UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 FORM
10-Q
 x
              QUARTERLY REPORT UNDER SECTION
      13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934: FOR THE QUARTERLY
      PERIOD ENDEDMarch
      31, 2009
  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: 000-27739
 Royal
Quantum Group, Inc.
 (Exact
name of small business issuer as specified in its charter)
 
 Nevada
              77-0517966(State
      or other jurisdiction of incorporation or organization)
              (I.R.S.
      Employer Identification No.)
 
 Suite
      #145, 251 MidPark Blvd S.E. Calgary, AB Canada T2X
    1S3(Address
      of principal executive offices)
 
 (403)
      288-4321(Issuer’s
      Telephone Number)
  Indicate
by check mark 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. xYes  oNo
  Indicate
by check mark whether the registrant is a large accelerated file, an accelerated
filer, a non-accelerated filer, or a smaller reporting company. See the
definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
  Large
      accelerated
      filer                               
      o
              Accelerated
      filer                                    
      oNon-accelerated
      filer                                 
      o
                (Do
      not check if a smaller reporting company)
              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). o Yes  xNo
 
 APPLICABLE
ONLY TO CORPORATE ISSUERS
  State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practical date.  As of April 30, 2009 there were
48,020,338 shares of the issuer's $.001 par value common stock issued and
outstanding.
  
  PART
I - FINANCIAL INFORMATION
 
 Item 1.  Financial
Statements
 
 ROYAL
      QUANTUM GROUP, INC.(A
      Development Stage Company)CONSOLIDATED BALANCE
      SHEETS(Unaudited)
                
                
                (Audited)March
      31,
                
                
                December
      31,ASSETS
                
                2009
                
                
                2008Current
      Assets:Cash
      & Cash Equivalents
                
                $
                128,506
                
                
                $
                90,363Total
      Current Assets
                
                
                128,506
                
                
                
                90,363Fixed
      Assets:Furniture
      & Fixtures
                
                
                1,851
                
                
                
                1,851Less:
      Accumulated Depreciation
                
                
                (1,018
                )
                
                
                (925
                )Total
      Fixed Assets
                
                
                833
                
                
                
                926Other
      Assets:Intangible
      Assets
                
                
                1
                
                
                
                1Mineral
      Property & Deferred Expenditures
                
                
                0
                
                
                
                0Total
      Other Assets
                
                
                1
                
                
                
                1Total
      Assets
                
                $
                129,340
                
                
                $
                91,290LIABILITIES
      & STOCKHOLDERS' EQUITYCurrent
      Liabilities:Accounts
      Payable
                
                $
                81,324
                
                
                $
                86,082Notes
      Payable
                
                
                243,463
                
                
                
                235,755Deposits-Share
      subscriptions
                
                
                80,000
                
                
                
                0Related
      Party Payables
                
                
                117,020
                
                
                
                98,262Shareholder
      Loans
                
                
                19,845
                
                
                
                19,845Total
      Current Liabilities
                
                
                541,652
                
                
                
                439,944Total
      Liabilities
                
                
                541,652
                
                
                
                439,944Stockholders'
      Equity:Common
      Stock, Par value $.001Authorized
      500,000,000 sharesIssued
      48,020,338Shares
      at March 31, 2009 and Dec 31, 2008
                
                
                48,020
                
                
                
                48,020Paid-in
      Capital
                
                
                4,480,442
                
                
                
                4,480,442Deficit
      Accumulated During theDevelopment
      Stage
                
                
                (4,940,774
                )
                
                
                (4,877,116
                )Total
      Stockholders' Equity
                
                
                (412,312
                )
                
                
                (348,654
                )Total
      Liabilities and Stockholders' Equity
                
                $
                129,340
                
                
                $
                91,290The
      accompanying notes are an integral part of the financial
      statements
  1
  ROYAL QUANTUM GROUP, INC.(A Development Stage
    Company)STATEMENTS OF OPERATIONS(Unaudited)CumulativesinceAugust
      23,For
      the three months
                
                
                2002ended
                
                
                inception
      ofMarch
      31,
                
                
                development2009
                
                
                2008
                
                
                stageRevenues
                
                $
                -
                
                
                $
                -
                
                
                $
                --
                
                
                
                -
                
                
                
                -ExpensesConsulting
      Fees
                
                
                49,650
                
                
                
                120,000
                
                
                
                1,097,163Compensation
      Expense
                
                
                -
                
                
                
                -
                
                
                
                273,790Exploration
      Expense
                
                
                -
                
                
                
                -
                
                
                
                475,949General
      & Administrative
                
                
                6,299
                
                
                
                23,207
                
                
                
                484,275Loss
      from Operations
                
                
                (55,949
                )
                
                
                (143,207
                )
                
                
                (2,331,177
                )Other
      Income (Expenses)Write-down
      of Assets
                
                
                -
                
                
                
                -
                
                
                
                (157,986
                )Foreign
      currency exchange gain (loss)
                
                
                (565
                )
                
                
                10,237
                
                
                
                16,568Interest
      (Expense)
                
                
                (7,144
                )
                
                
                (7,853
                )
                
                
                (680,923
                )Interest
      Income
                
                
                -
                
                
                
                -
                
                
                
                263Forgiveness
      of debt
                
                
                -
                
                
                
                -
                
                
                
                46,520Total
      Other Income (Expense)
                
                
                (7,709
                )
                
                
                2,384
                
                
                
                (775,558
                )Net
      Loss from Continuing Operations
                
                $
                (63,658
                )
                
                $
                (140,823
                )
                
                $
                (3,106,735
                )Discontinued
      OperationsLoss
      from operation of discontinued component
                
                
                -
                
                
                
                -
                
                
                
                (1,967,294
                )Gain
      pn disposal net of tax effect of $0
                
                
                -
                
                
                
                -
                
                
                
                133,255Net
      Income (Loss) from Discontinued Operations
                
                
                -
                
                
                
                -
                
                
                
                (1,834,039
                )Net
      Loss
                
                $
                (63,658
                )
                
                $
                (140,823
                )
                
                $
                (4,940,774
                )Basic
      and Diluted Loss Per ShareContinuing
      Operations
                
                
                0.00
                
                
                
                0.00Loss
      per share
                
                
                0.00
                
                
                
                0.00Weighted
      Average Shares Outstanding
                
                
                48,020,338
                
                
                
                39,215,338The
      accompanying notes are an integral part of the financial
      statements
  2
  ROYAL QUANTUM GROUP, INC.(A Development Stage
    Company)STATEMENTS OF CASH FLOWS(Unaudited)CumulativesinceAugust
      23,2002For
      the three months
                
