U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM 10-Q


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

                       For the quarter ended May 31, 2009

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


        For the transition period from ______ to _______


                          COMMISSION FILE NO. 000-52782


                            MAINLAND RESOURCES, INC.
                 ______________________________________________
                 (Name of small business issuer in its charter)


            NEVADA                                               90-0335743
_______________________________                              ___________________
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)


                       20333 STATE HIGHWAY 249, SUITE 200
                              HOUSTON, TEXAS 77070
                    ________________________________________
                    (Address of principal executive offices)


                                 (281) 469-5990
                          ___________________________
                          (Issuer's telephone number)


Securities registered pursuant to Section         Name of each exchange on which
            12(b) of the Act:                              registered:
                  NONE


          Securities registered pursuant to Section 12(g) of the Act:

                              COMMON STOCK, $0.001
                              ____________________
                                (Title of Class)


Indicate by checkmark whether the issuer:  (1) has filed all reports required to
be filed by  Section 13 or 15(d) of the  Exchange  Act during the past 12 months
(or for such  shorter  period  that the  registrant  was  required  to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days.
                                 Yes [X ] No[ ]


<PAGE>

Indicate by check mark whether the registrant has submitted  electronically  and
posted on its corporate Web site, if any, every  Interactive  Data File required
to be  submitted  and posted  pursuant to Rule 405 of  Regulation  S-T  (Section
229.405 of this  chapter)  during the  preceding  12 months (or for such shorter
period that the registrant was required to submit and post such files.

Indicate by check mark whether the registrant is a large  accelerated  filed, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer [ ]                                Accelerated filer [X]

Non-accelerated filer   [ ]                        Smaller reporting company [ ]

Indicate by checkmark  whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

Applicable  Only  to  Issuer  Involved  in  Bankruptcy  Proceedings  During  the
Preceding Five Years.

                                       N/A

Indicate by  checkmark  whether the issuer has filed all  documents  and reports
required to be filed by Section 12, 13 and 15(d) of the Securities  Exchange Act
of 1934 after the  distribution of securities under a plan confirmed by a court.
Yes[ ] No[ ]

                    Applicable Only to Corporate Registrants

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the most practicable date:

Class                                            Outstanding as of  July 7, 2009
Common Stock, $0.0001                            40,484,750


                                       2


<PAGE>


                            MAINLAND RESOURCES, INC.

                                    Form 10-Q


Part 1.   FINANCIAL INFORMATION                                                4

Item 1.   FINANCIAL STATEMENTS
             Balance Sheets                                                    5
             Statements of Operations                                          6
             Statements of Cash Flows                                          7
             Notes to Financial Statements                                     8

Item 2.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations                                           17

Item 3.   Quantitative and Qualitative Disclosures About Market Risk          26

Item 4.   Controls and Procedures                                             27

Part II.  OTHER INFORMATION                                                   28

Item 1.   Legal Proceedings                                                   28

Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds         28

Item 3.   Defaults Upon Senior Securities                                     29

Item 4.   Submission of Matters to a Vote of Security Holders                 29

Item 5.   Other Information                                                   29

Item 6.   Exhibits                                                            30


                                       3


<PAGE>


PART I

ITEM 1. FINANCIAL STATEMENTS




                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                              FINANCIAL STATEMENTS

                                  MAY 31, 2009
                                   (UNAUDITED)

























                                       4



<PAGE>

<TABLE>
<CAPTION>

                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                                 BALANCE SHEETS
                                 (U.S. Dollars)

                                                                           May 31,         February 28,
                                                                            2009               2009
                                                                         (unaudited)         (audited)
_______________________________________________________________________________________________________
<S>                                                                     <C>                <C>
                                     ASSETS

CURRENT ASSETS
   Cash                                                                 $    715,628       $    150,276
   Accounts receivable                                                       403,620            373,045
   Deposit on properties (Note 4)                                          1,300,000          1,100,000
_______________________________________________________________________________________________________

  Total current assets                                                     2,419,248          1,623,321
_______________________________________________________________________________________________________

OIL AND GAS PROPERTIES, (Note 4)
   Proved, net of accumulated depletion $36,918 (2009 -12,000)               750,093            775,011
   Unproved                                                                1,404,879                  -
_______________________________________________________________________________________________________

Total Oil and Gas Properties                                               2,154,972            775,011
_______________________________________________________________________________________________________

TOTAL ASSETS                                                            $  4,574,220       $  2,398,332
=======================================================================================================

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
   Accounts payable and accrued liabilities                             $  1,361,678       $     70,230
_______________________________________________________________________________________________________

TOTAL CURRENT LIABILITIES                                                  1,361,678             70,230
_______________________________________________________________________________________________________

STOCKHOLDERS' EQUITY (Note 5)
Common stock, 200,000,000 shares authorized with $0.0001 par value
Issued and outstanding - 39,992,500 common shares                              3,999              3,962
   (February 28, 2009 - 39,615,000)
Additional paid-in-capital                                                16,564,937         16,056,099
Deficit accumulated during exploration stage                             (13,356,394)       (13,731,959)
_______________________________________________________________________________________________________

TOTAL STOCKHOLDERS' EQUITY                                                 3,212,542          2,328,102
_______________________________________________________________________________________________________

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY                                $  4,574,220       $  2,398,332
=======================================================================================================


   The accompanying notes are an integral part of these financial statements.

</TABLE>

                                       5


<PAGE>

<TABLE>
<CAPTION>

                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

                                                                                                May 12, 2006
                                                            Three months      Three months     (inception) to
                                                           ended May 31,     ended May 31,         May 31,
                                                               2009              2008               2009
_____________________________________________________________________________________________________________
<S>                                                         <C>               <C>               <C>

REVENUES
   Oil and gas revenue                                      $   909,121       $         -       $  1,425,700
_____________________________________________________________________________________________________________

GENERAL AND ADMINISTRATIVE EXPENSES
   Operating costs and taxes                                    215,123                 -            364,446
   Depletion allowance                                           24,918                 -             36,918
   Consulting fees (Note 6)                                     151,134           317,780            746,508
   Management and rent fees - related party (Note 7)             35,372            15,500            176,192
   Marketing expenses                                            17,495                 -            938,602
   Mineral property costs                                             -                 -             14,510
   Office and general                                            43,379           170,744            185,426
   Professional fees                                             46,405            31,567            357,715
   Salary expense (Note 6)                                            -         2,457,000         12,002,685
_____________________________________________________________________________________________________________

                                                                533,826         2,992,591         14,823,002
_____________________________________________________________________________________________________________

NET OPERATING INCOME (LOSS)                                     375,295        (2,992,591)       (13,397,302)

OTHER INCOME
   Gain on settlement of debt                                         -            33,239             33,239
   Interest income                                                  270                 -              7,669
_____________________________________________________________________________________________________________

NET INCOME (LOSS)                                               375,565        (2,959,352)       (13,356,394)
_____________________________________________________________________________________________________________

Comprehensive income:
Foreign currency translation adjustment                               -               422                  -
_____________________________________________________________________________________________________________

COMPREHENSIVE INCOME (LOSS)                                 $   375,565       $(2,958,930)      $(13,356,394)
=============================================================================================================



BASIC INCOME (LOSS) PER COMMON SHARE                        $      0.01       $     (0.08)
=========================================================================================

DILUTED INCOME (LOSS) PER COMMON SHARE                      $      0.01       $     (0.00)
=========================================================================================

WEIGHTED AVERAGE NUMBER OF
   COMMON SHARES OUTSTANDING - BASIC                         39,690,409        35,518,434
=========================================================================================

WEIGHTED AVERAGE NUMBER OF
   COMMON SHARES OUTSTANDING - DILUTED                       42,321,203                 -
=========================================================================================



The accompanying notes are an integral part of these financial statements.

</TABLE>

                                       6


<PAGE>

<TABLE>
<CAPTION>

                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                            STATEMENTS OF CASH FLOWS
                                   (unaudited)

                                                                                                         May 12, 2006
                                                                      Three months ended May 31,          (inception)
                                                                     _____________________________         to May 31,
                                                                        2009              2008               2009
_____________________________________________________________________________________________________________________
<S>                                                                  <C>              <C>                <C>

CASH FLOWS FROM OPERATING ACTIVITIES
   Net income loss                                                   $  375,565       $ (2,959,352)      $(13,356,394)
   Adjustments to reconcile net loss to net cash used in
     operating activities:
     - Non-cash mineral property expenditures (recoveries)                    -            (33,239)           (28,799)
     - Depletion                                                         24,918                  -             36,918
     - Stock-based compensation (Note 6)                                      -          2,457,000         12,002,685
     - Non-cash consulting fees (Note 6)                                  8,875                  -              8,875
     - Donated services and expenses                                          -                  -             14,420
CHANGES IN OPERATING ASSETS AND LIABILITIES
     - Accounts receivable                                              (30,575)                 -           (403,620)
     - Accounts payable - related parties                                     -             (6,138)                 -
     - Accounts payable and accrued liabilities                           1,308            159,568             71,538
_____________________________________________________________________________________________________________________

NET CASH FROM (USED IN) OPERATING ACTIVITIES                            380,091           (382,161)        (1,654,377)
_____________________________________________________________________________________________________________________

CASH FLOWS FROM INVESTING ACTIVITIES
   Investment in oil and gas property                                  (114,739)          (702,923)          (901,750)
   Deposit on properties                                               (200,000)                 -         (1,300,000)
_____________________________________________________________________________________________________________________

