UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 FORM
10-Q




x
              QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the quarterly period ended September 30, 2008oro
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the transition period from to
  Commission
File Number 000-51268


RIDGEWOOD
ENERGY M FUND, LLC


(Exact
name of registrant as specified in its charter)








Delaware
              (State
      or other jurisdiction of
              incorporation
      or organization)
            
            13-4285167
              (I.R.S.
      Employer
              Identification
      No.)





1314
King Street, Wilmington, Delaware 19801


(Address
of principal executive offices) (Zip code)





(302)
888-7444


(Registrant’s
telephone number, including area code)





Securities
registered pursuant to Section 12(b) of the Act: None


Securities
registered pursuant to Section 12(g) of the Act:





Shares of
LLC Membership Interest





Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.


Yes  xNo  o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definitions of “large accelerated filer,” “accelerated filer,” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):





Large
      accelerated filer
              o
              Accelerated
      filer
              oNon-accelerated
      filer
                (Do
      not check if a smaller reporting company)
              o
              Smaller
      reporting company
              x





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





There is
no market for the shares. As of November 4, 2008 there are 535.6818 shares
outstanding.












Table
      ofContentsPart I - FINANCIAL INFORMATION
                                
                                PageItem 1.     Financial Statements:Unaudited Condensed Balance Sheets as of September 30, 2008 and
      December 31, 2007
                                
                                2Unaudited Condensed Statements of Operations for the three and
      nine months ended

                                  September 30, 2008 and 2007
                                
                                3Unaudited Condensed Statements of Cash Flows for nine months
      ended
                                  September 30, 2008 and 2007
                                
                                4Notes to Unaudited Condensed Financial
      Statements
                                
                                5Item 2.     Management's Discussion and Analysis of Financial Condition and
      Results of Operations
                                
                                11Item 3.     Quantitative and Qualitative Disclosures about Market
      Risk
                                
                                18Item 4.     Controls
      and Procedures
                                
                                18Part II - OTHER INFORMATIONItem 1.     Legal
      ProceedingsItem 1A.  Risk
      Factors
                                
                                18Item 2.     Unregistered Sales of Equity Securities and Use of
      Proceeds
                                
                                18Item 3.     Defaults
      Upon Senior Securities
                                
                                18Item 4.     Submissions of Matters to a Vote of Security
      Holders
                                
                                18Item 5.     Other
      Information
                                
                                18Item 6.     Exhibits
                                
                                19SIGNATURES
                                
                                20








1
 Table of Contents




Part
      I - Financial InformationItem
      1.  Financial StatementsRIDGEWOOD
      ENERGY M FUND, LLCUNAUDITED
      CONDENSED BALANCE SHEETS(in
      thousands, except share amounts)September
      30, 2008
                                                        
                                                        
                                                        December
      31, 2007ASSETSCurrent
      assets:Cash
      and cash equivalents
                                                        
                                                        $
                                                        6,467
                                                        
                                                        
                                                        $
                                                        8,163Short-term
      investment in marketable securities
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        5,075Production
      receivable
                                                        
                                                        
                                                        31
                                                        
                                                        
                                                        
                                                        119Other
      current assets
                                                        
                                                        
                                                        245
                                                        
                                                        
                                                        
                                                        99Total
      current assets
                                                        
                                                        
                                                        6,743
                                                        
                                                        
                                                        
                                                        13,456Salvage
      fund
                                                        
                                                        
                                                        1,132
                                                        
                                                        
                                                        
                                                        1,111Oil
      and gas properties:Advances
      to operators for working interests and expenditures
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        66Unproved
      properties
                                                        
                                                        
                                                        3,879
                                                        
                                                        
                                                        
                                                        7,357Proved
      properties
                                                        
                                                        
                                                        22,816
                                                        
                                                        
                                                        
                                                        15,033Less:
      accumulated depletion and amortization
                                                        
                                                        
                                                        (8,375
                                                        )
                                                        
                                                        
                                                        (7,909
                                                        )Total
      oil and gas properties, net
                                                        
                                                        
                                                        18,320
                                                        
                                                        
                                                        
                                                        14,547Total
      assets
                                                        
                                                        $
                                                        26,195
                                                        
                                                        
                                                        $
                                                        29,114LIABILITIES
      AND MEMBERS' CAPITALCurrent
      liabilities:Due
      to operators
                                                        
                                                        $
                                                        277
                                                        
                                                        
                                                        $
                                                        1,367Accrued
      expenses payable
                                                        
                                                        
                                                        89
                                                        
                                                        
                                                        
                                                        137Total
      current liabilities
                                                        
                                                        
                                                        366
                                                        
                                                        
                                                        
                                                        1,504Asset
      retirement obligations
                                                        
                                                        
                                                        676
                                                        
                                                        
                                                        
                                                        476Total
      liabilities
                                                        
                                                        
                                                        1,042
                                                        
                                                        
                                                        
                                                        1,980Commitments
      and contingencies (Note 8)Members'
      capital:Manager:Distributions
                                                        
                                                        
                                                        (1,402
                                                        )
                                                        
                                                        
                                                        (1,402
                                                        )Retained
      earnings
                                                        
                                                        
                                                        28
                                                        
                                                        
                                                        
                                                        97Manager's
      total
                                                        
                                                        
                                                        (1,374
                                                        )
                                                        
                                                        
                                                        (1,305
                                                        )Shareholders:Capital
      contributions (834 shares authorized;  535.6818 issued
      and
                                                          outstanding)
                                                        
                                                        
                                                        78,887
                                                        
                                                        
                                                        
                                                        78,887Syndication
      costs
                                                        
                                                        
                                                        (8,597
                                                        )
                                                        
                                                        
                                                        (8,597
                                                        )Distributions
                                                        
                                                        
                                                        (7,945
                                                        )
                                                        
                                                        
                                                        (7,945
                                                        )Accumulated
      deficit
                                                        
                                                        
                                                        (35,818
                                                        )
                                                        
                                                        
                                                        (33,906
                                                        )Shareholders'
      total
                                                        
                                                        
                                                        26,527
                                                        
                                                        
                                                        
                                                        28,439Total
      members' capital
                                                        
                                                        
                                                        25,153
                                                        
                                                        
                                                        
                                                        27,134Total
      liabilities and members' capital
                                                        
                                                        $
                                                        26,195
                                                        
                                                        
                                                        $
                                                        29,114The
      accompanying notes are an integral part of these unaudited condensed
      financial statements.




2
 Table of Contents




RIDGEWOOD
      ENERGY M FUND, LLCUNAUDITED
      CONDENSED STATEMENTS OF OPERATIONS(in
      thousands, except share amounts)Three
      months ended September 30,
                                                                                                      
                                                                                                      
                                                                                                      Nine
      months ended September 30,2008
                                                                                                      
                                                                                                      
                                                                                                      2007
                                                                                                      
                                                                                                      
                                                                                                      2008
                                                                                                      
                                                                                                      
                                                                                                      2007RevenueOil
      and gas revenue
                                                                                                      
                                                                                                      $
                                                                                                      417
                                                                                                      
                                                                                                      
                                                                                                      $
                                                                                                      685
                                                                                                      
                                                                                                      
                                                                                                      $
                                                                                                      1,045
                                                                                                      
                                                                                                      
                                                                                                      $
                                                                                                      3,238ExpensesDepletion
      and amortization
                                                                                                      
                                                                                                      
                                                                                                      148
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      209
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      466
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      984Dry-hole
      costs
                                                                                                      
                                                                                                      
                                                                                                      (4
                                                                                                      )
                                                                                                      
                                                                                                      
                                                                                                      257
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      1,699
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      211Management
      fees to affiliate (Note 6)
                                                                                                      
