UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549




Form 10-K





(Mark
One)


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


For the
fiscal year ended December 31, 2008




or




 ̈TRANSITION REPORT UNDER SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the
transition period from __________________ to
__________________________




ODYSSEY
OIL & ENERGY, INC.




(Name
of registrant as specified in its charter)




Florida
              333-106299
              65-1139235(State or other jurisdiction of
                incorporation or organization)
              (Commission file number)
              (I.R.S. Employer
                Identification No.)


18 George
Avenue


Rivonia,
2128 South Africa


(Address
of principal executive offices) (Zip Code)




Registrant's
telephone number, including area code: +27
(11)  807-1446




Securities
registered under Section 12(b) of the Act:





None





Securities
registered under Section 12(g) of the Act:




Common
Stock, par value $ 0.0001 per share


(Title
of class)




Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.  ̈ Yes þ No




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.  ̈ Yes þ No




Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes þ  No  ̈


1




Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. þ




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





Large
      accelerated filer
               ̈
              Accelerated
      filer
               ̈Non-accelerated
      filer
                (Do
      not check if a smaller reporting company)
               ̈
              Smaller
      reporting company
              þ


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





State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold, or the average bid and asked prices of such common equity, as of the last
business day of the registrant's most recently completed second fiscal
quarter.




As of
March 23, 2009, the aggregate market value of the voting stock held by
non-affiliates of the registrant based on a value of $0.52 per share on March
23, 2009 was $74,746,100.




Indicate
the number of shares outstanding of each of the registrant's classes of common
stock, as of the latest practicable date. 143,742,500 shares of common stock are
issued and outstanding as of March 23, 2009.


2




TABLE
OF CONTENTS




PART
      IITEM
      1
                        DESCRIPTION
      OF BUSINESS
                        
                        4ITEM
      2
                        DESCRIPTION
      OF PROPERTIES
                        
                        9ITEM
      3
                        LEGAL
      PROCEEDINGS
                        
                        9ITEM
      4
                        SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY HOLDERS
                        
                        9PART
      IIITEM
      5
                        MARKET
      FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
                        
                        9ITEM
      6
                        SELECTED
      FINANCIAL DATA
                        
                        10ITEM
      7
                        MANAGEMENT’S
      DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
                        
                        10ITEM
      8
                        FINANCIAL
      STATEMENTS
                        
                        14ITEM
      9
                        CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTINGAND
      FINANCIAL DISCLOSURES
                        
                        15ITEM
      9A
                        CONTROLS
      AND PROCEDURES
                        
                        15PART
      IIIITEM
      10
                        DIRECTORS,
      EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;COMPLIANCE
      WITH SECTION 16(A) OF THE EXCHANGE ACT
                        
                        16ITEM
      11
                        EXECUTIVE
      COMPENSATION
                        
                        18ITEM
      12
                        SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS ANDMANAGEMENT
      AND RELATED STOCKHOLDER MATTERS
                        
                        18ITEM
      13
                        CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORINDEPENDENCE
                        
                        20ITEM
      14
                        PRINCIPAL
      ACCOUNTANT FEES AND SERVICES
                        
                        21SIGNATURES


3




ITEM
1 DESCRIPTION OF BUSINESS




Overview
of the Company and its Prior Strategy




Advanced
Sports Technologies, Inc. (AST) was incorporated in the state of Florida on
August 9, 2001.




The
Company's initial efforts were focused on developing and marketing
premium-quality, premium-priced, branded fitness and exercise equipment to the
home fitness equipment market. Our original business plan included marketing
products directly to consumers through a variety of direct marketing channels,
including spot television commercials, infomercials, print media, direct
response mailings and the Internet. Initial consumers targeted for the Company's
efforts included health clubs and gyms, rehabilitation clinics, hospitals,
colleges and universities, hotels and motels and the military and governmental
agencies.




AST
licensed the rights to a portable gym subject to patent protection in the United
States, which may be marketed under the trademark Better Buns. It was the
Company's intention for this product to be its first direct-marketed product,
although the Company was unsuccessful in its attempts to raise funding for
marketing. All patents, trademarks and other intellectual property associated
with the Better Buns product are owned by, and the Company's license agreement
was with, Exerciting LLC, which is owned by the brothers of the Company's former
President and sole director. Prior to the Merger (as defined below and discussed
herein), the Company was searching for other products to license or acquire for
introduction. AST has not generated any revenues through the sale of the Better
Buns product or otherwise and has not engaged in any research and development or
marketing activities due to limited funds and resources.




In May
2005, the Company received notice that it was in breach of its license agreement
with Exerciting, LLC for the Better Buns product and that the license was being
terminated.




The
Merger




On
September 23, 2005, the Company changed focus through a merger with
CardioBioMedical Corporation. We created a wholly owned Delaware subsidiary for
the purpose of merging with CBM, a Delaware corporation. With the consent of
shareholders holding over 95% of the shares of CBM entitled to vote, the Sub
merged with and into CBM with CBM being the surviving corporation. CBM then
became a subsidiary of the Company and the separate existence of Sub
ceased.




The
consideration for the Merger consisted of 22,077,509 shares of AST common stock,
$.0001 par value, payable to the shareholders of CBM and a warrant, exercisable
beginning January 1, 2008, to purchase 6,500,000 shares of AST common stock at a
purchase price of $.01 per share payable to the sole warrant holder of CBM. At
the effective time of the Merger and without any action on the part of CBM
stockholders, each one share of CBM common stock (except for shares held in
treasury and dissenting shares) was converted into the right to receive one
share of common stock of the Company, and the CBM warrant referenced above was
exchanged for an equivalent AST warrant.




Further
in connection with the Merger, the Board of Directors accepted the resignation
of Curtis Olschansky as sole director and officer of the Company and elected
James F. Mongiardo to fill the vacancy on the Board. Mr. Mongiardo was also
elected to serve as Chief Executive Officer and President of AST.




CBM was
formed in May 2003 to commercialize, in licensed territories, devices
incorporating proprietary and patented technology relating to a new scientific
technique applying bio-cybernetic principles and frequency analysis in
non-invasive medical devices. CBM currently is a party to a non-exclusive
license from a patent holder to sell a proprietary device in designated
territories and has a commitment from such patent-holder to perform consulting
services for CBM at its request.


4




The
Medical Problem




According
to the American Heart Association's latest cardiovascular disease statistics
(estimates for 2002), cardiovascular disease is the number one killer in the
United States. Cardiovascular dysfunction, especially atherosclerosis (hardening
of the arteries) and its manifestations, debilitates nearly 13 million Americans
and annually causes approximately 900,000 deaths in the United States. The main
cause of cardiac death is acute myocardial infarction. Myocardial infarction
refers to the injury or death of heart muscle and tissue because of interrupted
blood flow to the area, typically as a result of atherosclerosis. An acute
myocardial infarction will occur in 1.2 million people in the United States each
year, 500,000 of whom will die during this acute event. Among those who
experience sudden cardiac death, coronary artery disease ("CAD") is the main
cause of death. A very important risk factor is "silent" ischemia (or restricted
blood flow), i.e. the asymptomatic form of CAD.




In 1903,
Willem Einthoven devised the string galvanometer to indicate and graphically
record changes of electric potential at various points on the exterior surface
of the human body caused by contractions of the myocardium or heart muscle. His
invention became the electrocardiogram ("ECG"). ECG devices measure the
electrical impulses generated by the myocardial cells. The standard ECG test
records the positive and negative electrical waves resulting from each
heartbeat. This means that a standard ECG study examines the electrical output
in the time domain, i.e., a one-dimensional examination. This can limit the
amount of data generated and, accordingly, the diagnostic value of the device.
While the standard ECG is not invasive, it is also of low accuracy (50-55% for
CAD) and is insensitive to ischemia according to the Yale University School of
Medicine Heart Book.




In order
for a physician to get a more accurate understanding of the coronary risk
associated with a patient, more expensive, complicated and riskier diagnostic
procedures are available. If CAD can be detected at an early stage, there exist
multiple treatment regimens that may effectively treat CAD.




The
Product




As noted
above, CBM has a non-exclusive license to market a proprietary medical device
designed for the non-invasive early diagnosis of coronary artery diseases,
particularly myocardial injury caused by ischemia, in the United States, Canada
and Mexico. The product, known as the Cardio Spectrum Diagnostic System ("CSD"),
has received approval under Underwriters Laboratories, Inc.'s electrical safety
standards (UL-2601), the European Union's standard for marketing a medical
device (CE) and the Federal Communication Commission's standards for marketing a
computer. In addition, CBM received 510(k) clearance from the U.S. Food and Drug
Administration to market the CSD in the United States.




The basic
concept underlying the proprietary technology incorporated in the CSD is the
recognition that time domain myocardial electrical signals can be transformed
into frequency domain and then analyzed. This concept is easily understood
through the example of sunshine. To the naked eye, sunshine appears to be white.
Scientists, however, regard sunshine more precisely as a spectrum in which one
can see that the white comprises an infinite array of colors just like a
rainbow. Similarly, the electrical signals given by the ECG can be transformed
from the time domain into the frequency domain and then analyzed. It is our
contention that this frequency domain gives a more complete and accurate
assessment of the coronary disease status of a patient than other standard,
non-invasive coronary diagnostic procedures.


5


The CSD
is the culmination of 20 years of research and development. Included in its
software are over 20,000 patient test results. The procedure utilizing the
device is performed non- invasively while the patient is at rest, with the goal
of eliminating the risks associated with either exercise or the injection of
dyes or a catheter. After attaching the leads to the patient, the procedure is
completed in approximately 90 seconds. Results to date have shown that the CSD
is effective at non-invasively diagnosing CAD with more than 90% sensitivity and
specificity.




A
New Strategy




The
objective of the Company was to establish the CSD as the standard of care for
the detection of early-stage ischemic heart disease. Our strategy included first
establishing the system with cardiologists and then gaining acceptance and use
by other physician specialties and hospitals. We believed critical in U.S.
hospital market acceptance will be the cost savings of the CSD in both the early
detection of disease and the elimination of the need to perform multiple and
more expensive diagnostic procedures to determine a patient's cardiac
health.





Even
though the CSD may be marketed in the United States today, the Company believed
that the key to successful marketing here and elsewhere was the insurance
reimbursement. Historically, medical devices are not accepted by the medical
community or hospitals in any meaningful manner until there is associated
insurance reimbursement for use of the device. Therefore, one of the first
objectives of the Company was to obtain a "CPT Code" for the CSD. CPT codes
describe medical or psychiatric procedures performed by physicians and other
health-care providers. The codes were developed by HCFA (Health Care Financing
Administration, a government department that sets insurance reimbursement rates)
to assist in the assignment of reimbursement amounts to providers by Medicare
carriers. A growing number of managed care and other insurance companies,
however, base their reimbursements on the values established by
HCFA.





We
intended to seek a CPT code through a concentrated set of clinical trials that
was to begin with physicians associated with major teaching hospitals. The first
such trial was started at Cedars Sinai Medical Center in Los Angeles,
California. While clinical data was being generated to support a CPT code
application, we further intended to conduct additional clinical trials to "seed"
the market in the United States. We also expected that use of the CSD by
cardiologists at major teaching hospitals and other opinion leader locations
will have supported market introduction.




We
intended to sell the CSD to physicians including group practices, hospitals and
health maintenance organizations. We anticipated that marketing will focus on
its advantages, namely its sensitivity and specificity as a non-invasive
diagnostic tool to assist the physician in determining whether a patient has
CAD. We intended to use traditional vehicles to convey this message, including
medical journal advertising, direct mail and participation in medical meetings
and conferences. We also intended to market and sell the CSD through a hybrid
sales effort. In the United States, medical devices are sold through direct
sales forces, distributors or a combination of both. Because the CSD test
results include a suggested diagnosis, we believed that the CSD may have been
suitable for sale through distributors. To augment that effort and include key
account selling, e.g. hospital chains, we also anticipate hiring a small direct
sales force.





In
addition to a suggested diagnosis, the CSD test results gives the physician
additional diagnostic information about the coronary health of the patient. The
power spectrum, dual lead correlation and location results of the CSD test offer
an additional potential revenue source. We planned to offer physicians a service
to analyze this additional information to further assist the physician in
treating the patient.


6





Manufacturing
and Distribution





We
expected that the CSD would have been be supplied by its inventor, Professor Dan
Qun Fang. The product consists of commercially available hardware components and
proprietary software owned by Prof. Fang and licensed to CBM. Pursuant to the
license agreement for the CSD, CBM had the benefit of "most favored nation"
pricing, or pricing as favorable as that received by other sales
licensees/customers of the same products on comparable terms and
conditions.





Competition





The
market for medical devices is highly competitive and is served by a number of
well-established companies with recognized names. In order to effectively
compete, we would have been required to make substantial investments in sales
and marketing as well as research and development. Many products are sold by
companies with greater resources than the Company and there was no assurance
that we would have been successful in gaining significant market share for the
CSD or other products and product candidates or earning a return on our
investment in such products and product candidates.





Equipment
used by the physician as a diagnostic aid in determining whether a patient has
coronary artery disease includes electrocardiogram equipment, stress
electrocardiogram equipment, impedance cardiography equipment, echocardiogram
equipment, stress echocardiogram equipment, Thallium SPECT equipment, Ultra-Fast
CT Scan equipment, CT angiogram equipment, Pet Scan equipment and angiogram
equipment. In addition to competition from these devices and their respective
manufacturers, the Company believed that it would have had one primary direct
competitor, Premier Heart, which markets a two lead detection system known as
the 3DMPTsystem, as opposed to the 12 lead detection system used by the
CSD.




