----

----

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

----

----

----

| Consolidated Interim Balance Sheets as at June 30, 2010 (unaudited) and December 31, 2009 (audited)                                                                                         |   |   | 1           |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|--------|
|                                                                                                                                                                                        |   |   |        |   |
| Consolidated  Interim Statements of Operations for the 6 month periods ended  June 30, 2010 and June 30, 2009 for the cumulative period since inception (unaudited)     |   |   | 2           |   |
|                                                                                                                                                                                        |   |   |        |   |
| Consolidated  Interim Statements of Operations for the 3 month periods ended  June 30, 2010 and June 30, (unaudited)                                                    |   |   | 3           |   |
|                                                                                                                                                                                        |   |   |        |   |
| Consolidated  Interim Statements of Cash Flows for the 6 month periods ended  June 30, 2010 and June 30, 2009 and for the cumulative period since inception (unaudited) |   |   | 4           |   |
|                                                                                                                                                                                        |   |   |        |   |
| Consolidated Interim Statements of Changes in Stockholders’ Equity from inception to June 30, 2010 (unaudited)                                                                        |   |   | 5 - 7  |   |
|                                                                                                                                                                                        |   |   |        |   |
| Condensed Notes to Consolidated Interim Financial Statements (unaudited)                                                                                                                    |   |   | 8 - 11 |   |

----

----

----

----

| FIRST NATIONAL ENERGY CORPORATION           |   |
|---------------------------------------------|--------|
| (Formerly First National Power Corporation) |   |
| (A Development Stage Company)               |   |
| Consolidated Interim Balance Sheets         |   |
| As of June 30, 2010 and December 31, 2009   |   |
| (Amounts expressed in US Dollars)           |   |

|                             |                                                                     |
|----------------------------------|--------------------------------------------------------------------------|
|                             |                                                                     |   | June 30 |   |   | December 31 |   |
|                             |                                                                     |   | 2010 |   |   | 2009 |   |
| ASSETS                           |                                                                     | $ |   |   |   | $ |   |   |
|                             |  CURRENT ASSETS                                                     |   |   |   |   |   |   |   |   |
|                             |  Cash                                                               |   |   | 113,401 |   |   |   | 36,730 |   |
|                             |                                                                     |   |   | 113,401 |   |   |   | 36,730 |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|                             |  License for SWEG technology, net of amortization                   |   |   | 2,218,187 |   |   |   | 1,725,967 |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|                             |                                                                     |   |   | 2,331,588 |   |   |   | 1,762,697 |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|  LIABILITIES                |                                                                     |   |   |   |   |   |   |   |
|                             |  CURRENT LIABILITIES                                                |   |   |   |   |   |   |   |   |
|                             |  Accounts payable and accrued liabilities                           |   |   | 7,500 |   |   |   | 14,568 |   |
|                             |  Payable to Boreas Research for SWEG license                        |   |   | 600,000 |   |   |   |   |   |
|                             |  Loans from shareholders                                            |   |   | 258,313 |   |   |   | 258,313 |   |
|                             |                                                                     |   |   | 865,813 |   |   |   | 272,881 |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|  Going Concern (Note 2)     |                                                                     |   |   |   |   |   |   |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|  STOCKHOLDERS’ EQUITY |                                                                     |   |   |   |   |   |   |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|                             |  Capital Stock                                                      |   |   | 99,665 |   |   |   | 99,665 |   |
|                             |  Additional paid-in Capital                                         |   |   | 2,285,701 |   |   |   | 2,185,801 |   |
|                             |   Deficit, accumulated during the development stage                 |   |   | (919,676 | ) |   |   | (795,650 | ) |
|                             |  Total First National Energy Corporation Shareholders’ Equity |   |   | 1,465,690 |   |   |   | 1,489,816 |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|                             | Non-controlling interest                                                 |   |   | 85 |   |   |   |   |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|                             | Total Equity                                                             |   |   | 1,465,775 |   |   |   | 1,489,816 |   |
|                             |                                                                     |   |   |   |   |   |   |   |   |
|                             |                                                                     |   |   | 2,331,587 |   |   |   | 1,762,697 |   |

