This Form 10-QSB is the subject of a Form 12b-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM 10-QSB

(Mark One)

[X]	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period endedMarch 31, 2004

[   ]	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from 	to

Commission file number  000-28305

|FAIRCHILD INTERNATIONAL CORPORATION(Exact name of small business issuer as specified in its charter)                        
|----------------------------------------------------------------------------------------------------------------------------
|Nevada(State or other jurisdiction of incorporation or organization)                                                        
|Suite 1220 Park Place, 666 Burrard Street
Vancouver, British Columbia  CanadaV6C 2X8(Address of principal executive offices)
|604.688.7450(Issuer's telephone number)                                                                                     
|                                                                                                                            

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.  Yes [   ]  No[   ]

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 practicable date:

31,387,520 common shares, par value $0.001 as at May 17, 2004

Transitional Small Business Disclosure Format (Check one): Yes [   ]  No [X]









Part I - FINANCIAL INFORMATION

Item 1.	Financial Statements.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

DISCLOSURE

To:	The Shareholders of
	Fairchild International Corporation

It is the opinion of management that the interim financial statements for the quarter ended June 30, 2003 include all adjustments necessary in order to ensure that the financial statements are not misleading.

Vancouver, British Columbia
Date: May 19, 2004

/s/ George Tsafalas
___________________________________________Director of Fairchild International Corporation















FAIRCHILD INTERNATIONAL CORPORATION

|March 31, 2004                    |      
|--------------------------------- | -----
|                                  |      
|                                  | Index
|                                  |      
|Balance Sheets                    | F-1  
|                                  |      
|Statements of Operations          | F-2  
|                                  |      
|Statements of Cash Flows          | F-3  
|                                  |      
|Notes to the Financial Statements | F-4  
|                                  |      
|                                  |      
|                                  |      
|                                  |      

















`FAIRCHILD INTERNATIONAL CORPORATION`

Balance Sheets

(Expressed in US dollars)



|                                                                                                                          | March 31,
2004
$ | December 31,
2003
$
|------------------------------------------------------------------------------------------------------------------------- | ---------------- | -------------------
|                                                                                                                          |                  |                    
|Assets                                                                                                                    |                  |                    
|                                                                                                                          |                  |                    
|Current Assets                                                                                                            |                  |                    
|                                                                                                                          |                  |                    
|Cash and cash equivalents                                                                                                 | 387              | 5,012              
|Accrued revenues and other receivables                                                                                    | -                | 4,533              
|Accounts receivable - related party  (Note 6)                                                                             | 16,119           | 16,119             
|                                                                                                                          |                  |                    
|Total Current Assets                                                                                                      | 16,506           | 25,664             
|                                                                                                                          |                  |                    
|Oil and Gas Interests, successful efforts method  (Note 3)                                                                | 67,558           | 72,844             
|                                                                                                                          |                  |                    
|Total Assets                                                                                                              | 84,064           | 98,508             
|                                                                                                                          |                  |                    
|                                                                                                                          |                  |                    
|Liabilities and Stockholders' Equity                                                                                      |                  |                    
|                                                                                                                          |                  |                    
|Current Liabilities                                                                                                       |                  |                    
|                                                                                                                          |                  |                    
|Accounts payable and accrued liabilities                                                                                  | 40,963           | 22,183             
|Accounts payable - related parties  (Note 4)                                                                              | 15,135           | 31,370             
|                                                                                                                          |                  |                    
|Total Current Liabilities                                                                                                 | 56,098           | 53,553             
|                                                                                                                          |                  |                    
|                                                                                                                          |                  |                    
|Long-term Liabilities                                                                                                     |                  |                    
|                                                                                                                          |                  |                    
|Asset retirement obligation                                                                                               | 5,156            | 5,000              
|                                                                                                                          |                  |                    
|Total Liabilities                                                                                                         | 61,254           | 58,553             
|                                                                                                                          |                  |                    
|Stockholders' Equity                                                                                                      |                  |                    
|                                                                                                                          |                  |                    
|Preferred Stock                                                                                                           |                  |                    
|Authorized: 1,000,000 shares, with a $0.01 par value; none issued                                                         | -                | -                  
|                                                                                                                          |                  |                    
|Common Stock                                                                                                              |                  |                    
|Authorized: 50,000,000 shares, with a $0.001 par value;
Issued: 30,606,217 shares (December 31, 2003 - 29,085,586 shares) | 30,606           | 29,086             
|                                                                                                                          |                  |                    
|Less: Subscriptions receivable                                                                                            | (21,000)         | -                  
|                                                                                                                          |                  |                    
|Additional Paid-In Capital                                                                                                | 2,263,808        | 2,201,738          
|                                                                                                                          |                  |                    
|Deficit                                                                                                                   | (2,250,604)      | (2,190,869)        
|                                                                                                                          |                  |                    
|Total Stockholders' Equity                                                                                                | 22,810           | 39,955             
|                                                                                                                          |                  |                    
|Total Liabilities And Stockholders' Equity                                                                                | 84,064           | 98,508             
|                                                                                                                          |                  |                    







FAIRCHILD INTERNATIONAL CORPORATION

Statements of Operations

`(Expressed in US dollars)`





|                                       |  |  | Three months Ended
March 31,
|-------------------------------------- |  |  | ----------------------------
|                                       |  |  |                             
|                                       |  |  |                             
|Revenues                               |  |  |                             
|                                       |  |  |                             
|Oil and gas                            |  |  |                             
|                                       |  |  |                             
|Expenses                               |  |  |                             
|                                       |  |  |                             
|Consulting                             |  |  |                             
|Depletion and amortization             |  |  |                             
|Exploration expenses                   |  |  |                             
|Impairment of oil and gas properties   |  |  |                             
|General and administrative             |  |  |                             
|Management fees                        |  |  |                             
|Oil and gas operating                  |  |  |                             
|Professional fees                      |  |  |                             
|Related Party                          |  |  |                             
|Administration fees                    |  |  |                             
|Consulting                             |  |  |                             
|                                       |  |  |                             
|                                       |  |  |                             
|                                       |  |  |                             
|Net Loss                               |  |  |                             
|                                       |  |  |                             
|Net Loss Per Share - Basic and Diluted |  |  |                             
|                                       |  |  |                             
|Weighted Average Shares Outstanding    |  |  |                             
|                                       |  |  |                             































