| ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | **UNITED STATES**

**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 quarterly  period ended June 30, 2009

** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | ** **                                                                                                   | OR

** **                                                                            | ** ** | ** ** |
| o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF  THE SECURITIES EXCHANGE 

ACT OF 1934  For the transition period from __________ to  ___________ 

** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | ** **                                                                                                   | **Commission File Number 333-141993**

** **                                         | ** ** | ** ** |
| ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | ** **                                                                                                   | **PETROCORP INC.**

(Name of small  business issuer in its charter)                       | ** ** | ** ** |
| **Delaware**

** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | ** **                                                                                                   | **20-5134664**

** **                                                                |
| (State or other jurisdiction of 

incorporation or organization)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | (I.R.S. Employer  Identification No.)                                                                        |
| ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | **1065 Dobbs Ferry Road**

**White Plains, New York  10607**

(Address of principal  executive offices) | ** **                                                                                |
| ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | ** **                                                                                                   |  

**(914) 674-4373**

(Issuer's telephone  number, including area code)

** ** | ** ** | ** ** |
|  

Indicate by check mark whether  the issuer (1) 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 o

 

Indicate by check mark whether the registrant is a large  accelerated filer, an accelerated filer, a non-accelerated filer or a smaller  reporting company filer.  See the definitions of “large accelerated filer,” “accelerated  filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

          Large accelerated filer o	  Accelerated filer o	  Non-accelerated Filer o	   Smaller reporting company x

 

Indicate by check mark whether  the registrant is a shell company (as defined in Rule 12b-2 of the Exchange  Act).  Yes o   No x

** ** |
| State the number of shares outstanding of each of the  issuer’s classes of common equity, as of the latest practicable date: 22,680,000  shares of common stock, par value $.0001 per share, as of July 31, 2009.

 

 

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                              |                                                                                           |  |  |  |  |  |

 

1

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**PETROCORP INC.**

**REPORT ON FORM 10-Q**

**FOR THE QUARTERLY PERIODENDED JUNE 30, 2009**

 

 
| CONTENTS                                                                                               |
|--------------------------------------------------------------------------------------------------------|
|                                                                                                   |   |   |
| PART I – FINANCIAL INFORMATION                                                                    |   | 3 |
|      Item 1 – Financial Statements                                            |   | 3 |
|      Item 2 – Management’s Discussion and Analysis or Plan  of Operation |   | 8 |
|      Item 3 – Controls and Procedures                                         |   | 12 |
| PART II – OTHER INFORMATION                                                                       |   | 12 |
|      Item 1 – Legal Proceedings                                               |   | 12 |
|      Item 2 – Unregistered Sales of Equity Securities and  Use of Proceeds    |   | 12 |
|      Item 3 – Defaults Upon Senior Securities                                 |   | 13 |
|      Item 4 – Submission of Matters to a Vote of Security  Holders            |   | 13 |
|      Item 5 – Other Information                                               |   | 13 |
|      Item 6 – Exhibits                                                        |   | 13 |

 

 

 

 

 

 

 

 

2

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**PART I – FINANCIAL INFORMATION**

## Item 1 – FinancialStatements

** **

**PETROCORP INC.**

**(An Exploration Stage Company)**

**Consolidated Balance Sheets**

 

     

