----

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|  Nevada                                                         |   | 66-0349372                           |
|----------------------------------------------------------------------|--------|--------------------------------------|
| (State or other jurisdiction of incorporation or organization)  |   | (I.R.S. Employer Identification No.) |

|  Large accelerated filer                                 |  o |  Accelerated filer    |  o      |
|--------------------------------------------------------------------|---------|---------------------------------|--------------|
| Non-accelerated filer(do not check if a smaller reporting company) |  o | Smaller reporting company  |  þ |

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|                                                                                                                                                                                           |   |   |       |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|------------|
| Consolidated Interim Balance Sheets as at March 31, 2011 (unaudited) and December 31, 2010 (audited)                                                                                           |   |   | 3          |   |
|                                                                                                                                                                                           |   |   |       |   |
| Consolidated Interim Statements of Operations and Comprehensive Loss for the 3-month periods ended March 31, 2011 and March 31, 2010 and for the cumulative period since inception (unaudited) |   |   | 4          |   |
|                                                                                                                                                                                           |   |   |       |   |
| Consolidated Interim Statements of Cash Flows for the 3-month periods ended March 31, 2011 and March 31, 2010 and for the cumulative period since inception (unaudited)                        |   |   | 5          |   |
|                                                                                                                                                                                           |   |   |       |   |
| Consolidated Interim Statements of Stockholders’ Equity (Deficiency) for the period since inception to March 31, 2011 (unaudited)                                                        |   |   | 6 - 9 |   |
|                                                                                                                                                                                           |   |   |       |   |
| Condensed Notes to Consolidated Interim Financial Statements (unaudited)                                                                                                                       |   |   | 10         |   |

----

| FIRST NATIONAL ENERGY CORPORATION                          |   |
|------------------------------------------------------------|--------|
| (Formerly First National Power Corporation)                |   |
| (A Development Stage Company)                              |   |
| Consolidated Interim Balance Sheets                        |   |
| As of December 31, 2011 and 2010                           |   |
| (Amounts expressed in US Dollars)                          |   |
|                                                       |   |
|                                                       |   | March 31, |   |   | December 31, |   |
|                                                       |   | 2011 |   |   | 2010 |   |
|                                                       |   |   |   |   |   |   |
|                                                       |   | $ |   |   | $ |   |
|  ASSETS                                               |   |   |   |   |   |   |   |   |
|       CURRENT ASSETS         |   |   |   |   |   |   |   |   |
|  Cash                                                 |   |   | 10,098 |   |   |   | 14,988 |   |
|                                                       |   |   |   |   |   |   |   |   |
|  License for SWEG technology (Note 4)                 |   |   | 200 |   |   |   | 200 |   |
|                                                       |   |   |   |   |   |   |   |   |
|                                                       |   |   | 10,298 |   |   |   | 15,188 |   |
|                                                       |   |   |   |   |   |   |   |   |
|                                                       |   |   |   |   |   |   |   |   |
|  LIABILITIES                                          |   |   |   |   |   |   |   |   |
|      CURRENT LIABILITIES          |   |   |   |   |   |   |   |   |
|  Accounts payable and accrued liabilities (Note 5)    |   |   | 15,669 |   |   |   | 13,269 |   |
|  Loan payable to Boreas Research Corporation (Note 8) |   |   | 540,000 |   |   |   | 540,000 |   |
|                                                       |   |   | 555,669 |   |   |   | 553,269 |   |
|                                                       |   |   |   |   |   |   |   |   |
|  Going Concern (Note 2)                               |   |   |   |   |   |   |   |   |
|  Other Contingent Liabilities (Note 12)               |   |   |   |   |   |   |   |   |
|                                                       |   |   |   |   |   |   |   |   |
|  STOCKHOLDERS’ EQUITY (DEFICIENCY)              |   |   |   |   |   |   |   |   |
|                                                       |   |   |   |   |   |   |   |   |
|  Capital Stock (Note 7)                               |   |   | 99,765 |   |   |   | 99,765 |   |
|  Additional paid-in Capital                           |   |   | 103,329 |   |   |   | 103,329 |   |
|  Deficit accumulated during the development stage     |   |   | (748,539 | ) |   |   | (741,249 | ) |
|  Total FNEC Stockholders' Equity (Deficit)            |   |   | (545,445 | ) |   |   | (538,155 | ) |
|  Non-controlling interest                             |   |   | 74 |   |   |   | 74 |   |
|                                                       |   |   | (545,371 | ) |   |   | (538,081 | ) |
|                                                       |   |   |   |   |   |   |   |   |
|                                                       |   |   | 10,298 |   |   |   | 15,188 |   |

