UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________

FORM 10-Q

______________

(Mark One)

þQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2009

or

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

For the transition period from________ to ________



FIRST NATIONAL ENERGY CORPORATION

(Exact Name of Registrant as Specified in its Charter)





|                                                               |                        |                                     
|-------------------------------------------------------------- | ---------------------- | ------------------------------------
|Nevada                                                         | 333-62588              | 66-0349372                          
|(State or Other Jurisdiction
of Incorporation or Organization) | Commission
File Number | (I.R.S. Employer
Identification No.)



|                                         |           
|---------------------------------------- | ----------
|1551 Second Street, Sarasota, Florida    | 34236     
|(Address of Principal Executive Offices) | (Zip Code)

(416) 918-6987

Registrants Telephone Number, Including Area Code



(Former Name, Former Address, and Former Fiscal Year, if Changed Since Last Report)



Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES þ  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  þ
|(do not check if a smaller reporting company) |  |                             

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES  ̈  NO þ

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.

As of November 2, 2009, there were 99,665,228 common shares issued and outstanding.







---

FIRST NATIONAL ENERGY CORPORATION

INDEX

PART IFINANCIAL INFORMATION

|                                                                                                                                                                   |  |      
|------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -----
|Interim Balance Sheets as at September 30, 2009 (unaudited) and December 31, 2008 (audited)                                                                        |  | 1    
|Interim Statements of Operations for the 9 month periods ended September 30, 2009 and September 30, 2008 and for the cumulative period since inception (unaudited) |  | 2    
|Interim Statements of Operations for the 3 month periods ended September 30, 2009 and September 30, 2008                                                           |  | 3    
|Interim Statements of Cash Flows for the 9 month periods ended September 30, 2009 and September 30, 2008 and for the cumulative period since inception (unaudited) |  | 4    
|Interim Statements of Changes in Stockholders Deficiency for the period since inception (unaudited)                                                               |  | 5 - 7
|Condensed Notes to Interim Financial Statements (unaudited)                                                                                                        |  | 8 - 9



---



First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Financial Statements (unaudited)

For the 9 Month period ended September 30, 2009

Amounts expressed in US Dollars











---

PART IFINANCIAL INFORMATION

Item 1.

Financial Statements.

First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Balance Sheets

As of September 30, 2009 and December 31, 2008

(Amounts expressed in US Dollars)

|                                                          |  |                   |           |   |                  |  |          |  
|--------------------------------------------------------- |  | ----------------- | --------- | - | ---------------- |  | -------- | -
|                                                          |  | September 30
2009 |           |   | December 31
2008 | 
|                                                          |  |                   | $         |   |                  |  | $        |  
|ASSETS                                                    |  |                   |           |   |                  |  |          |  
|CURRENT ASSETS                                            |  |                   |           |   |                  |  |          |  
|Cash                                                      |  |                   | 40,546    |   |                  |  | 85,122   |  
|                                                          |  |                   | 40,546    |   |                  |  | 85,122   |  
|                                                          |  |                   |           |   |                  |  |          |  
|License for SWEG technology, net of amortization (Note 2) |  |                   | 1,778,288 |   |                  |  |          |  
|                                                          |  |                   | 1,818,834 |   |                  |  | 85,122   |  
|                                                          |  |                   |           |   |                  |  |          |  
|LIABILITIES                                               |  |                   |           |   |                  |  |          |  
|CURRENT LIABILITIES                                       |  |                   |           |   |                  |  |          |  
|Accounts payable and accrued liabilities                  |  |                   | 5,000     |   |                  |  | 13,829   |  
|Loans from shareholders                                   |  |                   | 258,313   |   |                  |  | 258,313  |  
|                                                          |  |                   | 263,313   |   |                  |  | 272,142  |  
|                                                          |  |                   |           |   |                  |  |          |  
|Going Concern (Note 1)                                    |  |                   |           |   |                  |  |          |  
|                                                          |  |                   |           |   |                  |  |          |  
|STOCKHOLDERS DEFICIENCY                                  |  |                   |           |   |                  |  |          |  
|                                                          |  |                   |           |   |                  |  |          |  
|Capital Stock                                             |  |                   | 99,665    |   |                  |  | 76,524   |  
|Additional Paid-in Capital                                |  |                   | 2,185,801 |   |                  |  | 321,337  |  
|Deficit, Accumulated During the Development Stage         |  |                   | (729,945  | ) |                  |  | (584,881 | )
|                                                          |  |                   | 1,555,521 |   |                  |  | (187,020 | )
|                                                          |  |                   | 1,818,834 |   |                  |  | 85,122   |  









