UNITED
STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549 FORM 10-Q/A



(Mark
One)

þQuarterly
report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period endedJune
30, 2008.



oTransition
report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from
to.



Commission
file number:000-30377



PROVIDENCE
RESOURCES, INC.

(Exact
name of registrant as specified in its charter)



|TEXAS(State or other jurisdiction ofincorporation or organization) | 06-1538201(I.R.S. Employer Identification No.)
|------------------------------------------------------------------ | ----------------------------------------------



5300
 Bee Caves Rd, Bldg 1 Suite 240, Austin, Texas, 78746 (Address of principal
 executive offices)    (Zip Code)

(512)
 970-2888

(Registrants
 telephone number, including area code)



N/A

(Former
 name, former address and former fiscal year, if changed
 since last report)



Indicate
 by check mark whether theregistrant:
 (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
 period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
 days: YesþNoo.



Indicate
 by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
 reporting company as defined by Rule 12b-2 of the Exchange Act:

Large
 accelerated fileroAccelerated fileroNon-accelerated fileroSmaller
 reporting companyþ



Indicate
 by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): YesoNoþ



AtOctober
 17, 2008, the number of shares outstanding of the
 registrant's common stock, $0.0001 par value (the only class of voting stock), was 60,261,118.




TABLE OF CONTENTS



|                                |                                                                                                  |                                                                                                                                                                                |    |    |    | 
|------------------------------- | ------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -- | -- | -- | 
|                                |                                                                                                  |                                                                                                                                                                                |    |   
|                                |                                                                                                  |                                                                                                                                                                                |    |   
|PART I. - FINANCIAL INFORMATION |                                                                                                  |                                                                                                                                                                                |    |   
|                                | ITEM 1.     FINANCIAL STATEMENTS                                                                 |                                                                                                                                                                                |    | 3  |   
|                                |                                                                                                  | Consolidated Balance Sheets as of June 30, 2008 (unaudited) and December 31, 2007 (audited)                                                                                    |    |    | 4  | 
|                                |                                                                                                  | Unaudited Consolidated Statements of Operations and Comprehensive Loss for the three and six month periods ended June 30, 2008 and June 30, 2007 and the period from inception |    |    | 5  | 
|                                |                                                                                                  | Unaudited Consolidated Statements of Cash Flows for the six month periods ended June 30, 2008 and June 30, 2007 and the period from inception                                  |    |    | 7  | 
|                                |                                                                                                  | Notes to Unaudited Consolidated Financial Statements                                                                                                                           |    |    | 9  | 
|                                |                                                                                                  | Supplemental Oil and Gas Information - FAS69                                                                                                                                   |    |    | 22 | 
|                                | ITEM 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations |                                                                                                                                                                                |    | 32 |   
|                                | ITEM 3.    Quantitative and Qualitative Disclosures about Market Risk                            |                                                                                                                                                                                |    | 39 |   
|                                | ITEM 4T.  Controls and Procedures                                                                |                                                                                                                                                                                |    | 39 |   
|                                |                                                                                                  |                                                                                                                                                                                |    |    |    | 
|                                |                                                                                                  |                                                                                                                                                                                |    |    |    | 
|                                |                                                                                                  |                                                                                                                                                                                |    |    |    | 
|PART II. - OTHER INFORMATION    |                                                                                                  |                                                                                                                                                                                |    |   
|                                | ITEM 1.     Legal Proceedings                                                                    |                                                                                                                                                                                |    | 39 |   
|                                | ITEM 1A.  Risk Factors                                                                           |                                                                                                                                                                                |    | 39 |   
|                                | ITEM 2.     Unregistered Sales of Equity Securities and Use of Proceeds                          |                                                                                                                                                                                |    | 44 |   
|                                | ITEM 3.     Defaults upon Senior Securities                                                      |                                                                                                                                                                                |    | 45 |   
|                                | ITEM 4.     Submission of Matters to a Vote of Securities Holders                                |                                                                                                                                                                                |    | 45 |   
|                                | ITEM 5.     Other Information                                                                    |                                                                                                                                                                                |    | 46 |   
|                                | ITEM 6.     Exhibits                                                                             |                                                                                                                                                                                |    | 46 |   
|                                | Signatures                                                                                       |                                                                                                                                                                                |    | 47 |   
|Index to Exhibits               |                                                                                                  |                                                                                                                                                                                | 48 |   

Explanatory Note

This Form 10-Q/A has been amended to: (a) make certain clarifications and corrections to our financial statements and notes; (b) include pro forma financial statements pertaining to the agreement with Elm
            Ridge Exploration Company ; (c) insert certain additions to our Controls and Procedures section.

2





PART
 I  FINANCIAL INFORMATION



ITEM
 1.     FINANCIAL STATEMENTS



As used
 herein, the terms Company, we, our, us, it, and its refer to
 Providence Resources, Inc., a Texas corporation, and its predecessors and subsidiaries, unless otherwise indicated.In
 the opinion of management, the accompanying unaudited, consolidated financial statements included in this Form 10-Q/A
 reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair
 presentation of the results of operations for the periods presented.  The results of operations for the periods presented are not
 necessarily indicative of the results to be expected for the full year.



3





|PROVIDENCE RESOURCES, INC. (An Exploratory Stage Company)CONSOLIDATED BALANCE SHEETS
|------------------------------------------------------------------------------------
|                                                                                    
|                                                                                    
|ASSETS                                                                              
|                                                                                    
|CURRENT ASSETS:                                                                     
|Cash                                                                                
|Note receivable                                                                     
|Prepaid expenses                                                                    
|Total current assets                                                                
|                                                                                    
|PROPERTY AND EQUIPMENT:                                                             
|Unproved oil and gas properties, not subject to amortization                        
|Total property and equipment                                                        
|                                                                                    
|OTHER ASSETS:                                                                       
|Loan origination fees, net of amortization of $73,250                               
|Total other assets                                                                  
|                                                                                    
|Total assets                                                                        
|                                                                                    
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                
|                                                                                    
|CURRENT LIABILITIES:                                                                
|Accounts payable                                                                    
|Accrued expenses                                                                    
|Related party payables                                                              
|Short-term note payable                                                             
|Short-term convertible promissory notes                                             
|Current portion of long-term notes payable                                          
|Total current liabilities                                                           
|                                                                                    
|CONVERTIBLE DEBENTURES (Note 5)                                                     
|LONG-TERM CONVERTIBLE PROMISSORY NOTES (Note 3)                                     
|LONG-TERM NOTES PAYABLE (Note 4)                                                    
|                                                                                    
|Total liabilities                                                                   
|                                                                                    
|MINORITY INTEREST IN NET ASSETS OF SUBSIDIARY                                       
|                                                                                    
|STOCKHOLDERS' EQUITY                                                                
|Preferred stock, $.0001 par value, 25,000,000 shares                                
|authorized, no shares issued and outstanding                                        
|Common stock, $.0001 par value, 250,000,000 shares authorized,                      
|60,261,118 and 59,161,118 shares issued and outstanding, respectively               
|Additional paid-in capital                                                          
|Accumulated other comprehensive income                                              
|Deficit accumulated during the exploratory stage                                    
|Total stockholder's equity                                                          
|Total liabilities and stockholders' equity                                          



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

4





|PROVIDENCE RESOURCES, INC.(An Exploratory Stage Company)CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOMEThree months and six months ended June 30, 2008 and 2007 and Cumulative Amounts
(Unaudited)
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|Sales                                                                                                                                                                                                            
|Cost of Sales                                                                                                                                                                                                    
|                                                                                                                                                                                                                 
|Gross profit                                                                                                                                                                                                     
|                                                                                                                                                                                                                 
|General and administrative expenses                                                                                                                                                                              
|                                                                                                                                                                                                                 
|Loss from operations                                                                                                                                                                                             
|                                                                                                                                                                                                                 
|Other income (expense):                                                                                                                                                                                          
|Interest expense                                                                                                                                                                                                 
|Debt conversion expense                                                                                                                                                                                          
|Interest income                                                                                                                                                                                                  
|Non-refundable option                                                                                                                                                                                            
|Impairment of capital assets                                                                                                                                                                                     
|Loss on disposal of assets                                                                                                                                                                                       
|                                                                                                                                                                                                                 
|Loss before provision for minority interest,                                                                                                                                                                     
|income taxes and discontinued operations                                                                                                                                                                         
|                                                                                                                                                                                                                 
|Minority interest                                                                                                                                                                                                
|                                                                                                                                                                                                                 
|Loss before provision for income taxes                                                                                                                                                                           
|and discontinued operations                                                                                                                                                                                      
|                                                                                                                                                                                                                 
|Provision for income taxes                                                                                                                                                                                       
|                                                                                                                                                                                                                 
|Net Loss                                                                                                                                                                                                         

5





|PROVIDENCE RESOURCES, INC.(An Exploratory Stage Company)CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOMEThree months and six months ended June 30, 2008 and 2007 and Cumulative Amounts
(Unaudited)
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|                                                                                                                                                                                                                 
|Continued from previous page                                                                                                                                                                                     
|                                                                                                                                                                                                                 
|Loss before discontinued operations  repeated from previous page                                                                                                                                                
|                                                                                                                                                                                                                 
|Gain (loss) from discontinued operations, net of tax                                                                                                                                                             
|                                                                                                                                                                                                                 
|Net loss before cumulative effect                                                                                                                                                                                
|of accounting change                                                                                                                                                                                             
|                                                                                                                                                                                                                 
|Cumulative effect of accounting change, net of tax                                                                                                                                                               
|                                                                                                                                                                                                                 
|Net loss                                                                                                                                                                                                         
|                                                                                                                                                                                                                 
|Loss per share from continuing operations - basic and diluted                                                                                                                                                    
|                                                                                                                                                                                                                 
|Net Loss per common share - basic and diluted                                                                                                                                                                    
|                                                                                                                                                                                                                 
|Weighted average common shares - basic and diluted                                                                                                                                                               
|                                                                                                                                                                                                                 
|Net loss                                                                                                                                                                                                         
|                                                                                                                                                                                                                 
|Other comprehensive income                                                                                                                                                                                       
|Foreign currency translation adjustment                                                                                                                                                                          
|                                                                                                                                                                                                                 
|Net comprehensive income (loss)                                                                                                                                                                                  



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

6





|PROVIDENCE RESOURCES, INC.(An Exploratory Stage Company)CONSOLIDATED STATEMENTS OF CASH FLOWSSix months ended June 30, 2008 and 2007 and Cumulative Amounts(Unaudited)
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                      
|                                                                                                                                                                      
|                                                                                                                                                                      
|                                                                                                                                                                      
|                                                                                                                                                                      
|Cash flows from operating activities:                                                                                                                                 
|Net loss                                                                                                                                                              
|Adjustments to reconcile net loss to net cash                                                                                                                         
|used in operating activities:                                                                                                                                         
|Shares issued for services                                                                                                                                            
|Shares issued with financing                                                                                                                                          
|Shares issued for debt and accrued interest conversion                                                                                                                
|Additional value of shares issued for debt and services conversion                                                                                                    
|Options issued for services                                                                                                                                           
|Amortization of conversion rights on debt                                                                                                                             
|Depreciation, amortization and impairment                                                                                                                             
|Minority interest                                                                                                                                                     
|Discontinued operations                                                                                                                                               
|Gain on write-off of liabilities                                                                                                                                      
|Loss on disposal of assets                                                                                                                                            
|(Increase) decrease in:                                                                                                                                               
|Accounts receivable and prepaid expenses                                                                                                                              
|Inventory                                                                                                                                                             
|Accounts payable                                                                                                                                                      
|Accrued expenses                                                                                                                                                      
|Related party payables                                                                                                                                                
|                                                                                                                                                                      
|Net cash used in operating activities                                                                                                                                 
|                                                                                                                                                                      
|Cash flows from investing activities:                                                                                                                                 
|Advances to Providence Exploration prior to acquisition                                                                                                               
|Cash of Providence Exploration on acquisition date                                                                                                                    
|Acquisition of intangible assets                                                                                                                                      
|Acquisition of property and equipment                                                                                                                                 
|Cash collected from notes receivable                                                                                                                                  
|Issuance of notes receivable                                                                                                                                          
|                                                                                                                                                                      
|Net cash used in investing activities                                                                                                                                 
|                                                                                                                                                                      

