Page 1 of 26





EXPLANATORY NOTE









Reference is made to Item 5 of Part I of the Form10-Q for the quarterly period ending September 30, 2008 filed on November 19, 2008. As indicated therein, this amendment is being filed for the purpose of correcting certain figures in the Consolidated Statements of Operations and the Cash Flow Statement (specifically, Operating and Financial activities) contained in the Form10-Q for the quarterly period ending June 30, 2008 (filed on August 18, 2008) that resulted in an understatement in that report of the net loss for the three and six months ending June 30, 2008 in the. In addition, corresponding corrections consistent with the changes in the financial statements have been made in Managements Discussion and Analysis or Plan of Operation (Item 2 of Part I).



The errors were a result of clerical errors in preparing the financial statements and were not detected by the certifying officers.  In addition, review by certifying officers failed to detect the errors.  The errors were limited primarily to the Balance Sheet and Statement of Operations for the three months and six ended June 30, 2008, and to the Cash Flow Statement of operations, resulting in an overstatement of the net loss for the six and three month period by $78,064, as well as related footnotes.  The errors include amounts previously recorded as part of the $800,000 convertible loan obtained by the company during the second quarter of year 2008. Specifically, the shares of stock and warrants issued in association with the transaction were not recorded according to the nature of the transaction and treated as regular shares for services and the warrant value recorded as a regular warrant issuance. Further review of the transaction and the supporting documents reveled the amount expensed for the shares issued at closing in the amount of $672,000 should had been treated as shares issued for discount instead, Also the value of warrants recorded to paid in capital in the amount of $240,000 was recorded as part of the loan discount. The discount will be amortized over the life of the loan, that is, one year. This resulted in an additional charge of $188,493 during the quarter ended June 30, 2008



We also adjusted $86,154 in items recorded as miscellaneous receivables to expense after carefully reviewing the collectability of those items. An excess discount over the principal amount of the convertible loan of $307,750 was also recorded as a period expense during the same quarter.



All related footnotes have been corrected and corresponding revisions of the Managements Discussion and Analysis or Plan of Operation section (Item 2 of Part I) of the subject Form 10-Q have been made.



Finally, in addition and unrelated to the above, this amendment also contains revisions to Item 4  of Part I of the report (Internal Controls), so that it is consistent with similar sections contained in the Companys Form 10Q for the quarter ending September 30, 2008.





Page 2 of 26











International Power Group, Ltd.

Form 10-Q

Period Ended June 30, 2008









TABLE OF CONTENTS





PART I  FINANCIAL INFORMATION

4

Item 1 - Financial Statements

4

Item 2- Managements Discussion and Analysis of Financial Condition and Results of Operations

16

Item 3 - Quantitative and Qualitative Disclosures about Market Risk

22

Item 4 - Controls and Procedures

22

PART II - OTHER INFORMATION

23

Item 1 - Legal Proceedings

23

Item 1A - Risk Factors

23

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

23

Item 3 - Defaults upon Senior Securities

23

Item 4 - Submission of Matters to a Vote of Security Holders

23

Item 5 - Other Information

23

Item 6 - Exhibits

24

SIGNATURES

25

INDEX TO ATTACHED EXHIBITS

26





Page 3 of 26





PART I  FINANCIAL INFORMATION

Item 1 - Financial Statements



INTERNATIONAL POWER GROUP, LTD

(A Development Stage Company)

CONSOLIDATED BALANCE SHEETS

(Unaudited)





|                                                                                                                                           |                       |  |                        
|------------------------------------------------------------------------------------------------------------------------------------------ | --------------------- |  | -----------------------
|                                                                                                                                           | June 30, 2008         |  | December 31, 2007      
|                                                                                                                                           | (unaudited)           |  | (audited)              
|ASSETS                                                                                                                                     |                       |  |                        
|Current Assets                                                                                                                             |                       |  |                        
|Cash                                                                                                                                       | $               7,659 |  | $                     -
|Miscellaneous receivable - net                                                                                                             | 22,492                |  | 32,182                 
|Stock subscriptions receivable                                                                                                             | 110,000               |  | -                      
|Prepaid expenses                                                                                                                           | 24,567                |  | 133                    
|Total current assets                                                                                                                       | 164,718               |  | 32,315                 
|                                                                                                                                           |                       |  |                        
|Other Assets                                                                                                                               |                       |  |                        
|Patents-net                                                                                                                                | 2,150,412             |  | 2,300,000              
|Deposit                                                                                                                                    | 27,000                |  | 16,766                 
|Other assets                                                                                                                               | 14,362                |  | 14,360                 
|Total other assets                                                                                                                         | 2,191,774             |  | 2,331,126              
|Total Assets                                                                                                                               | $        2,356,492    |  | $        2,363,441     
|                                                                                                                                           |                       |  |                        
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                       |                       |  |                        
|Liabilities                                                                                                                                |                       |  |                        
|Accounts payable                                                                                                                           | 1,050,293             |  | 955,111                
|Accrued expenses                                                                                                                           | 20,603                |  | 38,336                 
|Loans payable to related parties                                                                                                           | 459,069               |  | 755,874                
|Acquisition payable                                                                                                                        | 962,057               |  | 962,057                
|Convertible loan                                                                                                                           | 188,493               |  | -                      
|Deposits for Stock                                                                                                                         | 20,000                |  | -                      
|Total current liabilities                                                                                                                  | $        2,700,515    |  | $        2,711,378     
|                                                                                                                                           |                       |  |                        
|Stockholder's Deficit                                                                                                                      |                       |  |                        
|                                                                                                                                           |                       |  |                        
|Common stock: authorized, 750,000,000 shares of $.0001 par value; issued and outstanding, 465,001,973 and 373,441,971 shares, respectively | 4,650                 |  | 3,734                  
|Capital in excess of par value                                                                                                             | 26,006,048            |  | 17,434,713             
|Additional paid in capital - Warrants                                                                                                      | 2,747,090             |  | 1,568,702              
|Additional paid in capital - Options                                                                                                       | 3,800,000             |  | 3,653,000              
|Accumulated other comprehensive income                                                                                                     | (195)                 |  | 1,869                  
|Deficit accumulated during development stage                                                                                               | (32,901,616)          |  | (23,009,955)           
|Total stockholders deficit                                                                                                                | (344,023)             |  | (347,937)              
|Total Liabilities and Stockholder's Deficit                                                                                                | $        2,356,492    |  | $            2,363,441 







The accompanying notes are integral part of these consolidated financial statements