| **ASSETS**                                                              |
|-------------------------------------------------------------------------|
|                                                                    |   |   |   |   |   |   |
|                                                                    |   |   June 30, |   |   December 31, |
|                                                                    |   | 2009 |   | 2008 |
|                                                                    |   |     (Unaudited) |   |   |
| Current  assets:                                                        |   |   |   |   |   |   |
|      Cash                                                |   | $ | 207,964 |   | $ | 556,035 |
|      Revenue receivables                                 |   |   | 11,137 |   |   | 33,962 |
|                                                                    |   |   | 219,101 |   |   | 589,997 |
|                                                                    |   |   |   |   |   |   |
| Oil  and gas properties (successful efforts method):                    |   |   |   |   |   |   |
|      Developed                                           |   |   | 432,763 |   |   | 304,053 |
|      Undeveloped                                         |   |   | 1,584,992 |   |   | 1,189,840 |
|                                                                    |   |   | 2,017,755 |   |       | 1,493,893 |
|                                                                    |   |   |   |   |   |   |
| Other assets:                                                           |   |   |   |   |   |   |
|     Marketable securities -  restricted                  |   |   | 250,000 |   |   | -- |
|                                                                    |   |   |   |   |   |   |
| Total  assets                                                           |   | $ | 2,486,856 |   | $ | 2,083,890 |
| ** **                                                              |   |   |   |   |   |   |
| ** **                                                              |   |   |   |   |   |   |
| **LIABILITIES AND STOCKHOLDERS’ EQUITY**                           |
| ** **                                                              |   |   |   |   |   |   |
| ** **                                                              |   |   |   |   |   |   |
| Current liabilities:                                                    |   |   |   |   |   |   |
|      Accrued expenses                                    |   | $ | 120,842 |   | $ | 71,317 |
|      Notes payable to majority stockholder               |   |   | 1,317,881 |   |   | 734,058 |
|                                                                    |   |   | 1,438,723 |   |   | 805,375 |
|                                                                    |   |   |   |   |   |   |
| Stockholders’  equity:                                             |   |   |   |   |   |   |
|      Preferred stock; $.0001 par value; 1,000,000 shares |   |   |   |   |   |   |
|        authorized; none issued or outstanding  |   |   | -- |   |   | -- |
|      Common stock; $.0001 par value; 100,000,000 shares  |   |   |   |   |   |   |
|        authorized; 22,680,000 shares issued    |   |   |   |   |   |   |
|        and outstanding                         |   |   | 2,268 |   |   | 2,268 |
|      Additional paid-in capital                          |   |   | 1,802,052 |   |   | 1,711,182 |
|      Deficit accumulated during exploration stage        |   |   | (756,187) |   |   | (434,935) |
|                                                                    |   |   | 1,048,133 |   |   | 1,278,515 |
| ** **                                                              |   |   |   |   |   |   |
| Total  liabilities and stockholders’ equity                        |   | $ | 2,486,856 |   | $ | 2,083,890 |

** **

** **

See notes to the consolidated financial statements.

 

3

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******PETROCORP INC.**

**(An Exploration Stage Company)**

## Consolidated Statements ofOperations

## (Unaudited)

 

|                                                    |         |               |       |             |         |           |   |   |       |   |   |      |   |  June 19, 2006 |
|---------------------------------------------------------|--------------|--------------------|------------|------------------|--------------|----------------|--------|--------|------------|--------|--------|-----------|--------|---------------------|
|                                                    |         | Three Months Ended |       | Six Months Ended |         | (Inception) to |
|                                                    |         | June 30,           |       | June 30,         |         | June 30,       |
|                                                    |         | 2009               |       | 2008             |         |           | 2009   |   |       | 2008   |   | 2009      |
| Revenues:                                               |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
|     Oil and gas                          |         | $                  | 4,988      |             |  $      |           |   | $      | 9,273      |   | $      |      |   |  $             | 33,424 |
|                                                    |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
| Expenses:                                               |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
|     Oil and gas                          |         |               | 40,143     |             |         |           |   |   | 57,357     |   |   |      |   |           | 76,195 |
|     Depletion, depreciation and          |         |               |       |             |         |           |   |   |       |   |   |      |   |           |   |
|         amortization |         |               | 3,750      |             |         |           |   |   | 7,500      |   |   |      |   |                | 12,321 |
|     Exploration                          |         |               | 37,245     |             |         |           |   |   | 95,984     |   |   |      |   |           | 101,693 |
|     Impairment of equipment              |         |          |       |             |    |           |   |   |       |   |   |      |   |           | 16,929 |
|     Salaries                             |         |          | 30,000     |             |    | 30,000         |   |   | 60,000     |   |   | 60,000    |   |           | 190,000 |
|     Professional fees                    |         |          | 36,706     |             |    | 29,700         |   |   | 63,163     |   |   | 55,900    |   |                | 240,131 |
|     General and administrative           |         |               | 8,319      |             |         | 8,492          |   |   | 16,152     |   |   | 12,528    |   |           | 77,996 |
|     Franchise taxes                      |         |          |       |             |    |           |   |   | 164        |   |   | 5,750     |   |           | 9,150 |
|                                                    |         |               | 156,163    |             |         | 68,192         |   |   | 300,320    |   |   | 134,178   |   |                | 724,415 |
| Loss from operations                                    |         |               | (151,175)  |             |    | (68,192)       |   |   | (291,047)  |   |   | (134,178) |   |           | (690,991) |
|                                                    |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
| Other income (expense):                                 |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
|     Interest income                      |         |          | 197        |             |    |           |   |   | 665        |   |   |      |   |           | 2,383 |
|     Interest expense                     |         |          | (19,769)   |             |    | (6,672)        |   |   | (30,870)   |   |   | (13,236)  |   |           | (67,579) |
|                                                    |         |               | (19,572)   |             |         | (6,672)        |   |   | (30,205)   |   |   | (13,236)  |   |                | (65,196) |
| Loss before income taxes                                |         |               | (170,747)  |             |    | (74,864)       |   |   | (321,252)  |   |   | (147,414) |   |           | (756,187) |
|                                                    |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
| Provision for income taxes                              |         |               |       |             |    |           |   |   |       |   |   |      |   |           | -- |
| Net loss                                                |         | $                  | (170,747)  |             | $            | (74,864)       |   | $      | (321,252)  |   | $      | (147,414) |   | $                   | (756,187) |
|                                                    |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
| Net loss per common share -                             |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
|     basic and diluted                    |         | $                  | (0.01)     |             | $            | (0.01)         |   | $      | (0.01)     |   | $      | (0.03)    |   |                |   |
|                                                    |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
| Weighted average number of                              |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
|     common shares outstanding -          |         |               |       |             |         |           |   |   |       |   |   |      |   |                |   |
|      basic and diluted              |    |               | 22,680,000 |             |         | 5,670,000      |   |   | 22,680,000 |   |   | 5,584,286 |   |                |   |