NET CASH FLOWS USED IN INVESTING ACTIVITIES                            (314,739)          (702,923)        (2,201,750)
_____________________________________________________________________________________________________________________

CASH FLOWS FROM FINANCING ACTIVITIES
   Proceeds on sale of common stock                                           -          3,675,000          3,988,516
   Proceeds from exercised warrants                                     500,000                               500,000
   Advances from related party                                                -                  -             83,239
_____________________________________________________________________________________________________________________

NET CASH PROVIDED BY FINANCING ACTIVITIES                               500,000          3,675,000          4,571,755
_____________________________________________________________________________________________________________________

EFFECT OF EXCHANGE RATE CHANGES ON CASH                                       -                422                  -
_____________________________________________________________________________________________________________________

INCREASE IN CASH                                                        565,352          2,590,338            715,628

CASH, BEGINNING OF PERIOD                                               150,276             19,495                  -
_____________________________________________________________________________________________________________________

CASH, END OF PERIOD                                                  $  715,628       $  2,609,833         $  715,628
=====================================================================================================================


SUPPLEMENTAL CASH FLOW INFORMATION AND
   NONCASH INVESTING AND FINANCING ACTIVITIES:
     Cash paid for interest                                          $        -        $         -          $        -
     Cash paid for income taxes                                      $        -        $         -          $        -
     Common stock issued for acquisition of mineral property         $        -        $         -         $     4,440
     Common stock issued for satisfaction of liability               $        -        $         -         $    50,000
     Common stock issued for consulting fees                         $    8,875        $         -         $     8,875
     Donated services and rent                                       $        -        $         -         $    14,420


   The accompanying notes are an integral part of these financial statements.

</TABLE>

                                       7


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION
________________________________________________________________________________

Mainland Resources Inc. (the "Company") is an exploration stage company that was
incorporated  May 12,  2006 in the State of Nevada  for the  purpose  of mineral
exploration.  During  2008,  the Company  entered  into an option  agreement  on
certain oil and gas leaseholds in the state of Louisiana  (refer to Note 4). The
Company  now  intends  to  locate,  explore,  acquire  and  develop  oil and gas
properties in the United  States.  The Company began  drilling its first well in
October 2008.  The first well was completed at the end of January 2009 and is in
production.  The Company  began  drilling  its second well in April 2009.  It is
expected to be completed by the end of July 2009. The Company began drilling its
third well in May 2009.  It is expected to be  completed by the middle of August
2009.

GOING CONCERN
The Company  commenced  operations  on May 12,  2006.  Although  the Company has
realized revenues, as of May 31, 2009, the Company has an accumulated deficit of
$13,356,394.  The  ability of the  Company  to  continue  as a going  concern is
dependent  on  raising  capital  to fund  ongoing  operations  and carry out its
business plan and ultimately to attain profitable operations. Accordingly, these
factors raise  substantial  doubt as to the  Company's  ability to continue as a
going concern.  These financials do not include any adjustments  relating to the
recoverability  and  classification  of  recorded  asset  amounts or amounts and
classification of liabilities that might result from this uncertainty.  To date,
the Company has funded its initial  operations  by way of private  placements of
common  stock and  advances  from  related  parties.  During  2009,  the Company
completed a private  placement  of  $4,000,000  at $0.67 per unit with each unit
consisting  of one  common  share  and one  half  warrant  at  $1.33  per  share
exercisable  for a period  of one  year  from  issuance  (refer  to Note 5).  In
addition, between March 1, 2009 and June 1, 2009 864,750 warrants were exercised
at $1.33 for net proceeds to the company of $1,153,000.

UNAUDITED INTERIM FINANCIAL STATEMENTS
The accompanying  unaudited interim consolidated  financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information  and  with the  instructions  to Form  10-Q.  They do not
include  all  information  and  footnotes  required by United  States  generally
accepted  accounting  principles  for complete  financial  statements.  However,
except  as  disclosed  herein,  there  have  been  no  material  changes  in the
information  disclosed  in the notes to the  financial  statements  for the year
ended  February 28, 2009  included in the  Company's  Annual Report on Form 10-K
filed  with the  Securities  and  Exchange  Commission.  The  interim  unaudited
financial  statements  should  be  read  in  conjunction  with  those  financial
statements  included  in the  Form  10-K.  In the  opinion  of  Management,  all
adjustments  considered necessary for a fair presentation,  consisting solely of
normal recurring  adjustments,  have been made.  Operating results for the three
months ended May 31, 2009 are not necessarily indicative of the results that may
be expected for the year ending February 28, 2010.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
________________________________________________________________________________

ORGANIZATION
The  Company  was  incorporated  on May 12,  2006 in the  State of  Nevada.  The
Company's fiscal year end is February 28.

BASIS OF PRESENTATION
These financial  statements are presented in United States dollars and have been
prepared  in  accordance  with  United  States  generally  accepted   accounting
principles.

OIL AND GAS PROPERTIES
The  Company  follows  the full cost  method of  accounting  for its oil and gas
operations  whereby all costs related to the acquisition of methane,  petroleum,
and natural gas interests are capitalized. Under this method, all productive and
non-productive  costs  incurred  in  connection  with  the  exploration  for and
development of oil and gas reserves are capitalized. Such costs include land and
lease acquisition  costs,  annual carrying charges of non-producing  properties,
geological and geophysical costs, costs of drilling and equipping productive and
non-productive  wells,  and direct  exploration  salaries and related  benefits.
Proceeds from the disposal of oil and gas properties are recorded as a reduction
of the related  capitalized  costs without  recognition of a gain or loss unless
the  disposal  would  result in a change of 20 percent or more in the  depletion
rate. The Company currently operates solely in the U.S.


                                       8


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________

OIL AND GAS PROPERTIES (CONTINUED)
Depreciation  and depletion of proved oil and gas  properties is computed on the
units-of-production   method  based  upon  estimates  of  proved  reserves,   as
determined by  independent  consultants,  with oil and gas being  converted to a
common unit of measure based on their relative energy content.

The costs of acquisition  and  exploration  of unproved oil and gas  properties,
including  any  related  capitalized   interest  expense,  are  not  subject  to
depletion,  but  are  assessed  for  impairment  either  individually  or  on an
aggregated  basis. The costs of certain  unevaluated  leasehold acreage are also
not  subject to  depletion.  Costs not  subject to  depletion  are  periodically
assessed for possible  impairment  or  reductions  in  recoverable  value.  If a
reduction in  recoverable  value has  occurred,  costs  subject to depletion are
increased or a charge is made  against  earnings  for those  operations  where a
reserve base is not yet established.

Estimated future removal and site  restoration  costs are provided over the life
of  proven  reserves  on  a  units-of-production  basis.  Costs,  which  include
production equipment removal and environmental  remediation,  are estimated each
period by management based on current regulations, actual expenses incurred, and
technology and industry  standards.  The charge is included in the provision for
depletion and depreciation and the actual  restoration  expenditures are charged
to the accumulated provision amounts as incurred.

The Company applies a ceiling test to capitalized  costs which limits such costs
to the aggregate of the estimated  present value,  using a ten percent  discount
rate of the estimated  future net revenues from production of proven reserves at
year end at market  prices less future  production,  administrative,  financing,
site  restoration,  and  income  tax costs  plus the lower of cost or  estimated
market value of unproved  properties.  If  capitalized  costs are  determined to
exceed estimated future net revenues,  a write-down of carrying value is charged
to depletion in the period.

ASSET RETIREMENT OBLIGATIONS
The Company has adopted the  provisions of SFAS No. 143,  "Accounting  for Asset
Retirement Obligations." SFAS No. 143 requires the fair value of a liability for
an asset  retirement  obligation  to be  recognized in the period in which it is
incurred  if a  reasonable  estimate of fair value can be made.  The  associated
asset  retirement  costs are  capitalized as part of the carrying  amount of the
related  oil and gas  properties.  As of May 31,  2009,  there has been no asset
retirement obligations rendered.

USE OF ESTIMATES
The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the reported amounts of revenues and expenses during the period.  Actual results
could differ from those  estimates.  Significant  areas  requiring  management's
estimates  and  assumptions  are  the   determination   of  the  fair  value  of
transactions  involving  common  stock,  stock  based  compensation,   financial
instruments  as well as  deferred  tax  balances  and  asset  impairment  tests.
Further, depreciation,  depletion and amortization of oil and gas properties and
the impairment of oil and gas properties are determined  using  estimates of oil
and gas reserves. There are numerous uncertainties in estimating the quantity of
reserves  and in  projecting  the  future  rates of  production  and  timing  of
development  expenditures,  including future costs to dismantle,  dispose, plug,
and restore the Company's  properties.  Oil and gas reserve  engineering must be
recognized as a subjective  process of estimating  underground  accumulations of
oil and gas that cannot be measured in an exact way.  Proved reserves of oil and
natural gas are  estimated  quantities  that  geological  and  engineering  data
demonstrate with reasonable certainty to be recoverable in the future from known
reservoirs under existing conditions.

FINANCIAL INSTRUMENTS
The fair  value of the  Company's  financial  assets and  financial  liabilities
approximate their carrying values due to the immediate or short-term maturity of
these financial instruments.

CONCENTRATIONS OF CREDIT RISK
Financial  instruments that potentially subject the Company to concentrations of
credit  risk  consist  principally  of cash  and  cash  equivalent  accounts  in
financial  institutions.  As of May  31,  2009,  the  Company's  cash  and  cash
equivalents exceed federally insured limits.


