**UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM 10-KSB/A**


**(Amendment
        No. 1)**




x
              **ANNUAL
                  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                  ACT****OF
                  1934**





**For
      the fiscal year ended December 31, 2007**





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





**Commission
      File Number 0-22723**





**AMERICAN
      PETRO-HUNTER, INC.**


(Name
      of
      small business issuer as specified in its charter)





**Nevada**
            
            **98-0171619**(State
                or Other Jurisdiction of
            
            (I.R.S.
                EmployerIncorporation
                or Organization)
            
            Identification
                Number)**225
                  Marine Drive, Suite 210**
              **Blaine,
                Washington, USA**
            
            **98230**(Address
                of Principal Executive Offices)
            
            (Zip
                Code)





**(360)
      332-0905**


(Issuer’s
      telephone number)





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


None.





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





COMMON
      STOCK, PAR VALUE $0.001


(Title
      of
      Class)





Indicate
        by checkmark whether the Issuer (1) filed all reports required to be filed
        by
        Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
        such
        shorter period that the issuer was required to file such reports), and (2)
        has
        been subject to such filing requirements for the past 90 days. Yes x No o





Indicate
        by checkmark if there is no disclosure of delinquent filers in response to
        Item
        405 of Regulation S-B contained in this form, and no disclosure will be
        contained, to the best of registrant’s knowledge, in definitive proxy or
        information statements incorporated by reference in Part III of this Form
        10-KSB
        or any amendment to this Form 10-KSB. x





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





Net
      revenues for the most recent fiscal year ending December 31, 2007 were
      $0.





The
      aggregate market value of voting stock held by non-affiliates of the registrant
      was $661,202 as of April 14, 2008, 2008 **** (computed by reference to the average bid and ask price of a share of the
      registrant’s common stock on that date as reported by the Over the Counter
      Bulletin Board). For purposes of this computation, it has been assumed that
      the
      shares beneficially held by directors and officers of registrant were “held by
      affiliates”; this assumption is not to be deemed to be an admission by such
      persons that they are affiliates of registrant.





Number
      of
      shares of issuer’s common stock outstanding as of **April 14, 2008** : **8,265,019**





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





**Explanatory
        Note**





We
        are
        filing this Form 10-KSB/A to reflect corrections in the 10-KSB Original Filing
        filed with the Securities and Exchange Commission on April 15, 2008 in response
        to a comment letter received from the Commission on September 8, 2008. We
        are
        making revisions to the following sections: “Front Cover Page,” “Description of
        Business,” “Controls and Procedures,” “Financial Statements,” “Exhibit 31.1” and
“Exhibit 31.2.”








**TABLE
      OF CONTENTS**




**Page****PART
                  I**
              
              1ITEM
                  1 — DESCRIPTION OF BUSINESS
              
              7ITEM
                  2 — DESCRIPTION OF PROPERTY
              
              7ITEM
                  3 — LEGAL PROCEEDINGS
              
              7ITEM
                  4 — SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**PART
                  II**ITEM
                  5 — MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
                  MATTERS
              
              7ITEM
                  6 — MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF
                  OPERATION
              
              8ITEM
                  7 — FINANCIAL STATEMENTS
              
              11ITEM
                  8 — CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
                  FINANCIAL DISCLOSURE
              
              11ITEM
                  8A — CONTROLS AND PROCEDURES
              
              11ITEM
                  8B — OTHER INFORMATION
              
              12**PART
                  III**ITEM
                  9 — DIRECTORS AND EXECUTIVE OFFICERS
              
              12ITEM
                  10 — EXECUTIVE COMPENSATION
              
              13ITEM
                  11 — SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
                  AND
                  RELATED STOCKHOLDER MATTERS
              
              14ITEM
                  12 — CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
              
              15ITEM
                  13 — EXHIBITS
              
              16ITEM
                  14 — PRINCIPAL ACCOUNTANT FEES AND SERVICES
              
              17SIGNATURES
              
              18INDEX
                  TO EXHIBITS
              
              F-1EXHIBIT
                  10.10EXHIBIT
                  23.1EXHIBIT
                  31.1EXHIBIT
                  31.2EXHIBIT
                  32


i





**PART
      I**




**ITEM
      1**  **—
      DESCRIPTION OF BUSINESS**





**Background**




American
      Petro-Hunter Inc. (the “Company,” “we,” “us,” “our”) was formed on January 24,
      1996 pursuant to the laws of the State of Nevada under the name Wolf
      Exploration, Inc. with a business plan to acquire properties for precious metal
      exploration in the western United States. However, after considering several
      properties, we determined the properties identified were not suitable to fully
      implement an exploration and development project in the United States. In August
      1996, we changed our management team and developed a new business plan to sell
      chemical products to the oil and gas industry.





In
      October 1996, we entered into an agreement to acquire two numbered companies
      that were combined with 714674 Alberta Ltd. continuing in operation.  The
      business operated as Calgary Chemical, selling chemical products to the oil
      and
      gas industry.





In
      March
      1997, we changed our name to Wolf Industries Inc. to reflect these
      developments.





Effective
      June 30, 1998, we sold our subsidiary, 714674 Alberta Ltd. ("Calgary Chemical")
      to Gorda Technology Holdings Limited, a Turks and Caicos Islands corporation
      ("Gorda").  The terms of the sale were as follows:





(a)
      forgiveness of the inter-company debt owed by Calgary Chemical to us in the
      amount of $82,289 (Canadian);





(b)
      payment by Gorda to us of fifteen percent of Calgary Chemical's after-tax profit
      (as determined by generally accepted accounting principles) for the fiscal
      year
      ended December 31, 1998 payable on or before March 31, 1999 and completion
      of an
      audit of the financial statements of Calgary Chemical for such
      period;





(c)
      indemnification by Gorda to hold us harmless from any and all liability arising
      from the debt guarantees of Calgary Chemical;





(d)
      agreement by Gorda to hire Mr. Blair Coady as the President and Chief Executive
      Officer of Calgary Chemical; and





(e)
      receipt from Mr. Coady of his resignation as our President and Chief Executive
      Officer, Secretary, and Director and the surrender of Mr. Coady's options to
      acquire 700,000 shares of our common stock.





The
      sale
      of Calgary Chemical was subject to approval of our shareholders, which was
      received at our annual general meeting of July 24, 1998.





On
      April
      8, 1998, we entered into a license agreement with Andrew Engineering Inc.
      ("Andrew") a British Columbia corporation, Andrew Rawicz Ph.D., and Ivan Melnyk,
      Ph.D., whereby we acquired a world-wide license to manufacture and market a
      patent pending device for the color matching of dentures to a dental patient's
      existing tooth color.  Drs. Rawicz and Melnyk hold the patent pending for
      the color analyzer and Andrew developed and/or acquired the techniques and
      other
      proprietary information related to the device.   The license agreement
      required us and Andrew to develop a business plan for manufacturing and
      marketing the device, including obtaining financing of $1,500,000 US.  The
      license agreement required the issuance of 4,800,000 shares of restricted stock
      to Andrew with registration rights on 600,000 of those shares, and also required
      that Mr. Patrick McGowan to be appointed President and Chief Executive Officer.
       Mr. McGowan signed a management agreement with us, and at a meeting of our
      Board of Directors held on April 16, 1998, Mr. McGowan and Mr. A. Schwabe were
      appointed to our Board of Directors. They were also appointed interim President
      and CEO, and Secretary, Treasurer respectively, pending the approval of the
      shareholders of the Gorda transaction wherein Mr. Coady would resign from all
      positions.  The license agreement also obligated us to pay a royalty to
      Andrew in the amount of ten percent (10%) of gross profit on sales if we
      manufactured the product itself or a royalty of seven percent (7%) of gross
      revenues if manufacturing was done by an independent third
      party.


1





In
      September 1998, 4,800,000 shares of our common stock were issued to Andrew
      in
      accordance with the terms of the license agreement. As a result of settlement
      of
      the litigation with AEI Trucolor Inc. ("Trucolor"), the license agreement was
      cancelled and the 4,800,000 shares were returned to our treasury in 1999. This
      action was settled by the execution of two agreements, the effect of which
      was
      that we acquired a 40% interest in Trucolor, an arm's length company. As a
      result of the agreement, Trucolor became the owner of the rights to the device.
      During 2006, Trucolor was dissolved.





Pursuant
      to an agreement dated June 14, 2000, we purchased a 100% interest in a private
      company owned by our former director called Travelport Media Inc. ("TPI").
       TPI was a Nevada private internet e-commerce technology and content
      development company specializing in the travel and hospitality industry. The
      agreement required us to issue 3,000,000 share purchase warrants in exchange
      for
      a 100% interest in TPI.  The share purchase warrants allowed the holder to
      purchase 3,000,000 shares of our common stock for $0.27 per share.   Before
      the end of December 31, 2000, our relationship with the consultant and former
      shareholder of TPI became strained, resulting in the consultant resigning as
      our
      director on September 11, 2000.





In
      November, 2000, we received shareholder and regulatory approval to change our
      name to "Travelport Systems Inc." in anticipation of our new strategic
      direction.





Subsequent
      to December 31, 2000, we entered into a settlement agreement whereby we would
      give our interest in the shares of TPI back to the original owner on the
      condition that the original owner and our former director would assume a
      liability of $86,000 which we incurred.  In addition, subsequent to
      December 31, 2000 we cancelled 150,000 share purchase options exercisable at
      $0.15 per share until October 11, 2005, and we cancelled 200,000 share purchase
      options exercisable at $0.25 per share until October 19, 2005 issued to
      employees of TPI. After settling that action, in August 2001, we changed our
      name to “American Petro-Hunter Inc.” and our focus to the exploration and
      eventual exploitation of oil and gas.





**Our
      Business**





During
      1998, we sold Calgary Chemical and acquired the worldwide manufacturing and
      marketing rights to a dental color analyzer (the “Product").  This
      technology was developed to assist the dental industry in determining the shades
      and colors of dental materials used in replacement and/or restorative work,
      by
      precisely matching these shades to the original teeth of patients. The dental
      color analyzer discriminates between the minutest differences in tooth shading
      and determines the best shade match for partial or total restorative material.
       It does so by taking into account the differences in color of spectrally
      unmatched materials when illuminated with different light sources such as
      sunlight, incandescent lamps, and fluorescent lamps. Since acquiring the rights
      in April 1998, our efforts have been directed towards research, development
      and
      business plans for manufacturing and marketing the product. This has involved
      manufacturing a small quantity of the product for testing and demonstration
      purposes; engaging technical experts and firms to evaluate the product;
      attendance at dental conventions and shows to demonstrate the product;
      attendance at various dental firms and laboratories to demonstrate and evaluate
      the product; and work on both the product and related software to perfect its
      operation. We have also engaged the assistance of consultants to develop
      marketing plans for the product.  This has resulted in us incurring
      substantial research and development expenditures in 1998.





We
      have
      also held discussions with companies involved in the distribution of dental
      products in Canada, the United States and Europe regarding marketing of the
      product.