7





|PROVIDENCE RESOURCES, INC.(An Exploratory Stage Company)CONSOLIDATED STATEMENTS OF CASH FLOWSSix months ended June 30, 2008 and 2007 and Cumulative Amounts(Unaudited)
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                      
|                                                                                                                                                                      
|                                                                                                                                                                      
|                                                                                                                                                                      
|                                                                                                                                                                      
|                                                                                                                                                                      
|Continued from previous page                                                                                                                                          
|Cash flow from financing activities:                                                                                                                                  
|Current portion of long-term notes payable                                                                                                                            
|Proceeds from convertible promissory notes payable                                                                                                                    
|Issuance of common stock                                                                                                                                              
|Commissions paid to raise convertible debentures                                                                                                                      
|Minority investment in subsidiary                                                                                                                                     
|Proceeds from (payments for) convertible debentures                                                                                                                   
|Payments on notes payable                                                                                                                                             
|                                                                                                                                                                      
|Net cash provided by financing activities                                                                                                                             
|                                                                                                                                                                      
|Change in accumulated other comprehensive income                                                                                                                      
|                                                                                                                                                                      
|Net increase (decrease) in cash                                                                                                                                       
|                                                                                                                                                                      
|Cash, beginning of period                                                                                                                                             
|                                                                                                                                                                      
|Cash, end of period                                                                                                                                                   
|                                                                                                                                                                      
|Cash paid for interest                                                                                                                                                
|Cash paid for taxes                                                                                                                                                   
|                                                                                                                                                                      
|Non-cash investing and financing activities (Note 10)                                                                                                                 



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

8







PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note 1  Organization and Summary of Significant Accounting Policies

Organization

The consolidated financial statements consist of Providence Resources, Inc. (Providence Resources) and its wholly owned subsidiaries, Healthbridge AG, Providence
 Exploration LLC (Providence Exploration), PDX Drilling, LLC, Providence Resources, LLC, and a ninety percent interest in
 Comanche County Pipeline, LLC (collectively the Company).The Company was organized as Healthbridge, Inc.
 on February 17, 1993 (date of inception) under the laws of the State of Texas. Healthbridge AG was formed as a German subsidiary
 during 2002. The Company changed its name to Providence Resources, Inc. on September 29, 2006. Providence Exploration
 was formed on July 12, 2005. On November 21, 2005, the Company executed a letter of intent to acquire Providence Exploration and on
 September 29, 2006, the Company acquired Providence Exploration as a wholly owned subsidiary, pursuant to the closing of a Securities
 Exchange Agreement and a Note Exchange Agreement. In October of 2006, Providence Exploration entered into an agreement to form
 Comanche County Pipeline, LLC with the purpose of constructing an oil and gas pipeline in Comanche County, Texas.The Securities
 Exchange Agreement, entered into on April 10, 2006 with Providence Exploration and the unit holders of Providence Exploration,
 provided for the exchange of 4,286,330 shares of the Companys common stock for 1,250,000 issued and outstanding membership
 units of Providence Exploration. The Note Exchange Agreement, entered into on April 10, 2006 with the holders of certain promissory
 notes issued by Providence Exploration, provided for the exchange of 12,213,670 shares of the Companys common stock for the
 assignment of those promissory notes to the Company. The agreements were closed pursuant to shareholder approval at a special meeting
 of the shareholders held on September 29, 2006.Providence Exploration has been involved in exploration activities for the recovery
 of oil and gas from the Marble Falls and Barnett Shale formations in the Fort Worth basin and from the Ellenburger carbonate, Strawn
 carbonate and Pennsylvanian-Wolfcamp sandstone reservoirs in Val Verde County. The Fort Worth basin prospects included approximately
 7,374 acres of oil and gas leases and the Val Verde County prospects include approximately 12,832 acres of oil and gas leases.
 Providence Exploration has a 90% working interest and its joint venture operating partner, Harding Company, has a 10% working
 interest in the Fort Worth basin projects. As of June 30, 2008 the full value of the Fort Worth basin prospects and the Comanche
 County Pipeline LLC had been impaired due to a failure to produce commercial quantities of oil or gas from the prospects that lead to
 the expiration of the leases.The Company is considered an exploratory
 stage company as defined in SFAS No. 7.

9





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note 1 
 Organization and Summary of Significant Accounting Policies (continued)

Interim
 Financial Statements

The
 accompanying financial statements have been prepared by the Company without audit.  In the opinion of management, all
 adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of
 operations and cash flows at June 30, 2007 and June 30, 2008 and for the periods then ended have been made.Certain information and
 footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted
 in the United States of America have been condensed or omitted.  It is suggested that these interim financial statements be read
 in conjunction with the financial statements and notes thereto included in the Companys December 31, 2007 audited financial
 statements.  The results of operations for the periods ended June 30, 2008 and June 30, 2007 are not necessarily indicative of
 the operating results for the full year.

UnprovedOil
 and GasProperties,Not Subject to
 Amortization

Oil
 and gas lease costs were recorded at cost and consisted of 7,374.5 acres of land leases in North Eastern Texas in the Barnett Shale
 Formation, impaired as of June 30, 2008 and 12,847.2 acres of land leases in Southwest Texas in Val Verde County. The leases are
 undeveloped at June 30, 2008, and accordingly no depletion is included in the accompanying consolidated financial statements.

The
 Company follows the full cost method of accounting for exploration and development of oil and gas properties whereby all costs in
 acquiring, exploring and developing properties are capitalized, including estimate of abandonment costs, net of estimated equipment
 salvage costs, and perform quarterly impairment
 (ceiling) tests based on the net present value of proved reserves on the property. Management will write this intangible down to its
 net realizable value at the time impairment appears to exist. During fiscal 2007, management determined that due to the dry holes
 experienced to date, that the carrying values of the Companys oil and gas leases and its oil and gas pipeline exceeded the
 ceiling test amounts pursuant to Regulation S-X, Rule 4-10. Accordingly, the Company recorded impairment charges of $17,881,092 and
 $1,509,734 on the leases and pipeline respectively. During fiscal 2008, the Company recorded an impairment charge of $2,000,000 which
 was the capitalized cost of Comanche and Hamilton County
 leases that expiredon their own terms
 inthe period.

Prior
 to acquisition on September 29, 2006, Providence Exploration capitalized $3,278,647 in exploration costs, which costs have now been
 impaired. No costs related to production, general corporate overhead, or similar activities were capitalized. As of June 30, 2008,
 the Company only has capitalized costs of unproved properties acquired and related exploration costs in connection with the Val Verde
 County leases. Leasehold costs are depleted based on the units-of-production method based on estimated proved reserves. No proved
 reserves currently exist for the Company and therefore no depletion has been taken as of June 30, 2008.



10





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            June 30, 2008 and 2007


Note 1 — Organization and Summary of Significant Accounting Policies (continued)

Concentration of Credit Risk

The Company maintains its cash in bank deposit accounts, which, at times, may exceed federally insured limits. At June 30, 2008, the Company had $1,108,091 in bank deposit accounts. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents.

Stock-Based Compensation

On June 13, 2008, the Company adopted the 2008 Stock Option Plan (the “Plan”). The Plan provides eligible persons the opportunity to acquire a proprietary interest in the corporation through the grant of up to 2,000,000 incentive stock options (“ISO”) and 23,000,000 non-statutory stock options (“NSO”). No option shall have a term in excess of 10 years measured from the option grant date

Earnings Per Share

The numerator for the earnings per share calculation is the net loss for the period. The denominator is the weighted average number of shares outstanding during the period.

The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the period plus the common stock equivalents which would arise from the exercise or conversion of warrants, options and convertible securities, if any, using the treasury stock method. The Company had 7,267,650 stock equivalents of warrants at June 30, 2008 that were excluded from the calculation of diluted earnings per share. The Company had 4,650,000 options
        outstanding at June 30, 2008 under the 2008 Stock Option Plan. Common stock equivalents are not included in the diluted earnings per share calculation when their effect is antidilutive.

Earnings Per Share computation for Continuing operations:
                                                                                                     
         Six months ended June 30,

20082007





Numerator – (loss from continuing operations)       $     (4,857,704)          $     (1,008,817)
                  Denominator – weighted average
                   number of shares outstanding59,366,60052,196,600Loss per share$     (0.08)$     (0.02)



Earnings Per Share computation from Discontinued Operations:
                                                                                                    
              Six months ended June 30,

20082007





Numerator – (loss from discontinued operations)                     
        $     Nil          $     Nil
                  Denominator – weighted average
                   number of shares outstanding59,366,60052,196,600Loss per share-discontinued operations$     (0.00)$     (0.00)



11





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            June 30, 2008 and 2007


Note 1 — Organization and Summary of Significant Accounting Policies (continued)

Earnings Per Share (continued)

Earnings Per Share computation for Net Income:

Six months ended June 30,

20082007





Numerator – (Net Loss)                                      
          $     (4,857,704)          $     (1,008,817)
                  Denominator – weighted average
                   number of shares outstanding59,366,60052,196,600Loss per share$     (0.08)$     (0.02)





Reclassifications
         Certain amounts in the 2007 financial statements may have been reclassified to conform to the 2008 presentation.





Note 2 — Going ConcernAs of June 30, 2008, the Company’s revenue generating activities are not in place, and the Company has incurred losses of $42,976,663 since inception. This factor raises substantial doubt about the Company’s ability to continue as a going concern.
         
        We anticipate that additional funding may be required in the next twelve months and that it will be in the form of equity financing from the sale of our common stock. However, we do not have any financing arranged and we cannot provide investors with firm assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our plan of operations in the event that such funding becomes necessary.



Note 3 – Long-term Convertible Promissory Notes



The Company has ten outstanding secured convertible promissory notes with a total face value of $5,919,362. The principal and interest are due in full on the maturity date of the notes. The notes are secured by:

| | 1. | All seismic data obtained in connection with the 3D Seismic Project Proposal and Agreement dated March 27, 2007 between the Company and TRNCO Petroleum Corporation which seismic data may not be shared with any third party without the express written consent of the holder of the note.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 2. | Any and all proceeds arising from or attributable to the assets.
| | -- | ----------------------------------------------------------------

12





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 3  Long-term Convertible Promissory Notes (continued)

At
 the sole discretion of the holder, the principal and accrued interest on the note may be converted into shares of the Companys
 common stock. The promissory notes bear interest at rates that range between 10% and 12% per annum. The principal and interest on
 notes can be converted into shares of common stock at a conversion price of $0.08.

| | Convertible Promissory Note Payable  Global Project Finance AG, secured, payable in full on May 31, 2010, including interest at 10%, convertible at $0.08 per common share.              | $ 1,000,000  
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------
| | Convertible Promissory Note Payable  Global Convertible Megatrend Ltd., secured, payable in full on August 8, 2010, including interest at 10%, convertible at $0.08 per common share.    | $ 1,400,000  
| | Convertible Promissory Note Payable  Golden Beach Company Ltd., secured, payable in full on August 8, 2010, including interest at 10%, convertible at $0.08 per common share.            | $ 100,000    
| | Convertible Promissory Note Payable  CR Innovations AG, secured, payable in full on August 8, 2010, including interest at 10%, convertible at $0.08 per common share.                    | $ 600,000    
| | Convertible Promissory Note Payable  Global Project Finance AG, secured, payable in full on August 8, 2010, including interest at 10%, convertible at $0.08 per common share.            | $ 400,000    
| | Convertible Promissory Note Payable  Global Undervalued Investment Ltd., secured, payable in full on August 15, 2010, including interest at 10%, convertible at $0.08 per common share.  | $ 250,000    
| | Convertible Promissory Note Payable  FE Global Leveraged Investment Ltd., secured, payable in full on August 15, 2010, including interest at 10%, convertible at $0.08 per common share. | $ 250,000    
| | Convertible Promissory Note Payable  Miller Energy LLC, secured, payable in full on April 29, 2010, including interest at 10%, convertible at $0.08 per common share.                    | $ 1,000,000  
| | Convertible Promissory Note Payable  FAGEB AG, secured, payable in full on March 4, 2010, including interest at 12%, convertible at $0.08 per common share.                              | $ 4 96,174   
| | Convertible Promissory Note Payable  Global Convertible Megatrend Ltd., secured, payable in full on March 4, 2010, including interest at 12%, convertible at $0.08 per common share      | $ 423,188    
| |                                                                                                                                                                                           |              
| | Total Principal Long-Term Convertible Promissory Notes Payable                                                                                                                            | $ 5,919,362  
| | Less:  unamortized discount                                                                                                                                                               | ($ 3,970,072)
| |                                                                                                                                                                                           |              
| | Net book value                                                                                                                                                                            | $1,949,290   

13





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 3  Long-term Convertible Promissory Notes (continued)For the six months ended
 June 30, 2008, the Company recorded $309,182 as interest and financing expense relating to long-term convertible promissory notes.
 Accrued interest as at June 30, 2008 for the outstanding long-term convertible promissory notes totaled $529,483.

The
 fair value of the conversion option on the long-term promissory notes using the intrinsic value method was recorded as a discount on
 the face value of the notes. This amount will be amortized using the straight-line method over the term of the notes. In the six
 months ended June 30, 2008, the Company recorded $1,092,774 as interest expense due to amortization of the discount.