----

| FIRST NATIONAL ENERGY CORPORATION                                                                       |   |
|---------------------------------------------------------------------------------------------------------|--------|
| (Formerly First National Power Corporation)                                                             |   |
| (A Development Stage Company)                                                                           |   |
| Consolidated Interim Statements of Operations and Comprehensive Loss                                    |   |
| For the 6 Month periods ended June 30, 2010 and June 30, 2009 and the cumulative period since Inception |   |
| (Amounts expressed in US Dollars)                                                                       |   |
|                                                                 |   |       |     |   | 6 Months |   |       | 6 Months |   |
|----------------------------------------------------------------------|--------|------------|----------|--------|----------|--------|------------|----------|--------|
|                                                                 |   | Cumulative |     |   | ended    |   |       | ended    |   |
|                                                                 |   | Since      |     |   | June 30  |   |       | June 30  |   |
|                                                                 |   | Inception  |     |   | 2010     |   |       | 2009     |   |
|                                                                 |   | $          |     |   |     | $      |       |     |   | $ |   |   |
| OPERATING EXPENSES                                                   |   |       |     |   |     |   |       |     |   |   |   |   |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Interest Income                                                      |   |       | (6,921   | )      |     |   | (17        | )        |   |   | (65 | ) |
| Forgiveness of accounts payable and loans                            |   |       | (47,394  | )      |     |   |       |     |   |   |   |   |
| General and administrative expenses                                  |   |       | 459,925  |   |     |   | 16,278     |     |   |   | 63,162 |   |
| Loss on Foreign Exchange                                             |   |       | 580      |   |     |   |       |     |   |   |   |   |
| Amortization                                                         |   |       | 237,418  |   |     |   | 107,780    |     |   |   | 30,927 |   |
| Project development costs                                            |   |       | 272,857  |   |     |   |       |     |   |   |   |   |
| Interest Expense                                                     |   |       | 3,226    |   |     |   | -          |     |   |   |   |   |
|                                                                 |   |       | 919,691  |   |     |   | 124,041    |     |   |   | 94,024 |   |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| NET LOSS                                                             |   |       | (919,691 | )      |     |   | (124,041   | )        |   |   | (94,024 | ) |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Net loss attributable to non-controlling interest                    |   |       | (15      | )      |     |   | (15        | )        |   |   | - |   |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Net loss attributable to First National Energy Corporation           |   |       | (919,676 | )      |     |   | (124,026   | )        |   |   | (94,024 | ) |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Net loss per share, basic and diluted                                |   |       |     |   |     | $      | (0.00      | )        |   | $ | (0.00 | ) |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Weighted average common shares outstanding                           |   |       |     |   |     |   | 99,665,228 |     |   |   | 20,978,488 |   |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| COMPREHENSIVE LOSS                                                   |   |       |     |   |     |   |       |     |   |   |   |   |
| Net loss                                                             |   |       | (919,691 | )      |     |   | (124,041   | )        |   |   | (94,024 | ) |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Other Comprehensive loss                                             |   |       | -        |   |     |   | -          |     |   |   | - |   |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Comprehensive loss                                                   |   |       | (919,691 | )      |     |   | (124,041   | )        |   |   | (94,024 | ) |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Comprehensive loss attributable to non-controlling interest          |   |       | (15      | )      |     |   | (15        | )        |   |   | - |   |
|                                                                 |   |       |     |   |     |   |       |     |   |   |   |   |
| Comprehensive loss attributable to First National Energy Corporation |   |       | 919,676  |   |     |   | (124,056   | )        |   |   | (94,024 | ) |

----

| Consolidated Interim Statements of Operations and Comprehensive Loss |   |
|----------------------------------------------------------------------|--------|
| For the 3 Month periods ended June 30, 2010 and June 30, 2009        |   |
| (Amounts expressed in US Dollars)                                    |   |