                
                inception
      ofMarch
      31, ended
                
                
                development2009
                
                
                2008
                
                
                stageCASH FLOWS FROM
      OPERATING ACTIVITIES:Net
      Loss
                
                $
                (63,658
                )
                
                $
                (140,823
                )
                
                $
                (4,940,774
                )Net
      Income/(Loss)from Discontinued Operations
                
                
                -
                
                
                
                -
                
                
                
                1,578,681Adjustments
      to reconcile net income (loss) tonet
      cash provided (used in) operating activities:Depreciation
                
                
                93
                
                
                
                93
                
                
                
                1,018Write-down
      of mineral property
                
                
                -
                
                
                
                -
                
                
                
                475,949Write-down
      of assets
                
                
                -
                
                
                
                -
                
                
                
                10,000Stock
      issued for interest
                
                
                -
                
                
                
                -
                
                
                
                600,000Stock
      issued for start up costs
                
                
                -
                
                
                
                -
                
                
                
                12,600Stock
      issued for services
                
                
                -
                
                
                
                -
                
                
                
                644,390Forgiveness
      of debt
                
                
                -
                
                
                
                -
                
                
                
                (46,520
                )Foreign
      currency exchange loss (gain)
                
                
                565
                
                
                
                (10,237
                )
                
                
                (16,568
                )Increase
      (decrease) in interest on notes payable
                
                
                7,144
                
                
                
                7,852
                
                
                
                74,237Increase
      (decrease) in accounts payable
                
                
                (4,758
                )
                
                
                4,865
                
                
                
                331,087Increase
      (decrease) in related party accounts payable
                
                
                18,758
                
                
                
                4,953
                
                
                
                79,378Net
      cash provided (used in) continuing activities
                
                
                (41,856
                )
                
                
                (133,297
                )
                
                
                (1,196,522
                )Net
      cash provided (used in) discontinuing activities
                
                
                -
                
                
                
                -
                
                
                
                386,515Net
      cash provided by (used in) operating activities
                
                
                (41,856
                )
                
                
                (133,297
                )
                
                
                (810,007
                )CASH FLOWS FROM
      INVESTING ACTIVITIES:Investment
      in Mineral Property
                
                
                -
                
                
                
                -
                
                
                
                (10,000
                )Investment
      in Oil Property
                
                
                (1
                )
                
                
                -
                
                
                
                (417,200
                )Purchase
      of fixed assets
                
                
                -
                
                
                
                -
                
                
                
                (1,851
                )Net
      cash provided by (used in) investing activities
                
                
                (1
                )
                
                
                0
                
                
                
                (429,051
                )CASH FLOWS FROM
      FINANCING ACTIVITIES:Proceeds
      from shareholder loans
                
                
                -
                
                
                
                -
                
                
                
                136,027Proceeds
      for share subscriptions
                
                
                80,000
                
                
                
                -
                
                
                
                80,000Payment
      on shareholder loans
                
                
                -
                
                
                
                (6,000
                )
                
                
                (88,182
                )Proceeds
      from notes payable
                
                
                -
                
                
                
                -
                
                
                
                685,795Contributed
      capital
                
                
                -
                
                
                
                -
                
                
                
                2,842Stock
      issued in exchange for cash
                
                
                -
                
                
                
                182,000
                
                
                
                551,082Net
      cash provided by (used in) financing activities
                
                
                80,000
                
                
                
                176,000
                
                
                
                1,367,564Net
      (Decrease) increase in Cash and Cash Equivalents
                
                
                38,143
                
                
                
                42,703
                
                
                
                128,506Cash
      and Cash Equivalents at Beginning of Period
                
                
                90,363
                
                
                
                3,448
                
                
                
                -Cash
      and Cash Equivalents at End of Period
                
                $
                128,506
                
                
                $
                46,151
                
                
                $
                128,506SUPPLEMENTAL
      DISCLOSURE OF CASH FLOW INFORMATION:Cash
      paid during the year for:Interest
                
                $
                -
                
                
                $
                -
                
                
                $
                12Income
      taxes
                
                $
                -
                
                
                $
                -
                
                
                $
                -SUPPLEMENTAL
      DISCLOSURE OF NON-CASH INVESTING AND FINANCING
      ACTIVITIESStock
      issued in plan of reorganization
                
                $
                -
                
                
                $
                -
                
                
                $
                858Stock
      issued in asset acquisition
                
                $
                -
                
                
                $
                -
                
                
                $
                2,243,000Stock
      issued for services
                
                $
                -
                
                
                $
                -
                
                
                $
                594,390Stock
      issued for investment in oil property
                
                $
                -
                
                
                $
                -
                
                
                $
                58,750Stock
      issued for cancellation of debt
                
                $
                -
                
                
                $
                -
                
                
                $
                674,700Shareholder
      loans converted to paid in capital
                
                $
                -
                
                
                $
                -
                
                
                $
                3,000Stock
      issued for Accounts Payable
                
                $
                -
                
                
                $
                -
                
                
                $
                52,500The
      accompanying notes are an integral part of the financial
      statements
  3
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 This
summary of accounting policies for Royal Quantum Group, Inc. (the “Company”) is
presented to assist in understanding the Company's financial
statements.  The accounting policies conform to generally accepted
accounting principles and have been consistently applied in the preparation of
the financial statements.
 
 Interim Financial
Statements
 
 The
unaudited financial statements as of March 31, 2009 and the three months then
ended, reflect, in the opinion of management, all adjustments (which include
only normal recurring adjustments) necessary to fairly state the financial
position and results of the operations for the three months then
ended.  Operating results for interim periods are not necessarily
indicative of the results which can be expected for full years.
 
 Nature of Operations and
Going Concern
 
 The
accompanying financial statements have been prepared on the basis of accounting
principles applicable to a “going concern”, which assume that the Company will
continue in operation for at least one year and will be able to realize its
assets and discharge its liabilities in the normal course of
operations.
 
 Several
conditions and events cast doubt about the Company’s ability to continue as a
“going concern”.  The Company has incurred net losses of approximately
$4,940,774 for the period from August 23, 2002 (inception of development stage)
to March 31, 2009 has a liquidity problem, and as of March 31, 2009 has no
sources of revenue.  In the interim, shareholders of the Company have
committed to meeting any shortfall of operational cash flow.   In
addition the company may require increasing equity and debt financing in order
to finance its business activities on an ongoing basis.
 
 These
financial statements do not reflect adjustments that would be necessary if the
Company were unable to continue as a “going concern”.  While
management believes that the actions already taken or planned, will mitigate the
adverse conditions and events which raise doubt about the validity of the “going
concern” assumption used in preparing these financial statements, there can be
no assurance that these actions will be successful.
 