*
establish registration for device manufacturers (both domestic and foreign) and
importers,


* medical
device listing by firms that manufacture, re-package and re-label develop
specifications, reprocess single-use devices, remanufacture and/or manufacture
accessories and components sold directly to the end user,


* quality
system regulation, including requirements related to the methods used in and the
facilities and controls used for designing, purchasing, manufacturing,
packaging, labeling, storing, installing and servicing of medical
devices,


*
labeling requirements as well as descriptive and informational literature that
accompanies the device, and


* medical
device reporting to report incidents in which a device may have caused or
contributed to a death or serious injury.





As noted
above, the CSD system has received UL-2601, CE and FCC approval, and CBM has
received 510(k) clearance from the FDA to market the CSD in the United States.
We also intend to apply for a CPT Code for insurance reimbursement purposes.
Future products and product candidates will likely have to go through the pre
market notification or pre market approval process, and will be subject to the
applicable regulatory requirements discussed above. There can be no assurances
that approval would be granted for any future product or product candidate,
whether in the United States or elsewhere, on a timely basis or at all.
Furthermore, if approval is granted, the product or device would be subject to
continuing regulatory regulations and oversight. The approval process is
expensive and can take a long time to complete, and the cost involved in
satisfying applicable ongoing compliance requirements is high.


7


RESEARCH
AND DEVELOPMENT





The
Company did not invest in research and development for the Better Buns or any
other fitness product. Through December 31, 2007, CBM had invested $126,969 in
research and development activities for the CSD system. This amount has been
borne solely by CBM, and the Company does not expect in the near term to receive
external funding for research and development activities. These expenditures
have included retaining Averion, Inc., a clinical research organization, to
assist in the development of clinical protocols, monitoring of clinical trials
and analysis of data. CBM also pays for all expenses associated with its
clinical trials, including fees charged by the Institutional Review Board and a
fee per patient enrolled.




Our
New and Current Strategy




The
company was not having much success with CardioBioMedical Corporation and on
April 21, 2006, the ownership of CardioBioMedical Corporation was exchanged for
22,077,509 shares of Odyssey common stock with the original stockholders. In
addition, we changed the name of our company to Odyssey Oil & Energy, Inc to
reflect our new strategy.




On April
21, 2006, we began the realization of our new strategy by purchasing a 10%
working interest in oil and gas leases in Texas from Centurion Gold Holdings,
Inc., a related public company. We do not expect to purchase other working
interests in oil and gas wells in the future.




The
company will also explore investments in other energy related
enterprises.




On
November 21, 2007 we entered into a new phase of our strategy by acquiring a
Uranium Prospect known as Springbok Flats in the Bela Bela District of South
Africa. After numerous months of due diligence and some geological work on
samples provided to us, it was determined that it would not be viable to exploit
the Uranium deposit. The Board of directors has decided to consult with our
partners in the Uranium Prospect to dispose of the Prospect.




On
January 15, 2008, the Company’s well operator determined that the Leslie 1 Well
of BBB Area, Wharton Texas, was no longer commercially viable and the well was
plugged and abandoned.




On June
16, 2008, the Company acquired ALG Bio Oils Limited, which in turn owns 100% of
ALG Western Oils (Pty) Ltd. ALG Western Oils has the technology to make bio fuel
from algae and has entered into a Letter of Intent with Xstrata Alloys to begin
a bio fuel project at the Boshoek smelter in South Africa. This acquisition
continues the Company’s strategy of investing in energy related
enterprises.




The
Company intends to expand the making of bio fuels from algae to other large
mining Companies in South Africa.




EMPLOYEES




The
Company currently employs Arthur Johnson as its president and Nicolaas
Theunissen as its vice-president. No compensation or benefits is currently being
paid. These individuals are also directors.


8




ITEM
2. DESCRIPTION OF PROPERTY




Our
principal office facility is presently located in space owned by our president.
During 2008, the Company recorded additional paid-in capital of $12,000 for
the fair value of rent and services contributed to the Company by its
president.




ITEM
3. LEGAL PROCEEDINGS




We are
not party to any legal proceedings as of the date of this Form 10
K.




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




None.




PART
II.




ITEM
5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS
ISSUER PURCHASES OF EQUITY SECURITIES




Our
common stock was approved for an unpriced quotation on the Over the Counter
Bulletin Board on October 19, 2004.




As of
March 23, 2009, there were 45 shareholders of record of our common stock and a
total of 143,742,500 common shares outstanding.




We have
never paid any dividends and do not currently anticipate paying dividends in the
future. Any payment of cash dividends in the future will be dependent upon the
amount of funds legally available, our earnings, financial condition, capital
requirements and other factors that our Board of Directors may think are
relevant.




On May 1,
2008 the Company forward split the common shares of the Company on a basis of 3
shares for every 1 share held. As a result of the stock split, all share and per
share data have been retroactively adjusted to give effect to the stock
split.




There are
currently no outstanding options or warrants to purchase, or any securities that
are convertible into, our common stock. The single warrant to purchase 6,500,000
shares issued in connection with the CBM Merger was cancelled upon exchange of
ownership in CBM with the original stockholders.


9




ITEM
6. SELECTED FINANCIAL DATA




Statements
of Operations Information




Year ended
                    Dec. 31, 2008
                  
                  
                  Year Ended
                    Dec. 31, 2007
                  
                  
                  For the Period
                    May 28, 2003
                    (Inception) to
                    Dec. 31, 2008Revenue
                  
                  $
                  -
                  
                  
                  $
                  7,450
                  
                  
                  $
                  26,695Loss
      from continuing operations
                  
                  
                  (22,111,044
                  )
                  
                  
                  (4,635,418
                  )
                  
                  
                  (26,870,854
                  )Loss
      from discontinued operations
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (4,026,761
                  )Loss
      from operations before income taxes
                  
                  
                  (22,111,044
                  )
                  
                  
                  (4,635,418
                  )
                  
                  
                  (26,913,398
                  )Net
      loss
                  
                  
                  (22,111,044
                  )
                  
                  
                  (4,635,418
                  )
                  
                  
                  (30,940,159
                  )Net
      loss per share basic and diluted:Continuing
      operations
                  
                  $
                  (.17
                  )
                  
                  $
                  (.15
                  )Total
                  
                  $
                  (.17
                  )
                  
                  $
                  (.15
                  )Weighted
      average number of shares outstanding during the period-basic and
      diluted
                  
                  
                  127,590,860
                  
                  
                  
                  94,977,432




Balance
Sheets Information




Dec. 31, 2008
                                            
                                            
                                            Dec. 31, 2007Cash
                                            
                                            $
                                            1,196
                                            
                                            
                                            $
                                            450Total
      Assets
                                            
                                            
                                            2,196
                                            
                                            
                                            
                                            450Current
      Liabilities
                                            
                                            
                                            642,703
                                            
                                            
                                            
                                            295,983Total
      Liabilities
                                            
                                            
                                            642,703
                                            
                                            
                                            
                                            295,983Stockholders
      Equity (Deficiency)
                                            
                                            
                                            (323,643
                                            )
                                            
                                            
                                            (
      295,533
                                            )




ITEM
7. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION




Certain
statements contained in this discussion and analysis or incorporated herein by
reference that are not related to historical results are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Statements that are predictive, that depend upon or refer to future
events or conditions, and/or that include words such as "expects,"
"anticipates," "intends," "plans," "believes," "estimates," "hopes," and similar
expressions constitute forward-looking statements. In addition, any statements
concerning future financial performance (including future revenues, earnings or
growth rates), business strategies or prospects, or possible future actions by
us are also forward-looking statements.




These
forward-looking statements are based on beliefs of our management as well as
current expectations, projections, assumptions and information currently
available to the Company and are subject to certain risks and uncertainties that
could cause actual results to differ materially from historical results or those
anticipated or implied by such forward-looking statements. Should one or more of
those risks or uncertainties materialize or should underlying expectations,
projections and assumptions prove incorrect, actual results may vary materially
from those described. Those events and uncertainties are difficult to predict
accurately and many are beyond our control. We assume no obligation to update
these forward-looking statements to reflect events or circumstances that occur
after the date of these statements except as specifically required by law.
Accordingly, past results and trends should not be used to anticipate future
results or trends.


10




OVERVIEW




AST was
formed in Florida in August 2001 with the plan of becoming a direct marketing
company that developed and marketed premium-quality, premium-priced, branded
fitness and exercise equipment to the home fitness equipment market. Our
original business plan included marketing products directly to consumers through
a variety of direct marketing channels.




As an
initial step, the Company licensed the rights to a portable gym subject to
patent protection in the United States, which may be marketed under the
trademark Better Buns. It was the Company's intention for this product to be its
first direct-marketed product. The Company was unsuccessful in its attempts to
raise funding to pursue this goal and, in May 2005, received notice that it was
in breach of its license agreement for the Better Buns product and that the
license was being terminated. Since inception to date, the Company had not
generated any revenues through the sale of the Better Buns product or otherwise,
and had not engaged in any research and development or marketing activities due
to limited funds and resources.




In
September 2005, the Company changed focus in connection with the Merger of a
wholly owned subsidiary of the Company and CardioBioMedical Corporation, a
Delaware corporation. The subsidiary merged with and into CBM, with CBM as the
surviving corporation and becoming a subsidiary of AST. The consideration for
the merger consisted of 22,077,509 shares of AST common stock, $.0001 par value,
payable on a one-for-one basis to the consenting shareholders of CBM and a
warrant, exercisable beginning January 1, 2008, to purchase 6,500,000 shares of
AST common stock at a purchase price of $.01 per share payable to the sole
warrant holder of CBM in exchange for an equivalent CBM warrant.





The new
objective of the Company was to establish a medical device, the Cardio Spectrum
Diagnostic System as the standard of care for the detection of early-stage
ischemic heart disease. The Company's strategy consisted of attempting to (i)
obtain insurance reimbursement for performance of the diagnostic test, (ii)
establish the device with cardiologists and finally (iii) gain acceptance and
use by other physician specialties
and hospitals. The Company was unsuccessful in its attempts to obtain insurance
reimbursement and marketing CSD.




On
November 21, 2007 our Board of Directors authorized the purchase (the
“Purchase”) of one hundred percent (100%) of a Uranium Prospect known as
Springbok Flats in the Bela Bela District of  South Africa. The rights
are being held through MCA Uranium One (Pty) Ltd, a 49% (forty nine percent)
owned subsidiary of Odyssey Oil & Energy, Inc. As a result of the
Purchase, the Company issued 15,000,000 shares of the Company’s common stock at
a purchase price of $0.28 per share. A further 10,000,000 shares of the
Company's common stock will be issued on receipt of the mining license and a
further 25,000,000 shares of the Company's common stock will be issued within a
period of 18 months upon proving up of the Uranium Reserves. However, no further
shares are being issued. Our Board of Directors has decided not to proceed with
the exploration and exploitation of the Uranium Prospect as it will not be
financially viable. Our Board is in consultation with our partners as to how
best dispose of this asset.




During
2007, the Leslie 1 Well of the BBB Area in Wharton Texas underwent various
repairs to try and get the gas to start flowing again. The worst possible
scenario occurred when it was discovered that the well had a split casing. All
the partners in the well decided to allow Ventum Energy, the wells operator, to
try and establish a gas pocket about half way up the well to trap the gas and
pump it out. None of the repairs worked out the gas pocket did not materialize.
On January 15, 2008 it was decided to close up the well and abandon
it.


11




On June
16, 2008, the Company acquired ALG Bio Oils Limited, which in turn owns 100% of
ALG Western Oils (Pty) Ltd. ALG Western Oils. As a result of the Purchase the
Company issued 35,000,000 shares of the Company’s common stock with a fair value
of $21,700,000.   The Company will issue an  additional
75,000,000  shares of the Company’s common stock contingent upon the
occurrence of future specific eventsthrough the
commissioning of the pilot plant at Boshoek. This acquisition continues the
Company’s strategy of investing in energy related enterprises.




The
Company intends to expand the making of bio fuels from algae to other large
mining Companies in South Africa.





Unlike
the year ended December 31, 2007, no revenue was earned from the oil and gas
lease during the year ended December 31, 2008 as the well was permanently
plugged and abandoned in January 2008.




Excluding
the impairment of the bio-fuels development contract relating to the acquisition
of ALG Bio Oils Limited and the impairment of investment in oil and gas leases,
total operating expenses increased to $438,537 from $130,042 for the year ended
December 31, 2008. The increase was primarily due to consulting fees of $367,500
relating to MCA Uranium One (Pty) Limited.





Total
current assets consist of cash of $1,196 and website costs of $1,000. Total
liabilities consist of accounts payable and accrued expenses of $327,208 and
amounts due to related parties totaling $315,495. Global Investment Group, Inc.
and various related parties of ALG Bio Oils Limited funded all operating costs
and will continue to do so. Management has received verbal assurances from these
related parties that such funding will continue as needed.




PLAN
OF OPERATIONS




During
December 2006 the well was shut down for some major repairs. Mud had leaked into
the well and reduced the gas flow significantly. The well was brought back
online and gas started to flow in February 2007. Our share of the repair costs
was $12,554. The well was again shut down soon after starting up again due to a
significant loss of pressure in the well. It was found that the casing had in
fact cracked and the only way to repair the well was either to re-drill the well
at an enormous cost or try and trap the gas in an anomaly half way up the well.
The latter was tried but also proved to be unsuccessful. Our share of the costs
was $14,238. In January 2008 it was decided to abandon the well.




