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

FORM 10-QSB

(Mark One)x Quarterly Report Pursuant To Section
  13 Or 15(d) Of The Securities Exchange Act Of 1934
  For the quarterly period ended September 30, 2005

 ̈ Transition Report
  Under Section 13 Or 15(d) Of The Securities Exchange Act Of 1934 
  For the transition period ________ to ________

COMMISSION FILE NUMBER000-51152

DIGITAL ECOSYSTEMS CORP.(Name of small business
issuer in its charter)

|NEVADA                                           | 98-0431245                          
|------------------------------------------------ | ------------------------------------
|(State or other jurisdiction of incorporation or | (I.R.S. Employer Identification No.)
|organization)                                    |                                     

|1313 East Maple Street, Suite 223        |           
|---------------------------------------- | ----------
|Bellingham, WA                           | 98225     
|(Address of principal executive offices) | (Zip Code)

(360) 685-4240Issuer's telephone number

#1500  701 West Georgia Street Vancouver, British
Columbia, Canada V7Y 1C6 (604) 681-7039Former name, former
address and former fiscal year, if changed since last report

Check whether the issuer (1) filed all reports required to be
  filed by Section 13 or 15(d) of the Exchange Act during the past twelve months
  (or for such shorter period that the registrant was required to file such reports),
  and (2) has been subject to such filing requirements for the past 90 days. Yes
  xNo  ̈

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

State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: As of November
15, 2005, the Registrant had 28,700,000 shares of common stock issued and
outstanding.

Transitional Small Business Disclosure Format (check one): Yes
   ̈ No x

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PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

The accompanying unaudited financial statements have been
prepared in accordance with the instructions to Form 10-QSB and Item 310(b) of
Regulation S-B, and, therefore, do not include all information and footnotes
necessary for a complete presentation of financial position, results of
operations, cash flows, and stockholders' equity in conformity with accounting
principles generally accepted in the United States of America. In the opinion of
management, all adjustments considered necessary for a fair presentation of the
results of operations and financial position have been included and all such
adjustments are of a normal recurring nature. Operating results for the
quarterly period ended September 30, 2005 are not necessarily indicative of the
results that can be expected for the year ending March 31, 2006.

As used in this Quarterly Report, the terms "we", "us", "our",
and Digital Ecosystems mean Digital Ecosystems Corp. unless otherwise
indicated. All dollar amounts in this Quarterly Report are in U.S. dollars
unless otherwise stated.

2

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

SECOND QUARTER FINANCIAL STATEMENTS

SEPTEMBER 30, 2005(Unaudited) 
  (Stated in U.S. Dollars)



F-1

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

BALANCE SHEETS(Stated in U.S. Dollars)

|                                                       |   | SEPTEMBER 30 |   |   | MARCH 31  |  
|------------------------------------------------------ | - | ------------ | - | - | --------- | -
|                                                       |   | 2005         |   |   | 2005      |  
|                                                       |   | (Unaudited)  |   |   | (Audited) |  
|                                                       |   |              |   |   |           |  
|ASSETS                                                 |   |              |   |   |           |  
|                                                       |   |              |   |   |           |  
|Current                                                |   |              |   |   |           |  
|Cash                                                   | $ | 88           |   | $ | 4,014     |  
|                                                       |   |              |   |   |           |  
|LIABILITIES                                            |   |              |   |   |           |  
|                                                       |   |              |   |   |           |  
|Current                                                |   |              |   |   |           |  
|Accounts payable
      and accrued liabilities         |   | 23,346       |   | $ | 26,932    |  
|Due to related party (Note 2(a))                       |   | 22,173       |   |   | 1,000     |  
|Loan payable (Note
      3)                            | $ | 8,424        |   |   | -         |  
|                                                       |   | 53,943       |   |   | 27,932    |  
|                                                       |   |              |   |   |           |  
|STOCKHOLDERS DEFICIENCY                               |   |              |   |   |           |  
|                                                       |   |              |   |   |           |  
|Capital Stock                                          |   |              |   |   |           |  
|Authorized:                                            |   |              |   |   |           |  
|1,000,000,000 voting common stock with a par value     |   |              |   |   |           |  
|of $0.001 per share                                    |   |              |   |   |           |  
|100,000,000 preferred stock with a par value of        |   |              |   |   |           |  
|$0.001 per share                                       |   |              |   |   |           |  
|                                                       |   |              |   |   |           |  
|Issued and outstanding                                 |   |              |   |   |           |  
|91,200,000 common shares at March 31, 2005             |   | 28,700       |   |   | 91,200    |  
|28,700,000 common shares at September 30, 2005         |   |              |   |   |           |  
|                                                       |   |              |   |   |           |  
|Additional paid-in
      capital                       |   | 124,767      |   |   | 50,267    |  
|                                                       |   |              |   |   |           |  
|Deficit Accumulated During The Development
      Stage |   | (207,322     | ) |   | (165,385  | )
|                                                       |   | (53,855      | ) |   | (23,918   | )
|                                                       |   |              |   |   |           |  
|                                                       | $ | 88           |   | $ | 4,014     |  

The accompanying notes are an integral part of these financial
  statements

F-2

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

STATEMENTS OF OPERATIONS(Unaudited)(Stated in U.S. Dollars)

CUMULATIVEPERIODFROMINCEPTIONONFEBRUARY21THREE MONTHS ENDED
      
      
      SIX MONTHS ENDED
      
      
      2002 TOSEPTEMBER 30
      
      
      SEPTEMBER 30
      
      
      SEPTEMBER302005
      
      
      2004
      
      
      2005
      
      
      2004
      
      
      2005Revenue
      $
      -
      
      $
      -
      
      $
      -
      
      $
      -
      
      $
      -ExpensesConsulting  Officers anddirectors
      
      6,000
      
      
      6,000
      
      
      12,000
      
      
      12,000
      
      
      56,700Management fees
      
      5,000
      
      
      -
      
      
      5,000
      
      
      -
      
      
      5,000Consulting 
        Websitedevelopment
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      10,094Consulting 
        Other
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      22,946Office and miscellaneous
      