----

| FIRST NATIONAL ENERGY CORPORATION                                                               |   |
|-------------------------------------------------------------------------------------------------|--------|
| (Formerly First National Power Corporation)                                                     |   |
| (A Development Stage Company)                                                                   |   |
| Consolidated Interim Statements of Operations and Comprehensive Loss                            |   |
| For the 3 month periods ended March 31, 2011 and 2010 and the cumulative period since inception |   |
| (Amounts expressed in US Dollars)                                                               |   |
|                                                                                            |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |
|                                                                                            |   | Cumulative |   |   |   |   |   |   |   |
|                                                                                            |   | Since |   |   |   |   |   |   |   |
|                                                                                            |   | Inception |   |   | 2011 |   |   | 2010 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |
|                                                                                            |   | $ |   |   | $ |   |   | $ |   |
| OPERATING EXPENSES                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Income                                                                                 |   |   | (6,924 | ) |   |   | - |   |   |   | (12 | ) |
| Forgiveness of accounts payable and loans                                                       |   |   | (47,394 | ) |   |   | - |   |   |   | - |   |
| General and administrative expenses                                                             |   |   | 510,840 |   |   |   | 6,730 |   |   |   | 3,670 |   |
| Loss on foreign exchange                                                                        |   |   | 580 |   |   |   | - |   |   |   | - |   |
| Project development costs                                                                       |   |   | 288,237 |   |   |   | 560 |   |   |   | - |   |
| Interest Expense                                                                                |   |   | 3,226 |   |   |   | - |   |   |   | - |   |
| NET LOSS                                                                                        |   |   | 748,565 |   |   |   | 7,290 |   |   |   | 3,658 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss attributable to non-controlling interest                                               |   |   | (26 | ) |   |   | - |   |   |   | - |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss attributable to FNEC Stockholders                                                      |   |   | 748,539 |   |   |   | 7,290 |   |   |   | 3,658 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss per share, basic and diluted                                                           |   |   |   |   |   | $ | 0.00 |   |   | $ | 0.00 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average common shares outstanding                                                      |   |   |   |   |   |   | 99,746,598 |   |   |   | 99,665,228 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| COMPREHENSIVE LOSS                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Loss                                                                                        |   |   | 748,565 |   |   |   | 7,290 |   |   |   | 3,658 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Other Comprehensive Loss                                                                        |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive Loss                                                                              |   |   | 748,565 |   |   |   | 7,290 |   |   |   | 3,658 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive Loss attributable to non-controlling interest                                     |   |   | - |   |   |   | - |   |   |   | - |   |
| Comprehensive Loss attributable to FNEC Stockholders                                            |   |   | 748,565 |   |   |   | 7,290 |   |   |   | 3,658 |   |