1



---

First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Statements of Operations

For the 9-month periods ended September 30, 2009 and 2008

(Amounts expressed in US Dollars)



|                                           |  |                            |          |   |                                  |   |            |                                  |  |   |         |  
|------------------------------------------ |  | -------------------------- | -------- | - | -------------------------------- | - | ---------- | -------------------------------- |  | - | ------- | -
|                                           |  | Cumulative
Since
Inception |          |   | 9-Months
Ended
September 30
2009 |   |            | 9-Months
Ended
September 30
2008 | 
|                                           |  | $                          |          |   | $                                |   |            | $                                | 
|OPERATING EXPENSES                         |  |                            |          |   |                                  |   |            |                                  |  |   |         |  
|                                           |  |                            |          |   |                                  |   |            |                                  |  |   |         |  
|Interest Income                            |  |                            | (6,973   | ) |                                  |   | (74        | )                                |  |   | (1,669  | )
|                                           |  |                            |          |   |                                  |   |            |                                  |  |   |         |  
|Forgiveness of accounts payable and loans  |  |                            | (47,394  | ) |                                  |   |            |                                  |  |   |         |  
|General and administrative expenses        |  |                            | 430,332  |   |                                  |   | 67,821     |                                  |  |   | 19,944  |  
|Loss on Foreign Exchange                   |  |                            | 580      |   |                                  |   |           |                                  |  |   |        |  
|Project development costs                  |  |                            | 272,857  |   |                                  |   |           |                                  |  |   | 35,326  |  
|Amortization                               |  |                            | 77,317   |   |                                  |   | 77,317     |                                  |  |   |         |  
|Interest Expense                           |  |                            | 3,226    |   |                                  |   |           |                                  |  |   |        |  
|                                           |  |                            | 729,945  |   |                                  |   | (145,064   | )                                |  |   | 53,601  |  
|                                           |  |                            |          |   |                                  |   |            |                                  |  |   |         |  
|NET LOSS                                   |  |                            | (729,945 | ) |                                  |   | (145,064   | )                                |  |   | (53,601 | )
|                                           |  |                            |          |   |                                  |   |            |                                  |  |   |         |  
|Net loss per share, basic and diluted      |  |                            |          |   |                                  | $ | (0.00      | )                                |  | $ | (0.07   | )
|                                           |  |                            |          |   |                                  |   |            |                                  |  |   |         |  
|Weighted average common shares outstanding |  |                            |          |   |                                  |   | 47,495,631 |                                  |  |   | 764,228 |  





2



---

First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Statements of Operations

For the 3-month periods ended September 30, 2009 and 2008

(Amounts expressed in US Dollars)