Note
 4  Long-term Notes Payable



| | Note Payable - Global Convertible Megatrend LTD, unsecured, principal payable in full on February 23, 2010, interest at 10% payable at the end of each fiscal quarter, interest convertible to common shares at $0.08 per share. | 500,000 
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------
| | Note Payable  Bluemont Investment Ltd, payable in full by August 8, 2010, including interest at 10%.                                                                                                                            | 200,000 
| |                                                                                                                                                                                                                                  |         
| | Total                                                                                                                                                                                                                            | $700,000



For
 the six months ended June 30, 2008, the Company recorded $34,873 as interest and financing expense relating to long-term notes
 payable. Accrued interest as at June 30, 2008 for the outstanding long-term notes payable totaled $151,339.



Note
 5  Convertible Debentures The convertible debentures are secured by substantially
 all of the Companys assets consisting of all tangible and intangible property.On November 28, 2005, the
 Company issued seven convertible debenture certificates for the total principal sum of $3,320,000 due in full with accrued and unpaid
 interest on November 30, 2010. The interest at a rate of 7.0% per annum is payable on a semi-annual basis with the initial payment
 due on June 1, 2006. The holders of the debentures has the right to convert all or part of the principal and accrued interest into
 common shares of the Company at $0.35 per share at any time prior to maturity.  On August 24, 2006, the interest accrued on the
 seven debentures was partially converted into shares of common stock at $0.35 per share.  The Company issued 263,563 shares for
 $92,247 of interest owed.  The Company recorded an additional interest expense of $144,960 to reflect the value of the shares issued
 upon conversion of the book amount.

14





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 5  Convertible Debentures (continued) On December 1, 2006, the interest accrued
 on the seven debentures was partially converted into shares of common stock at $0.35 per share.  The Company issued 260,712 shares
 for $91,249 of interest owed.  The Company recorded an additional interest expense of $52,142 to reflect the value of the shares
 issued upon conversion of the book amount. On June 13, 2007, the principal amount of a $250,000 debenture to Global Convertible
 Megatrend Ltd. and $12,357 of accrued interest were converted into shares of common stock at $0.10 per share. After applying the 10%
 bonus, the Company issued 2,873,563 shares of common stock to extinguish $287,356 of debt consisting of $250,000 of principal
 repayment and $37,356 in accrued interest and bonus.The Company recordedan
 interest and financing expense of $139,944 to reflect the value of the shares issued upon
 conversion in excess of the debt and interest amounts.On December 1, 2007, the interest
 accrued on the seven debentures was partially converted into sharesof common stock at between
 $0.15 and $0.35 per share.  The Company issued 994,516 shares for $178,214 of interest owed. For
 the six months ended June 30, 2008, the Company recorded $76,406 as interest and financing expense relating to convertible
 debentures. Accrued interest as at June 30, 2008 for all outstanding debentures totaled $200,507. The total value of the principal
 of the seven convertible debentures, the ten long-term convertible promissory notes and the two long-term notes payable outstanding
 as of June 30, 2008 was $9,939,362.  Repayment of this principle is due according to the following schedule:

|                                       | 2008 | 2009 | 2010      | 2011 | 2012
|-------------------------------------- | ---- | ---- | --------- | ---- | ----
|Convertible debentures                 | -    | -    | 3,320,000 | -    | -   
|Long-term convertible promissory notes | -    | -    | 5,919,362 | -    | -   
|Long-term notes payable                | -    | -    | 700,000   | -    | -   
|Total                                  | -    | -    | 9,939,362 | -    | -   



Note
 6  Notes Receivable

The
 Company has a note receivable due from Central Basin Oil Investments for $250,000 as of June 30, 2008. A payment was due on August 1,
 2008, for the remaining balance of the note. Subsequent to the period ended June 30, 2008, the note was amended to extend the due
 date to October 1, 2008.



15





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 7  Related Party Transactions The Company entered into an agreement with Markus
 Mueller, a director of the Company for consulting services. The agreement had an automatic renewal provision unless terminated by
 either party. During the six months ended June 30, 2008 and 2007, the Company recognized consulting expense of $22,500 and $45,000
 respectively. A balance of $75,000 was due to Mr. Mueller at March 31, 2008. The agreement was terminated on March
 31, 2008. The Company issued 500,000 shares of common stock at $0.15 per share in satisfaction of amounts due totaling an aggregate
 of $75,000. Fair value of shares issued was $100,000. The excess ($25,000) was recorded as a Debt Conversion Expense. The Company
 has entered into an agreement with Nora Coccaro, a director of the Company for consulting services. The agreement has an automatic
 renewal provision unless terminated by either party. During the six months ended June 30, 2008 and 2007, the Company recognized
 consulting expense of $48,000 and $45,500 respectively. The balance of $8,000 was due to Ms.
 Coccaro at June 30, 2008.The Company has entered into an agreement with Gil Burciaga, a director
 of the Company for consulting services. During the six months ended June 30, 2008 and 2007, the Company recognized consulting expense
 of $75,000 and $Nil respectively. The balance of $75,000 was due to Mr. Burciaga at June 30, 2008. As of six months ended June 30,
 2008 he has vested 4,650,000 stock options. Gil Burciaga was appointed president and CEO of the Company on May 1,
 2007. The term of the agreement shall for 4 years beginning on May 1, 2007 and ended on April 30, 2011. The Company will pay Gil
 Burciaga an annual base salary of $150,000, which shall be payable monthly as it accrues. Mr. Burciaga is entitled to stock options
 as follows: 1,850,000 Incentive stock options, 5,650,000 Tenure stock options, and Performance stock options if he successfully meets
 certain performance requirements.



Note
 8  Stockholders Equity Transactions During the year ended December 31,
 2007, the Company issued 1,450,000 shares of common stock valued at $285,000 for consulting and legal services.The
 Company recordedanadditionalinterest
 and financing expense of $22,500 to reflect the value of the shares issued upon conversion in
 excess of the debt and interest amounts.During the year ended December 31, 2007, the
 principal amount of a $250,000 convertible debenture to Global Convertible Megatrend Ltd. and $12,357 of accrued interest were
 converted into shares of common stock at $0.10 per share. After applying a 10% bonus, the Company issued 2,873,563 shares of common
 stock to extinguish $287,356 of debt consisting of $250,000 of principal repayment and $37,356 in accrued interest and bonus. The
 Company recorded compensation expense of $139,944 to reflect the value of the shares issued upon conversion in excess of the debt and
 interest amounts.During the year ended December 31, 2007, the Company issued 994,516 shares of common stock to extinguish $178,214
 in accrued interest on convertible debentures. During year ended December 31, 2007, the Company issued 1,987,500 shares of common
 stock for total proceeds of $236,700. During the year ended December 31, 2007, the Company recorded $4,091,667 of discount on
 promissory notes to value their conversion option as calculated using the intrinsic value method.

16





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 8  Stockholders Equity Transactions (continued) During the six months ended
 June 30, 2008, the Company issued 500,000 shares of common stock to Markus Mueller, a director of the Company, at $0.15 per share in
 satisfaction of amounts due for consulting services totaling an aggregate of $75,000. Fair value of shares issued was $100,000. The
 excess ($25,000) was recorded as a Debt Conversion Expense.During the six months ended June 30, 2008, the Company entered into an
 agreement with Edward Moses for his services as a director. For his services rendered, the Company issued 100,000 shares of common
 stock in satisfaction of amounts due of $20,000. During the six months ended June 30, 2008, the Company entered into an agreement
 with Bill Purves for his advisory services. For his services rendered, the Company issued 500,000 shares of common stock in
 satisfaction of amounts due $100,000.



Note
 9  Warrants

During
 2005, in connection with the offering of 6,270,000 shares common stock and $3,320,000 of convertible debentures during the year, a
 sales commission was partially paid in warrants.  The warrants are exercisable in whole or in part allowing the holders to purchase
 348,000 shares at an exercise price of $0.30 before the expiry date of December 1, 2010.  On the date granted, the fair market value
 of these warrants, totaling $191,400, consisted of $68,970 for warrants issued in connection with the common stock offering, and
 $122,430 for warrants issued in connection with the debenture offering.  The value of the warrants issued in connection with the
 debenture offering was recorded as a financing expense.

Transactions
 involving the Companys warrant issuance are summarized as follows:

|            |  | Warrants Outstanding |      |                           |  |                                           | Warrants Exercisable
|----------- |  | -------------------- | ---- | ------------------------- |  | ----------------------------------------- | --------------------
|Year Issued |  | Exercise Price       |      | Number Shares Outstanding |  | Weighted Average Contractual Life (Years) |                     
|2005        |  | $                    | 0.30 |                           |  | 348,000                                   |                     
|2006        |  | $                    | 1.00 |                           |  | 6,684,960                                 |                     
|2006        |  | $                    | 0.72 |                           |  | 234,690                                   |                     

17





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007




Note
 9  Warrants (continued)



|                                                         |  | Number of Shares |           | Weighted AverageExercise Price |  
|-------------------------------------------------------- |  | ---------------- | --------- | ------------------------------ | -
|                                                         |  |                  |           |                                |  
|Outstanding at December 31, 2004                         |  |                  |          |                                | $
|                                                         |  |                  |           |                                |  
|Granted                                                  |  |                  | 348,000   |                                | $
|Exercised                                                |  |                  |          |                                | $
|Cancelled                                                |  |                  | (        | )                              | $
|Outstanding at December 31, 2005                         |  |                  | 348,000   |                                | $
|                                                         |  |                  |           |                                |  
|Granted                                                  |  |                  | 6,919,650 |                                | $
|Exercised                                                |  |                  |          |                                | $
|Cancelled                                                |  |                  |           |                                | $
|Outstanding at December 31, 2006, 2007 and June 30, 2008 |  |                  | 7,267,650 |                                | $

18





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007




Note
 10  Options

The
 options issued under the Option Grant Program are intended to be either incentive stock options or non-statutory stock options exempt
 from Code Section 409A. Gil Burciaga earned 4,500,000 stock options on the signing date of his contract with the Company. And 150,000
 stock options were earned as of June 30, 2008.

|            |  | Options Outstanding |      |                           |  |                                           | Options Exercisable
|----------- |  | ------------------- | ---- | ------------------------- |  | ----------------------------------------- | -------------------
|Year Issued |  | Exercise Price      |      | Number Shares Outstanding |  | Weighted Average Contractual Life (Years) |                    
|2008        |  | $                   | 0.20 |                           |  | 4,650,000                                 |                    
|            |  |                     |      |                           |  |                                           |                    
|            |  |                     |      |                           |  |                                           |                    



Note
 10  Options - continued



|                                                   |  | Number of Shares |           | Weighted AverageExercise Price |  
|-------------------------------------------------- |  | ---------------- | --------- | ------------------------------ | -
|                                                   |  |                  |           |                                |  
|Outstanding at December 31, 2007                   |  |                  |          |                                | $
|                                                   |  |                  |           |                                |  
|Granted                                            |  |                  | 4,500,000 |                                | $
|Exercised                                          |  |                  |          |                                | $
|Cancelled                                          |  |                  | (        | )                              | $
|Outstanding at June 30, 2008                       |  |                  | 4,500,000 |                                | $
|                                                   |  |                  |           |                                |  
|Granted                                            |  |                  | 150,000   |                                | $
|Exercised                                          |  |                  |          |                                | $
|Cancelled                                          |  |                  |           |                                | $
|Outstanding at December 31, 2007 and June 30, 2008 |  |                  | 4,650,000 |                                | $



Note
 11 - Agreements

On
 June 13, 2008 Providence entered into a four-year employment agreement, effective May 1, 2007, with Gilbert Burciaga, our chief
 executive officer, chief financial officer, principal accounting officer and one of our directors. The agreement includes an annual
 base salary of $150,000 and up to 16,187,500 stock options based on certain criteria. These options include 1,850,000 Incentive Stock
 Options 5,650,000 Tenure Stock Options, and 8,687,500 Performance Stock Options.

On
 June 5, 2008, the Company entered into an option agreement with Elm Ridge Exploration Company, LLC (Elm Ridge). Under the
 terms of the agreement, Elm Ridge has paid a non-refundable $100,000 for the right to a 30-day option to acquire 50% interest in the
 Val Verde Prospect. Working closely with Bill Purves, Elm Ridge will preform a title review of the prospect leases and lead a process
 to further understand the costs and technical requirements for the drilling of this prospect. Elm Ridge and Providence will develop a
 mutually accepted set of agreements covering the purchase and sale of a 50% interest in the prospects. Subsequent to the period ended
 June 30, 2008, the Company closed a purchase and sale agreement with Elm Ridge (see Note 14).

Note
 12  Commitments and Contingencies



The
 royalty on the Companys Val Verde property is 25% of net revenue. In addition, the Company must make annual installments for
 property leases in the amounts of $2,858 on each February 24 and $320 on each April 13.