On
November 21, 2007 the Company purchased a Uranium Prospect known as Springbok
Flats in the Bela Bela District, South Africa. The rights are being held through
the company MCA Uranium One (Pty) Ltd a 49% (forty nine percent) owned
subsidiary of Odyssey Oil & Energy, Inc




The
Company does not intend to commence prospecting and proving up the reserves of
Uranium during 2009. The Company has decided not to proceed with the exploration
and exploitation of the Uranium Prospect as it will not be financially viable.
Our Board is in consultation with our partners as to how best dispose of this
asset.




The
company does not intend to expand by acquiring additional working interests in
other oil and gas wells.


12




On June
16, 2008, the Company acquired ALG Bio Oils Limited, which in turn owns 100% of
ALG Western Oils (Pty) Ltd. ALG Western Oils has the technology to make bio fuel
from algae and has entered into a Letter of Intent with Xstrata Alloys to begin
a bio fuel project at the Boshoek smelter in South Africa. This acquisition
continues the Company’s strategy of investing in energy related
enterprises.




The
Company intends to expand the making of bio fuels from algae to other large
mining Companies in South Africa.




The
company will also explore investments in other energy related enterprises. These
future activities will be dependent upon the Company’s ability to raise
additional funds. Currently, the Company does not have sufficient cash to
continue operations for the next twelve months. Our auditors have raised
substantial doubt about the Company’s ability to continue as a going concern.
Although no assurances can be given, management has received verbal assurances
from the related parties referred to above that such funding will continue as
needed. Based on these assurances, management expects that the Company will be
able to develop its interest in ALG Bio Oils Ltd. and execute its plan of
operations and continue as a going concern.




CAPITAL
RESOURCES AND LIQUIDITY




As of
December 31, 2008, the Company had cash of $1,196, not sufficient to fund
operations. Funding has been provided by and is expected to continue to be
provided by Global Investment Group, Inc. and various related parties of ALG Bio
Oils Limited. Should these various parties be unable to continue funding
operations, the Company may not be able to proceed with its business plan. The
Company’s auditors have raised substantial doubt about our ability to continue
as a going concern as sufficient cash is not on hand to continue operations for
the next twelve months and operating losses are expected to continue. However,
management has received verbal assurances from these related parties that such
funding will continue as needed.





CRITICAL
ACCOUNTING POLICIES AND CHANGES TO ACCOUNTING POLICIES




The
Company historically has utilized the following critical accounting policies in
making its more significant judgments and estimates used in the preparation of
its financial statements:




Variable Interest
Entities.In December 2003,
the FASB issued a revision to Interpretation No. 46, “Consolidation of
Variable Interest Entities” (“FIN No. 46R”), which was originally
issued in January 2003. FIN No. 46R provides guidance on the consolidation of
certain entities when control exists through means other than ownership of
voting (or similar) interests and was effective for public entities that have
interests in variable interest entities commonly referred to as special purpose
entities for the first reporting period that ends after March 15, 2004. FIN No.
46R requires consolidation by the majority holder of expected residual gains and
losses of the activities of a variable interest entity
(“VIE”).





Use of Estimates. In preparing
financial statements in conformity with accounting principles generally accepted
in the United States, management is required to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reported period. Actual
results could differ from those estimates and the differences could be
material.


13


Income Taxes. The Company
accounts for income taxes under Statement of Financial Accounting Standards No.
109, Accounting for Income Taxes ("Statement 109"). Under Statement 109,
deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. Under Statement 109, the
effect on deferred tax assets and liabilities of a change in tax rates is
recognized in income in the period that includes the enactment
date.





Impairment .The Company
accounts for any impairment in accordance with Statement of Financial Accounting
Standards No. 142, “Goodwill and Other Intangible Assets” (“Statement 142”).
Under Statement 142, intangible assets are reviewed for evidence or changes in
circumstances that indicate that their carrying value may not berecoverable. TheCompany periodically
reviews the carrying value to determine whether or not an impairment to such
value has occurred.





Foreign Currency Translation.The functional currency of the Company is the United States
Dollar.  The financial statements of the Company are translated to
United States dollars using period-end exchange rates as to assets and
liabilities and average exchange rates as to revenues and
expenses.  Capital accounts are translated at their historical
exchange rates when the capital transaction occurred.  Net gains and
losses resulting from foreign exchange translations are included in the
statements of operations and stockholders’ equity as other comprehensive income
(loss).




There
were no changes in accounting policies during the year.




OFF-BALANCE
SHEET ARRANGEMENTS




The
Company is not a party to any off- balance sheet arrangements.




DESCRIPTION
OF PROPERTY




The
Company does not own any real property or any interest in real property and does
not invest in real property or have any policies with respect thereto as a part
of their operations or otherwise.




Our
principal office facility is presently located in space owned by our president.
Rent has not been charged for the office space, and it is not expected that rent
will be charged in the near-term.




ITEM
8. FINANCIAL STATEMENTS.




The
company's financial statements are attached hereto and incorporated herein by
reference.


14




ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS




None.




ITEM
9A. CONTROLS AND PROCEDURES




CODE
OF ETHICS




The
Company has adopted a Code of Ethics that applies to employees, officers and
directors. The Code of Ethics was filed as Exhibit 14.1 to the Company's Form
10-KSB filed for the year ended December 31, 2004.




DISCLOSURE
CONTROLS AND PROCEDURES




The
Company maintains disclosure controls and procedures designed to ensure
information required to be disclosed in Company reports filed under the
Securities Exchange Act of 1934, as amended (“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 are designed to provide reasonable assurance 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.




Mr.
Arthur Johnson who is our Chief Executive Officer and Chief Financial Officer,
has evaluated the effectiveness of the Company’s disclosure controls and
procedures pursuant to Rule 13a-15(b) of the Exchange Act as of December 31,
2008. Based on that evaluation, the Company’s Chief Executive Officer and Chief
Financial Officer has concluded that the Company’s disclosure controls and
procedures are effective as of December 31, 2008.




MANAGEMENT’S
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING




The
Company’s management is responsible for establishing and maintaining adequate
internal control over financial reporting as defined in Rules 13a-15(f) under
the Securities Exchange Act of 1934. Pursuant to the rules and regulations of
the Securities and Exchange Commission, internal control over financial
reporting is a process designed by, or under the supervision of, the Company’s
principal executive and principal financial officers, and effected by the
Company’s board of directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
accounting principles generally accepted in the United States. Due to inherent
limitations, internal control over financial reporting may not prevent or detect
misstatements. Further, because of changes in conditions, effectiveness of
internal control over financial reporting may vary over time.




Mr Arthur
Johnson who is our Chief Executive Officer and Chief Financial Officer, has
evaluated the effectiveness of the Company’s internal control over financial
reporting as of December 31, 2008 based on the control criteria established in a
report entitled Internal Control — Integrated Framework, issued by the Committee
of Sponsoring Organizations of the Treadway Commission (COSO). Based on such
evaluation management has concluded that our internal control over financial
reporting is effective as of December 31, 2008.


15





Webb
& Company, P.A., the Company’s independent registered public accounting
firm, has not issued an attestation report on the effectiveness of the Company’s
internal controls over financial reporting since we are not yet required to
comply with this provision of Section 404(B) of the Sarbanes-Oxley
Act.




CHANGES
IN INTERNAL CONTROL OVER FINANCIAL REPORTING




There
were no changes in the Company’s internal control over financial reporting
during the Company’s fiscal quarter ending December 31, 2008, that have
materially affected, or are reasonably likely to materially affect, the
Company’s internal control over financial reporting.




PART
III




ITEM
10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS




OFFICERS
AND DIRECTORS




From
September 30, 2002 through September 23, 2005, Curtis Olschansky, 42, was the
sole officer and director of the Company. Mr. Olschansky served as AST's
President, principal executive officer and interim principal financial
officer.




On
September 23, 2005, James F. Mongiardo, 60, replaced Mr. Olschansky as sole
director and was elected Chief Executive Officer and President of the Company.
Mr. Mongiardo served as a director of the Company from September 23, 2005
through April 21, 2006.




Immediately
prior to the exchange of ownership with the original stockholders of
CardioBioMedical Corporation on April 21, 2006, Mr. Mongiardo resigned and
Arthur V. Johnson was appointed to the Board and to serve as President and
Secretary.




Arthur V.
Johnson‘s responsibilities include expansion of the company through
acquisitions. In addition, Mr. Johnson oversees all corporate governance and any
of our reporting requirements. From February 1998 to April 2003, Mr. Johnson was
Managing Director of Century Minerals (Pty) Ltd., a resource commodity trading
house. Mr. Johnson has over 30 years experience in mining and previously served
as a Director with Babcock International Group. Mr. Johnson previously sold his
own chrome business to SA Chrome, a public company. Mr. Johnson graduated from
the University of Cape Town in 1955 with a Degree in Commerce.





Nick
Theunissen has over 15 years experience in strategic planning on a national
level. He founded and owned a chrome mine on the Western Chrome Belt and a
coalmine at Ermelo in South Africa. He co-founded the ferrochrome smelter SA
Chrome & Alloys renamed to Merafe wich is currently owned by Xtrata. Nick
also founded Alumicor an alluminium smelter at Pietermaritzburg which were taken
over by an Australian group. He then founded  ALG Western Oil Ltd.
which was purchased by Odyssey Oil & Energy Inc. On August 26, 2008, Nick
was appointed Vice-President and Director of Odyssey Oil & Energy
Inc.


16





Summary Compensation Table;
Compensation of Executive Officers





The
following summary compensation table sets forth all compensation awarded to,
earned by, or paid to the named executive officers earned by us during the year
December 31, 2008 in all capacities for the accounts of our executives,
including the Chief Executive Officer (CEO) and Chief Financial Officer
(CFO):





SUMMARY
COMPENSATION TABLE




Name and
                      Principal
                      Position
                    
                    Year
                    
                    Salary
                      ($)
                    
                    
                    Bonus
                      ($)
                    
                    
                    Stock
                      Awards
                      ($)
                    
                    
                    Option
                      Awards
                      ($)
                    
                    
                    Non-Equity
                      Incentive Plan
                      Compensation
                      ($)
                    
                    
                    Non-Qualified
                      Deferred
                      Compensation
                      Earnings
                      ($)
                    
                    
                    All Other
                      Compensation
                      ($)
                    
                    
                    Totals
                      ($)Arthur
      Johnson:
                      CEO,
      CFO
                    
                    2008
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0Nicolaas
      Theunissen:
                      VP
                    
                    2008
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0
                    
                    
                    
                    0





Option Grants
Table.There were
no individual grants of stock options to purchase our common stock made to the
executive officers named in the Summary Compensation Table through December 31,
2008.





Aggregated
Option Exercises and Fiscal Year-End Option Value Table.There were no stock options
exercised during the year ended December 31, 2008 by the executive officers
named in the Summary Compensation Table.





Long-Term Incentive Plan
(“LTIP”) Awards Table.There were no awards made to the named executive officers in the last
completed fiscal year under any LTIP.




Compensation of
Directors





Directors
are permitted to receive fixed fees and other compensation for their services as
directors. The Board of Directors has the authority to fix the compensation of
directors. No amounts have been paid to, or accrued to, directors in such
capacity.





Employment
Agreements





As of
December 31, 2008, we do not have an employment agreement in place with our
officers and director.




AUDIT
COMMITTEE




The
Company currently does not have an audit committee; Arthur Johnson has acted and
will continue to act as the audit committee of the Board of
Directors.


17




NOMINATIONS




The Board
of Directors nominates candidates to stand for election as directors; other
candidates also may be nominated by any stockholder, provided that such other
nomination(s) are submitted in writing to the Secretary of the Company no later
than 90 days prior to the meeting of stockholders at which such directors are to
be elected, together with the identity of the nominator and the number of shares
of the Company's stock owned, directly or indirectly, by the nominator.
Directors are elected at the annual meeting of the stockholders, except for
vacancies and newly created directorships resulting from any increase in the
authorized number of directors elected by all of the stockholders having the
right to vote as a single class (which positions may be filled by the
affirmative vote of a majority of the directors then in office, although fewer
than a quorum, or by a sole remaining director), and each director elected shall
hold office until such director's successor is elected and qualified or until
the director's earlier death, resignation or removal. These procedures have not
changed since adopted by the Company.




ITEM
11. EXECUTIVE COMPENSATION




The
Company has not paid or accrued any compensation to Mr. Arthur Johnson or to Mr.
Nicolaas Theunissen.




OPTION
AND LONG-TERM INCENTIVE PLANS




The
Company has not maintained and currently does not maintain any option or similar
equity compensation plans or programs, or any long-term incentive programs or
plans, and no current or former officer has ever been granted any stock options
or stock appreciation or similar rights.




DIRECTOR
COMPENSATION




The
Company does not have arrangements, standard or otherwise, pursuant to which
directors are compensated for services provided as directors (including as
members of committees of the Board of Directors). The directors of the Company
have not been and currently are not compensated for their services as
directors.




EMPLOYMENT
AND RELATED AGREEMENTS




The
Company was not a party to any employment or other related
agreements.




ITEM
      12.
            SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
  MANAGEMENT




The
following table shows, as of December 31, 2008, the beneficial ownership of
Common Stock of the Company by (i) any person or group who is known to the
Company to be the beneficial owner of more than 5% of the Company's Common
Stock, (ii) the sole current director of the Company, (iii) the sole named
executive officer of the Company, and (iv) all current directors and executive
officers as a group.