 If the
Company were unable to continue as a “going concern”, then substantial
adjustments would be necessary to the carrying values of assets, the reported
amounts of its liabilities, the reported expenses, and the balance sheet
classifications used.
  4
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 Organization and Basis of
Presentation
 
 The
Company was incorporated under the laws of the State of Nevada on October 22,
1996 under the name PSM Corp.  The Company ceased all operating
activities during the period from October 22, 1996 to July 9, 1999 and was
considered dormant. On July 9, 1999, the Company obtained a Certificate of
renewal from the State of Nevada.
 
 On
October 3, 2002, the Company changed its name to Platinum SuperYachts, Inc. in
anticipation of a merger with SuperYachts Holdings, Inc. (a Nevada Corporation
that was incorporated on August 23, 2002).  On November 15, 2002, the
shareholders of the Platinum SuperYachts, Inc. completed a stock exchange
agreement with SuperYachts Holdings, Inc. dated August 8, 2002.  The
merger was accounted for as a reverse merger, with SuperYachts Holdings being
treated as the acquiring entity for financial reporting purposes.
 
 For
financial reporting purposes, Platinum SuperYachts, Inc. was considered a new
reporting entity on November 15, 2002
 
 On
November 23, 2005 holders of a majority of the Company’s common stock approved
an Amendment to change the name of the Company to Royal Quantum Group, Inc., to
increase the number of shares of common stock the Company is authorized to issue
to 500,000,000 and to authorize the Company to issue up to 10,000,000 shares of
preferred stock.
 
 As of
March 31, 2009, the Company is in the development stage.
 
 Nature of
Business
 
 Royal
Quantum Group Inc. is a public company trading on the OTCBB market under the
symbol RYQG.  Royal Quantum is focused on the acquisition, exploration
and development of resource and mineral properties located within favorable
geo-political climates.
  5
 ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Cash and Cash
Equivalents
 
 For
purposes of the statement of cash flows, the Company considers all highly liquid
debt instruments purchased with a maturity of three months or less to be cash
equivalents to the extent the funds are not being held for investment
purposes.
 
 Depreciation and
Amortization
 
 Fixed
assets are recorded at cost and depreciated using the straight-line method over
the estimated useful lives of the assets which range from three to five
years.  Fixed assets consisted of the following at March 31, 2009 and
December 31, 2008:
 
 March
      31,
                
                
                December
      31,2009
                
                
                2008Furniture
      & Fixtures
                
                $
                1,851
                
                
                $
                1,851Less
      accumulated depreciation
                
                
                (1,018
                )
                
                
                (925
                )Total
                
                $
                833
                
                
                $
                926
 
 Maintenance
and repairs are charged to operations; betterments are
capitalized.  The cost of property sold or otherwise disposed of and
the accumulated depreciation thereon are eliminated from the property and
related accumulated depreciation accounts, and any resulting gain or loss is
credited or charged to income.
 
 Total
depreciation expense for the three months ended March 31, 2009 and the year end
December 31 2008 was $93 and $370 respectively.
  6
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
   NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Intangible
Assets
 
 The
Company has adopted the Financial Accounting Standards Board SFAS No., 142,
“Goodwill and Other Intangible Assets.”  SFAS 142 requires, among
other things, that companies no longer amortize goodwill, but instead test
goodwill for impairment at least annually.  In addition, SFAS 142
requires that the Company identify reporting units for the purposes of assessing
potential future impairments of goodwill, reassess the useful lives of other
existing recognized intangible assets, and cease amortization of intangible
assets with an indefinite useful life.  An intangible asset with an
indefinite useful life should be tested for impairment in accordance with the
guidance in SFAS 142.
 
 Intangible
Assets consisted of the following at March 31, 2009 and December 31,
2008:
 
 March
      31
                
                
                December
      31,Intangible
      Asset
                
                2009
                
                
                2008
                
                Amortization
      PeriodE-Learning
      System
                
                $
                1
                
                
                $
                1
                
                IndefiniteLess
      accumulated amortization
                
                
                -
                
                
                
                -Total
                
                $
                1
                
                
                $
                1
 
 Total
amortization expense for the three months ended March 31, 2009 and December 31,
2008 was $0 and $0 respectively.
 
 Pervasiveness of
Estimates
 
 The
preparation of financial statements in conformity with generally accepted
accounting principles required 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 reporting
period.  Actual results could differ from those
estimates.
 
 Foreign Currency
Translation
 
 The
Company's primary functional currency is the U.S. dollar.  However,
the Company has a few transactions in Canada. Transaction gains and losses are
included in income.
  7
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Concentrations of Credit
Risk
 
 The
Company has no significant off-balance-sheet concentrations of credit risk such
as foreign exchange contracts, options contracts or other foreign hedging
arrangements. The Company had cash and cash equivalents in the amount of
$128,506 and $90,363 as of March 31, 2009 and December 31, 2008.
 
 Earnings (Loss) per
Share
 
 Basic
loss per share has been computed by dividing the loss for the period applicable
to the common stockholders by the weighted average number of common shares
outstanding during the years.  There were no common equivalent shares
outstanding at March 31, 2009 and 2008.
 
 Stock Compensation for
Non-Employees
 
 Effective
June 1, 2006, the company adopted the provisions of SFAS No. 123 (R) requiring
employee equity awards to be accounted for under the fair value method.
Accordingly, share-based compensation is measured at grant date, based on the
fair value of the award. Prior to June 1, 2006, the company accounted for awards
granted to employees under its equity incentive plans under the intrinsic value
method prescribed by Accounting Principles Board (APB) Opinion No. 25,
“Accounting for Stock Issued to Employees” (APB 25), and related
interpretations, and provided the required pro forma disclosures prescribed by
SFAS No. 123, “Accounting for Stock-Based Compensation” (SFAS No. 123), as
amended. No stock options were granted to employees during the years ended
December 31, 2006, and 2005 and accordingly, no compensation expense was
recognized under APB No. 25 for the years ended December 31, 2007, and 2006. In
addition, no compensation expense is required to be recognized under provisions
of SFAS No. 123 (R) with respect to employees.  Under the modified
prospective method of adoption for SFAS No. 123 (R), the compensation cost
recognized by the company beginning on June 1, 2006 includes (a) compensation
cost for all equity incentive awards granted prior to, but not vested as of June
1, 2006, based on the grant-dated fair value estimated in accordance with the
original provisions of SFAS No. 123, and (b) compensation cost for all equity
incentive awards granted subsequent to June 1, 2006, based on the grant-date
fair value estimated in accordance with the provisions of SFAS No, 123 (R). The
company uses the straight-line attribution method to recognize share-based
compensation costs over the service period of the award. Upon exercise,
cancellation, forfeiture, or expiration of stock options, or upon vesting or
forfeiture of restricted stock units, deferred tax assets for options and
restricted stock units with multiple vesting dates are eliminated for each
vesting
  8
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
   NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Stock Compensation for
Non-Employees (Continued)
 
 period on
a first-in, first-out basis as if each vesting period was a separate award. To
calculate the excess tax benefits available for use in offsetting future tax
shortfalls as of the dated of implementation, the company followed the
alternative transition method discussed in FASB Staff Position No. 123
(R)-3.  During the periods ended December 31, 2008 and 2007, no stock
options were granted to non-employees. Accordingly, no stock-based compensation
expense was recognized for new stock option grants in the Statement of
Operations and Comprehensive Loss at December 31, 2008 and 2007.
 