We
      developed preliminary business plans to proceed with manufacture and sale of
      the
      units, but were delayed in proceeding pending completion of this research and
      development, and by the action brought against us by AEI Trucolor





As
      a
      result of settlement of the Trucolor action, Trucolor became the owner of the
      dental color analyzer.  The manufacturing/distribution agreement was not
      consummated with a third party, as anticipated by the settlement agreement,
      and
      as a result we own a 40% interest in Trucolor, and GPT owns a 60% interest.
      During 2006, Trucolor was dissolved.


2





**Our
      Strategy**





Our
      focus
      is currently in locating and assessing potential acquisition targets, including
      real property, oil and gas rights and oil and gas companies. We will focus
      primarily on oil and gas properties within the U.S. and Canada including
      exploration, secondary recovery and development projects. Each project will
      be
      evaluated by our management based on sound geology, acceptable risk levels
      and
      total capital requirements to develop. Our officers and directors expect to
      travel to different locations throughout North America to evaluate potential
      acquisitions. Further, our management will participate in a variety of different
      conferences throughout 2008 to increase our exposure to potential
      opportunities.





Our
      ability to execute our strategy as outlined above is dependent on several
      factors including but not limited to: (i) identifying potential acquisitions
      of
      either assets or operational companies with prices, terms and conditions
      acceptable to us; (ii) additional financing for capital expenditures,
      acquisitions and working capital either in the form of equity or debt with
      terms
      and conditions that would be acceptable to us; (iii) our success in developing
      revenue, profitability and cash flow; (iv) the development of successful
      strategic alliances or partnerships; and (v) the extent and associated efforts
      and costs of federal, state and local regulations in each of the industries
      in
      which we currently or plan to operate in. There are no assurances that we will
      be successful in implementing our strategy as any negative result of one of
      the
      factors alone or in combination could have a material adverse effect on our
      business.





**Customers**





As
      of
      December 31, 2007, we had no customers.





**Dividends**





We
      have
      not, and currently do not intend to, pay dividends. Any change in this current
      intention is in the discretion of the Board of Directors.





**Employees**





As
      of
      December 31, 2007, we had no full time employees. We currently utilize temporary
      contract labor throughout the year to address business and administrative
      needs.





**Factors,
      Risks and Uncertainties That May Affect our Business**





*With
      the exception of historical facts stated herein, the matters*  *discussed
      in this report on Form 10-KSB are “forward looking” statements
      that*  *involve risks and uncertainties that could cause actual results to
      differ*  *materially from projected results. Such “forward looking” statements
      include,*  *but
      are not necessarily limited to statements regarding anticipated levels
      of*  *future revenues and earnings from the operations of American
      Petro-Hunter,*  *Inc.
      and its subsidiaries, (the “Company,” “we,” “us” or “our”), projected costs and
      expenses related to our operations, liquidity,*  *capital resources, and availability of future equity capital on
      commercially*  *reasonable terms. Factors that could cause actual results to differ
      materially*  *are
      discussed below. We disclaim any intent or obligation to publicly
      update*  *these “forward looking” statements, whether as a result of new
      information,*  *future events or otherwise.*





**Risks
      Relating to Our Business**





**We
      have a history of losses which may continue, which may negatively impact our
      ability to achieve our business objectives.**





We
      incurred net losses of $3,585,517 for the period from January 24, 1996
      (inception) to December 31, 2007, and $156,585 for the year ended December
      31,
      2007. We cannot be assured that we can achieve or sustain profitability on
      a
      quarterly or annual basis in the future. Our operations are subject to the
      risks
      and competition inherent in the establishment of a business enterprise. There
      can be no assurance that future operations will be profitable. We may not
      achieve our business objectives and the failure to achieve such goals would
      have
      an adverse impact on us.


3





**If
      we are unable to obtain additional funding our business operations will be
      harmed and if we do obtain additional financing our then existing shareholders
      may suffer substantial dilution** ***.***





We
      will
      require additional funds to initiate our oil and gas exploration activities,
      and
      to take advantage of any available business opportunities. Historically, we
      have
      financed our expenditures primarily with proceeds from the sale of debt and
      equity securities, and bridge loans from our officers and stockholders. In
      order
      to meet our obligations or acquire an operating business, we will have to raise
      additional funds. Obtaining additional financing will be subject to market
      conditions, industry trends, investor sentiment and investor acceptance of
      our
      business plan and management. These factors may make the timing, amount, terms
      and conditions of additional financing unattractive or unavailable to us. If
      we
      are not successful in achieving financing in the amount necessary to further
      our
      operations, implementation of our business plan may fail or be
      delayed.





**Our
      independent auditors have expressed substantial doubt about our ability to
      continue as a going concern, which may hinder our ability to obtain future
      financing** ***.***





In
      their
      report dated April 3, 2008, our independent auditors stated that our financial
      statements for the fiscal year ended December 31, 2007 were prepared assuming
      that we would continue as a going concern. Our ability to continue as a going
      concern is an issue raised as a result of recurring losses from operations.
      We
      continue to experience net operating losses. Our ability to continue as a going
      concern is subject to our ability to obtain necessary funding from outside
      sources, including obtaining additional funding from the sale of our securities.
      Our continued net operating losses increase the difficulty in meeting such
      goals
      and there can be no assurances that such methods will prove
      successful.





**We
      have a limited operating history and if we are not successful in growing our
      business, then we may have to scale back or even cease our ongoing business
      operations** ***.***





We
      have
      yet to generate positive earnings from our current business strategy and there
      can be no assurance that we will ever operate profitably. Our company has a
      limited operating history in the business of oil and gas exploration and must
      be
      considered in the development stage. Our success is significantly dependent
      on a
      successful reorganization or acquisition of an existing business. Our operations
      will be subject to all the risks inherent in the establishment of a developing
      enterprise and the uncertainties arising from the absence of a significant
      operating history. We may be unable to locate recoverable reserves or operate
      on
      a profitable basis. We are in the development stage and potential investors
      should be aware of the difficulties normally encountered by enterprises in
      the
      development stage. If our business plan is not successful, and we are not able
      to operate profitably, investors may lose some or all of their investment in
      our
      company.





**Our
      compliance with the Sarbanes-Oxley Act and SEC rules concerning internal
      controls may be time-consuming, difficult and costly for
      us.**





It
        may be
        time consuming, difficult and costly for us to maintain, improve and implement
        our internal controls and reporting procedures policy as required by the
        Sarbanes-Oxley Act. We may need to hire additional financial reporting, internal
        controls and other finance staff in order to further develop and implement
        appropriate internal controls and reporting procedures as we grow our business.
        If we are unable to comply with the internal controls requirements of the
        Sarbanes-Oxley Act, we may not be able to obtain the independent accountant
        certifications that the Sarbanes-Oxley Act requires publicly-traded companies
        to
        obtain, and this would impact our ability to comply with SEC regulations
        governing public companies.





**Risks
      Related to our Oil and Gas Exploration**





**If
      we are unable to successfully recruit qualified managerial and field personnel
      having experience in oil and gas exploration, we may not be able to execute
      on
      our business plan.**





In
      order
      to successfully implement and manage our business plan, we will be dependent
      upon, among other things, successfully recruiting qualified managerial and
      field
      personnel having experience in the oil and gas exploration business. Competition
      for qualified individuals is intense. There can be no assurance that we will
      be
      able to find, attract and retain existing employees or that we will be able
      to
      find, attract and retain qualified personnel on acceptable terms.





**We
      may not be insured against all of the operating risks to which our business
      is
      exposed.**





Our
      business is subject to all of the operating risks normally associated with
      the
      exploration for and production of oil and gas, any of which could result in
      damage to, or destruction of, property and injury to persons. As protection
      against financial loss resulting from these types of operating hazards, we
      maintain insurance coverage. However, because we are in the exploratory stage
      and have not identified for reorganization, an operating business, we are not
      fully insured against all these risks. The occurrence of a significant event
      against which we are not fully insured could have a material adverse effect
      on
      our financial position.


4





**Even
      if we are able to, the potential profitability of oil and gas ventures depends
      upon factors beyond the control of our company.**





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





**Competition
      in the oil and gas industry is highly competitive and there is no assurance
      that
      we will be successful in acquiring the leases.**





The
      oil
      and gas industry is intensely competitive. We compete with numerous individuals
      and companies, including many major oil and gas companies which have
      substantially greater technical, financial and operational resources and staffs.
      Accordingly, there is a high degree of competition for desirable oil and gas
      leases, suitable properties for drilling operations and necessary drilling
      equipment, as well as for access to funds. We cannot predict if the necessary
      funds can be raised or that any projected work will be completed.





**The
      marketability of natural resources will be affected by numerous factors beyond
      our control which may result in us not receiving an adequate return on invested
      capital to be profitable or viable** ***.***





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





**Oil
      and gas operations are subject to comprehensive regulation which may cause
      substantial delays or require capital outlays in excess of those anticipated
      causing an adverse effect on our company** ***.***





Oil
      and
      gas operations are subject to country-specific federal, state, and local laws
      relating to the protection of the environment, including laws regulating removal
      of natural resources from the ground and the discharge of materials into the
      environment. Oil and gas operations are also subject to country-specific
      federal, state, and local laws and regulations which seek to maintain health
      and
      safety standards by regulating the design and use of drilling methods and
      equipment. Various permits from government bodies are required for drilling
      operations to be conducted; no assurance can be given that such permits will
      be
      received. Environmental standards imposed by federal, state, provincial, or
      local authorities may be changed and any such changes may have material adverse
      effects on our activities. Moreover, compliance with such laws may cause
      substantial delays or require capital outlays in excess of those anticipated,
      thus causing an adverse effect on us. Additionally, we may be subject to
      liability for pollution or other environmental damages. To date, we have not
      been required to spend any material amount on compliance with environmental
      regulations. However, we may be required to do so in the future and this may
      affect our ability to expand or maintain our operations.





**Exploration
      and production activities are subject to certain environmental regulations
      which
      may prevent or delay the commencement or continuation of our
      operations.**





In
      general, our exploration and production activities are subject to certain
      country-specific federal, state and local laws and regulations relating to
      environmental quality and pollution control. Such laws and regulations increase
      the costs of these activities and may prevent or delay the commencement or
      continuation of a given operation. Compliance with these laws and regulations
      has not had a material effect on our operations or financial condition to date.
      Specifically, we are subject to legislation regarding emissions into the
      environment, water discharges and storage and disposition of hazardous wastes.
      In addition, legislation has been enacted which requires well and facility
      sites
      to be abandoned and reclaimed to the satisfaction of U.S. state authorities.
      However, such laws and regulations are frequently changed and we are unable
      to
      predict the ultimate cost of compliance. Generally, environmental requirements
      do not appear to affect us any differently or to any greater or lesser extent
      than other companies in the industry. We believe that our operations comply,
      in
      all material respects, with all applicable environmental regulations. Our
      operating partners maintain insurance coverage customary to the industry;
      however, we are not fully insured against all possible environmental
      risks.