 

 

 

See notes to the consolidated financial statements.

 

4

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**PETROCORP INC.**

**(An Exploration Stage Company)**

## Consolidated Statements of CashFlows

## (Unaudited)

|                                                                                            |   |                                 |      |           |         |      |   |  June19, 2006 |
|-------------------------------------------------------------------------------------------------|--------|--------------------------------------|-----------|----------------|--------------|-----------|--------|--------------------|
|                                                                                            |   | Six Months Ended                     |      | (Inception) to |
|                                                                                            |   | June 30,                             |      | June 30,       |
|                                                                                            |   | 2009                                 |      | 2008           |         | 2009      |
|                                                                                            |   |                                 |      |           |         |      |   |               |   |
| Cash flows from operating  activities:                                                          |   |                                 |      |           |         |      |   |               |   |
|    Net loss                                                                           |   | $                                    | (321,252) |           | $            | (147,414) |   | $                  | (756,187) |
|    Adjustments to reconcile net  loss to net cash                                     |   |                                 |      |           |         |      |   |               |   |
|      (used in) provided by  operating activities:                           |   |                                 |      |           |         |      |   |               |   |
|      Capital contribution                                                   |   |                                 |      |           |         |      |   |               | 3,000 |
|      Depletion, depreciation  and amortization                              |   |                                 | 7,500     |           |         |      |   |               | 12,321 |
|      Exploration expenses                                                   |   |                                 | 58,845    |           |         |      |   |               | 58,845 |
|      Impairment of equipment                                                |   |                                 |      |           |         |      |   |               | 16,929 |
|      Salary contribution                                                    |   |                                 | 60,000    |           |         | 60,000    |   |               | 180,000 |
|      Interest contribution                                                  |   |                                 | 30,870    |           |         | 12,877    |   |               | 67,220 |
|      Changes in operating  assets and liabilities:                          |   |                                 |      |           |         |      |   |               |   |
|         Revenue receivables                                  |   |                                 | 22,825    |           |         |      |   |               | (11,137) |
|         Accrued expenses                                     |   |                                 | 49,525    |           |         | 25,033    |   |          | 120,842 |
|         State of Alaska Payable                              |   |                                 |      |           |         | 58,445    |   |               | -- |
|         Net cash (used in)  provided by operating activities |   |                                 | (91,687)  |           |         | 8,941     |   |               | (308,167) |
|                                                                                            |   |                                 |      |           |         |      |   |               |   |
| Cash flows from investing  activities:                                                          |   |                                 |      |           |         |      |   |               |   |
|    Acquisition of oil and gas  properties                                             |   |        | (840,207) |           |         | (577,960) |   |               | (2,337,850) |
|    Purchase of equipment                                                              |   |                                 |      |           |    |      |   |          | (18,000) |
|        Net cash used in  investing activities                     |   |                                 | (840,207) |           |         | (577,960) |   |               | (2,335,850) |
|                                                                                            |   |                                 |      |           |         |      |   |               |   |
| Cash flows from financing  activities:                                                          |   |                                 |      |           |         |      |   |               |   |
|    Notes payable to majority  stockholder                                             |   |                                 | 610,375   |           |         |      |   |               | 1,434,433 |
|    Repayment of notes to  majority stockholder                                        |   |                                 | (26,552)  |           |         | (90,000)  |   |               | (116,552) |
|    Proceeds from sale of common  stock                                                |   |                                 |      |           |    | 1,000,000 |   |               | 1,554,100 |
|        Net cash provided by  financing activities                 |   |                                 | 583,823   |           |         | 910,000   |   |               | 2,871,981 |
|                                                                                            |   |                                 |      |           |         |      |   |               |   |
| Net (decrease) increase in cash                                                                 |   |                                 | (348,071) |           |         | 340,981   |   |               | 207,964 |
| Cash at beginning of period                                                                     |   |                                 | 556,035   |           |         | 827,755   |   |          | -- |
| Cash at end of period                                                                           |   | $                                    | 207,964   |           | $            | 1,168,736 |   | $                  | 207,964 |
|                                                                                            |   |                                 |      |           |         |      |   |               |   |
| Supplemental disclosure of cash  flow information:                                              |   |                                 |      |           |         |      |   |               |   |
|    Cash paid for interest                                                             |   |                                 |      |           |         |      |   | $                  | 359 |
|    Cash paid for taxes                                                                |   |                                 |      |           |         |      |   | $                  | -- |
| Supplemental disclosure of  noncash investing and                                               |   |                                 |      |           |         |      |   |               |   |
|    financing activities:                                                              |   |                                 |      |           |         |      |   |               |   |
|    Capital contribution                                                               |   |                                 |      |           |         |      |   | $                  | 3,000 |
|    Salary contribution                                                                |   | $                                    | 60,000    |           | $            | 60,000    |   | $                  | 180,000 |
|    Interest contribution                                                              |   | $                                    | 30,870    |           | $            | 12,877    |   | $                  | 67,220 |