Name and
Address of    Amount and Nature
of   Beneficial Owner Beneficial Ownership (1) Percent of
class


18




Name and Address of
                                            Beneficial Owners
                                          
                                          Amount and Nature of
                                            Beneficial Owner(1)
                                          
                                          
                                          Percent of
                                            ClassBio
      Oils Trust
                                            17
      GR, Xenopoulou Street
                                            limosol,
      Cyprus 3106
                                          
                                          
                                          30,000,000
                                          
                                          
                                          
                                          20.9
                                          %Daros
      Limited
                                          
                                          
                                          17,820,000
                                          
                                          
                                          
                                          12.4
                                          %P.O.Box
      363Rivonia,
      2128South
      AfricaBlue
      Dove Trust
                                          
                                          
                                          12,000,000
                                          
                                          
                                          
                                          8.3
                                          %P.O.Box
      363Rivonia,
      2128South
      AfricaCurtis
      Olschansky
                                          
                                          
                                          9,465,000
                                          
                                          
                                          
                                          6.6
                                          %9700
      Via EmilieBoca
      Raton, FL 33428Gani
      Investments Limited
                                          
                                          
                                          15,000,000
                                          
                                          
                                          
                                          10.4
                                          %P.O.Box
      54425Limosol,
      Cyprus 3724All
      current directors and executive officers as a group
                                          
                                          
                                          0
                                          
                                          
                                          
                                          0.00
                                          %


(1)
            Unless
      otherwise indicated, each of the persons named in the table above has sole
      voting and investment power with respect to the shares set forth opposite
      such person's name. With respect to each person or group, percentages are
      calculated based on the number of shares beneficially owned, including
      shares that may be acquired by such person or group within 60 days of
      December 31, 2008 upon the exercise of stock options, warrants or other
      purchase rights, but not the exercise of options, warrants or other rights
      held by any other person.




The
Company knows of no arrangement that may result in a change of
control.




19




ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS




During
the years ended December 31, 2008 and 2007, a related party advanced an
additional $67,042 and $108,087, respectively, in payment of operating and oil
well development expenses. These advances are unsecured, bear interest at 10%
per annum and are due on demand.




During
the year ended December 31, 2008, a related party advanced to ALG Bio Oils Ltd,
the Company’s wholly owned subsidiary, $21,729 in payment of operating
expenses.The loans
are non-interest bearing and are due at the discretion of the
director.




During
2005, 2006 , 2007 and 2008, the Company recorded additional paid-in capital of
$12,000 for the fair value of rent and services contributed to the Company by
its president.




On April
21, 2006, the Company issued 60 million shares of common stock to purchase a 10%
working interest in certain gas and oil leases in Texas for $165,000 ($.003 per
share) from Centurion Gold Holdings, Inc., a related public
company.




During
2003, the Company issued 21,375,000 shares of common stock to its President for
services with a fair value of $712,500.




During
2003, an officer advanced the Company $15,413 for start-up and operating
expenses. The advance is non-interest bearing, unsecured and due on
demand.




During
2005, 2004 and 2003, the Company recorded royalty expenses due to a related
party of $150,000, $187,813 and $15,625, respectively.




During
2005, a stockholder loaned the Company $49,656 for working capital. The loan
bears interest at 10%, is unsecured and due on demand.




During
2005, the Company issued 15,000,000 shares of common stock to its Chief
Executive Officer and President in recognition and consideration of his service
as an officer and director of the Company since June 2003 and his contributions
to the progress and development of the Company. For financial accounting
purposes, these shares were valued at $150,000 ($0.03 per share) based upon
recent market prices of the Company.




During
2005, the Company settled a dispute with a related party. The settlement
agreement called for the related party to return 49,500,000 shares of common
stock to the company and the company to give back the exclusive rights to the
patent. The shares were valued on the date of settlement and the company
recorded a loss on the settlement of $1,065,729.




In
January 2003, the Company entered into a licensing agreement with Exerciting,
LLC to acquire the exclusive rights associated with a product known as Better
Buns. The terms of the licensing agreement provided that the Company would pay
Exerciting a royalty of eight percent (8%) of gross revenues derived from the
Company's sales of the product and that the Company must achieve certain minimum
sales figures on an annual basis or pay minimum royalty payments of fifty
thousand dollars ($50,000) per quarter regardless of sales achieved, and issue
100,000 shares of its common stock to the members of the licensor. Curtis
Olschansky, the Company's former principal executive officer and director, is
the brother of Brad Olschansky and Scott Olschansky, who are the owners and
members of Exerciting, LLC. The Company issued 200,000 shares (after giving
effect to the stock split discussed below) to these individuals in January 2003.
This agreement was terminated during May 2005.


20




During
October 2003, the Company received non-interest bearing, unsecured, demand
working capital loans in the amount of $5,000 from Mr. Olschansky, its former
principal executive officer and director, and $5,000 from Meredith Dodrill, a
significant stockholder. These loans were forgiven in full in connection with
the Merger. During May 2005, the Company received a non-interest bearing,
unsecured, demand working capital loan of $5,750 from Mr. Olschansky, its former
principal executive officer and director. This loan was forgiven in full in
connection with the Merger Meredith Dodrill, a significant stockholder of the
Company, is married to James Dodrill, who served as corporate legal counsel for
the Company. Mr. Dodrill also acted as interim President of the Company upon its
inception. As of July 31, 2004, Mr. Dodrill was owed $50,000 for legal services
provided to the Company, which amount was forgiven in full in connection with
the Merger.




Because
of their initiatives in founding and organizing the Company, Mr. and Mrs.
Dodrill may both be considered promoters of the Company. Mrs. Dodrill is
presently the holder of 3,000,000 shares of our common stock, which were issued
in exchange for the forgiveness of expenses payable to Ms. Dodrill totaling
$10,000.




ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES




(A)
Audit Fees





The
aggregate fees billed for professional services rendered for the audit of annual
financial statements included in Form 10-K for the fiscal year ended December
31, 2008 and for the review of quarterly financial statements included in Form
10-QSB for the quarters ended March 31, June 30 and September 30, 2008 were
$9,112.





The
aggregate audit fees billed for professional services rendered for the audit of
annual financial statements included in Form 10-KSB for the fiscal year ended
December 31, 2007 and for the review of quarterly financial statements included
in Form 10-QSB for the quarters ended March 31, June 30 and September 30, 2007
were $12,929.





(B)
Audit-Related Fees





None.





(C) Tax
Fees





None





(D) All
Other Fees





None.




(E)  Audit
Committee Approval





We
currently do not have an audit committee.  Arthur Johnson, our president
has acted and will continue to act as the audit committee of the Board of
Directors.  All services performed by our auditor have been
pre-approved.


21




DESCRIPTION
OF SECURITIES




The only
securities of the Company currently outstanding are shares of its common stock,
$.0001 par value. The Company is authorized to issue 650,000,000 shares of its
common stock and 20,000,000 million shares of preferred stock, $.0001 par value,
although no classes or series of preferred stock have been designated. The Board
of Directors of the Company is authorized by the Company's Amended and Restated
Articles of Incorporation to fix the number and designations, powers,
preferences, rights and restrictions of any such class or series of preferred
stock.




Holders
of the Company's common stock are entitled to one vote per share on each matter
submitted to a vote at a meeting of shareholders. Except as otherwise expressly
provided by the law of the State of Florida or the Company's Amended and
Restated Articles of Incorporation or the resolution of the Board providing for
the issue of a series of preferred stock, the holders of the common stock shall
possess exclusive voting power for the election of directors and for all other
purposes.




Subject
to any prior rights to receive dividends to which the holders of shares of any
series of preferred stock may be entitled, the holders of shares of common stock
shall be entitled to receive dividends if and when declared payable from time to
time by the Board of Directors from funds legally available for payment of
dividends.




In the
event of any dissolution, liquidation or winding up of the Company, whether
voluntary or involuntary, after there shall have been paid to the holders of
shares of preferred stock the full amounts to which they may be entitled, the
holders of the then-outstanding shares of common stock shall be entitled to
receive, pro rata, any remaining assets of the Company available for
distribution to shareholders. The Board of Directors may distribute in kind to
the holders of common stock such remaining assets of the Company or may sell,
transfer or otherwise dispose of all or any part of such remaining assets to any
other corporation, trust or entity and receive payment in cash, stock or
obligations of such other corporation, trust or entity or any combination
thereof, and may sell all or any part of the consideration so received, and may
distribute the consideration so received or any balance or proceeds of it to
holders of common stock. The voluntary sale, conveyance, lease, exchange or
transfer of all or substantially all the property or assets of the Company
(unless in connection with that event the dissolution, liquidation or winding up
of the Company is specifically approved), or the merger or consolidation of the
Company into or with any other corporation, or the merger of any other
corporation into it, or any purchase or redemption of shares of stock of the
Company of any class, is not deemed to be a dissolution, liquidation or winding
up of this Corporation for the purposes of the foregoing.




Pursuant
to the Company's Amended and Restated Articles of Incorporation, no holder of
any shares of the Company of any class now or in the future authorized has any
preemptive right (other than such right, if any, as the Board of Directors in
its discretion may determine) to purchase or subscribe for any additional issues
of shares of the Company of any class now or in the future authorized, any
shares of the Company purchased and held as treasury shares, any part paid
receipts or allotment certificates in respect of any such shares, any securities
convertible into or exchangeable for any such shares, or any warrants or other
instruments evidencing rights or options to subscribe for, purchase or otherwise
acquire any such shares, whether such shares, receipts, certificates,
securities, warrants or other instruments be unissued, or issued and
subsequently acquired by the Company. Any such shares, receipts, certificates,
securities, warrants or other instruments, in the discretion of the Board, may
be offered from time to time to any holder or holders of shares of any class or
classes to the exclusion of all other holders of shares of the same or any other
class at the time outstanding.


22




Market
Price of and Dividends on the Registrant's Common Equity and Other Shareholder
Matters




The
Company's common stock was approved for unpriced quotation on the
Over-the-Counter Bulletin Board on October 19, 2004. It trades under the symbol
OOGI.OB. High and low bid information for the Company's common stock is not
currently available.




As of
December 31, 2008, there were 45 shareholders of record of our common stock and
a total of 143,742,500 shares outstanding.




We have
never paid any dividends and do not currently anticipate paying dividends in the
future. Any payment of cash dividends in the future will be dependent upon the
amount of funds legally available, our earnings, financial condition, capital
requirements and other factors that our Board of Directors deems
relevant.




There are
currently no outstanding options or warrants to purchase, or any securities that
are convertible into, our common stock. The single warrant to purchase 6,500,000
shares issued in connection with the CBM Merger was cancelled upon exchange of
ownership in CBM with the original stockholders.




The
Company does not maintain any option or similar equity compensation plans or
programs.




LEGAL
PROCEEDINGS




The
Company is not a party to any pending legal proceeding.




RECENT
SALES OF UNREGISTERED SECURITIES




None




INDEMNIFICATION
OF OFFICERS AND DIRECTORS




Section
11.3 of the Company's Amended and Restated Articles of Incorporation provides
that the Company must indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Company), by reason of the fact
that he/she is or was a director, officer, employee or agent of the Company, or
is or was serving at the request of the Company as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him/her in
connection with such action, suit or proceeding. Such indemnification is
predicated on the individual having acted in good faith and in a manner he/she
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his/her conduct was unlawful.




In
addition, the Amended and Restated Articles of Incorporation provide that the
Company shall indemnify any person who was or is a party or is threatened to be
made a party to any threatened pending or completed action or suit by or in the
right of the Company to procure a judgment in its favor by reason of the fact
that he/she is or was a director, officer, employee or agent of the Company, or
is or was serving at the request of the Company as a director, officer,
employee, or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees) actually and
reasonably incurred by him/her in connection with the defense or settlement of
such action or suit. Such indemnification is predicated on the individual having
acted in good faith and in a manner he/she reasonably believed to be in or not
opposed to the best interests of the Company and except that no indemnification
shall be made in respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable for negligence or misconduct in the
performance of his/her duty to the Company unless and only to the extent that
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such court shall deem proper.


23


To the
extent that a person has been successful on the merits or otherwise in defense
of any action, suit or proceeding or in defense of any claim, issue or matter
therein, he/she shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred by him/her in connection
therewith.




UNREGISTERED
SALES OF EQUITY SECURITIES




In
connection with the Merger discussed above, the Board of Directors of the
Company authorized the issuance of up to 22,077,509 shares of its common stock,
$0.0001 par value (representing 66.5% of the Company's issued and outstanding
shares following the Merger), to the stockholders of CBM. Such shares will be
exchanged, on a one-for- one basis, for up to 22,077,509 issued and outstanding
shares of common stock, $.01 par value, held by CBM's consenting shareholders.
The issuance of stock to U.S. stockholders was made in reliance on the exemption
from the registration requirements of the Securities Act of 1933, as amended,
pursuant to Section 4(2) thereof and to foreign stockholders pursuant to
Regulation S promulgated thereunder. Immediately after the closing of the
Merger, the Company had 33,175,009 shares of its common stock outstanding
assuming conversion of all CardioBioMedical Corporation common shares into
registrant's common stock. Pursuant to the terms of the Agreement, the Company
also issued a warrant to purchase 6,500,000 shares of its common stock to a
warrant holder of CBM in exchange for a CBM warrant representing such holder's
right to purchase 6,500,000 shares of CBM common stock. The warrant is not
exercisable until January 1, 2008 and will expire on December 31, 2014. The
exercise price is $.01 per share and the warrant is not assignable or
transferable by the holder.