19





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 13  Recent Accounting Pronouncements

The
 Financial Accounting Standards Board (FASB) has issued Statement of Financial Accounting Standards (SFAS) No.
 163, Accounting for Financial Guarantee Insurance Contracts. SFAS No. 163 clarifies how SFAS No. 60, Accounting and Reporting by
 Insurance Enterprises, applies to financial guarantee insurance contracts issued by insurance enterprises, and addresses the
 recognition and measurement of premium revenue and claim liabilities. It requires expanded disclosures about contracts, and
 recognition of claim liability prior to an event of default when there is evidence that credit deterioration has occurred in an
 insured financial obligation. It also requires disclosure about (a) the risk-management activities used by an insurance enterprise to
 evaluate credit deterioration in its insured financial obligations, and (b) the insurance enterprise's surveillance or watch list.
 The Company is currently evaluating the impact of SFAS No. 163.

In
 May 2008, FASB issued FASB Staff Position (FSP) APB 14-1, Accounting for Convertible Debt Instruments That May Be
 Settled in Cash upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1). FSP APB 14-1 clarifies that
 convertible debt instruments that may be settled in cash upon either mandatory or optional conversion (including partial cash
 settlement) are not addressed by paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt and Debt issued with
 Stock Purchase Warrants.  Additionally, FSP APB 14-1 specifies that issuers of such instruments should separately
 account for the liability and equity components in a manner that will reflect the entitys nonconvertible debt borrowing rate
 when interest cost is recognized in subsequent periods. FSP APB 14-1 is effective for financial statements issued for fiscal years
 beginning after December 15, 2008, and interim periods within those fiscal years. We will adopt FSP APB 14-1 beginning in the
 first quarter of 2009, and this standard must be applied on a retrospective basis. We are evaluating the impact the adoption of FSP
 APB 14-1 will have on our consolidated financial position and results of operations.

On
 May 8, 2008, FASB issued SFAS No. 162, The Hierarchy of Generally Accepted Accounting Principles, which will provide framework for
 selecting accounting principles to be used in preparing financial statements that are presented in conformity with U.S. generally
 accepted accounting principles (GAAP) for nongovernmental entities. With the issuance of SFAS No. 162, the GAAP hierarchy for
 nongovernmental entities will move from auditing literature to accounting literature.  The Company is currently assessing the impact
 SFAS No. 162will have onits financial position and
 results of operations.

In
 April 2008, the FASB issued FSP No. 142-3, Determination of the Useful Life of Intangible Assets (FSP 142-3).
 FSP 142-3 amends the factors an entity should consider in developing renewal or extension assumptions used in determining the useful
 life of recognized intangible assets under FASB Statement No. 142, Goodwill and Other Intangible Assets. This new
 guidance applies prospectively to intangible assets that are acquired individually or with a group of other assets in business
 combinations and asset acquisitions. FSP 142-3 is effective for financial statements issued for fiscal years and interim periods
 beginning after December 15, 2008. Early adoption is prohibited. We are currently evaluating the impact, if any, that FSP 142-3 will
 have on our consolidated financial statements.

20





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 13  Recent Accounting Pronouncements (continued)

In
 March 2008, FASB issued SFAS 161 which amends and expands the disclosure requirements of SFAS 133 to provide an enhanced
 understanding of an entitys use of derivative instruments, how they are accounted for under SFAS 133 and their effect on the
 entitys financial position, financial performance and cash flows. The provisions of SFAS 161 are effective for the period
 beginning after November 15, 2008. The Company is currently reviewing the effect, if any, that the adoption of this statement will
 have on the Companys financial statements.

In
 December 2007, FASB issued SFAS No. 141 (revised), Business Combinations. This revision statements objective is to improve the
 relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its effects on
 recognizing identifiable assets and measuring goodwill.SFAS No. 141 (revised) becomes
 effective beginning with our first quarter 2009 fiscal period. We are currently evaluating the impact of this standard on our
 Consolidated Financial Statements.



Note
 14 Subsequent Events

Subsequent
 to the period, Providence Exploration entered into a prospect participation and joint operating agreement on July 31, 2008 with Elm
 Ridge, whereby Elm Ridge acquired a 50% interest in the Val Verde leases at the close of the agreement on August 8, 2008. Under the
 agreement the Company received a payment of $7,212,000 (including a credit for the $100,000 paid as a non-refundable option) and will
 be carried on the first two Ellenberger wells by Elm Ridge for $2,000,000.
 The Company and Elm Ridge have further agreed to hire R.K. Ford & Associates, Inc., for the initial drilling program.
 Theunaudited pro forma consolidated balance sheet and
 statement of operations for this transaction with their accompanying notes for the periods
 ended December 31, 2007 and June 30, 2008 are below.



21





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


|Note 14 Subsequent Events - continuedPro Forma Balance Sheet
As of December 31, 2007 (Unaudited)ASSETS
|-------------------------------------------------------------------------------------------------------
|                                                                                                       
|Current Assets                                                                                         
|Cash                                                                                                   
|Prepaid                                                                                                
|Note Receivable                                                                                        
|Total current assets                                                                                   
|Property and equipment (net)                                                                           
|                                                                                                       
|Other Assets                                                                                           
|Loan Origination Fees                                                                                  
|Total other assets                                                                                     
|Total assets                                                                                           
|                                                                                                       
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                                   
|                                                                                                       
|Current Liabilities                                                                                    
|Accounts payable and accruals                                                                          
|Accrued Expenses                                                                                       
|Related Party Payables                                                                                 
|Short Term Convertible- Promissory Note                                                                
|Current Portion of Long Term Debt                                                                      
|Notes payable - Short Term                                                                             
|Total current liabilities                                                                              
|                                                                                                       
|Long-Term Liabilities                                                                                  
|Long Term Convertible- Promissory Note                                                                 
|Notes payable - Long Term                                                                              
|Convertible debenture                                                                                  
|Total long-term liabilities                                                                            
|                                                                                                       
|Total Liabilities                                                                                      
|                                                                                                       
|Commitments and Contingencies                                                                          
|Minority Interest in Net Asset of Subsidiary                                                           
|                                                                                                       
|Stockholders' Equity                                                                                   
|Preferred stock, ($0.0001 par value), 25,000,000                                                       
|shares authorized, none issued                                                                         
|Common stock, $0.0001 par value, 250,000,000 shares                                                    
|authorized, 59,161,118 shares issued and outstanding                                                   
|Additional paid-in-capital                                                                             
|Deficit accumulated during the exploration stage                                                       
|Accumulated other comprehensive deficit                                                                
|Total stockholders' equity                                                                             
|                                                                                                       
|Total liabilities and stockholders' equity                                                             
|                                                                                                       
|(a)  Cash received for sale of 50% of leasehold interest.  Gain on sale of Asset is $1,155,008         

22





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007







|Note 14 Subsequent Events - continuedPro Forma Statement of Operations                       
|----------------------------------------------------------------------------------------------
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Revenue                                                                                       
|                                                                                              
|Expenses                                                                                      
|                                                                                              
|General and Administrative                                                                    
|                                                                                              
|Total operating expenses                                                                      
|                                                                                              
|Income/(loss) from operations                                                                 
|                                                                                              
|Other Income (Expense)                                                                        
|                                                                                              
|Interest expense                                                                              
|Debt Conversion Expense                                                                       
|Interest Income                                                                               
|Gain on Sale of Property                                                                      
|Loss on Disposal of Assets                                                                    
|Impairment on Capital Asset                                                                   
|                                                                                              
|Total other expense                                                                           
|                                                                                              
|Minority Interest                                                                             
|                                                                                              
|Income/(loss) before income taxes                                                             
|                                                                                              
|Provision for income taxes                                                                    
|                                                                                              
|Net Income/(loss)                                                                             
|                                                                                              
|Loss per share - basic and diluted                                                            
|                                                                                              
|Weighted average shares outstanding -                                                         
|Basic and diluted                                                                             
|                                                                                              
|(a)  Cash received for sale of 50% of leasehold interest.  Gain on sale of Asset is $1,155,008

23





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 14 Subsequent Events - continued



Notes
 to Pro Forma Consolidated Financial Statements

December
 31, 2007 (Unaudited)



Basisof
 Presentation



The
 unaudited pro forma consolidated financial statements give effect to the sale
 of leasehold interest ofthe Company
 completed with an effective date of July 31, 2008, to
 Elm Ridge.  SeeSale
 of Leasehold Interest below.
 The unaudited pro forma consolidated financial statements have been prepared by management using the accounting principles disclosed
 in the consolidated financial statements ofthe Company
 for the year ended December 31, 2007 as if the transaction described in note 2 had occurred on
 January 1, 2007 with respect to the pro forma consolidated statement of operations for the year ended December 31, 2007.

The
 unaudited pro forma consolidated balance sheet as of June 30, 2008 and the statement of operations for the six-month period ended
 June 30, 2008 are based on the unaudited interim consolidated financial statements ofthe
 Company for the six-month period ended June 30, 2008; and



The
 unaudited pro forma consolidated statement of operations for the year ended December 31, 2007 is based on the audited consolidated
 financial statements ofthe Company for the year ended
 December 31, 2007.



The
 unaudited pro forma consolidated balance sheet and statements of operations are not necessarily indicative of the results of
 operations that would have been realized for the periods presented, nor do they purport to project the results of operations ofthe
 Company for any future periods.  The statements of operations do not include expected benefits
 and cost savings. The unaudited pro forma consolidated financial statements should be read in conjunction with the
 consolidated financial statements ofthe Company as at
 and for the year ended December 31, 2007, the interim unaudited consolidated financial statements ofthe
 Company for the six-month period ended June 30, 2008.

Sale
 Of Leasehold Interest



On July
 31, 2008,the Company sold 50% of 8/8 leasehold interest
 in the Val Verde Leases toElm Ridge
 pursuant to which Elm Ridge
 will purchase the Subject Property for $7,212,800.The Company
 andElm Ridge agree that
 the $100,000 previously paid byElm Ridge as an option
 on the Leases will be credited against the purchase price.



Pro
 Forma Adjustments



This
 has been accounted for as a sale
 of assets ofthe Company
 toElm Ridge, which
 results in a decrease of $6,057,792 inOil
 and gas leases-undeveloped, an increase of $7,212,800 in cash,
 and a gain on sale of assets of $1,155,008.  There was a change in income of $1,155,008 to the Income
 Statement and accumulated deficit at the balance sheet date.



24





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


|Note 14 Subsequent Events  continuedPro Forma Balance Sheet
As of June 30, 2008 (Unaudited)ASSETS
|---------------------------------------------------------------------------------------------------
|                                                                                                   
|Current Assets                                                                                     
|Cash                                                                                               
|Note Receivable                                                                                    
|Total current assets                                                                               
|Property and equipment (net)                                                                       
|Total assets                                                                                       
|                                                                                                   
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                               
|                                                                                                   
|Current Liabilities                                                                                
|Accounts payable and accruals                                                                      
|Accrued Expenses                                                                                   
|Related Party Payables                                                                             
|Total current liabilities                                                                          
|                                                                                                   
|Long-Term Liabilities                                                                              
|Long Term Convertible- Promissory Note                                                             
|Notes payable - Long Term                                                                          
|Convertible debenture                                                                              
|Total long-term liabilities                                                                        
|                                                                                                   
|Total Liabilities                                                                                  
|                                                                                                   
|Commitments and Contingencies                                                                      
|Minority Interest in Net Asset of Subsidiary                                                       
|                                                                                                   
|Stockholders' Equity                                                                               
|Preferred stock, ($0.0001 par value), 25,000,000 shares authorized,                                
|none issued                                                                                        
|Common stock, $0.0001 par value, 250,000,000 shares authorized,                                    
|60,261,118 shares issued and outstanding                                                           
|                                                                                                   
|Additional paid-in-capital                                                                         
|Deficit accumulated during the exploration stage                                                   
|Accumulated other comprehensive deficit                                                            
|                                                                                                   
|Total stockholders' equity                                                                         
|                                                                                                   
|Total liabilities and stockholders' equity                                                         
|                                                                                                   
|                                                                                                   
|(a)  Cash received for sale of 50% of leasehold interest.  Gain on sale of Asset is $1,155,008     

25





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


|Note 14 Subsequent Events - continuedPro Forma Statement of Operations                       
|----------------------------------------------------------------------------------------------
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Revenue                                                                                       
|                                                                                              
|Expenses                                                                                      
|                                                                                              
|General and Administrative                                                                    
|                                                                                              
|Total operating expenses                                                                      
|                                                                                              
|Income/(loss) from operations                                                                 
|                                                                                              
|Other Income (Expense)                                                                        
|                                                                                              
|Interest expense                                                                              
|Debt Conversion Expense                                                                       
|Interest Income                                                                               
|Gain on sale of Asset                                                                         
|Non refundable Option                                                                         
|Impairment of Capital assets                                                                  
|                                                                                              
|Total other expense                                                                           
|                                                                                              
|Income/(loss) before income taxes                                                             
|                                                                                              
|Provision for income taxes                                                                    
|                                                                                              
|Net loss                                                                                      
|                                                                                              
|Loss per share - basic and diluted                                                            
|                                                                                              
|Weighted average shares outstanding -                                                         
|Basic and Diluted                                                                             
|                                                                                              
|                                                                                              
|                                                                                              
|(a)  Cash received for sale of 50% of leasehold interest.  Gain on sale of Asset is $1,155,008



26





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Note
 14 Subsequent Events - continued



Notes
 to Pro Forma Consolidated Financial Statements

June
 30, 2008 (Unaudited)



Basisof
 Presentation

The
 unaudited pro forma consolidated financialstatements give effect to the sale
 of leasehold interest ofthe Company
 completed with an effective date of July 31, 2008to
 Elm Ridge.  SeeSale
 of Leasehold Interest
 below.  The unaudited pro forma consolidated financial
 statements have been prepared by management using the accounting principles disclosed in the consolidated financial statements ofthe
 Company for the quarter ended June 30, 2008 as if the transaction described in note 2 had
 occurred on January 1, 2008 with respect to the pro forma consolidated statement of operations for the quarter ended June 30, 2008.