 

 

See notes to the consolidated financial statements.

 

5

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**PETROCORP INC.**

**(An Exploration Stage Company)**

**Notes to the ConsolidatedFinancial Statements**

**(Unaudited)**

** **

** **

**1.  Basis of Presentation**

 

The accompanying unaudited consolidatedfinancial statements have been prepared in accordance with the accountingprinciples generally accepted in the United States of America for interimfinancial information and with the instructions to Form 10-Q and Article 10 ofRegulation S-X.  Accordingly, they do not include all of the information andfootnotes required by accounting principles generally accepted in the United States of America for annual financial statements.  In the opinion of management,all adjustments, consisting of normal recurring accruals considered necessaryfor a fair presentation, have been included.  Operating results for the three andsix months ended June 30, 2009 are not necessarily indicative of the resultsthat may be expected for the year ending December 31, 2009.  These financial statements should be read in conjunctionwith the financial statements of the Company for the year ended December 31,2008 and notes thereto contained in the Report on Form 10-K of theCompany as filed with the United States Securities and Exchange Commission (the“SEC”) on April 9, 2009.

 

**2.  Exploration Stage Company**

 

The Company is an exploration stage companyas defined by SFAS No. 7 “*Accounting and Reporting by Development StageEnterprises”*.  The Company is devoting substantially all of its efforts onestablishing the business and its planned principal operations have not yetcommenced.  All losses since inception have been considered part of theCompany’s exploration stage activities.

** **

**3. Marketable Securities - Restricted**

** **

OnJune 12, 2009, the Company executed and held a closing under an Agreement and Planof Reorganization by and between Tamm Oil and Gas Corp ("TAMO") and theCompany wherein the Company exchanged the membership interest in its subsidiaryUnion Energy (Alberta) LLC, a Colorado limited liability company, for 1,000,000 restricted shares of TAMO’s common stock.  TAMO’sshares are traded on the OTCBB and the closing price on June 12, 2009 was $0.80per share.  The Company valued the marketable securities - restricted at$250,000, the cost basis for the eight contiguous sections (totaling 5,120acres) of oil sands leases in the Peace River Oil Sands Area of northernAlberta, Canada, which is more readily available.