----

| FIRST NATIONAL ENERGY CORPORATION                                                               |   |
|-------------------------------------------------------------------------------------------------|--------|
| (Formerly First National Power Corporation)                                                     |   |
| (A Development Stage Company)                                                                   |   |
| Consolidated Interim Statements of Cash Flows                                                   |   |
| For the 3 month periods ended March 31, 2011 and 2010 and the cumulative period since inception |   |
| (Amounts expressed in US Dollars)                                                               |   |
|                                                                                            |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |
|                                                                                            |   | Cumulative |   |   |   |   |   |   |   |
|                                                                                            |   | Since |   |   |   |   |   |   |   |
|                                                                                            |   | Inception |   |   | 2011 |   |   | 2010 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |
|                                                                                            |   | $ |   |   | $ |   |   | $ |   |
| CASH FLOWS FROM OPERATING ACTIVITIES                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net loss                                                                                  |   |   | (748,565 | ) |   |   | (7,290 | ) |   |   | (3,658 | ) |
|  Adjustments for items not affecting cash                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|  Shares issued for services rendered                                                       |   |   | 347,210 |   |   |   | - |   |   |   | - |   |
|  Shares issued for debt forgiveness                                                        |   |   | (258,313 | ) |   |   | - |   |   |   |   |   |
|  Forgiveness of accounts payable and loans                                                 |   |   | (47,394 | ) |   |   | - |   |   |   | - |   |
|  Increase (decrease) in accounts payable                                                   |   |   | - |   |   |   | - |   |   |   | - |   |
|      and accrued liabilities                                           |   |   | 19,668 |   |   |   | 2,400 |   |   |   | (5,069 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net cash used in operating activities                                                     |   |   | (687,394 | ) |   |   | (4,890 | ) |   |   | (8,727 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  CASH FLOWS FROM FINANCING ACTIVITIES                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Loan from Stockholders                                                                    |   |   | 301,708 |   |   |   | - |   |   |   |   |   |
|  Proceeds from issuance of capital stock                                                   |   |   | 355,784 |   |   |   | - |   |   |   |   |   |
|  Acquisition of India technology license                                                   |   |   | (600,000 | ) |   |   | - |   |   |   | (600,000 | ) |
|  Loan from Boreas Research Corporation, net                                                |   |   | 540,000 |   |   |   |   |   |   |   | 600,000 |   |
|  Proceeds of sale of non-controlling interest in subsidiary                                |   |   | 100,000 |   |   |   | - |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Net cash provided by financing activities                                                 |   |   | 697,492 |   |   |   | - |   |   |   | - |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  NET INCREASE (DECREASE) IN CASH                                                           |   |   | 10,098 |   |   |   | (4,890 | ) |   |   | (8,727 | ) |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  Cash, beginning of period                                                                 |   |   | - |   |   |   | 14,988 |   |   |   | 36,730 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  CASH, END OF PERIOD                                                                       |   |   | 10,098 |   |   |   | 10,098 |   |   |   | 28,003 |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  INCOME TAXES PAID                                                                         |   |   | - |   |   |   | - |   |   |   | - |   |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |
|  INTEREST PAID                                                                             |   |   | 3,226 |   |   |   | - |   |   |   | - |   |

----

| FIRST NATIONAL ENERGY CORPORATION                                                     |
|---------------------------------------------------------------------------------------|
| (Formerly First National Power Corporation)                                           |
| (A Development Stage Company)                                                         |
| Consolidated Interim Statements of Changes in Stockholders’ Equity (Deficiency) |
| For the period since inception to March 31, 2011                                      |
| (Amounts expressed in US Dollars)                                                     |

|                                    |   | Common stock - dollar amount at par value |   |   | Common stock - number of shares |   |      | Common stock subscribed |   |   |  Additional paid-in capital |   |   |  Deficit accumulated during the development stage |   |   |  Total FNEC stockholders' equity (deficit) |   |    |  Non-controlling interests |   |   |  Total stockholders' equity (deficit) |   |
|-----------------------------------------|--------|-------------------------------------------|--------|--------|---------------------------------|--------|-----------|-------------------------|--------|--------|----------------------------------|--------|--------|--------------------------------------------------------|--------|--------|------------------------------------------------------|--------|---------|---------------------------------|--------|--------|--------------------------------------------|--------|
|                                    |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |
|                                    |   |                                      |   |   | $                               |   |      | $                       |   |   | $                                |   |   | $                                                      |   |   | $                                                    |   |    | $                               |   |   | $                                          |   |
|                                    |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |
|  Balance at November 16, 2000      |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |
|  Issuance of common stock for cash |   |                                      | 100    |   |                            |   | 100,000   |                    |   |   |                             |   |   |                                                   | 900    |   |                                                 |   |    |                            |   |   | 1,000                                      |   |   |   |   |   |   |   | 1,000 |   |
|  Net Loss for the Period           |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   | (968    | )                               |   |   | (968                                       | )      |   |   |   |   |   |   | (968 | ) |
|                                    |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2000   |   |                                      | 100    |   |                            |   | 100,000   |                    |   |   | -                                |   |   |                                                   | 900    |   |                                                 |   | (968    | )                               |   |   | 32                                         |   |   |   | - |   |   |   | 32 |   |
|                                    |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Issuance of stock for cash        |   |                                      | 400    |   |                            |   | 400,000   |                    |   |   |                             |   |   |                                                   | 3,600  |   |                                                 |   |    |                            |   |   | 4,000                                      |   |   |   |   |   |   |   | 4,000 |   |
|  Issuance of stock for cash        |   |                                      | 700    |   |                            |   | 700,000   |                    |   |   |                             |   |   |                                                   | 6,300  |   |                                                 |   |    |                            |   |   | 7,000                                      |   |   |   |   |   |   |   | 7,000 |   |
|  Issuance of stock for cash        |   |                                      | 850    |   |                            |   | 850,000   |                    |   |   |                             |   |   |                                                   | 7,650  |   |                                                 |   |    |                            |   |   | 8,500                                      |   |   |   |   |   |   |   | 8,500 |   |
|  Currency Translation              |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   | 100    |   |                                                 |   |    |                            |   |   | 100                                        |   |   |   |   |   |   |   | 100 |   |
|  Net Loss for the Year             |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   | (23,954 | )                               |   |   | (23,954                                    | )      |   |   |   |   |   |   | (23,954 | ) |
|                                    |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2001   |   |                                      | 2,050  |   |                            |   | 2,050,000 |                    |   |   | -                                |   |   |                                                   | 18,550 |   |                                                 |   | (24,922 | )                               |   |   | (4,322                                     | )      |   |   | - |   |   |   | (4,322 | ) |
|                                    |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Expiration of recission offer for |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|    sale of stock         |   |                                      | 64     |   |                            |   | 63,536    |                    |   |   |                             |   |   |                                                   | 6,290  |   |                                                 |   |    |                            |   |   | 6,354                                      |   |   |   |   |   |   |   | 6,354 |   |
|  Net Loss for the Year             |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   | (26,047 | )                               |   |   | (26,047                                    | )      |   |   |   |   |   |   | (26,047 | ) |
|                                    |   |                                      |   |   |                            |   |      |                    |   |   |                             |   |   |                                                   |   |   |                                                 |   |    |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2002   |   |                                      | 2,114  |   |                            |   | 2,113,536 |                    |   |   | -                                |   |   |                                                   | 24,840 |   |                                                 |   | (50,969 | )                               |   |   | (24,015                                    | )      |   |   | - |   |   |   | (24,015 | ) |