      2,004
      
      
      1,038
      
      
      2,480
      
      
      1,909
      
      
      11,720Professional
        fees
      
      15,465
      
      
      15,685
      
      
      22,090
      
      
      16,818
      
      
      99,695Rent
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      3,105Telephone
      
      89
      
      
      144
      
      
      213
      
      
      144
      
      
      1,043Foreign exchange
      
      (63
      )
      
      -
      
      
      (32
      )
      
      -
      
      
      (3,847
      )Transfer agent
      
      186
      
      
      -
      
      
      186
      
      
      -
      
      
      866Net Loss For The Period
      
      (28,681
      )
      
      (22,867
      )
      $
      (41,937
      )
      $
      (30,871
      )
      $
      (207,322
      )Net Loss Per Share Basic
      
      (0.00
      )
      
      (0.00
      )
      $
      (0.00
      )
      $
      (0.00
      )Weighted Average NumberOf Shares Outstanding
      
      81,009,783
      
      
      91,200,000
      
      
      86,077,049
      
      
      88,522,404


The accompanying notes are an integral part of these financial
  statements

F-3

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

STATEMENTS OF CASH FLOWS(Unaudited)(Stated in U.S. Dollars)

CUMULATIVEPERIOD FROMINCEPTION ONFEBRUARY 21THREE MONTHS ENDED
      
      
      SIX MONTHS ENDED
      
      
      2002 TOSEPTEMBER 30
      
      
      SEPTEMBER 30
      
      
      SEPTEMBER 302005
      
      
      2004
      
      
      2005
      
      
      2004
      
      
      2005Cash Flows FromDevelopment ActivitiesNet loss for the
        period
      $
      (28,681
      )
      $
      (22,867
      )
      $
      (41,937
      )
      $
      (30,871
      )
      $
      (207,322
      )Adjustment To Reconcile NetLoss To Net Cash Used InDevelopment ActivitiesDecrease (Increase) inaccounts receivable
      
      -
      
      
      -
      
      
      -
      
      
      1,134
      
      
      -Increase in due to relatedparty
      
      5,000
      
      
      -
      
      
      21,173
      
      
      -
      
      
      22,173Increase (Decrease) inaccounts accrued liabilities
      
      8,512
      
      
      7,167
      
      
      (3,586
      )
      
      4,828
      
      
      23,346Non-cash services fromofficers
      
      6,000
      
      
      6,000
      
      
      12,000
      
      
      12,000
      
      
      56,700(9,169
      )
      
      (9,700
      )
      
      (12,350
      )
      
      (12,909
      )
      
      (105,103
      )Cash Flows From FinancingActivitiesLoan payable
      
      8,424
      
      
      -
      
      
      8,424
      
      
      -
      
      
      8,424Proceeds from
        issuanceof common
        stock
      
      -
      
      
      -
      
      
      -
      
      
      37,569
      
      
      96,7678,424
      
      
      -
      
      
      8,424
      
      
      37,569
      
      
      105,191Net Increase (Decrease) InCash
      
      (745
      )
      
      (9,700
      )
      
      (3,926
      )
      
      24,660
      
      
      88Cash, Beginning Of Period
      
      833
      
      
      56,343
      
      
      4,014
      
      
      21,983
      
      
      -Cash, End Of
        Period
      $
      88
      
      $
      46,643
      
      $
      88
      
      $
      46,643
      
      $
      88


The accompanying notes are an integral part of these financial
  statements

F-4

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

STATEMENT OF STOCKHOLDERS EQUITY (DEFICIENCY)

PERIOD FROM INCEPTION, FEBRUARY 21, 2002, TO SEPTEMBER 30,
  2005(Unaudited)(Stated in U.S. Dollars)

|                                |  |             |   |   |         |   |   |            |   |   |               |   |   | DEFICIT         |   |   |          |  
|------------------------------- |  | ----------- | - | - | ------- | - | - | ---------- | - | - | ------------- | - | - | --------------- | - | - | -------- | -
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   | ACCUMULATED     |   |   |          |  
|                                |  | NUMBER      |   |   |         |   |   | ADDITIONAL |   |   | STOCK         |   |   | DURING THE      |   |   |          |  
|                                |  | OF          |   |   |         |   |   | PAID-IN    |   |   | SUBSCRIPTIONS |   |   | **DEVELOPMENT** |   |   |          |  
|                                |  | SHARES      |   |   | AMOUNT  |   |   | CAPITAL    |   |   | RECEIVED      |   |   | STAGE           |   |   | TOTAL    |  
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Common stock issued for cash    |  | 15,000,000  |   | $ | 15,000  |   | $ | (13,500    | ) | $ | -             |   | $ | -               |   | $ | 1,500    |  
|Net loss for the period         |  | -           |   |   | -       |   |   | -          |   |   | -             |   |   | (1,770          | ) |   | (1,770   | )
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Balance, March 31, 2002         |  | 15,000,000  |   |   | 15,000  |   |   | (13,500    | ) |   | -             |   |   | (1,770          | ) |   | (270     | )
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Common stock issued for cash    |  | 50,000,000  |   |   | 50,000  |   |   | (45,000    | ) |   | -             |   |   | -               |   |   | 5,000    |  
|Cash received for stock         |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|subscriptions                   |  | -           |   |   | -       |   |   | -          |   |   | 31,200        |   |   | -               |   |   | 31,200   |  
|Non-cash services from officers |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|and directors                   |  | -           |   |   | -       |   |   | 9,900      |   |   | -             |   |   | -               |   |   | 9,900    |  
|Net loss for the year           |  | -           |   |   | -       |   |   | -          |   |   | -             |   |   | (20,484         | ) |   | (20,484  | )
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Balance, March 31, 2003         |  | 65,000,000  |   |   | 65,000  |   |   | (48,600    | ) |   | 31,200        |   |   | (22,254         | ) |   | 25,346   |  
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Common stock issued for cash    |  | 16,200,000  |   |   | 16,200  |   |   | 36,498     |   |   | (31,200       | ) |   | -               |   |   | 21,498   |  
|Non-cash services from officers |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|and directors                   |  | -           |   |   | -       |   |   | 10,800     |   |   | -             |   |   | -               |   |   | 10,800   |  
|Net loss for the year           |  | -           |   |   | -       |   |   | -          |   |   | -             |   |   | (39,527         | ) |   | (39,527  | )
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Balance, March 31, 2004         |  | 81,200,000  |   |   | 81,200  |   |   | (1,302     | ) |   | -             |   |   | (61,781         | ) |   | 18,117   |  
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Common stock issued for cash    |  | 10,000,000  |   |   | 10,000  |   |   | 27,569     |   |   | -             |   |   | -               |   |   | 37,569   |  
|Non-cash services from officers |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|and directors                   |  | -           |   |   | -       |   |   | 24,000     |   |   | -             |   |   | -               |   |   | 24,000   |  
|Net loss for the year           |  | -           |   |   | -       |   |   | -          |   |   | -             |   |   | (103,604        | ) |   | (103,604 |  
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   | )        |  
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Balance, March 31, 2005         |  | 91,200,000  |   |   | 91,200  |   |   | 50,267     |   |   | -             |   |   | (165,385        | ) |   | (23,918  | )
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Non-cash services from officers |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|and directors                   |  | -           |   |   | -       |   |   | 12,000     |   |   | -             |   |   | -               |   |   | 12,000   |  
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Cancellation of 62,500,000      |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|common shares                   |  | (62,500,000 | ) |   | (62,500 | ) |   | 62,500     |   |   | -             |   |   | -               |   |   | -        |  
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Net loss for the period         |  | -           |   |   | -       |   |   | -          |   |   | -             |   |   | (41,937         | ) |   | (41,937  | )
|                                |  |             |   |   |         |   |   |            |   |   |               |   |   |                 |   |   |          |  
|Balance, September 30, 2005     |  | 28,700,000  |   |   | 28,700  |   |   | 124,767    |   |   | -             |   |   | (207,322        | ) |   | (53,855  | )