** **

**4. Related Party Transactions**

** **

OnMarch 31, 2009, the Company purchased 171 oil and gas lease interests totaling3,827 gross (2,666 net) acres in Okfuskee and Okmulgee Counties, Oklahoma from CH4 Energy, Inc., a company controlled by Soladino Investments SA (“Soladino”)at a cost of $583,823.  The Company reimbursed Soladino for its historic costs(acreage) by issuing a secured, non-interest bearing note, payable on demandfor $583,823 and assumed responsibility for all further costs.  The leases areheld in the name of Frontier Land, Inc. as fiduciary trustee for the benefit ofthe Company’s subsidiary Petrocorp (Oklahoma) Inc.

 

 

 6

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**PETROCORP INC.**

**(An Exploration Stage Company)**

**Notes to theConsolidated Financial Statements**

**(Unaudited)**

** **

 

AtJune 30, 2009, the Company has $1,317,881 in unsecured, non-interest bearingnotes (two), payable on demand with its majority stockholder Soladino.  Duringthe three and six month period ended June 30, 2009 the Company recordedinterest expense of $19,769 and $11,101, respectively.  Interest is computed atan implied rate of 6% per annum and this amount was recorded as a capital contribution bythe Company.

** **

The Company was provided management services byits president, Mr. Fitzsimons during the interim period ended June 30, 2009 at no cost.  The Company recorded the $60,000 estimated value ofthese services as compensation expense and as a capital contribution.  

 

**5. Subsequent Events**

 

The Company has evaluated all events that occurred after the balance sheet datebut before the financial statements were available to be issued to determine ifthey must be reported.  Management of the Company has determined that thereare no reportable subsequent events to be disclosed.

 

 

 

 

 

 

7

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# Item 2 – Management’s Discussion and Analysis orPlan of Operation

 

References to “Company”, “we”or “us” refer to Petrocorp Inc., unless the context requires otherwise.

 

Forward Looking Statements

 

Thefollowing is provided to supplement, and should be read in conjunction with,our financial statements and the accompanying notes included in our Form 10-Kas of December 31, 2008.  This report contains forward-looking statements andinformation relating to us that is based on the beliefs of our management aswell as assumptions made by, and information currently available to, ourmanagement. When used in this report, the words “anticipate”, “believe”,“estimate”, “expect”, “intend”, “plan” and similar expressions, as they relateto us or our management, are intended to identify forward-looking statements.These statements reflect management’s current view of us concerning futureevents and are subject to certain risks, uncertainties and assumptions,including among many others: 

 

|   | ● | the  quality of our properties with regard to, among other things, the existence  of reserves in economic quantities; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------|
|   | ● | uncertainties  about the estimates of reserves;                                                                       |

 

|   | ● | our  ability to increase our production and oil and natural gas income through exploration  and development; |
|--------|---------|--------------------------------------------------------------------------------------------------------------|
|   | ● | the  number of well locations to be drilled and the time frame within which they  will be drilled;           |

 

|   | ● | the  timing and extent of changes in commodity prices for natural gas and crude  oil; |
|--------|---------|---------------------------------------------------------------------------------------|
|   | ● | domestic  demand for oil and natural gas;                                             |

 

|   | ● | drilling  and operating risks;                                                       |
|--------|---------|--------------------------------------------------------------------------------------|
|   | ● | the  availability of equipment, such as drilling rigs and transportation  pipelines; |

 

|   | ● | changes  in our drilling plans and related budgets;                                                                               |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------|
|   | ● | the  adequacy of our capital resources and liquidity including, but not limited  to, access to additional borrowing capacity; and |

 

|   | ● | risks  and uncertainties described in the Risk Factors section or elsewhere in our  Annual Report on Form 10-K. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------|

 

Shouldone or more of these risks or uncertainties materialize or should theunderlying assumptions prove incorrect, actual outcomes and results coulddiffer materially from those indicated in the forward-looking statements.

 

Anyforward-looking statement speaks only as of the date on which such statement ismade, and we undertake no obligation to update any forward-looking statement orstatements to reflect events or circumstances after the date on which suchstatement is made or to reflect the occurrence of unanticipated events. Newfactors emerge from time to time and it is not possible for management topredict all of such factors, nor can it assess the impact of each factor on thebusiness or the extent to which any factor, or combination of factors, maycause actual results to differ materially from those contained in any forward-lookingstatements.