The
 unaudited pro forma consolidated balance sheet as of June 30, 2008 and the statement of operations for the six-month period ended
 June 30, 2008 are based on the unaudited interim consolidated financial statements ofthe
 Company for the six-month period ended June 30, 2008; and



The
 unaudited pro forma consolidated statement of operations for the quarter ended June 30, 2008 is based on the audited consolidated
 financial statements ofthe Company for the quarter
 ended June 30, 2008.



The
 unaudited pro forma consolidated balance sheet and statements of operations are not necessarily indicative of the results of
 operations that would have been realized for the periods presented, nor do they purport to project the results of operations ofthe
 Company for any future periods.  The statements of operations do not include expected benefits
 and cost savings. The unaudited pro forma consolidated financial statements should be read in conjunction with the
 consolidated financial statements ofthe Company as at
 and for the quarter ended June 30, 2008 the interim unaudited consolidated financial statements ofthe
 Company for the six-month period ended June 30, 2008.

Sale
 Of Leasehold Interest



On July
 31, 2008,the Company sold 50% of 8/8 leasehold interest
 in the Val Verde Leases toElm Ridge
 pursuant to whichElm Ridge
 will purchase the Subject Property for $7,212,800.The Company
 and Elm Ridge agree that
 the $100,000 previously paid byElm Ridge as an option
 on the Leases will be credited against the purchase price.

Pro
 Forma Adjustments



This
 has been accounted for as a sale
 of assets ofthe Company
 toElm Ridge, which
 results in a decrease of $6,057,792 in Oil and gas leases-undeveloped, an increase of $7,112,800 in cash,
 and a gain on sale of assets of $1,055,008.  There was also a decrease to non refundable option of
 $100,000 which was credited toward the purchase.  There was a change in income of $1,055,008 to the Income Statement and accumulated
 deficit at the balance sheet date.



End
 of Notes to Financial Statements

27





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Supplemental
 Oil and Gas Information  FAS69



The
 following unaudited disclosures on standardized measures of discounted cash flows and changes therein relating to proved oil and gas
 reserves are determined in accordance with United States Statements of Financial Accounting Standards No. 69 Disclosures About
 Oil and Gas Producing Activities.



Standardized
 Measure of Discounted Future Net Cash Flows and Changes Therein



In
 calculating the standardized measure of discounted future net cash flows, year-end constant prices and cost assumptions were applied
 to the Companys annual future production from proved reserves to determine cash inflows. Future production and development
 costs are based on constant price assumptions and assume the continuation of existing economic, operating and regulatory conditions.
 Future income taxes are calculated by applying statutory income tax rates to future pre-tax cash flows after provision for the tax
 cost of oil and natural gas properties based upon existing laws and regulations.  The discount was computed by application of a 10
 percent discount factor to the future net cash flows. The calculation of the standardized measure of discounted future net cash flows
 is based upon discounted future net cash flows prepared by the Companys independent qualified reserve evaluators in relation to
 the reserves they respectively evaluated, and adjusted by the Company to account for managements estimate obligations and
 future income taxes.  The Company cautions that the discounted future net cash flows relating to proved oil and gas reserves are an
 indication of neither the fair market value of the Companys oil and gas properties, nor of the future net cash flows expected
 to be generated from such properties. The discounted future net cash flows do not include the fair market value of exploratory
 properties and probable or possible oil and gas reserves, nor is consideration given to the effect of anticipated future changes in
 crude oil and natural gas prices, development, asset retirement and production costs, and possible changes to tax and royalty
 regulations. The prescribed discount rate of 10 percent may not appropriately reflect future interest rates.  The Companys
 projections should not be interpreted as being equivalent to fair market value.



Net
 Proved Reserves(1, 2)

|                                    | Natural Gas(millions of cubic feet) |  | Crude Oil and Natural Gas Liquids(thousands of barrels)
|----------------------------------- | ----------------------------------- |  | -------------------------------------------------------
|December 31, 2006                   | -                                   |  | -                                                      
|Purchase of reserves in place       | -                                   |  | -                                                      
|Production                          | -                                   |  | -                                                      
|Adjustment for uneconomic wells     | -                                   |  | -                                                      
|December 31, 2007 and June 30, 2008 | -                                   |  | -                                                      
|                                    |                                     |  |                                                        
|Developed                           | -                                   |  | -                                                      
|Undeveloped                         | -                                   |  | -                                                      
|Total                               | -                                   |  | -                                                      

28





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007




Supplemental
 Oil and Gas Information  FAS69 (continued)



| | (1) | Definitions:
| | --- | ------------

a.     Net
 reserves are the remaining reserves of the Company, after deduction of estimated royalties and including royalty interests.

b.     Proved
 oil and gas reserves.Proved oil and gas reserves are the estimated quantities of
 crude oil, natural gas, and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be
 recoverable in future years from known reservoirs under existing economic

and operating
 conditions, i.e. prices and costs as of the date the estimate is made. Prices include consideration of changes in existing prices
 provided only by contractual arrangements, but not on escalations based upon future conditions.



Reservoirs
 are considered proved if economic product ability is supported by either actual production or conclusive formation test.  The area of
 a reservoir considered proved includes that portion delineated by drilling and defined by gas-oil and /or oil-water contacts, if any;
 and the immediately adjoining portions not yet drilled, but which can be reasonably judged as economically productive on the basis of
 available geological and engineering data.  In the absence of information on fluid contacts, the lowest known structural occurrence
 of hydrocarbons controls the lower proved limit of the reservoir.



| | i. | Reserves which can be produced economically through application of improved recovery techniques (such as fluid injection) are included in the proved classification when successful testing by a pilot project, or the operation of an installed program in the reservoir, provides support for the engineering analysis on which the project or program was based.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | ii. | Estimates of proved reserves do not include the following:
| | --- | ----------------------------------------------------------



Oil that may become
 available from known reservoirs but is classified separately as indicated additional reserves; Crude oil,
 natural gas, and natural gas liquids, the recovery of which is subject to reasonable doubt because of uncertainty as to geology,
 reservoir characteristics, or economic factors;



Crude oil, natural gas,
 and natural gas liquids, that may occur in undrilled prospects; and  Crude oil, natural gas, and natural gas liquids,
 thatmay be recovered from oil shale, coal, gilsonite
 and other such sources.



29





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007


Supplemental
 Oil and Gas Information  FAS69 (continued)



c.     Proved
 developed oil and gas reserves.Proved developed oil and gas reserves are reserves
 that can be expected to be recovered through existing wells with existing equipment and operating methods.  Additional oil and gas
 expected to be obtained through the application of fluid injection or other improved recovery techniques for supplementing the
 natural forces and mechanisms of primary recovery should be included as proved developed reserves only after testing by a
 pilot project or after the operation of an installed

program has confirmed
 through production response that increased recovery will be achieved.



d.     Proved
 undeveloped reserves.Proved undeveloped oil and gas reserves are reserves that are
 expected to be recovered from new wells on undrilled acreage, or from existing wells where a relatively major expenditure is required
 for recompletion.  Reserves on undrilled acreage shall be limited to those drilling units offsetting productive unites that are
 reasonably certain of production when drilled.  Proved reserves for other undrilled unites can be claimed

only
 where it can be demonstrated with certainty that there is continuity of production from the existing productive formation.  Under no
 circumstances should estimates, for proved undeveloped reserves be attributable to any acreage for which an application of fluid
 injection or other improved recovery technique is contemplated, unless such techniques have been proved effective by actual tests in
 the area and in the same reservoir.



(2)
 The Company does not file any estimates of total net proved crude oil or natural gas reserves with any U.S. federal authority or
 agency other than the SEC.



Standardized
 Measure of Discounted Future Net Cash Flows Related to Proved Oil and Gas Reserves

The
 Company has no proved reserves and no oil and gas production and therefore has not presented the Standardized Measure of Discounted
 Future Net Cash Flows or operating results.



Capitalized
 Costs

|June 30, 2008                   | United States      
|------------------------------- | -------------------
|Proved oil and gas properties   | $                 -
|Unproved oil and gas properties | 12,115,585         
|Total capital costs             | 12,115,585         
|Accumulated depletion           |                    
|Net capitalized costs           | $     12,115,585   

30





PROVIDENCE RESOURCES INC. (An ExploratoryStage Company)NOTES TO CONSOLIDATED
FINANCIAL STATEMENTSJune 30, 2008 and 2007




Supplemental
 Oil and Gas Information  FAS69 (continued)



Costs
 Incurred

|                             | United States    
|---------------------------- | -----------------
|Years ended June 30, 2008    |                  
|Acquisitions:                |                  
|Proved reserves              | $               -
|Unproved reserves            | -                
|Total acquisitions           | -                
|Exploration costs            | -                
|Development costs            | -                
|Asset retirement obligations | -                
|Total costs incurred         | $               -



31





Item
 2.MANAGEMENTS DISCUSSION AND ANALYSIS
 OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS



ThisManagements
 Discussion and Analysis of Financial Condition and Results of Operations
 and other parts of this quarterly report contain forward-looking statements that involve risks and
 uncertainties. Forward-looking statements can be identified by words such as anticipates, expects, believes,
 plans, predicts, and similar terms. Forward-looking statements are not guarantees of future performance and
 our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause
 such differences include but are not limited to those discussed in the subsection entitledForward-Looking
 Statements and Factors That May Affect Future Results and Financial Condition below. The
 following discussion should be read in conjunction with our financial statements and notes thereto included in this report. Our
 fiscal year end is December 31. All information presented herein is based on the three and six month periods ended June 30, 2008.



Discussion
 and Analysis



The
 Company is involved in oil and gas exploration through its wholly owned subsidiary, Providence Exploration, LLC (Providence
 Exploration) in Val Verde County, Texas.



Val
 Verde County



The
 Companys interests in Val Verde County include 12,832 acres of oil and gas leases containing multiple target zones within a
 large structure delineated by prior seismic and drilling in the area. The Val Verde leases lie along a trend that has produced from
 multiple large gas fields, including the Gomez field, which has produced 10.6 trillion cubic feet to date, the Brown Bassett, which
 has produced 1.6 trillion cubic feet to date, and the JM Field, which has produced 650 billion cubic feet to date.



In
 2007 we performed an extensive 3D-seismic acquisition program on our Val Verde leases, supervised and interpreted by TRNCO Petroleum
 Corporation of Midland, Texas. From these results we have identified about 25 drilling targets. Our initial two well drilling program
 will target the Ellenberger formation at a depth of around 16,000 feet. Drilling is scheduled to begin on or before October 1, 2008.



On
 June 5, 2008, the Company entered into an option agreement with Elm Ridge Exploration Company, LLC (Elm Ridge) of New
 Mexico. Under the terms of the agreement, Elm Ridge paid a non-refundable fee of $100,000 for the right to a 30-day option to acquire
 a 50% interest in the Val Verde leases. On July 31, 2008 Providence Exploration signed a prospect participation and joint operating
 agreement with Elm Ridge entitling Elm Ridge to acquire a 50% interest in the Val Verde leases. On August 8, 2008 the prospect
 participation and joint operating agreement closed on the Companys receipt of $7,212,000 (including a credit for the $100,000
 paid as a non-refundable option) and Elm Ridges commitment to carry the Company for $2,000,000 on the first two Ellenberger
 wells. The Company and Elm Ridge have further agreed to hire R.K. Ford & Associates, Inc., a Midland Texas based drilling and
 completion company, for the initial drilling program.

Comanche
 and Hamilton Counties



The
 Companys interests in Comanche and Hamilton Counties included 7,374 acres of oil and gas leases. Seismic work was completed on
 the leases in 2006 to identify prospective drill targets. Harding Company drilled four wells none of which wells indicated commercial
 quantities of gas. All four wells have now been abandoned and these leases which have been fully impaired at June 30, 2008.