The accompanying notes are an integral part of these financial
  statements

F-5

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2005(Unaudited)(Stated in U.S. Dollars)

|1. | ORGANIZATION AND BASIS OF PRESENTATION
|-- | --------------------------------------
|   |                                       
|   | a)                                    
|   |                                       
|   |                                       
|   |                                       
|   |                                       
|   |                                       
|   |                                       
|   |                                       
|   | b)                                    
|   |                                       
|   |                                       

F-6

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2005(Unaudited)(Stated in U.S. Dollars)

|1. | ORGANIZATION AND BASIS OF PRESENTATION(Continued)
|-- | -------------------------------------------------
|   |                                                  
|   | b)                                               
|   |                                                  
|   |                                                  
|   |                                                  
|   |                                                  
|   |                                                  
|2. | RELATED PARTY TRANSACTIONS                       
|   |                                                  
|   | a)                                               
|   |                                                  
|   |                                                  
|   |                                                  
|   |                                                  

F-7

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2005(Unaudited)(Stated in U.S. Dollars)

|2. | RELATED PARTY TRANSACTIONS(Continued)                                                                                                                                                                                                                             
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                   
|   | b)                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                   
|3. | LOAN PAYABLE                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                   
|   | On September 15, 2005, the company entered
        into a loan agreement with Enerex Capital Corp. (the lender),
        whereby the lender agreed to loan the Company $8,424 ($10,000 CDN). The
        loan bears no interest and is repayable within 60 days.
|   |                                                                                                                                                                                                                                                                   
|4. | CAPITAL STOCK                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                   
|   | From inception on February 21, 2002 to March
        31, 2002, the Company issued 15,000,000 common shares in exchange for
        cash proceeds of $1,500.                                                                                                       
|   |                                                                                                                                                                                                                                                                   
|   | During the year ended March 31, 2003, the
        Company issued 50,000,000 common shares, in exchange for cash proceeds
        of $5,000. It also received $31,200 for stock subscriptions for shares
        issued the following year.                        
|   |                                                                                                                                                                                                                                                                   
|   | During the year ended March 31, 2004, the
        Company issued 16,200,000 common shares in exchange for cash proceeds
        of $52,698 including the $31,200 received for share subscriptions in 2003.                                                        
|   |                                                                                                                                                                                                                                                                   
|   | During the year ended March 31, 2005, the
        Company issued 10,000,000 common shares in exchange for cash proceeds
        of $37,569.                                                                                                                       

F-8

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DIGITAL ECOSYSTEMS CORP.(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2005(Unaudited)(Stated in U.S. Dollars)

|4. | CAPITAL STOCK(Continued)                                                                                                                                                                                                                
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                         
|   | In the second quarter ended September 30,
        2005, the Companys Board of Directors approved 10:1 forward stock
        split. As a result of the stock split, an additional 82,080,000 shares
        of common stock were issued.
|   |                                                                                                                                                                                                                                         
|   | In the second quarter ended September 30,
        2005, the Company cancelled 62,500,000 shares of common stock and they
        were returned back to the Companys treasury for no proceeds.                                          
|   |                                                                                                                                                                                                                                         
|5. | SUBSEQUENT EVENTS                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                         
|   | a)                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                         
|   | b)                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                         
|   | c)                                                                                                                                                                                                                                      

F-9

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION.

Cautionary Statement Regarding Forward-Looking
Statements

Certain statements contained in this Quarterly Report
constitute "forward-looking statements". These statements, identified by words
such as plan, "anticipate," "believe," "estimate," "should," "expect" and
similar expressions include our expectations and objectives regarding our future
financial position, operating results and business strategy. These statements
reflect the current views of management with respect to future events and are
subject to risks, uncertainties and other factors that may cause our actual
results, performance or achievements, or industry results, to be materially
different from those described in the forward-looking statements. Such risks and
uncertainties include those set forth under the caption "Management's Discussion
and Analysis or Plan of Operation" and elsewhere in this Quarterly Report. We do
not intend to update the forward-looking information to reflect actual results
or changes in the factors affecting such forward-looking information. We advise
you to carefully review the reports and documents we file from time to time with
the Securities and Exchange Commission (the SEC), particularly our Annual
Reports on Form 10-KSB and our Current Reports on Form 8-K.