                                       9


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________

EARNINGS (LOSS) PER COMMON SHARE
Basic earnings (loss) per share includes no dilution and is computed by dividing
income available to common stockholders by the weighted average number of common
shares  outstanding for the period.  Dilutive  earnings (loss) per share reflect
the  potential  dilution of  securities  that could share in the earnings of the
Company.  Where  applicable,  dilutive  loss per share is equal to that of basic
loss per share as the effects of stock  options and warrants  have been excluded
as they are anti-dilutive.

REVENUE RECOGNITION
Oil and natural gas revenues are recorded  using the sales  method,  whereby the
Company  recognizes  oil and natural gas revenue  based on the amount of oil and
gas sold to  purchasers,  when  title  passes,  the amount is  determinable  and
collection is reasonably assured. Actual sales of gas are based on sales, net of
the associated  volume charges for processing fees and for costs associated with
delivery,  transportation,  marketing, and royalties in accordance with industry
standards.  Operating costs and taxes are recognized in the same period in which
revenue is earned.

INCOME TAXES
The Company follows the liability  method of accounting for income taxes.  Under
this method,  deferred tax assets and  liabilities are recognized for the future
tax  consequences  attributable to differences  between the financial  statement
carrying  amounts of existing assets and  liabilities  and their  respective tax
balances.  Deferred tax assets and  liabilities  are measured  using  enacted or
substantially  enacted tax rates  expected to apply to the taxable income in the
years in which those  differences  are expected to be recovered or settled.  The
effect  on  deferred  tax  assets  and  liabilities  of a change in tax rates is
recognized  in income in the  period  that  includes  the date of  enactment  or
substantive  enactment.  As at May 31, 2009,  the Company had net operating loss
carryforwards,  however, due to the uncertainty of realization,  the Company has
provided a full valuation  allowance for the deferred tax assets  resulting from
these loss carryforwards.

STOCK-BASED COMPENSATION
The Company has adopted SFAS No. 123(R),  "SHARE-BASED  PAYMENT," which requires
the compensation cost related to share-based payments, such as stock options and
employee stock purchase plans, be recognized in the financial  statements  based
on the grant-date fair value of the award.

The Company accounts for equity  instruments  issued in exchange for the receipt
of goods or  services  from other than  employees  in  accordance  with SFAS No.
123(R) and the conclusions reached by the Emerging Issues Task Force ("EITF") in
Issue No. 96-18.  Costs are measured at the  estimated  fair market value of the
consideration  received or the  estimated  fair value of the equity  instruments
issued,  whichever is more reliably measurable.  The value of equity instruments
issued for  consideration  other than  employee  services is  determined  on the
earliest  of a  performance  commitment  or  completion  of  performance  by the
provider of goods or services as defined by EITF 96-18.

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2009, the FASB issued SFAS No. 165,  SUBSEQUENT EVENTS ("SFAS 165"). SFAS
165  provides   authoritative   accounting   literature  related  to  evaluating
subsequent events that was previously addressed only in the auditing literature,
and is largely similar to the current  guidance in the auditing  literature with
some  exceptions  that are not  intended  to result in  significant  changes  in
practice. SFAS 165 defines subsequent events and also requires the disclosure of
the date through which an entity has evaluated  subsequent  events and the basis
for that date.  SFAS 165 is  effective  on a  prospective  basis for  interim or
annual  financial  periods ending after June 15, 2009. We plan to adopt SFAS 165
in the  second  quarter  of Fiscal  2010 and do not expect it to have a material
impact on our consolidated financial statements.

In May 2008, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
163,  ACCOUNTING FOR FINANCIAL GUARANTEE INSURANCE CONTRACTS - AN INTERPRETATION
OF FASB  STATEMENT  NO.  60.  SFAS 163  requires  that an  insurance  enterprise
recognize a claim  liability prior to an event of default when there is evidence
that credit  deterioration has occurred in an insured financial  obligation.  It
also  clarifies  how  Statement  60 applies  to  financial  guarantee  insurance
contracts,  including the  recognition and measurement to be used to account for
premium revenue and claim liabilities,  and requires expanded  disclosures about
financial  guarantee  insurance   contracts.   It  is  effective  for  financial
statements issued for fiscal years beginning after December 15, 2008, except for
some disclosures about the insurance  enterprise's  risk-management  activities.


                                       10


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________

RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

SFAS 163 requires that disclosures about the  risk-management  activities of the
insurance enterprise be effective for the first period beginning after issuance.
Except for those disclosures,  earlier application is not permitted. The Company
has  determined  that the adoption of this  standard did not have a  significant
impact on its financial position, cash flows or results of operations.

In March  2008,  the FASB  issued SFAS No.  161,  DISCLOSURES  ABOUT  DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES ("SFAS 161"). SFAS 161 is intended to improve
financial  reporting  about  derivative  instruments  and hedging  activities by
requiring  enhanced  disclosures to enable investors to better  understand their
effects on an  entity's  financial  position,  financial  performance,  and cash
flows. SFAS 161 achieves these improvements by requiring  disclosure of the fair
values of derivative instruments and their gains and losses in a tabular format.
It also  provides  more  information  about an entity's  liquidity  by requiring
disclosure of  derivative  features that are credit  risk-related.  Finally,  it
requires  cross-referencing within footnotes to enable financial statement users
to locate important information about derivative  instruments.  SFAS 161 will be
effective for financial  statements  issued for fiscal years and interim periods
beginning after November 15, 2008, and will be adopted by the Company  beginning
in the first  quarter  of fiscal  2010.  The  Company  has  determined  that the
adoption of this  standard did not have a  significant  impact on its  financial
position, cash flows or results of operations.

In December  2007,  the FASB issued  SFAS No.  160,  NONCONTROLLING  INTEREST IN
CONSOLIDATED FINANCIAL STATEMENTS,  AN AMENDMENT OF ARB NO. 51 ("SFAS No. 160"),
which will change the  accounting  and reporting for minority  interests,  which
will  be  recharacterized  as  noncontrolling  interests  and  classified  as  a
component of equity  within the  consolidated  balance  sheets.  SFAS No. 160 is
effective as of the beginning of an entity's  first fiscal year  beginning on or
after  December  15,  2008.  Earlier  adoption  is  prohibited.  The Company has
determined that the adoption of this standard did not have a significant  impact
on its financial position, cash flows or results of operations.

In  December  2007,  the FASB  issued  SFAS No.  141  (Revised  2007),  BUSINESS
COMBINATIONS  ("SFAS No.  141R").  SFAS No. 141R will change the  accounting for
business combinations. Under SFAS No. 141R, an acquiring entity will be required
to recognize all the assets acquired and liabilities assumed in a transaction at
the  acquisition-date  fair value with  limited  exceptions.  SFAS No. 141R will
change the accounting  treatment and disclosure for certain  specific items in a
business   combination.   SFAS  No.  141R  applies   prospectively  to  business
combinations  for which the acquisition date is on or after the beginning of the
entity's first annual  reporting period beginning on or after December 15, 2008.
Accordingly,  any business combinations  completed by the Company prior to March
1, 2009 will be recorded and disclosed  following existing GAAP. The Company has
determined that the adoption of this standard did not have a significant  impact
on its financial position, cash flows or results of operations.

NOTE 3 - OIL AND GAS PROPERTIES
________________________________________________________________________________

EAST HOLLY PROSPECT
On February 27, 2008, the Company entered into an option  agreement (the "Option
Agreement") with Kingsley Resources,  Inc.  ("Kingsley"),  pursuant to which the
Company  acquired  all the  right,  title and  interest  Kingsley  has in and to
certain  leasehold  estates in the state of Louisiana  ("the Leases") which were
the subject of a purchase  agreement  dated  December  11,  2007,  and  modified
February 1, 2008  (collectively,  the "Leasehold  Purchase  Agreement")  between
Kingsley  and Permian  Basin  Acquisition  Fund  ("Permian"),  pursuant to which
Kingsley  had the right to acquire the  sub-surface  rights  provided for in the
Leases.  In order to  complete  the  acquisition  of the Leases the  Company was
required  to pay  $100,000  on April  2,  2008 to  Kingsley  and  assume  all of
Kingsley's  obligations  under the Leasehold  Purchase  Agreement.  On March 14,
2008,  the Company  completed the Option  agreement  and the Leasehold  Purchase
Agreement at a total cost of $687,596, which includes the $100,000 that was paid
on April 2, 2008, for approximately 2,551 net acres.

COTTON VALLEY/ HAYNESVILLE
The Company has leased various other properties totalling  approximately 144 net
acres,  consisting of  approximately 84 net acres leased as of February 29, 2008
and added 60 net acres  leased  during the year ended  February  28, 2009 for an
additional  consideration of $22,753.  These additional property leases,  within
the Cotton  Valley/Haynesville  trend in the state of  Louisiana,  are for three
year terms.  The Company has a 100%  Working  Interest  and a 75% N.R.I.  in the
leases comprising a total of 2,695 net acres.


                                       11


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 3 - OIL AND GAS PROPERTIES (CONTINUED)
________________________________________________________________________________

PETROHAWK VENTURE AGREEMENT
On July 14, 2008,  The Company  entered into a binding  venture  agreement  with
Petrohawk  Energy  Corporation  ("Petrohawk")  for the joint  development of the
Haynesville Shale on the Company's  properties ("the Leases") in De Soto Parish,
Louisiana.  Effective  August 4, 2008,  the Company  entered  into a  definitive
binding agreement with Petrohawk consummating the transaction on July 14, 2008.