FAIRCHILD INTERNATIONAL CORPORATION

Statements of Cash Flows

(Expressed in US dollars)



|                                               | Three months Ended
March 31,
|---------------------------------------------- | ----------------------------
|                                               | 2004
$                      
|                                               |                             
|Cash Flows From Operating Activities           |                             
|Net loss                                       | (59,734)                    
|Items not involving cash:                      |                             
|Depletion and amortization                     | 10,153                      
|Impairment of oil and gas properties           | -                           
|Issue of shares for services                   | 30,500                      
|Stock-based compensation                       | 12,090                      
|Changes in operating assets and liabilities:   |                             
|Accounts receivable                            | 4,533                       
|Funds in trust                                 | -                           
|Prepaid cash calls                             | -                           
|Accounts payable and accrued liabilities       | 9,264                       
|Accounts payable - related parties             | (6,720)                     
|                                               |                             
|Net Cash Provided By Operating Activities      | 86                          
|                                               |                             
|                                               |                             
|Investing Activities                           |                             
|Payments to affiliated company                 | -                           
|Oil and gas property costs                     | (4,711)                     
|                                               |                             
|Net Cash Used In Investing Activities          | (4,711)                     
|                                               |                             
|                                               |                             
|Financing Activities                           |                             
|Payments on unit offering                      | -                           
|Common stock issued for cash                   | -                           
|                                               |                             
|Net Cash Provided By Financing Activities      | -                           
|                                               |                             
|                                               |                             
|Decrease in Cash and Cash Equivalents          | (4,625)                     
|                                               |                             
|Cash and Cash Equivalents, beginning of period | 5,012                       
|                                               |                             
|Cash and Cash Equivalents, end of period       | 387                         
|                                               |                             
|                                               |                             
|Non-Cash Financing Activities                  |                             
|                                               |                             
|Stock issued for financing costs               | -                           
|Stock issued for services                      | 30,500                      
|Stock issued on settlement of short-term debt  | -                           
|                                               |                             
|                                               |                             
|                                               |                             
|Supplemental Disclosures                       |                             
|                                               |                             
|Cash paid for taxes                            | -                           
|Cash paid for interest                         | -                           
|                                               |                             

1.	Basis of Presentation and Going Concern Considerations

The unaudited financial information furnished herein reflects all adjustments, which in the opinion of management are necessary to fairly state the Company's financial position and the results of its operations for the periods presented.  This report on Form 10-Q should be read in conjunction with the Company's financial statements and notes thereto included in the Company's Form 10-K for the fiscal year ended December 31, 2003.  The Company assumes that the users of the interim financial information herein have read or have access to the audited financial statements for the preceding fiscal year and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context.  Accordingly, footnote disclosure, which would substantially duplicate the disclosure contained in the Company's Form 10-K for the fiscal year ended December 31, 2003, has been omitted. The results of operations for the three-month period ended March 31, 2004 are not necessarily indicative of results for the entire year ending December 31, 2004.

As of March 31, 2004, the Company had not reached a level of operations which would finance day-to-day activities.  These financial statements have been prepared on the assumption that the Company is a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations.  Different bases of measurement may be appropriate when a company is not expected to continue operations for the foreseeable future.  The Company's continuation as a going concern is dependent upon its ability to attain profitable operations and generate funds therefrom and/or raise equity capital or borrowings sufficient to meet current and future obligations.  The Company incurred losses from operations of $59,734 and $127,756 for the three-month periods ended March 31, 2004 and 2003, respectively.  The Company had working capital deficiencies of $39,592 as of March 31, 2004 and $27,889 as of December 31, 2003. These conditions, among others, give rise to substantial doubt about the Company's ability to continue as a going concern.

2.	Recent Pronouncements

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity". SFAS No. 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. It requires that an issuer classify a financial instrument that is within its scope as a liability (or an asset in some circumstances). The requirements of SFAS No. 150 apply to issuers' classification and measurement of freestanding financial instruments, including those that comprise more than one option or forward contract. SFAS No. 150 does not apply to features that are embedded in a financial instrument that is not a derivative in its entirety. SFAS No. 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003, except for mandatorily redeemable financial instruments of nonpublic entities. It is to be implemented by reporting the cumulative effect of a change in an accounting principle for financial instruments created before the issuance date of SFAS No. 150 and still existing at the beginning of the interim period of adoption. Restatement is not permitted. The adoption of this standard did not have a material effect on the Company's results of operations or financial position.



3.	Oil and Gas Interests



|                                                                           | March 31,
2004 |  | December 31,
2003
|-------------------------------------------------------------------------- | -------------- |  | -----------------
|                                                                           | $              |  | $                
|                                                                           |                |  |                  
|Proved oil and gas properties and related equipment                        |                |  |                  
|- California, USA                                                          | 78,290         |  | 78,290           
|- Saskatchewan, Canada                                                     | 124,309        |  | 122,638          
|                                                                           |                |  |                  
|                                                                           | 202,599        |  | 200,928          
|                                                                           |                |  |                  
|Non-producing oil and gas properties                                       |                |  |                  
|- Texas, USA                                                               | 13,196         |  | 10,000           
|- Saskatchewan, Canada                                                     | -              |  | -                
|                                                                           |                |  |                  
|                                                                           | 13,196         |  | 10,000           
|                                                                           |                |  |                  
|Sub-total                                                                  | 215,795        |  | 210,928          
|Accumulated depreciation, depletion, amortization and valuation allowances | (148,237)      |  | (138,084)        
|                                                                           |                |  |                  
|Balance, end of period                                                     | 67,558         |  | 72,844           

3.	Oil and Gas Interests (continued)

Oil and Gas Interests - California, USA

The Company has a 5% working interest in three wells and a 2.7% working interest in a fourth well in Tehama County, California.  The Company has conveyed to a corporate related party 20% of its interest as additional consideration for providing a loan to assist the Company in acquiring its interest in the project.

Oil and Gas Interests - Saskatchewan, Canada

Under a participation agreement entered into in 2002, the Company has a 4.167% working interest in the first set of ten wells drilled in Kerrobert, Saskatchewan.  During the year ended December 31, 2003, the Company entered into a second participation agreement to earn a 1.75% interest in a second set of nine additional wells drilled.  The agreements are with a Company with a common officer.  The Company has an option to acquire a 6.75% working interest in future oil wells in the Kerrobert drilling program.



Oil and Gas Interests - Texas, USA

The Company entered into an agreement dated November 6, 2003 to earn a 1.875% interest in a test well by incurring 1.875% of the costs associated with the acquisition of the interest.  The agreement is with a Company with a common officer.

The Company entered into assignment agreements dated February 23, 2004 pursuant to the terms of a sub-participation agreement dated November 6, 2003 between the Company and Patch Energy Inc. (Patch), where the Company was granted the right to earn a 1.875% interest in the Test Well and the Program Lands, being a one-half share of the interest, in consideration of incurring an equal percentage of the costs associated with the acquisition of the Interest.  The Company has assigned two fifths of its interest in the sub-participation agreement, being the right to earn an interest of 0.375 of 1% in the Test Well and the Program Lands, in consideration of the assumption of an equal share (2/5) of the Company's costs under the sub-participation agreement.