5





**Exploratory
      drilling involves many risks and we may become liable for pollution or other
      liabilities which may have an adverse effect on our financial
      position** ***.***





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





**Risk
      Related to Seeking Other Business Opportunities**





**Exploring
      and entering into business opportunities could be very time consuming and costly
      and could adversely affect our financial condition.**





We
      have
      not identified and have no commitments to enter into or acquire a specific
      business opportunity such as a merger, joint venture or acquisition of a private
      or public entity. There can be no assurance we will be successful in identifying
      and evaluating suitable business opportunities or in concluding a business
      combination. However, if we entered into a potential business opportunity our
      participation in a business opportunity may be highly illiquid and could result
      in a total loss to us and our stockholders if the business or opportunity proved
      to be unsuccessful. Due to the special risks inherent in the investigation,
      acquisition,





**Even
      if we were to enter into a business opportunity there is no assurance of success
      or profitability.**





There
      is
      no assurance that we will acquire a favorable business opportunity. Moreover,
      even if we become involved in a business opportunity because of the unforeseen
      costs, expenses, and difficulties involved with a new business opportunity,
      there is no assurance that it will generate revenues or profits, or that the
      market price of our common stock will increase.





**SEC
      reporting requirements may be too costly for us to take advantage of any
      potential business opportunities.**





The
      Securities Exchange Act of 1934 (the "Exchange Act"), require companies to
      provide certain information about significant acquisitions, including certified
      financial statements for the company acquired, covering one, two or three years,
      depending on the relative size of the acquisition. The time and additional
      costs
      that may be incurred by some prospective entities to prepare such statements
      may
      preclude consummation of an otherwise desirable acquisition by us. Acquisition
      prospects that do not have or are unable to obtain the required audited
      financial statements may not be appropriate for acquisition.





**Risk
      Relating To Our Common Stock**





**A
      limited public trading market exists for our common stock, which makes it more
      difficult for our stockholders to sell their common stock in the
      public.**





Although
      our common stock is quoted on the OTCBB under the symbol “AAPH,” there is a
      limited public market for our common stock. No assurance can be given that
      an
      active market will develop or that a stockholder will ever be able to liquidate
      its shares of common stock without considerable delay, if at all. Many brokerage
      firms may not be willing to effect transactions in the securities. Even if
      a
      purchaser finds a broker willing to effect a transaction in these securities,
      the combination of brokerage commissions, state transfer taxes, if any, and
      any
      other selling costs may exceed the selling price


6





**Our
      common stock may be subject to the penny stock rules which may make it more
      difficult to sell our common stock** *.*





The
      Securities and Exchange Commission has adopted regulations which generally
      define a “penny stock” to be any equity security that has a market price, as
      defined, less than $5.00 per share or an exercise price of less than $5.00
      per
      share, subject to certain exceptions. Our securities may be covered by the
      penny
      stock rules, which impose additional sales practice requirements on
      broker-dealers who sell to persons other than established customers and
      accredited investors such as, institutions with assets in excess of $5,000,000
      or an individual with net worth in excess of $1,000,000 or annual income
      exceeding $200,000 or $300,000 jointly with his or her spouse. For transactions
      covered by this rule, the broker-dealers must make a special suitability
      determination for the purchase and receive the purchaser’s written agreement of
      the transaction prior to the sale. Consequently, the rule may affect the ability
      of broker-dealers to sell our securities and also affect the ability of our
      stockholders to sell their shares in the secondary market.





**Our
      management and stockholders may lose control of the Company as a result of
      a
      merger or acquisition.**





We
      may
      consider an acquisition in which we would issue as consideration for the
      business opportunity to be acquired an amount of our authorized but unissued
      common stock that would, upon issuance, represent the great majority of the
      voting power and equity of the Company. As a result, the acquiring company's
      stockholders and management would control the Company, and our current
      management may be replaced by persons unknown at this time. Such a merger would
      result in a greatly reduced percentage of ownership of the Company by its
      current stockholders.





**We
      have historically not paid dividends and do not intend to pay
      dividends.**





We
      have
      historically not paid dividends to our stockholders and management does not
      anticipate paying any cash dividends on our common stock to our stockholders
      for
      the foreseeable future. We intend to retain future earnings, if any, for use
      in
      the operation and expansion of our business




**ITEM
      2**  **—
      DESCRIPTION OF PROPERTY**





Effective
      December 2007 we moved our offices to 225 Marine Drive, Suite 210, Blaine,
      Washington, under a consulting agreement with our President. We do not pay
      rent
      for the use of its office but may be responsible for certain telephone charges
      and miscellaneous office expenses. We share this office space with other
      companies, and occupy approximately 750 square feet.




**ITEM
      3**  **—
      LEGAL PROCEEDINGS**





None.




**ITEM
      4**  **—
      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**





None.




**PART
      II**




**ITEM
      5**  **—
      MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS**





**Market
      Information**





Our
      common stock is traded on the Over the Counter Bulletin Board under the symbol
      AAPH.





The
      following is the range of high and low bid prices for our common stock for
      the
      periods indicated. The quotations reflect inter-dealer prices, without retail
      mark-up, mark-down or commissions and may not represent actual
      transactions.




**Fiscal 2007**
            
            **High**
            
            **Low**First
                Quarter (March 31, 2007)
            
            $
            .25
            
            $
            .14Second
                Quarter (June 30, 2007)
            
            $
            .14
            
            $
            .125Third
                Quarter (September 30, 2007)
            
            $
            .128
            
            $
            .125Fourth
                Quarter (December 31, 2007)
            
            $
            .15
            
            $
            .08




7





**Fiscal 2006**
            
            **High**
            
            **Low**First
                Quarter (March 31, 2006)
            
            $
            .20
            
            $
            .12Second
                Quarter (June 30, 2006)
            
            $
            .20
            
            $
            .12Third
                Quarter (September 30, 2006)
            
            $
            .29
            
            $
            .12Fourth
                Quarter (December 31, 2006)
            
            $
            .24
            
            $
            .13





The
      closing price for our common stock on December 31, 2007 was $0.09.





**Stockholders**





As
      of
      December 31, 2007, there were 8,265,019 shares of common stock issued and
      outstanding held by 67 stockholders of record (not including street name
      holders).





**Dividends**





We
      have
      not paid dividends to date and do not anticipate paying any dividends in the
      foreseeable future. Our Board of Directors intends to follow a policy of
      retaining earnings, if any, to finance our growth. The declaration and payment
      of dividends in the future will be determined by our Board of Directors in
      light
      of conditions then existing, including our earnings, financial condition,
      capital requirements and other factors.





**Equity
      Compensation Plan Information**





In
      November 1996, by resolution of our board of directors, we adopted the Wolf
      Exploration Inc. 1996 Directors and Officers Stock Option Plan ("the Plan"),
      for
      our officers and directors, whereby 1,000,000 shares of our common stock was
      reserved for issuance.  The plan permitted us to grant nonqualified stock
      options within five years of the date of establishing the Plan. By
      resolution of our directors dated May 28, 1998, we reserved an additional one
      million shares of common stock for the Plan bringing the total shares reserved
      to 2,000,000 and renamed the Plan "The Wolf Industries Inc. 1998 Directors
      and
      Officers Stock Option Plan” (the “Revised Plan”) with all other terms and
      conditions of the Plan remaining in full force and effect.





In
      September 1998, by resolution of our board of directors, we established the
      "1998 Key Personnel Compensation Plan"  ("Key Plan"), for our key
      personnel, whereby 1,000,000 shares of our common stock was reserved for
      issuance. The Key Plan permitted us to grant nonqualified stock options within
      five years of the date of establishing the Plan. By resolution of our
      directors dated November, 1998, a further 1,000,000 shares of common stock
      was
      authorized to be reserved for issuance, bringing the total issuable under the
      Key Plan to 2,000,000 shares of common stock.





In
      October, 2000, by resolution of our board of directors, we established the
      2000
      Stock Option Plan ("2000 Plan"), for our officers, directors, employees,
      consultants and advisors, whereby 5,000,000 of our common stock was reserved
      for
      issuance. The 2000 Plan permitted us to grant nonqualified stock options within
      five years of the date of establishing the Plan.




In
      September, 2001, by resolution of our board of directors, we established the
      2001 Stock Option Plan ("2001 Plan"), for our officers, directors, employees,
      consultants and advisors, whereby 1,500,000 of our common stock was reserved
      for
      issuance. The 2001 Plan permitted us to grant incentive and nonqualified stock
      options, restricted stock, stock bonuses, stock appreciation rights, reload
      options. Options under the 2001 Plan are exercisable subject to continued
      employment and other conditions.





There
      are
      no options currently outstanding under any of the aforementioned
      plans.




**ITEM
      6**  **—
      MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**





The
      following discussion should be read in conjunction with our consolidated
      financial statements and notes thereto included elsewhere in this Report.
      Forward looking statements are statements not based on historical information
      and which relate to future operations, strategies, financial results or other
      developments. Forward-looking statements are based upon estimates, forecasts,
      and assumptions that are inherently subject to significant business, economic
      and competitive uncertainties and contingencies, many of which are beyond our
      control and many of which, with respect to future business decisions, are
      subject to change. These uncertainties and contingencies can affect actual
      results and could cause actual results to differ materially from those expressed
      in any forward-looking statements made by us, or on our behalf. We disclaim
      any
      obligation to update forward-looking statements.


8





The
      discussion and financial statements contained herein are for our fiscal year
      ended December 31, 2007 and December 31, 2006. The following discussion
      regarding our financial statements should be read in conjunction with our
      financial statements included herewith. Revenue and expense transactions in
      Canadian dollars are converted to U.S. dollars at the average rates in effect
      when the transactions occurred. Asset and liability accounts are converted
      at
      year-end closing rates, which were US$1.0194 for one Canadian dollar at December
      31, 2007 and US$0.8619 at December 31, 2006.





**Financial
      Condition as of December 31, 2007**





We
      reported total current assets of $8,691 at December 31, 2007 consisting of
      cash
      of $6,207, and taxes recoverable totaling $2,484. Total current liabilities
      reported of $489,815 consisted of accounts payables of $255,695, amounts payable
      to related parties of $105,896, note payable of $25,000, and a loan guarantee
      of
      $103,224. The Company had a working capital deficit of $481,124 at December
      31,
      2007.





Stockholders'
      Deficiency increased from $384,539 at December 31, 2006 to $481,124 at December
      31, 2007. This increase is due to net losses of approximately $107,554 and
      other
      comprehensive losses of approximately $49,031. Additionally, we received $60,000
      in advance for shares of our common stock to be issued.





We
      are
      currently a development stage company focused on the oil and gas industry,
      and
      evaluating opportunities for expansion within that industry through acquisition
      or other strategic relationships.





**Plan
      of Operation**





**Background**





We
      were
      formed on January 24, 1996 pursuant to the laws of the State of Nevada under
      the
      name Wolf Exploration, Inc. with a business plan to acquire properties for
      precious metal exploration in the western United States. However, after
      considering several properties, we determined the properties identified were
      not
      suitable to fully implement an exploration and development project in the United
      States. In August 1996, we changed our management team and developed a new
      business plan to sell chemical products to the oil and gas industry. In 1998,
      we
      sold that business and developed a new business plan for the manufacturing
      and
      marketing of a dental color analyzer. Our plans to manufacture and sell the
      analyzer were delayed pending completion of research and development and by
      an
      action brought against us by AEI Trucolor. After settling that action, in August
      2001, we changed our name to “American Petro-Hunter Inc.” and our focus to the
      exploration and eventual exploitation of oil and gas.