Under the terms of the Agreement,  Petrohawk has agreed to pay 100% of the costs
of  development  associated  with the first well drilled below the Cotton Valley
Formation,  including drilling,  completing and fracture stimulating, as well as
costs up to and including pipeline connection.  Petrohawk has also agreed to pay
80% of all costs of the second well  drilled on the Leases below the base of the
Cotton Valley with the Company  paying the  remaining 20% of the costs.  For the
third and all  subsequent  wells  drilled  on the  Leases  below the base of the
Cotton Valley Formation, Petrohawk will pay 60% and the Company will pay 40%.

The Company  will  transfer  60% of its De Soto Parish  leases to  Petrohawk  at
closing,  but only as the  Leases  relate  to all  depths  below the base of the
Cotton Valley  Formation,  and  specifically  the Haynesville  Shale.  Petrohawk
agrees to gather and market the Company's  production from above the base of the
Cotton Valley Formation, pursuant to a mutually acceptable agreement.

GRIFFITHS 11- #1
The first  well under the  Petrohawk  Agreement,  the  Griffiths  11- #1,  began
drilling in October 2008.  The well  commenced  production at the end of January
2009.

STEVENSON DOUGLAS LLC. 16 - #1
The second well under the Petrohawk  Agreement,  the Steven Douglas LLC 16 - #1,
began  drilling in April 2009.  The Company  expects the well to be completed by
the end of July 2009.

DEHAN 15 - #1-H
The third well under the Petrohawk  Agreement,  the Steven  Douglas LLC 16 - #1,
began drilling in May 2009. The Company  expects the well to be completed by the
middle of August 2009.

MISSISSIPPI PROSPECT
On September 3, 2008, the Company signed an Option  Agreement with Westrock Land
Corp to  acquire  5,000 net acres in mineral  oil and gas leases  located in the
State of Mississippi.  In accordance with the terms and provisions of the Option
Agreement;  (i ) the Company will acquire a 100% working  interest and a 75% net
revenue  interest  in the  Leases;  (ii) the  Company  has agreed to pay certain
acquisition  costs per net  mineral  acres and also paid a  $500,000  deposit on
September  3, 2008 to secure  the  Option  Agreement;  (iii) the  balance of the
acquisition  costs totalling  $2,275,000 will be due and payable upon completion
of the due  diligence,  to be completed by the Company no later than October 15,
2008.  The Option  Agreement  was  subsequently  extended on each of October 15,
2008,  November  30,  2008,  April 16, 2009 and June 1, 2009  whereby the option
period has been  extended  until  December  31,  2009.  Additional  deposits  of
$250,000,  $100,000,  $250,000,  $100,000,  $100,000 and  $100,000  were paid on
October 17, 2008,  December 1, 2008,  December 29, 2008,  April 27, 2009, May 6,
2009 and June 5, 2009 for a total deposit to date of $1,400,000  (May 31, 2009 -
$1,300,000; February 28, 2009 - $1,100,000).


                                       12


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 3 - OIL AND GAS PROPERTIES (CONTINUED)

The Company's Oil and Gas properties are made up as follows:

                                            May 31,       February 29,
                                             2009             2009
______________________________________________________________________


Oil and Gas Properties:
   Proved, subject to depletion           $   787,011      $ 787,011
   Unproved, not subject to depletion       1,404,879              -
______________________________________________________________________

                                            2,191,890        787,011
   Accumulated depletion                      (36,918)       (12,000)
______________________________________________________________________

Total Oil and Gas Properties              $ 2,154,972      $ 775,011
======================================================================


The following is a summary of the transactions  involving the Company's unproven
properties not subject to depletion:

                               Acquisition       Development
                                  Costs             Costs             Total
______________________________________________________________________________


Balance, February 28, 2008      $   9,176        $         -       $     9,176

Incurred during the year          702,923             74,912           777,835
Reallocated to proven and
   subject to depletion          (712,099)           (74,912)         (787,011)
______________________________________________________________________________

Balance, February 29, 2008              -                  -                 -

Incurred during the period              -          1,404,879         1,404,879
______________________________________________________________________________


Balance, May 31, 2009           $       -        $ 1,404,879       $ 1,404,879
==============================================================================


Depletion of proved oil and gas properties  during the period ended May 31, 2009
was  computed on the  units-of-production  method  based upon  estimated  proved
reserves of 8.369 Bcf,  reserves  produced  during the period of 269,075 Mcf and
net  capitalized  costs  to  be  amortized  totaling  $775,011,  resulting  in a
depletion cost of $24,918 for the period and total  accumulated  depletion costs
as of May 31, 2009 of $36,918.

NOTE 4 - STOCKHOLDERS' EQUITY
________________________________________________________________________________

(A)      SHARE CAPITAL
The Company's  capitalization  is 200,000,000  common shares with a par value of
$0.0001 per share.

On February 25, 2008, the directors of the Company approved a special resolution
to undertake a forward split of the common stock of the Company on a basis of 20
new shares for 1 old share and was  effective  March 11, 2008.  On May 12, 2008,
the  directors  of the  Company  approved a special  resolution  to  undertake a
forward  split of the common  stock of the  Company on a basis of 1.5 new shares
for 1 old share and was effective March 29, 2008.

All references in these financial  statements to number of common shares,  price
per share and weighted average number of common shares  outstanding prior to the
20:1 forward  stock split on March 11, 2008 and the 1.5:1 forward stock split on
May 29, 2008 have been  adjusted to reflect  these stock splits on a retroactive
basis, unless otherwise noted.


                                       13


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 4 - STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
________________________________________________________________________________

(B)      PRIVATE PLACEMENTS
On June 15, 2006, the Company  issued  6,000,000  unregistered  shares of common
stock at $0.00003 per share for proceeds of $172.

On October 6, 2006, the Company issued 12,510,000  unregistered shares of common
stock at a price of $0.0014 per share for proceeds of $17,892.

On October 15, 2007, the Company issued 12,000,000 unregistered shares of common
stock at a price of $0.0017 per share for proceeds of $20,452.

Between May 1, 2008 and July 22, 2008, the Company completed a private placement
of 6,000,000 unregistered units at $0.67 per unit for proceeds of $4,000,000. Of
this  amount,  $50,000  was by way of a  settlement  of debt  and the  remaining
$3,950,000  was  received in cash.  Each unit  consists of one common  share and
one-half  non-transferable  share purchase warrant;  one whole  non-transferable
purchase warrant is exercisable at $1.33 per share for a period of one year from
the date of issuance ending on May 1, 2009.

(C)      OTHER ISSUANCES
On July 15, 2006, the Company issued 3,105,000 shares of common stock at a price
of $0.0014 per share on settlement of $4,440 for mineral property acquisition.

On March 17,  2009,  the  Company  issued  2,500  shares  of common  stock at an
estimated  fair  value  of $3.55  per  share  as per the  terms of a  consulting
agreement that became effective March 1, 2009.

Subsequent  to the period on June 15, 2009,  the Company  issued 2,500 shares of
common stock at an estimated fair value of $2.90 per share as per the terms of a
consulting agreement that became effective March 1, 2009.

(D)      SHARE PURCHASE WARRANTS
Subsequent to the year end on April 29, 2009, the Company extended expiration of
the 3,000,000 warrants from May 1, 2009 to June 1, 2009.

As of May 31,  2009,  a total of 375,000  warrants  were  exercised at $1.33 per
share with net proceeds of $500,000 to the Company.

Subsequent to the period on June 1, 2009,  489,750  warrants  were  exercised at
$1.33 per share with net  proceeds of $653,000 to the Company and the  remaining
2,135,250 warrants expired unexercised.

Details of the Company's share purchase warrants  outstanding as of May 31, 2009
are as follows:

Exercise       Weighted        Number of warrants
 price       average price     to purchase shares     Expiry Date
__________________________________________________________________

 $1.33           $1.33             2,625,000          June 1, 2009


                                       14


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 4 - STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)

(D)      SHARE PURCHASE WARRANTS (CONTINUED)
The Company's share purchase warrants activity for the period ended May 31, 2009
is summarized as follows:

                                                                Weighted average
                                            Weighted average      remaining In
                               Number of     exercise price       contractual
                               Warrants        per share        life (in years)
________________________________________________________________________________

Balance, February 29, 2008             -         $    -                  -
Issued                         3,000,000           1.33                  -
Expired                                -              -                  -
Exercised                              -              -                  -
________________________________________________________________________________

Balance,  February 29, 2008    3,000,000           1.33               0.17
Issued                                 -              -                  -
Expired                                -              -                  -
Exercised                       (375,000)          1.33                  -
________________________________________________________________________________

Balance, May 31, 2009          2,625,000         $ 1.33               0.17
================================================================================


NOTE 5 - STOCK OPTION PLAN
________________________________________________________________________________

On April 7, 2008, the Board of Directors of the Company  ratified,  approved and
adopted a Stock  Option  Plan for the  Company  allowing  for the grant of up to
2,200,000 options to acquire common shares with terms of up to 10 years. On July
9, 2008,  the Board of Directors of the Company  ratified,  approved and amended
the Stock  Option  Plan for the  Company  increasing  the  allowable  grant from
2,200,000  options to 3,800,000  options.  In the event an optionee ceases to be
employed by or to provide  services to the Company for reasons other than cause,
any Stock  Option  that is vested and held by such  optionee  maybe  exercisable
within up to ninety  calendar  days after the  effective  date that his position
ceases. No Stock Option granted under the Stock Option Plan is transferable. Any
Stock  Option held by an optionee at the time of his death may be  exercised  by
his estate  within one year of his death or such  longer  period as the Board of
Directors may determine.