INTRODUCTION

We are a development stage company in the business of
developing and operating an internet based drinking water information and order
service (the Water Business) at our website www.digitalecosystems.com (the
Website). The Website is focused on providing consumers with current and
comprehensive sources of bottled and bulk water, water information and water
treatment options delivered through a website that aggregates and affiliates
with national/regional, state-provincial, and large municipal bottled water
companies and equipment manufacturers. Our plan of operation is to develop a
comprehensive one-stop-shop source of water and water information and to become
established as a significant industry distributor. We conduct our business
through agreements with consultants and arms-length third parties.

Recent Corporate Developments

We have not earned revenues to date, and from inception to
September 30, 2005, we have suffered cumulative losses in the amount of
$207,322. We are presently evaluating whether to continue developing our Water
Business and are considering pursuing other opportunities in the oil and natural
gas business, in part based on our current managements experience in the
natural resource industry. Mr. Gregory Leigh Lyons, who was appointed as our
chief executive officer, chief financial officer, president, secretary,
treasurer and as our sole director on September 15, 2005, has more than 21 years
of domestic and international experience in operations, P&L management,
strategic planning and positioning, acquisition, and project management with
both start-up and mature organizations. Most of his career has been spent in the
oil and gas exploration and production business sector.

Since the completion of our last fiscal quarter ended June 30,
2005, we have experienced the following corporate developments:

|1. | We entered into a Marketing Management Services Contract
      (the Marketing Agreement) with Chorus Marketing (Chorus) dated October
      15, 2005. Pursuant to the terms of the Marketing Agreement, we agreed to
      pay Chorus $5,000 per month in consideration of which Chorus agreed to act
      as our representative and oversee the coordination of marketing
      initiatives on our behalf including: brand identity, website design and
      development, investor information packages, copywriting, editing and
      proofing and news release dissemination
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3

---

|   | services. We further agreed to reimburse Chorus for all
      disbursements reasonably incurred by Chorus for the purpose of providing
      the consulting services to us. The Marketing Agreement is for a term of
      one year and expires on October 16, 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|2. | We entered into a loan agreement (the Loan Agreement)
      with Carnavon Trust Reg. (Carnavon), a domiciled discretionary trust of
      Lichtenstein, dated for reference October 11, 2005. Pursuant to the terms
      of the Loan Agreement we received a loan of $100,000 (the Loan) which we
      agreed to repay by October 11, 2006 with interest on the Loan payable at
      an annual rate of 12%. Upon maturity of the Loan, Carnavon has the option
      to convert the Loan amount at a price equal to the closing price of our
      common stock quoted on the over- the-counter bulletin board on the day
      preceding the day we receive the notice of conversion.                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|3. | We entered into a consulting agreement with Beneficial
      Designs, Inc. (BDI) dated October 1, 2005 (the Consulting Agreement),
      pursuant to which BDI agreed to provide Digital Ecosystems with certain
      marketing and investor relations services in consideration of which we are
      to pay $10,000 per month to BDI. We further agreed to reimburse BDI for
      all disbursements reasonably incurred by BDI for the purpose of providing
      the consulting services to Digital Ecosystems. The Consulting Agreement
      commenced October 1, 2005 and terminates on October 31, 2006. The
      Consulting Agreement may be terminated by either party on 30 days written
      notice with the exception that during the first 90 day probationary period
      of the Consulting Agreement we may at our option terminate the Consulting
      Agreement.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|4. | Effective September 16, 2005, we completed a ten-for-one
      split of our issued and outstanding common stock. As a result of the stock
      split, our authorized capital has increased from 100,000,000 shares of
      common stock with a par value of $0.001 per share, of which 2,870,000
      shares were issued and outstanding, to 1,000,000,000 shares of common
      stock with a par value of $0.001 per share, of which 28,700,000 are issued
      and outstanding. As a result of the stock split, the symbol under which
      our shares trade on the OTC Bulletin Board has been changed from DECS to
      DGEO, effective September 16, 2005.                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|5. | On September 15, 2005, Mr. Gregory Leigh Lyons acquired
      250,000 (pre-split) shares of our common stock from Ms. Valentina Tuss for
      consideration of $20,000 paid from personal funds. At the same time, Ms.
      Tuss surrendered for cancellation 6,250,000 (pre-split) shares held by
      her. As a result of the share transfer and share cancellation by Ms. Tuss,
      Mr. Lyons holds 8.7% of the outstanding shares of our common stock and is
      our largest shareholder.                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | The purchase of the shares by Mr. Lyons and the
      cancellation of the shares by Ms. Tuss were completed under a share
      transfer and cancellation agreement dated September 1, 2005 (the Share
      Transfer and Cancellation Agreement). Under the terms of the Share
      Transfer and Cancellation Agreement, on September 15, 2005 Ms. Tuss
      resigned as president, chief executive officer and a director of Digital
      Ecosystems and Mr. Geoffrey O. Last resigned as our chief financial
      officer, secretary, treasurer and as a director. Following the
      resignations of Mr. Last and Ms. Tuss, Mr. Lyons was appointed as our
      chief executive officer, chief financial officer, president, secretary,
      treasurer and as our sole director.                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|6. | On September 15, 2005, we entered into a loan agreement
      with Enerex Capital Corp. (the lender), whereby the lender agreed to
      loan us $8,424 ($10,000 CDN). The loan bears no interest and is repayable
      within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

4

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Water Business

Our Water Business is intended to serve customers through a
website that directs regional sales to the local area affiliate and coordinates
sales and distribution. We intend to aggregate contacts in the water industry to
provide the most comprehensive catalog of water products and bring them to
communities in North America with plans to expand globally. The products we
intend to offer cover a range from:

| | (a) | Bottled water applications;                                                                                
| | --- | -----------------------------------------------------------------------------------------------------------
| | (b) | Information and reports on the water industry; and                                                         
| | (c) | A community based website whereby people can educate
        themselves about water and the water industry.