                                                                                                      
                                                                                                      -
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      269
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      -
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      914Impairment
      of proved property
                                                                                                      
                                                                                                      
                                                                                                      -
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      2,943
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      (471
                                                                                                      )
                                                                                                      
                                                                                                      
                                                                                                      2,943Operating
      expenses
                                                                                                      
                                                                                                      
                                                                                                      146
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      122
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      1,103
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      750General
      and administrative expenses
                                                                                                      
                                                                                                      
                                                                                                      122
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      124
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      396
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      438Total
      expenses
                                                                                                      
                                                                                                      
                                                                                                      412
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      3,924
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      3,193
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      6,240Income
      (loss) from operations
                                                                                                      
                                                                                                      
                                                                                                      5
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      (3,239
                                                                                                      )
                                                                                                      
                                                                                                      
                                                                                                      (2,148
                                                                                                      )
                                                                                                      
                                                                                                      
                                                                                                      (3,002
                                                                                                      )Other
      incomeInterest
      income
                                                                                                      
                                                                                                      
                                                                                                      31
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      224
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      167
                                                                                                      
                                                                                                      
                                                                                                      
                                                                                                      759Net
      income (loss)
                                                                                                      
                                                                                                      $
                                                                                                      36
                                                                                                      
                                                                                                      
                                                                                                      $
                                                                                                      (3,015
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (1,981
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (2,243
                                                                                                      )Manager
      InterestNet
      income (loss)
                                                                                                      
                                                                                                      $
                                                                                                      33
                                                                                                      
                                                                                                      
                                                                                                      $
                                                                                                      (409
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (69
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (260
                                                                                                      )Shareholder
      InterestNet
      income (loss)
                                                                                                      
                                                                                                      $
                                                                                                      3
                                                                                                      
                                                                                                      
                                                                                                      $
                                                                                                      (2,606
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (1,912
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (1,983
                                                                                                      )Net
      income (loss) per share
                                                                                                      
                                                                                                      $
                                                                                                      6
                                                                                                      
                                                                                                      
                                                                                                      $
                                                                                                      (4,865
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (3,569
                                                                                                      )
                                                                                                      
                                                                                                      $
                                                                                                      (3,702
                                                                                                      )The
      accompanying notes are an integral part of these unaudited condensed
      financial statements.




3
 Table of Contents




RIDGEWOOD
      ENERGY M FUND, LLCUNAUDITED
      CONDENSED STATEMENTS OF CASH FLOWS(in
      thousands)Nine
      months ended September 30,2008
                                                          
                                                          
                                                          2007Cash
      flows from operating activitiesNet
      loss
                                                          
                                                          $
                                                          (1,981
                                                          )
                                                          
                                                          $
                                                          (2,243
                                                          )Adjustments
      to reconcile net loss to net cash provided by operating
      activities:Depletion
      and amortization
                                                          
                                                          
                                                          466
                                                          
                                                          
                                                          
                                                          984Dry-hole
      costs
                                                          
                                                          
                                                          1,699
                                                          
                                                          
                                                          
                                                          211Impairment
      of proved property
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          2,943Settlement
      of asset retirement obligation
                                                          
                                                          
                                                          (38
                                                          )
                                                          
                                                          
                                                          -Accretion
      expense
                                                          
                                                          
                                                          11
                                                          
                                                          
                                                          
                                                          10Interest
      earned on marketable securities
                                                          
                                                          
                                                          (36
                                                          )
                                                          
                                                          
                                                          (328
                                                          )Changes
      in assets and liabilities:Decrease
      in production receivable
                                                          
                                                          
                                                          88
                                                          
                                                          
                                                          
                                                          396Increase
      in other current assets
                                                          
                                                          
                                                          (61
                                                          )
                                                          
                                                          
                                                          (336
                                                          )Increase
      (decrease) in due to operators
                                                          
                                                          
                                                          24
                                                          
                                                          
                                                          
                                                          (87
                                                          )Decrease
      in accrued expenses payable
                                                          
                                                          
                                                          (48
                                                          )
                                                          
                                                          
                                                          (64
                                                          )Net
      cash provided by operating activities
                                                          
                                                          
                                                          124
                                                          
                                                          
                                                          
                                                          1,486Cash
      flows from investing activitiesCapital
      expenditures for oil and gas properties
                                                          
                                                          
                                                          (6,910
                                                          )
                                                          
                                                          
                                                          (4,290
                                                          )Interest
      reinvested in salvage fund
                                                          
                                                          
                                                          (21
                                                          )
                                                          
                                                          
                                                          (38
                                                          )Proceeds
      from the maturity of marketable securities
                                                          
                                                          
                                                          5,111
                                                          
                                                          
                                                          
                                                          24,704Investment
      in marketable securities
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          (13,739
                                                          )Net
      cash (used in) provided by investing activities
                                                          
                                                          
                                                          (1,820
                                                          )
                                                          
                                                          
                                                          6,637Cash
      flows from financing activitiesDistributions
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          (3,237
                                                          )Net
      cash used in financing activities
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          (3,237
                                                          )Net
      (decrease) increase in cash and cash equivalents
                                                          
                                                          
                                                          (1,696
                                                          )
                                                          
                                                          
                                                          4,886Cash
      and cash equivalents, beginning of period
                                                          
                                                          
                                                          8,163
                                                          
                                                          
                                                          
                                                          7,508Cash
      and cash equivalents, end of period
                                                          
                                                          $
                                                          6,467
                                                          
                                                          
                                                          $
                                                          12,394Supplemental
      schedule of non-cash investing activitiesAdvances
      used for capital expenditures in oil and gas
                                                            properties
      reclassified to proved properties
                                                          
                                                          $
                                                          66
                                                          
                                                          
                                                          $
                                                          -The
      accompanying notes are an integral part of these unaudited condensed
      financial statements.




4
 Table of Contents




RIDGEWOOD
ENERGY M FUND, LLC


NOTES
TO UNAUDITED CONDENSED FINANCIAL STATEMENTS








1.
            Organization
      and Purpose





The
Ridgewood Energy M Fund, LLC (the “Fund”), a Delaware limited liability company,
was formed on August 2, 2004 and operates pursuant to a limited liability
company agreement (the “LLC agreement”) dated as of September 7, 2004 by and
among Ridgewood Energy Corporation (the “Manager”) and the shareholders of the
Fund. The Fund was organized to acquire interests in oil and gas properties
located in the United States offshore waters of Texas, Louisiana, and Alabama in
the Gulf of Mexico.





The
Manager performs, or arranges for the performance of, the management and
administrative services required for Fund operations. Such services include,
without limitation, the administration of shareholder accounts, shareholder
relations and the preparation, review and dissemination of tax and other
financial information.  In addition, the Manager provides office
space, equipment and facilities and other services necessary for Fund
operations.  The Manager also engages and manages the contractual
relations with unaffiliated custodians, depositories, accountants, attorneys,
broker-dealers, corporate fiduciaries, insurers, banks and others as required
(Notes 2, 6 and 8).





2.
            Summary
      of Significant Accounting Policies





Basis
of Presentation


These
unaudited interim condensed financial statements have been prepared by the
Fund’s management in accordance with accounting principles generally accepted in
the United States of America (“GAAP”) and in the opinion of management, contain
all adjustments (consisting of only normal recurring adjustments) necessary to
present fairly the Fund’s financial position, results of operations and cash
flows for the periods presented.  Certain information and note
disclosures normally included in annual financial statements prepared in
accordance with GAAP have been omitted in these unaudited interim condensed
financial statements.  The results of operations, financial position,
and cash flows for the periods presented herein are not necessarily indicative
of future financial results.  These unaudited interim condensed
financial statements should be read in conjunction with the annual financial
statements and the notes thereto for the year ended December 31, 2007 included
in the Fund’s Annual Report on Form 10-K filed with the Securities and Exchange
Commission (the “SEC”).  The year-end condensed balance sheet data was
derived from audited financial statements, but does not include all disclosures
required by GAAP.