 

 

BusinessOverview

 

Petrocorp Inc. was incorporated on June19, 2006 under the laws of the State of Delaware.  Prior to September 2007, theCompany’s business model provided telephonic conferencing services tobusinesses, organizations and individuals in North America.  Due to capitalconstraints and because its executives could no longer serve the Companywithout compensation, the Company decided to change its business directions.

 

8

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We are an exploration stage Company engaged in the acquisition,exploration and production, if warranted, development of prospective oil andgas properties.  We plan to conduct exploration work on each of our current andfuture properties in order to ascertain whether any of them possesscommercially exploitable quantities of oil and gas reserves.  The Company hassignificant lease holdings on the North Slope of Alaska, the Canadian Province of Quebec, permit applications pending in Italy and Netherlands, and oil and gas production in Oklahoma.

 

Our office is located at 1065 Dobbs Ferry Road, White Plains, NY 10607 and our telephone number is (914) 674-4373. Our web-site address is http://petrocorp.us.

** **

Planof Operation

*** ***

Our plan of operation is to conductexploration work on each of our current and future properties in order toascertain whether any of them possess commercially exploitable quantities ofoil and gas reserves. There is no assurance that a commercially viable oil andgas reserve exists on any of our current and future properties, and a greatdeal of further exploration will be required before a final evaluation as tothe economic feasibility for our future exploration is determined. To date, wedo not know if any economically viable oil and gas reserves exist on any of ourcurrent or future properties and there is no assurance that we will discoverany.

 

**            Alaska**

 

On October 25, 2007, Union Energy (Alaska) LLC ("UEA"), oursubsidiary, was the winning bidder for tracts 254, 258 and 259 in the NorthSlope Areawide 2007 Competitive Oil and Gas Lease Sale.  The leases, covering14,680 net acres, were issued on August 1, 2008, with a term of seven years andsubject to a 12.5% royalty interest infavor of the State of Alaska.  UEA paid a total of$380,021 to the State of Alaska in respect of the leases.  These tracts arecontiguous and the Company believes, based upon current available geologicaldata and maps from the public domain, to contain the Kavik gas field,discovered in 1969, which has been evaluated in detail by the U.S. Departmentof the Interior, U.S Geological Survey ("USGS").

 

On February 27, 2008, UEA was the winning bidder for tracts 922,923, 927, 988, 989, 990, 991, 992 and 925 in the State of Alaska North SlopeFoothills Areawide 2008 Competitive Oil and Gas Lease Sale. The leases, covering9,600 net acres, were issued on September 1, 2008, with a term of 10 years andsubject to a 12.5% royalty interest infavor of the State of Alaska.  UEA paid a total of $59,565to the State of Alaska in respect of the leases.  These tracts are contiguousand the Company believes, based upon current available geological data and mapsfrom the public domain, to contain the East Kurupa gas field, discovered byTexaco in 1976.  The USGS has been studying the potential for unconventionalover-pressured, continuous gas deposits in the Colville basin that contains theKurupa anticline and is now interpreting the East Kurupa well to haveencountered a thick section of over-pressured gas in Brookian strata.

 

The Alaska leases are in areas which the Company believes arepromising for gas production although the Company does not make anyrepresentations as to their future production, if any.  Furthermore, any gasrecovered from our Alaska leases will not be salable unless or until a proposed North Slope gas pipeline is completed.  We have retained Frontier Land Inc.(an established land firm and a member of the American Association ofProfessional Landmen) to conduct negotiations with other leaseholders regardingtheir acreage and to acquire other land interests within the vicinity of ourtracts.

 

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**            Oklahoma**

 

OnAugust 12, 2008, the Company acquired from its President, James Fitzsimons, a50% working interest (41.25% net revenue interest) in the Snake Creek prospect,a 3,200 gross (3,022 net) acre gas development project located in northernOkmulgee County.  The Company reimbursed Mr. Fitzsimons for his historic costs(acreage and drilling) by issuing a secured, non-interest bearing note, payableon demand for $210,917 and assumed responsibility for all further costs.

 

OnNovember 30, 2008, the Company acquired from Mr. Fitzsimons, a 100% workinginterest (81.25% net revenue interest) in the Spanish Peak prospect, a 2,041gross (900 net) acre gas development project located in Okmulgee County,Oklahoma.  The Company reimbursed Mr. Fitzsimons for his historic costs(acreage) by issuing a secured, non-interest bearing note, payable on demandfor $173,141 and assumed responsibility for all further costs.