----

| FIRST NATIONAL ENERGY CORPORATION                                                     |
|---------------------------------------------------------------------------------------|
| (Formerly First National Power Corporation)                                           |
| (A Development Stage Company)                                                         |
| Consolidated Interim Statements of Changes in Stockholders’ Equity (Deficiency) |
| For the period since inception to March 31, 2011                                      |
| (Amounts expressed in US Dollars)                                                     |

|                                      |   | Common stock - dollar amount at par value |   |   | Common stock - number of shares |   |       | Common stock subscribed |   |   | Additional paid-in capital |   |   |  Deficit accumulated during the development stage |    |   | Total FNEC stockholders' equity (deficit) |   |     | Non-controlling interests |   |   | Total stockholders' equity (deficit) |   |
|-------------------------------------------|--------|-------------------------------------------|--------|--------|---------------------------------|--------|------------|-------------------------|--------|--------|----------------------------|--------|--------|--------------------------------------------------------|---------|--------|------------------------------------------------|--------|----------|---------------------------|--------|--------|--------------------------------------|--------|
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |
|                                      |   |                                      |   |   | $                               |   |       | $                       |   |   | $                          |   |   | $                                                      |    |   | $                                              |   |     | $                         |   |   | $                                    |   |
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |   |   |   |   |   |   |   |
|  Stock split 5:1                     |   |                                      | 8,454  |   |                            |   | 8,454,144  |                    |   |   |                       |   |   |                                                   | (8,454  | )      |                                           |   |     |                      |   |   | -                                    |   |   |   |   |   |   |   |   |   |
|  Shares issued for services rendered |   |                                      | 200    |   |                            |   | 200,000    |                    |   |   |                       |   |   |                                                   | 79,800  |   |                                           |   |     |                      |   |   | 80,000                               |   |   |   |   |   |   |   | 80,000 |   |
|  Net Loss for the Year               |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   | (107,245 | )                         |   |   | (107,245                             | )      |   |   |   |   |   |   | (107,245 | ) |
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2003     |   |                                      | 10,768 |   |                            |   | 10,767,680 |                    |   |   | -                          |   |   |                                                   | 96,186  |   |                                           |   | (158,214 | )                         |   |   | (51,260                              | )      |   |   | - |   |   |   | (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                               |   |   |   |   |   |   |   | 15,900 |   |
|  Shares subscribed                   |   |                                      |   |   |                            |   |       |                    |   |   | 146                        |   |   |                                                   | 70,371  |   |                                           |   |     |                      |   |   | 70,517                               |   |   |   |   |   |   |   | 70,517 |   |
|  Shares issued for services rendered |   |                                      | 44     |   |                            |   | 43,000     |                    |   |   |                       |   |   |                                                   | 9,956   |   |                                           |   |     |                      |   |   | 10,000                               |   |   |   |   |   |   |   | 10,000 |   |
|  Net Loss for the Year               |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   | (75,414  | )                         |   |   | (75,414                              | )      |   |   |   |   |   |   | (75,414 | ) |
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2004     |   |                                      | 75,448 |   |                            |   | 75,446,760 |                    |   |   | 146                        |   |   |                                                   | 127,777 |   |                                           |   | (233,628 | )                         |   |   | (30,257                              | )      |   |   | - |   |   |   | (30,257 | ) |
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |   |   |   |   |   |   |   |   |
|  Shares issued for services rendered |   |                                      | 830    |   |                            |   | 830,000    |                    |   |   |                       |   |   |                                                   | 193,160 |   |                                           |   |     |                      |   |   | 193,990                              |   |   |   |   |   |   |   | 193,990 |   |
|  Net Loss for the Year               |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   | (208,886 | )                         |   |   | (208,886                             | )      |   |   |   |   |   |   | (208,886 | ) |
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2005     |   |                                      | 76,278 |   |                            |   | 76,276,760 |                    |   |   | 146                        |   |   |                                                   | 320,937 |   |                                           |   | (442,514 | )                         |   |   | (45,153                              | )      |   |   | - |   |   |   | (45,153 | ) |
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |   |   |   |   |   |   |   |   |
|  Net Loss for the Year               |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   | (32,962  | )                         |   |   | (32,962                              | )      |   |   |   |   |   |   | (32,962 | ) |
|                                      |   |                                      |   |   |                            |   |       |                    |   |   |                       |   |   |                                                   |    |   |                                           |   |     |                      |   |   |                                 |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2006     |   |                                      | 76,278 |   |                            |   | 76,276,760 |                    |   |   | 146                        |   |   |                                                   | 320,937 |   |                                           |   | (475,476 | )                         |   |   | (78,115                              | )      |   |   | - |   |   |   | (78,115 | ) |