Use
of Estimates


The
preparation of financial statements in conformity with GAAP 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 financial statements and the reported amounts of revenues and expenses
during the reporting period. On an ongoing basis, the Manager reviews its
estimates, including those related to amounts advanced to and billed by
operators, determination of proved reserves, impairments and asset retirement
obligations.  Actual results may differ from those estimates.





Cash
and Cash Equivalents


All
highly liquid investments with maturities when purchased of three months or less
are considered cash and cash equivalents. At times, bank deposits may be in
excess of federally insured limits.  At September 30, 2008 and
December 31, 2007, bank balances, inclusive of salvage fund, exceeded federally
insured limits by approximately $6.3 million and $8.0 million,
respectively.  At September 30, 2008, $6.2 million of the Fund’s
uninsured balances were invested in money market accounts that invest solely in
U.S. Treasury bills and notes.  The Fund maintains bank deposits with
accredited financial institutions. Effective October 3, 2008 through December
31, 2009, federally insured limits have been increased from $0.1 million to
$0.25 million.





Investments
in Marketable Securities


At times
the Fund may invest in U. S. Treasury bills and notes.  These
investments are considered short-term when their maturities, when purchased, are
greater than three months and one year or less, and long-term when their
maturities are in excess of twelve months.  At December 31, 2007, the
Fund had short-term held-to-maturity investments totaling $5.1
million.  Held-to-maturity securities are those investments that the
Fund has the ability and intent to hold until maturity, and are recorded at cost
plus accrued income, adjusted for the amortization of premiums and discounts,
which approximate fair value.  At September 30, 2008, the Fund had no
short-term investments in marketable securities.




5
 Table of Contents




For all
investments, interest income is accrued as earned and amortization of premium or
discount, if any, is included in interest income.





Salvage
Fund


The Fund
deposits in a separate interest-bearing account, or a salvage fund, money to
provide for dismantling production platforms and facilities, plugging and
abandoning the wells and removing the platforms, facilities and wells after
their useful lives, in accordance with applicable federal and state laws and
regulations.  At September 30, 2008 and December 31, 2007, the Fund
had held-to-maturity investments within its salvage fund totaling $1.1
million.  The held-to-maturity investment held within the salvage fund
at September 30, 2008 matures in February 2012.





Interest
earned on the account will become part of the salvage fund.  There are
no restrictions on withdrawals from the salvage fund.





Oil
and Gas Properties


Investments
in oil and gas properties are operated by unaffiliated entities (“Operators”)
who are responsible for drilling, administering and producing activities
pursuant to the terms of the applicable operating agreements with working
interest owners.  The Fund's portion of exploration, drilling,
operating and capital equipment expenditures relating to the wells are advanced
and billed by Operators through authorization for expenditures.





The
successful efforts method of accounting for oil and gas producing activities is
followed. Acquisition costs are capitalized when incurred.  Other oil
and gas exploration costs, excluding the costs of drilling exploratory wells,
are charged to expense as incurred.  The costs of drilling exploratory
wells are capitalized pending the determination of whether the wells have
discovered proved commercial reserves.  If proved commercial reserves
have not been found, exploratory drilling costs are expensed to dry-hole
expense.  Costs to develop proved reserves, including the costs of all
development wells and related facilities and equipment used in the production of
crude oil and gas, are capitalized.  Expenditures for ongoing repairs
and maintenance of producing properties are expensed as incurred.





Upon the
sale or retirement of a proved property, the cost and related accumulated
depletion and amortization will be eliminated from the property accounts, and
the resultant gain or loss is recognized.  Upon the sale or retirement
of an unproved property, gain or loss on the sale is recognized.  The
Manager does not currently intend to sell any of the Fund’s property
interests.





Capitalized
acquisition costs of producing oil and gas properties are depleted by the
units-of-production method.





As of
September 30, 2008, $0.2 million was recorded in due to operators related to
capital expenditures for oil and gas properties.





Advances
to Operators for Working Interests and Expenditures


The
Fund’s acquisition of a working interest in a well or a project may require it
to make a payment to the seller for the Fund’s right, title and
interest.  The Fund may be required to advance its share of estimated
cash expenditures for the succeeding month’s operation. The Fund accounts for
such payments as advances to operators for working interests and
expenditures.  As drilling costs are incurred, the advances are
transferred to unproved properties.





Asset
Retirement Obligations


For oil
and gas properties, there are obligations to perform removal and remediation
activities when the properties are retired.  When a project reaches
drilling depth and is determined to be either proved or dry, an asset retirement
obligation is incurred.  Plug and abandonment costs associated with
unsuccessful properties are expensed as dry-hole costs.  The table
below presents changes in the asset retirement obligations for the nine months
ended September 30, 2008 and the year ended December 31, 2007.




6
 Table of Contents


September
      30, 2008
                              
                              
                              December
      31, 2007(in
      thousands)Balance,
      beginning of period
                              
                              $
                              476
                              
                              
                              $
                              225Liabilities
      incurred
                              
                              
                              227
                              
                              
                              
                              222Revision
      to prior estimate
                              
                              
                              -
                              
                              
                              
                              16Liabilities
      settled
                              
                              
                              (38
                              )
                              
                              
                              -Accretion
      expense
                              
                              
                              11
                              
                              
                              
                              13Balance,
      end of period
                              
                              $
                              676
                              
                              
                              $
                              476




As
indicated above, the Fund maintains a salvage fund to provide for the funding of
future asset retirement obligations.





Syndication
Costs


Syndication
costs are direct costs associated with offering the Fund’s shares including
professional fees, selling expenses and administrative costs payable to the
Manager, an affiliate of the Manager and unaffiliated broker-dealers, which are
reflected on the Fund’s balance sheet as a reduction of shareholders’
capital.





Revenue
Recognition and Imbalances


Oil and
gas revenues are recognized when production is sold to a purchaser at a
fixed or determinable price, when delivery has occurred and title has
transferred, and if collectibility of the revenue is
probable.





The Fund
uses the sales method of accounting for gas production imbalances. The volumes
of gas sold may differ from the volumes to which the Fund is entitled based on
its interests in the properties. These differences create imbalances that are
recognized as a liability only when the properties’ estimated remaining reserves
net to the Fund will not be sufficient to enable the underproduced owner to
recoup its entitled share through production. The Fund’s recorded liability, if
any, would be reflected in other non-current liabilities. No receivables are
recorded for those wells where the Fund has taken less than its share of
production. Gas imbalances are reflected as adjustments to estimates of proved
gas reserves and future cash flows.





Impairment
of Long-Lived Assets


In
accordance with the provisions of the Statement of Financial Accounting
Standards (“SFAS”) No. 144, “Accounting for the Impairment of Long-Lived
Assets”, long-lived assets, such as oil and gas properties, are evaluated
when events or changes in circumstances indicate the carrying value of such
assets may not be recoverable. The determination of whether impairment has
occurred is made by comparing the carrying values of long-lived assets to
the estimated future undiscounted cash flows attributable to the asset. The
impairment loss recognized is the excess of the carrying value over the future
discounted cash flows attributable to the asset or the estimated fair value of
the asset.  During the nine months ended September 30, 2008, the Fund
recorded an adjustment of $0.5 million related to the impairment charge to
Eugene Island 364 that was recorded in the fourth quarter of
2007.   The adjustment is related to a credit from the operator
upon a review of well costs.