Oil and Gas Interest - Naftogaz, Ukraine

The Company entered into a memorandum of understanding with a company with a common officer, dated November 7, 2003, under which the Company may participate in negotiations to undertake petroleum and natural gas exploration and development activities in the Ukraine.

4.	Related Party Transactions



1. The Company shares office facilities and has common management and directorships with a number of public and private corporate related parties. The Company is charged for office rentals and administrative services on a shared cost basis.  Related parties include directors and officers and companies with common management and directorships.  Related party accounts are unsecured with no fixed terms of interest or repayment.
2. Management agreements were entered into for administration fees with directors and officers aggregating $5,500 per month commencing April 1, 2003 and May 1, 2003, each for a term of three years.  During the three-month period ended March 31, 2004, the Company incurred administration fees of $16,500 (2003 - $nil), and consulting fees of $NIL (2003 - $26,400).

5.	Common Stock



1. Non-cash consideration

Shares issued for non-cash consideration were valued based on the average market price of the Company's stock from the five days preceding the date of issuance, and the amount of management fees being settled.

On January 7, 2004, the Company issued 215,908 shares of common stock for management services with a fair value of $9,500.

On February 2, 2004, the Company issued 288,460 shares of common stock for management services with a fair value of $10,500.

On March 1, 2004 the Company issued 316,263 shares of common stock for management services with a fair value of $10,500.  Refer to Note 7.



5.	Common Stock (continued)



a.	Non-cash consideration (continued)

During the prior three-month period ended March 31, 2003, the Company issued 909,560 shares of common stock to settle short-term debt with a fair value of $80,217.



b.	Incentive Stock Options

The Company adopted a Stock Option Plan dated September 15, 2003 ("the 2003 Stock Option Plan") under which the Company is authorized to grant options to acquire up to a total of 3,607,654 common shares.  The term of any stock options granted under the plan is limited to ten years.

A summary of the Company's stock option activity is as follows:



|                            | March 31, 2004  
|--------------------------- | ----------------
|                            | Number of shares
|                            |                 
|Balance, beginning of year  | 1,328,334       
|Options granted             | 2,100,000       
|Options exercised           | (700,000)       
|Options cancelled / expired | -               
|                            |                 
|Balance, end of year        | 2,728,334       



|Exercise price | Weighted Average
Remaining
Contractual Life(in years) |  | March 31, 2004
|-------------- | ----------------------------------------------------- |  | --------------
|Outstanding    | Exercisable                                          
|               |                                                       |  |               
|$0.00 - $0.05  | 2.56                                                  |  | 2,233,334     
|$0.06 - $0.10  | 1.60                                                  |  | 195,000       
|$0.21 - $0.25  | 0.44                                                  |  | 300,000       
|               |                                                       |  |               
|               |                                                       |  | 2,728,334     

On February 24, 2004, the Company granted options to purchase 2,100,000 shares at an exercise price of $0.03 per share.  Of these stock options, 900,000 are exercisable on or before February 24, 2005, and the remaining 1,200,000 are exercisable on or before February 24, 2009.  During the period ended March 31, 2004, 700,000 of these stock options were exercised and the proceeds of $21,000 are included in subscriptions receivable, as the proceeds were received subsequently.

The fair value of the options granted during the period was estimated at the date of grant using the Black-Scholes option pricing model with the following assumptions: risk free interest rate of 1.01%, expected volatility of 150%, an expected option life of 1 year and no expected dividends. The weighted average fair value of options granted was $0.02 per share.  Had the Company determined compensation cost based on the fair value at the date of grant for its employee stock options, the net loss would have increased by $13,536 for the period ended March 31, 2004.  During the three-month period ended March 31, 2004, the Company recognized stock-based compensation in the amount of $12,090.





5.	Common Stock (continued)

b.	Incentive Stock Options (continued)

The following table illustrates the effect on net loss per share as if the fair value method had been applied to all outstanding and unvested awards in each period.



|                                                                            |  | Three months ended
March 31,
|--------------------------------------------------------------------------- |  | ----------------------------
|                                                                            |  | 2004
$                      
|                                                                            |  |                             
|Net loss - as reported                                                      |  | (59,734)                    
|Add: Stock-based compensation expense included in net loss - as reported    |  | 12,090                      
|Deduct: Stock-based compensation expense determined under fair value method |  | (25,626)                    
|                                                                            |  |                             
|Net loss - pro forma                                                        |  | (73,270)                    
|                                                                            |  |                             
|Net loss per share (basic and diluted) - as reported                        |  | (0.002)                     
|Net loss per share (basic and diluted) - pro forma                          |  | (0.002)                     

6.	License

The Company entered into a letter of agreement dated February 18, 2004 with Praxis Pharmaceuticals Inc.  (Praxis) where the Company and Praxis have agreed to be bound by the terms of the original Termination of License and Research and Development Agreement (the "License Agreement") dated February 28, 2001.  The letter agreement confirms that all amendments to such License Agreement are no longer in force and effect.  As a result, Praxis will retain the common shares of the Company assigned to it under the terms of the License Agreement and will pay to the Company 30% of the net revenues in the License Agreement to a maximum of $250,000 over the first three years of sale.  To date, the Company has received $59,423 from Praxis.

7.  Subsequent Events

a.	The Company issued 426,827 shares for management services with a fair value of $10,500.

b.	The Company granted 400,000 stock options at a price of $0.025 per share exercisable on or before April 23, 2009.





Item 2.	Management's Plan of Operation.

FORWARD-LOOKING STATEMENTS

This quarterly report contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995.  These statements relate to future events or our future financial performance.  In some cases, you can identify forward-looking statements by terminology such as "may", "will", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology.  These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors", that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.  Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

As used in this quarterly report, the terms "we", "us", "our", and "Fairchild" mean Fairchild International Corporation, unless otherwise indicated.

All dollar amounts refer to US dollars unless otherwise indicated.

The following discussion should be read in conjunction with our consolidated financial statements and the related notes that appear elsewhere in this quarterly report.  The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs.  Our actual results could differ materially from those discussed in the forward looking statements.  Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report, particularly in the section entitled "Risk Factors".

Corporate History

Fairchild was incorporated on June 20, 1997 under the laws of the State of Nevada under the name Goanna Resources, Inc.  On June 24, 1999 we changed our name to Fairchild International Corporation.