32





Additional
 Discussion and Analysis



The
 Companys business development strategy is prone to significant risks and uncertainties certain of which could have an immediate
 impact on its efforts to generate a positive net cash flow and could deter the anticipated expansion of its initial drilling program.
 Historically, the Company has not generated sufficient cash flow to sustain operations and has had to rely on debt or equity
 financing to remain in business. Therefore, we cannot offer that future expectations of oil and gas production will prove correct or
 that any production realized will be sufficient to generate the revenue required for our continued operation. Should we be unable to
 generate sufficient cash flow from our anticipated drill program, the Company may be forced to sell assets or seek additional debt or
 equity financing, as alternatives to the cessation of operations. The success of such measures can in no way be assured.



Results
 of Operations



During
 the six months ended June 30, 2008, the Company was involved in evaluating seismic data obtained from the Val Verde leases,
 identifying prospective partners for the prospective drilling program, addressing outstanding issues related to the Hamilton and
 Comanche exploration and development program, concluding an option agreement with Elm Ridge in anticipation of concluding the
 prospect participation and joint operating agreement, and satisfying continuous public disclosure requirements.



While
 we expect to begin oil and gas drilling operations on our Val Verde leases on or before October 1, 2008, we can provide no assurance
 that such operations will produce economically recoverable quantities of oil and gas.

Net
 LossesFor the period from inception until June 30, 2008, the Company
 incurred net losses of $42,976,663. Net losses for the three month period ended June 30, 2008 were $3,861,457 as compared to $731,243
 for the three month period ended June 30, 2007. Net losses for the six month period ended June 30, 2008 were $4,857,704 as compared
 to $1,008,817 for the six month period ended June 30, 2007. The increase in net losses over the comparative periods can be primarily
 attributed to an increase in general and administrative expenses, interest expenses, and an impairment of capital assets. We have not
 generated any revenue during the current period. We will likely continue to operate at a loss through fiscal 2008 and due
 to the nature of the Companys oil and gas exploration and development operations cannot determine whether we will ever generate
 revenues from operations.

ExpensesGeneral
 and administrative expenses for the three month period ended June 30, 2008 were $1,169,258 as compared to $292,539 for the three
 month period ended June 30, 2007. General and administrative expenses for the six month period ended June 30, 2008 were $1,357,277 as
 compared to $513,008 for the six month period ended June 30, 2007. The increase in general and administrative expenses over the
 comparative periods can be primarily attributed to the expense related to the grant of stock options to our executive officer. We
 expect general and administrative expenses to decrease in future periods.

33





Other
 Income (Expenses)



Other
 expenses for the three month period ended June 30, 2008 were $2,692,199 as compared to $438,704 for the three month period ended June
 30, 2007. Other expenses for the six month period ended June 30, 2008 were $3,500,427 as compared to $495,809 for the six month
 period ended June 30, 2007. The increase in other expenses over the comparative periods can be attributed to the increase in interest
 expense as well as the $2,000,000 impairment on our oil and gas leases Comanche and Hamilton Counties offset by the $100,000
 non-refundable option payment received from Elm Ridge.

Income
 Tax Expense (Benefit)



The
 Company has a prospective income tax benefit resulting from a net operating loss carryforward and start up costs that will offset any
 future operating profit.



Impact
 of Inflation



The
 Company believes that inflation has had an effect on operations due to the increased interest in oil and gas exploration over the
 last three years which has increased prices for labor, maintenance services and equipment. We believe that we can offset inflationary
 increases by improving operating efficiencies.



Capital
 Expenditures



The
 Company has spent significant amounts on capital expenditures for the period from February 17, 1993 (inception) to June 30, 2008 on
 unproved oil and gas properties, pipeline construction, and related exploration costs.



Liquidity
 and Capital Resources

The
 Company has been in theexplorationstage since
 inception and has experienced significant changes in liquidity, capital resources, and stockholders equity. At June
 30, 2008, the companys working capital deficit was $685,386. The Company had current assets of $1,358,091 as of June 30, 2008
 which consisted of cash on hand of $1,108,091 and a note receivable of $250,000. We had total assets of $13,473,676 which included
 undeveloped oil and gas leases. Our current liabilities were $2,043,477, including accounts payable of $1,082,969, accrued expenses
 of $877,508, and related party payables of $83,000. Our total liabilities were $8,012,767, including convertible debentures of
 $3,320,000, convertible promissory notes of $1,949,290, and notes payable of $700,000. Stockholders equity in the Company was
 $5,309,936 as of June 30, 2008.  For the period from inception until June 30, 2008, the Companys cash flow used in
 operating activities was $4,543,392. Cash flows used in operating activities for the six month period ended June 30, 2008 were
 $157,484 compared to cash flows provided by operating activities of $51,464 for the six month period ended June 30, 2007. The cash
 flows used in operating activities during the current period is due primarily to net losses and related party payables. Depreciation
 and amortization for the six month periods ended June 30, 2008 and 2007 was $2,020,399
 and $16,200 respectively. For the period from inception until June 30, 2008, the Companys
 cash flow used in investing activities was $17,582,021. Cash flows provided by investing activities for the six month period ended
 June 30, 2008 were $100,000 compared to cash flows used in investing activities of $3,835,697 for the six month period ended June 30,
 2007. Cash flows provided by investing activities in the current period are from cash collected from a note receivable in connection
 with the sale of a rig and related equipment.34




For the period from inception until June 30, 2008, the Companys cash flow
 provided by financing activities was $23,233,504. Cash flows provided by financing activities for the six month period ended June 30,
 2008 were $0 compared to $2,700,456 for the six month period ended June 30, 2007.  We have funded our cash needs from
 inception primarily through a series of debt and equity transactions, including several private placements. We do not believe that
 our current assets are sufficient to conduct our exploration and development activities over the next twelve months. No assurances
 can be given that additional funding, needed to explore and develop our lease interests, will be available to us on acceptable terms
 or at all. Our inability to obtain funding would have a material adverse affect on our business.

Cash
 dividends are not expected to be paid in the foreseeable future. The Company had no lines of credit or other bank
 financing arrangements as of June 30, 2008.  Commitments for future capital expenditures to the Companys
 anticipated drill program were material at quarter-end.  The Company has a defined benefit plan and contractual
 commitments with certain of its officers or directors.  The Company has no current plans for the purchase or sale of any
 plant or equipment.  The Company has no current plans to make any changes in the number of employees.



Off
 Balance Sheet Arrangements



As of
 June 30, 2008, the Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future
 effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital
 expenditures, or capital resources that is material to stockholders.



Going
 Concern



The
 Companys audit expressed substantial doubt as to the Companys ability to continue as a going concern due to significant
 losses from operations and dependence on financings to sustain operations. These conditions raise substantial doubt about the Companys
 ability to continue as a going concern.

Our
 ability to continue as a going concern requires that we either realize net income from operations or obtain funding from outside
 sources.  Since our business plan cannot assure revenue within the next twelve months, managements plan to maintain our ability
 to continue as a going concern includes: (i) the private placement of debt or equity; (ii) entering into joint venture agreements to
 fund exploration and development; (iii) realizing prospective oil and gas revenues; (iv) obtaining shareholder loans; and (v)
 converting existing debt to equity.

Although
 management believes that they will be able to obtain the funding necessary for us to continue as a going concern there can be no
 assurances that the anticipated means for maintaining this objective will prove successful.

35







Forward
 Looking Statements and Factors That May Affect Future Results and Financial Condition



The
 statements contained in the section titledManagements Discussion and Analysis of
 Financial Condition and Results of Operations
 and elsewhere in this current report, with the exception of historical facts, are forward looking
 statements. Forward looking statements reflect our current expectations and beliefs regarding our future results of operations,
 performance, and achievements. These statements are subject to risks and uncertainties and are based upon assumptions and beliefs
 that may or may not materialize. These statements include, but are not limited to, statements concerning:

| | · | our anticipated financial performance;
| | - | --------------------------------------

| | · | uncertainties related to oil and gas exploration and development;
| | - | -----------------------------------------------------------------

| | · | our ability to generate revenues through oil and gas production to fund future operations;
| | - | ------------------------------------------------------------------------------------------

| | · | our ability to raise additional capital to fund cash requirements for future operations; and
| | - | --------------------------------------------------------------------------------------------

| | · | the volatility of the stock market and general economic conditions.
| | - | -------------------------------------------------------------------



We wish
 to caution readers that our operating results are subject to various risks and uncertainties that could cause our actual results to
 differ materially from those discussed or anticipated, including the factors set forth in the section entitledRisk
 Factors included elsewhere in this report. We also wish to advise readers not to place any
 undue reliance on the forward looking statements contained in this report, which reflect our beliefs and expectations only as of the
 date of this report. We assume no obligation to update or revise these forward looking statements to reflect new events or
 circumstances or any changes in our beliefs or expectations, other that is required by law.

Stock-Based
 CompensationWe have adopted SFAS
 No. 123 (revised 2004) (SFAS No. 123R), Share-Based Payment, which addresses the accounting for stock-based payment transactions in
 which an enterprise receives employee services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are
 based on the fair value of the enterprises equity instruments or that may be settled by the issuance of such equity
 instruments.  In January 2005, the Securities and Exchange Commission (Commission) issued Staff Accounting Bulletin (SAB) No. 107,
 which provides supplemental implementation guidance for SFAS No. 123R. SFAS No. 123R eliminates the ability to account for
 stock-based compensation transactions using the intrinsic value method under Accounting Principles Board (APB) Opinion No. 25,
 Accounting for Stock Issued to Employees, and instead generally requires that such transactions be accounted for using a
 fair-value-based method. We use the Black-Scholes-Merton (BSM) option-pricing model to determine the fair-value of
 stock-based awards under SFAS No. 123R, consistent with that used for pro forma disclosures under SFAS No. 123, Accounting for
 Stock-Based Compensation. We have elected the modified prospective transition method as permitted by SFAS No. 123R and accordingly
 prior periods have not been restated to reflect the impact of SFAS No. 123R. The modified prospective transition method requires that
 stock-based compensation expense be recorded for all new and unvested stock options, restricted stock, restricted stock units, and
 employee stock purchase plan shares that are ultimately expected to vest as the requisite service is rendered beginning on January 1,
 2006, the first day of our fiscal year 2006.  Stock-based compensation expense for awards granted prior to January 1, 2006 is based
 on the grant date fair-value as determined under the pro forma provisions of SFAS No. 123. Prior to the adoption of SFAS No. 123R, we
 measured compensation expense for our employee stock-based compensation plans using the intrinsic value method prescribed by APB
 Opinion No. 25. We applied the disclosure provisions of SFAS No. 123 as amended by SFAS No. 148, Accounting for Stock-Based
 Compensation  Transition and Disclosure, as if the fair-value-based method had been applied in measuring compensation expense.
 Under APB Opinion No. 25, when the exercise price of the Companys employee stock options was equal to the market price of the
 underlying stock on the date of the grant, no compensation expense was recognized.

36





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



2008
 Stock Option Plan



On
 June 13, 2008, the board of directors approved the Companys 2008 Stock Option Plan (Plan) for which the Company is
 currently seeking stockholder approval. The Plan is intended to promote the interests of Company by providing eligible persons with
 the opportunity to acquire or increase their proprietary interest in the Company as an incentive for them to continue their
 employment or service. The maximum number of shares of common stock that may be issued over the ten (10) year term of the Plan cannot
 exceed twenty five million (25,000,000) shares, two million (2,000,000) of which may be issued as incentive stock options (ISO)
 and twenty three million (23,000,000) may be issued as non-statutory stock options (NSO). Employees are eligible for ISOs
 and NSOs under the Plan. Non-employee members of the board of directors and consultants are eligible for NSOs. If stockholder
 approval is not obtained, no options may be exercised under the Plan. The Company has granted up to 16,187,500 options under the Plan
 to date, pending stockholder approval.



Critical
 Accounting PoliciesIn the notes to the audited consolidated financial
 statements for the Company for the year ended December 31, 2007, the Companys auditors discussed those accounting policies that
 are considered to be significant in determining the results of operations and financial position. The Companys auditors believe
 that their accounting principles conform to accounting principles generally accepted in the United States of America. The
 preparation of financial statements requires management to make significant estimates and judgments that affect the reported amounts
 of assets, liabilities, revenues and expenses. By their nature, these judgments are subject to an inherent degree of uncertainty. On
 an on-going basis, we evaluate our estimates, including those related to bad debts, inventories, intangible assets, warranty
 obligations, product liability, revenue, and income taxes. We base our estimates on historical experience and other facts and
 circumstances that are believed to be reasonable, and the results form the basis for making judgments about the carrying value of
 assets and liabilities. The actual results may differ from these estimates under different assumptions or conditions.

Revenue
 RecognitionRevenues are recorded upon the completion of the services,
 with the existence of an agreement and where collectability is reasonably assured. Oil and natural gas production revenue, if any,
 will be recognized at the time and point of sale after the product has been extracted from the ground.