On April
21, 2006, our Board of Directors authorized the purchase (the "Purchase") of a
ten percent (10%) working interest in an oil exploration project in the BBB
Area, Wharton, Texas from Centurion Gold Holdings, Inc., a related public
company. Presently, the business operations of BBB Area constitute all of the
business operations of the Company. As a result of the Purchase, the Company
disposed of CBM and returned to treasury 22,077,509 shares of the issued and
outstanding common stock and canceled the warrant to purchase 6,500,000 shares
of the Company's common stock at a purchase price of $.01 per
share.




On
November 21, 2007 our Board of Directors authorized the purchase (the
“Purchase”) of one hundred percent of a Uranium Prospect known as Springbok
Flats in the Bela Bela District, South Africa. The rights are being held through
the company MCA Uranium One (Pty) Ltd a wholly owned subsidiary of Odyssey Oil
& Energy, Inc. As a result of the purchase, the Company issued 5,000,000
shares of the Company’s common stock.




On June
16, 2008, the Company acquired ALG Bio Oils Limited, which in turn owns 100% of
ALG Western Oils (Pty) Ltd. ALG Western Oils. As a result of the Purchase the
Company issued 35,000,000 shares of the Company’s common stock at a purchase
price of $.01 per share.   The Company will issue a further
75,000,000 shares of the Company’s common stock at a purchase price of $.01 per
share, on commissioning the pilot plant at Boshoek.


24




CHANGES
IN CONTROL OF REGISTRANT




Upon the
closing of the Merger described above on September 23, 2005, two former
stockholders of CBM, James F. Mongiardo and Charles Minutolo, who together owned
95.7% of the issued and outstanding shares of common stock of CBM, became the
controlling stockholders of the Company as a result of their ownership of
approximately 63.7% of the outstanding shares of common stock the Company
following the Merger. The previous controlling stockholders of the Company were
Curtis Olschansky (7,000,000 shares or approximately 63%) and Meredith Dodrill
(3,000,000 shares or approximately 27%). Messrs. Mongiardo and Minutolo obtained
such control through the exchange by them of an aggregate 21,127,500 shares of
CBM common stock for an equal number of shares of common stock of AST issued in
connection with the Merger.




On April
21, 2006, with the Purchase referred to above, the Company disposed of CBM and
returned to treasury 22,077,509 shares of the issued and outstanding common. As
a result of the Purchase, Centurion Gold Holdings, Inc. became the controlling
stockholder of the Company as a result of their ownership of approximately 64.3%
(31.9% as of December 31, 2008) of the outstanding shares of common
stock.




There are
no other arrangements known to the Company, the operation of which may at a
subsequent date result in a change of control of the Company or which relate to
the election of directors or other matters.




The Board
of Directors of the Company consisted of Arthur Johnson, Nicolaas Theunissen and
Luan Theunissen.




Departure
of Directors or Principal Officers; Election of Directors; Appointment of
Principal Officers




On
September 23, 2005 in connection with the Merger described above, the AST Board
of Directors accepted the resignation of Curtis Olschansky as President,
principal executive officer, principal financial officer and director of the
Company and elected James F. Mongiardo to fill the vacancy on the Board. Mr.
Mongiardo was also elected to serve as Chief Executive Officer and President of
the Company.




Immediately
prior to the exchange of ownership with the original stockholders of
CardioBioMedical Corporation on April 21, 2006, Mr. Mongiardo resigned and
Arthur V. Johnson was appointed to the Board and to serve as President and
Secretary. The size of the Company’s Board was fixed at one until changed in
accordance with applicable law and the Company's Amended and Restated Articles
of Incorporation and Bylaws.




Arthur V.
Johnson‘s responsibilities include expansion of the company through
acquisitions. In addition, Mr. Johnson oversees all corporate governance and any
of our reporting requirements. From February 1998 to April 2003, Mr. Johnson was
Managing Director of Century Minerals (Pty) Ltd., a resource commodity trading
house. Mr. Johnson has over 30 years experience in mining and previously served
as a Director with Babcock International Group. Mr. Johnson previously sold his
own chrome business to SA Chrome, a public company. Mr. Johnson graduated from
the University of Cape Town in 1955 with a Degree in Commerce.


25




Mr.
Johnson serves as a director of Centurion Gold Holdings, Inc.  a
reporting company.  There are no family relationships among the
current director or executive officer (or nominees therefor) of Odyssey. Mr.
Johnson is not currently a party to an employment agreement with the Company and
has not been a party to any transaction with Odyssey. For more information on
related party transactions, see "Certain Relationships and Related Transactions"
herein.




On August
26, 2008, Nicolaas  Theunissen was appointed  to the Board
and to serve as Chairman .


26





ODYSSEY
      OIL AND ENERGY, INC.(Registrant)Dated:
      March 23, 2009By:
      /s/ Arthur JohnsonArthur
      JohnsonPrincipal
      Executive Officer,President,
      and Chief Financial
Officer


27


ODYSSEY
OIL & ENERGY, INC.  & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 CONSOLIDATED
FINANCIAL STATEMENTS
 AS OF DECEMBER 31,
2008
 
 
 
 ODYSSEY
OIL & ENERGY, INC.  & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 
 CONTENTS
 
 PAGE
                1
                REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMPAGE
                2
                CONSOLIDATED
      BALANCE SHEETS AS OF DECEMBER 31, 2008 AND 2007PAGE
                3
                CONSOLIDATED
      STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007
      AND FOR THE PERIOD FROM MAY 28, 2003 (INCEPTION) TO DECEMBER 31,
      2008PAGES
                4 –5
                CONSOLIDATED
      STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) FOR THE PERIOD FROM
      MAY 28, 2003 (INCEPTION) TO DECEMBER 31, 2008PAGES
                6 – 7
                CONSOLIDATED
      STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007
      AND FOR THE PERIOD FROM MAY 28, 2003 (INCEPTION) TO DECEMBER 31,
      2008PAGES
                8 - 20
                NOTES
      TO CONSOLIDATED FINANCIAL
STATEMENTS
 
 
 
 REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
 
 To the
Board of Directors of:
 Odyssey
Oil & Energy, Inc.
 (A
Development Stage Company)
 
 We have
audited the accompanying consolidated balance sheets of Odyssey Oil &
Energy, Inc. (F/K/A
Odyssey Oil & Gas, Inc.) and Subsidiaries (the “Company”) (a development
stage company) as of December 31, 2008 and 2007, and the related statements of
operations, changes in stockholders’ equity (deficit) and cash flows for the
years ended December 31, 2008 and 2007 and for the period from May 28, 2003
(inception) to December 31, 2008.  These financial statements are the
responsibility of the Company’s management. Our responsibility is to express an
opinion on these financial statements based on our audits.
 
 We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe
that our audits provide a reasonable basis for our opinion.
 
 In our
opinion, the consolidated financial statements referred to above present fairly
in all material respects, the consolidated financial position of Odyssey Oil
& Energy, Inc. and Subsidiaries (a development stage company) as of December
31, 2008 and 2007 and the results of its operations and its cash flows for the
years ended December 31, 2008 and 2007 and for the period from May 28, 2003
(inception) to December 31, 2008, in conformity with accounting principles
generally accepted in the United States of America.
 
 The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 10 to the
consolidated financial statements, the Company is in the development stage
with a net loss since inception of $30,873,295, a stockholders’ deficit of
$323,643, a working capital deficiency of $641,507, and net cash used in
operations of $1,178,974 since inception. These factors raise substantial doubt
about the Company's ability to continue as a going
concern.  Management's plans concerning these matters are also
described in Note 10. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
 
 
 WEBB
& COMPANY, P.A.
 Certified
Public Accountants
 
 Boynton
Beach, Florida
 March 18,
2009
 
 1
 
 ODYSSEY
      OIL & ENERGY, INC. & SUBSIDIARIES(F/K/A
      ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED BALANCE
  SHEETS
 
 As of December 31,2008
                                  
                                  
                                  2007ASSETSCURRENT
      ASSETSCash
                                  
                                  $
                                  1,196
                                  
                                  
                                  $
                                  450Total
      Current Assets
                                  
                                  
                                  1,196
                                  
                                  
                                  
                                  450Property
      & Equipment, net
                                  
                                  
                                  1,000
                                  
                                  
                                  
                                  -TOTAL
      ASSETS
                                  
                                  $
                                  2,196
                                  
                                  
                                  $
                                  450LIABILITIES AND STOCKHOLDERS' EQUITY
      (DEFICIT)CURRENT
      LIABILITIESAccounts
      payable and accrued expenses
                                  
                                  $
                                  327,208
                                  
                                  
                                  $
                                  87,085Loans
      payable and accrued interest - related parties
                                  
                                  
                                  315,495
                                  
                                  
                                  
                                  208,898Total
      Liabilities
                                  
                                  
                                  642,703
                                  
                                  
                                  
                                  295,983COMMITMENTS
      & CONTINGENCIESNON-CONTROLLING
      INTEREST
                                  
                                  
                                  (316,864
                                  )
                                  
                                  
                                  -STOCKHOLDERS'
      EQUITY (DEFICIT)Preferred
      stock, $.0001 par value, 20,000,000 shares authorized, none issued and
      outstanding
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Common
      stock, $.0001 par value, 650,000,000 shares authorized, 143,742,500 and
      108,292,500 shares issued and outstanding, respectively
                                  
                                  
                                  14,375
                                  
                                  
                                  
                                  10,830Additional
      paid-in capital
                                  
                                  
                                  26,786,251
                                  
                                  
                                  
                                  4,710,296Accumulated
      deficit during development stage
                                  
                                  
                                  (27,127,703
                                  )
                                  
                                  
                                  (5,016,659
                                  )Accumulated
      other comprehensive income
                                  
                                  
                                  3,434
                                  
                                  
                                  
                                  -Total
      Stockholders' Equity (Deficit)
                                  
                                  
                                  (323,643
                                  )
                                  
                                  
                                  (295,533
                                  )TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
      (DEFICIT)
                                  
                                  $
                                  2,196
                                  
                                  
                                  $
                                  450
 
 See
accompanying notes to consolidated financial statements.
 
 2
 
 ODYSSEY
      OIL & ENERGY, INC. & SUBSIDIARIES(F/K/A
      ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED STATEMENTS OF OPERATIONS AND
      COMPREHENSIVE LOSS
 
 For the Period fromFor the Year Ended December 31,
                      
                      
                      May 28,2003 (Inception)2008
                      
                      
                      2007
                      
                      
                      to December 31, 2008REVENUE
                      
                      $
                      -
                      
                      
                      $
                      7,450
                      
                      
                      $
                      26,695OPERATING
      EXPENSESDrilling
      costs and expenses
                      
                      
                      -
                      
                      
                      
                      51,886
                      
                      
                      
                      51,886General
      and administrative
                      
                      
                      403,562
                      
                      
                      
                      25,437
                      
                      
                      
                      457,134Professional
      fees
                      
                      
                      34,975
                      
                      
                      
                      34,051
                      
                      
                      
                      139,963Amortization
                      
                      
                      -
                      
                      
                      
                      18,668
                      
                      
                      
                      33,400Impairment
      of investment in oil and gas leases
                      
                      
                      -
                      
                      
                      
                      247,931
                      
                      
                      
                      247,931Impairment
      of bio-fuels plant development contract
                      
                      
                      21,717,235
                      
                      
                      
                      -
                      
                      
                      
                      21,717,235Impairment
      of investment in uranium mine
                      
                      
                      250,000
                      
                      
                      
                      -
                      
                      
                      
                      250,000Acquisition
      costs
                      
                      
                      -
                      
                      
                      
                      4,250,000
                      
                      
                      
                      4,250,000Total
      Operating Expenses
                      
                      
                      22,405,772
                      
                      
                      
                      4,627,973
                      
                      
                      
                      27,147,549LOSS
      FROM CONTINUING OPERATIONS
                      
                      
                      (22,405,772
                      )
                      
                      
                      (4,620,523
                      )
                      
                      
                      (27,120,854
                      )OTHER
      INCOME (EXPENSE)Interest
      income
                      
                      
                      4
                      
                      
                      
                      -
                      
                      
                      
                      2,793Interest
      expense
                      
                      
                      (22,140
                      )
                      
                      
                      (14,895
                      )
                      
                      
                      (45,337
                      )Non-controlling
      interest
                      
                      
                      316,864
                      
                      
                      
                      
                      
                      
                      
                      316,864Total
      Other Income (Expense)
                      
                      
                      294,728
                      
                      
                      
                      (14,895
                      )
                      
                      
                      274,320LOSS
      FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
                      
                      
                      (22,111,044
                      )
                      
                      
                      (4,635,418
                      )
                      
                      
                      (26,846,534
                      )Provision
      for Income Taxes
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -LOSS
      FROM CONTINUING OPERATIONS
                      
                      
                      (22,111,044
                      )
                      
                      
                      (4,635,418
                      )
                      
                      
                      (26,846,534
                      )LOSS
      FROM DISCONTINUED OPERATIONS
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      (4,026,761
                      )NET
      LOSS
                      
                      
                      (22,111,044
                      )
                      
                      
                      (4,635,418
                      )
                      
                      
                      (30,873,295
                      )OTHER
      COMPREHENSIVE INCOMEForeign
      currency translation gain
                      
                      
                      3,434
                      
                      
                      
                      -
                      
                      
                      
                      3,434COMPREHENSIVE
      LOSS
                      
                      $
                      (22,107,610
                      )
                      
                      $
                      (4,635,418
                      )
                      
                      $
                      (30,869,861
                      )LOSS
      PER COMMON SHARE - BASIC AND DILUTEDNet
      loss per share - Basic and Diluted
                      
                      $
                      (0.17
                      )
                      
                      $
                      (0.05
                      )Weighted
      average number of shares outstanding during the year - Basic and
      Diluted
                      
                      
                      127,590,860
                      
                      
                      
                      94,977,432
 
 See
accompanying notes to consolidated financial statements.
 