|                                                                 |   |     |       |   |     |   |
|----------------------------------------------------------------------|--------|----------|------------|--------|----------|--------|
|                                                                 |   | 3 Months |       |   | 3 Months |   |
|                                                                 |   | ended    |       |   | ended    |   |
|                                                                 |   | June 30  |       |   | June 30  |   |
|                                                                 |   | 2010     |       |   | 2009     |   |
| OPERATING EXPENSES                                                   |   |     |       |   |     |   |   |   |
|                                                                 |   |     |       |   |     |   |   |   |
|  Interest Income                                                |   |     | (5         | )      |     |   | (30 | ) |
|  Forgiveness of accounts payable and loans                      |   |     |       |   |     |   |   |   |
|  General and administrative expenses                            |   |     | 12,608     |   |     |   | 52,925 |   |
|  Loss on Foreign Exchange                                       |   |     |       |   |     |   |   |   |
|  Amortization                                                   |   |     | 61,390     |   |     |   | 30,927 |   |
|  Project development costs                                      |   |     |       |   |     |   |   |   |
|  Interest Expense                                               |   |     | -          |   |     |   |   |   |
|                                                                 |   |     | 73,993     |   |     |   | 83,822 |   |
|                                                                 |   |     |       |   |     |   |   |   |
| NET LOSS                                                             |   |     | (73,993    | )      |     |   | (83,822 | ) |
|                                                                 |   |     |       |   |     |   |   |   |
| Net loss attributable to non-controlling interest                    |   |     | (15        | )      |     |   | - |   |
|                                                                 |   |     |       |   |     |   |   |   |
| Net loss attributable to First National Energy Corporation           |   |     | 73,978     |   |     |   | (83,822 | ) |
|                                                                 |   |     |       |   |     |   |   |   |
| Net loss per share, basic and diluted                                |   | $        | 0.00       |   |     | $      | (0.00 | ) |
|                                                                 |   |     |       |   |     |   |   |   |
| Weighted average common shares outstanding                           |   |     | 99,665,228 |   |     |   | 40,969,624 |   |
|                                                                 |   |     |       |   |     |   |   |   |
|                                                                 |   |     |       |   |     |   |   |   |
| COMPREHENSIVE LOSS                                                   |   |     |       |   |     |   |   |   |
| Net loss                                                             |   |     | (73,993    | )      |     |   | (83,822 | ) |
|                                                                 |   |     |       |   |     |   |   |   |
| Other Comprehensive loss                                             |   |     | -          |   |     |   | - |   |
|                                                                 |   |     |       |   |     |   |   |   |
| Comprehensive loss                                                   |   |     | (73,993    | )      |     |   | (83,822 | ) |
|                                                                 |   |     |       |   |     |   |   |   |
| Comprehensive loss attributable to non-controlling interest          |   |     | (15        | )      |     |   | - |   |
|                                                                 |   |     |       |   |     |   |   |   |
| Comprehensive loss attributable to First National Energy Corporation |   |     | (73,978    | )      |     |   | (83,822 | ) |

----

| FIRST NATIONAL ENERGY CORPORATION                                                                       |   |
|---------------------------------------------------------------------------------------------------------|--------|
| (Formerly First National Power Corporation)                                                             |   |
| (A Development Stage Company)                                                                           |   |
| Consolidated Interim Statements of Cash Flows                                                           |   |
| For the 6 Month Periods ended June 30, 2010 and June 30, 2009 and the cumulative period since inception |   |
| (Amounts expressed in US Dollars)                                                                       |   |

|                                                                 |   |       |      |   | 6 Months |   |     | 6 Months |   |
|----------------------------------------------------------------------|--------|------------|-----------|--------|----------|--------|----------|----------|--------|
|                                                                 |   | Cumulative |      |   | ended    |   |     | ended    |   |
|                                                                 |   | Since      |      |   | June 30  |   |     | June 30  |   |
|                                                                 |   | Inception  |      |   | 2010     |   |     | 2009     |   |
|                                                                 |   | $          |      |   |     | $      |     |     |   | $ |   |   |
| CASH FLOWS FROM OPERATING ACTIVITIES                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  Net loss                                                       |   |       | (919,691  | )      |     |   | (124,041 | )        |   |   | (94,024 | ) |
|  Adjustments for items not affecting cash                       |   |       |      |   |     |   |     |     |   |   |   |   |
|  Amortization                                                   |   |       | 237,418   |   |     |   | 107,780  |     |   |   | 30,927 |   |
|  Shares issued for services rendered                            |   |       | 332,390   |   |     |   | -        |     |   |   | 32,000 |   |
|  Forgiveness of accounts payable and loans                      |   |       | (47,394   | )      |     |   |     |     |   |   |   |   |
|  Increase (decrease) in accounts payable                        |   |       |      |   |     |   |     |     |   |   |   |   |
|      and accrued liabilities                |   |       | 11,499    |   |     |   | (7,068   | )        |   |   | (4,629 | ) |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  Net cash used in operating activities                          |   |       | (385,778  | )      |     |   | (23,329  | )        |   |   | (35,726 | ) |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
| CASH FLOWS FROM FINANCING ACTIVITIES                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  Loans from Shareholders                                        |   |       | 301,708   |   |     |   | -        |     |   |   |   |   |
|  Proceeds from sale of capital stock                            |   |       | 97,471    |   |     |   |     |     |   |   |   |   |
|  Proceeds of sale of minority interest in subsidiary            |   |       | 100,000   |   |     |   | 100,000  |     |   |   |   |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  Net cash provided by financing activities                      |   |       | 499,179   |   |     |   | 100,000  |     |   |   | - |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
| NET INCREASE (DECREASE) IN CASH                                      |   |       | 113,401   |   |     |   | 76,671   |     |   |   | (35,726 | ) |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  Cash, beginning of period                                      |   |       | -         |   |     |   | 36,730   |     |   |   | 85,122 |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  CASH, END OF PERIOD                                            |   |       | 113,401   |   |     |   | 113,401  |     |   |   | 49,396 |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  INCOME TAXES PAID                                              |   |       | -         |   |     |   | -        |     |   |   | - |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  INTEREST PAID                                                  |   |       | 3,226     |   |     |   | -        |     |   |   | - |   |
|                                                                 |   |       |      |   |     |   |     |     |   |   |   |   |
|  NON-CASH TRANSACTIONS - PURCHASE OF SWEG TECHNOLOGY FOR SHARES |   |       | 1,855,605 |   |     |   | -        |     |   |   | - |   |
|  PURCHASE OF SWEG TECHNOLOGY BY SUBSIDIARY FOR NOTE PAYABLE     |   |       | 600,000   |   |     |   | 600,000  |     |   |   | - |   |