|                                           |  |                                  |            |   |                                  |   |         |  
|------------------------------------------ |  | -------------------------------- | ---------- | - | -------------------------------- | - | ------- | -
|                                           |  | 3-Months
Ended
September 30
2009 |            |   | 3-Months
Ended
September 30
2008 |  
|                                           |  | $                                |            |   | $                                |  
|OPERATING EXPENSES                         |  |                                  |            |   |                                  |   |         |  
|                                           |  |                                  |            |   |                                  |   |         |  
|Interest Income                            |  |                                  | (10        | ) |                                  |   | (398    | )
|                                           |  |                                  |            |   |                                  |   |         |  
|Forgiveness of accounts payable and loans  |  |                                  |            |   |                                  |   |         |  
|General and administrative expenses        |  |                                  | 4,659      |   |                                  |   | 4,251   |  
|Project development costs                  |  |                                  |           |   |                                  |   | 5,000   |  
|Amortization                               |  |                                  | 46,390     |   |                                  |   |         |  
|                                           |  |                                  | (51,039    | ) |                                  |   | 8,853   |  
|                                           |  |                                  |            |   |                                  |   |         |  
|                                           |  |                                  |            |   |                                  |   |         |  
|NET LOSS                                   |  |                                  | (51,039    | ) |                                  |   | (8,853  | )
|                                           |  |                                  |            |   |                                  |   |         |  
|Net loss per share, basic and diluted      |  | $                                | (0.00      | ) |                                  | $ | (0.01   | )
|                                           |  |                                  |            |   |                                  |   |         |  
|Weighted average common shares outstanding |  |                                  | 99,665,228 |   |                                  |   | 764,228 |  





3



---

First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Statements of Cash Flows

For the 9-month periods ended September 30, 2009 and 2008

(Amounts expressed in US Dollars)

|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|--------------------------------------------------------------- |  | -------------------------- | -------- | -------------------------------- |  | -------------------------------- | - |  | ------- | -
|                                                                |  | Cumulative
Since
Inception |          | 9-Months
Ended
September 30
2009 |  | 9-Months
Ended
September 30
2008 |  
|                                                                |  | $                          |          | $                                |  | $                                |  
|CASH FLOWS FROM OPERATING ACTIVITIES                            |  |                            |          |                                  |  |                                  |   |  |         |  
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|Net loss                                                        |  |                            | (729,945 | )                                |  | (145,064                         | ) |  | (53,601 | )
|Adjustments for items not affecting cash                        |  |                            |          |                                  |  |                                  |   |  |         |  
|Amortization                                                    |  |                            | 77,317   |                                  |  | 77,317                           |   |  |         |  
|Shares issued for services rendered                             |  |                            | 332,390  |                                  |  | 32,000                           |   |  |         |  
|Forgiveness of accounts payable and loans                       |  |                            | (47,394  | )                                |  |                                  |   |  |         |  
|Increase in project deposits                                    |  |                            |          |                                  |  |                                  |   |  | (10,000 | )
|Increase (decrease) in accounts payable and accrued liabilities |  |                            | 8,999    |                                  |  | (8,829                           | ) |  | (1,132  | )
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|Net cash used in operating activities                           |  |                            | (358,633 | )                                |  | (44,576                          | ) |  | (64,733 | )
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|CASH FLOWS FROM FINANCING ACTIVITIES                            |  |                            |          |                                  |  |                                  |   |  |         |  
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|Loans from Shareholders                                         |  |                            | 301,708  |                                  |  |                                 |   |  |         |  
|Proceeds from sale of capital stock                             |  |                            | 97,471   |                                  |  |                                  |   |  |         |  
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|Net cash provided by financing activities                       |  |                            | 399,179  |                                  |  |                                 |   |  |        |  
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|NET INCREASE (DECREASE) IN CASH                                 |  |                            | 40,546   |                                  |  | (44,576                          | ) |  | (64,733 | )
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|Cash, beginning of period                                       |  |                            |         |                                  |  | 85,122                           |   |  | 158,313 |  
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|CASH, END OF PERIOD                                             |  |                            | 40,546   |                                  |  | 40,546                           |   |  | 93,580  |  
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|INCOME TAXES PAID                                               |  |                            |         |                                  |  |                                 |   |  |        |  
|                                                                |  |                            |          |                                  |  |                                  |   |  |         |  
|INTEREST PAID                                                   |  |                            | 3,226    |                                  |  |                                 |   |  |        |  





4



---

First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Statements of Changes in Stockholders Deficiency