 3
 
 ODYSSEY
      OIL & ENERGY, INC. & SUBSIDIARIES(F/K/A
      ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED
      STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)FOR THE PERIOD FROM MAY 28, 2003 (INCEPTION) TO
      DECEMBER 31, 2008
 
 Accumulated
                    
                    
                    AccumulatedAdditional
                    
                    
                    Deficit During
                    
                    
                    Other
                    
                    
                    DeferredPreferred Stock
                    
                    
                    Common Stock
                    
                    
                    Paid-In
                    
                    
                    Development
                    
                    
                    Comprehensive
                    
                    
                    StockShares
                    
                    
                    Amount
                    
                    
                    Shares
                    
                    
                    Amount
                    
                    
                    Capital
                    
                    
                    Stage
                    
                    
                    Income
                    
                    
                    Compensation
                    
                    
                    TotalCommon
      stock issued to founders for cash ($.03 per share)
                    
                    
                    -
                    
                    
                    $
                    -
                    
                    
                    
                    7,500
                    
                    
                    $
                    1
                    
                    
                    $
                    249
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    250Common
      stock issued for license ($.03 per share
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    49,500,000
                    
                    
                    
                    4,950
                    
                    
                    
                    1,645,050
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    1,650,000Common
      stock issued to officer as compensation ($.03 per share)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    21,375,000
                    
                    
                    
                    2,138
                    
                    
                    
                    710,362
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    712,500Common
      stock issued for cash ($.03 per share)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    2,400,000
                    
                    
                    
                    240
                    
                    
                    
                    79,760
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    80,000Common
      stock issued for cash ($.15 per share)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    833,334
                    
                    
                    
                    83
                    
                    
                    
                    124,917
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    125,000Common
      stock issued to consultant for services ($.03 per share)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    24,600,000
                    
                    
                    
                    2,460
                    
                    
                    
                    817,540
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    820,000Net
      loss for the period from May 28, 2003 (inception) to December 31,
      2003
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (1,737,805
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (1,737,805
                    )Balance,
      December 31, 2003
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    98,715,834
                    
                    
                    
                    9,872
                    
                    
                    
                    3,377,878
                    
                    
                    
                    (1,737,805
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    1,649,945Common
      stock issued for cash ($.15 per share)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    2,016,693
                    
                    
                    
                    202
                    
                    
                    
                    302,301
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    302,503Net
      loss, 2004
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (551,203
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (551,203
                    )Balance,
      December 31, 2004
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    100,732,527
                    
                    
                    
                    10,074
                    
                    
                    
                    3,680,179
                    
                    
                    
                    (2,289,008
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    1,401,245Common
      stock issued in reverse merger
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    33,292,500
                    
                    
                    
                    3,329
                    
                    
                    
                    (3,329
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Common
      stock issued to consultant for services ($.01 per share)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    15,000,000
                    
                    
                    
                    1,500
                    
                    
                    
                    148,500
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    150,000Common
      stock cancelled related to license rights ($.01 per share)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (49,500,000
                    )
                    
                    
                    (4,950
                    )
                    
                    
                    (490,050
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (495,000
                    )In-kind
      contribution
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    12,000
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    12,000Warrants
      issued for non-exclusive license
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    143,238
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    143,238Net
      loss, 2005
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (1,696,989
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (1,696,989
                    )Balance,
      December 31, 2005
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    99,525,027
                    
                    
                    
                    9,953
                    
                    
                    
                    3,490,538
                    
                    
                    
                    (3,985,997
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (485,506
                    )
 
 See
      accompanying notes to consolidated financial
  statements.
 
 4
 
 ODYSSEY
      OIL & ENERGY, INC. & SUBSIDIARIES(F/K/A
      ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED
      STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)FOR THE PERIOD FROM MAY 28, 2003 (INCEPTION) TO
      DECEMBER 31, 2008
(CONTINUED)
 
 Accumulated
                            
                            
                            AccumulatedAdditional
                            
                            
                            Deficit During
                            
                            
                            Other
                            
                            
                            DeferredPreferred Stock
                            
                            
                            Common Stock
                            
                            
                            Paid-In
                            
                            
                            Development
                            
                            
                            Comprehensive
                            
                            
                            StockShares
                            
                            
                            Amount
                            
                            
                            Shares
                            
                            
                            Amount
                            
                            
                            Capital
                            
                            
                            Stage
                            
                            
                            Income
                            
                            
                            Compensation
                            
                            
                            TotalIn-kind
      contribution
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            12,000
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            12,000Common
      stock cancelled in connection with exchange of ownership in
      CardioBioMedicalCorporation to its original
      stockholders
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (66,232,527
                            )
                            
                            
                            (6,623
                            )
                            
                            
                            (3,211,742
                            )
                            
                            
                            3,745,592
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            527,227Common
      stock issued to purchase investment in oil and gas leases ($.003 per
      share)
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            60,000,000
                            
                            
                            
                            6,000
                            
                            
                            
                            159,000
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            165,000Net
      loss, 2006
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (140,836
                            )
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (140,836
                            )Balance,
      December 31, 2006
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            93,292,500
                            
                            
                            
                            9,330
                            
                            
                            
                            449,796
                            
                            
                            
                            (381,241
                            )
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            77,885In-kind
      contribution
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            12,000
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            12,000Common
      shares issued to acquire 100% of outstanding common shares of UraniumAcquisition Corp., Inc.
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            15,000,000
                            
                            
                            
                            1,500
                            
                            
                            
                            4,248,500
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            4,250,000Net
      loss, 2007
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (4,635,418
                            )
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (4,635,418
                            )Balance,
      December 31, 2007
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            108,292,500
                            
                            
                            
                            10,830
                            
                            
                            
                            4,710,296
                            
                            
                            
                            (5,016,659
                            )
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (295,533
                            )In-kind
      contribution
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            12,000
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            12,000Common
      stock issued to consultant for services ($.82 per share)
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            450,000
                            
                            
                            
                            45
                            
                            
                            
                            367,455
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            367,500Common
      shares issued to acquire 100% of outstanding common shares of ALG Bio Oils
      Ltd.
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            35,000,000
                            
                            
                            
                            3,500
                            
                            
                            
                            21,696,500
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            21,700,000Other
      comprehensive income
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            3,434
                            
                            
                            
                            -
                            
                            
                            
                            3,434Net
      loss, 2008
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (22,111,044
                            )
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            (22,111,044
                            )Balance,
      December 31, 2008
                            
                            
                            -
                            
                            
                            $
                            -
                            
                            
                            
                            143,742,500
                            
                            
                            $
                            14,375
                            
                            
                            $
                            26,786,251
                            
                            
                            $
                            (27,127,703
                            )
                            
                            $
                            3,434
                            
                            
                            $
                            -
                            
                            
                            $
                            (323,643
                            )
 
 See
      accompanying notes to consolidated financial
  statements.
 
 5
 
 ODYSSEY
      OIL & ENERGY, INC. & SUBSIDIARIES(F/K/A
      ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED STATEMENTS OF CASH
      FLOWS
 
 For the Period fromFor the Year Ended December 31,
                      
                      
                      May 28,2003 (Inception)2008
                      
                      
                      2007
                      
                      
                      to December 31, 2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                      
                      $
                      (22,111,044
                      )
                      
                      $
                      (4,635,418
                      )
                      
                      $
                      (30,873,295
                      )Net
      loss from discontinued operations
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      (4,026,761
                      )Loss
      from continuing operations
                      
                      
                      (22,111,044
                      )
                      
                      
                      (4,635,418
                      )
                      
                      
                      (26,846,534
                      )Adjustments
      to reconcile net loss to net cash used in Operating
      Activities:In-kind
      contribution
                      
                      
                      12,000
                      
                      
                      
                      12,000
                      
                      
                      
                      33,000Stock
      issued for services
                      
                      
                      367,500
                      
                      
                      
                      -
                      
                      
                      
                      367,500Amortization
                      
                      
                      -
                      
                      
                      
                      18,668
                      
                      
                      
                      33,400Impairment
      of investment in oil and gas leases
                      
                      
                      -
                      
                      
                      
                      247,931
                      
                      
                      
                      247,931Impairment
      of bio-fuels plant development contract
                      
                      
                      21,717,235
                      
                      
                      
                      -
                      
                      
                      
                      21,717,235Impairment
      of investment in uranium mine
                      
                      
                      250,000
                      
                      
                      
                      
                      
                      
                      
                      250,000Acquisition
      costs
                      
                      
                      -
                      
                      
                      
                      4,250,000
                      
                      
                      
                      4,250,000Non-controlling
      interest
                      
                      
                      (316,864
                      )
                      
                      
                      -
                      
                      
                      
                      (316,864
                      )Changes
      in operating assets and liabilities:Decrease
      in accounts receivable
                      
                      
                      -
                      
                      
                      
                      7,843
                      
                      
                      
                      -Increase
      (decrease) in accounts payable and accrued expenses
                      
                      
                      12,263
                      
                      
                      
                      (8,661
                      )
                      
                      
                      119,381Cash
      flows from operating activities in continuing operations
                      
                      
                      (68,910
                      )
                      
                      
                      (107,637
                      )
                      
                      
                      (144,951
                      )Cash
      flows from operating activities in discontinued operations
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      (1,034,023
                      )Net
      Cash Used In Operating Activities
                      
                      
                      (68,910
                      )
                      
                      
                      (107,637
                      )
                      
                      
                      (1,178,974
                      )CASH
      FLOWS FROM INVESTING ACTIVITIES:Purchase
      of property and equipment
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      (116,331
                      )Purchase
      of website
                      
                      
                      (1,000
                      )
                      
                      
                      -
                      
                      
                      
                      (1,000
                      )Acquisition
      of ALG Bio Oils Ltd. net of cash purchased
                      
                      
                      180
                      
                      
                      
                      -
                      
                      
                      
                      180Cash
      flows from investing activities in continuingoperations
                      
                      
                      (820
                      )
                      
                      
                      -
                      
                      
                      
                      (117,151
                      )Cash
      flows from investing activities in discontinuedoperations
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -Net
      Cash Used In Investing Activities
                      
                      
                      (820
                      )
                      
                      
                      -
                      
                      
                      
                      (117,151
                      )CASH
      FLOWS FROM FINANCING ACTIVITIES:Repayment
      of stockholder's loans
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      (609
                      )Proceeds
      from loans payable - related parties
                      
                      
                      67,042
                      
                      
                      
                      108,087
                      
                      
                      
                      251,378Cash
      flows from financing activities in continuing operations
                      
                      
                      67,042
                      
                      
                      
                      108,087
                      
                      
                      
                      250,769Cash
      flows from financing activities in discontinued operations
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      1,043,118Net
      Cash Provided By Financing Activities
                      
                      
                      67,042
                      
                      
                      
                      108,087
                      
                      
                      
                      1,293,887EFFECT
      ON EXCHANGE RATE ON CASH
                      
                      
                      3,434
                      
                      
                      
                      -
                      
                      
                      
                      3,434NET
      INCREASE IN CASH
                      
                      
                      746
                      
                      
                      
                      450
                      
                      
                      
                      1,196CASH
      AND CASH EQUIVALENTS AT BEGINNING OF YEAR
                      
                      
                      450
                      
                      
                      
                      -
                      
                      
                      
                      -CASH
      AND CASH EQUIVALENTS AT END OF YEAR
                      
                      $
                      1,196
                      
                      
                      $
                      450
                      
                      
                      $
                      1,196
 
 See
accompanying notes to consolidated financial statements.
 
 6
 
 ODYSSEY
      OIL & ENERGY, INC. & SUBSIDIARIES(F/K/A
      ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)(A
      DEVELOPMENT STAGE COMPANY)CONSOLIDATED STATEMENTS OF CASH FLOWS
      (CONTINUED)
 
 For the Period fromFor the Year Ended December 31,
                  
                  
                  May 28,2003 (Inception)2008
                  
                  
                  2007
                  
                  
                  to December 31, 2008SUPPLEMENTAL
      DISCLOSURE OF CASH FLOW INFORMATION:Cash
      paid for interest
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -Cash
      paid for income taxes
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  1,824
 
 SUPPLEMENTAL
DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
 
 During
2008, accounts payable of $250,000 incurred as a result of additional costs of
investment in uranium mine.
 
 On June
16, 2008, the Company assumed $17,235 of notes payable as part of the
acquisition of ALG Bio Oils Ltd.
 
 On June
16, 2008, the Company issued 35 million shares of common stock to acquire 100%
of the outstanding common shares of ALG Bio Oils Ltd.
 
 During
March 2008, the Company issued 450,000 shares of common stock with a fair value
of $367,500 to a consultant for services.
 
 On
November 20, 2007, the Company issued 15 million shares of common stock to
acquire 100% of the outstanding common shares of Uranium Acquisition Corp.,
Inc.
 
 On April
21, 2006, the Company issued 60 million shares of common stock to purchase a 10%
working interest in oil and gas leases in Texas for $165,000 from a related
public company.
 
 On April
21, 2006, the Company exchanged all of its ownership in CardioBioMedical
Corporation to the original stockholders for 66,232,527 common shares of Odyssey
and the warrants to purchase 19,500,000 shares of the Company's common stock was
cancelled.
 