 Financial
Instruments
 
 The
Company’s financial instruments, as defined under SFAS No. 107, Disclosure about
Fair Value of Financial Instruments, include its cash and cash equivalents,
accounts payable and accrued liabilities. Except as otherwise noted, it is
management’s opinion that the Company is not exposed to significant interest or
credit risks arising from these financial instruments.  The fair value
of these financial instruments approximates their carrying values due to the
short-term maturities of these instruments.
 
 Income
Taxes
 
 The
Company accounts for income taxes under the provisions of SFAS No.109,
“Accounting for Income Taxes.”  SFAS No.109 requires recognition of
deferred income tax assets and liabilities for the expected future income tax
consequences, based on enacted tax laws, of temporary differences between the
financial reporting and tax bases of assets and liabilities.
 
 Recent Accounting
Standards
 
 In
February 2007, the FASB issued SFAS no, 159, “The Fair Value Option for
Financial Assets and Financial Liabilities” (“SFAS 159”).  SFAS 159
provides companies with an option to report selected financials assets and
liabilities at fair value.  The objective of SFAS 159 is to reduce
both complexity in accounting for financial instruments and the volatility in
earnings caused by measuring related assets and liabilities
differently.  Generally accepted accounting principles have required
different measurement attributes for different assets and liabilities that can
create artificial volatility in earnings.  The FASB has indicated it
believes that SFAS 159 helps to mitigate this type of accounting-induced
volatility by enabling companies to report related assets and liabilities at
fair value, which would likely reduce the need for companies to comply with
detailed rules for hedge accounting.  SFAS 159 also establishes
presentation and
  9
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
   NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Recent Accounting Standards
(Continued)
 
 disclosure
requirements designed to facilitate comparisons between companies that choose
different measurement attributes for similar types of assets and
liabilities.  SFAS 159 does not eliminate disclosure requirements
included in other accounting standards, including requirements for disclosures
about fair value measurements included in SFAS 157 and SFA No. 107, “Disclosures
about Fair Value of Financial Instruments.” SFAS 159 is effective for the
Company as of the beginning of fiscal year 2009.  The adoption of this
pronouncement is not expected to have an impact on the Company’s financial
position, results of operations or cash flows.
 
 In
December 2007, the FASB issued No. 160, “Noncontrolling Interests in Financial
Statements, an amendment of ARB No. 51" (“SFAS 160").  SFAS 160 amends
ARB 51 to establish accounting and reporting standards for the noncontrolling
interest in a subsidiary and for the deconsolidation of a
subsidiary.  It clarifies that a noncontrolling interest in a
subsidiary is an ownership interest in the consolidated entity that should be
reported as equity in the consolidated financial statements.  This
Statement is effective for fiscal years beginning on or after December 15,
2008.  Early adoption is not permitted. Management is currently
evaluating the effects of this statement, but it is not expected to have any
impact on the Company’s financial statements.
 
 In
December 2007, the FASB issued No. 141(R),  “Business Combinations”
(“SFAS 141(R)”.  SFAS 141(R) provides companies with principles and
requirements on how an acquirer recognizes and measures in its financial
statements the identifiable assets acquired, liabilities assumed, and any
noncontrolling interest in the acquiree as well as the recognition and
measurement of goodwill acquired in a business combination. SFAS 141(R) also
requires certain disclosures to enable users of the financial statements to
evaluate the nature and financial effects of the business combination.
Acquisition costs associated with the business combination will generally be
expensed as incurred. SFAS 141(R) is effective for business combinations
occurring in fiscal years beginning after December 15, 2008, which will require
the Company to adopt these provisions for business combinations occurring in
fiscal 2009 and thereafter. Early adoption of SFAS 141(R) is not
permitted.  Management is currently evaluating the effects of this
statement, but it is not expected to have any impact on the Company’s financial
statements.
  10
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
   NOTE 1 - ORGANIZATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Recent Accounting Standards
(Continued)
 
 In March
2008, the FASB issued No. 161, “Disclosures about Derivative Instruments and
Hedging Activities, an amendment of FASB Statement No. 133.  (“SFAS
161").  SFAS 161 requires enhanced disclosures about an entity's
derivative and hedging activities and thereby improves the transparency of
financial reporting.  This Statement is effective for financial
statements issued for fiscal years and interim periods beginning after November
15, 2008, with early application encouraged. This Statement encourages, but does
not require, comparative disclosures for earlier periods at initial
adoption.  Management is currently evaluating the effects of this
statement, but it is not expected to have any impact on the Company’s financial
statements.
 
 NOTE 2 - INCOME
TAXES
 
 2008
                
                
                2007Net
      Operating Losses
                
                $
                4,250,000
                
                
                $
                3,963,988Accrued
      Consulting Fees
                
                
                33,000
                
                
                
                39,251Valuation
      Allowance
                
                
                (4,283,000
                )
                
                
                (4,003,239
                )$
                -
                
                
                $
                -
  As of
December 31, 2008, the Company had a net operating loss carry forward for income
tax reporting purposes of approximately $12,510,000 that may be offset against
future taxable income through 2025.  Current tax laws limit the amount
of loss available to be offset against future taxable income when a substantial
change in ownership occurs.  Therefore, the amount available to offset
future taxable income may be limited.  No tax benefit has been
reported in the financial statements, because the Company believes there is a
50% or greater chance the carryforwards will expire
unused.  Accordingly, the potential tax benefits of the loss
carryforwards are offset by a valuation allowance of the same
amount.
  11
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 2 - INCOME TAXES
(Continued)
 
 The
provision for income taxes differ from the amount computed using the federal US
statutory income tax rate as follows:
 2008
                
                
                2007Provision
      (Benefit) at US Statutory Rate
                
                $
                (413,854
                )
                
                $
                (141,145
                )Stock
      Compensation / Interest
                
                
                127,500
                
                
                
                -Excess
      Capital Losses over Capital Gains
                
                
                (3,400
                )
                
                
                -Accrued
      Consulting Fees
                
                
                7,421
                
                
                
                -Depreciation
      and other
                
                
                2,572
                
                
                
                (75
                )Increase
      (Decrease) in Valuation Allowance
                
                
                279,761
                
                
                
                141,220$
                -
                
                
                $
                -
 
 The
Company evaluates its valuation allowance requirements based on projected future
operations.  When circumstances change and causes a change in
management’s judgment about the recoverability of deferred tax assets, the
impact of the change on the valuation is reflected in current
income.
 