 

OnMarch 31, 2009, the Company purchased 171 oil and gas lease interests totaling3,827 gross (2,666 net) acres in Okfuskee and Okmulgee Counties, Oklahoma from CH4 Energy, Inc., a company controlled by Soladino Investments SA at a costof $583,823.  The Company reimbursed Soladino for its historic costs (acreage)by issuing a secured, non-interest bearing note, payable on demand for $583,823and assumed responsibility for all further costs.

 

The Company’s Okfuskee and Okmulgee County oil and gas leases arenear oil and gas fields with proved developed production and within the generalarea of the “Woodford shale play”.  We have retained Keith Summar (a member ofthe American Association of Petroleum Geologists) as a consultant to assist usin our Oklahoma operations.

* *

**            Quebec, Canada**

** **

On February 4, 2009, the Government of Quebec awarded the Companyseven oil and gas exploration licenses – 2009P462 to 2009PG468 – all located inthe St. Lawrence Lowlands area.  The seven Quebec licenses cover a total netsurface area of 114,045 hectares (281,593 acres) and have an initial term offive years.  The Company has committed to a five-year work program with minimumexpenditures of (expressed in Canadian dollars): $0.50 per hectare in the firstyear; $1.00 per hectare in the second year; $1.50 per hectare in the thirdyear; $2.00 per hectare in the fourth year; and $2.50 per hectare in the fifthyear.

 

**            Italy**

 

OnJanuary 20, 2009, the Government of Italy made the preliminary awards of thecompetitive oil and gas exploration licenses, “Fiorenzuola D'Arda” located inthe Po Valley and “Montottone” located in the Marche region, in favor of MacOil SpA, our subsidiary.  On March 24, 2009, the Government of Italy made thepreliminary award of the competitive oil and gas exploration license, “Melzo”located in the Po Valley, again in favor of Mac Oil SpA. The three Italy licenses cover a net surface area of 115,760 hectares (285,827 acres).

 

The Company also has two competitive oil and gasexploration license applications pending awaiting adjudication by the Ministryof Economic Development in Italy covering a net surface area of 50,342 hectares(124,301 acres).

 

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            **Netherlands**

 

The Company has one license application pendingcovering a net surface area of 5,037 hectares (111,202 acres).

 

Internationally,we have retained Daniele Albisetti and Christian Ceppi (members of the SwissGeological Society, the Società Geologica Italiana (Italian Geological Society)and the Geological Association of Canada) as consultants to assist us in ouroperations.

 

Resultsof Operations

 

ThreeMonths Ended June 30, 2009 Compared to Three Months Ended June 30, 2008

 

For the quarter ended June 30,2009, we had revenues of $4,988, oil and gas exploration costs of $81,138 andincurred a loss of $170,747, as compared to no revenues and a loss of $74,864in 2008. During the 2009 quarter, theCompany paid compensation to its President of $30,000 which was recorded as acapital contribution by the Company and professional fees of $36,706, whichrelated primarily to the development of the Company’s business plan and costsassociated with being a public company, as compared to $29,700 for the 2008quarter.  Also during the 2009 quarter, the Company paid general andadministrative expenses of $8,319, which included rent, telephone and otheroffice costs, as compared to $8,492 for the 2008 quarter.  Interest expense of$19,769 was computed on the officer/stockholder loans at an implied rate of 6%and this amount was recorded as a capital contribution by the Company duringthe quarter.

 

SixMonths Ended June 30, 2009 Compared to Six Months Ended June 30, 2008

 

Duringthe six months ended June 30, 2009, we incurred a net loss of $321,252 comparedto a net loss of $147,414 for the 2008 period.  During the six months endedJune 30, 2009, the Company paid compensation and professional fees of $123,163,which related primarily to the development of the Company’s business plan andcosts associated with being a public company, as compared to $115,900 for the2008 period.  Also during the six months ended June 30, 2009, the Company paidgeneral and administrative expenses of $16,152, which included rent, telephoneand other office costs, as compared to $12,528 for the 2008 period.  During thesix months ended June 30, 2009 interest expense of $30,870 was computed on theofficer/stockholder loans at an implied rate of 6% and this amount was recordedas a capital contribution by the Company during the period.

 

Liquidityand Capital Resources

 

OurCompany's principal cash requirements are for exploration expenses which weanticipate will rise as we proceed to determine the feasibility of developingour current or future property interests.  As of June 30, 2009, we had cash of$207,964 and working capital of $98,259.  Our net cash provided by financingactivities during the period from our inception to June 30, 2009 was $2,871,981.