 During
2003, the Company issued 49,500,000 shares of common stock with a fair value of
$1,650,000 for the license rights to the bio-cybernetic technology and frequency
analysis technology.
 
 During
2005, the Company cancelled 49,500,000 shares of common stock with a fair value
of $495,000 for the termination of the exclusive rights to the bio-cybernetic
technology and frequency analysis technology.
 
 During
2005, the Company issued warrants to purchase 19,500,000 shares of common stock
at $.003 for the non-exclusive rights to the bio-cybernetic technology and
frequency analysis technology valued at $143,238.
 
 See
accompanying notes to consolidated financial statements.
  7
  ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 NOTE
      1
              SUMMARY OF SIGNIFICANT
      ACCOUNTING POLICIES AND
ORGANIZATION
 
 (A) Organization and Basis
of Presentation
 
 Odyssey
Oil & Energy, Inc. (F/K/A Odyssey Oil & Gas, Inc. and previously
Advanced Sports Technologies, Inc) is a Florida corporation incorporated on
August 9, 2001. Effective September 20, 2008, the Articles of Incorporation were
amended to change the name of the corporation to Odyssey Oil & Energy, Inc.
Through its acquisition of Uranium Acquisition Corp. Inc., the Company owns a
49% interest in a South African company which owns a non-operating uranium mine
in the Bela Bela district in South Africa (Note 2).Through
its acquisition of ALG Bio Oils Ltd., the Company wholly owns a South African
company that has a preferred contract with a company to develop a commercial
bio-fuels plant (Note 2).  The Company’s investment in its 10% working
interest in oil and gas leases was expensed during the year ended December 31,
2007 as the gas well was plugged and abandoned at the recommendation of the
operator (Note 3).
 
 (B) Principles of
Consolidation
 
 The
financial statements for 2008 include the accounts of Odyssey Oil & Energy,
Inc., Uranium Acquisition Corp., Inc. (“Uranium”) (a development stage company),
whose sole asset is a 49% interest, acquired November 20, 2007, in MCA Uranium
One (Pty) Limited, and ALG Bio Oils Ltd. (a development stage company), acquired
June 16, 2008. All inter-company accounts during the period of consolidation
have been eliminated.
 
 The
financial statements for 2007 include the accounts of Odyssey Oil & Energy,
Inc. and its 49% interest in Uranium from November 20, 2007 (Date of
Acquisition)
 
 On April
21, 2006, the Company exchanged all of its ownership in CardioBioMedical
Corporation to the original stockholders. All amounts relating to the operations
of CardioBioMedical Corporation have been reflected as discontinued operations.
CardioBioMedical Corporation originally merged with Odyssey Oil & Gas, Inc.
(F/K/A Advanced Sports Technologies, Inc.) on September 23, 2005.
 
 Odyssey
Oil & Energy, Inc. (F/K/A Odyssey Oil & Gas, Inc. and previously
Advanced Sports Technologies, Inc.) is hereafter referred to as the
“Company.”
 
 As a
result of the transaction referred to in Note 4 (D), Centurion Gold Holdings,
Inc., a related public company, owns approximately 42% of the Company (55% as of
December 31, 2007).
 
 8
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 (C) Website Development
Costs
  The
Company has adopted the provisions of EITF 00-2, "Accounting for Web Site Development
Costs."  Costs incurred in the planning stage of a website are
expensed while costs incurred in the development stage are capitalized and
amortized over the estimated three-year life of the asset. For the period
ended December 31, 2008 and 2007, the Company paid $1,000 and $0, respectively,
to develop its website.
 
 (D) Fair Value of Financial
Instruments
 
 The
carrying amounts of the Company’s financial instruments including accounts
payable, accrued expenses and loans payable – related parties approximate fair
value due to the relatively short period to maturity for these
instruments.
 
 (E) Revenue
Recognition
 
 Revenue
from its interest in the oil and gas leases was recognized when production was
sold to a purchaser at a fixed or determinable price, when delivery had occurred
and title had transferred and collectability of the revenue was
probable.
 
 (F) Income
Taxes
 
 The
Company accounts for income taxes under the Statement of Financial Accounting
Standards No. 109, “Accounting for Income Taxes” (“Statement
109”).  Under Statement 109, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and
their respective tax bases.  Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recovered or
settled.  Under Statement 109, the effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that
includes the enactment date.
 
 (G) Loss Per
Share
 
 Basic and
diluted net loss per common share is computed based upon the weighted average
common shares outstanding as defined by Financial Accounting Standards No. 128,
“Earnings Per Share.”  As of December 31, 2008 and 2007, there were no
common stock equivalents.
 9
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 (H) Cash and Cash
Equivalents
 
 The
Company considers all highly liquid temporary cash investments with an original
maturity of three months or less to be cash equivalents. The Company did not
have any cash equivalents as of the balance sheet dates presented in the
financial statements.
 
 (I) Use of
Estimates
 
 In
preparing financial statements in conformity with generally accepted accounting
principles, management is required to make estimates and assumptions that affect
the reported amounts of assets and liabilities and the disclosure of contingent
assets and liabilities at the date of the financial statements and revenues and
expenses during the reported period.  Actual results could differ from
those estimates.
 
 (J) Stock
Split
 
 Effective
May 1, 2008, the Board of Directors approved a 3 for 1 stock split. As a result
of the stock split, all share and per share data have been retroactively
adjusted to give effect to the stock split.
 
 (K)
Impairment
 
 The
Company accounts for any impairment in accordance with Statement of Financial
Accounting Standards No. 142, “Goodwill and Other Intangible Assets” (“Statement
142”).  Under Statement 142, intangible assets are reviewed for
evidence or changes in circumstances that indicate that their carrying value may
not berecoverable.
TheCompany
periodically reviews the carrying value to determine whether or not an
impairment to such value has occurred.
 
 (L) Foreign Currency
Translation
 
 The
functional currency of the Company is the United States Dollar.  The
financial statements of the Company are translated to United States dollars
using period-end exchange rates as to assets and liabilities and average
exchange rates as to revenues and expenses.  Capital accounts are
translated at their historical exchange rates when the capital transaction
occurred.  Net gains and losses resulting from foreign exchange
translations are included in the statements of operations and stockholders’
equity as other comprehensive income (loss).
 10
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 (M) Recent Accounting
Pronouncements
 
 In
December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No.
160, “Noncontrolling Interests
in Consolidated Financial Statements – an amendment of ARB No.
51”.  This statement improves the relevance, comparability, and
transparency of the financial information that a reporting entity provides in
its consolidated financial statements by establishing accounting and reporting
standards that require; the ownership interests in subsidiaries held by parties
other than the parent and the amount of consolidated net income attributable to
the parent and to the noncontrolling interest be clearly identified and
presented on the face of the consolidated statement of income, changes in a
parent’s ownership interest while the parent retains its controlling financial
interest in its subsidiary be accounted for consistently, when a subsidiary is
deconsolidated, any retained noncontrolling equity investment in the former
subsidiary be initially measured at fair value, entities provide sufficient
disclosures that clearly identify and distinguish between the interests of the
parent and the interests of the noncontrolling owners.  SFAS No. 160
affects those entities that have an outstanding noncontrolling interest in one
or more subsidiaries or that deconsolidate a subsidiary.  SFAS No. 160
is effective for fiscal years, and interim periods within those fiscal years,
beginning on or after December 15, 2008. Early adoption is prohibited. The
adoption of this statement is not expected to have a material effect on the
Company's financial statements.
 
 In March
2008, the FASB issued SFAS No. 161, “Disclosures about Derivative
Instruments and Hedging Activities, an amendment of FASB Statement No. 133”
(SFAS 161). This statement is intended to improve transparency in financial
reporting by requiring enhanced disclosures of an entity’s derivative
instruments and hedging activities and their effects on the entity’s financial
position, financial performance, and cash flows. SFAS 161 applies to all
derivative instruments within the scope of SFAS 133, “Accounting for Derivative
Instruments and Hedging Activities” (SFAS 133) as well as related hedged items,
bifurcated derivatives, and nonderivative instruments that are designated and
qualify as hedging instruments. Entities with instruments subject to SFAS 161
must provide more robust qualitative disclosures and expanded quantitative
disclosures. SFAS 161 is effective prospectively for financial statements issued
for fiscal years and interim periods beginning after November 15, 2008,
with early application permitted. The adoption of this statement is not expected
to have a material effect on the Company's financial statements.
 
 In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles.” SFAS No. 162 identifies the sources of accounting
principles and provides entities with a framework for selecting the principles
used in preparation of financial statements that are presented in conformity
with GAAP. The current GAAP hierarchy has been criticized because it is directed
to the auditor rather than the entity, it is complex, and it ranks FASB
Statements of Financial Accounting Concepts, which are subject to the same level
of due process as FASB Statements of Financial Accounting Standards, below
industry practices that are widely recognized as generally accepted but that are
not subject to due process. The Board believes the GAAP hierarchy should be
directed to entities because it is the entity (not its auditors) that is
responsible for selecting accounting principles for financial statements that
are presented in conformity with GAAP.
 11
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 In May
2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee
Insurance Contracts-an interpretation of FASB Statement No. 60.” Diversity
exists in practice in accounting for financial guarantee insurance contracts by
insurance enterprises under FASB Statement No. 60, Accounting and Reporting by
Insurance Enterprises. This results in inconsistencies in the recognition and
measurement of claim liabilities. This Statement requires that an insurance
enterprise recognize a claim liability prior to an event of default (insured
event) when there is evidence that credit deterioration has occurred in an
insured financial obligation. This Statement requires expanded disclosures about
financial guarantee insurance contracts. The accounting and disclosure
requirements of the Statement will improve the quality of information provided
to users of financial statements. The adoption of FASB 163 is not expected to
have a material impact on the Company’s financial position.
 
 NOTE
      2
              ACQUISITIONS
 
 (A) Bio-Fuels
Company
 
 On June 16, 2008, the Company acquired
100% of the outstanding common shares of ALG Bio Oils
Ltd., a Cyprus development stage company through a share purchase
agreement.  ALG Bio Oils Ltd. owns 100% of the outstanding shares of
ALG Western Oil (Pty) Ltd., a South African company that has a preferred
contract with a company to develop a commercial bio-fuels plant. The Company
issued 35 million restricted common shares with a fair value of $21,700,000. An
additional 75 million restricted common shares are contingent upon the
occurrence of future specific events (Note 9). The following summarizes the fair
values of the assets acquired and liabilities assumed at the date of
acquisition:
  Cash
                          
                          $
                          180Intangible
      asset
                          
                          
                          21,717,235Total
      Assets Acquired
                          
                          
                          21,717,415Loans
      payable
                          
                          
                          (17,415
                          )Net
      Assets Acquired
                          
                          $
                          21,700,000
  The
intangible asset was assigned to the bio-fuels plant development contract.
Because of the uncertainty of completion and success of the project and the
uncertainty of the Company to successfully raise funds for this project, the
intangible asset was impaired during the year ended December 31,
2008.
 12
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 (B) Mining
Company
 
 On
November 20, 2007, the Company acquired 100% of the outstanding common shares of
Uranium Acquisition Corp., Inc., a Florida development stage company through a
share purchase agreement. Uranium Acquisition Corp., Inc. owns a 49% interest in
MCA Uranium One (Pty) Limited, a South African company which owns a
non-operating uranium mine in the Bela Bela district in South Africa. The share
purchase agreement also requires each shareholder to provide funding based on
the shareholders’ percentage of the pro rata amount of shares held based on the
future funding requirements of Uranium. If a shareholder does not provide the
required loans, the agreement gives the remaining shareholders the right to
force the sale of shares held by the non-compliant shareholder.
 
 The
Company issued 15 million restricted common shares with a fair value of
$4,250,000 ($0.28 per share based upon latest traded closing price). Under SFAS
No. 144, “Accounting   for the
Impairment or Disposal of Long-Lived Assets” and SEC Industry Guide 7,
“Description of Property by
Issuers Engaged or to be Engaged in Significant Mining Operations,” the
purchase price has been expensed as acquisition costs. In addition, during the
year ended December 31, 2008, the Company incurred other costs related to its
investment totaling $250,000. These additional costs have been impaired as the
Company has determined that there are no commercially minable deposits. (See
Note 9).
 
 NOTE
      3
              INVESTMENT IN OIL AND
      GAS LEASES
 
 On April
21, 2006, the Company issued 20 million shares of common stock to purchase a 10%
working interest in oil and gas leases in Texas for $165,000 ($.008 per share)
from Centurion Gold Holdings, Inc., a related public company.  The
investment was recorded at historical cost equal to the amount recorded by
Centurion Gold Holdings, Inc. The investment was being accounted for under the
cost method of accounting.
 
 During
the year ended December 31, 2007, the unamortized cost of the investment in oil
and gas leases of $247,931 was expensed as the gas well was plugged and
abandoned at the recommendation of the operator.
 
 NOTE
      4
              LOANS PAYABLE –
      RELATED PARTY
 
 During
the years ended December 31, 2008 and 2007, a related party advanced an
additional $62,728 and $108,087, respectively, in payment of operating and oil
well development expenses. These advances, totaling $251,593 and $188,865 as of
December 31, 2008 and 2007, respectively, are unsecured, bear interest at 10%
per annum and are due on demand. Accrued interest for loans payable – related
party was $42,173 and $20,033 as of December 31, 2008 and 2007, respectively.
Subsequent to December 31, 2008, an additional $10,000 in payment of operating
expenses was advanced. (See Notes 6 and 11).
 13
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 
 During
the year ended December 31, 2008, a related party advanced to ALG Bio Oils Ltd,
the Company’s wholly owned subsidiary, $4,314 in payment of operating expenses
and the Company assumed as part of the acquisition of ALG Bio Oils Ltd. $17,235
of notes payable.As
of December 31, 2008, the balance of $21,279 is non-interest bearing and is due
at the discretion of the director. Subsequent to December 31, 2008, an
additional $2,000 was advanced. (See Notes 6 and 11).
 