Our objective is to provide the consumer and researcher with
current information about bottled water. By offering a comprehensive
one-stop-shop source of water and water information, we hope to become
established as a significant industry distributor. The opportunity exists now
because the convergence of widespread consumer access to the internet and
inexpensive and robust web technology has made it feasible to offer information
at low cost.

Subject to our determination as to whether to continue
developing our Water Business, our business plan is to use the Website to earn
revenues from the following sources:

| | (a) | Reselling  private label reselling agreements;                                       
| | --- | --------------------------------------------------------------------------------------
| | (b) | Establishing additional affiliations to capture advertising
        revenue; and      
| | (c) | Sale of products and all e-commerce transactions originating
        from the Website.

We have not earned any revenues to date. Subject to our
determination as to whether to continue developing our Water Business we plan to
use the Website to earn revenues from advertising, sales of products and all
e-commerce transactions originating from the Website. We do not anticipate
earning revenues until such time as we complete the marketing, promotion and
development of the Website.

PLAN OF OPERATION

We have not earned any revenues to date, and from inception to
September 30, 2005, we have suffered cumulative losses in the amount of
$207,322. We are presently evaluating whether to continue developing our Water
Business and considering pursuing other opportunities in the oil and natural gas
business.

Subject to our determination as to whether to continue
developing our Water Business and our ability to obtain additional financing,
the following are the highlights our milestones and objectives for developing
and marketing our Website over the next twelve months:

Milestones and
      Objectives
    Anticipated Costs
    Time Frame1. Complete web site development, hosting, working
        capital.
      $5,000
      1 month2. Complete beta testing of web site
      $5,000
      1 month3. Registering vendors/vendees
            contacting and signing up related parties.
      $1,000
      4 - 6 months


5

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Milestones and
      Objectives
    Anticipated Costs
    Time Frame4.   Building an experienced
      advisory board 
                   recruiting
        key, seasoned personnel.
    $2,000
    6 - 8 months5. Developing key industry
      relationships 
                  building out web portal
        with related industry groups.
    $1,000
    9 - 12 months6. Build relationships with key
      players in industry 
                  attend trade shows,
        join industry organizations.
    $2,000
    9 - 12 months7. Develop private water label
          distribution      
                    secure
          relationship with water supplier, label 
                   supplier, expand
          sales mission.
    $2,000
    4 - 6 months8. Implement marketing and advertising
      campaign.
    $12,000
    9 - 12 monthsTOTAL
    $30,000
    -


We anticipate that we will spend approximately $207,000 over
  the next twelve months on the following expenses:

Category
      Planned Expenditures over the Next Twelve
        Months
        (US$)Professional Fees
      $15,000Office Expenses
      $12,000Consulting Fees
      $180,000TOTAL
      $207,000


We presently do not have sufficient cash on hand to fund our
proposed expenditures for the next twelve months, and will require additional
financing to pursue our stated plan of operation. As a result, we have not made
any significant progress in pursuing our plan of operation since the completion
of our fiscal year ended March 31, 2005. Further marketing and development work
on our Website, also will require additional funding in the event that our
current cash on hand is insufficient for any additional work proposed.

We anticipate that additional funding will be in the form of
equity financing from the sale of our common stock. However, we cannot provide
investors with any assurance that we will be able to raise sufficient funding
from the sale of our common stock to fund additional expenditures. The risky
nature of this enterprise and lack of tangible assets places debt financing
beyond the credit-worthiness required by most banks or typical investors of
corporate debt until such time as we generate revenues from our Website
operations. We do not have any arrangements in place for any future equity
financing.

Revenues

We have not earned any revenues to date and we do not
anticipate earning revenues in the near future. We are a development stage
company and presently have only nominal operations and assets.

6

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LIQUIDITY AND FINANCIAL CONDITION

|                          |                             |                         | Percentage           
|------------------------- | --------------------------- | ----------------------- | ---------------------
|                          | At September
      30, 2005 | At March
      31, 2005 | Increase / (Decrease)
|Current Assets            | $88                         | $4,014                  | (4461)%              
|Current Liabilities       | $53,943                     | $27,932                 | 93%                  
|Working Capital (Deficit) | $(53,855)                   | $(23,918)               | 125%                 

|                                                    | Six Months Ended September 30
|--------------------------------------------------- | -----------------------------
|                                                    | 2005                         
|Cash Flows (used in) Development Activities         | $(12,350)                    
|Cash Flows From Financing Activities                | $8,424                       
|Net Increase (Decrease) in Cash During
      Period | $(3,926)                     

The decreases in our working capital surplus at September 30,
2005 from our year ended March 31, 2005, and the increases in our cash used
during the periods ended on September 30, 2005, from the comparable periods of
the preceding fiscal year are primarily a result of the increase in our
professional fees related to the professional fees paid in connection with
preparing and filing our Registration Statement on Form SB-2 and the amendments
thereto and from the fact that we had no revenue or sources of financing during
the period ended September 30, 2005.

Future Financings

From inception to September 30, 2005, we have suffered
cumulative losses in the amount of $207,322. We are presently evaluating whether
to continue developing our Water Business and considering pursuing other
opportunities in the oil and natural gas business. We expect to continue to
incur substantial losses as we continue the development of our business.

Since our inception, we have funded operations through common
stock issuances, related party loans, and the support of creditors in order to
meet our strategic objectives. Our management believes that sufficient funding
will be available to meet our business objectives and working capital needs and
are currently evaluating several financing options. However, there can be no
assurance that we will be able to obtain sufficient funds to continue the
development of and, if successful, to earn revenues from the operation of, our
Website. As a result of the foregoing, our independent auditors believe there
exists a substantial doubt about our ability to continue as a going concern.

OFF-BALANCE SHEET ARRANGEMENTS

We have 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.