We
      have
      had no revenues since 2004. The accompanying financial statements have been
      prepared assuming that we will continue as a going concern. Having no sources
      of
      income, substantial doubt is raised about our ability to continue as a going
      concern.





Our
      plan
      of operations for the next fiscal year is to seek out a privately held business
      with whom we can reorganize so as to take advantage of our status as a publicly
      held corporation.  As of the date of this report, our management has
      evaluated several potential reorganizations but deemed them unsuitable.
 However as of the date of this report, there has been no decision to
      proceed on any reorganization nor has any agreement been reached on even
      principal terms of such reorganization. We also intend to investigate the
      acquisition and development of natural resource projects without necessarily
      reorganizing with another party.




**Cash
      and Cash Equivalents**





As
      of
      December 31, 2007, we had cash of $6,207 and did not have any cash equivalents.
      We anticipate that a substantial portion shall be used as working capital and
      to
      execute our reorganization strategy and business plan. As such, we further
      anticipate that we will have to raise additional capital through debt or equity
      financings to fund our operations during the next 6 to 12
      months.


9





**Results
      of Operations**





**For
      the Fiscal Year Ended December 31, 2007**





For
      the
      fiscal year ended December 31, 2007, we incurred a net loss of
      $107,554.





Administration
      expenses for the fiscal year end amounted to $92,554 compared to $61,523 in
      2006. Executive compensation for the fiscal year end is $15,000 compared to
      $10,000 in 2006.





**For
      the Fiscal Year Ended December 31, 2006**





For
      the
      fiscal year ended December 31, 2006, we incurred a net loss of
      $72,397.





Administration
      expenses for the fiscal year end amounted to $61,523 compared to $42,329 in
      2005. Executive compensation for the fiscal year end is $10,000 compared to
      $26,268 in 2005.





**Period
      from inception, January 24, 1996 to December 31, 2007**





We
      have
      incurred losses in each period since inception and have an accumulated deficit,
      consisting of deficit and accumulated comprehensive losses, of $3,585,517 at
      December 31, 2007. We expect to continue to incur losses as a result of
      expenditures for general and administrative activities while we remain in the
      development stage.





**Liquidity
      and Capital Resources**





We
      are
      experiencing illiquidity and has been dependent upon shareholders and directors
      to provide funds to maintain its activities. At fiscal year ended December
      31,
      2007, the balance of amounts owing to related parties amounted to $105,896.
      There are no specific terms of repayment for amounts owing to related
      parties.





We
      had a
      working capital deficiency of $481,124 at December 31, 2007.





As
      a
      development stage company, we currently have limited operations, principally
      directed at evaluating potential acquisition targets and revenue-generating
      opportunities.





Our
      management believes that we will be able to generate sufficient revenue or
      raise
      sufficient amounts of working capital through debt or equity offerings, as
      may
      be required to meet our short-term and long-term obligations. In order to
      execute on our business strategy, we will require additional working capital,
      commensurate with the operational needs of the target companies we may pursue.
      Such working capital will most likely be obtained through equity or debt
      financings until such time as acquired operations are integrated and producing
      revenue in excess of operating expenses. There are no assurances that we will
      be
      able to raise the required working capital on terms favorable, or that such
      working capital will be available on any terms when needed.





**Off-Balance
      Sheet Transactions**





There
      are
      no off balance sheet items.





**Capital
      Expenditures**





We
      did
      not make any capital expenditures in the fiscal year ending December 31,
      2007.





The
      following table outlines payments due under our significant contractual
      obligations over the periods shown, exclusive of interest:





**Payments Due by Period****Contract Obligations**
              **At December 31, 2007**
            
            **Total**
            
            **Less than**
              **1 Year**
            
            **1-3 years**
            
            **3-5 years**
            
            **More than**
              **5 years**Total
                Short Term Debt
            
            $
            25,000
            
            $
            25,000
            
            $
            
            
            $
            
            
            $
            —




10





The
      above
      table outlines our obligations as of December 31, 2007 and does not reflect
      any
      changes in our obligations that have occurred after that date.




**ITEM
      7**  **—
      FINANCIAL STATEMENTS**





The
      Financial Statements that constitute Item 7 are included at the end of this
      report beginning on Page F-1.




**ITEM
      8**  **—
      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
      AND**  **FINANCIAL DISCLOSURE**





On
      March
      27, 2008, Morgan & Company (“Morgan”) resigned as our independent
      accountant.





Morgan’s
      report on our financial statements for the fiscal years ended December 31,
      2006
      and 2005 contained a modified opinion on our uncertainty to continue as a going
      concern because of recurring losses from operations, negative cash flows,
      stockholders’ deficiency and dependence upon obtaining adequate financing to
      fulfill our exploration activities.





Our
      Board
      of Directors approved the decision to change independent accountants on March
      27, 2008.




During
      the last two fiscal years ended December 31, 2005 and 2006, and further through
      the subsequent interim periods ended March 31, 2007, June 30, 2007 and September
      30, 2007 and the date of resignation of Morgan, there have been no disagreements
      with Morgan on any matter of accounting principles or practices, financial
      statement disclosure, or auditing scope or procedure, which disagreement if
      not
      resolved to the satisfaction of Morgan, would have caused them to make reference
      to the subject matter of the disagreement(s) in connection with their report
      as
      required by Item 304(a)(1)(iv) of Regulation S-K.




During
      the last two fiscal years ended December 31, 2005 and 2006, and further through
      the subsequent interim periods ended March 31, 2007, June 30, 2007 and September
      30, 2007, Morgan did not advise us on any matter set forth in Item
      304(a)(1)(v)(A) through (D) of Regulation S-K.




On
      March
      27, 2008, we engaged Berkovits & Company, LLP (“Berkovits”) as our new
      independent accountants to audit our financial statements for the fiscal year
      ending December 31, 2007. During the last two fiscal years ended December 31,
      2005 and 2006, and further through the subsequent interim periods ended March
      31, 2007, June 30, 2007 and September 30, 2007, we did not consult with
      Berkovits regarding (i) the application of accounting principles to a specific
      transaction, either completed or proposed, or the type of audit opinion that
      might be rendered on our financial statements, and no written report or oral
      advice was provided to us by Berkovits concluding there was an important factor
      to be considered by us in reaching a decision as to an accounting, auditing
      or
      financial reporting issue; or (ii) any matter that was either the subject of
      a
      disagreement, as that term is defined in Item 304 (a)(1)(iv) of Regulation
      S-K
      or a reportable event, as that term is described in Item 304 (a)(1)(v) of
      Regulation S-K.




**ITEM
      8A**  **—
      CONTROLS AND PROCEDURES**





We
        carried out an evaluation, under the supervision and with the participation
        of
        our management, including our Principal Executive Officer along with our
        Principal Financial Officer, of the effectiveness of the design of the our
        disclosure controls and procedures (as defined by Exchange Act
        Rule 13a-15(e) and 15a-15(e)) as of the end of our fiscal year pursuant to
        Exchange Act Rule 13a-15. Based upon that evaluation, our Principal
        Executive Officer along with our Principal Financial Officer concluded that
        our
        disclosure controls and procedures are effective in ensuring that information
        required to be disclosed by us in reports that we file or submit under the
        Exchange Act is recorded, processed, summarized and reported within the time
        periods specified in the Securities and Exchange Commission’s rules and forms
        and that such information is accumulated and communicated to our management,
        including our Principal Executive Officer and Principal Financial Officer,
        as
        appropriate, to allow timely decisions regarding required
        disclosure.




**Management’s
      Report on Internal Control over Financial Reporting**





Our
      management is responsible for establishing and maintaining adequate internal
      control over financial reporting as defined in Rules 13a-15(f) and
      15d-15(f) under the Exchange Act. Under the supervision and with the
      participation of our management, including our Chief Executive Officer and
      Chief
      Financial Officer, we conducted an evaluation of the effectiveness of our
      internal control over financial reporting based on criteria established in
      the
      framework in *Internal Control – Integrated Framework* issued
      by the Committee of Sponsoring Organizations of the Treadway Commission. Based
      on this evaluation, our management concluded that our internal control over
      financial reporting was effective as of December 31, 2007.


11





Because
      of its inherent limitations, internal control over financial reporting may
      not
      prevent or detect misstatements. Projections of any evaluation of effectiveness
      to future periods are subject to the risk that controls may become inadequate
      because of changes in conditions, or that the degree of compliance with the
      policies or procedures may deteriorate. All internal control systems, no matter
      how well designed, have inherent limitations. Therefore, even those systems
      determined to be effective can provide only reasonable assurance with respect
      to
      financial statement preparation and presentation.





This
      annual report does not include an attestation report of our registered public
      accounting firm regarding internal control over financial reporting. Our
      management’s report was not subject to attestation by our registered public
      accounting firm pursuant to temporary rules of the Securities and Exchange
      Commission that permit us to provide only our management’s report in this annual
      report.





**Changes
      in Internal Control over Financial Reporting**





We
      have
      had very limited operations and there were no changes in our internal controls
      over financial reporting that occurred during the three months ended December
      31, 2007 that have materially affected, or are reasonably likely to materially
      affect, our internal controls over financial reporting. We believe that a
      control system, no matter how well designed and operated, cannot provide
      absolute assurance that the objectives of the control system are met, and no
      evaluation of controls can provide absolute assurance that all control issues
      and instances of fraud, if any, within any company have been
      detected.




**ITEM
      8B**  **—
      OTHER INFORMATION**





One
      December 1, 2007, we entered into a Management and Governance Consultant
      Agreement with Sound Energy Advisors, LLC, an affiliated entity of our President
      (the “Consultant”), whereby it was agreed that the Consultant would provide us
      with management and consulting services for a monthly fee of $2,500. The
      agreement was effective on December 1, 2007 and expires on November 30, 2009
      and
      is subject to termination upon 30-day prior written notice by either
      party.





Subsequent
      to year end, we completed an equity financing for 600,000 units at $0.05 per
      unit for total proceeds of $30,000 to foreign accredited investors. Each unit
      is
      comprised of one share of our common stock and a warrant to purchase one share
      of our common stock at a price per share of $0.15 for a period of 3 years from
      the date of issuance.  We offered and sold our securities in reliance
      on Section 506 of Regulation D and/or Regulation S of the
      Securities Act, and comparable exemptions for sales to “accredited” investors
      under state securities laws.