Page 4 of 26





INTERNATIONAL POWER GROUP, LTD

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT ACCUMULATED DURING

DEVELOPMENT STAGE

(Unaudited)





|                             |                           |  |                          |  |                                
|---------------------------- | ------------------------- |  | ------------------------ |  | -------------------------------
|                             |                           |  |                          |  |                                
|                             | Three Months Ended        |  | Three Months Ended       |  | April 15 2002
Date of Inception
|                             | June 30, 2008             |  | June 30, 2007            |  | to June 30, 2008               
|                             |                           |  |                          |  |                                
|Revenues                     | $                       - |  | $                      - |  | $                      -       
|                             |                           |  |                          |  |                                
|Expenses                     | 5,200,392                 |  | 1,486,471                |  | 32,287,114                     
|                             |                           |  |                          |  |                                
|Operating Loss               | (5,200,392)               |  | (1,486,471)              |  | (32,287,114)                   
|                             |                           |  |                          |  |                                
|Other Income (Expense):      |                           |  |                          |  |                                
|Miscellaneous income         | 8,811                     |  | 10                       |  | 13,489                         
|Interest expense             | (312,982)                 |  | (24)                     |  | (320,241)                      
|Excess discount expense      | (307,750)                 |  | -                        |  | (307,750)                      
|                             |                           |  |                          |  |                                
|Loss accumulated during      |                           |  |                          |  |                                
|development stage            | $       (5,812,313)       |  | $     (1,486,485)        |  | $   (32,901,616)               
|                             |                           |  |                          |  |                                
|Other Comprehensive Income:  |                           |  |                          |  |                                
|Foreign currency translation |                           |  |                          |  |                                
|gain                         | 2,649                     |  | -                        |  |                                
|                             |                           |  |                          |  |                                
|Total comprehensive loss     | $      (5,809,664)        |  | $     (1,486,485)        |  |                                
|                             |                           |  |                          |  |                                
|Net Loss per Share           |                           |  |                          |  |                                
|Basic and Diluted            | $               (0.01)    |  | $              (0.00)    |  |                                
|                             |                           |  |                          |  |                                
|Weighted Average Number      |                           |  |                          |  |                                
|of Shares Outstanding -      |                           |  |                          |  |                                
|Basic and Diluted            | 431,981,478               |  | 350,648,341              |  |                                











The accompanying notes are integral part of these consolidated financial statements





Page 5 of 26





INTERNATIONAL POWER GROUP, LTD

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT ACCUMULATED DURING

DEVELOPMENT STAGE

(Unaudited)





|                             |                               |  |                             |  |                             
|---------------------------- | ----------------------------- |  | --------------------------- |  | ----------------------------
|                             |                               |  |                             |  | April 15 2002               
|                             | Six Months Ended              |  | Six Months Ended            |  | Date of Inception           
|                             | June 30, 2008                 |  | June 30, 2007               |  | To June 30, 2008            
|                             |                               |  |                             |  |                             
|Revenues                     | $                           - |  | $                         - |  | $                          -
|                             |                               |  |                             |  |                             
|Administrative expenses      | 9,277,158                     |  | 3,714,409                   |  | 32,287,114                  
|                             |                               |  |                             |  |                             
|Operating Loss               | (9,277,158)                   |  | (3,714,409)                 |  | (32,287,114)                
|                             |                               |  |                             |  |                             
|Other Income (Expense):      |                               |  |                             |  |                             
|Miscellaneous  income        | 9,314                         |  | 14                          |  | 13,992                      
|Interest expense             | (316,067)                     |  | (48)                        |  | (320,744)                   
|Excess discount expense      | (307,750)                     |  | -                           |  | (307,750)                   
|                             |                               |  |                             |  |                             
|Loss accumulated during      |                               |  |                             |  |                             
|development stage            | $             (9,891,661)     |  | $           (3,714,443)     |  | $         (32,901,616)      
|                             |                               |  |                             |  |                             
|Other Comprehensive Income:  |                               |  |                             |  |                             
|Foreign currency translation |                               |  |                             |  |                             
|loss                         | (585)                         |  | -                           |  |                             
|                             |                               |  |                             |  |                             
|Total comprehensive loss     | $             (9,892,344)     |  | $           (3,714,443)     |  |                             
|                             |                               |  |                             |  |                             
|Net Loss per Share           |                               |  |                             |  |                             
|Basic and Diluted            | $                      (0.02) |  | $                    (0.01) |  |                             
|                             |                               |  |                             |  |                             
|Weighted Average Number      |                               |  |                             |  |                             
|of Shares Outstanding -      |                               |  |                             |  |                             
|Basic and Diluted            | 412,975,077                   |  | 349,108,592                 |  |                             









The accompanying notes are integral part of these consolidated financial statements





Page 6 of 26





INTERNATIONAL POWER GROUP, LTD.

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



|                                                                            |                                |  |                                |  |                                                          
|--------------------------------------------------------------------------- | ------------------------------ |  | ------------------------------ |  | ---------------------------------------------------------
|                                                                            |                                |  |                                |  | April 15, 2002                                           
|                                                                            | Six Months Ended June 30, 2008 |  | Six Months Ended June 30, 2007 |  | (Date of Inception of Development Stage) to June 30, 2008
|Cash Flows From Operating Activities:                                       |                                |  |                                |  |                                                          
|Net loss from operations                                                    | ($9,891,661)                   |  | ($3,714,443)                   |  | ($32,901,616)                                            
|Adjustments to reconcile net loss to net cash used by operating activities: |                                |  |                                |  |                                                          
|                                                                            |                                |  |                                |  |                                                          
|Changes not requiring cash outlay:                                          |                                |  |                                |  |                                                          
|Value of options granted                                                    | 185,000                        |  | 875,000                        |  | 6,137,000                                                
|Common stock issued for services                                            | 7,248,638                      |  | 253,000                        |  | 14,056,439                                               
|Options exercised for services                                              | 190,000                        |  | -                              |  | 525,000                                                  
|Amortization - Patents                                                      | 200,000                        |  | 200,000                        |  | 700,000                                                  
|Amortization - Loan discounts                                               | 188,493                        |  | -                              |  | 188,493                                                  
|Excess discounts over loan balance                                          | 307,750                        |  | -                              |  | 307,750                                                  
|Impairment charges                                                          | -                              |  | -                              |  | 123,000                                                  
|                                                                            |                                |  |                                |  |                                                          
|Changes in assets and liabilities:                                          |                                |  |                                |  |                                                          
|(Increase) decrease in prepaid expenses                                     | (24,437)                       |  | (15,112)                       |  | (44,391)                                                 
|Increase (decrease) in accounts payable                                     | 94,915                         |  | 92,572                         |  | 1,050,080                                                
|(Decrease) increase in accrued expenses                                     | (17,733)                       |  | 30,547                         |  | (12,403)                                                 
|Decrease (Increase) in deposits                                             | (10,234)                       |  | (24,104)                       |  | (11,866)                                                 
|Decrease (Increase) in Misc. receivable                                     | 9,689                          |  | -                              |  | 9,689                                                    
|Decrease (Increase) in other assets                                         | -                              |  | 9,715                          |  | (8,903)                                                  
|Net cash consumed by operating activities                                   | (1,519,580)                    |  | (2,292,825)                    |  | (9,881,729)                                              
|                                                                            |                                |  |                                |  |                                                          
|Cash Flows From Investing Activities:                                       |                                |  |                                |  |                                                          
|Acquisition of Add-Power                                                    | -                              |  | (602,272)                      |  | (1,037,943)                                              
|Investment in Mexican company                                               | -                              |  | -                              |  | (2,500)                                                  
|Note receivable                                                             | -                              |  | -                              |  | (65,000)                                                 
|Proceeds from note receivable                                               | -                              |  | -                              |  | 65,000                                                   
|Patents                                                                     | (50,412)                       |  | (70,774)                       |  | (50,412)                                                 
|Net cash consumed by investing activities                                   | (50,412)                       |  | (673,046)                      |  | (1,090,855)                                              
|Cash Flows From Financing Activities:                                       |                                |  |                                |  |                                                          
|                                                                            |                                |  |                                |  |                                                          
|Proceeds from loans                                                         | 604,250                        |  | 160,000                        |  | 1,899,802                                                
|Proceeds from other loans                                                   | 95,965                         |  | -                              |  | 95,965                                                   
|Repayments of loans                                                         | (142,500)                      |  | (21,205)                       |  | (682,178)                                                
|Proceeds of sales of stock units                                            | 1,002,000                      |  | 944,750                        |  | 7,836,348                                                
|Customer deposits                                                           | 20,000                         |  | -                              |  | 20,000                                                   
|Proceeds from exercise of options                                           |                                |  | -                              |  | 375,000                                                  
|Proceed from exercise of warrants                                           | -                              |  | 287,500                        |  | 1,435,500                                                
|Net cash provided by financing activities                                   | 1,579,715                      |  | 1,371,045                      |  | 10,980,436                                               
|                                                                            |                                |  |                                |  |                                                          
|Effect of foreign currency exchange rate on cash                            | (2,064)                        |  | 1,604                          |  | (195)                                                    
|Net increase in cash                                                        | 7,659                          |  | (1,593,222)                    |  | 7,657                                                    
|Cash balance, beginning of period                                           | -                              |  | 1,652,940                      |  | -                                                        
|Cash balance, end of period                                                 | $7,659                         |  | $59,718                        |  | $7,657                                                   