From Inception until September 30, 2009

(Amounts expressed in US Dollars)

|                                                |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   |         |   |   |         |  
|----------------------------------------------- |  | ------------------- | ----- | ----------------------------- |  | ----------------------- |  | ------------------------------------- | - | ------------------------------------------------ | - | ------------------------------------- |  | - | ------- | - | - | ------- | -
|                                                |  | Common
Stock
Amount |       | Common
Stock Number
of Shares |  | Common
Stock
Subscribed |  | Additional
Paid-in
Capital
(Discount) |   | Deficit
Accumulated
during the
development
stage |   | Total
Shareholder
Equity
(Deficiency) | 
|                                                |  | $                   |       |                               |  |                         |  | $                                     |   |                                                  | $ |                                       |  | $ |         |   | $ |         |  
|Balance at November 16, 2000                    |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   |         |   |   |         |  
|Issuance of common stock for cash               |  |                     | 100   |                               |  | 100,000                 |  |                                       |   |                                                  |   | 900                                   |  |   |         |   |   | 1,000   |  
|Net Loss for the Period                         |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   | (968    | ) |   | (968    | )
|                                                |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   |         |   |   |         |  
|Balance as of December 31, 2000                 |  |                     | 100   |                               |  | 100,000                 |  |                                       |  |                                                  |   | 900                                   |  |   | (968    | ) |   | 32      |  
|                                                |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   |         |   |   |         |  
|Issuance of stock for cash                      |  |                     | 400   |                               |  | 400,000                 |  |                                       |   |                                                  |   | 3,600                                 |  |   |         |   |   | 4,000   |  
|Issuance of stock for cash                      |  |                     | 700   |                               |  | 700,000                 |  |                                       |   |                                                  |   | 6,300                                 |  |   |         |   |   | 7,000   |  
|Issuance of stock for cash                      |  |                     | 850   |                               |  | 850,000                 |  |                                       |   |                                                  |   | 7,650                                 |  |   |         |   |   | 8,500   |  
|Currency Translation                            |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   | 100                                   |  |   |         |   |   | 100     |  
|Net Loss for the Year                           |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   | (23,954 | ) |   | (23,954 | )
|                                                |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   |         |   |   |         |  
|Balance as of December 31, 2001                 |  |                     | 2,050 |                               |  | 2,050,000               |  |                                       |  |                                                  |   | 18,550                                |  |   | (24,922 | ) |   | (4,322  | )
|                                                |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   |         |   |   |         |  
|Expiration of recission offer for sale of stock |  |                     | 64    |                               |  | 63,536                  |  |                                       |   |                                                  |   | 6,290                                 |  |   |         |   |   | 6,354   |  
|Net Loss for the Year                           |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   | (26,047 | ) |   | (26,047 | )
|                                                |  |                     |       |                               |  |                         |  |                                       |   |                                                  |   |                                       |  |   |         |   |   |         |  
|Balance as of December 31, 2002                 |  |                     | 2,114 |                               |  | 2,113,536               |  |                                       |  |                                                  |   | 24,840                                |  |   | (50,969 | ) |   | (24,015 | )







5



---

First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Statements of Changes in Stockholders Deficiency

From Inception until September 30, 2009

(Amounts expressed in US Dollars)