 

OnMarch 31, 2009, the Company purchased 171 oil and gas lease interests totaling3,827 gross (2,666 net) acres in Okfuskee and Okmulgee Counties, Oklahoma from CH4 Energy, Inc., a company controlled by Soladino Investments SA (“Soladino”)at a cost of $583,823.  The Company reimbursed Soladino for its historic costs(acreage) by issuing a secured, non-interest bearing note, payable on demandfor $583,823 and assumed responsibility for all further costs.

*** ***

AtJune 30, 2009, the Company has $1,317,881 in unsecured, non-interest bearingnotes (two), payable on demand with its majority stockholder Soladino.  The notes aresecured by the Company’s oil and gas leases.

 

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Weanticipate that additional funding will be provided in the form of equityfinancing from the sale of our common stock or loans from directors. We cannotprovide investors with any assurance that additional funds will be raised. Currently, we do not have any arrangements in place for future equityfinancings.

*** ***

Critical Accounting Policies

Financial Reporting Release No. 60 of the SEC encouragesall companies to include a discussion of critical accounting policies ormethods used in the preparation of the financial statements.  There are nocurrent revenue generating activities that give rise to significant assumptionsor estimates.  Our most critical accounting policies relate to the accountingand disclosure of related party transactions.  Our financial statements filed aspart of our December 31, 2008 Annual Report include a summary of thesignificant accounting policies and methods used in the preparation of ourfinancial statements.

 

Off-BalanceSheet Arrangements

 

Wehave never entered into any off-balance sheet financing arrangements and havenot formed any special purpose entities. We have not guaranteed any debt orcommitments of other entities or entered into any options on non-financialassets.

** **

**Item3.  Controls and Procedures**

 

Anevaluation was carried out under the supervision and with the participation ofour management, including our Chief Financial Officer and President, of theeffectiveness of our disclosure controls and procedures as of the end of theperiod covered by this report on Form 10-Q.  Disclosure controls and proceduresare procedures that are designed with the objective of ensuring thatinformation required to be disclosed in our reports filed under the SecuritiesExchange Act of 1934, such as this Form 10-Q, is recorded, processed,summarized and reported, within the time period specified in the Securities andExchange Commission’s rules and forms, and that such information is accumulatedand is communicated to our management, including our principal executive andprincipal financial officers, or persons performing similar functions, as appropriate,to allow timely decisions regarding required disclosure. Based on thatevaluation, our management concluded that, as of June 30, 2009, our disclosurecontrols and procedures are effective to satisfy the objectives for which theyare intended.

 

Therewere no changes in our internal control over financial reporting identified inconnection with the evaluation performed that occurred during the fiscalquarter covered by this report that has materially affected or is reasonablylikely to materially affect, our internal control over financial reporting.

 

# PART II –OTHER INFORMATION

 

## Item 1 – LegalProceedings

 

TheCompany is not currently a party to any legal proceedings.

 

## Item 2 – Unregistered Sales of Equity Securities andUse of Proceeds

 

None.

 

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## Item 3 – Defaults UponSenior Securities

 

None.

 

## Item 4 – Submission ofMatters to a Vote of Security Holders

 

None.

 

## Item 5 – OtherInformation

 

None.

 

## Item 6 – Exhibits

 

Thefollowing documents are filed as part of this Report.

 
| **Exhibit Number** | **Exhibit Description**                                                              |
|--------------------|--------------------------------------------------------------------------------------|
| 31.1               | Rule 13a-14(a)/15d-14(a)  Certification by the Principal Executive Officer.  ** |
| 31.2               | Rule 13a-14(a)/15d-14(a)  Certification by the Principal Financial Officer.  ** |
| 32.1               | Section 1350 Certification by the  Principal Executive Officer.  **             |
| 32.2               | Section 1350 Certification by the  Principal Financial Officer.  **             |

 

** Filed herewith

 

 

**SIGNATURE**

 

 

In accordance with the requirements of the SecuritiesExchange Act of 1934, as amended, the registrant caused this Report on Form10-Q to be signed on its behalf by the undersigned, thereunto duly authorized.

 

                                                                                   **    PETROCORP INC.**

 

Date:August 10, 2009

                                                                                        By:  /s/  James Fitzsimons

    James Fitzsimons, President

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