----

| FIRST NATIONAL ENERGY CORPORATION                                                     |
|---------------------------------------------------------------------------------------|
| (Formerly First National Power Corporation)                                           |
| (A Development Stage Company)                                                         |
| Consolidated Interim Statements of Changes in Stockholders’ Equity (Deficiency) |
| For the period since inception to March 31, 2011                                      |
| (Amounts expressed in US Dollars)                                                     |

|                                             |   | Common stock - dollar amount at par value |    |   | Common stock - number of shares |   |        | Common stock subscribed |   |   |  Additional paid-in capital |   |   | Deficit accumulated during the development stage |    |   |  Total FNEC stockholders' equity (deficit) |   |     |  Non-controlling interests |   |   |  Total stockholders' equity (deficit) |   |
|--------------------------------------------------|--------|-------------------------------------------|---------|--------|---------------------------------|--------|-------------|-------------------------|--------|--------|----------------------------------|--------|--------|--------------------------------------------------|---------|--------|------------------------------------------------------|--------|----------|---------------------------------|--------|--------|--------------------------------------------|--------|
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |
|                                             |   |                                      |    |   | $                               |   |        | $                       |   |   | $                                |   |   | $                                                |    |   | $                                                    |   |     | $                               |   |   | $                                          |   |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |
|  Issue shares bought under subscription     |   |                                      | 146     |   |                            |   | 146,000     |                    |   |   | (146                             | )      |   |                                             |    |   |                                                 |   |     |                            |   |   | -                                          |   |   |   |   |   |   |   | - |   |
|  Net Loss for the Year                      |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   | (30,760  | )                               |   |   | (30,760                                    | )      |   |   |   |   |   |   | (30,760 | ) |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2007            |   |                                      | 76,424  |   |                            |   | 76,422,760  |                    |   |   | -                                |   |   |                                             | 320,937 |   |                                                 |   | (506,236 | )                               |   |   | (108,875                                   | )      |   |   | - |   |   |   | (108,875 | ) |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Shares issued for services rendered        |   |                                      | 100     |   |                            |   | 100,000     |                    |   |   |                             |   |   |                                             | 400     |   |                                                 |   |     |                            |   |   | 500                                        |   |   |   |   |   |   |   | 500 |   |
|  Net Loss for the year                      |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   | (78,645  | )                               |   |   | (78,645                                    | )      |   |   |   |   |   |   | (78,645 | ) |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2008            |   |                                      | 76,524  |   |                            |   | 76,522,760  |                    |   |   | -                                |   |   |                                             | 321,337 |   |                                                 |   | (584,881 | )                               |   |   | (187,020                                   | )      |   |   | - |   |   |   | (187,020 | ) |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Reverse Stock split 1:100                  |   |                                      | (75,759 | )      |                            |   | (75,757,532 | )                       |   |   |                             |   |   |                                             | 75,759  |   |                                                 |   |     |                            |   |   | -                                          |   |   |   |   |   |   |   | - |   |
|  Shares issued for services rendered        |   |                                      | 100     |   |                            |   | 100,000     |                    |   |   |                             |   |   |                                             | 31,900  |   |                                                 |   |     |                            |   |   | 32,000                                     |   |   |   |   |   |   |   | 32,000 |   |
|  Purchase of SWEG license for shares        |   |                                      | 98,800  |   |                            |   | 98,800,000  |                    |   |   |                             |   |   |                                             | (98,700 | )      |                                                 |   |     |                            |   |   | 100                                        |   |   |   |   |   |   |   | 100 |   |
|  Net Loss for the Year                      |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   | (81,131  | )                               |   |   | (81,131                                    | )      |   |   |   |   |   |   | (81,131 | ) |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2009 (restated) |   |                                      | 99,665  |   |                            |   | 99,665,228  |                    |   |   | -                                |   |   |                                             | 330,296 |   |                                                 |   | (666,012 | )                               |   |   | (236,051                                   | )      |   |   | - |   |   |   | (236,051 | ) |
|                                             |   |                                      |    |   |                            |   |        |                    |   |   |                             |   |   |                                             |    |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |

----

| FIRST NATIONAL ENERGY CORPORATION                                                     |
|---------------------------------------------------------------------------------------|
| (Formerly First National Power Corporation)                                           |
| (A Development Stage Company)                                                         |
| Consolidated Interim Statements of Changes in Stockholders’ Equity (Deficiency) |
| For the period since inception to March 31, 2011                                      |
| (Amounts expressed in US Dollars)                                                     |

|                                                 |   |  Common stock - dollar amount at par value |   |   | Common stock - number of shares |   |       | Common stock subscribed |   |   |  Additional paid-in capital |   |   |  Deficit accumulated during the development stage |     |   |  Total FNEC stockholders' equity (deficit) |   |     |  Non-controlling interests |   |   |  Total stockholders' equity (deficit) |   |
|------------------------------------------------------|--------|-------------------------------------------------|--------|--------|---------------------------------|--------|------------|-------------------------|--------|--------|----------------------------------|--------|--------|--------------------------------------------------------|----------|--------|------------------------------------------------------|--------|----------|---------------------------------|--------|--------|--------------------------------------------|--------|
|                                                 |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   |     |   |                                                 |   |     |                            |   |   |                                       |   |
|                                                 |   |                                            |   |   | $                               |   |       | $                       |   |   | $                                |   |   | $                                                      |     |   | $                                                    |   |     | $                               |   |   | $                                          |   |
|                                                 |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   |     |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |
|  Shares issued in exchange for debt forgiveness |   |                                            | 100    |   |                            |   | 100,000    |                    |   |   |                             |   |   |                                                   | 258,213  |   |                                                 |   |     |                            |   |   | 258,313                                    |   |   |   |   |   |   |   | 258,313 |   |
|  Return of shares for cancellation              |   |                                            | (296   | )      |                            |   | (296,400   | )                       |   |   |                             |   |   |                                                   | 296      |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   | - |   |
|  Shares issued for services rendered            |   |                                            | 296    |   |                            |   | 296,400    |                    |   |   |                             |   |   |                                                   | 14,524   |   |                                                 |   |     |                            |   |   | 14,820                                     |   |   |   |   |   |   |   | 14,820 |   |
|  Sale of non-controlling interest in subsidiary |   |                                            |   |   |                            |   | 100,000    |                    |   |   |                             |   |   |                                                   | 99,900   |   |                                                 |   |     |                            |   |   | 99,900                                     |   |   |   | 100 |   |   |   | 100,000 |   |
|  Purchase of SWEG technology license            |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   | (599,900 | )      |                                                 |   |     |                            |   |   | (599,900                                   | )      |   |   |   |   |   |   | (599,900 | ) |
|  Net Loss for the Year                          |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   |     |   |                                                 |   | (75,237  | )                               |   |   | (75,237                                    | )      |   |   | (26 | ) |   |   | (75,263 | ) |
|                                                 |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   |     |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2010                |   |                                            | 99,765 |   |                            |   | 99,865,228 |                    |   |   | -                                |   |   |                                                   | 103,329  |   |                                                 |   | (741,249 | )                               |   |   | (538,155                                   | )      |   |   | 74 |   |   |   | (538,081 | ) |
|                                                 |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   |     |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Net Loss for the Period                        |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   |     |   |                                                 |   | (7,290   | )                               |   |   | (7,290                                     | )      |   |   | 0 |   |   |   | (7,290 | ) |
|                                                 |   |                                            |   |   |                            |   |       |                    |   |   |                             |   |   |                                                   |     |   |                                                 |   |     |                            |   |   |                                       |   |   |   |   |   |   |   |   |   |
|  Balance as of March 31, 2011                   |   |                                            | 99,765 |   |                            |   | 99,865,228 |                    |   |   | -                                |   |   |                                                   | 103,329  |   |                                                 |   | (748,539 | )                               |   |   | (545,445                                   | )      |   |   | 74 |   |   |   | (545,371 | ) |