|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|-------------------------------------- |  |  | ------ |  |  | ---------- |  |  | ---- | - |  | ------- | - |  | -------- | - |  | -------- | -
|Stock split 5:1                        |  |  | 8,454  |  |  | 8,454,144  |  |  |      |   |  | (8,454  | ) |  |          |   |  |         |  
|Shares issued for services rendered    |  |  | 200    |  |  | 200,000    |  |  |      |   |  | 79,800  |   |  |          |   |  | 80,000   |  
|Net Loss for the Year                  |  |  |        |  |  |            |  |  |      |   |  |         |   |  | (107,245 | ) |  | (107,245 | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Balance as of December 31, 2003        |  |  | 10,768 |  |  | 10,767,680 |  |  |     |   |  | 96,186  |   |  | (158,214 | ) |  | (51,260  | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Stock split 7:1                        |  |  | 64,606 |  |  | 64,606,080 |  |  |      |   |  | (64,606 | ) |  |          |   |  |         |  
|Shares issued for services rendered    |  |  | 30     |  |  | 30,000     |  |  |      |   |  | 15,870  |   |  |          |   |  | 15,900   |  
|Shares subscribed                      |  |  |        |  |  |            |  |  | 146  |   |  | 70,371  |   |  |          |   |  | 70,517   |  
|Shares issued for services rendered    |  |  | 44     |  |  | 43,000     |  |  |      |   |  | 9,956   |   |  |          |   |  | 10,000   |  
|Net Loss for the Year                  |  |  |        |  |  |            |  |  |      |   |  |         |   |  | (75,414  | ) |  | (75,414  | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Balance as of December 31, 2004        |  |  | 75,448 |  |  | 75,446,760 |  |  | 146  |   |  | 127,777 |   |  | (233,628 | ) |  | (30,257  | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Shares issued for services rendered    |  |  | 830    |  |  | 830,000    |  |  |      |   |  | 193,160 |   |  |          |   |  | 193,990  |  
|Net Loss for the Year                  |  |  |        |  |  |            |  |  |      |   |  |         |   |  | (208,886 | ) |  | (208,886 | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Balance as of December 31, 2005        |  |  | 76,278 |  |  | 76,276,760 |  |  | 146  |   |  | 320,937 |   |  | (442,514 | ) |  | (45,153  | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Net Loss for the Year                  |  |  |        |  |  |            |  |  |      |   |  |         |   |  | (32,962  | ) |  | (32,962  | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Balance as of December 31, 2006        |  |  | 76,278 |  |  | 76,276,760 |  |  | 146  |   |  | 320,937 |   |  | (475,476 | ) |  | (78,115  | )
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Net Loss for the Year                  |  |  |        |  |  |            |  |  |      |   |  |         |   |  | (30,760  | ) |  | (30,760  | )
|Issue shares bought under subscription |  |  | 146    |  |  | 146,000    |  |  | (146 | ) |  |         |   |  |          |   |  |         |  
|                                       |  |  |        |  |  |            |  |  |      |   |  |         |   |  |          |   |  |          |  
|Balance as of December 31, 2007        |  |  | 76,424 |  |  | 76,422,760 |  |  |     |   |  | 320,937 |   |  | (506,236 | ) |  | (108,875 | )







6



---

First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Statements of Changes in Stockholders Deficiency

From Inception until September 30, 2009

(Amounts expressed in US Dollars)

|                                    |  |  |         |   |  |             |   |  |   |  |  |           |  |  |          |   |  |           |  
|----------------------------------- |  |  | ------- | - |  | ----------- | - |  | - |  |  | --------- |  |  | -------- | - |  | --------- | -
|Shares issued for services rendered |  |  | 100     |   |  | 100,000     |   |  |   |  |  | 400       |  |  |          |   |  | 500       |  
|Net Loss for the Year               |  |  |         |   |  |             |   |  |   |  |  |           |  |  | (78,645  | ) |  | (78,645   | )
|                                    |  |  |         |   |  |             |   |  |   |  |  |           |  |  |          |   |  |           |  
|Balance as of December 31, 2008     |  |  | 76,524  |   |  | 76,522,760  |   |  |  |  |  | 321,337   |  |  | (584,881 | ) |  | (187,020  | )
|                                    |  |  |         |   |  |             |   |  |   |  |  |           |  |  |          |   |  |           |  
|Stock split 1:100                   |  |  | (75,759 | ) |  | (75,757,532 | ) |  |   |  |  | 75,759    |  |  |          |   |  |          |  
|Shares issued for services rendered |  |  | 100     |   |  | 100,000     |   |  |   |  |  | 31,900    |  |  |          |   |  | 32,000    |  
|Purchase of SWEG license for shares |  |  | 98,800  |   |  | 98,800,000  |   |  |   |  |  | 1,756,805 |  |  |          |   |  | 1,855,605 |  
|Net Loss for the Period             |  |  |         |   |  |             |   |  |   |  |  |           |  |  | (145,064 | ) |  | (145,064  | )
|                                    |  |  |         |   |  |             |   |  |   |  |  |           |  |  |          |   |  |           |  
|Balance as of September 30, 2009    |  |  | 99,665  |   |  | 99,665,228  |   |  |  |  |  | 2,185,801 |  |  | (729,945 | ) |  | 1,555,521 |  