**PART
      III**




**ITEM
      9**  **—
      DIRECTORS AND EXECUTIVE OFFICERS**





**Directors
      and Executive Officers**





The
      following table sets forth the names and ages of our current directors and
      executive officers, the principal offices and positions held by each
      person:





**Person**
            
            **Age**
            
            **Position**Gregory
                Leigh Lyons
            
            49
            
            Chairman
                of the Board; President, Chief Financial Officer and
                Secretary





Gregory
      Leigh Lyons


Mr.
      Lyons
      was appointed as our President, Secretary and Treasurer effective December
      5,
      2007.  Prior to joining us, Mr. Lyons founded Sound Energy Advisors LLC,
      which provides corporate governance and management consulting services to
      start-up and small cap companies. In addition, Mr. Lyons spent over 23 years
      working in a variety of upper management and executive positions for small
      and
      large, publicly-traded and private, foreign and domestic companies, and in
      many
      foreign countries including Venezuela, Ecuador, Bolivia, Argentina, Colombia
      and
      Iran. From August 2005 to May 2006, Mr. Lyons was the Chief Executive Officer
      and a director of Digital Ecosytems Corp. (OTC BB: DGEO), a global oil and
      gas
      exploration company specializing in acquiring unconventional oil and gas
      prospects in North America and Australia. From 2000 to 2005, Mr. Lyons was
      Chief
      Operating Officer and Project Director for Gas TransBoliviano S.A., a
      Shell/Enron controlled gas transmission company headquartered in Bolivia. Mr.
      Lyons currently serves on the Board of Directors of Radial Energy Inc. (OTCBB:
      RENG). Mr. Lyons received his Bachelor of Arts (BA) in Earth Science from the
      University of California, Santa Cruz in 1984 and is an Alumnus of the Harvard
      Business School having completed the Advanced Management Program (AMP) in
      2004.


12





**Audit
      Committee Financial Expert**





Our
      Board
      of Directors has not established a separate audit committee within the meaning
      of Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the
      "Exchange Act"). Instead, the entire Board of Directors acts as the audit
      committee within the meaning of Section 3(a)(58)(B) of the Exchange Act. In
      addition, Gregory Leigh Lyons currently meets the definition of an "audit
      committee financial expert" within the meaning of Item 407(d)(5) of Regulation
      SB. Mr Lyons is not an independent director. We are seeking candidates for
      outside directors and for a financial expert to serve on a separate audit
      committee when we establish one. Due to our small size and limited operations
      and resources, it has been difficult to recruit outside directors and financial
      experts.





**Compliance
      with Section 16(a) of the Securities Exchange Act of 1934**





Based
      solely upon a review of Forms 3, 4 and 5 delivered to us as filed with the
      Securities Exchange Commission, our President and Director, Gregory Leigh Lyons
      failed to file on a timely basis a Form 3 as required pursuant to Section
      16(a) of the Securities Exchange Act. Mr. Lyons had one late report during
      the
      fiscal year ended December 31, 2007.




Except
      as
      set forth above, and based solely upon a review of Forms 3, 4 and 5 delivered
      to
      us as filed with the Securities Exchange Commission, our executive officers
      and
      directors, and persons who own more than 10% of our Common Stock timely filed
      all required reports pursuant to Section 16(a) of the Securities Exchange
      Act.





**Code
      of Ethics**





Given
      our
      limited operations and resources and because we are in the development stage,
      we
      have not yet adopted a code of ethics. Upon commencement of significant
      operations and hiring other executive officers, we intend to adopt a code of
      ethics that will apply to all our employees.




**ITEM
      10**  **—
      EXECUTIVE COMPENSATION**





**Summary
      Compensation**





The
      summary compensation table below shows certain compensation information for
      services rendered in all capacities to us by our principal executive officer
      and
      by each other executive officer whose total annual salary and bonus exceeded
      $100,000 during the fiscal periods ended December 31, 2007 and December 31,
      2006. Other than as set forth below, no executive officer’s total annual
      compensation exceeded $100,000 during our last fiscal period.





**Summary
      Compensation Table**





**Name and Principal Position (a)**
            
            **Year**
              **(b)**
            
            **Salary**
              **($)**
              **(c)**
            
            **Bonus**
              **($)**
              **(d)**
            
            **Stock**
              **Awards**
              **($)**
              **(e)(2)**
            
            **Option**
              **Awards**
              **($)**
              **(f)**
            
            **Non**
              **Equity**
              **Incentive**
              **Plan**
              **Compensation**
              **($)**
              **(g)**
            
            **Non-qualified**
              **Deferred**
              **Compensation**
              **Earnings**
              **($)**
              **(h)**
            
            **All Other**
              **Compensaion**
              **($)**
              **(i)**
            
            **Total**
              **($)**
              **(j)**Patrick
                McGowan,
            
            
            2007
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            
            -0-
            
            
            -0-
            
            $
            15,000
            
            $
            15,000Former
                Chairman of the Board, President, and Chief Financial
                Officer(1)
            
            
            2006
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            
            -0-
            
            
            -0-
            
            $
            10,000
            
            $
            10,000Gregory
                Leigh Lyons
            
            
            2007
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            
            -0-
            
            
            -0-
            
            $
            2,500
            
            $
            2,500Chairman
                of the Board, President, and Chief Financial OfficerMike
                Veldhuis, Director
            
            
            2007
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            
            -0-
            
            
            -0-
            
            $
            19,406
            
            $
            19,4062006
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            
            -0-
            
            
            -0-
            
            $
            8,079
            
            $
            8,079Barry
                Whelan, Director
            
            
            2007
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            
            -0-
            
            
            -0-
            
            $
            0
            
            $
            02006
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            $
            -0-
            
            
            -0-
            
            
            -0-
            
            $
            579
            
            $
            579




13





(1)
            Mr.
                McGowan, Mr. Veldhius and Mr. Whelan resigned all their positions
                with us
                on December 7, 2007.





Mr.
      Lyons
      billed a total of $2,500 for the fiscal year ended December 31, 2007 in
      accordance with a consulting agreement approved by the board of directors on
      December 21, 2007, whereby Mr. Lyons, through his affiliate, Sound Energy
      Advisors, LLC (“SEA”), agreed to provide us with management and governance
      consulting services, including of liaising with our officers and employees
      concerning matters relating to the management and corporate governance of our
      day to day operations, accounting, regulatory compliance, marketing and investor
      relations issues. In consideration of services rendered, we agreed to pay SEA
      a
      fee in the amount of $2,500 per month, together with applicable taxes and
      out-of-pocket expenses for specialized services. The agreement is for a two
      year
      term commencing December 1, 2007 and continuing until November 30, 2009 and
      is
      subject to termination upon 30 day prior written notice by either
      party.





Mr.
      McGowan billed a total of $15,000 and $10,000 in management fess for the fiscal
      years ended December 31, 2007 and 2006 respectively in accordance with a
      management agreement approved by the board of directors on April 1, 1998 at
      a
      rate of Cnd $7,000 per month, which was subsequently reduced to Cnd $5,000
      per
      month effective August 1999, and in 2002, to Cnd $2,500 retroactive to October
      1, 2001. The management agreement was further reduced to $833.33 per month
      effective January 1, 2006.





Two
      private companies owned by Mr. Veldhuis were paid a total of $19,406 and $7,500
      of consulting fees for the fiscal years ended December 31, 2007 and 2006,
      respectively.





Mr.
      Whelan was paid a total of $0 and $579 of consulting fees for the fiscal years
      ended December 31, 2007 and 2006, respectively.





**Director
      Compensation**





Our
      board
      of directors are reimbursed for actual expenses incurred in attending Board
      meetings. There are no other compensation arrangement with directors, and the
      directors did not receive any compensation in the fiscal years ending December
      31, 2007 and 2006.




**ITEM
      11**  **—
      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
      MANAGEMENT**  **AND
      RELATED STOCKHOLDER MATTERS**





The
      following table sets forth, as of April 14, 2008, the number and percentage
      of
      outstanding shares of our common stock owned by (i) each person known to us
      to
      beneficially own more than 5% of our outstanding common stock, (ii) each
      director, (iii) each named executive officer, and (iv) all executive officers
      and directors as a group. Share ownership is deemed to include all shares that
      may be acquired through the exercise or conversion of any other security
      immediately or within the next sixty days. Such shares that may be so acquired
      are also deemed outstanding for purposes of calculating the percentage of
      ownership for that individual or any group of which that individual is a member.
      Unless otherwise indicated, the stockholders listed possess sole voting and
      investment power with respect to the shares shown.


14




**Name and Address**
              **of Beneficial Owner**
            
            **Title of Class**
            
            **Amount and Nature**
              **of Beneficial**
              **Ownership of**
              **Common Stock(1)**
            
            **Percentage of**
              **Common Stock**
              **Outstanding(1)**Patrick
                A. McGowan
              211-1148
                Westwood Street
              Coquitlam,
                B.C., Canada
              V3B
                4S4
            
            
            Common
            
            
            225,438
            
            
            2.73
            %Gregory
                Leigh Lyons
              Suite
                225 - 225 Marine Drive
              Blaine,
                WA 98230
            
            
            Common
            
            
            -
            
            
            -Mike
                Veldhuis
              Suite
                2 – 2072 West 3rdAve
              Vancouver,
                B.C., Canada
              V6J
                1L5
            
            
            Common
            
            
            -
            
            
            -Barry
                L. Whelan
              1250 –
                800 West Pender Street
              Vancouver,
                B.C., Canada
              V6C
                2V6
            
            
            Common
            
            
            -
            
            
            -All
                Executive Officers and Directors as a Group (4 persons)
            
            
            Common
            
            
            225,438
            
            
            2.73
            %




(1)
            Based
                upon information furnished to us by the directors and executive officers
                or obtained from our stock transfer books showing 8,265,019 shares
                of
                common stock outstanding as of April 14, 2008. We are informed that
                these
                persons hold the sole voting and dispositive power with respect to
                the
                common stock except as noted herein. For purposes of computing “beneficial
                ownership” and the percentage of outstanding common stock held by each
                person or group of persons named above as of April 14, 2008, any
                security
                which such person or group of persons has the right to acquire within
                60
                days after such date is deemed to be outstanding for the purpose
                of
                computing beneficial ownership and the percentage ownership of such
                person
                or persons, but is not deemed to be outstanding for the purpose of
                computing the percentage ownership of any other
                person.





**ITEM
      12****—
      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS**





In
      December 2007, we entered into a Management and Governance Consultant Agreement
      with Sound Energy Advisors, LLC, an affiliated entity of our President (the
      “Consultant”), whereby it was agreed that the Consultant would provide us with
      management and consulting services for a monthly fee of $2,500. The agreement
      was effective on December 1, 2007 and expires on November 30, 2009 and is
      subject to termination upon 30-day prior written notice by either
      party.





Mr.
      McGowan billed us a total of $15,000 during 2007 and $10,000 during 2006 for
      services rendered.





Mr.
      Veldhuis, one of our directors, is an owner of Endurven Management Inc. and
      0758445 BCLTD which were paid a total of $19,406 and $8,079 of consulting fees
      for the fiscal years ended December 31, 2007 and 2006,
      respectively.





Mr.
      Whelan, one of our directors, was paid a total of $579 of consulting fees for
      the fiscal year ended December 31, 2006.