37





Recent
 Accounting Pronouncements



The
 Financial Accounting Standards Board (FASB) has issued Statement of Financial Accounting Standards (SFAS) No.
 163, Accounting for Financial Guarantee Insurance Contracts. SFAS No. 163 clarifies how SFAS No. 60, Accounting and Reporting by
 Insurance Enterprises, applies to financial guarantee insurance contracts issued by insurance enterprises, and addresses the
 recognition and measurement of premium revenue and claim liabilities. It requires expanded disclosures about contracts, and
 recognition of claim liability prior to an event of default when there is evidence that credit deterioration has occurred in an
 insured financial obligation. It also requires disclosure about (a) the risk-management activities used by an insurance enterprise to
 evaluate credit deterioration in its insured financial obligations, and (b) the insurance enterprise's surveillance or watch list.
 The Company is currently evaluating the impact of SFAS No. 163.

In
 May 2008, FASB issued FASB Staff Position (FSP) APB 14-1, Accounting for Convertible Debt Instruments That May Be
 Settled in Cash upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1). FSP APB 14-1 clarifies that
 convertible debt instruments that may be settled in cash upon either mandatory or optional conversion (including partial cash
 settlement) are not addressed by paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt and Debt issued with
 Stock Purchase Warrants.  Additionally, FSP APB 14-1 specifies that issuers of such instruments should separately
 account for the liability and equity components in a manner that will reflect the entitys nonconvertible debt borrowing rate
 when interest cost is recognized in subsequent periods. FSP APB 14-1 is effective for financial statements issued for fiscal years
 beginning after December 15, 2008, and interim periods within those fiscal years. We will adopt FSP APB 14-1 beginning in the
 first quarter of 2009, and this standard must be applied on a retrospective basis. We are evaluating the impact the adoption of FSP
 APB 14-1 will have on our consolidated financial position and results of operations.

On
 May 8, 2008, FASB issued SFAS No. 162, The Hierarchy of Generally Accepted Accounting Principles, which will provide framework for
 selecting accounting principles to be used in preparing financial statements that are presented in conformity with U.S. generally
 accepted accounting principles (GAAP) for nongovernmental entities. With the issuance of SFAS No. 162, the GAAP hierarchy for
 nongovernmental entities will move from auditing literature to accounting literature.  The Company is currently assessing the impact
 of SFAS No. 162 on its financial position and results of operations.



In
 April 2008, the FASB issued FSP No. 142-3, Determination of the Useful Life of Intangible Assets (FSP 142-3).
 FSP 142-3 amends the factors an entity should consider in developing renewal or extension assumptions used in determining the useful
 life of recognized intangible assets under FASB Statement No. 142, Goodwill and Other Intangible Assets. This new
 guidance applies prospectively to intangible assets that are acquired individually or with a group of other assets in business
 combinations and asset acquisitions. FSP 142-3 is effective for financial statements issued for fiscal years and interim periods
 beginning after December 15, 2008. Early adoption is prohibited. We are currently evaluating the impact, if any, that FSP 142-3 will
 have on our consolidated financial statements.

In
 March 2008, FASB issued SFAS 161 which amends and expands the disclosure requirements of SFAS 133 to provide an enhanced
 understanding of an entitys use of derivative instruments, how they are accounted for under SFAS 133 and their effect on the
 entitys financial position, financial performance and cash flows. The provisions of SFAS 161 are effective for the period
 beginning after November 15, 2008. The Company is currently reviewing the effect, if any, that the adoption of this statement will
 have on the Companys financial statements.

38





ITEM
 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



Not
 required.



ITEM
 4T.     CONTROLS AND PROCEDURES



Evaluation
 of Disclosure Controls and Procedures

In
 connection with the preparation of this report on Form 10-Q/A,
 an evaluation was carried out by the Companys management, with the participation of the chief executive officer and the chief
 financial officer, of the effectiveness of the Companys disclosure controls and procedures (as defined in Rules 13a-15(e) and
 15d-15(e) under the Securities Exchange Act of 1934 (Exchange Act)). Disclosure controls and procedures are designed to
 ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed,
 summarized, and reported within the time periods specified in the Commissions rules and forms and that such information is
 accumulated and communicated to management, including the chief executive officer and the chief financial officer, to allow timely
 decisions regarding required disclosures.

Based
 on that evaluation, the Companys management concluded, as of the end of the period covered by this report, that the Companys
 disclosure controls and procedures were effective in recording, processing, summarizing, and reporting information required to be
 disclosed, within the time periods specified in the Commissions rules and forms, and that such information was accumulated and
 communicated to management, including the chief executive officer and the chief financial officer, to allow timely decisions
 regarding required disclosures.



Changes
 in Internal Control over Financial Reporting



There
 have been no changes in internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the
 period
 ended
 June 30, 2008, that materially affected, or are reasonably likely to
 materially affect, the Companys internal control over financial reporting.



PART
 II  OTHER INFORMATION



ITEM
 1.     LEGAL PROCEEDINGS

None.

ITEM
 1A.     RISK FACTORS

Our
 future operating results are highly uncertain. Before deciding to invest in us or to maintain or increase your investment, you should
 carefully consider the risks described below, in addition to the other information contained in this annual report. If any of these
 risks actually occur, our business, financial condition or results of operations could be seriously harmed. In that event, the market
 price for our common stock could decline and you may lose all or part of your investment.



39





Risks
 Related to the Companys Business



The
 Company has a history of operating losses and such losses may continue in the future.

Since
 the Companys inception in 1993, our operations have resulted in a continuation of losses. We will continue to incur operating
 losses until such time as we begin producing oil and gas revenue, which may or may not eventuate. Should the Company fail to produce
 oil and gas revenue we may continue to operate at a loss and might never become
 profitable.



The
 Company has a history of uncertainty about continuing as a going concern.

The
 Companys audits for the periods ended December 31, 2007 and December 31, 2006 expressed substantial doubt as to its ability to
 continue as a going concern due to our dependence on financings as well the accumulation of significant losses of $38,118,959 as of
 December 31, 2007 which amount increased to $42,976,663 as of June 30, 2008. Unless we are able to overcome our dependence on
 financings and begin to generate revenue from operations, our ability to continue as a going concern will be in jeopardy.

The
 Company has a limited operating history as an oil and gas exploration company.

The
 Company acquired Providence Exploration on September 29, 2006, which company first began oil and gas exploration operations during
 the fourth quarter of 2005. As such, our limited operating history in the oil and gas exploration sector provides an inadequate track
 record from which to base future projections of success.

The
 Company cannot represent that it will be successful in continuing operations.

The
 Company has not, to date, generated revenue from operations and may not generate revenue over the next twelve months. Should the
 Company be unable to realize revenue over the next twelve months, it will be forced to continue to raise capital to remain in
 operation. We have no commitments for the provision of additional capital and can offer no assurance that such capital will be
 available as necessary to sustain operations.

Risks
 Related to the Oil and Gas Industry



Oil
 and natural gas drilling and producing operations involve risks which could result in net losses.

Drilling
 activities are subject to many risks, including the risk that no commercially productive reservoirs will be discovered. Wells which
 we drill may not be productive, and, thus, we may not be able to recover all or any portion of our investment in such wells. Drilling
 for oil and natural gas may involve unprofitable efforts, not only from dry wells, but also from wells that are productive but do not
 produce sufficient net reserves to return a profit after deducting drilling, operating and other costs. The seismic data and other
 technologies which we use do not allow us to know conclusively prior to drilling a well that oil or natural gas is present or may be
 produced economically. The cost of drilling, completing and operating a well is often uncertain, and cost factors can reduce the
 feasibility of a project to produce a profit. Further, our drilling operations may be curtailed, delayed or canceled as a result of
 numerous factors, including:

| | · | unexpected drilling conditions;
| | - | -------------------------------

| | · | title problems;
| | - | ---------------

| | · | pressure or irregularities in formations;
| | - | -----------------------------------------

40





| | · | equipment failures or accidents;
| | - | --------------------------------

| | · | adverse weather conditions;
| | - | ---------------------------

| | · | compliance with environmental and other governmental requirements; and
| | - | ----------------------------------------------------------------------

| | · | cost of, or shortages or delays in the availability of, drilling rigs, equipment and services.
| | - | ----------------------------------------------------------------------------------------------



Our
 operations are subject to all the risks normally incident to the operation and development of oil and natural gas properties and the
 drilling of oil and natural gas wells, including:

| | · | encountering well blowouts;
| | - | ---------------------------

| | · | cratering and explosions;
| | - | -------------------------

| | · | pipe failure;
| | - | -------------

| | · | fires;
| | - | ------

| | · | formations with abnormal pressures resulting in uncontrollable flows of oil and natural gas;
| | - | --------------------------------------------------------------------------------------------

| | · | brine or well fluids; and
| | - | -------------------------

| | · | release of contaminants into the environment and other environmental hazards and risks.
| | - | ---------------------------------------------------------------------------------------



The
 nature of these risks is such that some liabilities including environmental fines and penalties could exceed our ability to pay for
 the damages. We could incur significant costs due to these risks that could result in net losses.

The
 Company is subject to federal, state and local laws and regulations which could create liability for personal injuries, property
 damage, and environmental damages.



Exploration
 and development, exploitation, production and sale of oil and natural gas in the United States is subject to extensive federal, state
 and local laws and regulations, including complex tax laws and environmental laws and regulations. Existing laws or regulations, as
 currently interpreted or reinterpreted in the future, or future laws or regulations could harm the Companys business, results
 of operations and financial condition. We may be required to make large expenditures to comply with environmental and other
 governmental regulations. Matters subject to regulation include oil and gas production and saltwater disposal operations and our
 processing, handling and disposal of hazardous materials, such as hydrocarbons and naturally occurring radioactive materials,
 discharge permits for drilling operations, spacing of wells, environmental protection, reports concerning operations, and taxation.
 Under these laws and regulations, we could be liable for personal injuries, property damage, oil spills, discharge of hazardous
 materials, reclamation costs, remediation, clean-up costs and other environmental damages.

Shortages
 of oil field equipment, services and qualified personnel could reduce the Companys profit margin, cash flow and operating
 results.



The
 demand for qualified and experienced field personnel to drill wells and conduct field operations, geologists, geophysicists,
 engineers and other professionals in the oil and natural gas industry can fluctuate significantly, often in correlation with oil and
 natural gas prices, causing periodic shortages. There have also been shortages of drilling rigs and other equipment, as demand for
 rigs and equipment has increased along with the number of wells being drilled. These factors also cause significant increases in
 costs for equipment, services and personnel. Higher oil and natural gas prices generally stimulate increased demand and result in
 increased prices for drilling rigs, crews and associated supplies, equipment and services. We cannot be certain when or if we will
 experience these issues and these types of shortages or price increases which could significantly decrease any profit margin, cash
 flow and operating results on any particular well or restrict our ability to drill additional wells.

41





The
 results of the Companys current operations depend on the exploration and operational efforts of TRNCO Petroleum Corporation,
 Dawson Geophysical, Fairfield Industries, and certain consultants, all of whom are third parties.



Exploration
 efforts through seismic exploration, processing and interpretation in Val Verde County have been provided by TRNCO Petroleum
 Corporation, Dawson Geophysical, Fairfield Industries, Sam Ting and Bill Purves, while drilling on the leases will be conducted by a
 third party.Exploration and operational efforts through seismic exploration,
 drilling and operation in Comanche and Hamilton Counties were provided by Harding Company.
 Despite being experienced in their respective fields, our dependence on third parties to initiate, determine and conduct operations
 could impede our own prospect of success.



Oil
 and natural gas prices are volatile, and any substantial decrease in prices could cause the Company to continue to operate at a loss
 in the event that we are successful in producing oil and gas.

Our
 future financial condition, results of operations and the carrying value of our oil and natural gas properties will depend primarily
 upon the prices we receive for production. Oil and natural gas prices historically have been volatile and are likely to continue to
 be volatile in the future. Our cash flow from operations will be highly dependent on the prices that we receive for oil and natural
 gas. This price volatility also affects the amount of cash flow available for capital expenditures and our ability to borrow money or
 raise additional capital. The prices for oil and natural gas are subject to a variety of additional factors that are beyond our
 control. These factors include:

| | · | the level of consumer demand;
| | - | -----------------------------

| | · | the domestic supply;
| | - | --------------------

| | · | domestic governmental regulations and taxes;
| | - | --------------------------------------------

| | · | the price and availability of alternative fuel sources;
| | - | -------------------------------------------------------

| | · | weather conditions; and
| | - | -----------------------

| | · | market uncertainty.
| | - | -------------------



These
 factors and the volatility of the energy markets generally make it extremely difficult to predict future oil and natural gas price
 movements with any certainty. Declines in oil and natural gas prices would not only reduce future revenue, but could reduce the
 amount of oil and natural gas that we can produce economically and, as a result, could cause us to continue to operate at a loss.
 Should the oil and natural gas industry experience significant price declines, we may continue to operate at a loss even if we
 produce oil or gas.