Our Current Business

Tehama County, California

On April 15, 2002, we entered into a Farmout Agreement with Whittier Energy Company (formerly Olympic Resources (Arizona) Ltd.) wherein we have the right to earn from Whittier an assignment of Whittier's interest in oil and gas leasehold interests in certain lands located in Tehama County, California. Pursuant to the Farmout Agreement, upon payment of a fee of $15,000 for each test well, representing payment for a 3.75% interest in the information and data relating to each test well, and 5% of the costs of drilling and completion as set forth in the Farmout Agreement, we could earn and Whittier would assign a 3.75% undivided interest in five test wells.  We had the right to earn a reduced 2.025% interest in a further test well upon payment of 2.7% of the drilling and completion costs and payment of a fee of $8,100 for a 2.025% interest in the data and information with respect to such well.  During the year ended December 31, 2002, we acquired a 3.75% undivided interest in four test wells, and incurred net expenditures under the Farmout Agreement of $102,107, which figure includes the allocation to Patch Energy Inc. ("Patch") of its 20% working interest in our 3.75% interest.  For the quarter ended March 31, 2004, we have earned a total of $2,666 in revenue net of royalties from our interest in the four test wells.





Saskatchewan, Canada

On June 25, 2002, we entered into a participation agreement with Patch to participate in a sixty well drilling program.  The oil field is located in Saskatchewan, Canada in the area known as the Kerrobert in the Viking Formation near the Alberta-Saskatchewan Border.Under this participation agreement, we had the right to earn a 12.5% interest in certain drilled wells by incurring, subject to financing, 15.625% of the costs associated with a 10 test well drilling program.  This interest represents one-half of the interest which was otherwise then held by Patch under a farmout agreement with True Energy Inc., a Toronto Stock Exchange listed company, as operator.  We subsequently entered into a new agreement with Patch to reduce our participation.

On December 2, 2002 we entered into a new participation agreement with Patch which replaced the agreement of June 25, 2002.  Pursuant to the terms of a farmout and joint operating agreement dated May 1, 2002 between Patch, True Energy Inc. and Arsenal Energy Inc., Patch had the right to earn a 12.5% interest in the Farmout Lands (as defined in the Farmout Agreement) by incurring 15.625% of the costs (the "Initial Costs") associated with the Test Wells (as defined in the Farmout Agreement).

Pursuant to the terms of the participation agreement, Fairchild had the right to earn up to a one-third (1/3) share of the Interest (the "Partial Interest"), being a 4.167% interest in the 10 Test Wells in consideration of incurring an equal portion of the costs to a maximum of 5.208% of the costs associated with the Test Wells.  In order for Fairchild to earn a Partial Interest, it was to pay for costs otherwise to be incurred by Patch pursuant to the terms of the Farmout Agreement, equal to the amount of the Partial Interest to be earned by Fairchild (the "Partial Costs") and Fairchild was to pay such Partial Costs as and when requested by Patch in order that Patch might fulfil its obligations under the Farmout Agreement in respect of the Partial Costs provided that, if Fairchild failed to make such payments, its right to earn the Partial Interest would cease and the agreement was to be terminated.   We have earned the 4.167% interest and, in connection therewith, incurred $87,938 as our share of the costs associated with the Test Wells as of December 31, 2003.  For the three months ended March 31, 2004, we earned $5,726 in revenue net of royalties from our interest in the 10 test wells.

On February 10, 2003, we entered into another participation agreement with Patch in order to earn a partial interest in a further 9 well drill program (the "Second Program").  The Second Program is now complete.  We have earned our 1.75% interest, being a one-sixth share of the interest of Patch in the Second Program.  For the three months ended March 31, 2004 we expended $200 representing our 2.5% portion of the costs associated with the Second Program and earned a total of $2,406 in revenue net of royalties from our interest in the Second Program.

On April 3, 2003, we entered into an amendment agreement (the "Amendment Agreement") to the participation agreement dated February 10, 2003 with Patch.  Patch has confirmed with Fairchild that its ability to continue to earn a 12.5% interest in any wells drilled on certain lands located in the Kerrobert Area of Saskatchewan, Canada, under the terms of a Farmout and Joint Operation Agreement with Arsenal Energy and True Energy, as operator, is contingent upon Patch paying 15.625% of the costs associated with such wells.  The Amendment Agreement provides that Fairchild was obligated to incur 2.5% of the costs associated with the second 9 well drill program on the Farmout Lands in order to earn a 1.75% interest in such wells, as opposed to incurring 1.75% of the costs as the original participation agreement provided for, reflecting the increased costs to which Patch is subject.

On November 5, 2003, we entered into a participation agreement with Patch in order to earn a 6.75% working interest in future oil wells in the Kerrobert drilling program in consideration of incurring 8.4375% of the costs associated with any such subsequent wells.  No further wells have been drilled on the Farmout Lands subsequent to the entering into of this agreement.

Manahuilla Creek,  Texas, USA

On November 6, 2003 we entered into a participation agreement with Patch to participate in an oil and gas prospect located in Goliad County, Texas.  Patch holds an agreement with PB Energy USA, Inc. ("PB") whereby Patch has a right to acquire a 3.75% participating working interest in a test well and the oil and gas lands leased by PB in Goliad County by paying 5% of the acquisition costs ($15,000), 5% of the costs of the test well and 3.75% of the costs relating to the development of the oil and gas lands.  Under our agreement with Patch (the "Sub-Participation Agreement") we have a right to earn one-half of Patch's interest (1.875%) by paying one-half of Patch's costs.  As at March 31, 2004, we have paid Patch $7,500 being one-half of the $15,000 previously paid by Patch on account of the acquisition costs and $15,696 against future costs to be incurred.

On February 23, 2004, we entered into an assignment agreement whereby we agreed to assign to Habanero Resources Inc. one-fifth (1/5) of our interest in the Sub-Participation Agreement, being the right to earn a .375% interest in the test well and the program lands in consideration of Habanero assuming an equal share (1/5) of our costs under the Sub-Participation Agreement.  As at March 31, 2004, Habanero has advanced to us $5,000 against future costs to be incurred.

As well, on February 23, 2004, we entered into an assignment agreement whereby we agreed to assign to Micron Enviro Systems Inc. one-fifth (1/5) of our interest in the Sub-Participation Agreement, being the right to earn a .375% interest in the test well and the program lands in consideration of Micron assuming an equal share (1/5) of our costs under the Sub-Participation Agreement.  As at March 31, 2004, Micron has advanced to us $5,000 against future costs to be incurred.

Naftogaz, Ukraine

On November 7, 2003 we entered into an agreement with Patch whereby Patch agreed to negotiate with us so as to give Fairchild the opportunity to participate in any venture Patch may become involved in as a result of its relationship with NAFTOGAZ, the Ukranian State oil company.  To date no such ventures have been finalized.

General

Pursuant to the Management Agreement dated April 1, 2003 with George Tsafalas our company's President, we agreed to pay to Mr. Tsafalas a monthly salary of $4,500 commencing April 1, 2003 and ending March 31, 2006, representing an annual salary of $54,000 for a three year term. Pursuant to the terms of this agreement we may satisfy our obligations in respect of payment of the salary to Mr. Tsafalas in any month during the term of the agreement by the issuance of such number of shares of our common stock at a deemed price equal to the average bid price of our common stock on the OTC Bulletin Board for the last five trading days of such month as having a value equal to the salary then otherwise payable.  As at March 31, 2004, we had issued 361,440 shares of our common stock to Mr. Tsafalas in lieu of salary otherwise payable to him.