15





**ITEM
      13**  **—
      EXHIBITS**





**Exhibit Number**
            ****
            **Name**3.1(1)
            
            
            Amended
                and Restated Articles of Incorporation4.1(2)
            
            
            1998
                Directors and Officers Option Plan4.2(3)
            
            
            Amended
                1998 Key Personnel Compensation Plan4.3(4)
            
            
            2000
                Stock Option Plan4.4(5)
            
            
            2001
                Stock Option Plan10.1(6)
            
            
            Sale
                Agreement between Wolf Industries Inc. and Gorda Technology Holdings
                Limited10.2(6)
            
            
            License
                Agreement between Wolf Industries Inc. and Andrew Engineering Inc.,
                et
                al10.3(7)
            
            
            Asset
                Purchase Agreement between Wolf Industries Inc. and Andrew Engineering
                Inc.10.4(7)
            
            
            Agreement
                between Wolf Industries Inc., Andrew Engineering Inc., Andrew Rawicz
                and
                GPT Management10.5(8)
            
            
            Letter
                of Intent with Galloway Financial Services10.6(8)
            
            
            Letter
                Agreement with Dancing Star Resources10.7(8)
            
            
            Assignment
                of Lease with Exor Oil Company, LLC10.8(9)
            
            
            Loan
                Agreement with VCF Capital Corp.10.9(9)
            
            
            Form
                of Securities Purchase Agreement10.10
            
            
            Management
                and Governance Consultant Agreement16(10)
            
            
            Letter
                from Morgan and Company23.1
            
            
            Consent
                of Morgan and Company31.1
            
            
            Rule
                13(a) — 14(a)/15(d) — 14(a) Certification (Principal Executive
                Officer)31.2
            
            
            Rule
                13(a) — 14(a)/15(d) — 14(a) Certification (Principal Financial
                Officer)32
            
            
            Section
                1350 Certifications




16





**Footnotes
      to Exhibits Index**





(1)
            Incorporated
                by reference to Form 10-SB12G dated June 19,
                1997.





(2)
            Incorporated
                by reference to Form S-8 dated September 10,
                1998.





(3)
            Incorporated
                by reference to Form S-8 dated December 9,
                1998.





(4)
            Incorporated
                by reference to Form S-8 dated October 20,
                2000.





(5)
            Incorporated
                by reference to Form S-8 dated October 2,
                2001.





(6)
            Incorporated
                by reference to Form 10-QSB for the period ended March 31,
                1998.





(7)
            Incorporated
                by reference to Form 10-QSB for the period ended June 30,
                1999.





(8)
            Incorporated
                by reference to Form 10-QSB for the period ended September 30,
                2001.





(9)
            Incorporated
                by reference to Form 10-KSB for the year ended December 31,
                2006.





(10)
            Incorporated
                by reference to Form 8-K/A dated April 14,
                2008.





**ITEM
      14****—
      PRINCIPAL ACCOUNTANT FEES AND SERVICES.**





The
      following table shows the fees paid or accrued by us for the audit and other
      services provided Morgan and Company for the fiscal periods
      shown.





**December 31, 2007**
            
            **December 31, 2006**Audit
                Fees
            
            $
            22,064
            
            $
            34,840Audit
                — Related Fees
            
            
            —
            
            
            —Tax
                Fees
            
            
            —
            
            
            —All
                Other Fees
            
            
            ——
            
            
            —Total
            
            $
            22,064
            
            $
            34,840





Audit
      fees consist of fees billed for professional services rendered for the audit
      of
      our financial statements and review of the interim financial statements included
      in quarterly reports and services that are normally provided by the above
      auditors in connection with statutory and regulatory fillings or
      engagements





In
      the
      absence of a formal audit committee, the full Board of Directors pre-approves
      all audit and non-audit services to be performed by the independent registered
      public accounting firm in accordance with the rules and regulations promulgated
      under the Securities Exchange Act of 1934, as amended. The Board of Directors
      pre-approved 100% of the audit, audit-related and tax services performed by
      the
      independent registered public accounting firm in fiscal 2007. The percentage
      of
      hours expended on the principal accountant’s engagement to audit the Company’s
      financial statements for the most recent fiscal year that were attributed to
      work performed by persons other than the principal accountant’s full-time,
      permanent employees was 0%.


17





**SIGNATURES**





In
      accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934,
      as
      amended (the “Exchange Act”) the Registrant caused this report to be signed on
      its behalf by the undersigned, thereunto duly authorized.





**AMERICAN
      PETRO-HUNTER, INC.**





Dated:
                  September 19, 2008
              /s/
                  Gregory Leigh LyonsBy:
                  Gregory Leigh LyonsIts:
                  President, Chief Financial Officer and Chairman of theBoard
                  (Principal Executive Officer)Dated:
                  September 19, 2008
              /s/
                  Gregory Leigh LyonsBy:
                  Gregory Leigh LyonsIts:
                  President, Chief Financial Officer and Chairman ofthe Board (Principal Financial Officer and Principal Accounting
                Officer)





Pursuant
      to requirements of the Securities Exchange Act of 1934, this report has been
      signed below by the following persons on behalf of the registrant and in the
      capacities and on the dates indicated:





**Signature**
              
              **Capacity**
              
              **Date**/s/
                  Gregory Leigh Lyons
              
              Director
              
              September 19, 2008Gregory
                  Leigh Lyons




18





**AMERICAN
      PETRO-HUNTER INC.**


**(A
      Development Stage Company)**




**FINANCIAL
      STATEMENTS**




**DECEMBER
      31, 2007 AND 2006**


**(Stated
      in U.S. Dollars)**




**American
      Petro-Hunter Inc.**


**Index
      to Financial Statements**


**December
      31, 2007**





**INDEX**





**Page**Independent
                Registered Public Accounting Firms’ Reports
            
            F-2
                to F-3Financial
                StatementsBalance
                Sheets as of December 31, 2007 and 2006
            
            F-4Statements
                of Operations for the years ended December 31, 2007 and 2006 and
                for the
                period from January 24, 1996 (inception) to December 31,
                2007
            
            F-5Statements
                of Changes in Stockholders’ Deficit for the period from January 24, 1996
                (inception) through December 31, 2007
            
            F-6Statements
                of Cash Flows for the years ended December 31, 2007 and 2006 and
                for the
                period from January 24, 1996 (inception) to December 31,
                2007
            
            F-7Notes
                to Financial Statements
            
            F-8 to F-14




F-1




**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**




We
      have
      audited the accompanying balance sheet of American Petro-Hunter, Inc. (“the
      Company”) (a development stage company) as of December 31, 2007 and the related
      statements of operations, changes in stockholders’ deficit and cash flows for
      the year then ended. These financial statements are the responsibility of the
      Company’s management. Our responsibility is to express an opinion on these
      financial statements based on our audit. Our opinion on the statements of
      operations, changes in stockholders’ deficit and cash flows for the period from
      January 24, 1996 (inception) to December 31, 2007 insofar as it relates to
      amounts for periods prior to January 1, 2007 is based on the reports of other
      auditors.





We
      conducted our audit in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the financial
      statements are free of material misstatement. The Company is not required to
      have, nor were we engaged to perform, an audit of its internal control over
      financial reporting. Our audit included consideration of internal control over
      financial reporting as a basis for designing audit procedures that are
      appropriate in the circumstances, but not for the purpose of expressing an
      opinion on the effectiveness of the Company’s internal control over financial
      reporting. Accordingly, we express no such opinion. An audit includes examining,
      on a test basis, evidence supporting the amounts and disclosures in the
      financial statements. An audit also includes assessing the accounting principles
      used and significant estimates made by management, as well as evaluating the
      overall financial statement presentation. We believe that our audit provides
      a
      reasonable basis for our opinion.





In
      our
      opinion, the financial statements referred to above present fairly, in all
      material respects, the financial position of American Petro-Hunter, Inc. as
      of
      December 31, 2007, and the results of its operations and its cash flows for
      the
      year then ended in conformity with accounting principles generally accepted
      in
      the United States.





The
      accompanying financial statements have been prepared assuming that the Company
      will continue as a going concern. As discussed in Note 1 to the financial
      statements, the Company’s dependence on outside financing, lack of sufficient
      working capital, and recurring losses raise substantial doubt about the
      Company’s ability to continue as a going concern. Management’s plans are
      described in Note 1 to the financial statements. The financial statements do
      not
      include any adjustments that might result from the outcome of this
      uncertainty





/s/
      Berkovits & Company, LLP





Ft.
      Lauderdale, Florida


April
      3,
      2008





F-2









**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**





To
      the
      Stockholders and Directors of


American
      Petro-Hunter Inc.


(A
      Development Stage Company)





We
      have
      audited the accompanying balance sheets of American Petro-Hunter Inc. (a
      development stage company) as of December 31, 2006 and 2005, and the related
      statements of operations, cash flows, and stockholders’ deficiency for each of
      the two years in the period ended December 31, 2006 and for the period from
      inception, January 24, 1996 to December 31, 2006. These financial statements
      are
      the responsibility of the Company’s management. Our responsibility is to express
      an opinion on these financial statements based on our audits.





We
      conducted our audits in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the financial
      statements are free of material misstatement. An audit includes examining,
      on a
      test basis, evidence supporting the amounts and disclosures in the financial
      statements. An audit also includes assessing the accounting principles used
      and
      significant estimates made by management, as well as evaluating the overall
      financial statement presentation. We believe that our audits provide a
      reasonable basis for our opinion.





In
      our
      opinion, the financial statements referred to above present fairly, in all
      material respects, the financial position of the Company as of December 31,
      2006
      and 2005, and the results of its operations and its cash flows for the years
      ended December 31, 2006 and 2005, and the period from inception, January 24,
      1996 to December 31, 2006, in conformity with accounting principles generally
      accepted in the United States of America.





The
      Company is not required to have, nor were we engaged to perform, an audit of
      its
      internal control over financial reporting. Our audits included consideration
      of
      internal control over financial reporting as a basis for designing audit
      procedures that are appropriate in the circumstances, but not for the purpose
      of
      expressing an opinion on the effectiveness of the Company’s internal control
      over financial reporting. Accordingly, we express no such opinion.




The
      accompanying financial statements have been prepared assuming the Company will
      continue as a going concern. As discussed in Note 1 to the financial statements,
      the Company has suffered recurring losses from operations, has negative cash
      flows, has a stockholders’ deficiency and is dependent upon obtaining adequate
      financing to fulfill its exploration activities. These factors raise substantial
      doubt about its ability to continue as a going concern. Management’s plans in
      regard to these matters are also described in Note 1. The financial statements
      do not include any adjustments that might result from the outcome of this
      uncertainty.