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First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Condensed Notes to the Interim Financial Statements

For the 9 months ended September 30, 2009 (unaudited)

Amounts expressed in US Dollars







NOTES TO INTERIM FINANCIAL STATEMENTS

The accompanying unaudited interim financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of all recurring accruals considered necessary for fair presentation) have been included as necessary in order to make the financial statements not misleading. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the year ended December 31, 2009. Interim financial statements should be read in conjunction with the Companys annual audited financial statements.

The Company has reviewed subsequent events up to October 27, 2009

1.

Organization and Basis of Presentation

Description of the Business

First National Energy Corporation (the Company) was incorporated in the State of Delaware on November 16, 2000, with the name Capstone International Corporation. On March 28, 2004, the Company changed its name to First National Power Corporation. On February 12, 2009, the Company relocated its charter to the State of Nevada and changed its name to First National Energy Corporation. As part of reorganization, the Company increased its authorized capital to 300 million common shares and effected a 100 for 1 reverse stock split of its issued and outstanding shares of common stock. The accompanying financial statements reflect all share data based on the 100 for 1 reverse common stock split.

The Company was initially engaged in the business of reselling pre-paid funeral insurance and annuity products. In the first quarter of 2004, the Company changed its business purpose to provision of wind-driven solutions for power generation. Current projects for the Company are the completion of power generation projects from bio-mass technologies.

Going Concern

The Companys financial statements are prepared using accounting principles generally accepted in the United States of America and applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has not generated any revenues from its planned principal operations through September 30, 2009, has recorded losses since inception and has negative working capital. These conditions raise substantial doubt about the Companys ability to continue as a going concern. The financial statements do not include any adjustments that might result from this uncertainty.

2.

Purchase of Technology License

On April 20, 2009, the Company entered into a preliminary letter of intent with Boreas Research Corporation (Boreas), a Florida corporation, pursuant to which the Company would acquire a territorial license to certain rights in alternative energy technology of Boreas, in exchange for a quantity of newly issued common shares of the Company. Such letter of intent was superseded by a Technology License and Stock Purchase Agreement (the Agreement) between the Company and Boreas that was consummated on May 25, 2009 (the Closing), at which time the Company issued the stockholders of Boreas 98,800,000 new restricted and unregistered common shares of the Company and agreed to pay certain future royalties to Boreas from net revenues realized by the Company from the technology license. The consideration issued in the transaction was determined as a result of arms-length negotiations between the parties.



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First National Energy Corporation

(Formerly First National Power Corporation)

(A Development Stage Company)

Condensed Notes to the Interim Financial Statements

For the 9 months ended September 30, 2009 (unaudited)

Amounts expressed in US Dollars







The preliminary letter of intent was reported by the Company on form 8-K to the Securities and Exchange Commission (SEC) on April 21, 2009, and the Agreement was annexed to an information statement on form 14-C filed with the SEC in preliminary and definitive forms on April 22, 2009 and May 4, 2009, respectively. The definitive information statement was mailed to the shareholders of the Company on May 4, 2009.

The Company obtained written consent to the Agreement and the transaction from the holders of 55.82% of its issued and outstanding shares of common stock in lieu of a meeting of stockholders.