The accompanying notes are integral part of these consolidated financial statements



Page 7 of 26









INTERNATIONAL POWER GROUP, LTD.

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2008

(Unaudited)





Note 1.

BASIS OF PRESENTATION



The unaudited interim consolidated financial statements of International Power Group, Ltd. as of June 30, 2008 and December 31, 2007 and for the three and six months ended March 31 and June 30,, 2008 have been prepared in accordance with accounting principles generally accepted in the United States of America. In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of such periods. The results for the three and six months ended June 30, 2008 are not necessarily indicative of the results to be expected for the full year ending December 31, 2008. Certain information and disclosures normally included in the notes to consolidated financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading.  The accompanying unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements of the Company for the year ended December 31, 2007 filed in the Companys report on Form 10-K.



As a result, of an internal review, the company determined that adjustments were required for the June 30, 2008 Form 10 Q. These adjustments were primarily required to properly account for the discounts associated with the convertible note issued during the quarter ended June 30, 2008.



Effect of corrections in the Balance Sheet as of June 30, 2008.



|                                      |                             |  |            |     |             
|------------------------------------- | --------------------------- |  | ---------- | --- | ------------
|                                      | Balance Sheet June 30, 2008
|                                      |                             |  |            |     |             
|                                      | Previously                  |  | Increase   |     | As          
|                                      | Reported                    |  | (Decrease) |     | Restated    
|                                      |                             |  |            |     |             
|Miscellaneous receivables             | $108,646                    |  | ($86,154)  | (1) | $22,492     
|                                      |                             |  |            |     |             
|Total Assets                          | $2,442,646                  |  | ($86,154)  |     | $2,356,492  
|                                      |                             |  |            |     |             
|Convertible loan, net                 |                             |  |            |     |             
|of discount                           | 800,000                     |  | (800,000)  | (2) | 188,493     
|                                      |                             |  | 188,493    | (3) |             
|                                      |                             |  |            |     |             
|Liabilities                           | $3,312,022                  |  | ($611,507) |     | $2,700,515  
|                                      |                             |  |            |     |             
|PIC                                   | 24,998,759                  |  | 800,000    | (2) | 26,006,049  
|                                      |                             |  | 207,289    | (4) |             
|                                      |                             |  |            |     |             
|PIC-warrants                          | 3,307,090                   |  | (560,000)  | (2) | 2,747,090   
|                                      |                             |  |            |     |             
|                                      |                             |  | (86,154)   | (1) |             
|Deficit                               | (32,979,680)                |  | 560,000    | (2) | (32,901,616)
|                                      |                             |  | (188,493)  | (3) |             
|                                      |                             |  | (207,289)  | (4) |             
|                                      |                             |  |            |     |             
|Total deficiency                      | (869,376)                   |  | 525,353    |     | (344,023)   
|                                      |                             |  |            |     |             
|Liabilities and Stockholders' deficit | $2,442,646                  |  | ($86,154)  |     | $2,356,492  



Effect of corrections in the three-month period ended June 30, 2008.





Page 8 of 26











|                                                             |              |  |            |     |             
|------------------------------------------------------------ | ------------ |  | ---------- | --- | ------------
|Statement of Operations for Three Months Ended June 30, 2008
|                                                             |              |  |            |     |             
|                                                             |              |  |            |     |             
|                                                             | Previously   |  | Increase   |     | As          
|                                                             | Reported     |  | (Decrease) |     | Restated    
|                                                             |              |  |            |     |             
|Administrative expenses                                      | $5,774,699   |  | $86,154    | (1) | $5,200,392  
|                                                             |              |  | (867,750)  | (2) |             
|                                                             |              |  | 207,289    | (4) |             
|                                                             |              |  |            |     |             
|                                                             |              |  |            |     |             
|Operating loss                                               | (5,774,699)  |  | 574,307    |     | (5,200,392) 
|                                                             |              |  |            |     |             
|Interest expense                                             | (124,489)    |  | (188,493)  | (3) | (312,982)   
|                                                             |              |  |            |     |             
|Excess discount                                              |              |  | (307,750)  | (2) | (307,750)   
|                                                             |              |  |            |     |             
|Net Loss                                                     | ($5,890,377) |  | $78,064    |     | ($5,812,313)
|                                                             |              |  |            |     |             
|Total Comprehensive Loss                                     | ($5,887,728) |  | $78,064    |     | ($5,809,664)





Effect of corrections in the six-month period ended June 30, 2008.





|                                                           |              |  |            |     |             
|---------------------------------------------------------- | ------------ |  | ---------- | --- | ------------
|Statement of Operations for Six Months Ended June 30, 2008
|                                                           |              |  |            |     |             
|                                                           | Previously   |  | Increase   |     | As          
|                                                           | Reported     |  | (Decrease) |     | Restated    
|                                                           |              |  |            |     |             
|Administrative expenses                                    | $9,851,465   |  | $86,154    | (1) | $9,277,158  
|                                                           |              |  | (867,750)  | (2) |             
|                                                           |              |  | 207,289    | (4) |             
|                                                           |              |  |            |     |             
|                                                           |              |  |            |     |             
|Operating loss                                             | (9,851,465)  |  | 574,307    |     | (9,277,158) 
|                                                           |              |  |            |     |             
|Interest expense                                           | (127,574)    |  | (188,493)  | (3) | (316,067)   
|                                                           |              |  |            |     |             
|Excess discount                                            |              |  | (307,750)  | (2) | (307,750)   
|                                                           |              |  |            |     |             
|                                                           |              |  |            |     |             
|Net Loss                                                   | ($9,969,725) |  | $78,064    |     | ($9,891,661)
|                                                           |              |  |            |     |             
|                                                           |              |  |            |     |             
|Total Comprehensive Loss                                   | ($9,970,408) |  | $78,064    |     | ($9,892,344)