7

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CRITICAL ACCOUNTING POLICIES

We have identified certain accounting policies, described
below, that are the most important to the portrayal of our current financial
condition and results of operations.

Estimates

The preparation of our financial statements in conformity with
United States generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as of the date
of the balance sheet and revenues and expenses for the reporting period. Actual
results in future periods could be different from these estimates made.

Start-Up and Development Costs

Since inception, certain expenditures have been incurred
primarily for product development, business development, market development and
financing purposes. While these expenditures are intended to benefit future
periods, we follow the accounting policy of expensing as incurred those
expenditures not identified with specific projects or financing activities.

Comprehensive Income (Loss)

SFAS No. 130 establishes standards for reporting comprehensive
income (loss) and its components in financial statements. Comprehensive loss, as
defined, includes all changes in equity (net assets) during a period from
non-owner sources. To date, we have not had any significant transactions that
are required to be reported in other comprehensive income (loss).

RISKS AND UNCERTAINTIES

An investment in our common stock involves a high degree of
risk. You should carefully consider the risks described below and the other
information in this prospectus before investing in our common stock. If any of
the following risks occur, our business, operating results and financial
condition could be seriously harmed. The trading price of our common stock, when
and if we trade at a later date, could decline due to any of these risks, and
you may lose all or part of your investment.

We Have Yet To Attain Profitable Operations And Because We
Will Need Additional Financing To Fund The Development Of Our Website, Our
Accountants Believe There Is Substantial Doubt About Our Ability To Continue As
A Going Concern.

We have incurred a net loss of $207,322 for the period from
inception to September 30, 2005, and have earned no revenues to date. Our future
is dependent upon future profitable operations from the development of our
Website. These factors raise substantial doubt that we will be able to continue
as a going concern. We have cash in the amount of $88 as of September 30, 2005.
Our total expenditures over the next twelve months are anticipated to be
approximately $207,000, the majority of which is due to consulting fees and
expenditures related to general, legal, accounting and administrative expenses
as a result of our becoming a reporting issuer under the Exchange Act. We
presently do not have sufficient cash on hand to fund our proposed expenditures
for the next twelve months and will require additional financing. Further
marketing and development work on our Website will also require additional
funding in the event that our cash on hand is insufficient for any additional
work proposed.

8

---

Our financial statements included with this Quarterly Report
have been prepared assuming that we will continue as a going concern. If we are
not able to earn revenues, then we may not be able to continue as a going
concern and our financial condition and business prospects will be adversely
affected. These factors raise substantial doubt that we will be able to continue
as a going concern and adversely affect our ability to obtain additional
financing.

Our Short Operating History Makes our Business Difficult To
Evaluate, Accordingly, We Have A Limited Operating History Upon Which To Base An
Evaluation Of Our Business And Prospects.

We have a limited operating history upon which to base an
evaluation of our business and prospects. Our business and prospects must be
considered in light of the risks, expenses and difficulties frequently
encountered by companies in their early stage of development, particularly
companies in new and rapidly evolving markets such as electronic commerce. These
risks include: the initial completion of a developed product, the demand for the
companys product, the companys ability to adapt to rapid technological change,
the level of product and price competition, the companys success in setting up
and expanding distribution channels and whether the company can develop and
market new products and control costs.

To address these risks, we must successfully implement our
business plan and marketing strategies. We may not successfully implement all or
any of our business strategies or successfully address the risks and
uncertainties that we encounter.

We Have No Revenues, Accordingly, There Is No Assurance That
We Will Be Able To Generate Revenues From Sales Commissions And Advertising Or
That The Revenues Generated Will Exceed The Operating Costs Of Our
Business.

Our business and marketing strategy contemplates that we will
earn a substantial portion of our revenues from sales commissions and
advertising. We have no history of earning revenues and there is no assurance
that we will be able to generate revenues from sales commissions and advertising
or that the revenues generated will exceed the operating costs of our business.
Customers may not accept our Website as an acceptable source of water supply
services.

Operating Results Are Difficult To Predict, With The Result
That We May Not Achieve Profitability And Our Business May Fail.

Our future financial results are uncertain due to a number of
factors, many of which are outside our control. These factors include:

| | (1) | Our ability to successfully market our Website and the
        Water Business;                                                                          
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | Our ability to generate revenue through the Website
        and the Water Business;                                                                     
| | (3) | The timing, cost and availability of services on Websites
        comparable to ours and other non-web services;                                        
| | (4) | The amount and timing of costs relating to expansion
        of our operations;                                                                         
| | (5) | The announcement or introduction of competing websites
        and products of competitors; and                                                         
| | (6) | General economic conditions and economic conditions
        specific to the internet and electronic commerce.                                           
| | (7) | Our ability to transition the business from the Water
        Business to the Oil and Gas Business, should we determine to pursue that
        strategy.

9

---

These factors could negatively impact on our financial results,
with the result that we may not achieve profitability and our business may
fail.

We Will Require Additional Financing And May Not Be Able To
Continue Operations If Additional Financing Is Not Obtained.

As of September 30, 2005, we had cash in the amount of $88. Our
total expenditures over the next twelve months are anticipated to be
approximately $207,000 the majority of which is due to consulting fees and
general, legal, accounting and administrative expenses associated with our
becoming a reporting issuer under the Exchange Act. Further marketing and
development work on our Website will require additional funding in the event
that our current cash on hand is insufficient for any additional work proposed.
After the twelve month period, we will require additional financing for any
operational expenses and to pursue our plan of operation. We have no agreements
for additional financing and there can be no assurance that additional funding
will be available to us on acceptable terms in order to enable us to complete
our plan of operation.

Recognition Of The Website Is Essential To Growth Of The
Water Business, If We Are Unsuccessful In Building Strong Recognition Of The
Website, Then We May Not Be Able To Achieve Revenues.