As approved by the Board of  Directors,  on April 7, 2008,  the Company  granted
2,100,000  fully  vested  stock  options  to  certain  officers,  directors  and
management  of the Company at $1.17 per share for terms of ten years.  The total
fair value of these  options at the date of grant was estimated to be $2,457,000
and was determined using the Black-Scholes option pricing model with an expected
life of 5 years,  a risk free interest rate of 2.75%, a dividend yield of 0% and
expected  volatility  of 260% and was  recorded  as a stock  based  compensation
expense in 2009.

As approved by the Board of Directors, between July 9, 2008 and August 19, 2008,
the Company  granted a total of 1,350,000  fully vested stock options to certain
officers and directors of the Company at prices  ranging from $4.20 per share to
$6.35 per share for terms of ten years. The total fair value of these options at
the date of grant was estimated to be $7,157,685  and was  determined  using the
Black-Scholes  option  pricing  model with the following  assumptions;  expected
lives of 5 years, risk free interest rates ranging from 3.07% - 3.12%,  dividend
yields of 0% and expected  volatility  of 260% and was recorded as a stock based
compensation expense in 2009.

As approved by the Board of Directors, on November 18, 2008, the Company granted
a total of 250,000  fully vested  stock  options to a director of the Company at
$5.00 per share for terms of ten years. The total fair value of these options at
the date of grant was estimated to be $1,182,500  and was  determined  using the
Black-Scholes option pricing model with the following  assumptions;  an expected
life of 5 years,  a risk free interest rate of 2.22%, a dividend yield of 0% and
expected  volatility  of 260% and was  recorded  as a stock  based  compensation
expense in 2009.


                                       15


<PAGE>


                             MAINLAND RESOURCES INC.
                         (An Exploration Stage Company)

                          NOTES TO FINANCIAL STATEMENTS
                                  MAY 31, 2009
                                   (UNAUDITED)
________________________________________________________________________________


NOTE 5 - STOCK OPTION PLAN (CONTINUED)
________________________________________________________________________________

As approved by the Board of Directors,  on February 4, 2009, the Company granted
a total of 300,000 fully vested stock options to two directors of the Company at
$3.00 per share for terms of ten years. The total fair value of these options at
the  date of  grant  was  estimated  at  $1,197,000  and  determined  using  the
Black-Scholes option pricing model with the following  assumptions;  an expected
life of 5 years,  a risk free interest rate of 1.91%, a dividend yield of 0% and
expected  volatility  of 260% and was  recorded  as a stock  based  compensation
expense in 2009.

Also  effective  February 4, 2009,  the  Company  cancelled  900,000  previously
granted  and fully  vested  options to a former  director at $1.17 per share and
repriced  to $3.00 per share,  1,600,000  previously  granted  and fully  vested
options with original  exercise prices ranging from $4.20 per share to $6.35 per
share with all other terms remaining unchanged from the original issuances.  The
estimated  incremental  fair  value  resulting  from the  modification  of these
options of $8,500 was recorded as a stock based compensation expense in 2009.

The  Company's  stock  option  activity  for the  period  ended May 31,  2009 is
summarized as follows:

                                                                Weighted average
                                            Weighted average      remaining In
                               Number of     exercise price       contractual
                                Options        per share        life (in years)
________________________________________________________________________________

Balance, February 29, 2008             -         $    -                  -
Granted                        4,000,000           2.82                  -
Exercised                              -              -                  -
Expired / cancelled             (900,000)          1.17
________________________________________________________________________________

Balance, February 28, 2009     3,100,000           2.29               9.36
================================================================================

Granted                                -              -                  -
Exercised                              -              -                  -
Expired / cancelled                    -              -
________________________________________________________________________________

Balance, May 31, 2009          3,100,000         $ 2.29               9.11
================================================================================


NOTE 6 - RELATED PARTY TRANSACTIONS
________________________________________________________________________________

The Company paid a total of $35,372 in management fees to officers and directors
of the Company for the period ended May 31, 2009 (May 31, 2008 - $15,500).


NOTE 7 - SUBSEQUENT EVENTS
________________________________________________________________________________

On June 1, 2009,  489,750  warrants  were  exercised at $1.33 per share with net
proceeds of $653,000 to the Company.

On June 15,  2009,  the  Company  issued  2,500  shares  of  common  stock at an
estimated  fair  value  of $2.90  per  share  as per the  terms of a  consulting
agreement that became effective March 1, 2009 (refer to Note 4).

On June 22, 2009,  the Company  entered into an option  agreement  with Westrock
Land Corp.  to  acquire  up to 8,000 net acres in mineral  oil and gas leases in
certain  properties  located in the State of Mississippi.  The Company has until
August 31, 2009 to complete its due diligence.


                                       16


<PAGE>


                           FORWARD LOOKING STATEMENTS

Statements  made in this Form 10-Q that are not  historical or current facts are
"forward-looking  statements"  made  pursuant to the safe harbor  provisions  of
Section  27A of the  Securities  Act of 1933 (the  "Act") and Section 21E of the
Securities Exchange Act of 1934. These statements often can be identified by the
use  of  terms  such  as  "may,"  "will,"  "expect,"  "believe,"   "anticipate,"
"estimate," "approximate" or "continue," or the negative thereof. We intend that
such  forward-looking  statements  be  subject  to the  safe  harbors  for  such
statements.  We wish to caution  readers not to place undue reliance on any such
forward-looking  statements,   which  speak  only  as  of  the  date  made.  Any
forward-looking  statements represent  management's best judgment as to what may
occur in the future. However,  forward-looking  statements are subject to risks,
uncertainties  and important  factors beyond our control that could cause actual
results and events to differ  materially from  historical  results of operations
and events  and those  presently  anticipated  or  projected.  We  disclaim  any
obligation  subsequently  to revise any  forward-looking  statements  to reflect
events or  circumstances  after the date of such  statement  or to  reflect  the
occurrence of anticipated or unanticipated events.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

GENERAL

Mainland Resources,  Inc. was incorporated under the laws of the State of Nevada
on May 12, 2006 and has been engaged in the business of acquisition, exploration
and development of mineral  properties in the United States since its inception.
Our shares of common stock trade on the  Over-the-Counter  Bulletin  Board under
the symbol  "MNLU:OB."  We are a natural  resource  exploration  and  production
company currently engaged in the exploration, acquisition and development of oil
and gas  properties in the United States and within North  America.  Our primary
activity and focus is our lease in East Holly Field, De Soto Parish in northwest
Louisiana (the "De Soto Parish") as more fully described below. To date, we have
acquired  approximately  2,695 net acres within the De Soto Parish. We have also
leased various other properties totaling  approximately 144 net acres within the
Cotton  Valley/Haynesville  trend  in the  State  of  Louisiana  as  more  fully
described below.

Please note that throughout this Quarterly  Report,  and unless otherwise noted,
the words "we," "our," "us," the "Company," or "Mainland  Resources,"  refers to
Mainland Resources, Inc.

CURRENT BUSINESS OPERATIONS

We are a natural resource  exploration and production  company currently engaged
in the exploration, acquisition and development of oil and gas properties in the
United States and within North  America.  Our primary  activity and focus is our
lease in the De Soto Parish. To date, we have acquired  approximately  2,695 net
acres within the De Soto Parish.  We have also leased  various other  properties
totaling approximately 144 net acres within the Cotton  Valley/Haynesville trend
in the State of Louisiana as more fully described below.


                                       17


<PAGE>


EAST HOLLY FIELD, DE SOTO PARISH, LOUISIANA

On  February  27,  2008,  we  entered  into an  option  agreement  (the  "Option
Agreement") with Kingsley  Resources,  Inc.,  Nevada  corporation  ("Kingsley"),
pursuant to which we acquired all the right,  title and interest Kingsley has in
and to certain  leasehold  estates (the "Leases") located in East Holly Field of
the De Soto  Parish.  The  Leases  create a  contiguous  block of acreage on the
southeast  flank of the East  Holly  Field.  The  Leases  were the  subject of a
certain purchase agreement dated December 11, 2007 and modified February 1, 2008
(collectively,  the "Leasehold Purchase Agreement") between Kingsley and Permian
Basin  Acquisition  Fund  ("Permian"),  pursuant to which Kingsley  acquired the
sub-surface rights provided for in the Leases.

In  accordance  with the terms  and  provisions  of the  Option  Agreement:  (i)
Kingsley granted to us all of its right, title and interest in and to the Leases
and we  assumed  all  rights,  duties  and  obligations  of  Kingsley  under the
Leasehold Purchase Agreement;  (ii) we agreed to pay to Kingsley $100,000, which
is payable as a reimbursement of a deposit paid by Kingsley to Permian under the
Leasehold  Purchase  Agreement;  and (iii) on or about  March 15, 2008 or at the
time we pay the $100,000 to Kingsley  under the Option  Agreement and such other
amounts  to  Permian  as  required  of  Kingsley  under the  Leasehold  Purchase
Agreement,  the right,  title and interest of Permian and Kingsley in the Leases
will be transferred and delivered to us, subject to residual royalty payment and
other rights  reserved  under the  Leasehold  Purchase  Agreement and the Option
Agreement by Permian and Kingsley.

On March 14, 2008,  we paid to Permian the aggregate  amount of $587,596,  which
amount did not include the $100,000  required to be paid by us to Kingsley under
the terms of the Option Agreement, the $100,000 was paid to Kingsley on April 2,
2008.  In  accordance  thereof,  the right,  title and  interest  of Permian and
Kingsley in the Leases were transferred to us effective March 14, 2008 by way of
assignment.  As of the date of this  Quarterly  Report,  we have  completed  the
Option  Agreement  and the  Leasehold  Purchase  Agreement  at a  total  cost of
$687,596 for approximately 2,551 net acres.