Page 9 of 26











Effect of corrections on cumulative deficit as of June 30, 2008



|                                            |               |  |            |     |               | 
|------------------------------------------- | ------------- |  | ---------- | --- | ------------- | 
|Statement of Operations (Cumulative Deficit
|since inception of development stage)      
|                                            |               |  |            |     |              
|                                            | Previously    |  | Increase   |     | As           
|                                            | Reported      |  | (Decrease) |     | Restated     
|                                            |               |  |            |     |              
|Administrative expenses                     | $32,861,421   |  | $86,154    | (1) | $32,287,114  
|                                            |               |  | (867,750)  | (2) |              
|                                            |               |  | 207,289    | (4) |              
|                                            |               |  |            |     |              
|                                            |               |  |            |     |              
|Operating loss                              | (32,861,421)  |  | 574,307    |     | (32,287,114) 
|                                            |               |  |            |     |              
|Interest expense                            | (131,748)     |  | (188,493)  | (3) | (320,241)    
|                                            |               |  |            |     |              
|Excess discount                             | 0             |  | (307,750)  | (2) | (307,750)    
|                                            |               |  |            |     |              
|Loss                                        | ($32,979,680) |  | $78,064    |     | ($32,901,616)





Effect of corrections on cash flows for the six-month period ended June 30, 2008





|                                                           |               |  |              |     |              
|---------------------------------------------------------- | ------------- |  | ------------ | --- | -------------
|Statement of Cash Flows for Six Months Ended June 30, 2008
|                                                           |               |  |              |     |              
|                                                           | Previously    |  | Increase     |     | As           
|                                                           | Reported      |  | (Decrease)   |     | Restated     
|                                                           |               |  |              |     |              
|Net loss                                                   | $ (9,969,725) |  | $     78,064 |     | $ (9,891,661)
|                                                           |               |  |              |     |              
|Amortize debt discount                                     |               |  | 188,493      | (3) | 188,493      
|                                                           |               |  |              |     |              
|Equity items for services                                  | 7,713,349     |  | (672,000)    | (2) | 7,248,638    
|                                                           |               |  | 207,289      | (4) |              
|                                                           |               |  |              |     |              
|Excess discount                                            |               |  | 307,750      | (2) | 307,750      
|                                                           |               |  |              |     |              
|Miscellaneous receivables                                  | (76,465)      |  | 86,154       | (1) | 9,689        
|                                                           |               |  |              |     |              
|Cash consumed in operations                                | $ (1,715,330) |  | $   195,750  |     | $ (1,519,580)
|                                                           |               |  |              |     |              
|Loan proceeds                                              | 895,965       |  | (195,750)    | (2) | 604,250      
|                                                           |               |  |              |     | 95,965       
|                                                           |               |  |              |     |              
|Cash provided by financing                                 | $  1,775,465  |  | $  (195,750) | (2) | $ 1,579,715  







Page 10 of 26









Effect of corrections on cumulative cash flows for the six-month period ended June 30, 2008





|                                                  |               |  |            |     |                
|------------------------------------------------- | ------------- |  | ---------- | --- | ---------------
|Statement of Cash Flows                          
|(Cumulative since inception of development stage)
|                                                  |               |  |            |     |                
|                                                  | Previously    |  | Increase   |     | As             
|                                                  | Reported      |  | (Decrease) |     | Restated       
|                                                  |               |  |            |     |                
|Net loss                                          | $(32,979,680) |  | $   78,064 |     | $(32,901,616)  
|                                                  |               |  |            |     |                
|Amortize debt discount                            |               |  | 188,493    | (3) | 188,493        
|                                                  |               |  |            |     |                
|Equity items for services                         | 14,711,150    |  | (672,000)  | (2) | 14,246,439     
|                                                  |               |  | 207,289    | (4) |                
|                                                  |               |  |            |     |                
|Excess discount                                   |               |  | 307,750    | (2) | 307,750        
|                                                  |               |  |            |     |                
|                                                  |               |  |            |     |                
|Miscellaneous receivables                         | (76,465)      |  | 86,154     | (1) | 9,689          
|                                                  |               |  |            |     |                
|Cash consumed in operations                       | $(10,077,478) |  | $  195,750 |     | $(9,881,728)   
|                                                  |               |  |            |     |                
|                                                  |               |  |            |     |                
|                                                  |               |  |            |     |                
|Loan proceeds                                     | 895,965       |  | (195,750)  | (2) | 604,250        
|                                                  |               |  |            |     | 95,965         
|Proceeds from stock                               | 7,946,348     |  | (110,000)  | (5) | 7,836,348      
|                                                  |               |  |            |     |                
|Cash provided by financing                        | $11,286,186   |  | $(305,750) |     | $10,980,437    
|                                                  |               |  |            |     |                
|Net change in cash                                | $     117,659 |  | $(110,000) | (5) | $         7,659



Explanations for changes



|    |                                                                                   | 
|--- | --------------------------------------------------------------------------------- | 
|(1) | To correct errors in recording miscellaneous receivables                          | 
|(2) | To correct recording of stock and warrants issued in connection with the issuance | 
|    | of convertible loan.                                                              | 
|(3) | To record amortization of debt, discount applicable to current periods.           | 
|(4) | To correct recording of warrants that accompanied shares issued for services.     | 
|(5) | To correct typographical error in cumulative column of Cash Flow Statement        | 





Page 11 of 26









Note 2.

COMMON STOCK AND WARRANTS



The Company issued stock in private placements during the three months period ended September 30 2008.  A total of 5,800,000 shares of common stock were sold for cash. These sales resulted in net proceeds to the Company of $1,112,000 out of which $1,002,000 was received within the period reported and $110,000 was recorded as subscription receivable for shares issued to an individual investor with deposit made after the quarter end. These shares were sold as part of stock units, with each unit consisting of one share of stock and a warrant to purchase one share of stock for each two shares of stock purchased.  For the six-month period, ended June 30, 2008, warrants to purchase 13,262,500 shares of stock were issued exercisable for a period of twelve months.



The company issued 4,800,000 shares of stock and 8,000,000 warrants as part of a loan transaction, which allowed the company to borrow $800,000 from four different investors. The shares and warrants were valued and recorded as a discount. The warrants were issued in two series, namely class A warrants and class B warrants. Class A warrants have a five-year exercise term at a price of $.25 cents and class B warrants have a five-year exercise term at $.15 cents.



Warrant activity during the six -month period ended June 30, 2008 is shown as follows:



|                                                       |            
|------------------------------------------------------ | -----------
|                                                       | 2008       
|Balance December 31, 2007                              | 11,737,123 
|Warrants granted during the first six months of 2008   | 24,392,501 
|Warrants exercised during the first six months of 2008 | -          
|Warrants expired during the first six months of 2008   | (3,381,873)
|Balance June 30, 2008                                  | 32,747,751 





Relevant information about the warrants outstanding at June 30, 2008 is presented below:



|         |                  |                  
|-------- | ---------------- | -----------------
|Exercise | Weighted-Average | Outstanding as of
|Price    | Months Remaining | June 30, 2008    
|$0.40    | 24.06            | 5,850,000        
|$0.25    | 7.82             | 22,897,751       
|$0.15    | 57.90            | 4,000,000        
|Total    |                  | 32,747,751       



There were no warrant exercised during the six-month period ended on June 30, 2008



Note 3.

STOCK OPTIONS



During 2005, the Company adopted and the stockholders approved a stock option plan (the Plan).  The Plan permits the Board of Directors to grant options to purchase up to 30,000,000 shares of common stock to officers, employees, and key individuals deemed important to the success of the Company.  All options are vested upon issuance and are immediately exercisable.  The Plan has a term that runs through June 15, 2010.  Under the terms of the plan, the exercise price shall not be less than the market value as determined at date of grant.  The following table summarizes changes in outstanding stock options during the three month period ended June 30, 2008.



|                                         |              |                 
|---------------------------------------- | ------------ | ----------------
|                                         | # of Options | Avg. Price      
|Outstanding at the beginning of the year | 26,825,000   | $           0.42
|Granted (all at market price)            | 1,500,000    | .19             
|Cancelled                                | (1,900,000)  | .10             
|Outstanding at the end of the period     | 26,425,000   | $         0.43  





The fair value of option granted is estimated using a Black-Sholes option-pricing model.  The following weighted-average assumptions were used for options granted during the three months ended June 30, 2008 and 2007.