----

----

| a)  | Description of the Business |
|----------|-----------------------------|

| b) | Purchase of Technology License |
|----|--------------------------------|

----

----

| c) | Further Purchase of Technology License |
|----|----------------------------------------|

----

----

| a)  | Basis of Consolidation |
|----------|------------------------|

| b)  | Use of Estimates |
|----------|------------------|

| c)  | Project Development Costs |
|----------|---------------------------|

----

----

| d)  | Financial Instruments |
|----------|-----------------------|

| e)  | Income Taxes |
|----------|--------------|

| f)  | Earnings or Loss Per Share |
|----------|----------------------------|

| g)  | Comprehensive Income (Loss) |
|----------|-----------------------------|

| h)  | Intangible Assets |
|----------|-------------------|

----

----

| i)  | Impairment of Long Lived Assets |
|----------|---------------------------------|

| j)  | Development Stage Company |
|----------|---------------------------|

|                              |   | 2010   |   |   | 2009                     |   |
|-----------------------------------|--------|--------|--------|--------|--------------------------|--------|
|                              |   | Cost   |   |   | Accumulated Amortization |   |   | Net Book Value |   |   | Net Book Value |   |
|                              |   |   |   |   |                     |   |   |   |   |   |   |   |
| North American Technology License |   | $      | 100    |   |                     | $      | - |   |   | $ | 100 |   |   | $ | 100 |   |
| Indian Technology License         |   |   | 100    |   |                     |   | - |   |   |   | 100 |   |   |   | 100 |   |
|                              |   | $      | 200    |   |                     | $      | - |   |   | $ | 200 |   |   | $ | 200 |   |

|                      |   | 2011 |   |   | 2010   |   |
|---------------------------|--------|------|--------|--------|--------|--------|
| Accrued Professional Fees |   | $    | 15,669 |   |   | $      | 13,269 |   |
| Accrued Professional Fees |   | $    | 15,669 |   |   | $      | 13,269 |   |

----

----

| a)  | Authorized |
|----------|------------|

| b)  | Issued |
|----------|--------|

| b)  | Changes in Issued Share Capital |
|----------|---------------------------------|

----

----

----

----

----

----

----

----

----

| Exhibit No. |   | Document                                                                                                                                                                       |
|-------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |   |                                                                                                                                                                           |
| 31.1*       |   | Sect. 302 Certification Statement of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                     |
|        |   |                                                                                                                                                                           |
| 31.2*       |   | Sect. 302 Certification Statement of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                     |
|        |   |                                                                                                                                                                           |
| 32.1*       |   | Sect. 906 Certification Statement of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002  |
|        |   |                                                                                                                                                                           |
| 32.1*       |   | Sect. 906 Certification Statement of the Principal Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002 |

----

|                                 | FIRST NATIONAL ENERGY CORPORATION |                                     |
|--------------------------------------|-----------------------------------|------------------------------------------|
|                                 |                              |                                     |   |
| Dated: June  9, 2011  | By:                               | /s/ Gregory Sheller                 |   |
|                                 |                              | Gregory Sheller, Chief Executive Officer |   |
|                                 |                              |                                     |   |
|                                 |                              |                                     |   |