COTTON VALLEY/HAYNESVILLE

As of the date of this Quarterly Report, we have leased various other properties
totaling  approximately  144 net acres  consisting of approximately 84 net acres
leased as of  February  29,  2008 and an  additional  60 net acres  leased as of
February  28, 2009 for payment of  additional  consideration  of $22,753.  These
additional  property  leases within the Cotton  Valley/Haynesville  trend in the
State of  Louisiana  are for a three-year  term  period.  We have a 100% working
interest and a 75% net revenue interest in the leases.

DRILLING  INITIATIVES.  As of the date of this Quarterly  Report, in conjunction
with our joint venture partner, Petrohawk Energy Corporation ("Petrohawk"),  our
technical team (guided by management),  will determine our drilling initiatives.
These  initiatives are based on project  priority,  leasehold  requirements  and
availability  of resources,  access,  costs and a number of factors that go into
strategic planning.  With regards to the East Holly Field, management intends to
drill its initial well to a depth similar to that of other area  participants in
the  Cotton  Valley  and  Hosston  formations  and the  Haynesville  Shale.  The


                                       18


<PAGE>


technical team in conjunction  with our joint venture partner expects that other
wells drilled in this region will be based on the detailed  data gained  through
the initial well drilling process.

PETROHAWK AGREEMENT.  Effective on July 14, 2008, our Board of Directors entered
into a  binding  venture  agreement  (the  "Letter  Agreement")  with  Petrohawk
relating to the joint  development of acreage of the Company's  leases in DeSoto
Parish,  Louisiana.  In accordance  with the terms and  provisions of the Letter
Agreement:  (i)  Petrohawk  agreed  to pay  100%  of the  costs  of  development
associated  with the first  well  drilled  below the  Cotton  Valley  Formation,
including drilling,  completing and fracture stimulating, as well as costs up to
and  including  pipeline  connection;  (ii)  Petrohawk  agreed to pay 80% and we
agreed to pay 20% of all costs of the second well drilled  below the base of the
Cotton Valley Formation;  and (iii) Petrohawk agreed to pay 60% and we agreed to
pay 40% of all  costs of the third  well  drilled  below the base of the  Cotton
Valley  Formation.  In accordance  with the further terms and  provisions of the
Letter  Agreement,  we agreed to transfer 60% of our leases in the DeSoto Parish
to Petrohawk at closing, but only as such leases related to all depths below the
base of the Cotton Valley  Formation and  specifically  the  Haynesville  Shale.
Petrohawk further agreed to gather and market our production from above the base
of the Cotton Valley Formation pursuant to a mutually acceptable agreement.  The
Letter Agreement was subject to due diligence.

Effective  August 4, 2008, we entered into a definitive  binding  agreement with
Petrohawk   consummating   the  transaction   described  above  (the  "Peotrhawk
Agreement"),  together with associated  assignment,  conveyance and bill of sale
(the  "Assignment").  In  accordance  with  the  terms  and  provisions  of  the
Assignment,  we have  effectively  transferred  and conveyed to Petrohawk  sixty
percent (60%) of our 100% right,  title and interest in and to the leases in the
DeSoto Parish.  Petrohawk has been designated as the operator on all development
relating to the leases.

GRIFFITHS  11-#1  WELL.  On October  20,  2008,  the  Griffith  Well No. 10H was
spudded.  The Griffiths  11-#1 well  commenced  production at the end of January
2009. The  approximate  reading for total gas produced from the Griffiths  11-#1
well and shipped to market through March 31, 2009 was reported at 832,228 MCF or
..832 BCF. We believe that the  recoverable  reserves for the Griffith 11-#1 well
may  ultimately be from 7.5 BCF to 15.81 BCF. The 15.81 BCF rate was  determined
by a reserve  report  prepared by T.W.  McQuire & Associates,  Inc. The ultimate
recovery  was  determined  by suing a type curve that uses 80%  decline  for the
first year  followed by a 30% decline for the second  year,  15% decline for the
third year, and a 10% decline over the remaining expected life of the well.

STEPHENSON DOUGLAS LLC 16-#1. The second well under the Petrohawk Agreement, the
Stevenson  Douglas LLC 16-#1 well,  began drilling in April 2009. As of the date
of this Quarterly Report,  the Stephenson Douglas LLC 16-#1 well has spud and we
cemented  surface  casing at about 1800 feet.  As of the date of this  Quarterly
Report,  the  Stephenson  Douglas LLC 16-#1 has been  successfully  drilled to a
depth of 10,700 feet and 7 5/8 inch intermediate casing has been run on the well
to this  depth.  The rig has now been  released.  Management  believes  that the
Stephenson Douglas LLC 16-#1 well shows similar potentially  productive sands in
the Hosston and Cotton Valley  formations  to those  discovered in the Griffiths


                                       19


<PAGE>


11-#1Well. We are awaiting the scheduled arrival of a larger rig capable of whip
stocking the well and drilling the lateral  portion of the  wellbore.  We expect
the well to be completed by the end of July 2009.

DEHAN 15 -#1-H.  The third  well  under the  Petrohawk  Agreement,  the Dehan 15
#1-well, began drilling in May 2009. As of the date of this Quarterly Report, we
expect the well to be completed by the middle of August 2009.

MISSISSIPPI PROSPECT/WESTROCK LAND CORP.
Effective on September 4, 2008, our Board of Directors  authorized the execution
of an option  agreement (the "2008 Option  Agreement")  with Westrock Land Corp.
("Westrock") to acquire 5,000 net acres in mineral oil and gas leases located in
the  State of  Mississippi  (the  "Leases").  In  accordance  with the terms and
provisions  of the 2008 Option  Agreement:  (i) we will  acquire a 100%  working
interest  and a 75% net revenue  interest in the Leases;  (ii) we have agreed to
pay  certain  acquisition  costs per net  mineral  acre and also paid a $500,000
deposit  to  secure  the  2008  Option  Agreement;  (iii)  the  balance  of  the
acquisition  costs will be due and payable upon completion of the due diligence,
which 2008  Option  Agreement  is  subject to the  completion  of  standard  due
diligence  review by us to be completed no later than October 15, 2008; and (iv)
upon closing scheduled no later than October 15, 2008,  Westrock shall assign to
us all of its right,  title and  interest in and to the Leases free and clear of
all  liens  and  encumbrances.  On  October  15,  2008,  November  30,  2008 and
subsequently on April 16, 2009, the 2008 Option Agreement was extended  pursuant
to which the option period is currently extended until June 1, 2009.  Additional
deposits of $250,000,  $100,000,  $250,000,  $100,000 and $100,000  were paid on
October 17, 2008, December 1, 2008, December 29, 2008 and April 27, 2009, May 6,
2009 and June 5, 2009  respectively,  for a total  deposit to date of $1,400,000
(May 31, 2009 - $1,300,000,  February 28, 2009 - $1,100,000) in connection  with
these extensions.

Effective on June 23, 2009, our Board of Directors authorized the execution of a
further option agreement (the "2009 Option  Agreement") with Westrock to acquire
up to 8,000 net acres in mineral oil and gas leases in certain  property located
in the State of  Mississippi  (the  "Acquired  Properties").  Westrock  owns all
rights,  title and interest in all depths pursuant to certain oil and gas leases
comprising the Acquired Properties.  In accordance with the terms and provisions
of the 2009 Option Agreement:  (i) we shall pay to Westrock  consideration based
on per net  mineral  acre,  which  is due and  payable  upon  completion  of due
diligence by us and execution of appropriate  assignments;  (ii) Westrock grants
to us until  August  31,  2009 to  complete  our due  diligence;  and  (iii) the
effective  date  of  the  conveyance  of  the  Acquired   Properties   shall  be
approximately August 31, 2009.

RESULTS OF OPERATION

We are an exploration stage company and although we have realized  revenues,  we
have  incurred  recurring  losses to date.  Our financial  statements  have been
prepared assuming that we will continue as a going concern and, accordingly,  do
not include adjustments relating to the recoverability and realization of assets
and classification of liabilities that might be necessary should we be unable to
continue in operation.  We expect we will require additional capital to meet our
long term operating requirements. We expect to raise additional capital through,
among other things, the sale of equity or debt securities.


                                       20


<PAGE>


The  summarized  financial data set forth in the table below is derived from and
should be read in conjunction  with our unaudited  financial  statements for the
three month periods ended May 31, 2009 and May 31, 2008,  including the notes to
those  financial  statements  which are included in this Quarterly  Report.  The
following discussion contains forward-looking statements that reflect our plans,
estimates and beliefs.  Our actual  results could differ  materially  from those
discussed in the forward looking  statements.  Our audited financial  statements
are stated in United States  Dollars and are prepared in accordance  with United
States Generally Accepted Accounting Principles.





























                                       21


<PAGE>


The following  table sets forth selected  financial  information for the periods
indicated.