 NOTE 3 - DEVELOPMENT STAGE
COMPANY/GOING CONCERN
 
 The
Company has not commenced its intended principal operations and as is common
with a development stage company, the Company has had recurring
losses.  Continuation of the Company as a going concern is dependent
upon obtaining the additional working capital necessary to be successful in its
planned activity, and the management of the Company has developed a strategy,
which it believes will accomplish this objective through additional equity
funding and long term financing, which will enable the Company to operate for
the coming year.
 
 NOTE 4- INVESTMENT IN OIL
& GAS PROPERTY
 
 In
January of 2008 the company acquired an option to purchase a 6,000 acre Oil
& Gas property located in the state of Ohio.  The
closing date of the transaction was extended to July 31, 2008 and was subject to
financing.Pursuant
to the agreement, the Company paid the seller $325,000 in cash and issued
125,000 shares of stock valued at $58,750 for the acquisition and extension of
the agreement.  The Company had capitalized a total of $475,949
related to this property.
 
 In
October, the company issued notice to the landowner of the Ohio Oil & Gas
property of its intent to not pursue the acquisition of the
project.  The company has also issued a demand letter to the land
owner for the return of the $300,000 paid in June for the
extension.  No response has been received from the land owner to date;
the company will continue to pursue the return of the funds.  Since
the entire amount is deemed abandoned on December 31, 2008, $475,949 has been
written off as an exploration expense.
  12
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 5 – INVESTMENT IN
MINERAL PROPERTY
 
 In May
2007, we entered into a Purchase Agreement (“Agreement”) with U3, LLC (“U3”) to
acquire a 100% interest in 1,540 acres that consist of 77 claims of prospective
uranium property located adjacent to the Sheep Mountain Mine in Fremont County,
Central Wyoming, approximately 90 miles southwest of Casper,
Wyoming.  We paid $10,000 to U3 when we executed the Agreement on May
28, 2007. However, we later agreed with U3 not to continue to acquire the
claims, due to delays in receiving WMC numbers on the claims, and we have
requested U3 return the $10,000 as per the agreement terms.  The
company did not issue any shares pursuant to this agreement and as of the date
of this report has not received the $10,000.  After numerous attempts
to collect on the $10,000, the company has written the debt off as bad debt
expense.
 
 NOTE 6 - LEASE
AGREEMENT
 
 The
company has entered into a month-to-month lease agreement for an office in
Calgary, Alberta, Canada.  This lease can be canceled on one month’s
written notice. The current lease requires rental payments of approximately $250
($250 Canadian Dollars) per month plus applicable taxes effective October 1,
2007 after consolidating leased space.  Prior to October 1, 2007, the
lease was approximately $4,854 per month plus applicable taxes. For the year
ended December 31, 2008 and 2007 the Company had $3,000 and $14,879 respectively
in rent expense.
 
 During
2008, the Lessor wrote off the entire balance owed to them through March 31,
2008.  The company has recorded $29,025 in forgiveness of debt as of
December 31, 2008.
 
 NOTE 7 - UNCERTAIN TAX
POSITIONS
 
 Effective
January 1, 2007, the Company adopted the provisions of FASB Interpretation No.
48, “Accounting for Uncertainty in Income Taxes - an interpretation of FASB
Statement No. 109” (“FIN 48”). FIN 48 prescribes a recognition threshold and a
measurement attribute for the financial statement recognition and measurement of
tax positions taken or expected to be taken in a tax return. For those benefits
to be recognized, a tax position must be more-likely-than-not to be sustained
upon examination by taxing authorities. The adoption of the provisions of FIN 48
did not have a material impact on the company’s condensed consolidated financial
position and results of operations. At January 1, 2007, the company had no
liability for unrecognized tax benefits and no accrual for the payment of
related interest and penalties. The Company did not record a cumulative effect
adjustment relating to the adoption of FIN 48.
  13
  ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 7 - UNCERTAIN TAX
POSITIONS - CONTINUED
 
 Interest
costs related to unrecognized tax benefits are classified as “Interest expense,
net” in the accompanying condensed consolidated statements of operations.
Penalties, if any, would be recognized as a component of “Selling, general and
administrative expenses”. The Company recognized $0 of interest and penalties
expense related to unrecognized tax benefits during 2007. In many cases the
company’s uncertain tax positions are related to tax years that remain subject
to examination by relevant tax authorities. With few exceptions, the company is
generally no longer subject to U.S. federal, state, local or non-U.S. income tax
examinations by tax authorities for years before 2004. The following describes
the open tax years, by major tax jurisdiction, as of December 31,
2007:
  United
      States (a)
                2004
      - Present
 
 (a)
Includes federal as well as state or similar local jurisdictions, as
applicable.
 
 NOTE 8 - RELATED PARTY
TRANSACTIONS
 
 As of
March 31, 2009 and December 31, 2008, the Company owed Santeo Financial $107,760
and $89,353 respectfully for consulting services.  Ron Ruskowsky,
President and CEO of the Company is an affiliate of Santeo
Financial.  Currently the Company has an agreement with Santeo
Financial whereby Santeo Financial provides consulting services in exchange the
Company agrees to pay a consultant fee of $15,000 per month.
 
 As of
March 31, 2009 and December 31, 2008, the Company owed Phil Van Angren, an
officer and director of the Company, $7,915 and $7,564 respectfully for
consulting services performed as the Exploration Manager.
 
 As of
March 31, 2009 and December 31, 2008 the Company owed Roger Janssen, an officer
and director of the Company $1,345 for incurred expenses.
 
 As of
March 31, 2009 and December 31, 2008, shareholders have advanced the Company
$19,845, payable on demand and do not carry an interest rate.  This
transaction has been recorded in the accompanying financial statements as
Shareholder loans.
  14
 
 ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 9 - COMMON STOCK AND
WARRANTS
 
 In March
2009 the Company announced its intent to raise up to USD $1 million through the
issuance of up to 400 units at a price of USD $2,500 per unit
(“Unit”).  The funds were to be used for participation in the drilling
of oil & gas wells in the state of Oklahoma and for working
capital.  Each Unit was to consist of 5,000 restricted common shares
of the Company and would pay a dividend to the unit holder on a portion of the
revenue received from the wells.  In addition, each unit would carry
an option to purchase shares in the Company at $0.25 per share for a period of
18 months.
 