Page 12 of 26









INTERNATIONAL POWER GROUP, LTD.

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2008

(Unaudited)



|                                                     |                    |                      
|---------------------------------------------------- | ------------------ | ---------------------
|                                                     | 2008               | 2007                 
|Dividend yield                                       | 0%                 | 0%                   
|Expected volatility                                  | 183%               | 193%                 
|Risk-free interest rate                              | 2.34%              | 4.96%                
|Expected term (in years)                             | 1.96               | 3.02                 
|Weighted-average fair value of stock options granted | $             0.43 | $                0.45





Note 4. INTANGIBLE ASSET - PATENTS



Information regarding the intangible asset  patents is as follows:



|                                |  |             
|------------------------------- |  | ------------
|                                |  | June 30 2008
|Intangible asset - patents      |  | $2,850,412  
|Accumulated amortization        |  | (700,000)   
|Intangible asset  patents, net |  | $2,150,412  



Amortization expense was $200,000 for the six -month period ended June 30, 2008.



Note 5.  LOANS PAYABLE



During the second quarter, the Company approved a convertible loan agreement that has $ 30.0 million due maximum. An initial $800,000 installment represented by a 12% loan due April 7, 2009, was received in the second quarter and is convertible to stock at a conversion price of $ .12 for six months and at 75% of the average of the three lowest closing bid prices of the companys common stock for the ten trading days preceding a conversion date, thereafter. As part of the loan agreement, the Company agreed to issue 4.8 million shares of stock and 4 million Class A warrants exercisable at $ .15 for five years and 4 Class B warrants exercisable at $ .25 for five years.



The value of stock issued as well as the warrants was recorded as a discount with the excess over the loan principal expensed during the period. The discount will be amortized over the loan term, which is one year ending in April 4, 2009. The loan discount also included those origination and legal costs incurred in the transaction. The following are the total discounts associate with this transaction:



|                                                |               
|----------------------------------------------- | --------------
|Discount on shares issued at closing            | $   672,000.00
|Value of warrants issued with shares at closing | 240,000.00    
|Closing and legal costs                         | 195,750.00    
|Total value of issuances and loan costs         | $1,107,750.00 
|Less: principal amount                          | (800,000.00)  
|Excess discount on convertible loan             | $   307,750.00



The excess of discount over the loan principal was expense in the period. Amortization of the loan amounted to $188,493 for the second quarter ended June 30, 2008.



The company also owes $962,057.00 on the acquisition of the Add-Power technology during year 2006. The company made a couple of payments in 2006 an 2007, but could not continue paying the balance due to a lack of financing and revenues. This loan agreement is now technically in default. However, the Company managements have been negotiating with seller to satisfy the payment.







Page 13 of 26









INTERNATIONAL POWER GROUP, LTD.

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2008

(Unaudited)





Note 6.

RELATED PARTY TRANSACTIONS



During the second quarter of 2008, USPM, an affiliated company whose officers are also part of the board of International Power Group, Ltd. provided an additional loan to the Company in the amount of $65,000.00. The loan was used to secure patented technology and R&D for Add-Power in the European Union. The loan has a term of one year expiring in April 8, 2009 and carries a 6% interest rate. There were no other transactions with related parties during this period.



Note 7.

OPERATING EXPENSES



Major categories of operating expenses are presented below:



|                                     |                                |  |                                |  |                                                                         
|------------------------------------ | ------------------------------ |  | ------------------------------ |  | ------------------------------------------------------------------------
|Detail of Expenses by Category       | Six Months Ended June 30, 2008 |  | Six Months Ended June 30, 2007 |  | April 15, 2002 (Date of Inception of Development Stage) to June 30, 2008
|                                     |                                |  |                                |  |                                                                         
|Stock based compensation             | $         958,000              |  | $       875,000                |  | $        6,975,000                                                      
|Consulting expense                   | 6,300,452                      |  | 715,594                        |  | 15,710,485                                                              
|Professional fees                    | 832,719                        |  | 396,233                        |  | 2,753,116                                                               
|Research and development             | 89,441                         |  | -                              |  | 215,288                                                                 
|Impairment                           | -                              |  | -                              |  | 123,000                                                                 
|Office expenses                      | 58,929                         |  | 33,322                         |  | 335,679                                                                 
|Travel and meals                     | 106,100                        |  | 326,136                        |  | 1,421,428                                                               
|Public relations                     | 2,569                          |  | 197,631                        |  | 464,731                                                                 
|Salaries and other employee expenses | 482,929                        |  | 744,371                        |  | 2,413,344                                                               
|Insurance                            | 27,031                         |  | 9,354                          |  | 86,798                                                                  
|Automobile expenses                  | 27,442                         |  | 28,654                         |  | 146,259                                                                 
|Telecommunications                   | 8,327                          |  | 46,814                         |  | 202,912                                                                 
|Rent                                 | 71,643                         |  | 91,409                         |  | 371,067                                                                 
|Amortization                         | 200,000                        |  | 200,000                        |  | 700,000                                                                 
|Other expenses                       | 111,578                        |  | 49,890                         |  | 368,009                                                                 
|Total expenses                       | $  9,277,158                   |  | $3,714,409                     |  | $32,287,114                                                             





Note 8.

SUPPLEMENTAL CASH FLOWS



There was no cash paid for income taxes during any of the periods presented.  The company paid $3,085 on interest during the three month period ended June 30, 2008. The following non-cash activities took place during the periods presented:



During the six-month period ended in June 30, 2008, the company had issued a total of 57,620,000 shares of stock for services to a total of 37 individuals with a total value of $7,248,638.



Page 14 of 26











From that total, the Company issued 43,955,000 shares of common stock to 25 individuals for services valued at $4,138,239 during the second quarter ended June 30, 2008



There were 4,800,000 shares issued for discount valued at $672,000 and 8,000,000 warrants issued valued at $240,000 that are reflected as discounts on the convertible loan taken in the second quarter of 2008.



Note 9. GOING CONCERN



The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  As shown in the financial statements, the Company has experienced continuing losses that resulted in a material working capital deficiency, and an accumulated deficit of $ 32.8 million as of June 30, 2008.  These factors raise substantial doubt about the ability of the Company to continue as a going concern.



The financial statements do not include adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue in operation.  The Companys present plans, the realization of which cannot be assured, to overcome these difficulties include but are not limited to the continuing effort to raise capital in the public and private markets.



Note 10. CONTINGENCIES



None



Note 11. SUBSEQUENT EVENTS



During the month of July 2008, the Company management detected an embezzlement scheme perpetrated by one company employee. The matter was immediately investigated and brought to the employees attention with admission on the fraud scheme. The total amount accounted for was $35,233.97 and the individual claimed it had already used all the money. From this total, $28,810.00 has been reclassified as a receivable and a reserve for uncollectible established and the rest as been expensed as unauthorized salaries.



The employee was immediately terminated and a case was filed with the local police and there is an ongoing investigation at this time. The matter was also brought to the board and they were told about the corrective action taken to prevent this type of incident from recurring.