At
September 30, 2007, the Fund recorded an impairment of $2.9 million related to
the Eugene Island 337 lease block based upon futures pricing on the date of the
calculation.  When the well began producing in November 2007, the
production flow rate was lower than originally expected, and as such, internal
engineering estimates of the proved reserves were prepared.  An
analysis of such estimates, utilizing sales prices in effect as of the date of
the reserve estimate calculation, resulted in an impairment in accordance with
SFAS No. 144.





Depletion
and Amortization


Depletion
and amortization of the cost of proved oil and gas properties are calculated
using the units-of-production method.  Proved developed reserves are
used as the base for depleting the cost of successful exploratory drilling and
development costs.  The sum of proved developed and proved undeveloped
reserves is used as the base for depleting, or amortizing, leasehold acquisition
costs, the costs to acquire proved properties, platform and pipeline
costs.





Income
Taxes


No
provision is made for income taxes in the financial statements.  The
Fund is a limited liability company, and as such the Fund’s income or loss is
passed through and included in the tax returns of the Fund’s
shareholders.




7
 Table of Contents




Income
and Expense Allocation


Profits
and losses are allocated 85% to shareholders in proportion to their relative
capital contributions and 15% to the Manager, except for interest income and
certain expenses such as dry hole costs, fiduciary fees, depletion and
amortization which are allocated 99% to shareholders and 1% to the
Manager.





3.
            Recent
      Accounting Standards





In May
2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 162,
“The Hierarchy of Generally Accepted Accounting Principles,” (“SFAS No.162”),
which identifies the sources of accounting principles and the framework for
selecting the principles used in the preparation of financial statements that
are presented in conformity with GAAP.  SFAS No. 162 will be effective
sixty days following the Securities and Exchange Commission’s approval of the
Public Company Accounting Oversight Board amendments to AU Section
411.  The Fund does not expect the adoption of SFAS No. 162 will have
a material impact on its financial condition or results of
operation.





In
September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements,” (“SFAS
No.157”), which applies under most other accounting pronouncements that require
or permit fair value measurements. SFAS No. 157 provides a common definition of
fair value as the price that would be received to sell an asset or paid to
transfer a liability in a transaction between market participants. The new
standard also provides guidance on the methods used to measure fair value and
requires expanded disclosures related to fair value
measurements.  SFAS No. 157 had originally been effective for
financial statements issued for fiscal years beginning after November 15, 2007,
however the FASB has agreed on a one year deferral for all non-financial assets
and liabilities. On January 1, 2008, the Fund adopted SFAS No.157 for financial
assets and liabilities.





4.
            Unproved
      Properties - Capitalized Exploratory Well
Costs





Leasehold
acquisition and exploratory drilling costs are capitalized pending determination
of whether the well has found proved reserves.  Unproved properties
are assessed on a quarterly basis by evaluating and monitoring if sufficient
progress is made on accessing the reserves.





At
September 30, 2008, the Fund had two properties, Vermilion 344 and South Marsh
Island 111, with capitalized expenditures in excess of one year.  Both
projects have been determined to be successful, and production facilities are
being completed, with production expected during the fourth quarter of
2008.  Capitalized exploratory well costs related to Vermillion 344 at
September 30, 2008 and December 31, 2007 were $2.1 million and $1.1 million,
respectively.    Capitalized exploratory well costs related
to South Marsh Island 111 at September 30, 2008 and December 31, 2007 were $1.6
million and $1.0 million, respectively.  The following table reflects
the net changes in unproved properties for the nine months ended September 30,
2008 and the year ended December 31, 2007.





September
      30, 2008
                      
                      
                      December
      31, 2007(in
      thousands)Balance,
      beginning of period
                      
                      $
                      7,357
                      
                      
                      $
                      5,355Additions
      to capitalized exploratory well costs pending the
                        determination
      of proved reserves
                      
                      
                      3,655
                      
                      
                      
                      7,960Reclassification
      to proved properties based on the
                        determination
      of proved reserves
                      
                      
                      (7,133
                      )
                      
                      
                      (5,958
                      )Capitalized
      exploratory well costs charged to dry-hole costs
                      
                      
                      -
                      
                      
                      
                      -Balance,
      end of period
                      
                      $
                      3,879
                      
                      
                      $
                      7,357




Capitalized
exploratory costs are expensed as dry-hole costs in the event that reserves are
not found or are not in sufficient quantities to complete the well and develop
the field.  During the three months ended September 30, 2008 and the
three and nine months ended September 30, 2007, certain wells received credits
from their respective operators based upon review and audits of the wells’
costs.  Dry-hole costs, inclusive of credits, are detailed in the
table below.




8
 Table of Contents




Three
      months ended September 30,
                                      
                                      
                                      Nine
      months ended September 30,Lease
      Block
                                      
                                      2008
                                      
                                      
                                      2007
                                      
                                      
                                      2008
                                      
                                      
                                      2007(in
      thousands)South
      Marsh 213
                                      
                                      $
                                      -
                                      
                                      
                                      $
                                      -
                                      
                                      
                                      $
                                      1,688
                                      
                                      
                                      $
                                      -Ship
      Shoal 81
                                      
                                      
                                      (4
                                      )
                                      
                                      
                                      262
                                      
                                      
                                      
                                      9
                                      
                                      
                                      
                                      262Main
      Pass 155
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (1
                                      )
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (47
                                      )Other
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (4
                                      )
                                      
                                      
                                      2
                                      
                                      
                                      
                                      (4
                                      )$
                                      (4
                                      )
                                      
                                      $
                                      257
                                      
                                      
                                      $
                                      1,699
                                      
                                      
                                      $
                                      211






5.
            Distributions





Distributions
to shareholders are allocated in proportion to the number of shares
held.





The
Manager determines whether available cash from operations, as defined in the
Fund's LLC Agreement, is to be distributed.  Such distributions are
allocated 85% to the shareholders and 15% to the Manager, as defined in the
Fund's LLC Agreement.





Available
cash from dispositions, as defined in the Fund's LLC Agreement, is paid 99% to
shareholders and 1% to the Manager until the shareholders have received total
distributions equal to their capital contributions. After shareholders have
received distributions equal to their capital contributions, 85% of available
cash from dispositions will be distributed to shareholders and 15% to the
Manager.





There
were no distributions paid to the shareholders or the Manager during the nine
months ended September 30, 2008.  Distributions to the Fund’s
shareholders and the Manager during the nine months ended September 30, 2007
were $2.8 million and $0.5 million, respectively.





6.
            Related
      Parties





The
Fund’s LLC Agreement provides that the Manager render management, administrative
and advisory services, for which the Manger is entitled to receive a management
fee.  Beginning on October 1, 2007 and continuing for the remaining
life of the Fund, the Manager elected to waive its management
fee.  Management fees of $0.3 million and $0.9 million were incurred
during the three and nine months ended September 30, 2007,
respectively.  Upon the waiver of the management fee, the Fund began
recording costs relating to services provided by the Manager for accounting and
investor relations.  Such costs totaled $20 thousand and $60 thousand
for the three and nine months ended September 30, 2008, respectively, and were
included in general and administrative expenses.





From time
to time, short-term payables and receivables, which do not bear interest, arise
from transactions with affiliates in the ordinary course of
business.  At September 30, 2008 there were no such amounts
outstanding.  At December 31, 2007 the Fund owed the Manager $6
thousand related to revenue allocations, which is included in accrued expenses
payable.





None of
the compensation to be received by the Manager has been derived as a result of
arm’s length negotiations.





The Fund
has working interest ownership in certain projects to acquire and develop oil
and gas projects with other entities that are likewise managed by the
Manager.