We believe that the successful marketing, development and
promotion of the Website is critical to our success in attracting customers.
Furthermore, we believe that the importance of customer awareness will increase
as low barriers to entry encourage the proliferation of websites. If we are
unsuccessful in building strong recognition of the Website, then we may not be
able to achieve revenues. Our Website is intended to be marketed through various
techniques including: search engine placement, opt-in newsletters, links, cross
branding and banner ads. Supplier candidates are expected to be identified for
each geographic region we have targeted. Candidates for supply or representation
agreements are expected to be bottled water companies. Alliances are intended to
be formed with local companies in the bottled industry in each area. A similar
process is intended to be followed in each region as we expand. The marketing
and promotion efforts contemplated by us may not be successful in creating
business awareness of the Website or in enabling us to achieve revenues.

We Will Rely On Our Internet Service Provider For The
Operation Of Our Business, If The Quality Of Products And Services Provided By
Our Internet Service Provider Falls Below A Satisfactory Standard, Our Business
Could Be Harmed.

Our current state of technology involves utilizing commercially
available licensed technology to operate our web portal, through Kekko
Enterprises Inc., the host and monitor of our Website and our internet service
provider. The hosting is run through a server called Hayasa Networks at
www.hayasa.com. The server is co-located in Kelowna, British Columbia and
connected to large local providers including SHAW BigPipe, TELUS Business
Internet services and other smaller local providers in the area.

We depend on our internet service provider for the
following:

| | (1) | we do not own a gateway onto the internet, but instead
      rely on an internet service provider to connect the Website to the
      internet; and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                    
| | (2) | the Website depends on operating system, database, and
      server software that has been developed, produced by third
  parties.                 

10

---

We are not substantially dependent on any third party. We have
no formal agreements with our internet service provider and do not anticipate
any difficulty in locating another internet service provider in the event we
experience any disruption in service. However, if we are unable to locate
another internet service provider within a sufficient amount of time, or if the
quality of products and services provided by such third parties falls below a
satisfactory standard, our business could be harmed. A disruption in service,
whether due to internal technical or external factors, could result in customer
dissatisfaction and loss of credibility. Also, our loss of or inability to
maintain or obtain upgrades to certain licensed technology could result in
delays in developing our systems until equivalent technology could be identified
or developed, and integrated.

We Depend On Recruiting And Retaining Qualified Personnel
And The Inability To Do So Would Seriously Harm Our Business.

Our success is dependent in part on the services of certain key
management personnel, including G. Leigh Lyons, our sole director and officer.
We presently do not have any formal or written agreements with our key
management personnel providing services to us. The experience of our management
is an important factor contributing to our success and growth and the loss of
our management could have a material adverse effect on our company. Our future
success also depends on our attracting, retaining and motivating highly skilled
personnel and we may be unable to retain our key personnel or attract,
assimilate or retain other highly qualified personnel in the future.

We may also experience difficulty in hiring and retaining
highly skilled consultants with appropriate qualifications. Because of the
technical nature of our products and services and the market in which we
compete, our success depends on the continued services of our current executive
officers and our ability to attract and retain qualified personnel in the
information technology industry. Competition for qualified personnel in the
information technology industry is intense. Even if we invest significant
resources to recruit, train and retain qualified personnel, we may not be
successful in our efforts.

A Disruption In Our Hosting Services, Whether Due To
Internal Technical Or External Factors, Could Result In Customer Dissatisfaction
And Loss Of Credibility.

Substantially all of our communications software and hardware
and computer hardware is expected to be hosted at a remote facility in
Vancouver, British Columbia. The hosts systems are vulnerable to damage from
earthquake, fire, floods, power loss, telecommunications failures, break-ins and
similar events. Despite the hosts implementation of network security measures,
its servers may also be vulnerable to computer viruses, physical or electronic
break-ins, attempts by third parties deliberately to exceed the capacity of the
hosts systems and similar disruptive problems. A disruption in service, whether
due to internal technical or external factors, could result in customer
dissatisfaction and loss of credibility. We do not have property and business
interruption insurance to compensate for losses that may occur resulting from
such problems.

We May Not Be Able To Protect Our Proprietary Rights, And
Our Inability Or Failure To Do So Could Result In Loss Of Competitive And
Commercial Advantages That We Hold.

Our performance and ability to compete are dependent to a
significant degree on our ability to protect and enforce our intellectual
property rights. Presently our intellectual property consists of our domain name
www.digitalecosystems.com and our trade name
Digital Ecosystems.

We may not be able to protect our proprietary rights, and our
inability or failure to do so could result in loss of competitive and commercial
advantages that we hold. Additionally, we may choose to

11

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litigate to protect our intellectual property rights, which
could result in a significant cost of resources and money. We cannot assure
success in any such litigation that we might undertake.

Because We Are Significantly Smaller And Less Established
Than A Majority Of Our Competitors, We May Lack The Financial Resources
Necessary To Compete Effectively And Sustain Profitability.

We operate in competitive, fragmented industries and compete
for clients with a variety of larger and smaller companies that offer similar
products and services. Many of these competitors are more established, offer
more products, services and features, have a greater number of clients,
locations, and employees, and also have significantly greater financial,
technical, marketing, public relations, name recognition, and other resources
than we have. While our objective is to continue to develop our Website, we
currently or potentially compete with a variety of competitors involved in
providing services via the internet. These competitors include:

| | (1) | http://www.culligan.com       
| | --- | ------------------------------
| | (2) | http://www.pentawater.com     
| | (3) | http://www.waternet.com       
| | (4) | http://www.lakotawater.com    
| | (5) | http://www.purewaterinc.com   
| | (6) | http://www.bottledwaterweb.com
| | (7) | http://www.allwater.com       

There are a number of web based water sites that offer similar
content and services to us. They are, however, usually concerned with either
contextual education such as current events related to the water industry, and
or they sell only one particular product. We intend to aggregate a considerable
line of products both in the bottled water sector and in the preparation of
clean water with filters, reverse osmosis or desalination products.

Increased competition may result in the reduction in
advertising fees, the reduction of use of the Website and the inability of our
company to generate acceptance of the Website. Each of these factors would
likely result in increased operating costs and the inability to generate
revenues, any one of which could materially adversely affect our business,
results of operations and financial condition. Many of our current and potential
competitors have significantly greater financial, marketing, customer support,
technical and other resources than us. As a result, such competitors may be able
to attract potential users away from the Website, and they may be able to
respond more quickly to changes in customer preferences or to devote greater
resources to the development and promotion of their websites than we can.