Page 15 of 26













Item 2- Managements Discussion and Analysis of Financial Condition and Results of Operations



FORWARD-LOOKING STATEMENTS



This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of  Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, which relate to future events or our future financial performance.  In some cases, you can identify forward-looking statements by terminology such as may, intends, should, expects, plans, anticipates, believes, estimates, predicts, potential or continue or the negative of these terms or other comparable terminology.  These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled Risk Factors in our Annual Report on Form 10-K/A for our fiscal year ended December 31, 2007 filed with the United States Securities and Exchange Commission , that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.



While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein.  Except as required by applicable law, including the securities laws of the United States, we undertake no obligation to update any of the forward-looking statements whether as a result of new information, future events or otherwise.



Overview



We commenced our development stage on April 15, 2002.  The Company has spent approximately the last two years initiating and developing our Waste to Energy (WTE) technology business plan.  Initial steps in that process were negotiation for the opportunity to construct WTE Plants in Mexico and Saudi Arabia. As part of our continued effort to tap into the current opportunities provided by alternative energy sources and environmental issues associated with global warming, we have recently initiated contacts within the US and are working on a joint venture to build a WTE plant in the US mainland. We have also been in contact with other countries in the Caribbean interested in building WTE facilities to reduce their dependence on oil to produce energy and reduce waste accumulation.



The second step in developing our business plan was to find sources that could assist us to raise the capital required to build and begin operating WTE facilities.  We have revamped our business plan and have retained the services of expert professionals to make sure we can effectively obtained financing. We are currently working with various sources willing to finance the company and its projects, including the Add-Power technology.



IPWG has not had any revenues and cumulative losses of $33.0 million since inception.  Accordingly, a comparison of our financial information for accounting periods would likely not be meaningful or helpful in making an investment decision regarding our Company.



In July 2006, the Kingdom of Saudi Arabias Presidency of Meteorology and Environment issued to us an environmental license, which will enable us to establish WTE plants in the country.  This license is active for three years and could be renewed with the ministry approval.

At the present time, we are waiting for receipt of permits from some of the projects that we have been pursuing in the different geographic areas and continue assessing the capital requirement for these projects. Although our previous estimate for revenues was for the 4th quarter of 2008, we believe that this target may not be met and will be delayed until calendar year 2009.  Our assessment of the construction timeframe since permit release to revenue generation may take six months. Therefore, in view of the above, a delay in the project revenue target date until 2009 is prudent at this time.



Page 16 of 26









Once all permits are in place, and facilities are prepared for waste collection, we expect to begin realizing operating revenues from waste disposal fees to be collected from municipalities and other waste management related companies in the areas were our projects are located. This is the first phase of our plan before we begin the construction of WTE facilities. Although we believe that it is reasonable to expect revenue from our first WTE energy plant to commence by year 2011 (after the completion of the construction of the first plant), many factors exist that are beyond our control that could delay or even prevent this from happening. These factors include but are not limited to, construction delays, political unrest and severe economic turndowns. Our strategy to construct plants in the US will help us in balancing the risk associated with our offshore projects on this regard.

In October 2006, we purchased proprietary patented technologies, Add-Power, a low temperature turbine (LTT), and Scrub Power, a special emission-to-energy system from three Swedish entities, Anovo AB Angelholm, Add-Power AB Angelholm, and SUPE Ltd for a total consideration of $2.8 million. The prototype has been substantially upgraded through the incurrence of additional research and development costs. We spent around $125,847 during year 2007 and are looking to patent new technology that will make the product more competitive and efficient. It has been tested and results have been drawn from its operating capacity at a Steel Mill in Sweden under a contract arrangement.



The acquisition of these technologies will allow us to convert greater quantities of heat, produced from boilers and turbines, and potentially increase the output of salable electricity by 20 to 30% or more over technologies that are currently available. We also believe that the LTT technology will provide us with an extremely efficient “low-temp turbine” which is powered by a proprietary fluid to drive the turbine and produce electricity at approximately 200° F, whereas most conventional boilers and turbines can only produce electricity at temperatures between 600° - 800° F.



We believe that we will be able to sell these technologies to other companies in the energy industry in order to help them increase their output of electricity. The Company also plans to use these technologies to increase the efficiency of its own planned WTE facilities.  We believe we will begin to receive orders for our Add-Power units in 2009, soon after we have completed the testing and establish the manufacturing process. Other applications are being explored to expand its use and expand our market opportunities for alternate energy sources.



We have presented Add-Power to potential investors through our business plan and have received positive response. We believe financing for Add-Power will be possible to meet our 2009 revenue target for this product. However, we make no assurances on the outcome of our negotiations and of any other factors out of our control that may change investors perception of value and return.



It should be noted that our independent auditors have concluded that there are many factors regarding our company and its operations that raise substantial doubt about the ability of the Company to continue as a going concern and consequently, its ability to raise capital.



Plan of Operation



Because we did not have sufficient financing (debt and/or equity) during the last fiscal year, our Plan of Operation has not significantly changed from our plan indicated in our 10K Report for the year ended December 31, 2007 and during the six month period ended in June 30, 2008



Prior to the adoption of our present business plan, we investigated the option of engaging in the management of low-level radioactive waste as a result of our acquisition of Terra Mar Environmental Systems, Inc. (TMES) assets.  We determined not to pursue that business because of the time and expense of compliance with government regulation in the field.



Our operating plan for year  2008 and thereafter has three components: (1) to complete negotiations to begin a Land field operation and the construction of WTE project in Egypt and Saudi Arabia, (2) complete the research and development of our Add-Power electrical generating unit to make it a commercially viable product, and 3) to continue our existing program of introducing WTE technology to governments and others charged with responsibility to manage solid waste and/or provide potable water and electricity to various population segments.  In furtherance of this general plan, we have self-imposed the following goals:



Page 17 of 26









Research and Development



PROJECTED DATE



|                                                                      |  |                     
|--------------------------------------------------------------------- |  | --------------------
|Goal                                                                  |  | Projected Date      
|                                                                      |  |                     
|1. Processing of site permits in Mexico and start waste collection    |  | Present through 2009
|2. Fabricate and deliver first Add-Power units                        |  | Present through 2009
|3. Generate revenue from Egypt / Saudi landfill operation             |  | Present through 2009
|4. Negotiations for WTE sites in several foreign countries and US     |  |                     
|territory now identified, including forming subsidiaries or strategic |  |                     
|alliances as may be required                                          |  | On going            



Although we have raised $1,112,000 in equity financing and obtained loans to finance the operation, we have not reached the $30 million dollar target required for a full deployment of our resources and execution of the plan., We continue our funding campaign and have been making strides by re focusing our strategy and finding new players with synergies that increases the probability of a successful business relationship.



Research and Development



We do not expect to establish a discrete program of research or development as part of our business plan.  We expect to expend our research and development efforts towards on the job training.  We intend to cooperate with our development partners to develop efficient WTE technology customized to each customers needs.  We intend to share the learning from each project and application to improve all areas of existing WTE technology from air scrubbing to waste disposal.



We have invested in research and development for the Add-Power unit and have tested it under a contract with an operating steel mill in Sweden. The machine has been upgraded and has been performing better than expected, but it will require additional upgrading and design to be able to produce at different outputs in different applications. We are in the process of seeking funding to take the prototype to a design stage and line up the manufacturing of the units.