 In June
2008 the company received a loan of $500,000 from a private
investor.  The loan carried an interest rate of 15% and was due and
payable on or before July 31, 2008.  The terms of the note allow for a
1% per week penalty up to a maximum of 10%.  As part of the agreement,
6,250,000 shares were placed into escrow for security.  The Lender had
the right at his sole discretion, to convert any unpaid debt, along with any
interest due, into free-trading common stock of the Company at a conversion
price of forth cents ($0.40) per share.  The funds from this loan were
used for the Ohio Property Extension payment, payment for a third party
engineering evaluation of the Ohio Property and working capital.  In
September 2008 the company issued 6,250,000 shares held in escrow as
satisfaction for the $500,000 note due plus interest of $75,000 and penalties of
$50,000 to a private investor at a value of ten cents ($0.10) per
share.  The market value of the shares was sixteen cents ($0.16) the
date the loan was satisfied resulting in additional interest booked on the
financial statements of $375,000 at December 31, 2008.
 
 In May
2008, the Company issued 580,000 shares in a private placement for $0.25 per
Unit.  Each Unit entitled the holder to acquire 1 common share of the
company’s stock at $0.25 per share and one share purchase warrant, entitling the
holder to purchase one share at a price of $0.40 for a period of 12 months from
closing of the private placement, resulting in the Company
 receiving
$145,000 in cash.  The shares were issued in a transaction which the
Company believes satisfies the requirements of the Regulation S exemption from
the registration and prospectus delivery requirements of the Securities Act of
1933. The Company used those funds for working capital.
 
 In April
of 2008 the Company issued 100,000 shares in a private placement for $.25 per
share which resulted in the Company receiving $25,000 in cash.  The
shares were issued in a transaction which the Company believes satisfies the
requirements of the Regulation S exemption from the registration and prospectus
delivery requirements of the Securities Act of 1933. The Company used those
funds for working capital.
 
 In April
of 2008 the Company issued 125,000 shares of restricted stock recorded at $0.47
per share along with a $25,000 cash payment in consideration for an extension on
the Anderson Oil & Gas property to May 30, 2008.
  15
 ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 9 - COMMON STOCK AND
WARRANTS (Continued)
 
 In March
of 2008 we issued 50,000 shares to M2 Law in settlement of outstanding legal
invoices totaling $50,000. The shares were recorded at $0.65 per share for a
value of $32,500 and the difference of $17,500 was booked as forgiveness of
debt.
 
 In March
2008, the Company issued 1,820,000 shares in a private placement for $0.10 per
Unit.  Each Unit entitled the holder to acquire 1 common share of the
company’s stock at $0.10 per share and one share purchase warrant, entitling the
holder to purchase one share at a price of $0.15 for a period of 18 months from
closing of the private placement, resulting in the company receiving $182,000 in
cash.  The shares were issued in a transaction which the Company
believes satisfies the requirements of the Regulation S exemption from the
registration and prospectus delivery requirements of the Securities Act of 1933.
The Company used those funds for working capital.
 
 On June 26, 2007 the Company
issued 333,333 shares of common stock to Randall Lanham in total satisfaction of
legal fees in the amount of $20,000.
 
 On May 9,
2007 the company issued 500,000 shares to Phil van Angeren as compensation for
his assuming the position of Exploration Manager of the Corporation. These
shares have been valued at the market price of $0.29.  Compensation
expense of $145,000 has been booked on the accompanying Statement of
Operations.
 
 In
February 2007, the Company issued 2,653,640 shares in a private placement for
$.05 per share which resulted in the Company receiving $132,682 in
cash.  The shares were issued in a transaction which the Company
believes satisfies the requirements of the Regulation S exemption from the
registration and prospectus delivery requirements of the Securities Act of 1933.
The Company is using those funds for working capital.
  NOTE 10 – NOTES
PAYABLE
  The
Company has a note payable with Integrated Business Concepts, Inc. that is due
upon demand and carries and interest rate of 12%.  As of March 31,
2009 the amount owing on the notes is $­­­­­243,463 which
consists of principal in the amount of $175,245 and interest of
$68,218.
 
 NOTE 11 – SUBSEQUENT
EVENTS
  In April
the company accepted a debt settlement from Santeo Financial Corporation in the
amount of $15,000 in exchange for a 4% interest in the Company’s share of the
net revenue received from the Gleason Well.
  16
 ROYAL QUANTUM
GROUP, INC.
 (A
Development Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE 3
MONTHS ENDED March 31 2009 AND 2008
 NOTE 11 – SUBSEQUENT EVENTS
(Continued)
 
 In May
the company closed its intended unit funding at 64 units totaling
$160,000.  The Company will earn a 36% participation in the Gleason
#4-16, with 67% of the company’s net revenue received being allocated
proportionally to the unit holders.
 
 As of the
date of this report drilling of the Gleason #4-16 has been
completed.  Initial review of the logs indicates the potential for 3
productive zones, the Oswego, Skinner and Viola.  A completion rig is
scheduled to move onto the location in the coming weeks.
  17
 
 Item 2.  Plan of
Operation
 
 This
following information specifies certain forward-looking statements of management
of the company. Forward-looking statements are statements that estimate the
happening of future events and are not based on historical fact. Forward-looking
statements may be identified by the use of forward-looking terminology, such as
“may”, “shall”, “could”, “expect”, “estimate”, “anticipate”, “predict”,
“probable”, “possible”, “should”, “continue”, or similar terms, variations of
those terms or the negative of those terms. The forward-looking statements
specified in the following information have been compiled by our management on
the basis of assumptions made by management and considered by management to be
reasonable. Our future operating results, however, are impossible to predict and
no representation, guaranty, or warranty is to be inferred from those
forward-looking statements.
 
 The
assumptions used for purposes of the forward-looking statements specified in the
following information represent estimates of future events and are subject to
uncertainty as to possible changes in economic, legislative, industry, and other
circumstances. As a result, the identification and interpretation of data and
other information and their use in developing and selecting assumptions from and
among reasonable alternatives require the exercise of judgment. To the extent
that the assumed events do not occur, the outcome may vary substantially from
anticipated or projected results, and, accordingly, no opinion is expressed on
the achievability of those forward-looking statements. We cannot guaranty that
any of the assumptions relating to the forward-looking statements specified in
the following information are accurate, and we assume no obligation to update
any such forward-looking statements.
 