Pursuant to the Management Agreement dated April 1, 2003 with David Stadnyk, we agreed to pay to Mr. Stadnyk a monthly salary of $4,000 commencing April 1, 2003 and ending March 31, 2006, representing an annual salary of $48,000 for a three year term  Pursuant to the terms of this agreement we may satisfy our obligations in respect of payment of the salary to Mr. Stadnyk in any month during the term of the agreement by the issuance of such number of shares of our common stock at a deemed price equal to the average bid price of our common stock on the OTC Bulletin Board for the last five trading days of such month as having a value equal to the salary then otherwise payable.  As at March 31, 2004, we had issued 321,280 shares of our common stock to Mr. Stadnyk in lieu of salary otherwise payable to him.

Pursuant to the Management Agreement dated April 1, 2003 with Winston Cabell, we agreed to pay to Mr. Cabell a monthly salary of $1,000 commencing April 1, 2003 and ending March 31, 2004, representing an annual salary of $12,000  Pursuant to the terms of this agreement we may satisfy our obligations in respect of payment of the salary to Mr. Cabell in any month during the term of the agreement by the issuance of such number of shares of our common stock at a deemed price equal to the average bid price of our common stock on the OTC Bulletin Board for the last five trading days of such month as having a value equal to the salary then otherwise payable.  As at March 31, 2004, we had issued 57,592 shares of our common stock to Mr. Cabell in lieu of salary otherwise payable to him.

Pursuant to the Management Agreement dated April 22, 2003 with Byron Cox, our company's Secretary and Treasurer, we agreed to pay to Mr. Cox a monthly salary of $1,000 commencing May 1, 2003 and ending April 30, 2004, representing an annual salary of $12,000.  Pursuant to the terms of this agreement we may satisfy our obligations in respect of payment of the salary to Mr. Cox in any month during the term of the agreement by the issuance of such number of shares of our common stock at a deemed price equal to the average bid price of our common stock on the OTC Bulletin Board for the last five trading days of such month as having a value equal to the salary then otherwise payable.  As at March 31, 2004, we had issued 80,319 shares of our common stock to Mr. Cox in lieu of salary otherwise payable to him.

On February 18, 2004 we entered into a letter agreement with Praxis Pharmaceuticals Inc. ("Praxis") wherein we agreed to be bound by the terms of the original Termination of License and Research and Development Agreement (the "License Agreement") dated February 28, 2001.  The letter agreement confirms that all amendments to such License Agreement are no longer in force and effect.  As a result, Praxis will retain the common shares of Fairchild assigned to it under the terms of the License Agreement and Praxis will pay to us 30% of the Net Revenues in the License Agreement to a maximum of $250,000 over the first three years of sale; provided that we have received $59,423 from Praxis.

On February 24, 2004 we granted incentive stock options to purchase up to an aggregate of 2,100,000 shares of our common stock at a price of $0.03 per share, of which 900,000 are exercisable to February 24, 2005 and 1,200,000 are exercisable to February 24, 2009.

Results of Operations

Fiscal Quarter Ended March 31, 2004 Compared to Fiscal Quarter Ended March 31, 2003

We incurred a net loss of $59,734 from continuing operations for the three months ended March 31, 2004 compared to a net loss of $127,756 for the same quarter ending March 31, 2003.   The net loss from continuing operations is due primarily to costs associated with maintaining our existing oil and gas interests and actively seeking new oil and gas exploration opportunities.  We have generated a cumulative loss since inception of $2,250,604.  Due to our continued losses and lack of revenues there is substantial doubt about our ability to continue as a going concern.

Lack of Revenues

At this time, our ability to generate any revenues continues to be uncertain.  The auditor's report on our December 31, 2003 financial statements contains an additional explanatory paragraph that identifies issues that raise substantial doubt about our ability to continue as a going concern.  The financial statements do not include any adjustment that might result from the outcome of this uncertainty.

Expenses and Cash Requirements

Our expenses for the three month period ended March 31, 2004 were $70,532 compared to $160,812 for the same period ended March 31, 2003.  The decrease in expenses was primarily due to an decrease in consulting expenses.

We intend to continue to maintain our existing oil and gas interests and look at new opportunities in the oil and gas industry.  We will be primarily dependent upon proceeds from the sale of our securities for the near future.  We anticipate that we will require approximately $250,000 over the twelve months ending March 31, 2005 for general and administrative expenses and approximately a further $250,000 to fund our currently proposed oil and gas exploration activities.  Revenues received for our existing oil and gas interests will be applied towards our anticipated general and administrative expenses although there are no assurances that such revenues will continue to be received or be sufficient to cover our expenses.  To the extent that we participate in further oil and gas exploration activities or proceed with the development stage with respect to our current property interests, we will require additional funds.  There is no assurance that we will be able to obtain such additional funds on favourable terms, if at all.  Our inability to raise sufficient funds could cause us to lose the existing oil and gas interests and any work conducted and/or payments made on the properties and could preclude us from participating in other exploration opportunities.

Liquidity and Capital Resources

These financial statements have been prepared on the basis of a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  Our company has suffered recurring losses and has not generated profitable operations since inception.  The continuance of our company as a going concern is dependent on obtaining financing from third parties.

We are currently relying on our existing cash reserves to fund our continuing operating expenses and to fund our interests in certain oil and gas exploration and development properties.  As of March 31, 2004 we had a net working capital deficiency of $39,592.  We would likely seek to secure any additional financing necessary through a private placement of our shares of common stock in order to fund our interests in certain oil and gas exploration and development properties.

Research and Development

We do not currently, and did not previously, have research and development policies in place.  We have not expended any material amounts on research or development of our oil and gas properties, except to the extent that the funds we expended to acquire our interest in the properties were spent in the development on the properties.

Purchase of Significant Equipment

We do not intend to purchase any significant equipment through March 31, 2005.

Employees

We do not anticipate an increase in the number of employees we retain over the twelve months ending March 31, 2005.  Such an increase on the number of employees may significantly increase our monthly burn rate and such increase in the monthly burn rate depends on the number of employees we ultimately retain, if any.

New Accounting Pronouncements

In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated with Exit or Disposal Activities" ("SFAS 146"). This Statement addresses financial accounting and reporting for costs associated with exit or disposal activities and nullifies Emerging Issues Task Force ("EITF") Issue No. 94-3, "Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring)." This Statement requires that a liability for costs associated with an exit or disposal activity be recognized and measured initially at fair value only when the liability is incurred. This pronouncement is effective for exit or disposal activities that are initiated after December 31, 2002.