On May 14, 2009, the Company and Boreas amended the Agreement by making and entering into that certain First Amendment of Technology License and Stock Purchase Agreement (the Amendment), pursuant to which (1) Boreas elected, as authorized by the Agreement, to cause the new restricted and unregistered common shares of the Company due to Boreas at the Closing to be issued to the stockholders of Boreas, and (2) the Company and Boreas agreed to reduce the number of new restricted and unregistered common shares of the Company to be issued at the closing of the transaction, from 98,915,000 shares to 98,800,000 shares.

In exchange for the Company acquiring a technology license from Boreas at the Closing pursuant to the Agreement (as amended by the Amendment), the shareholders of Boreas received an aggregate of 98,800,000 new restricted and unregistered common shares of the Company's common stock. Accordingly, the Boreas Shareholders now own 99.13% of the Company's 99,665,228 outstanding shares. No finders fees were paid or consulting agreements entered into by the Company in connection with the transaction.

The Company has valued the technology license received from Boreas at the Closing on the books of the Company at $1,855,605 after consulting with an outside valuation expert.

Also upon the Closing, Mr. Peter Wanner, then the sole member of the Companys board of directors, appointed Douglas Lindeblom and Gianni Caputo to vacant positions on the Companys board of directors, and the new board of directors, as so constituted, elected the following officers:

Douglas Lindeblom - Chairman, Chief Executive Officer and President

Peter Wanner - Chief Operating Officer, Treasurer and Chief Financial Officer

Gianni Caputo - Vice President and Secretary

Prior to the transaction, there were no material relationships between the Company and Boreas, between Boreas and the Companys affiliates, directors or officers, or between any associates of Boreas and the Companys officers or directors. All of the Companys transaction liabilities were settled on or immediately following the Closing.

Upon the Closing on May 25, 2009, the Company was no longer deemed to be a "shell company" as defined in Rule 12b-2 under the Securities Exchange Act of 1934 (the "Exchange Act"). Accordingly, the Company filed an amended current report on Form 8-K/A with the SEC on May 26, 2009, setting forth the information that would be required if the Company were filing a general form for registration of securities on Form 10 under the Exchange Act.





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Item 2.

Managements Discussion and Analysis of Financial Condition and Results of Operations.

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION

Certain statements in this annual report on Form 10-Q contain or may contain forward-looking statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to consummate a merger or business combination, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk, U.S. and global competition, and other factors. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Readers should carefully review this annual report in its entirety, including but not limited to our financial statements and the notes thereto. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. For any forward-looking statements contained in any document, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

Description of Business

Business Development

First National Energy Corporation (the Registrant) was incorporated as Capstone International Corporation on November 16, 2000, in the state of Delaware, and has a class of shares registered with the Securities and Exchange Commission on Form SB-2 as SEC File No. 333-62588, filed on September 8, 2001. The Registrants name was changed to First National Power Corporation on January 28, 2004, and was changed again to First National Energy Corporation on February 12, 2009, at which time the Registrant effected a reverse stock split, adopted a holding company structure, and relocated its corporate charter from Delaware to Nevada as part of a reorganization that resulted in a change in the Registrants stock symbol from FNPR to FNEC.

On April 20, 2009, the Registrant acquired a territorial license to certain rights in alternative wind energy technology in exchange for 98,800,000 newly issued common shares of the Registrant, which resulted in a change in control of the Registrant. The Registrant has valued the technology license received in such transaction at $1,855,605 after consulting with an outside valuation expert. As a result of such transaction, the Registrant is no longer deemed to be a "shell company" as defined in Rule 12b-2 under the Securities Exchange Act of 1934.

Business of Issuer

Since acquiring the technology license described above, management of the Registrant has expended significant time in seeking sources of capital to implement its business plan, which is primarily designed to exploit the licensed technology throughout the United States and Canada for commercial gain. The Registrant is also evaluating other alternatives in order to improve the Registrant's financial condition, including merger and acquisition opportunities. There is no assurance that the Registrant will be successful in raising capital or closing any such merger or acquisition transactions.