Risks
 Related to the Companys Stock



The
 Company will require additional capital funding.

The
 Company will require additional funds, either through equity offerings, debt placements or joint ventures to develop our operations.
 Such additional capital may result in dilution to our current shareholders. Our ability to meet short-term and long-term financial
 commitments depends on future cash. There can be no assurance that future income will generate sufficient funds to enable us to meet
 our financial commitments.



42





The
 market for our stock is limited and our stock price may be volatile.

The
 market for our common stock has been limited due to low trading volume and the small number of brokerage firms acting as market
 makers. Because of the limitations of our market and volatility of the market price of our stock, investors may face difficulties in
 selling shares at attractive prices when they want to. The average daily trading volume for our stock has varied significantly from
 week to week and from month to month, and the trading volume often varies widely from day to day.

We
 incur significant expenses as a result of being quoted on the Over the Counter Bulletin Board, which may negatively impact our
 financial performance.We incur significant legal, accounting and other
 expenses as a result of being listed on the Over the Counter Bulletin Board. The Sarbanes-Oxley Act of 2002, as well as related rules
 implemented by the Commission, has required changes in corporate governance practices of public companies. We expect that compliance
 with these laws, rules and regulations, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 as discussed in the
 following risk factor, may substantially increase our expenses, including our legal and accounting costs, and make some activities
 more time-consuming and costly. As a result, there may be a substantial increase in legal, accounting and certain other expenses in
 the future, which would negatively impact our financial performance and could have a material adverse effect on our results of
 operations and financial condition.



Our
 internal controls over financial reporting may not be considered effective in the future, which could result in a loss of investor
 confidence in our financial reports and in turn have an adverse effect on our stock price.

Pursuant
 to Section 404 of the Sarbanes-Oxley Act of 2002 we are required to furnish a report by our management on our internal controls over
 financial reporting. Such report must contain, among other matters, an assessment of the effectiveness of our internal controls over
 financial reporting as of the end of the year, including a statement as to whether or not our internal controls over financial
 reporting are effective. This assessment must include disclosure of any material weaknesses in our internal controls over financial
 reporting identified by management. If we are unable to continue to assert that our internal controls are effective, our investors
 could lose confidence in the accuracy and completeness of our financial reports, which in turn could cause our stock price to decline.



The
 Companys shareholders may face significant restrictions on their stock.



The
 Companys stock differs from many stocks in that it is a penny stock. The Commission has adopted a number of rules
 to regulate penny stocks including, but not limited to, those rules from the Securities Act as follows:

3a51-1     which
 defines penny stock as, generally speaking, those securities which are not listed on either
 NASDAQ or a national securities exchange and are priced under $5, excluding securities of issuers that have net tangible assets
 greater than $2 million if they have been in operation at least three years, greater than $5 million if in operation less than three
 years, or average revenue of at least $6 million for the last three years;

15g-1     which
 outlines transactions by broker/dealers which are exempt from 15g-2 through 15g-6 as those whose commissions from traders are lower
 than 5% total commissions;

15g-2
      which details that brokers must disclose risks of penny stock on Schedule 15G;

15g-3
      which details that broker/dealers must disclose quotes and other information relating to the penny
 stock market;

15g-4
      which explains that compensation of broker/dealers must be disclosed;

43




15g-5
      which explains that compensation of persons associated in connection with penny stock sales must be
 disclosed;

15g-6
      which outlines that broker/dealers must send out monthly account statements; and

15g-9     which
 defines sales practice requirements.



Since
 the Companys securities constitute a penny stock within the meaning of the rules, the rules would apply to us and
 our securities. Because these rules provide regulatory burdens upon broker-dealers, they may affect the ability of shareholders to
 sell their securities in any market that may develop; the rules themselves may limit the market for penny stocks. Additionally, the
 market among dealers may not be active. Investors in penny stock often are unable to sell stock back to the dealer that sold them the
 stock. The mark-ups or commissions charged by the broker-dealers may be greater than any profit a seller may make. Because of large
 dealer spreads, investors may be unable to sell the stock immediately back to the dealer at the same price the dealer sold the stock
 to the investor. In some cases, the stock may fall quickly in value. Investors may be unable to reap any profit from any sale of the
 stock, if they can sell it at all.



Shareholders
 should be aware that, according to Commission Release No. 34-29093 dated April 17, 1991, the market for penny stocks has
 suffered from patterns of fraud and abuse. These patterns include:

| | · | control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer;
| | - | -----------------------------------------------------------------------------------------------------------------------

| | · | manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases;
| | - | -------------------------------------------------------------------------------------------------------------------

| | · | boiler room practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons;
| | - | -------------------------------------------------------------------------------------------------------------------------------

| | · | excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and
| | - | ------------------------------------------------------------------------------------------

| | · | the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the inevitable collapse of those prices with consequent investor losses.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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



During
 the six months ended June 30, 2008, the Company issued 500,000 shares of common stock to Markus Mueller, in satisfaction of amounts
 due for consulting services. The shares were issued at $0.15 per share, totaling an aggregate of $75,000. Fair value of shares issued
 was $100,000. The remaining $25,000 was recorded as a debt conversion expense. The Company agreed to issue the shares relying on
 exemptions provided by Section 4(2) and Regulation S of the Securities Act of 1933, as amended (Securities Act).

The
 Company complied with the exemption requirements provided by Section 4(2) based on the following factors: (i) the issuance was an
 isolated private transaction by the Company which did not involve a public offering; (ii) there was only one offeree, a director of
 the Company, who was issued the Companys stock for services rendered; (iii) the offeree committed to hold the stock as required
 by applicable securities laws; (iv) there were no subsequent or contemporaneous public offerings of the stock; (v) the stock was not
 broken down into smaller denominations; and (vi) the negotiations that lead to the issuance of the stock took place directly between
 the offeree and the Company.



44





Regulation
 S provides generally that any offer or sale that occurs outside of the United States is exempt from the registration requirements of
 the Securities Act, provided that certain conditions are met. Regulation S has two safe harbors. One safe harbor applies to offers
 and sales by issuers, securities professionals involved in the distribution process pursuant to contract, their respective
 affiliates, and persons acting on behalf of any of the foregoing (the issuer safe harbor), and the other applies to
 resales by persons other than the issuer, securities professionals involved in the distribution process pursuant to contract, their
 respective affiliates (except certain officers and directors), and persons acting on behalf of any of the forgoing (the resale
 safe harbor). An offer, sale or resale of securities that satisfied all conditions of the applicable safe harbor is deemed to
 be outside the United States as required by Regulation S. The distribution compliance period for shares sold in reliance on
 Regulation S is six months.

TheCompanycomplied
 with the requirements of Regulation S of the Securities Act by (i) having made no directed offering efforts in the United States,
 (ii) issuing shares only to one offeree, and (iii) ensuring that the offeree to whom the securities were issued was a non-U.S.
 offeree with an address in a foreign country.

During
 the six months ended June 30, 2008, the Company issued 100,000 shares of common stock to Edward Moses for his services as a director.
 The shares were issued at $0.20 per share, totaling an aggregate of $20,000. The Company agreed to issue the shares relying on
 exemptions provided by Section 4(2) and Regulation D of the Securities Act.

The
 Company complied with the exemption requirements provided by Section 4(2) and Regulation D based on the following factors: (i) the
 issuance was an isolated private transaction by the Company which did not involve a public offering; (ii) there was only one offeree
 who was issued the Companys stock for services rendered; (iii) the offeree committed to hold the stock as required by
 applicable securities laws; (iv) there were no subsequent or contemporaneous public offerings of the stock; (v) the stock was not
 broken down into smaller denominations; and (vi) the negotiations that lead to the issuance of the stock took place directly between
 the offeree and the Company.



During
 the six months ended June 30, 2008, the Company issued 500,000 shares of common stock to Bill Purves for his advisory services.  The
 shares were issued at $0.20 per share, totaling an aggregate of $100,000. The Company agreed to issue the shares relying on
 exemptions provided by Section 4(2) and Regulation D of the Securities Act.

The
 Company complied with the exemption requirements provided by Section 4(2) and Regulation D based on the following factors: (i) the
 issuance was an isolated private transaction by the Company which did not involve a public offering; (ii) there was only one offeree
 who was issued the Companys stock for services rendered; (iii) the offeree committed to hold the stock as required by
 applicable securities laws; (iv) there were no subsequent or contemporaneous public offerings of the stock; (v) the stock was not
 broken down into smaller denominations; and (vi) the negotiations that lead to the issuance of the stock took place directly between
 the offeree and the Company.



ITEM
 3.     DEFAULTS ON SENIOR SECURITIES

None.

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

None.

45





ITEM
 5.     OTHER INFORMATION

None.



ITEM
 6.     EXHIBITS



Exhibits
 required to be attached by Item 601 of Regulation S-K are listed in the Index to Exhibits on page48
 of this Form 10-Q/A, and
 are incorporated herein by this reference.

46





SIGNATURES



Pursuant
 to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
 the undersigned, thereunto duly authorized.



Providence
 Resources, Inc.



/s/ Gilbert BurciagaOctober
 17, 2008Gilbert Burciaga                    Chief
 Executive Officer, Chief Financial Officer, and Principal Accounting Officer



47





EXHIBITS

Exhibit     Description

3(i)(a)*       Articles
 of Incorporation (incorporated by reference from the Form 10-SB filed with the Commission on April 17, 2000).

3(i)(b)(c)*       Amendment
 to Articles of Incorporation (incorporated by reference from the Form 10-SB filed with the Commission on April 17, 2000).

3(i)(d)*     Amended
 and Restated Articles of Incorporation (incorporated by reference from the Form 10-SB filed with the Commission on April 17, 2000).

3(i)(e)*     Articles
 of Amendment to the Amended and Restated Articles of Incorporation (incorporated by reference from the Form 10-QSB filed with the
 Commission on November 17, 2003).

3(i)(f)*     Amendment
 to the Amended and Restated Articles of Incorporation (incorporated by reference from the Form 8-K filed with the Commission on
 October 2, 2006).

3(i)(g)*     Amendment
 to the Amended and Restated Articles of Incorporation (incorporated by reference from the Form 10-QSB filed with the Commission on
 August 14, 2007).

3(ii)(a)*     Bylaws
 of the Company (incorporated by reference from the Form 10-SB filed with the Commission on April 17, 2000).

3(ii)(b)*       Amended
 and Restated Bylaws of the Company (incorporated by reference from the Form 8-K filed with the Commission on October 26, 2006).

10(i)*       Joint
 Venture Agreement between Providence Exploration and Harding Company, dated October 1, 2005 (incorporated by reference from the Form
 8-K filed with the Commission on October 2, 2006).

10(ii)*       Agreement
 for Purchase and Sale between Providence Exploration and Global Mineral Solutions, L.P., dated February 22, 2006 (incorporated by
 reference from the Form 8-K filed with the Commission on October 2, 2006).

10(iii)*       Securities
 Exchange Agreement dated April 10, 2006, between the Company, Providence Exploration, and the membership unit holders of Providence
 Exploration (filed on Form 8-K with the Commission on April 14, 2006).

10(iv)*       Note
 Exchange Agreement dated April 10, 2006, between the Company and the holders of certain promissory notes issued by Providence
 Exploration (filed on Form 8-K with the Commission on April 14, 2006).

10(v)*       Amendment
 to the Terms of the Securities Exchange Agreement effective as of May 26, 2006, between the Company, Providence Exploration, and the
 membership unit holders of Providence Exploration (filed on Form 8-K with the Commission on July 3, 2006).

10(vi)*       Amendment
 to the Terms of the Note Exchange Agreement effective as of May 26, 2006, between the Company and the holders of certain promissory
 notes issued by Providence Exploration (filed on Form 8-K with the Commission on July 3, 2006).

10(vii)*       Letter
 Agreement between Providence Exploration and Harding Company, dated March 30, 2006 (incorporated by reference from the Form SB2/A-2
 filed with the Commission on February 28, 2007).

10(viii)*       Exploration
 and development agreement with Miller Energy, LLC and certain of its affiliates dated June 29, 2007 (filed on Form 8-K with the
 Commission on July 11, 2007).

10(ix)*       Secured
 Revolving Convertible Promissory Note with Miller Energy, LLC dated June 29, 2007 (filed on Form 8-K with the Commission on July 11,
 2007).

10(x)     Project
 Participation Agreement with Elm Ridge Exploration Company, LLC, dated July 31, 2008 (attached).

14*       Code
 of Ethics, adopted as of March 1, 2004 (incorporated by reference from the form 10-QSB filed with the Commission on November 17,
 2004).

21*     Subsidiaries
 (incorporated by reference from the Form 10-K filed with the Commission on April 7, 2008).

31     Certification
 of the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14 of the Securities and Exchange Act of 1934, as
 amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (attached).

32          Certification
 of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of
 the Sarbanes-Oxley Act of 2002 (attached).



*
      Incorporated by reference to previous filings of the Company.

48