7.
            Fair
      Value of Financial Instruments and
Measurements





As of
September 30, 2008 and December 31, 2007, the carrying value of cash and cash
equivalents, short-term investments in marketable securities, salvage fund,
production receivable and accrued expenses approximated fair value.





8.
            Commitments
      and Contingencies





Capital
Commitments


The Fund
has entered into multiple offshore operating agreements for the drilling and
development of its investment properties. The estimated capital expenditures
associated with these agreements vary depending on the stage of development on a
property-by-property basis. As of September 30, 2008, the Fund had committed to
spend an additional $5.3 million related to its investment
properties.




9
 Table of Contents




Environmental
Considerations


The
exploration for and development of oil and gas involves the extraction,
production and transportation of materials which, under certain conditions, can
be hazardous or cause environmental pollution problems.  The Operators
are continually taking action they believe appropriate to satisfy applicable
federal, state and local environmental regulations and do not currently
anticipate that compliance with federal, state and local environmental
regulations will have a material adverse effect upon capital expenditures,
results of operations or the competitive position of the Fund in the oil and gas
industry.  However, due to the significant public and governmental
interest in environmental matters related to those activities, the Manager
cannot predict the effects of possible future legislation, rule changes, or
governmental or private claims.  At September 30, 2008 and December
31, 2007, there were no known environmental contingencies that required the Fund
to record a liability.





Insurance
Coverage


The Fund
is subject to all risks inherent in the exploration for and development of oil
and gas. Insurance coverage as is customary for entities engaged in similar
operations is maintained, but losses may occur from uninsurable risks or amounts
in excess of existing insurance coverage. The occurrence of an event which is
not insured or not fully insured could have an adverse impact upon earnings and
financial position.  Moreover, insurance is obtained as a package
covering all of the Manager’s investment programs.  Claims made by
other such programs can reduce or eliminate insurance for the Fund.









10
 Table of Contents




ITEM
2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS





Cautionary
Statement Regarding Forward-Looking Statements





Certain
statements in this quarterly report on Form 10-Q (“Quarterly Report”) and
the documents Ridgewood Energy M Fund, LLC (the “Fund”) has incorporated by
reference into this Quarterly Report, other than purely historical information,
including estimates, projections, statements relating to the Fund’s business
plans, strategies, objectives and expected operating results, and the
assumptions upon which those statements are based, are “forward-looking
statements” within the meaning of the Private Securities Litigation Reform Act
of 1995, Section 27A of the Securities Act of 1933, as amended (the
“Securities Act”) and Section 21E of the Securities Exchange Act of 1934
(the “Exchange Act”). These forward-looking statements generally are identified
by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,”
“strategy,” “plan,” “target,” “pursue,” “may,” “will,” “would,” “will be,” “will
continue,” “will likely result,” and similar expressions. Forward-looking
statements are based on current expectations and assumptions that are subject to
risks and uncertainties which may cause actual results to differ materially from
the forward-looking statements.  Examples of such events that could
cause actual results to differ materially from historical results or those
anticipated include weather conditions, such as hurricanes, changes in market
conditions affecting the pricing of oil and gas, the cost and availability of
equipment, and changes in governmental regulations.  The Fund
undertakes no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise.





Critical
Accounting Policies and Estimates





The
following discussion and analysis of the Fund’s financial condition and
operating results is based on the Fund’s financial statements.  The
preparation of this Quarterly Report requires the Fund to make estimates and
assumptions that affect the reported amount of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the Fund’s
financial statements, and the reported amount of revenue and expenses during the
reporting period. Actual results may differ from those estimates and
assumptions.  See “Notes to Unaudited Condensed Financial Statements”
in Part I of this Quarterly Report for a presentation of the Fund’s significant
accounting policies.  No changes have been made to the Fund’s critical
accounting policies and estimates disclosed in its 2007 Annual Report on Form
10-K.





Overview
of the Fund’s Business





The Fund
is a Delaware limited liability company formed on August 2, 2004 to acquire
interests primarily in oil and gas projects located in the U.S. waters of the
Gulf of Mexico. Ridgewood Energy Corporation (“Ridgewood Energy” or the
“Manager”) a Delaware corporation, is the Manager. As the Manager, Ridgewood
Energy has direct and exclusive control over the management and control of Fund
operations. The Fund’s primary investment objective is to generate cash
flow for distribution to the Fund’s shareholders through participation in oil
and gas exploration and development projects in the Gulf of Mexico.





The
Manager performs certain duties on the Fund’s behalf including the evaluation of
potential projects for investment and ongoing management, administrative and
advisory services associated with these projects.  For these services,
the Manager had received an annual management fee, ranging from 1% to 2.5%
of total capital contributions, net of cumulative dry-hole and related well
costs incurred by the Fund.  On October 1, 2007, the Manager elected
to cease collecting its management fee for the remaining life of the Fund. The
Fund does not currently, nor is there any plan to operate any project in which
the Fund participates.  The Manager enters into operating agreements
with third-party operators (the “Operators”) for the management of all
exploration, development and producing operations, as appropriate.





Business
Update





The Fund
owns working interests and has participated in the drilling of fourteen
wells.  Four wells are currently producing and completion efforts are
ongoing for three wells.  The remaining seven wells have been
determined to be dry-holes or have been abandoned.




11
 Table of Contents




Recent
hurricane activity in the Gulf of Mexico has not caused material damage to any
of the Fund’s wells or facilities. However, damage to certain pipelines, coastal
refineries and gas processing plants have cause certain wells  to be
shut-down for several weeks or months.  Accordingly, several of the
Fund’s producing properties generated little or no revenue during the month of
September and one of the Fund’s wells will be offline for several
months.  The reserves associated with these properties remain intact
and the value of the properties is recoverable, however, the delay in production
and revenue will result in the delay in the payment of distributions related to
certain properties.





Currently
Drilling





Whistler
Project


In August
2008, the Fund acquired a 20% working interest in the Whistler Project, an
exploratory well, from Helis Oil & Gas Company, L.L.C. (“Helis”), the
operator.  This project is expected to begin drilling in November 2008
and results are expected in December 2008.  Through September 30,
2008, the Fund has spent $0.2 million on this well, for which the total
estimated budget is $3.5 million.





Successful
Projects





West
Cameron 57


In
September 2007, the Fund acquired a 12.5% working interest in the West Cameron
57 project from Chevron U.S.A., Inc. (“Chevron”), the
operator.  Drilling began in October 2007, and the well was determined
to be a success in February 2008.  Completion efforts are currently in
process, and production is expected in November
2008.  Through September 30, 2008, the Fund has spent $4.6
million on this well, for which the total estimated budget is $5.4
million





West
Cameron 77 #2 (Mustang)


In 2004,
the Fund acquired a 14.54% working interest in the West Cameron 77 #2 Mustang
project from BHP Billiton Petroleum (Americas) Inc. (“BHP”), the
operator.  The well began production in May 2006.  During
the fourth quarter of 2007 production in the lower reservoir zone ceased and in
early-2008 BHP re-completed the upper reservoir zone.  Production
resumed in February 2008, however the well is currently off-line while the Fund
and BHP determine the maintenance plan necessary to resume
production.  The total capitalized cost of this property was $8.8
million.  During the nine months ended September 30, 2008, the Fund
incurred $0.9 million of workover costs related to this well.





LLOG
Projects


In
October 2006, the Fund acquired an 8.75% working interest in six exploratory
wells to be drilled by LLOG Exploration Company (“LLOG”), the operator, off the
coast of Louisiana.  Of the six wells, the Fund elected not to proceed
with one well and one well was determined to be a dry hole.