Purchase of Plant and Equipment



The development and construction of each proposed WTE facility will be dependent on: (i) locating appropriate land and obtaining permits for a WTE facility, (ii) obtaining significant external financing (including related financial guaranty and risk insurance) for purchase of materials and equipment and construction of facilities and (iii) securing contracts for delivery of waste and sales of byproducts necessary to produce revenues sufficient to cover debt service and operation costs. To that regard, we have moved into strategic alliances that allow us for a low cost entry into the markets we are exploring. This will make us move swiftly into some projects and allow us to generate revenues at a low cost possible. In the event we are not able to finance one or more proposed WTE facilities, we would be forced to abandon any such projects.



WTE Facility Finance



Our plan to build one or more WTE facilities will require significant capital, which we do not currently have. We intend to finance the construction and operation of WTE facilities through a combination of loans and securitization of income from long-term contracts for tipping fees, power and potable water sales.  We have been pursuing strategic alliances to provide a stronger position by leveraging experience, track record and managerial expertise in WTE design, construction and operation. With this new approach, we believe that we will be successful in securing such financing although no assurance can be given.  We have entered into an agreement with Marsh USA, Inc., an international insurance broker with the ability to provide financial guaranty insurance and risk management, to locate insurance for our projects.



Page 18 of 26









Changes in the Number of Employees



We expect a substantial increase in full and part time employees in the foreseeable future to bolster our technical and marketing departments.  We hired Mr. Woodrow W. Crouch, CEO with ample experience and track record in designing and building energy plants, John Benvengo, President and COO, who counts with ample experience in landfill design, construction and operations and a host of other professionals and consultants in the field. Once financing is available, we will bring in additional full time staff to support project development and operations.



We expect that plant construction projects will be completed by third parties who will be engaged pursuant to contractual agreements most of whom we are already in negotiation with.



Trends



We believe that the trend that is most likely to affect our business is the burgeoning need of local governments at all levels in most countries to manage sold waste, significant quantities of which are hazardous.  We believe this trend will generate demand for the technology we offer although no assurance can be given.



We also believe the trend of global warming will affect our business.  The need to reduce the output of greenhouse gases has caused a trend to find ways of generating cleaner electricity from cleaner renewable energy sources.  We believe the trend will generate a demand for our technology and services we offer although no assurance can be given.



FINANCIAL CONDITION



Ability to Meet Cash Requirements



We are considered to be in the development stage as defined in the Statement of Financial Accounting Standards (FASB) No. 7.  To date, we have received no income from our business operations.  We have incurred substantial losses since our inception.  As of June 30, 2008, we had an accumulated loss of $32.8 million during the development stage.



Net cash consumed by operating activities during development stage total almost $9.8 million comprised of $20.7 million used in non cash transactions such as issuance of shares of stock for services, stock options exercised for free and value of options granted under our stock option plan. In addition to that, $1.3 million was charged for amortization and impairment charges and the remaining $1.0 million used to pay vendors, employee salaries and other operating expenses.



On the cash transactions, the company invested nearly $1.1 million in asset acquisition, with $1.0 million used to acquire the Add-Power technology and the remaining $0.5 million was invested in other assets.



Total cash provided by financing activities amounted $11.0 million from which $7.8 million came from sales of stock, $1.8 million was provided by exercise of options and warrants and $2.0 came from loans from officers and other borrowing.  An offset of nearly $0.7 million was used to repay loan obligations.



Based on the above data, we believe that without additional equity or debt financing, we will not be able to satisfy our cash requirements for the next twelve months.



Two Year Cash Forecast



We have developed a two-year timeline and cash forecast of our cash needs to execute our business plan and are in the process of raising the funds required to fund our operations for the next 24 months. Our first priority will be the development of the Add-Power unit, which has been already tested and operating at a steel mill in Sweden. Our investment in the manufacturing of the first couple of units should provide us with the foundation to seek contracts from interested customers, some of which have already seen the unit operational and have expressed interest in the Add-Power unit.



Page 19 of 26













We will also pursue WTE projects, specifically those we already have started in Egypt, Saudi Arabia and Mexicali, Mexico. However, our approach will be that of pursuing the landfill permits and construction to be able to operate with revenues from waste collection, until the time we estimate that our first WTE facility will come online. At that Point, we will be in a better financial position to seek additional financing for the development and construction of WTE facilities, all of which will be equipped with the Add-Power unit for a more efficient and low cost energy production.



There can be no assurance, however, that we will be able to raise the amounts of financing required to operate our business until revenues commence, that we will be able to timely commence revenue generating operations of WTE facility (ies) or that if such facility (ies) commence operation, that we will generate sufficient revenue to be profitable.



We are in the process of attempting to raise capital to address approximately $30.3 million of financing needs for the next twenty-four months, outside of construction/project financing for specific waste to energy projects. Uses of the capital we are attempting to raise include:



1)

Working capital to cover overhead and execution costs during construction of waste to energy plants (approximately $18.4 million), additional details provided in the chart below.



2)

Working capital to cover the recently completed acquisition of Add-Power AB and the commercialization of Add-Power units (a patented low temperature turbine used for converting waste heat into electricity) of approximately $1.8 million.



3)

Additional development funding to apply Add-Power technology to low cost solar power generation, as well as to test the feasibility of integrating the Add-Power technology into small scale solar units for office parks, malls, and residential projects ($10.1 million).



A detailed schedule of our capital needs for the two years ended December 31, 2009 is as follows:



|                                            |  |              |  |             |  |              
|------------------------------------------- |  | ------------ |  | ----------- |  | -------------
|                                            |  | 2008         |  | 2009        |  | Total        
|Employee Costs                              |  | $  2,832,450 |  | $4,240,050  |  | $  7,072,500 
|Travel                                      |  | 1,196,000    |  | 1,196,000   |  | 2,392,000    
|Construction/Project Management             |  | 345,000      |  | 828,000     |  | 1,173,000    
|Legal Fees                                  |  | 979,800      |  | 966,000     |  | 1,945,800    
|Outsourced Engineering                      |  | 316,250      |  | 690,000     |  | 1,006,250    
|Contractors/Consultants                     |  | 949,900      |  | 940,700     |  | 1,890,600    
|External & Internal Audit                   |  | 142,600      |  | 345,000     |  | 487,600      
|Corporate Insurance                         |  | 287,500      |  | 517,500     |  | 805,000      
|Accounting Services (Outsourced)            |  | 86,250       |  | 345,000     |  | 431,250      
|Marketing                                   |  | 178,250      |  | 345,000     |  | 523,250      
|Rental /Office Expenses                     |  | 320,850      |  | 345,000     |  | 665,850      
|Total Operating Costs                       |  | $7,634,850   |  | $10,758,250 |  | $18,393,100  
|Additional Investment/Commercialization of  |  |              |  |             |  |              
|other Proprietary Technology                |  |              |  |             |  |              
|Cash for Add-Power Acquisition              |  | 1,798,600    |  | -           |  | 1,798,600    
|R&D of Add-Power unit for commercialization |  | 4,025,000    |  | -           |  | 4,025,000    
|R&D of Add-Power unit for potential solar   |  |              |  |             |  |              
|commercialization                           |  | -            |  | 6,095,000   |  | 6,095,000    
|Total Forecasted Cash Usage Excluding       |  |              |  |             |  |              
|Project Specific Financing                  |  | $13,458,450  |  | $16,853,250 |  | $  30,311,700
|                                            |  |              |  |             |  |              



In addition to the above, we plan to develop and execute contracts for our WTE facilities in Egypt, Mexico and elsewhere, (these contracts may include long term, ie.7-10 year, commitments for waste disposal, electric and water sales).  We expect to use these contracts, and the expected revenue sources



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they represent, to secure project specific financing.  We expect to have multiple financing sources for project/construction financing on a project-by-project basis outside of this specific equity raise.