 Critical Accounting Policy and
Estimates.Our Management's Discussion and Analysis of Financial
Condition and Results of Operations section discusses our financial statements,
which have been prepared in accordance with accounting principles generally
accepted in the United States of America. The preparation of these financial
statements requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. On an on-going basis, management evaluates its estimates and
judgments, including those related to revenue recognition, accrued expenses,
financing operations, and contingencies and litigation. Management bases its
estimates and judgments on historical experience and on various other factors
that are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying value of assets and
liabilities that are not readily apparent from other sources. Actual results may
differ from these estimates under different assumptions or conditions. The most
significant accounting estimates inherent in the preparation of our financial
statements include estimates as to the appropriate carrying value of certain
assets and liabilities which are not readily apparent from other
sources.
 
 These
accounting policies are described at relevant sections in this discussion and
analysis and in the notes to the financial statements included in our Quarterly
Report on Form 10-Q for the period ended March 31, 2009.
 
 Overview .Royal
Quantum Group Inc. is a public company trading on the OTCBB market under the
symbol RYQG.  Royal Quantum is focused on the acquisition, exploration
and development of oil and gas and mineral properties located within favorable
geo-political climates.
  In
February 2007 and in reliance on the exemption from registration under
Regulation S, we sold 2,653,640 shares at $0.05 for a total of $132,682. We used
those funds for working capital.
 
 On May 9,
2007 we issued 500,000 shares to Phil van Angeren as compensation for his
assuming the position of Exploration Manager of the Corporation. These shares
have been valued at the market price of $0.29.  Compensation expense
of $145,000 has been booked on the accompanying Statement of
Operations.
  18
  In May
2007, we entered into a Purchase Agreement (“Agreement”) with U3, LLC (“U3”) to
acquire a 100% interest in 1,540 acres that consist of 77 claims of prospective
uranium property located adjacent to the Sheep Mountain Mine in Fremont County,
Central Wyoming, approximately 90 miles southwest of Casper,
Wyoming.  We paid $10,000 to U3 when we executed the Agreement on May
28, 2007. However, we later agreed with U3 not to continue to acquire the
claims, due to delays in receiving WMC numbers on the claims, and we have
requested U3 return the $10,000 as per the agreement terms.  We did
not issue any shares pursuant to this Agreement and as of the date of this
report have also not received the $10,000.
 
 On June
26, 2007, we issued 333,333 shares of common stock to Randall Lanham in total
satisfaction of legal fees in the amount of $20,000.
  In
January of 2008 the company acquired an option to purchase a 6,000 acre Oil
& Gas property located in the state of Ohio. The closing date of
the transaction was extended to July 31, 2008 and was subject to
financing.
 
 In
February of 2008 the company signed an agreement with First Diversified
Financial Services (FDFS) and Launchpad Capital to assist the company in
securing the necessary capital for the Anderson Oil and Gas project
acquisition.  The agreement required payment of USD $100,000 to FDFS
as well as 3% of any cash received and 2% of any debt financing completed as a
result of FDFS’s efforts.  Launchpad Capital was to receive a fee of
3.5% of the debt and/or equity portion of the funding received by the company as
a result of their efforts.
 
 In March
2008, the Company issued 1,820,000 shares in a private placement for $0.10 per
Unit.  Each Unit entitled the holder to acquire 1 common share of the
company’s stock at $0.10 per share and one share purchase warrant, entitling the
holder to purchase one share at a price of $0.15 for a period of 18 months from
closing of the private placement,  resulting in the Company receiving
$182,000 in cash.  The shares were issued in a transaction which the
Company believes satisfies the requirements of the Regulation S exemption from
the registration and prospectus delivery requirements of the Securities Act of
1933. The Company used those funds for working capital.
 
 In April
of 2008 we issued 125,000 shares of restricted stock recorded at $0.47 per share
along with a $25,000 cash payment in consideration for an extension on the
Anderson Oil & Gas property to May 30, 2008.
 
 In March
of 2008 we issued 50,000 shares to M2 Law in settlement of outstanding legal
invoices totaling $50,000. The shares were recorded at $0.65 per share for a
value of $32,500 and the difference of $17,500 was booked as forgiveness of
debt.
 
 In April
of 2008 the company issued 100,000 shares in a private placement for $.25 per
share which resulted in the Company receiving $25,000 in cash.  The
shares were issued in a transaction which the Company believes satisfies the
requirements of the Regulation S exemption from the registration and prospectus
delivery requirements of the Securities Act of 1933. The Company used those
funds for working capital.
 
 In May
2008, the Company issued 580,000 shares in a private placement for $0.25 per
Unit.  Each Unit entitled the holder to acquire 1 common share of the
company’s stock at $0.25 per share and one share purchase warrant, entitling the
holder to purchase one share at a price of $0.40 for a period of 12 months from
closing of the private placement, resulting in the Company receiving $145,000 in
cash.  The shares were issued in a transaction which the Company
believes satisfies the requirements of the Regulation S exemption from the
registration and prospectus delivery requirements of the Securities Act of 1933.
The Company used those funds for working capital.
 
 In June
2008 the company received a loan of $500,000 from a private
investor.  The loan carried an interest rate of 15% and was due and
payable on or before July 31, 2008.  The terms of the note allow for a
1% per week penalty up to a maximum of 10% at which time the note and all
outstanding interest and penalties will be converted into 6,250,000 shares of
the company’s stock. The Lender had the right at his sole discretion, to convert
any unpaid debt, along with any interest due, into free-trading common stock of
the Company at a conversion price of forty cents ($0.40) per share. The funds
from this loan were used for the Ohio Property Extension payment, payment for a
third party engineering evaluation of the Ohio Property and working
capital.
  19
 
 In June
2008 we paid $300,000 in consideration for an extension on the Ohio Oil &
Gas property to July 31, 2008.
 
 In
September 2008 the company issued 6,250,000 shares as settlement for a note
($500,000), interest ($75,000) and penalties ($50,000) totaling $625,000 from a
private lender.
 
 In
October 2008, the company issued notice to the landowner on the Ohio Oil &
Gas property of its intent to not pursue the acquisition of the
project.  The company has also issued a demand letter to the land
owner for the return of the $300,000 paid in June for the
extension.  No response has been received from the land owner to date,
the company will continue to pursue the return of the funds.  Since
the entire amount is deemed abandoned on December 31, 2008, $475,949 has been
written off as an exploration expense.
 