The
remaining four LLOG wells, as detailed below, have been determined to be
successful and completion efforts are ongoing for two wells.  The
total budget for these projects is $7.8 million, of which $6.6 million has been
spent through September 30, 2008.





South
      Marsh Island 111
                    Discovery
      July 2007; Production expected December 2008Vermilion
      344
                    Discovery
      January 2007; Production expected November 2008West
      Delta 68
                    Discovery
      March 2007; Production commenced July 2008; shut-in for approximately
      three weeks during September 2008 due to hurricane
  activityWest
      Delta 67
                    Discovery
      November 2007; Production commenced July 2008; shut-in for approximately
      three weeks during September 2008 due to hurricane
  activity





12
 Table of Contents





Eugene Island
337


In 2006,
the Fund acquired a 20% working interest in the Eugene Island 337 project
from Devon Energy Corporation (“Devon”), the operator.  The property
was determined to be a commercial success in July 2006 and production commenced
in November 2007.  The total cost of this property was $6.1 million,
of which impairment costs totaling $4.9 million were recorded during the year
ended December 31, 2007.  No impairments were taken during the three
and nine months ended September 30, 2008.





As
indicated above in the business update, none of the Fund’s wells, including the
Eugene Island 337 well, were materially damaged as a result of recent hurricane
activity in the Gulf of Mexico.  However, the pipeline utilized to
transport this well’s oil and gas production has suffered damage thereby
shutting down production for this well.  As a result, this well will
be shut-in until the pipeline repairs are completed by its
owner.  There is no cost to the Fund related to these repair
activities, however, this well will not produce oil and gas or earn revenue
during this period.  The Eugene Island 337 well is currently expected
to resume production during the first quarter 2009.





Dry
Holes / Abandonment





South
Marsh Island 213


In March
2008, the Fund acquired a 5.5% working interest in the exploratory project South
Marsh Island 213 from LLOG, the operator.  This project began drilling
in March 2008.  On April 30, 2008 the Fund was informed by LLOG that
the well being drilled on the South Marsh Island 213 lease block did not have
commercially productive quantities of either gas or oil and had been deemed an
unsuccessful well, or dry hole.  Dry-hole costs related to this well,
including plug and abandonment expenses, for the nine months ended September 30,
2008 were $1.7 million.





Eugene Island
364


In 2006,
the Fund acquired a 50% working interest in Eugene Island 364 from El Paso
E&P Company (“El Paso”), the operator.  The well produced for a
short time in 2006 but had been shut-in since August 2006 due to mechanical
problems.  At December 31, 2007, the Fund concluded that it was
no longer economical to proceed with recovery efforts and the well was
abandoned.  The total cost of this property was $13.3 million, of
which impairment costs totaling $11.4 million were recorded during the year
ended December 31, 2007.  During the nine months ended September 30,
2008, the Eugene Island 364 project received credits totaling $0.5 million from
the operator upon review of the well costs.





Results
of Operations





The
following review of operations for the three and nine months ended September 30,
2008 and 2007 should be read in conjunction with the Fund’s financial statements
and the notes thereto.




13
 Table of Contents




Three
      months ended September 30,
                                    
                                    
                                    Nine
      months ended September 30,2008
                                    
                                    
                                    2007
                                    
                                    
                                    2008
                                    
                                    
                                    2007(in
      thousands)RevenueOil
      and gas revenue
                                    
                                    $
                                    417
                                    
                                    
                                    $
                                    685
                                    
                                    
                                    $
                                    1,045
                                    
                                    
                                    $
                                    3,238ExpensesDepletion
      and amortization
                                    
                                    
                                    148
                                    
                                    
                                    
                                    209
                                    
                                    
                                    
                                    466
                                    
                                    
                                    
                                    984Dry-hole
      costs
                                    
                                    
                                    (4
                                    )
                                    
                                    
                                    257
                                    
                                    
                                    
                                    1,699
                                    
                                    
                                    
                                    211Management
      fees to affiliate
                                    
                                    
                                    -
                                    
                                    
                                    
                                    269
                                    
                                    
                                    
                                    -
                                    
                                    
                                    
                                    914Impairment
      of proved property
                                    
                                    
                                    -
                                    
                                    
                                    
                                    2,943
                                    
                                    
                                    
                                    (471
                                    )
                                    
                                    
                                    2,943Operating
      expenses
                                    
                                    
                                    146
                                    
                                    
                                    
                                    122
                                    
                                    
                                    
                                    1,103
                                    
                                    
                                    
                                    750General
      and administrative expenses
                                    
                                    
                                    122
                                    
                                    
                                    
                                    124
                                    
                                    
                                    
                                    396
                                    
                                    
                                    
                                    438Total
      expenses
                                    
                                    
                                    412
                                    
                                    
                                    
                                    3,924
                                    
                                    
                                    
                                    3,193
                                    
                                    
                                    
                                    6,240Income
      (loss) from operations
                                    
                                    
                                    5
                                    
                                    
                                    
                                    (3,239
                                    )
                                    
                                    
                                    (2,148
                                    )
                                    
                                    
                                    (3,002
                                    )Other
      incomeInterest
      income
                                    
                                    
                                    31
                                    
                                    
                                    
                                    224
                                    
                                    
                                    
                                    167
                                    
                                    
                                    
                                    759Net
      income (loss)
                                    
                                    $
                                    36
                                    
                                    
                                    $
                                    (3,015
                                    )
                                    
                                    $
                                    (1,981
                                    )
                                    
                                    $
                                    (2,243
                                    )






As
previously discussed in “Business Update”, hurricane activity in the third
quarter of 2008 did not cause material damage to any of the Fund’s wells or
facilities, however, damage to certain pipelines, coastal refineries and gas
processing plants have caused certain wells to be shut-down for several weeks or
months.  Accordingly, revenues and depletion and amortization were
affected in August 2008 and September 2008 and will continue to be affected
during these periods of shut-down.





Oil and Gas
Revenue.During the three months
ended September 30, 2008, the Fund had three producing wells, Eugene Island 337
and West Delta 67/68 which came onto production in November 2007 and July 2008,
respectively.





Oil and
gas revenue for the three months ended September 30, 2008 was $0.4 million, a
$0.3 million decrease from the three months ended September 30,
2007.  The decrease is attributable to a decrease in production
and sales volumes of $0.4 million, partially offset by the impact of increased
average prices of $0.1 million.





The
Fund’s wells produced 2 thousand barrels of oil during the three months ended
September 30, 2008 compared to 1 thousand barrels of oil during the three months
ended September 30, 2007.  The Fund’s oil prices averaged $119 per
barrel and $76 per barrel during the three months ended September 30, 2008 and
2007, respectively.





Gas
production during the three months ended September 30, 2008 was 18 thousand mcf
compared to 85 thousand mcf, during the three months ended September 30,
2007.  The Fund’s gas prices averaged $9.89 per mcf and $6.85 per mcf
during the three months ended September 30, 2008 and 2007,
respectively.





Oil and
gas revenue for the nine months ended September 30, 2008 was $1.0 million, a
$2.2 million decrease from the nine months ended September 30,
2007.   The decrease is attributable to a decrease in production
and sales volumes totaling $2.5 million offset by the impact of increased
average prices totaling $0.3 million.





The
Fund’s wells produced 2 thousand barrels of oil during the nine months ended
September 30, 2008 compared to 5 thousand barrels during the nine months ended
September 30, 2007.  The Fund’s oil prices averaged $116 per barrel
and $64 per barrel during the nine months ended September 30, 2008 and 2007,
respectively.