Except as described above and as more particularly described in the Registrants accompanying interim financial statements, there have been no other material changes in the registrants financial condition from the end of the preceding fiscal year to the date of the interim balance sheet provided herein, nor have there been any other material changes in the registrants financial condition during the period ending on the date of the interim balance sheet provided herein and commencing on the corresponding interim date of the preceding fiscal year.







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Except as described above and as more particularly described in the Registrants accompanying interim financial statements, there have been no material changes in the registrant's results of operations with respect to the most recent fiscal year-to-date period for which an income statement is provided and the corresponding year-to-date period of the preceding fiscal year.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

(Not applicable)

Item 4.

Controls and Procedures.

As of September 30, 2009, the Registrant carried out an evaluation of the effectiveness of the Registrants disclosure controls and procedures (as defined by Rule 13a-15(e) under the Securities Exchange Act of 1934) under the supervision and with the participation of the Registrants chief executive and chief financial officer. Based on and as of the date of such evaluation, the aforementioned officer has concluded that the Registrants disclosure controls and procedures were not effective.

The Registrant also maintains a system of internal accounting controls that is designed to provide assurance that assets are safeguarded and that transactions are executed in accordance with managements authorization and properly recorded. This system is continually reviewed and is augmented by written policies and procedures, the careful selection and training of qualified personnel and an internal audit program to monitor its effectiveness. During the interim period ended September 30, 2009, there were no changes to this system of internal controls or in other factors that could significantly affect those controls.

Item 4T.

Controls and Procedures.

(a)

Managements Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Internal control over financial reporting refers to a process designed by, or under the supervision of our Chief Financial Officer and effected by our Board, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in connection with generally accepted accounting principles, including those policies and procedures that:

·

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

·

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

·

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

Because of its inherent limitations, internal control over financial reporting cannot provide absolute assurance of the prevention or detection of misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

(b)

Changes in Internal Control over Financial Reporting.

In connection with the preparation of the Registrants Annual Report on Form 10-KSB for the year ended December 31, 2008, management, with the participation of our Chief Financial Officer, evaluated the effectiveness of our internal controls over financial reporting, pursuant to Rule 13a-15 under the Exchange Act. Management conducted its evaluation of the Registrants internal control over financial reporting based on the framework in Internal Control  Integrated Framework,issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In the course of making our assessment of the effectiveness of internal controls over



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financial reporting, we identified one material weakness in our internal control over financial reporting. This material weakness consisted of inadequate staffing within the accounting operations of our company. The small number of employees who are responsible for accounting functions (more specifically, one) prevents us from segregating duties within our internal control system. The inadequate segregation of duties is a weakness because it could lead to the untimely identification and resolution of accounting and disclosure matters or could lead to a failure to perform timely and effective reviews. There have been no changes in our internal controls over financial reporting that occurred during the third fiscal quarter of 2009 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.





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PART IIOTHER INFORMATION

Item 1.

Legal Proceedings

The Registrant is not a party to any pending or threatened legal proceedings.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

The Registrant has not sold any unregistered equity securities during the period covered by this report.

Item 3.

Defaults Upon Senior Securities.

Not Applicable.

Item 4.

Submission of Matters to a Vote of Security Holders.

No matters have been submitted to a vote of security holders during the period covered by this report.

Item 5.

Other Information.

(Not Applicable)

Item 6.

Exhibits.



|            |  |                                                                                                                                                                                                               
|----------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Document                                                                                                                                                                                                      
|31*         |  | Sect. 302 Certification Statement of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                        
|32*         |  | Sect. 906 Certification Statement of the Principal Executive Officer and Principal Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002



*

Filed herewith



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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.



|       |                  |     |                                   |                                                                  
|------ | ---------------- | --- | --------------------------------- | -----------------------------------------------------------------
|       |                  |     | FIRST NATIONAL ENERGY CORPORATION
|       |                  |     |                                   |                                                                  
|Dated: | November 3, 2009 | By: | /s/ PETERWANNER                  
|       |                  |     |                                   | Peter Wanner, Chief Executive Officer and
Chief Financial Officer





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