In December 2002, the FASB issued Statement of Financial Accounting Standards ("SFAS") No. 148, "Accounting for Stock-Based Compensation, Transition and Disclosure." SFAS No. 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. SFAS No. 148 also requires that disclosures of the pro forma effect of using the fair value method of accounting for stock-based employee compensation be displayed more prominently and in a tabular format. Additionally, SFAS No. 148 requires disclosure of the pro-forma effect in interim financial statements. The transition and annual disclosure requirements of SFAS No. 148 are effective for fiscal years ended after December 15, 2002. The interim disclosure requirements are effective for interim periods beginning after December 15, 2002. The Company believes that the adoption of this standard will have no material impact on its financial statements.

In November 2002, the FASB issued Interpretation No. 45 (FIN 45), Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others. The Interpretation expands on the accounting guidance of FAS 5, Accounting for Contingencies, FAS 57, Related Party Disclosures, and FAS 107, Disclosures about Fair Value of Financial Instruments, and incorporates without change the provisions of FIN 34, Disclosure of Indirect Guarantees of Indebtedness of Others, an interpretation of FASB Statement No. 5, which is being superseded. FIN 45 elaborates on the existing disclosure requirements for most guarantees, including loan guarantees, such as standby letters of credit. It also clarifies that at the time a company issues a guarantee, the company must recognize an initial liability for the fair value, or market value, of the obligations it assumes under that guarantee and must disclose that information in its interim and annual financial statements. FIN 45 will be effective to the Company on a prospective basis to guarantees issued or modified after December 31, 2002. The Company believes that the adoption of this standard will have no material impact on its financial statements.

In January 2003, the Financial Accounting Standards Board issued FASB Interpretation No. 46, Consolidation of Variable Interest Entities ("FIN 46"). Under that interpretation, certain entities known as "Variable Interest Entities" ("VIE") must be consolidated by the "primary beneficiary" of the entity. The primary beneficiary is generally defined as having the majority of the risks and rewards arising from the VIE. For VIE's in which a significant (but not majority) variable interest is held, certain disclosures are required. FIN 46 requires disclosure of Variable Interest Entities in financial statements issued after January 31, 2003, if it is reasonably possible that as of the transition date: (1) the Company will be the primary beneficiary of an existing VIE that will require consolidation or, (2) the Company will hold a significant variable interest in, or have significant involvement with, an existing VIE. Any VIEs created after January 31, 2003, are immediately subject to the consolidation guidance in FIN 46. The measurement principles of this interpretation will be effective for the Company's 2003 financial statements. The Company does not have any entities that require disclosure or new consolidation as a result of adopting the provisions of FIN 46.

In November 2002, the "EITF" reached a consensus on EITF 00-21, "Accounting for Revenue Arrangements with Multiple Deliverables." EITF 00-21 establishes criteria for whether revenue on a deliverable can be recognized separately from other deliverables in a multiple deliverable arrangement. The criteria consider whether the delivered item has stand-alone value to the customer, whether the fair value of the delivered item can be reliably determined and the rights of returns for the delivered item. EITF 00-21 is effective for revenue agreements entered into in fiscal years beginning after June 15, 2003 with early adoption permitted. The Company believes that the adoption of this standard will have no material impact on its financial statements.

In May 2003, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standard (SFAS) No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity". SFAS No. 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. It requires that an issuer classify a financial instrument that is within its scope as a liability (or an asset in some circumstances). The requirements of SFAS No. 150 apply to issuers' classification and measurement of freestanding financial instruments, including those that comprise more than one option or forward contract. SFAS No. 150 does not apply to features that are embedded in a financial instrument that is not a derivative in its entirety. SFAS No. 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003, except for mandatorily redeemable financial instruments of non-public entities. It is to be implemented by reporting the cumulative effect of a change in an accounting principle for financial instruments created before the issuance date of SFAS No. 150 and still existing at the beginning of the interim period of adoption. Restatement is not permitted. The adoption of this standard is not expected to have a material effect on the Company's results of operations or financial position.

RISK FACTORS

Much of the information included in this quarterly report includes or is based upon estimates, projections or other "forward looking statements".  Such forward looking statements include any projections or estimates made by us and our management in connection with our business operations.  While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgement regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein.

Such estimates, projections or other "forward looking statements" involve various risks and uncertainties as outlined below.  We caution the reader that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other "forward looking statements".

Our shares of common stock are considered speculative while we proceed with our commitments under the Farmout Agreement and the Participation Agreements or while we continue our search for new business opportunities.  Prospective investors should consider carefully the risk factors set out below.

Limited Operating History and History of Losses

We have a limited oil and gas operating history and therefore have a limited history of earnings. We started our oil and gas operations with the acquisition of our interest in our current properties.  To date, we have incurred substantial net losses.  As of March 31, 2004, we had a cumulative deficit of $2,250,604.  Our ability to generate significant revenues is uncertain.  In order for us to make a profit, our revenues will need to increase significantly.

Lack of Financial Resources

Our ability to continue exploration and, if warranted, development of our properties will be dependent upon our ability to raise significant additional financing. If we are unable to obtain such financing, a portion of our interest in our properties may be lost to exploration partners or our properties may be lost entirely.  We have limited financial resources and limited cash flow from operations and we are dependent for funds on our ability to sell our common shares, primarily on a private placement basis.  There can be no assurance that we will be able to obtain financing on that basis in light of factors such as the market demand for our securities, the state of financial markets generally and other relevant factors.  The method of financing employed by us to date results in increased dilution to the existing shareholders each time a private placement is conducted.

There can be no assurance that additional funding will be available to us for exploration and development of our projects or to fulfil our obligations under any applicable agreements.  Although historically we have announced additional financings to proceed with the development of some of our previous properties, there can be no assurance that we will be able to obtain adequate financing in the future or that the terms of such financing will be favourable.  Failure to obtain such additional financing could result in delay or indefinite postponement of further exploration and development of our projects with the possible loss of such properties.

Going Concern Qualification

There is substantial doubt about our ability to continue as a going concern due to the losses incurred since inception, our stockholders' deficiency, and lack of revenues.

We anticipate that we may require financing from unrelated third parties in order to continue seeking a suitable business opportunity or business combination.  We anticipate that we will have sufficient capital to fund our ongoing operations until that time.  However, we may be required to raise additional financing for a particular business combination or business opportunity.  We would likely seek to secure any additional financing necessary through private placements of our common stock.