Gas
production during the nine months ended September 30, 2008 was 80 thousand mcf
compared to 394 thousand mcf, during the nine months ended September 30,
2007.  The Fund’s gas prices averaged $9.61 per mcf and $7.46 per mcf
during the nine months ended September 30, 2008 and 2007,
respectively.




14
 Table of Contents




The
decrease in sales volumes for both the three and nine months ended September 30,
2008 was principally attributable to the West Cameron 77 Mustang well, which is
currently off-line while the Fund and BHP determine a maintenance
plan.  Additionally, sales volumes during the three months ended
September 30, 2008 were reduced due to the recent hurricane activity in the Gulf
of Mexico, which caused the West Delta 67/68 wells to be shut down for
approximately three weeks in September and has shut-in the Eugene Island
337 well.  See “Business Update” for additional
discussion.





Depletion and
Amortization.  For the three months ended September 30, 2008
and 2007, depletion and amortization was $0.1 million and $0.2 million,
respectively.  For the nine months ended September 30, 2008 and 2007,
depletion and amortization was $0.5 million and $1.0 million,
respectively.  The decrease is due to a decline in production from the
West Cameron 77 Mustang well, partially offset by the onset of production for
Eugene Island 337 in November 2007 as well as the West Delta 68 and West Delta
67 wells coming on production in July 2008.





Dry-hole
Costs.Dry-hole costs are those
costs incurred to drill and develop a well that is ultimately found to be
incapable of producing either oil or gas in sufficient quantities to justify
completion of the well. During the three months ended September 30, 2008 and the
three and nine months ended September 30, 2007, the Fund received credits from
operators of certain wells based upon review and audits of the wells costs
performed by working interest owners. The following table summarizes dry-hole
costs, inclusive of credits.





Three
      months ended September 30,
                                      
                                      
                                      Nine
      months ended September 30,Lease
      Block
                                      
                                      2008
                                      
                                      
                                      2007
                                      
                                      
                                      2008
                                      
                                      
                                      2007(in
      thousands)South
      Marsh 213
                                      
                                      $
                                      -
                                      
                                      
                                      $
                                      -
                                      
                                      
                                      $
                                      1,688
                                      
                                      
                                      $
                                      -Ship
      Shoal 81
                                      
                                      
                                      (4
                                      )
                                      
                                      
                                      262
                                      
                                      
                                      
                                      9
                                      
                                      
                                      
                                      262Main
      Pass 155
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (1
                                      )
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (47
                                      )Other
                                      
                                      
                                      -
                                      
                                      
                                      
                                      (4
                                      )
                                      
                                      
                                      2
                                      
                                      
                                      
                                      (4
                                      )$
                                      (4
                                      )
                                      
                                      $
                                      257
                                      
                                      
                                      $
                                      1,699
                                      
                                      
                                      $
                                      211





Management
Fees
to Affiliate.Management fees
for the three and nine months ended September 30, 2007 were $0.3 million and
$0.9 million, respectively.  Management fees are charged to cover
expenses associated with overhead incurred by the Manager for its ongoing
management, administrative and advisory services.  Such overhead
expenses include but are not limited to rent, payroll and benefits for employees
of the Manager, and other administrative costs. On October 1, 2007, the Manager
elected to waive its management fee for the remaining life of the
Fund.





Impairment of
Proved Property.During the nine months ended September 30,
2008, the Eugene Island 364 project, which had an impairment charge in the
fourth quarter of 2007, received credits totaling $0.5 million from the operator
upon review of the well costs.  During the three and nine months ended
September 30, 2007, the Fund recorded an impairment charge of $2.9 million
related to the Eugene Island 337 lease block.  When Eugene Island 337
began producing in November 2007, the production flow rate was lower than
originally expected, and as such, internal engineering estimates of the proved
reserves were prepared.  An analysis of such estimates, utilizing
sales prices in effect as of the date of the reserve estimate calculation,
resulted in an impairment in accordance with the provisions of the Statement of
Financial Accounting Standards No. 144, “Accounting for the Impairment of
Long-Lived Assets”.  There were no impairment charges during the three
months ended September 30, 2008.





Operating
Expenses.  Operating expenses represent the costs of operating
and maintaining wells and related facilities, geological costs and accretion
expense related to asset retirement obligations, as detailed in the schedule
below.





15
 Table of Contents




Three
      months ended September 30,
                                        
                                        
                                        Nine
      months ended September 30,2008
                                        
                                        
                                        2007
                                        
                                        
                                        2008
                                        
                                        
                                        2007(in
      thousands)Workover
      expenses
                                        
                                        $
                                        10
                                        
                                        
                                        $
                                        6
                                        
                                        
                                        $
                                        882
                                        
                                        
                                        $
                                        488Lease
      operating expenses
                                        
                                        
                                        60
                                        
                                        
                                        
                                        57
                                        
                                        
                                        
                                        135
                                        
                                        
                                        
                                        179Geological
      costs
                                        
                                        
                                        71
                                        
                                        
                                        
                                        56
                                        
                                        
                                        
                                        75
                                        
                                        
                                        
                                        73Accretion
                                        
                                        
                                        5
                                        
                                        
                                        
                                        3
                                        
                                        
                                        
                                        11
                                        
                                        
                                        
                                        10$
                                        146
                                        
                                        
                                        $
                                        122
                                        
                                        
                                        $
                                        1,103
                                        
                                        
                                        $
                                        750





Workover
expenses during the three and nine months ended September 30, 2008 were
attributable to the West Cameron 77 Mustang well.  Workover expenses
during the three and nine months ended September 30, 2007 were attributable to
the Eugene Island 364 well.  See additional discussion in “Business
Update” above. Lease operating expenses for the three and nine months ended
September 30, 2008 were primarily related to the Eugene Island 337 well, which
began producing in the fourth quarter of 2007 and the onset of production for
the West Delta 67 and 68 wells in July 2008.  Lease operating expenses
for the three and nine months ended September 30, 2007 were principally related
to the West Cameron 77 Mustang well.  Geological costs for the three
and nine months ended September 30, 2008 related primarily to the Whistler
project.  Geological costs for the three and nine months ended
September 30, 2007 related primarily to Eugene Island 364 and South Marsh Island
111.





General
and Administrative Expenses.General and administrative expenses
represent costs specifically identifiable or allocable to the Fund as detailed
in the schedule below.





Three
      months ended September 30,
                                                  
                                                  
                                                  Nine
      months ended September 30,2008
                                                  
                                                  
                                                  2007
                                                  
                                                  
                                                  2008
                                                  
                                                  
                                                  2007(in
      thousands)Insurance
                                                  
                                                  $
                                                  63
                                                  
                                                  
                                                  $
                                                  78
                                                  
                                                  
                                                  $
                                                  179
                                                  
                                                  
                                                  $
                                                  262Accounting
      fees
                                                  
                                                  
                                                  35
                                                  
                                                  
                                                  
                                                  38
                                                  
                                                  
                                                  
                                                  143
                                                  
                                                  
                                                  
                                                  150Management
      reimbursement
                                                  
                                                  
                                                  20
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  60
                                                  
                                                  
                                                  
                                                  -Trust
      fees and other
                                                  
                                                  
                                                  4
                                                  
                                                  
                                                  
                                                  8
                                                  
                                                  
                                                  
                                                  14
                                                  
                                                  
                                                  
                                                  26$
                                                  122
                                                  
                                                  
                                                  $
                                                  124
                                                  
                                                  
                                                  $
                                                  396
                                                  
                                                  
                                                  $
                                                  438




Insurance
expense represents premiums related to producing well and well control
insurance, which varies dependent upon the number of wells producing and/or
drilling and directors and officer’s liability policy, which is allocated by the
Manager to the Fund based on capital raised by the Fund to total capital raised
by all oil and gas funds managed by the Manager.  Accounting fees
represent annual audit and tax preparation fees, quarterly reviews and filing
fees of the Fund.  Management reimbursement relates to a reimbursement
to the Manager by the Fund for various administrative costs incurred by the
Manager on the Fund’s behalf for the three and nine months ended September 30,
2008.  Trust fees represent bank fees associated with the management
of the Fund’s cash accounts.