RESULTS OF OPERATION

                                            THREE MONTH         FOR THE PERIOD
                                            PERIOD ENDED       FROM MAY 12, 2006
                                            MAY 31, 2009        (INCEPTION) TO
                                          AND MAY 31, 2008       MAY 31, 2009
________________________________________________________________________________

REVENUES
   Oil and gas revenue                  $909,121            -    $  1,425,700

GENERAL AND ADMINISTRATIVE EXPENSES
   Operating costs and taxes             215,123            -         364,446
   Depletion allowance                    24,918            -          36,918
   Consulting fees                       151,134      317,780         746,508
   Management fees and rent fees-
      related party                       35,372       15,500         176,192
   Marketing expenses                     17,495            -         938,602
   Mineral property costs                      -            -          14,510
   Office and general                     43,379      170,744         185,426
   Professional fees                      46,405       31,567         357,715
   Salary expense                              -    2,457,000      12,002,685
                                        _____________________________________

Net operating income (loss)              375,295   (2,992,591)    (13,397,302)

Other income
   Gain on settlement of debt                  -       33,239          33,239
   Interest income                           270            -           7,669

Net income (loss)                        375,565   (2,959,352)    (13,356,394)
   Foreign currency translation
      adjustment                               -          422               -

Comprehensive income (loss)              375,565   (2,958,930)    (13,356,394)

We have incurred  recurring  losses to date. Our financial  statements have been
prepared assuming that we will continue as a going concern and, accordingly,  do
not include adjustments relating to the recoverability and realization of assets
and classification of liabilities that might be necessary should we be unable to
continue in operation.

We expect we will  require  additional  capital to meet our long term  operating
requirements. We expect to raise additional capital through, among other things,
the sale of equity or debt securities.


                                       22


<PAGE>


THREE MONTH PERIOD  ENDED MAY 31, 2009  COMPARED TO THREE MONTH PERIOD ENDED MAY
31, 2008.

Our  comprehensive  income for the three  month  period  ended May 31,  2009 was
$375,565 compared to a comprehensive loss of ($2,958,930) during the three month
period ended May 31, 2008 (an increase in  comprehensive  income of $2,583,365).
During the three month period ended May 31, 2009,  we generated  $909,121 in oil
and gas revenue  compared to $-0- generated  during the three month period ended
May 31, 2008.

During the three  month  period  ended May 31,  2009,  we  incurred  general and
administrative  expenses of $533,826 compared to $2,992,591  incurred during the
three month ended May 31, 2008 (a  decrease of  $2,458,765).  These  general and
administrative  expenses  incurred  during the three month  period ended May 31,
2009 consisted of: (i) operating costs and taxes of $215,123 (2008:  $-0-); (ii)
depletion  allowance of $24,918 (2008:  $-0-); (iii) consulting fees of $151,134
(2008: $317,780);  (iv) management and rent fees-related party of $35,372 (2008:
$15,500);  (v)  marketing  expenses  of $17,495  (2008:  $-0-);  (vi) office and
general of $43,379 (2008:  $170,744);  (vii) professional fees of $46,405 (2008:
$31,567); and (viii) salary expense of $-0- (2008: $2,457,000).

Of the $533,826 incurred as general and administrative expenses during the three
month period ended May 31, 2009, we incurred  management fees of $35,372 payable
to our officers and directors.

General and administrative expenses incurred during the three month period ended
May 31, 2009  compared to the three month  period  ended May 31, 2008  decreased
primarily due to the decrease in salary expense to $-0- from  $2,457,000  during
the three month  period  ended May 31, 2008  relating to the  valuation of stock
based  compensation,  the decrease in consulting  fees to $151,134 from $317,780
during the three month period ended May 31, 2008, and the decrease in office and
general to $43,379  from  $170,744  during the three month  period ended May 31,
2008. General and administrative  expenses generally include corporate overhead,
financial and  administrative  contracted  services,  marketing,  and consulting
costs.

Our net  operating  income  during the three month period ended May 31, 2009 was
$375,295 compared to a net operating loss of ($2,992,591) during the three month
period ended May 31, 2008.

During the three month period ended May 31,  2009,  we recorded  other income in
the amount of $-0- (2008: $33,239) in gain on settlement of debt and $270 (2008:
$-0-) in interest  income.  This  resulted in net income of  ($375,565)  for the
three month period ended May 31, 2009 compared to a net loss of ($2,959,352) for
the three month period ended May 31, 2008.

Our net loss of  ($2,959,352)  for the three month period ended May 31, 2008 was
offset for foreign currency  translation  adjustment of $422 (2009:  $-0-). This
resulted in  comprehensive  income of $375,565  for the three month period ended


                                       23


<PAGE>


May 31, 2009 as compared to a comprehensive  loss of ($2,958,930)  for the three
month  period  ended  May 31,  2008.  The  weighted  average  number  of  shares
outstanding  was  39,690,409  for the three  month  period  ended  May 31,  2009
compared to 35,518,434 for the three month period ended May 31, 2008.

LIQUIDITY AND CAPITAL RESOURCES

THREE MONTH PERIOD ENDED MAY 31, 2009

As at the three  month  period  ended May 31,  2009,  our  current  assets  were
$2,419,248  and our current  liabilities  were  $1,361,678,  which resulted in a
working  capital  surplus of $1,057,570.  As at the three month period ended May
31, 2009,  current assets were comprised of: (i) $715,628 in cash; (ii) $403,620
in accounts receivable; and (iii) $1,300,000 in deposit on properties. As at the
three month period ended May 31, 2009,  current  liabilities  were  comprised of
$1,361,678 in accounts payable and accrued liabilities.

As at the  three  month  period  ended  May 31,  2009,  our  total  assets  were
$4,574,220  comprised of: (i) current assets in the amount of  $2,419,248;  (ii)
valuation  of proved oil and gas  properties,  net of  accumulated  depletion of
$750,093;  and (iii) valuation of unproved oil and gas properties of $1,404,879.
The  increase in total  assets  during the three month period ended May 31, 2009
from fiscal year ended  February 29, 2009 was  primarily  due to the increase in
cash and the valuation of the unproved oil and gas properties of $1,404,879.

As at the three month  period  ended May 31, 2009,  our total  liabilities  were
$1,361,678   comprised  entirely  of  current   liabilities.   The  increase  in
liabilities  during the three month  period  ended May 31, 2009 from fiscal year
ended  February 29, 2008 was primarily  due to the increase in accounts  payable
and accrued liabilities.

Stockholders'  equity  increased from  $2,328,102 for fiscal year ended February
29, 2009 to $3,212,542 for the three month period ended May 31, 2009.

CASH FLOWS FROM OPERATING ACTIVITIES

We have  generated  positive  cash flows from  operating  activities  during the
quarter.  For the three month  period  ended May 31,  2009,  net cash flows from
operating  activities  was  $380,091  consisting  primarily  of  net  income  of
$375,565.  Net cash flows from  operating  activities was adjusted by $24,918 in
depletion and $8,875 in non-cash  consulting fees. Net cash flows from operating
activities  was  further  changed  by $1,308 in  accounts  payable  and  accrued
liabilities and ($30,575) in accounts receivable.

For the three month period ended May 31, 2008,  net cash flows used in operating
activities was ($382,161)  consisting  primarily of a net loss of  ($2,959,352).
Net cash flows used in operating  activities was adjusted by $2,457,000 in stock
based  compensation and ($33,239) in non-cash mineral property  recoveries.  Net
cash flows used in  operating  activities  was  further  changed by  $159,568 in
accounts  payable and accrued  liabilities  and  ($6,138) in accounts  payable -
related parties.


                                       24


<PAGE>


CASH FLOWS FROM INVESTING ACTIVITIES

For the three month period ended May 31, 2009,  net cash flows used in investing
activities  was  ($314,739)  consisting of investment in oil and gas property of
($114,739)  and deposit on properties  of ($200,000)  compared to net cash flows
used in investing activities during the three month period ended May 31, 2008 of
($702,923) consisting of investment in oil and gas property.

CASH FLOWS FROM FINANCING ACTIVITIES

We have  financed  our  operations  primarily  from either  advancements  or the
issuance of equity and debt  instruments.  For the three month  period ended May
31,  2009,  net cash flows  provided  from  financing  activities  was  $500,000
compared to $3,675,000 for the three month period ended May 31, 2008. Cash flows
from  financing  activities  for the  three  month  period  ended  May 31,  2009
consisted of $500,000 in proceeds from the exercise of warrants. Cash flows from
financing  activities for the three month period ended May 31, 2008 consisted of
$3,675,000 in proceeds on sale of common stock.

We expect that working capital requirements will continue to be funded through a
combination  of our  existing  funds and further  issuances of  securities.  Our
working capital requirements are expected to increase in line with the growth of
our business.

PLAN OF OPERATION AND FUNDING

Existing working capital, further advances and debt instruments, and anticipated
cash flow are expected to be adequate to fund our  operations  over the next six
months.  We have no  lines  of  credit  or other  bank  financing  arrangements.
Generally,  we have  financed  operations  to date  through the  proceeds of the
private  placement  of  equity  and debt  instruments.  In  connection  with our
business plan, management anticipates additional increases in operating expenses
and capital expenditures relating to: (i) oil and gas operating properties; (ii)
possible drilling  initiatives on current properties and future properties;  and
(iii) future  property  acquisitions.  We intend to finance these  expenses with
further issuances of securities,  and debt issuances.  Thereafter,  we expect we
will need to raise  additional  capital and generate  revenues to meet long-term
operating  requirements.  Additional  issuances  of equity or  convertible  debt
securities will result in dilution to our current  shareholders.  Further,  such
securities  might have rights,  preferences  or privileges  senior to our common
stock.  Additional  financing may not be available upon acceptable  terms, or at
all. If adequate  funds are not  available or are not  available  on  acceptable
terms,  we may not be  able  to  take  advantage  of  prospective  new  business
endeavors or opportunities,  which could  significantly and materially  restrict
our business operations.