 In March
2009 the Company announced its intent to raise up to USD $1 million through the
issuance of up to 400 units at a price of USD $2,500 per unit
(“Unit”).  The funds were to be used for participation in the drilling
of oil & gas wells in the state of Oklahoma and for working
capital.  Each Unit was to consist of 5,000 restricted common shares
of the Company and would pay a dividend to the unit holder on a portion of the
revenue received from the wells.  In addition, each unit would carry
an option to purchase shares in the Company at $0.25 per share for a period of
18 months.
  Liquidity and Capital
Resources.We had cash of $128,506 as of March 31, 2009,
all of which comprised our total current assets. As of the three month period
ended March 31, 2009, we also had fixed assets of $833 represented by furniture
and fixtures of $1,851 less accumulated depreciation of $1,018. The decrease in
total fixed assets is due solely to depreciation.  We also had $1 in
intangible assets which was represented by our E-learning System which is
related to our former business . Therefore, for the three month period
ended March 31, 2009, we had total assets of $129,340.
 
 For the
three month period ended March 31, 2009, we had $541,652 in total current
liabilities, which was represented by $81,324 in accounts payable, $243,463 in
notes payable, $117,020 in related party accounts payable and $80,000 in
deposits for share subscriptions, and $19,845 in shareholder
loans.  Therefore, for the three months ended March 31, 2009 we had
total liabilities of $541,652. We had no other long term liabilities,
commitments or contingencies.  Other than anticipated explorations
costs associated with the mineral and oil interests that we acquire and
anticipated increases in the legal and accounting costs of being a public
company, we are not aware of any other known trends, events or uncertainties
which may affect our future liquidity.
 
 Results
of Operations.
 
 Revenues.We had no
revenue for the three month period ended March 31, 2009 or for the 3 month
period ended March 31, 2008.
 
 Operating Expenses and Net Loss.We had a loss from operations of $55,949 for the three month period ended
March 31, 2009, as compared to a loss from operations of $143,207 for the three
month period ended March 31, 2008. For the three month period ended March 31,
2009, our operating expenses were comprised of general and administrative
expenses of $6,300 and consulting fees in the amount of $49,650. We also had
$7,144 in interest expense and  a $565 foreign currency exchange loss.
Therefore, our net loss for the 3 month period ending March 31, 2009 was $63,658
as compared to a net loss of $140,823 for the three month period ended March 31,
2008.
 
 Our Plan of Operation for the Next
Twelve Months. Our focus is to acquire oil and gas, mineral and resource
properties for exploration and development with the intent to bring the projects
to feasibility at which time we will either contract out the operations or joint
venture the project to qualified interested parties.
 
 We had
cash of $128,506 as of March 31, 2009. In the opinion of management, our
available funds will not satisfy our working capital requirements for the next
twelve months.
 
 The
company accepted a debt settlement from Santeo Financial Corporation in the
amount of $15,000 in exchange for a 4% interest in the Company’s share of the
net revenue received from the Gleason Well.
  20
 
 In
May the company closed its intended unit funding at 64 units totaling
$160,000.  The Company will earn a 36% participation in the first
well, with 67% of the company’s net revenue received being allocated
proportionally to the unit holders.
 
 As of the
date of this report drilling of the Gleason #4-16 has been
completed.  Initial review of the logs indicates the potential for 3
productive zones, the Oswego, Skinner and Viola.  A completion rig is
scheduled to move onto the location in the coming weeks.
 
 The
company intends to continue to raise additional capital for participation in
additional oil and gas projects.
 
 Our
forecast for the period for which our financial resources will be adequate to
support our operations involves risks and uncertainties and actual results could
fail as a result of a number of factors. We will need to raise additional
capital to expand our operations to the point at which we are able to operate
profitably. Other than anticipated explorations costs associated with the
resource and mineral interests that we acquire and anticipated increases in the
legal and accounting costs of being a public company, we are not aware of any
other known trends, events or uncertainties, which may affect our future
liquidity.
 
 In the
event that we experience a shortfall in our capital, we intend to pursue capital
through public or private financing as well as borrowings and other sources,
such as our officers, directors and principal shareholders. We cannot guaranty
that additional funding will be available on favorable terms, if at
all.  If adequate funds are not available, then our ability to expand
our operations may be significantly hindered. If adequate funds are not
available, we believe that our officers, directors and principal shareholders
will contribute funds to pay for our expenses to achieve our objectives over the
next twelve months.
 
 Our
belief that our officers, directors and principal shareholders will pay our
expenses is based on the fact that our officers, directors and principal
shareholders collectively own approximately 44.7% of our outstanding common
stock. We believe that our officers, directors and principal shareholders will
continue to pay our expenses as long as they maintain their ownership of our
common stock.
 
 We are
not currently conducting any research and development activities.  We
do not anticipate conducting such activities in the near future. We do not
anticipate that we will purchase or sell any significant equipment. In the event
that we expand our customer base, then we may need to hire additional employees
or independent contractors as well as purchase or lease additional
equipment.
 
 Off-Balance Sheet
Arrangements.We have no off-balance sheet
arrangements.
  Item 3. Quantitative and
Qualitative Disclosures about Market Risk
  Not
applicable.
  Item 4. Controls and
Procedures
 
 Evaluation of disclosure controls and
procedures. We maintain controls and procedures designed to ensure that
information required to be disclosed in the reports that we file or submit under
the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in the rules and forms of the
Securities and Exchange Commission. Based upon their evaluation of those
controls and procedures performed as of March 31, 2009, the date of this
report, our chief executive officer and the principal financial officer
concluded that our disclosure controls and procedures were
effective.
 
 Item 4(T). Controls and
Procedures.
 
 Changes in internal controls.There were no changes in our internal control over financial reporting
that occurred during the fiscal quarter covered by this report that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.
  21
  PART
II — OTHER INFORMATION
 
 Item 1. Legal
Proceedings.
 
 None.
 
 Item 1A. Risk
Factors.
 
 Not
applicable.
 
 Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds.
 
 None.
 
 Item 3.  Defaults
Upon Senior Securities
 
 None.
 
 Item
4.  Submission of Matters to Vote of Security
Holders
 
 None.
 
 Item 5.  Other
Information
 
 None.
 
 Item
6.  Exhibits
  31. Rule 13a-14(a)/15d-14(a) Certifications.
 32.
Section 1350 Certifications.
  22
  SIGNATURES
 
 In
accordance with the requirements of the Securities Exchange Act of 1934, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
  Royal
      Quantum Group, Inc.
                  a
      Nevada corporationMay
      14, 2009
                By:
                /s/ Ron
      RuskowskyRon
      Ruskowsky
                  Principal executive officer
                  Principal
      accounting officer
                  President,
      CEO and a director
 May
      14, 2009
              By:
              /s/ Roger
      JanssenRoger
      Janssen
                Vice-President, Secretary and a
      director






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