Interest
Income.Interest
income is comprised of interest earned on money market accounts and investments
in U.S. Treasury securities.  For the three months ended September 30,
2008 and 2007 interest income was $31 thousand and $0.2 million,
respectively.  For the nine months ended September 30, 2008 and 2007
interest income was $0.2 million and $0.8 million, respectively.  The
decreases during the three and nine months ended September 30, 2008 were
attributable to a reduction in the average outstanding balances earning interest
due to property expenditures during the period, coupled with lower interest
rates.





Capital
Resources and Liquidity





Operating Cash
Flows


Cash
flows provided by operating activities for the nine months ended September 30,
2008, were $0.1 million, primarily related to revenue received of $1.1 million,
credit received on a previously impaired well of $0.5 million and interest
received of $0.1 million.  These cash receipts were partially offset
by operating expenses paid of $1.1 million, general and administrative expenses
of $0.4 million and $0.1 million of unfavorable working capital.




16
 Table of Contents




Cash
flows provided by operating activities for the nine months ended September 30,
2007 were $1.5 million, primarily related to revenue received of $3.6 million
and interest received of $0.4 million, partially offset by management fees of
$0.9 million, operating expenses of $0.8 million, general and administrative
expenses of $0.4 million, an increase in insurance receivables of $0.2 million,
an increase in prepaid well costs of $0.1 million and $0.1 million of
unfavorable remaining working capital.





Investing
Cash Flows


Cash
flows used in investing activities for the nine months ended September 30, 2008
were $1.8 million, primarily related to capital expenditures for oil and gas
properties of $6.9 million, offset by proceeds from the maturity of marketable
securities of $5.1 million.  Additionally, the Fund increased its
salvage fund investments by $21 thousand, which consisted of the interest earned
on this account.





Cash
flows provided by investing activities for the nine months ended September 30,
2007 were $6.6 million, primarily related to the proceeds from the maturity of
marketable securities of $24.7 million partially offset by capital expenditures
for oil and gas properties of $4.3 million and investments in marketable
securities of $13.7 million.  Additionally, the Fund increased its
salvage fund investments by $38 thousand, which consisted of the interest earned
on this account.





Financing
Cash Flows


There
were no cash flows used in financing activities for the nine months ended
September 30, 2008.





Cash
flows used in financing activities for the nine months ended September 30, 2007
were $3.2 million, related to distributions paid to the Manager and
shareholders.





Estimated
Capital Expenditures





The Fund
has entered into multiple offshore operating agreements for the drilling and
development of its investment properties.  The estimated capital
expenditures associated with these agreements can vary depending on the stage of
development on a property-by-property basis.  As of September 30,
2008, the Fund had commitments related to participation agreements totaling $5.3
million for its investment properties.





When the
Manager makes a decision for participation in a particular project, it assumes
that the well will be successful and allocates enough capital to budget for the
completion of that well and the additional development wells and infrastructure
anticipated. If an exploratory well is deemed a dry hole or if it is
un-economical, the capital allocated to the completion of that well and to the
development of additional wells is then reallocated to a new project or used to
make additional investments.





Liquidity
Needs





The
Fund’s primary short-term liquidity needs are to fund its operations including
capital expenditures with existing cash on-hand, short-term investments and
income earned therefrom.





Distributions are
funded from cash flow from operations, and the frequency and amount are within
the Manager’s discretion subject to available cash from operations, reserve
requirements and Fund operations.





The
capital raised by the Fund in its private placement is more than likely all the
capital it will be able to obtain for investments in projects. The number of
projects in which the Fund can invest will naturally be limited and each
unsuccessful project the Fund experiences, if any, will not only reduce its
ability to generate revenue, but also exhaust its limited supply of capital.
Typically, the Manager seeks an investment portfolio that combines high and low
risk exploratory projects.





Off-Balance
Sheet Arrangements





The Fund
had no off-balance sheet arrangements as of September 30, 2008 and December 31,
2007 and does not anticipate the use of such arrangements in the
future.




17
 Table of Contents




Contractual
Obligations





The Fund
enters into operating agreements with operators.  On behalf of the Fund, an
operator enters into various contractual commitments pertaining to exploration,
development and production activities.  The Fund does not discuss or
negotiate any such contracts. No contractual obligations exist at September 30,
2008 and December 31, 2007 other than those discussed in “Estimated Capital
Expenditures” above.





ITEM
3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK





Not
required.





ITEM
4.  CONTROLS AND PROCEDURES





In
accordance with Exchange Act Rules 13a-15 and 15d-15, the Fund carried out
an evaluation, under the supervision and with the participation of management,
including its Chief Executive Officer and Chief Financial Officer, of the
effectiveness of our disclosure controls and procedures as of the end of the
period covered by this report.  Based on that evaluation, our Chief
Executive Officer and Chief Financial Officer concluded that the Fund’s
disclosure controls and procedures were effective as of September 30,
2008.




There has
been no change in the Fund’s internal control over financial reporting that
occurred during the three months ended September 30, 2008 that has materially
affected, or is reasonably likely to materially affect, the Fund’s internal
control over financial reporting.





PART
II.  OTHER INFORMATION





ITEM
1. LEGAL PROCEEDINGS





There
have been no changes to the legal proceedings disclosed in the Fund’s most
recent Annual Report on Form 10-K.





ITEM
1A. RISK FACTORS





Not
required.





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





None.





ITEM
3.  DEFAULTS UPON SENIOR SECURITIES





None.





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





None.





ITEM
5. OTHER INFORMATION





None.


18
 Table of Contents
 ITEM
6. EXHIBITS


10.1
                      
                      Participation
      Agreement between El Paso E&P Company, L.P. and Ridgewood Energy
      Corporation as Manager and LLOG Exploration Offshore, Inc. for South Marsh
      Island Block 213. (previously filed)10.2
                      
                      Participation
      Agreement between Helis Oil and Gas Company, L.L.C., Houston Energy, L.P.
      and Ridgewood Energy Corporation as Manager for Whistler
      Project.31.1
                      
                      Certification
      of Robert E. Swanson, Chief Executive Officer, pursuant to Securities
      Exchange Act Rule 13a-14(a).31.2
                      
                      Certification
      of Kathleen P. McSherry, Chief Financial Officer, pursuant to Securities
      Exchange Act Rule 13a-14(a).32
                      
                      Certifications
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
      The Sarbanes-Oxley Act of 2002, signed by Robert E. Swanson, Chief
      Executive Officer of the Company and Kathleen P. McSherry, Chief Financial
      Officer of the
Company.


19
 Table of Contents




SIGNATURES





Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
caused this Form 10-Q to be signed on its behalf by the undersigned, thereunto
duly authorized.





Dated:
                  November
      4, 2008
                  
                  
                  
                  RIDGEWOOD
      ENERGY M FUND, LLCBy:
                  /s/
                  
                  ROBERT
      E. SWANSONName:
                  
                  Robert
      E. SwansonTitle:
                  
                  President
      and Chief Executive Officer(Principal
      Executive Officer)Dated:
                  November
      4, 2008By:
                  /s/
                  
                  KATHLEEN
      P. MCSHERRYName:
                  
                  Kathleen
      P. McSherryTitle:
                  
                  Executive
      Vice President and Chief Financial Officer(Principal
      Financial and Accounting
Officer)















20