Is A Penny Stock, Stockholders Will Be More Limited In Their
Ability To Sell Their Stock.

The shares of our common stock constitute penny stocks under
the Exchange Act. The shares will remain classified as a penny stock for the
foreseeable future. The classification as a penny stock makes it more difficult
for a broker/dealer to sell the stock into a secondary market, which makes it
more difficult for a purchaser to liquidate his or her investment. Any
broker/dealer engaged by the purchaser for the purpose of selling his or her
shares will be subject to rules 15g-1 through 15g-10 of the Exchange Act. Rather
than having to comply with these rules, some broker-dealers will refuse to
attempt to sell a penny stock.

The "penny stock" rules adopted by the SEC under the Exchange
Act subjects the sale of the shares of our common stock to certain regulations
which impose sales practice requirements on broker/dealers. For example,
brokers/dealers selling such securities must, prior to effecting the

12

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transaction, provide their customers with a document that
discloses the risks of investing in such securities.

Legal remedies, which may be available to you as an investor in
"penny stocks", are as follows:

|(a) | if "penny stock" is sold to you in violation of your
      rights listed above, or other federal or states securities laws, you may
      be able to cancel your purchase and get your money back.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                   
|(b) | if the stocks are sold in a fraudulent manner, you may be
      able to sue the persons and firms that caused the fraud for
  damages.                                                            
|    |                                                                                                                                                                                                   
|(c) | if you have signed an arbitration agreement, however, you
      may have to pursue your claim through arbitration.                                                                                

If the person purchasing the securities is someone other than
an accredited investor or an established customer of the broker/dealer, the
broker/dealer must also approve the potential customer's account by obtaining
information concerning the customer's financial situation, investment experience
and investment objectives. The broker/dealer must also make a determination
whether the transaction is suitable for the customer and whether the customer
has sufficient knowledge and experience in financial matters to be reasonably
expected to be capable of evaluating the risk of transactions in such
securities. Accordingly, the SEC's rules may limit the number of potential
purchasers of the shares of our common stock.

ITEM 3. CONTROLS AND PROCEDURES.

Evaluation Of Disclosure Controls And Procedures

As of the end of the period covered by this report, our
management carried out an evaluation, under the supervision and with the
participation of our principal executive officer and principal financial
officer, of the effectiveness of the design and operation of our disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
Exchange Act). Based on this evaluation, our principal executive officer and
principal financial officer has concluded that our disclosure controls and
procedures are, as of the date covered by this Quarterly Report, effective to
ensure that the information required to be disclosed by us in the reports that
we file or submit under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the SEC rules and forms.

Changes In Internal Controls Over Financial
Reporting

In connection with the evaluation of our internal controls
during our last fiscal quarter, our principal executive officer and principal
financial officer has determined that there have been no changes to our internal
controls over financial reporting that has materially affected, or is reasonably
likely to materially affect, our internal controls over financial reporting.

13

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

None.

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

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

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

None.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

ExhibitNumber
    Description of
      Exhibits3.1
    Articles of Incorporation.(1)3.2
    Certificate of Change to Authorized Capital
      Pursuant to NRS 78.209.(3)3.3
    Bylaws, as amended.(1)4.1
    Form of Share Certificate.(1)10.1
    Business Consultant Agreement dated October 1,
      2005.(4)10.2
    Marketing Management Contract dated October 15,
      2005.(4)10.3
      Loan Agreement
        dated for reference October 11, 2005 between Carnavon Trust Reg. and Digital
        Ecosystems Corp.14.1
    Code of Ethics.(2)31.1
      Certification
        of Principal Executive Officer and Principal Financial Officer pursuant
        to Section 302 of the Sarbanes-Oxley Act of 2002.


14

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Exhibit Number
    Description of
      Exhibits32.1
      Certification of Principal
        Executive Officer and Principal Financial Officer pursuant to 18 U.S.C.
        Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
        Act of 2002.


Notes

|(1) | Filed with the SEC as an exhibit to our Registration
      Statement on Form SB-2 originally filed on September 16, 2004, as
      amended.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-KSB filed on July 13, 2005.                                         
|(3) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on September 20, 2005.                                      
|(4) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on October 28, 2005.                                        

REPORTS ON FORM 8-K

The following Current Reports on Form 8-K were filed since the
beginning of the quarterly period ended September 30, 2005:

Date of Report on
      Form 8-K (YYYY/MM/DD)
    Date of Filing
      with the SEC (YYYY/MM/DD)
    Description of the Form 8-K2005/09/01
    2005/09/07
    Item 7.01 - Regulation F-D Disclosure.2005/09/16
    2005/09/20
    Item 5.01 - Change in
      Control; Item 5.02 - Appointment of G. Leigh Lyons as sole officer and
      director;  Item 5.03 - 10:1 Stock Split and Concurrent Increase
      to Authorized Capital to 1,000,000,000 shares of common stock with a
      Capital to 1,000,000,000 shares of common stock with a par value of $0.001
      per share; and Item 8.01 - New Stock Symbol: DGEO.2005/10/01
    2005/10/28
    Item 1.01 - Entry Into
      Consulting Agreement and Entry Into Marketing Agreement.


15

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SIGNATURES

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

|                        |     | DIGITAL ECOSYSTEMS CORP.                                 
|----------------------- | --- | ---------------------------------------------------------
|                        |     |                                                          
|                        |     |                                                          
|                        |     |                                                          
|Date: November 17, 2005 | By: | /s/
      G. Leigh Lyons                                 
|                        |     | G. LEIGH LYONS                                           
|                        |     | President, Secretary, Treasurer,                         
|                        |     | Chief Executive Officer and Chief Financial
      Officer
|                        |     | Director                                                 
|                        |     | (Principal Executive Officer)                            
|                        |     | (Principal Accounting Officer)                           

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