Vancouver,
                Canada
            “Morgan
                & Company”March
                21, 2007
            Chartered
                Accountants




Tel:
                (604) 687-5841
              Fax:
                (604) 687-0075
              www.morgan-cas.com
            
            
            
            P.O.
                Box 10007 Pacific Centre
              Suite
                1488 - 700 West Georgia Street
              Vancouver,
                B.C. V7Y 1A1




F-3


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


Balance
      sheets


(Expressed
      in U.S. Dollars)


**As
      of December 31,**





**2007**
            
            **2006****Assets**Cash
            
            $
            6,207
            
            $
            20,783Taxes
                recoverable
            
            
            2,484
            
            
            1,905**Total
                Current Assets**
            
            $
            8,691
            
            $
            22,688**Liabilities
                and Stockholders’ Deficit**Accounts
                payable and accrued liabilities
            
            $
            255,695
            
            $
            219,531Due
                to related parties
            
            
            105,896
            
            
            74,166Loan
                guarantee
            
            
            103,224
            
            
            88,530Note
                payable
            
            
            25,000
            
            
            25,000**Total
                Current Liabilities**
            
            
            489,815
            
            
            407,227Common
                stock 200,000,000 voting shares, par value $0.001 authorized; 8,265,019
                shares issued and outstanding
            
            
            8,265
            
            
            8,265Common
                stock to be issued
            
            
            60,000
            
            
            -Additional
                paid-in capital
            
            
            3,036,128
            
            
            3,036,128Accumulated
                comprehensive loss
            
            
            (89,260
            )
            
            (40,229
            )Deficit
                accumulated during the development stage
            
            
            (3,496,257
            )
            
            (3,388,703
            )**Total
                Stockholders’ Deficit**
            
            
            (481,124
            )
            
            (384,539
            )**Total
                Liabilities and Stockholders’ Deficit**
            
            $
            8,691
            
            $
            22,688





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




F-4


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


Statements
      of Operations


(Expressed
      in U.S. Dollars)




**For the year**
                **ended**
                **December 31,**
                **2007**
              
              **For the year**
                **ended**
                **December 31,**
                **2006**
              
              **For the**
                **period from**
                **January 24,**
                **1996**
                **(inception) to**
                **December 31,**
                **2007****Revenues**
              
              $
              -
              
              $
              -
              
              $
              -**Expenses:**General
                  and administrative
              
              
              92,554
              
              
              61,523
              
              
              1,634,868Executive
                  compensation
              
              
              15,000
              
              
              10,000
              
              
              399,488Finders’
                  fees
              
              
              -
              
              
              -
              
              
              48,000Rent
              
              
              -
              
              
              874
              
              
              61,698Research
                  and development
              
              
              -
              
              
              -
              
              
              566,875Total
                  expenses
              
              
              107,554
              
              
              72,397
              
              
              2,710,929**Loss
                  before other expenses**
              
              
              (107,554
              )
              
              (72,397
              )
              
              (2,710,929
              )**Other
                  expenses:**Write-off
                  loans and advances
              
              
              -
              
              
              -
              
              
              (327,451
              )Loss
                  from discontinued operations
              
              
              -
              
              
              -
              
              
              (365,519
              )Loss
                  from loan guarantee
              
              
              -
              
              
              -
              
              
              (84,858
              )Write-down
                  of investments
              
              
              -
              
              
              (1
              )
              
              (7,500
              )Total
                  other expenses
              
              
              -
              
              
              (1
              )
              
              (785,328
              )**Net
                  loss**
              
              
              (107,554
              )
              
              (72,398
              )
              
              (3,496,257
              )**Other
                  comprehensive loss**Foreign
                  currency translation loss
              
              
              (49,031
              )
              
              (6,380
              )
              
              (89,260
              )**Comprehensive
                  loss**
              
              $
              (156,585
              )
              $
              (78,778
              )
              $
              (3,585,517
              )**Basic
                  and diluted loss per common share**
              
              $
              (0.013
              )
              $
              (0.008
              )**Weighted
                  average number of common shares used in per share
                  calculations**
              
              
              8,265,019
              
              
              8,265,019




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




F-5


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


Statements
      of Changes in Stockholders’ Deficit


(Expressed
      in U.S. Dollars)




**Common Stock**
              
              
              
              
              
              
              
              **Deficit**
                **accumulated****Number of**
                **shares**
                **issued**
              
              **Par Value**
              
              **Additional**
                **paid-in**
                **capital**
              
              **Deferred**
                **compensation**
              
              **Common**
                **stock to**
                **be issued**
              
              **during the**
                **development**
                **stage**
              
              **Accumulated**
                **comprehensive**
                **loss**
              
              **Stockholders’**
                **Equity**
                **(Deficit)**Share
                  issue for cash, net of issue costs
              
              
              10,497,300
              
              $
              10,497
              
              $
              296,833
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              307,330Net
                  income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              4,856
              
              
              -
              
              
              4,856**Balance
                  at December 31, 1996**
              
              
              10,497,300
              
              
              10,497
              
              
              296,833
              
              
              -
              
              
              -
              
              
              4,856
              
              
              -
              
              
              312,186Share
                  issued for cash, net of issue cost
              
              
              187,416
              
              
              187
              
              
              46,850
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              47,037Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (96,386
              )
              
              -
              
              
              (96,386
              )Unrealized
                  foreign exchange gain
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              8,258
              
              
              8,258**Balance
                  at December 31, 1997**
              
              
              10,684,716
              
              
              10,684
              
              
              343,683
              
              
              -
              
              
              -
              
              
              (91,530
              )
              
              8,258
              
              
              271,095Stock
                  reverse split 3:1
              
              
              (7,123,094
              )
              
              (7,123
              )
              
              7,123
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Shares
                  issued
              
              
              7,773,026
              
              
              7,773
              
              
              1,980,833
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,988,606Unrealized
                  foreign exchange loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (8,258
              )
              
              (8,258
              )Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (1,798,830
              )
              
              -
              
              
              (1,798,830
              )**Balance
                  at December 31, 1998**
              
              
              11,334,648
              
              
              11,334
              
              
              2,331,639
              
              
              -
              
              
              -
              
              
              (1,890,360
              )
              
              -
              
              
              452,6131998
                  issuance cancelled
              
              
              (4,800,000
              )
              
              (4,800
              )
              
              (1,339,200
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (1,344,000
              )Share
                  issue costs
              
              
              500,000
              
              
              500
              
              
              85,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              85,500Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (307,331
              )
              
              -
              
              
              (307,331
              )**Balance
                  at December 31, 1999**
              
              
              7,034,648
              
              
              7,034
              
              
              1,077,439
              
              
              -
              
              
              -
              
              
              (2,197,691
              )
              
              -
              
              
              (1,113,218
              )Share
                  issued
              
              
              4,435,570
              
              
              -
              
              
              1,083,791
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,083,791Finders’
                  fees
              
              
              -
              
              
              -
              
              
              48,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              48,000Share
                  purchase warrants
              
              
              -
              
              
              -
              
              
              80,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              80,000Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (547,097
              )
              
              -
              
              
              (547,097
              )**Balance
                  at December 31, 2000**
              
              
              11,470,218
              
              
              7,034
              
              
              2,289,230
              
              
              -
              
              
              -
              
              
              (2,744,788
              )
              
              -
              
              
              (448,524
              )Stock
                  reverse split 10:1
              
              
              (10,323,196
              )
              
              (5,887
              )
              
              5,887
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Share
                  issued
              
              
              4,253,617
              
              
              4,254
              
              
              552,106
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              556,360Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (297,352
              )
              
              -
              
              
              (297,352
              )**Balance
                  at December 31, 2001**
              
              
              5,400,639
              
              
              5,401
              
              
              2,847,223
              
              
              -
              
              
              -
              
              
              (3,042,140
              )
              
              -
              
              
              (189,516
              )Share
                  issued
              
              
              220,000
              
              
              220
              
              
              21,780
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              22,000Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (29,664
              )
              
              -
              
              
              (29,664
              )**Balance
                  at December 31, 2002**
              
              
              5,620,639
              
              
              5,621
              
              
              2,869,003
              
              
              -
              
              
              -
              
              
              (3,071,804
              )
              
              -
              
              
              (197,180
              )Share
                  issued
              
              
              430,000
              
              
              430
              
              
              25,370
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              25,800Other
                  comprehensive loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              17,920
              
              
              (17,920
              )
              
              -Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (57,652
              )
              
              -
              
              
              (57,652
              )**Balance
                  at December 31, 2003**
              
              
              6,050,639
              
              
              6,051
              
              
              2,894,373
              
              
              -
              
              
              -
              
              
              (3,111,536
              )
              
              (17,920
              )
              
              (229,032
              )Share
                  issued for services rendered
              
              
              475,000
              
              
              475
              
              
              56,525
              
              
              (3,226
              )
              
              -
              
              
              -
              
              
              -
              
              
              53,774Other
                  comprehensive loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (9,773
              )
              
              (9,773
              )Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (134,058
              )
              
              -
              
              
              (134,058
              )**Balance
                  at December 31, 2004**
              
              
              6,525,639
              
              
              6,526
              
              
              2,950,898
              
              
              (3,226
              )
              
              -
              
              
              (3,245,594
              )
              
              (27,693
              )
              
              (319,089
              )Shares
                  issued for services rendered
              
              
              -
              
              
              -
              
              
              -
              
              
              3,226
              
              
              -
              
              
              -
              
              
              -
              
              
              3,226Share
                  issued for cash
              
              
              1,739,380
              
              
              1,739
              
              
              85,230
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              86,969Other
                  comprehensive loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (6,156
              )
              
              (6,156
              )Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (70,711
              )
              
              -
              
              
              (70,711
              )**Balance
                  at December 31, 2005**
              
              
              8,265,019
              
              
              8,265
              
              
              3,036,128
              
              
              -
              
              
              -
              
              
              (3,316,305
              )
              
              (33,849
              )
              
              (305,761
              )Other
                  comprehensive loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (6,380
              )
              
              (6,380
              )Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (72,398
              )
              
              -
              
              
              (72,398
              )**Balance
                  at December 31, 2006**
              
              
              8,265,019
              
              
              8,265
              
              
              3,036,128
              
              
              -
              
              
              -
              
              
              (3,388,703
              )
              
              (40,229
              )
              
              (384,539
              )Other
                  comprehensive loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (49,031
              )
              
              (49,031
              )Share
                  subscription received in advance
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              60,000
              
              
              -
              
              
              -
              
              
              60,000Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (107,554
              )
              
              -
              
              
              (107,554
              )**Balance
                  at December 31, 2007**
              
              
              8,265,019
              
              $
              8,265
              
              $
              3,036,128
              
              $
              -
              
              $
              60,000
              
              $
              (3,496,257
              )
              $
              (89,260
              )
              $
              (481,124
              )




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




F-6


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


Statements
      of Cash Flows


(Expressed
      in U.S. Dollars)




**For the year**
                **ended**
                **December 31,**
                **2007**
              
              **For the year**
                **ended**
                **December 31,**
                **2006**
              
              **For the**
                **period from**
                **January 24,**
                **1996**
                **(inception) to**
                **December 31,**
                **2007****Cash
                  flows from operating activities**Net
                  loss
              
              $
              (107,554
              )
              $
              (72,398
              )
              $
              (3,130,738
              )Adjustments
                  to reconcile net loss to net cash used in operating
                  activities:Accrued
                  interest on note payable
              
              
              2,959
              
              
              600
              
              
              3,559Stock
                  purchase warrants issued
              
              
              -
              
              
              -
              
              
              80,000Loss
                  from loan guarantee
              
              
              14,694
              
              
              3,672
              
              
              103,224Shares
                  issued for services rendered
              
              
              -
              
              
              -
              
              
              992,558Stock
                  purchase warrants issued for finders’ fee
              
              
              -
              
              
              -
              
              
              48,000Write
                  down of investment in AEI Trucolor
              
              
              -
              
              
              1
              
              
              7,500Changes
                  in operating assets and liabilities:Increase
                  in taxes recoverable
              
              
              (579
              )
              
              (1,531
              )
              