During  fiscal year ended  February  28,  2009,  we engaged in the 2008  Private
Placement  Offering pursuant to which we raised $4,000,000 under Regulation S of
the Securities Act.

MATERIAL COMMITMENTS

As of the date of this Quarterly  Report,  and other than our obligations  under
the Option Agreement as incurred, we do not have any material commitments.


                                       25


<PAGE>


PURCHASE OF SIGNIFICANT EQUIPMENT

We do not intend to purchase any  significant  equipment  during the next twelve
months.

OFF-BALANCE SHEET ARRANGEMENTS

As of the date of this Quarterly  Report,  we do not have any off-balance  sheet
arrangements  that have or are  reasonably  likely  to have a current  or future
effect on our financial condition,  changes in financial condition,  revenues or
expenses,  results of operations,  liquidity,  capital  expenditures  or capital
resources that are material to investors.

GOING CONCERN

The independent auditors' report accompanying our February 28, 2009 and February
29, 2008  financial  statements  contains an  explanatory  paragraph  expressing
substantial  doubt  about  our  ability  to  continue  as a going  concern.  The
financial  statements  have been prepared  "assuming  that we will continue as a
going concern," which  contemplates  that we will realize our assets and satisfy
our liabilities and commitments in the ordinary course of business.

ITEM III. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Market risk represents the risk of loss that may impact our financial  position,
results of  operations or cash flows due to adverse  change in foreign  currency
and interest rates.

EXCHANGE RATE

Our reporting currency is United States Dollars ("USD"). In the event we acquire
any properties  outside of the United States,  the fluctuation of exchange rates
may have  positive or negative  impacts on our results of  operations.  However,
since all of our properties are currently located within the United States,  any
potential revenue and expenses will be denominated in U.S. Dollars,  and the net
income effect of appreciation  and devaluation of the currency  against the U.S.
Dollar would be limited to our costs of the acquisition of property.


                                       26


<PAGE>


INTEREST RATE

Interest  rates in the United  States are  generally  controlled.  Any potential
future loans will relate mainly to  acquisition of properties and will be mainly
short-term.  However our debt may be likely to rise in connection with expansion
and if  interest  rates  were  to rise  at the  same  time,  this  could  have a
significant  impact  on our  operating  and  financing  activities.  We have not
entered  into  derivative  contracts  to hedge  existing  risks for  speculative
purposes.

ITEM IV. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

We have performed an evaluation under the supervision and with the participation
of our  management,  including our Chief  Executive  Officer and Chief Financial
Officer,  of the  effectiveness of our disclosure  controls and procedures,  (as
defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act).  Based on that
evaluation,  our  management,  including our Chief  Executive  Officer and Chief
Financial  Officer,  concluded that our disclosure  controls and procedures were
effective as of May 31, 2009 to provide  reasonable  assurance that  information
required to be disclosed by us in the reports filed or submitted by us under the
Exchange Act is recorded,  processed,  summarized  and reported  within the time
periods specified in the SEC's rules and forms.

MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal
control  over  financial  reporting  (as  defined  in Rule  13a-15(f)  under the
Exchange  Act).  Under  the  supervision  and  with  the  participation  of  our
management,  including the chief executive officer and chief financial  officer,
we evaluated the effectiveness of our internal control over financial  reporting
as of May 31, 2009. In making this assessment,  management used the criteria set
forth by the Committee of Sponsoring  Organizations  of the Treadway  Commission
("COSO") in Internal Control-Integrated Framework.

This Quarterly  Report does not include an attestation  report of our registered
public  accounting  firm De Joya  Griffith &  Company,  LLC.,  Certified  Public
Accountants  regarding internal control over financial  reporting.  Management's
report was not subject to attestation by our registered  public  accounting firm
pursuant  to  temporary  rules  of  the  SEC  that  permit  us to  provide  only
management's report in this Quarterly Report on Form 10-Q.

INHERENT LIMITATIONS ON EFFECTIVENESS OF CONTROLS

We believe that a control  system,  no matter how well  designed  and  operated,
cannot provide absolute assurance that the objectives of the controls system are
met, and no  evaluation  of controls  can provide  absolute  assurance  that all
control  issues  and  instances  of fraud,  if any,  within a company  have been
detected.  Our  disclosure  controls  and  procedures  are  designed  to provide
reasonable  assurance of achieving  their  objectives,  and our Chief  Executive
Officer and our Chief  Financial  Officer have concluded that these controls and
procedures are effective at the "reasonable assurance" level.


                                       27


<PAGE>


CHANGES IN INTERNAL CONTROLS

No significant  changes were implemented in our internal controls over financial
reporting  during  the  period  covered  by this  report  that  have  materially
affected,  or are reasonably likely to materially  affect,  our internal control
over financial reporting.

AUDIT COMMITTEE REPORT

The Board of Directors has  established an audit  committee.  The members of the
audit committee are Mr. Robert Fedun,  Mr. Ernest Sorochan and Mr. Angelo Viard.
All of the members of the audit committee are  "independent"  within the meaning
of Rule 10A-3 under the Exchange Act. The current audit  committee was organized
on February 4, 2009 and operates under a written charter adopted by our Board of
Directors.

The audit  committee has received and reviewed the written  disclosures  and the
letter  from De Joya  Griffith & Company,  LLC.,  Certified  Public  Accountants
required  by  Independence   Standards   Board  Standard  No.  1,   Independence
Discussions with Audit Committees, as amended.

Based on the reviews and discussions  referred to above, the audit committee has
recommended to the Board of Directors that the financial  statements referred to
above be  included  in our  Quarterly  Report on Form  10-Q for the three  month
period ended May 31, 2009 filed with the Securities and Exchange Commission.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Management  is  not  aware  of  any  legal   proceedings   contemplated  by  any
governmental authority or any other party involving us or our properties.  As of
the date of this Quarterly  Report,  no director,  officer or affiliate is (i) a
party adverse to us in any legal proceeding,  or (ii) has an adverse interest to
us in any  legal  proceedings.  Management  is not  aware  of  any  other  legal
proceedings pending or that have been threatened against us or our properties.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

CONSULTING AGREEMENT
Effective on March 17, 2009,  we issued  2,500 shares of our  restricted  common
stock at a per share price of $3.55 in accordance  with the terms and provisions
of a consulting  services  agreement.  The shares of common stock were issued in
reliance on Regulation S  promulgated  under the  Securities  Act. The per share
price of the Units were valued at the fair market value of the  Company's  stock
at the date of issuance.


                                       28


<PAGE>


ITEM 3. DEFAULTS UPON SENIOR SECURITIES

No report required.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No report required.

ITEM 5. OTHER INFORMATION

CONSULTING AGREEMENT

Effective on June 15, 2009,  we issued  2,500  shares of our  restricted  common
stock at a per share price of $2.90 in accordance  with the terms and provisions
of a consulting  services  agreement.  The shares of common stock were issued in
reliance on Regulation S  promulgated  under the  Securities  Act. The per share
price of the Units were valued at the fair market value of the  Company's  stock
at the date of issuance.

JULY 2008 PRIVATE PLACEMENT OFFERING

Effective May 2008, we completed a private placement offering (the "2008 Private
Placement")  with  certain  non-United  States  residents   (collectively,   the
"Investors").  In accordance  with the terms and  provisions of the 2008 Private
Placement,  we issued to the Investors an aggregate of 6,000,000  units at a per
unit price of $0.67 (the  "Unit")  in our  capital  for  aggregate  proceeds  of
$4,000,000.  Of the amount of $4,000,000 received,  $50,000 was as settlement of
debt and the remaining  $3,950,000 was received in cash. Each Unit was comprised
of one share of restricted  common stock and one-half  non-transferable  warrant
(the "Warrant").  Each Warrant is exercisable at $1.33 per share for a period of
one  year  from  the date of  issuance  ending  on May 1,  2009  (the  "Exercise
Period").

On  April  29,  2009,  our  Board  of  Directors  pursuant  to  written  consent
resolutions  approved a thirty-day  extension to the Exercise  Period to June 1,
2009  based on  current  market  conditions.  As of the  date of this  Quarterly
Report,  an aggregate of 864,750 Warrants were exercised at $1.33 per share with
net proceeds of $1,153,000.  Therefore, we issued an aggregate of 432,375 shares
of our  restricted  common  stock.  The  remaining  2,135,250  Warrants  expired
unexercised.


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<PAGE>


ITEM 6. EXHIBITS

        Exhibits:

        31.1     Certification of the registrant's  Principal Executive Officer
                 under the  Exchange  Act Rules,  12a-14(a)  or  15d-14(a),  as
                 adopted  pursuant  to Section  302 of the  Sarbanes-Oxley  Act
                 2002.

        31.2     Certification of the registrant's  Principal Financial Officer
                 under the  Exchange  Act Rules,  12a-14(a)  or  15d-14(a),  as
                 adopted  pursuant  to Section  302 of the  Sarbanes-Oxley  Act
                 2002.

        32.1     Certifications of the registrant's Principal Executive Officer
                 and Principal Financial Officer under 18 U.S.C.  Section 1350,
                 as adopted pursuant to Section 906 of the  Sarbanes-Oxley  Act
                 of 2002.


SIGNATURES

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


                                 MAINLAND RESOURCES, INC.


Dated: July 7, 2009              By: /s/ MICHAEL J. NEWPORT
                                         _______________________
                                         Michael J. Newport,
                                         President and
                                         Chief Executive Officer


Dated: July 7, 2009              By: /s/ WILLIAM D. THOMAS
                                         _______________________
                                         William D. Thomas
                                         Chief Financial Officer


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