There can be no assurance that, if required, any such financing will be available upon terms and conditions acceptable to us, if at all.  Our inability to obtain additional financing in a sufficient amount when needed and upon terms and conditions acceptable to us could have a materially adverse effect upon our company.  Although we believe that we have funds sufficient to meet our immediate needs, we may require further funds to finance the development of any business opportunity that we acquire.  There can be no assurance that such funds will be available or available on terms satisfactory to us.  If additional funds are raised by issuing equity securities, further dilution to existing or future shareholders is likely to result.  If adequate funds are not available on acceptable terms when needed, we may be required to delay, scale back or eliminate the development of any business opportunity that we acquire.  Inadequate funding could also impair our ability to compete in the marketplace, which may result in the dissolution of our company.

Property Defects

We have not obtained title reports with respect to our oil and gas properties and believe our interests are valid and enforceable.  The properties may be subject to prior unregistered agreements, native land claims or transfers which have not been recorded or detected through title research.  Additionally, the land upon which we hold oil and gas leases may not have been surveyed; therefore, the precise area and location of such interests may be subject to challenge.

Currency Fluctuations

We maintain our accounts in US and Canadian currencies and are therefore subject to currency fluctuations and such fluctuations may materially affect our financial position and results. We do not engage in currency hedging activities.

Need to Manage Growth

In the event our properties commence production, we could experience rapid growth in revenues, personnel, complexity of administration and in other areas.  There can be no assurance that we will be able to manage the significant strains that future growth may place on our administrative infrastructure, systems, and controls.  If we are unable to manage future growth effectively, our business, operating results and financial condition may be materially adversely affected.

Dependence on Key Personnel/Employees

We are dependent on our ability to hire and retain highly skilled and qualified personnel. We face competition for qualified personnel from numerous industry sources, and there can be no assurance that we will be able to attract and retain qualified personnel on acceptable terms. We do not have key man insurance on any of our employees. The loss of service of any of our key personnel could have a material adverse effect on our operations or financial condition.

Dependence on Operators

Under the Farmout Agreement with Olympic Resources (Arizona) Ltd. and the operating agreement referred to therein, Lario Oil & Gas Co. will act as operator for the purposes of carrying out the work necessary to ensure our right to earn an interest under the Farmout Agreement and we are therefore dependent upon Lario's expertise in the area of oil and gas exploration and development.

Under the Participation Agreements with Patch, True Energy Inc. will act as operator for the purposes of carrying out the work necessary to ensure our right to earn an interest under the Participation Agreements and we are therefore dependent upon True Energy's expertise in the area of oil and gas exploration and development.

Under a participation agreement with Patch, PB will act as operator for the purposes of carrying out the work necessary to ensure our right to earn an interest under the participation agreement and we are therefore dependent upon PB's expertise in the area of oil and gas exploration and development.

Conflicts of Interest

In addition to their interest in our company, our management currently engages, and intends to engage in the future, in the oil and gas business independently of our company. As a result, conflicts of interest between us and management of our company might arise.

"Penny Stock" Rules May Restrict the Market for the Company's Shares

Our shares of common stock are subject to rules promulgated by the Securities and Exchange Commission relating to "penny stocks," which apply to companies whose shares are not traded on a national stock exchange or on the NASDAQ system, trade at less than $5.00 per share, or who do not meet certain other financial requirements specified by the Securities and Exchange Commission.  These rules require brokers who sell "penny stocks" to persons other than established customers and "accredited investors" to complete certain documentation, make suitability inquiries of investors, and provide investors with certain information concerning the risks of trading in the such penny stocks.  These rules may discourage or restrict the ability of brokers to sell our shares of common stock and may affect the secondary market for our shares of common stock.  These rules could also hamper our ability to raise funds in the primary market for our shares of common stock.

Possible Volatility of Share Prices

Our shares of common stock are currently publicly traded on the Over-the-Counter Bulletin Board service of the National Association of Securities Dealers, Inc.  The trading price of our shares of common stock has been subject to wide fluctuations.  Trading prices of our shares of common stock may fluctuate in response to a number of factors, many of which will be beyond our control.  The stock market has generally experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with no current business operation.  There can be no assurance that trading prices and price earnings ratios previously experienced by our shares of common stock will be matched or maintained.  These broad market and industry factors may adversely affect the market price of our shares of common stock, regardless of our operating performance.

In the past, following periods of volatility in the market price of a company's securities, securities class-action litigation has often been instituted.  Such litigation, if instituted, could result in substantial costs for us and a diversion of management's attention and resources.

Indemnification of Directors, Officers and Others

Our by-laws contain provisions with respect to the indemnification of our officers and directors against all expenses (including, without limitation, attorneys' fees, judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding arising by reason of the fact that the person is one of our officers or directors) incurred by an officer or director in defending any such proceeding to the maximum extent permitted by Nevada law.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of our company under Nevada law or otherwise, we have been advised the opinion of the Securities and Exchange Commission is that such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable.

Future Dilution

Our constating documents authorize the issuance of 50,000,000 shares of common stock, each with a par value of $0.001 and 1,000,000 shares of preferred stock, par value $0.01.  In the event that we are required to issue any additional shares or enter into private placements to raise financing through the sale of equity securities, investors' interests in our company will be diluted and investors may suffer dilution in their net book value per share depending on the price at which such securities are sold.  If we issue any such additional shares, such issuances also will cause a reduction in the proportionate ownership and voting power of all other shareholders.  Further, any such issuance may result in a change in our control.

Anti-Takeover Provisions

We do not currently have a shareholder rights plan or any anti-takeover provisions in our By-laws.  Without any anti-takeover provisions, there is no deterrent for a take-over of our company, which may result in a change in our management and directors.

Risks Relating to the Industry

Oil and Gas Exploration

Exploration for economic reserves of oil and gas is subject to a number of risk factors.  While the rewards to an investor can be substantial if an economically viable discovery is made, few of the properties that are explored are ultimately developed into producing oil and/or gas wells.

Potential Profitability of Oil and Gas Ventures Depends Upon Factors Beyond the Control of Our Company

The potential profitability of oil and gas properties is dependent upon many factors beyond our control.  For instance, world prices and markets for oil and gas are unpredictable, highly volatile, potentially subject to governmental fixing, pegging, controls, or any combination of these and other factors, and respond to changes in domestic, international, political, social, and economic environments.  Additionally, due to worldwide economic uncertainty, the availability and cost of funds for production and other expenses have become increasingly difficult, if not impossible, to project.  These changes and events may materially affect our financial performance.

Adverse weather conditions can also hinder drilling operations.  A productive well may become uneconomic in the event water or other deleterious substances are encountered which impair or prevent the production of oil and/or gas from the well.  In addition, production from any well may be unmarketable if it is impregnated with water or other deleterious substances.  The marketability of oil and gas which may be acquired or discovered will be affected by numerous factors beyond our control.  These factors include the proximity and capacity of oil and gas pipelines and processing equipment, market fluctuations of prices, taxes, royalties, land tenure, allowable production and environmental protection.  The extent of these factors cannot be accurately predicted but the combination of these factors may result in our company not receiving an adequate return on invested capital.