 NOTE
      5
              STOCKHOLDERS’
      EQUITY
 
 Effective
September 20, 2008, the Articles of Incorporation were amended to increase the
number of authorized common shares to 650,000,000 from 250,000,000.
 
 (A) Common Stock Issued for
Cash
 
 During
2003, the Company issued 7,500 shares of common stock to its founder for cash of
$250 ($0.033 per share).
 
 During
2003, the Company issued 2,400,000 shares of common stock for cash of $80,000
($0.033 per share).
 
 During
2003, the Company issued 833,334 shares of common stock for cash of $125,000
($0.15 per share).
 
 During
2004, the Company issued 2,016,693 shares of common stock for cash of $302,503
($0.15 per share).
 
 During
2005, the Company issued 33,292,500 shares of common stock to the stockholders
of Advanced Sports upon completion of the merger.
 
 (B)
Common Stock Issued for Services
 
 During
2003, the Company issued 21,375,000 shares of common stock for officer
compensation valued for financial accounting purposes at $712,500 ($0.033 per
share) based upon recent cash offering prices. The initial 7,500 shares issued
upon formation of the corporation were purchased for $.033 per
share.
 
 During
2003, the Company issued 49,500,000 shares of common stock for licensing rights
valued for financial accounting purposes at $1,650,000 ($0.033 per share, the
price paid for the initial 7,500 shares issued upon formation of the
corporation) based upon recent cash offering prices.  During 2005,
these 49,500,000 shares of common stock were cancelled pursuant to a settlement
agreement dated September 16, 2005. Under the terms of this agreement, a
nontransferable warrant for 19,500,000 common shares at $0.033 per share was
issued for the nonexclusive right to the technology. This warrant is exercisable
between January 1, 2007 and December 31, 2014. The fair value of the warrants
was estimated on the grant date using the Black-Scholes option pricing model as
required by SFAS 123 with the following assumptions: expected dividend yield 0%,
volatility 1%, risk-free interest rate of return of 3.28% and expected life of
7 years.  The value of $143,238 was recorded as intangible
license rights and will be amortized over the patent life of approximately 14
years.
 14
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 During
2003, the Company issued 24,600,000 shares of common stock for consulting
services valued for financial accounting purposes at $820,000 ($0.033 per share)
based upon recent cash offering prices.
 
 During
2005, the Company issued 15,000,000 shares of common stock to its Chief
Executive Officer and President in recognition and consideration of his service
as an officer and director of the Company since June 2003 and his contributions
to the progress and development of the Company.  For financial
accounting purposes, these shares were valued at $150,000 ($0.01 per share)
based upon recent market prices of the Company.
 
 Effective
January 1 2008, the Company entered into three one year contracts for consulting
services. As consideration, the Company issued 450,000 shares of common stock
valued for financial accounting purposes at $367,500 ($.82 per share) based upon
recent market prices of the Company. The value of the services is being
recognized over the contract term. As of December 31, 2008, the Company has
recorded $367,500 as consulting expense.
 
 (C) In-Kind
Contribution
 
 During
the years ended December 31, 2008 and 2007, the Company recorded additional
paid-in capital of $12,000 for the fair value of rent and services contributed
to the Company by its president.
 
 (D) Common Stock Issued in
Exchange of Assets
 
 On April
21, 2006, the Company exchanged all of its ownership in CardioBioMedical
Corporation to the original stockholders for 66,232,527 common shares of Odyssey
and the warrant issued to purchase 19,500,000 shares of the Company’s common
stock was cancelled based on the book value of assets and liabilities on the
date of exchange.
 
 On April
21, 2006, the Company issued 60 million shares of common stock to purchase a 10%
working interest in certain gas and oil leases in Texas for $165,000 ($.003 per
share) from Centurion Gold Holdings, Inc., a related public
company.
 
 On
November 20, 2007, the Company issued 15 million restricted common shares with a
fair value of $4,250,000 ($0.28 per share based upon latest traded closing
price) to acquire 100% of the outstanding common shares of Uranium Acquisition
Corp., Inc. (See Note 2).
 15
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 NOTE
      6
              RELATED PARTY
      TRANSACTIONS
 
 See Notes
4 and 5.
 
 NOTE
      7
              INCOME
      TAXES
 
 Income
tax expense (benefit) for the periods ended December 31, 2008 and 2007 is
summarized as follows:
 To
      Do2008
                        
                        
                        2007Current:Federal
                        
                        $
                        -
                        
                        
                        $
                        -State
                        
                        
                        -
                        
                        
                        
                        -Deferred
      - Federal and State
                        
                        
                        -
                        
                        
                        
                        -Income
      tax expense (benefit)
                        
                        $
                        -
                        
                        
                        $
                        -
 
 The
Company's tax expense differs from the "expected" tax expense for the periods
ended December 31, 2008 and 2007 as follows:
 
 2008
                        
                        
                        2007U.S.
      Federal income tax expense (benefit)
                        
                        $
                        (7,517,755
                        )
                        
                        $
                        (1,576,042
                        )State
      income tax expense (benefit)
                        
                        
                        (802,631
                        )
                        
                        
                        (168,266
                        )Permanent
      difference
                        
                        
                        (114,720
                        )
                        
                        
                        1,603,791Impairment
                        
                        
                        168,836
                        
                        
                        
                        93,296Effect
      on net operating loss carryforward
                        
                        
                        8,266,270
                        
                        
                        
                        47,221$
                        -
                        
                        
                        $
                        -
 
 The tax
effects of temporary differences that give rise to significant portions of
deferred tax assets and liabilities at December 31, 2008 and 2007 are as
follows:
 
 2008
                      
                      
                      2007Deferred
      tax assets:Net
      operating loss carryforward
                      
                      $
                      238,008
                      
                      
                      $
                      69,173Total
      gross deferred tax assets
                      
                      
                      238,008
                      
                      
                      
                      69,173Less
      valuation allowance
                      
                      
                      (238,008
                      )
                      
                      
                      (69,173
                      )Net
      deferred tax assets
                      
                      $
                      -
                      
                      
                      $
                      -
 16
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 At
December 31, 2008, the Company had a net operating loss carryforward of
approximately $632,400 for U.S. Federal income tax purposes available to offset
future taxable income expiring through 2028.  All other losses
incurred by the Company prior to the change in control are not available due to
Internal Revenue Code Section 382 which restricts the deductibility of prior net
operating losses where there has been a change in control.  The net
change in the valuation allowance during the year ended December 31, 2008 was an
increase of $68,836.
 
 NOTE
      8
              DISCONTINUED
      OPERATIONS
 
 On April
21, 2006, the ownership of CardioBioMedical Corporation was exchanged for
66,232,527 shares of Odyssey common stock to the original
stockholders.  Accordingly, all amounts relating to the operations of
CardioBioMedical Corporation have been reflected as discontinued operations. The
net book value of assets and liabilities of CardioBioMedical Corporation was
recorded as a distribution on the date of exchange. The loss from discontinued
operations was equal to operating expenses of CardioBioMedical
Corporation.
 
 NOTE
      9
              COMMITMENTS AND
      CONTINGENCIES
 
 Purchase
Agreements
 
 Uranium Acquisition
Corp.
 
 During
November 2007, the Company signed an agreement under which it acquired 100% of
the outstanding shares of Uranium Acquisition Corp., Inc. (“Uranium”), a Florida
corporation. The agreement called for the Company to issue 15 million shares of
Company stock upon signing of the agreement.  The agreement also calls
for the Company to issue 30 million shares upon approval of a mining license. In
addition, the agreement calls for the Company to deliver 75 million shares of
common stock, within 18 months of the signature of the agreement, upon the
proving up of uranium reserves being substantially the same as per the “Summary
of Geological Area and Write up” presented by Mineral Capital
Assets.
 
 The
agreement requires each shareholder to provide funding based on the
shareholders’ percentage of the pro rata amount of shares held based on the
future funding requirements of Uranium. If a shareholder does not provide the
required loans, the agreement gives the remaining shareholders the right to
force the sale of shares held by the non-compliant shareholder. The agreement
gives the controlling interest shareholders the right of first refusal on any
shares held by the Company at a price to be determined by the
shareholders.  As of December 31, 2008, no uranium reserves have been
proven and no additional shares are due under the agreement, however during the
year ended December 31, 2008, the Company incurred other costs related to its
investment totaling $250,000. These additional costs have been impaired as the
Company has determined that there are no commercially minable deposits (See Note
2(B)).
 17
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
  ALG Bio Oils
Ltd.
 
 During
June 2008, the Company signed an agreement under which it acquired 100% of the
outstanding shares of ALG Bio Oils Ltd. (Note 2 (A)). The agreement called for
the Company to issue 35 million shares of Company stock upon signing of the
agreement. The agreement also calls for the Company to issue an additional 25
million shares upon each of the following events:
 
 1. The
successful commissioning of a bio-fuels pilot plant,
 2. The
ordering of a commercial bio-fuels plant, and
 3. The
commissioning of a commercial bio-fuels plant.
 
 As of
December 31, 2008, none of the required events have been completed and no
additional shares are due under the agreement.
 
 NOTE
      10
              GOING
      CONCERN
 
 As
reflected in the accompanying financial statements, the Company is in the
development stage with a net loss since inception of $30,873,295, a
stockholders’ deficit of $323,643, a working capital deficiency of $641,507 and
net cash used in operations of $1,178,974 since inception. These factors raise
substantial doubt about its ability to continue as a going concern. The ability
of the Company to continue as a going concern is dependent on the Company’s
ability to raise additional capital and implement its business plan. The
financial statements do not include any adjustments that might be necessary if
the Company is unable to continue as a going concern.
 
 To date,
related parties have funded our operating cash
requirements.  Management has received verbal assurances from these
related parties that such funding will continue as needed.  Based on
these assurances, management expects that the Company will be able to develop
its interests in ALG Bio Oils Ltd. and execute its plan of operations and
continue as a going concern.
 
 NOTE
      11
              SEGMENT
      REPORTING
 
 The
accounting policies of the segments are the same as those described in
“Organization and Basis of Presentation” above. The Company’s business is
currently conducted principally in South Africa. As of December 31, 2008 and
2007, the Company had $598 and $0, respectively, of assets located in South
Africa.
 18
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 The
following table summarizes segment information:
 
 Bio-fuels
                            
                            
                            Other
                            
                            
                            ConsolidatedYear
      Ended December 31, 2008Impairment
      expense
                            
                            $
                            21,717,235
                            
                            
                            $
                            250,000
                            
                            
                            $
                            21,967,235Purchase
      of property and equipment
                            
                            
                            -
                            
                            
                            
                            (1,000
                            )
                            
                            
                            (1,000
                            )Net
      Loss
                            
                            
                            (21,724,198
                            )
                            
                            
                            (386,846
                            )
                            
                            
                            (22,111,044
                            )Total
      Assets
                            
                            
                            593
                            
                            
                            
                            1,603
                            
                            
                            
                            2,196Total
      Liabilities
                            
                            
                            21,729
                            
                            
                            
                            620,974
                            
                            
                            
                            642,703
 
 NOTE
      12
                VARIABLE INTEREST
      ENTITIES
 
 In
December 2003, the FASB issued a revision to Interpretation No. 46, “Consolidation of Variable Interest
Entities” (“FIN No. 46R”), which was originally issued in January 2003.
FIN No. 46R provides guidance on the consolidation of certain entities when
control exists through means other than ownership of voting (or similar)
interests and was effective for public entities that have interests in variable
interest entities commonly referred to as special purpose entities for the first
reporting period that ends after March 15, 2004. FIN No. 46R requires
consolidation by the majority holder of expected residual gains and losses of
the activities of a variable interest entity (“VIE”).
  As of
November 20, 2007, the Company owns a 49% interest in MCA through it’s
acquisition of Uranium Acquisition Corp, Inc. The Company has agreed to provide
financial support to MCA to fund all exploration costs up to the point of
proving the existence of ore.
  The
Company has concluded that MCA meets the definition of a VIE because MCA is
dependent on the Company for its funding and has been consolidated with the
Company.
  The
effect of the VIE’s consolidation on the Company’s consolidated balance sheet at
December 31, 2008, was an increase in the Company’s assets of $5 and an
increase in the Company’s liabilities of $620,934. The Company also recognized
non-controlling income of $316,864 for the year ended December 31,
2008.
 19
 ODYSSEY
OIL & ENERGY, INC. & SUBSIDIARIES
 (F/K/A
ODYSSEY OIL & GAS, INC. & SUBSIDIARIES)
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2008 AND
2007
 NOTE
      13
                SUBSEQUENT
      EVENTS
 
 Subsequent
to December 31, 2008, an additional $10,000 was advanced by a related party.
These advances are unsecured, bear interest at 10% per annum and are due on
demand (Note 4).
 
 Subsequent
to December 31, 2008, an additional $2,000 was advanced to ALG Bio Oils Ltd, the
Company’s wholly owned subsidiary, by a related party. The loans are
non-interest bearing and are due at the discretion of the director (Note
4).
  20