----

| FIRST NATIONAL ENERGY CORPORATION                                                     |
|---------------------------------------------------------------------------------------|
| (Formerly First National Power Corporation)                                           |
| (A Development Stage Company)                                                         |
| Consolidated Interim Statements of Changes in Stockholders’ Equity (Deficiency) |
| From Inception until June 30, 2010                                                    |
| (Amounts expressed in US Dollars)                                                     |

|                                    |   | Common stock - dollar amountat par value |   |   | Common stock - number ofshares |   |      | Common stock subscribed |   |   | Additionalpaid-in capital(discount) |   |   | Deficitaccumulatedduring the developmenstage |   |   | Total Parent Company shareholders'equity |   |    | Non-controlling interests |   |   | Total shareholders' equity |   |
|-----------------------------------------|--------|------------------------------------------|--------|--------|--------------------------------|--------|-----------|-------------------------|--------|--------|-------------------------------------|--------|--------|----------------------------------------------|--------|--------|------------------------------------------|--------|---------|---------------------------|--------|--------|----------------------------|--------|
|                                    |   |                                     |   |   |
|                                    |
|                                    |
|                                    |
|                                    |   | $                                        |   |   |                           |   |      |                    |   | $      |                                |   |   | $                                            |   |   |                                     | $      |    |                      |   | $      |                       |   |   | $ |   |   |   | $ |   |   |
|  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) |
| From Inception until June 30, 2010                                                    |
| (Amounts expressed in US Dollars)                                                     |

|                                      |   | Common stock - dollar amountat par value |   |   | Common stock - number ofshares |   |       | Common stock subscribed |   |   | Additionalpaid-in capital (discount) |   |   | Deficitaccumulatedduring the developmentstage |    |   | Total Parent Company shareholders'equity |   |     | Non-controlling interests |   |   | Total shareholders' equity |   |
|-------------------------------------------|--------|------------------------------------------|--------|--------|--------------------------------|--------|------------|-------------------------|--------|--------|--------------------------------------|--------|--------|-----------------------------------------------|---------|--------|------------------------------------------|--------|----------|---------------------------|--------|--------|----------------------------|--------|
|                                      |   |                                     |   |   |
|                                      |
|                                      |
|                                      |
|                                      |   | $                                        |   |   |                           |   |       |                    |   | $      |                                 |   |   | $                                             |    |   |                                     | $      |     |                      |   | $      |                       |   |   | $ |   |   |   | $ |   |   |
|  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) |
| From Inception until June 30, 2010                                                    |
| (Amounts expressed in US Dollars)                                                     |