Competitiveness of Oil and Gas Industry

The oil and gas industry is intensely competitive. We compete with numerous individuals and companies, including many major oil and gas companies, which have substantially greater technical, financial and operational resources and staffs.  Accordingly, there is a high degree of competition for desirable oil and gas leases, suitable properties for drilling operations and necessary drilling equipment, as well as for access to funds.  There can be no assurance that the necessary funds can be raised or that any projected work will be completed.

Fluctuating Price and Demand

The marketability of natural resources which may be acquired or discovered by us will be affected by numerous factors beyond our control.  These factors include market fluctuations in oil and gas pricing and demand, the proximity and capacity of natural resource markets and processing equipment, governmental regulations, land tenure, land use, regulation concerning the importing and exporting of oil and gas and environmental protection regulations.  The exact effect of these factors cannot be accurately predicted, but the combination of these factors may result in us not receiving an adequate return on invested capital to be profitable or viable.

Comprehensive Regulation of Oil and Gas Industry

Oil and gas operations are subject to federal, state, and local laws relating to the protection of the environment, including laws regulating removal of natural resources from the ground and the discharge of materials into the environment.  Oil and gas operations are also subject to federal, state, and local laws and regulations which seek to maintain health and safety standards by regulating the design and use of drilling methods and equipment.  Various permits from government bodies are required for drilling operations to be conducted; no assurance can be given that such permits will be received.  No assurance can be given that environmental standards imposed by federal, provincial, or local authorities will not be changed or that any such changes would not have material adverse effects on our activities.  Moreover, compliance with such laws may cause substantial delays or require capital outlays in excess of those anticipated, thus causing an adverse effect on us.  Additionally, we may be subject to liability for pollution or other environmental damages which it may elect not to insure against due to prohibitive premium costs and other reasons.

Environmental Regulations

In general, our exploration and production activities are subject to certain federal, state and local laws and regulations relating to environmental quality and pollution control.  Such laws and regulations increase the costs of these activities and may prevent or delay the commencement or continuance of a given operation.  Compliance with these laws and regulations has not had a material effect on our operations or financial condition to date.  Specifically, we are subject to legislation regarding emissions into the environment, water discharges and storage and disposition of hazardous wastes.  In addition, legislation has been enacted which requires well and facility sites to be abandoned and reclaimed to the satisfaction of state authorities.  However, such laws and regulations are frequently changed and we are unable to predict the ultimate cost of compliance.  Generally, environmental requirements do not appear to affect us any differently or to any greater or lesser extent than other companies in the industry.

We believe that our operations comply, in all material respects, with all applicable environmental regulations.

Our operating partners maintain insurance coverage customary to the industry; however, it is not fully insured against all environmental risks.

Risks Associated with Drilling

Drilling operations generally involve a high degree of risk.  Hazards such as unusual or unexpected geological formations, power outages, labor disruptions, blow-outs, sour gas leakage, fire, inability to obtain suitable or adequate machinery, equipment or labour, and other risks are involved. We may become subject to liability for pollution or hazards against which it cannot adequately insure or which it may elect not to insure.  Incurring any such liability may have a material adverse effect on our financial position and operations.

Government Regulation/Administrative Practices

There is no assurance that the laws, regulations, policies or current administrative practices of any government body, organization or regulatory agency in the United States or any other jurisdiction, will not be changed, applied or interpreted in a manner which will fundamentally alter the ability of our company to carry on our business.

The actions, policies or regulations, or changes thereto, of any government body or regulatory agency, or other special interest groups, may have a detrimental effect on our Company.  Any or all of these situations may have a negative impact on our ability to operate and/or become profitable.

Item 3.	Controls and Procedures

As required by Rule 13a-15 under the Exchange Act, within the 90 days prior to the filing date of this report, our Company carried out an evaluation of the effectiveness of the design and operation of our Company's disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our Company's management, including our Company's President, Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, our Company's President, Chief Executive Officer and Chief Financial Officer concluded that our Company's disclosure controls and procedures are effective. There have been no significant changes in our Company's internal controls or in other factors, which could significantly affect internal controls subsequent to the date our Company carried out its evaluation.



Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in Company reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in Company reports filed under the Exchange Act is accumulated and communicated to management, including the Company's Chief Executive Officer and Chief Financial Officer as appropriate, to allow timely decisions regarding required disclosure.

Part II - OTHER INFORMATION

Item 1.	Legal Proceedings.

We know of no material, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 2.	Changes in Securities.

Recent Sales of Unregistered Securities

None.

Item 3.	Defaults Upon Senior Securities.

None.

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

None.

Item 5.	Other Information.

None.

Item 6.	Exhibits and Reports on Form 8-K.

Form 8-K Current Reports

On February 27, 2004, we filed a Current Report on Form 8K announcing that we entered into a letter agreement dated February 18, 2004 with Praxis Pharmaceuticals Inc. ("Praxis") wherein we agreed to be bound by the terms of the original Termination of License and Research and Development Agreement (the "License Agreement") dated February 28, 2001.  The letter agreement confirms that all amendments to such License Agreement are no longer in force and effect.  As a result, Praxis will retain the common shares of Fairchild assigned to it under the terms of the License Agreement and Praxis will pay to us 30% of the Net Revenues in the License Agreement to a maximum of $250,000 over the first three years of sale; provided that we have received $59,423 from Praxis.

Financial Statements Filed as Part of the Quarterly Report

Our financial statements include:

Balance Sheets

Statements of Operations and Deficit

Statements of Cash Flows

Notes to the Financial Statements

Exhibits Required by Item 601 of Regulation S-B

Exhibit Number and Description

(3)	Articles of Incorporation/Bylaws

3.1	Articles of Incorporation (incorporated by reference from our Registration Statement on Form 10-SB filed on November 30, 1999)

3.2	Bylaws (incorporated by reference from our Registration Statement on Form 10-SB filed on November 30, 1999)

(10)	Material Contracts

10.1	Assignment Agreement dated February 23, 2004 between Fairchild International Corporation and Habanero Resources Inc. (incorporated by reference from our Annual Report on Form 10-KSB filed on April 16, 2004)

10.2	Assignment Agreement dated February 23, 2004 between Fairchild International Corporation and Micron Enviro Systems Inc. (incorporated by reference from our Annual Report on Form 10-KSB filed on April 16, 2004)

(31)	Certifications

31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(32)	Certifications

32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002







SIGNATURES

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

FAIRCHILD INTERNATIONAL CORPORATION

/s/ George Tsafalas
By:___________________________
George Tsafalas, President and Director
May 19, 2004

/s/ Byron Cox
By:___________________________
Byron Cox, Secretary, Treasurer and
Director
May 19, 2004

/s/ John Thornton
By:___________________________
John Thornton, Director
May 19, 2004