Payments Due under Contractual Obligations



We have future commitments at March 31, 2007 consisting of office lease obligations as follows:



|                         |  |                         
|------------------------ |  | ------------------------
|                         |  |                         
|Year Ending December 31, |  | Office Lease Obligations
|2008                     |  | 65,459                  
|2009                     |  | 91,603                  
|2010                     |  | 91,443                  
|2011                     |  | 7,639                   
|Total                    |  | $256,144                



In addition, we have a contractual obligation to pay during 2008 the remaining $962,057 for the purchase of Add-Power.  We will not be able to meet this obligation without proceeds of external financing, of which we provide no assurance.



RESULTS OF OPERATIONS



Quarter ended June 30, 2008 compared to the quarter ended June 30, 2007



The company has accumulated net losses during its development stage of $32.9 million. During the first six months of 2008, the company had total expenses of $9,277,158 compared to $3,714,409 during same period in 2007. Net operating losses were $9,891,661 in 2008 and $3,714,443 for the same period in year 2007.



The main contributor for the significant increase in expenses for the comparable period in 2008 and 2007 arises from additional issuance of stock for services and options exercised for free during the six month period ended June 30, 2008. This was due to additional services rendered by consultants and professionals during year 2008 in comparison to the previous year. The effect during the six month period ended June 30, 2008 was an increase of $6.3 million in shares for Services and an increase in officers compensation of roughly $.6 million in comparison for same period in year 2007, or a net increase of $5.7 million in expenses. The Company has depended on issuance of additional shares of stock to pay some of its debt, to compensate for the cash insufficiency. In addition, it has compensated some of the Directors and Officers in an effort to boost its image and strengthen its technical and professional proficiency in the industry field.





CRITICAL ACCOUNTING POLICIES AND ESTIMATES



We have adopted various accounting policies that govern the application of accounting principles generally accepted in the United States of America in the preparation of our financial statements, which requires us to make estimates, and assumptions that affect the amounts reported in the financial statements and accompanying notes.



Although these estimates are based on our knowledge of current events and actions, we may undertake in the future, they may ultimately differ from actual results. Certain accounting policies involve significant judgments and assumptions by us, which have a material impact on our financial condition and results.  Management believes its critical accounting policies reflect its most significant estimates and assumptions used in the presentation of our financial statements.  Our critical accounting policies include debt management and accounting for stock-based compensation.  We do not have off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as "special purpose entities".



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Item 3 - 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 4 - Controls and Procedures



Evaluation of Disclosure Controls and Procedures



Disclosure Controls



We carried out an evaluation required by Rule 13a-15(b) of the Securities Exchange Act of 1934 or the Exchange Act under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures.



Disclosure controls and procedures are designed with the objective of ensuring that (i) information required to be disclosed in an issuer's reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and (ii) information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.

The evaluation of our disclosure controls and procedures included a review of our objectives and processes and effect on the information generated for use in this Report. This type of evaluation is done quarterly so that the conclusions concerning the effectiveness of these controls can be reported in our periodic reports filed with the SEC. Our assessment of the internal controls in place during the quarter ended June 30, 2008 did not revealed any internal control deficiencies that when individually and collectively evaluated, may have a material effect in the timeliness and accuracy of financial information and therefore, did not warrant additional disclosure.  We have implemented the required processes and compensatory controls to minimize the risk in these areas and continue to develop those necessary as the business grows, and financial reporting becomes more complex. We intend to maintain these controls as processes that may be appropriately modified as circumstances warrant.

Based on their evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective in timely alerting them to material information, which is required to be included in our periodic reports filed with the SEC as of the filing of this Report.



Managements Report on Internal Control Over Financial Reporting



Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of the companys disclosures controls and procedures pursuant to exchange act rule 13a  15e our internal control over financial reporting as of December 31, 2007 based on the criteria set forth in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the criteria set forth in Internal Control  Integrated Framework, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures over financial reporting was effective as of September 30, 2008.



However, 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. Management necessarily applied its judgment in assessing the benefits of controls relative to their costs. Because of 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, within the company have been detected. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there



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can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. Because of the inherent limitations in a control system, misstatements due to error or fraud may occur and may not be detected.



Evaluation of Disclosure Controls and Procedures



PART II - OTHER INFORMATION

Item 1 - Legal Proceedings



None

Item 1A - Risk Factors

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 2 - Unregistered Sale of Equity Securities and Use of Proceeds



During the period covered by this report, we sold 38 units to 26 investors for $1,112,000 in gross proceeds.  Each unit consisted of 500,000 shares of common stock and a warrant to purchase 250,000 shares of common stock.  The purchase price of each unit was $50,000.  The warrants are exercisable at $0.25 per full share of common stock and expire twelve months from date of issuance.



The offering and sale qualified for exemption under Section 4(2) of the Securities Act of 1933 since the issuance did not involve a public offering.  The offering was not a public offering as defined in Section 4(2) because the offer and sale was made to an insubstantial number of persons and because of the manner of the offering. This offering was done with no general solicitation or advertising by the Registrant. Each investor made representations regarding his or her financial sophistication and had an opportunity to ask questions of our management. In addition, these investors had the necessary investment intent as required by Section 4(2) since they agreed to, and received, share certificates bearing a legend stating that such shares are restricted. This restriction ensures that these shares will not be immediately redistributed into the market and therefore not be part of a public offering. Based on an analysis of the above factors, the Registrant has met the requirements to qualify for exemption under Section 4(2) of the Securities Act of 1933 for this transaction.

Item 3 - Defaults upon Senior Securities



None

Item 4 - Submission of Matters to a Vote of Security Holders



None

Item 5 - Other Information



During the six-month period ended June 30, 2008, two board members resigned to the companys board of directors of directors. Mr. Robert J. Astore, Director and Mr. Salvatore Arnone resign to the board of directors and were replaced by Mr. Michael J. Kugler and Mr. Daniel P. Conte.



There have been no other changes in the board of directors in 2008.



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Item 6 - Exhibits



Exhibit 31.1 - Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (SOX)



Exhibit 31.2 - Certification of the Principal Financial Officer pursuant to Section 302 of SOX



Exhibit 32.1 - Certification of the Chief Executive Officer pursuant to Section 906 of SOX



Exhibit 32.2 - Certification of the Principal Financial Officer pursuant to Section 906 of SOX



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SIGNATURES







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







International Power Group, Ltd.



(Registrant)

|                        |                            
|----------------------- | ---------------------------
|                        |                            
|                       
|                       
|                        | /s/Peter Toscano           
|Date:
November 21, 2008 | Peter Toscano              
|                        | Principal Executive Officer
|                        |                            
|                        |                            
|                        |                            
|                        | /s/ Jesus Oliveras         
|Date:
November 21, 2008 | Jesus Oliveras             
|                        | Principal Financial Officer







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INDEX TO ATTACHED EXHIBITS









|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Exhibit 31.1- Certification Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-
14(a),Toscano

Exhibit 31.2- Certification Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-
14(a), Jesus Oliveras

Exhibit 32.1- Certification Required by Rule 13a-14(b) or Rule 15d-14(b) and section
906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, Toscano

Exhibit 32.2 - Certification Required by Rule 13a-14(b) or Rule 15d-14(b) and section
906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, Jesus Oliveras





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