|                                         |   | Common stock - dollar amountat par value |    |   | Common stock - number ofshares |   |        | Common stock subscribed |   |   | Additionalpaid-in capital (discount) |   |   | Deficitaccumulatedduring the development stage |      |   | Total Parent Company shareholders'equity |    |     | Non-controlling interests |   |    | Total shareholders' equity |   |
|----------------------------------------------|--------|------------------------------------------|---------|--------|--------------------------------|--------|-------------|-------------------------|--------|--------|--------------------------------------|--------|--------|------------------------------------------------|-----------|--------|------------------------------------------|---------|----------|---------------------------|--------|---------|----------------------------|--------|
|                                         |   |                                     |    |   |
|                                         |
|                                         |
|                                         |
|                                         |   | $                                        |    |   |                           |   |        |                    |   | $      |                                 |   |   | $                                              |      |   |                                     | $       |     |                      |   | $       |                       |   |   | $ |   |   |   | $ |   |   |
|  Net Loss for the Year                  |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     | (30,760 | )        |                      |   | (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                   | )      |   |   | - |   |   |   | (108,875 | ) |
|                                         |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     |    |     |                      |   |    |                       |   |   |   |   |   |   |   |   |   |
|  Shares issued for services rendered    |   |                                     | 100     |   |                           |   | 100,000     |                    |   |   |                                 |   |   |                                           | 400       |   |                                     |    |     |                      |   |    | 500                        |   |   |   |   |   |   |   | 500 |   |
|  Net Loss for the period                |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     |    | (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  |                    |   |   |                                 |   |   |                                           | 1,756,805 |   |                                     |    |     |                      |   |    | 1,855,605                  |   |   |   |   |   |   |   | 1,855,605 |   |
|  Net Loss for the Year                  |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     |    | (210,769 | )                         |   |    | (210,769                   | )      |   |   |   |   |   |   | (210,769 | ) |
|                                         |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     |    |     |                      |   |    |                       |   |   |   |   |   |   |   |   |   |
|  Balance as of December 31, 2009        |   |                                     | 99,665  |   |                           |   | 99,665,228  |                    |   |   | -                                    |   |   |                                           | 2,185,801 |   |                                     |    | (795,650 | )                         |   |    | 1,489,816                  |   |   |   | - |   |   |   | 1,489,816 |   |
|                                         |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     |    |     |                      |   |    |                       |   |   |   |   |   |   |   |   |   |
|  Net Loss for the Year                  |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     |    | (124,026 | )                         |   |    | (124,026                   | )      |   |   | (15 | ) |   |   | (124,041 | ) |
|   Change in non-controlling interest    |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           | 99,900    |   |                                     |    |     |                      |   |    | 99,900                     |   |   |   | 100 |   |   |   | 100,000 |   |
|                                         |   |                                     |    |   |                           |   |        |                    |   |   |                                 |   |   |                                           |      |   |                                     |    |     |                      |   |    |                       |   |   |   |   |   |   |   |   |   |
|  Balance as of June 30, 2010            |   |                                     | 99,665  |   |                           |   | 99,665,228  |                    |   |   | -                                    |   |   |                                           | 2,285,701 |   |                                     |    | (919,676 | )                         |   |    | 1,465,690                  |   |   |   | 85 |   |   |   | 1,465,775 |   |

----

----

----

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|                              |   | Cost |      |   | Accumulated Amortization |   |    | Net Book Value |   |   | Net Book Value |   |
|-----------------------------------|--------|------|-----------|--------|--------------------------|--------|---------|----------------|--------|--------|----------------|--------|
| North American Technology License |   | $    | 1,855,605 |   |                     | $      | 222,418 |           |   | $      | 1,633,187      |   |   | $ | 1,725,967 |   |
| India Technology License          |   | $    | 600,000   |   |                     | $      | 15,000  |           |   | $      | 585,000        |   |   | $ | - |   |
|                              |   | $    | 2,455,605 |   |                     | $      | 237,418 |           |   | $      | 2,218,187      |   |   | $ | 1,725,967 |   |

|   | 2010   | *      |   | $      | 122,780   |   |  * For the second half of 2010 |
|--------|--------|--------|--------|--------|-----------|--------|-------------------------------------|
|   | 2011   |   |   |   | 245,561   |   |                                |
|   | 2012   |   |   |   | 245,561   |   |                                |
|   | 2013   |   |   |   | 245,561   |   |                                |
|   | 2014   |   |   |   | 245,561   |   |                                |
|   |   |   |   | $      | 1,105,024 |   |                                |

----

----

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|   | 2010   | *      |   | $      | 122,780   |   |  * For the second half of 2010 |
|--------|--------|--------|--------|--------|-----------|--------|-------------------------------------|
|   | 2011   |   |   |   | 245,561   |   |                                |
|   | 2012   |   |   |   | 245,561   |   |                                |
|   | 2013   |   |   |   | 245,561   |   |                                |
|   | 2014   |   |   |   | 245,561   |   |                                |
|   |   |   |   | $      | 1,105,024 |   |                                |

----

----

| 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 |

----

|                                        | FIRST NATIONAL ENERGY CORPORATION |                                    |
|---------------------------------------------|-----------------------------------|-----------------------------------------|
|                                        |                              |                                    |   |
| Dated: Aug __, 2010     | By:                               | /s/ Doug Lindeblom                 |   |
|                                        |                              | Doug Lindeblom, Chief Executive Officer |   |