              (2,484
              )Increase
                  in accounts payable and accrued  liabilities
              
              
              33,205
              
              
              22,268
              
              
              1,835,969Increase
                  in accounts payable to related parties
              
              
              31,730
              
              
              -
              
              
              31,730Net
                  cash used in operating activities
              
              
              (25,545
              )
              
              (47,388
              )
              
              (30,682
              )**Cash
                  flows from financing activities**Stock
                  subscriptions received
              
              
              60,000
              
              
              -
              
              
              562,400Proceeds
                  from note payable
              
              
              -
              
              
              25,000
              
              
              25,000Share
                  issue costs
              
              
              -
              
              
              -
              
              
              (95,732
              )Net
                  cash provided by financing activities
              
              
              60,000
              
              
              25,000
              
              
              491,668**Cash
                  flows from discontinued operations**
              
              
              -
              
              
              -
              
              
              (365,519
              )**Foreign
                  currency translation effect on cash**
              
              
              (49,031
              )
              
              (6,380
              )
              
              (89,260
              )**Change
                  in cash**
              
              
              (14,576
              )
              
              (28,768
              )
              
              6,207**Cash,
                  Beginning of period**
              
              
              20,783
              
              
              49,551
              
              
              -**Cash,
                  End of period**
              
              $
              6,207
              
              $
              20,783
              
              $
              6,207





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





**Supplemental
      Disclosures with Respect to Cash Flows** (Note
      9)




F-7


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


(Expressed
      in U.S. Dollars)


Notes
      to
      Financial Statements


**December
      31, 2007 and 2006**


**1.**
              **Nature
                  and Continuance of
                  Operations**




American
      Petro-Hunter Inc. (“the Company”) was incorporated in the State of Nevada on
      January 24, 1996 as Wolf Exploration Inc. Wolf Exploration Inc., changed its
      name to Wolf Industries Inc. on March 17, 1997, to Travelport Systems Inc.,
      on
      November 21, 2000 and to American Petro-Hunter Inc., on August 17, 2001. The
      Company’s business offices are located in Blaine, Washington, USA.





The
      Company is evaluating the acquisition of certain natural resource projects
      with
      the intent of developing such projects. The Company’s focus is currently in
      locating and assessing potential acquisition targets, including real property,
      oil and gas rights and oil and gas companies.





These
      financial statements have been prepared in accordance with the United States
      generally accepted accounting principles applicable to a going concern, which
      contemplates the realization of assets and the satisfaction of liabilities
      and
      commitments in the normal course of business. The Company is at development
      stage and has no revenue, has limited assets and has accumulated deficit and
      comprehensive losses during the development period of $3,585,517 and requires
      additional funds to maintain its operations. Management’s plan in this regard is
      to raise equity financing as required. There can be no assurance that sufficient
      funding will be obtained. The foregoing matters raise substantial doubt about
      the Company’s ability to continue as a going concern. The financial statements
      do not include any adjustments relating to the recoverability and classification
      of recorded assets, or the amounts of and classification of liabilities that
      might be necessary in the event the Company cannot continue in
      existence.




**2.**
              ****Significant
                  Accounting
                  Policies****




The
      following is a summary of significant accounting policies used in the
      preparation of these financial statements.




**Principles
      in accounting**





These
      financial statements are stated in United States dollars (“U.S. dollars”) and
      have been prepared in accordance with accounting principles generally accepted
      in the United States of America.





**Foreign
      currency translation**





The
      Company’s functional currency is the Canadian dollar and its reporting currency
      is the U.S. dollar. Assets and liabilities denominated in foreign currencies
      are
      translated to U.S. dollars in accordance with Statement of Financial Accounting
      Standards (“SFAS”) No. 52 *“Foreign
      Currency Translation”* using
      the exchange rate in effect at the balance sheet date. Revenues and expenses
      are
      translated at rates approximating exchange rates in effect at the time of the
      transactions. Certain translation adjustments are reported as a separate
      component of stockholders’ deficit, whereas gains or losses resulting from
      foreign currency transactions are included in the results of
      operations.




F-8


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


(Expressed
      in U.S. Dollars)


Notes
      to
      Financial Statements


**December
      31, 2007 and 2006**




**2.**
              ****Significant
                  Accounting Policies
                  (continued)****





**Income
      taxes**





The
      Company adopted the SFAS No. 109, *“Accounting
      for Income Taxes”* .
      Pursuant to SFAS No. 109, deferred income tax assets and liabilities are
      computed for differences between the financial statement carrying amounts and
      the respective tax bases. Deferred tax assets and liabilities are measured
      using
      enacted or substantially enacted tax rates expected to apply to the taxable
      income in the periods in which those differences are expected to affect taxable
      income. Valuation allowances are established when necessary to reduce deferred
      income tax assets to the amount expected to be realized.





Potential
      benefits of net operating losses have not been recognized in the financial
      statements because the Company cannot be assured it is more likely than not
      it
      will utilize the net operating losses carried forward in future
      years.





**Use
      of estimates**





The
      preparation of financial statements, in conformity with accounting principles
      generally accepted in the United States, requires management to make estimates
      and assumptions that affect the reported amount of assets and liabilities and
      disclosure of contingent assets and liabilities at the date of the financial
      statements and the reported amounts of revenues and expenses during the
      reporting period. Actual results could differ from those estimates.





**Stock-based
      compensation**




Effective
      December 1, 2006, the Company adopted the provisions of SFAS No. 123R,
“Share-Based Payment,”(“SFAS 123R”), which establishes standards for the
      accounting for transactions in which an entity incurs liabilities in exchange
      for goods or services that are based on the fair value of the entity’s equity
      instruments or that may be settled by the issuance of those equity
      instruments.





The
      Company has not issued common stock nor granted stock options in exchange for
      services during the years ended December 31, 2007 and 2006.





**Comprehensive
      income (loss)**





The
      Company has adopted SFAS No. 130, *“Reporting
      Comprehensive Income”* ,
      which
      established standards for the reporting and display of comprehensive income/
      loss, its components and accumulated balances in financial
      statements.





**Concentration
      of Credit Risk**





The
      Company maintains its cash in a bank deposit account in the United States,
      which
      at times, may exceed US federally insured limits.




F-9


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


(Expressed
      in U.S. Dollars)


Notes
      to
      Financial Statements


**December
      31, 2007 and 2006**




**2.**
            ****Significant
                Accounting Policies
                (continued)****




**Net
      Loss per share**





The
      Company computes net income (loss) per share in accordance with SFAS No.
      128, *“Earnings
      per share”* which
      requires presentation of both basic and diluted earnings per share (“EPS”) on
      the ace of the income statement. Basic EPS is computed by dividing net income
      (loss) available to common shareholders by the weighted average number of common
      shares outstanding during the year. Diluted EPS gives effect to all dilutive
      potential common shares outstanding during the period using the treasury stock
      method. In computing diluted EPS, the average stock price for the period is
      used
      in determining the number of shares assumed to be purchased from the exercise
      of
      stock options or warrants. Diluted ESP excludes all dilutive potential shares
      if
      their effect is anti-dilutive. Because the Company does not have any potentially
      dilutive securities only basic loss per share is presented in the accompanying
      financial statements.





**Financial
      instruments**





The
      Company’s financial instruments consist of cash, taxes recoverable, accounts
      payable and accrued liabilities, due to related parties, note payable and loan
      guarantee. Unless otherwise noted, it is management’s opinion that the Company
      is not exposed to significant interest, or credit risks arising form these
      financial instruments. The fair values of these financial instruments
      approximate their carrying values because of their relatively short-term
      maturities.





The
      Company operates outside of the United States of America and is exposed to
      foreign currency risk due to the fluctuation between the currency in which
      the
      Company operates in and the U.S. dollars.





**3.**
            **Recent
                Accounting Pronouncements**





The
      following are disclosed as they may be applicable to the Company’s operations
      and have an impact on the Company’s financial statements:





In
      February 2007, the Financial Accounting Standard Board (“FASB”) issued SFAS No.
      159, “ *Establishing the Fair Value Option for Financial Assets and
      Liabilities* (“SFAS
      No. 159”). SFAS No. 159 permits all entities to choose to elect, at specified
      election dates, to measure eligible financial instruments at fair value. An
      entity shall report unrealized gains and losses on items for which the fair
      value option has been elected in earnings, at each subsequent reporting date,
      and recognize upfront costs and fees related to those items in earnings as
      incurred and not deferred. SFAS No. 159 applies to fiscal years beginning after
      November 15, 2007, with early adoption permitted for an equity that has also
      elected to apply the provisions of SFAS No. 157, “ *Fair
      Value Measurements* ”.
      An
      entity is prohibited from retrospectively applying SFAS No. 159, unless it
      chooses early adoption. SFAS No. 159 also applies to eligible items existing
      at
      November 15, 2007 (or early adoption date). The Company is evaluating the impact
      of the adoption of SFAS No. 159 could have on the Company’s financial
      statements.




F-10


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


(Expressed
      in U.S. Dollars)


Notes
      to
      Financial Statements


**December
      31, 2007 and 2006**





**3.**
            **Recent
                Accounting Pronouncements
                (continued)**





In
      September 2006, FASB issued SFAS No. 157, “ *Fair
      Value Measures* ”
(“SFAS
      No. 157”). This Statement defines fair value, establishes a framework for
      measuring fair value in generally accepted accounting principles (GAAP), expands
      disclosures about fair value measurements, and applies under other accounting
      pronouncements that require or permit fair value measurements. SFAS No. 157
      does
      not require any new fair value measurements. However, the FASB anticipates
      that
      for some entities, the application of SFAS No. 157 will change current practice.
      SFAS No. 157 is effective for financial statements issued for fiscal years
      beginning after November 15, 2007, which for the Company would be the fiscal
      year beginning January 1, 2008. The Company is currently evaluating the impact
      of adopting SFAS No. 157 and does not expect that it will have a significant
      effect on its financial position or results of operations.




In
      September 2006, the Securities and Exchange Commission (“SEC”) issued Staff
      Accounting Bulletin (“SAB”) No. 108, “ *Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements* .” SAB
      No. 108 addresses how the effects of prior year uncorrected misstatements
      should be considered when quantifying misstatements in current year financial
      statements. SAB No. 108 requires companies to quantify misstatements using
      a
      balance sheet and income statement approach and to evaluate whether either
      approach results in quantifying an error that is material in light of relevant
      quantitative and qualitative factors. SAB No. 108 is effective for interim
      periods ending after November 15, 2006. The Company is currently evaluating
      the
      impact of adopting SAB No. 108 and does not expect that it will have a
      significant effect on its financial position or results of
      operations.





In
      June
      2006, FASB issued Interpretation No. 48, “ *Accounting
      for Uncertainty in Income Taxes-an Interpretation of FASB Statement No.
      109* .” This
      Interpretation clarifies the accounting for uncertainty in income taxes
      recognized in an enterprise’s financial statements in accordance with FASB No.
      109, “ *Accounting for Income Taxes.* ”
This
      Interpretation prescribes a recognition threshold and measurement attribute
      for
      the financial statement recognition and measurement of a tax position taken
      or
      expected to be taken in a tax return. This Interpretation also provides guidance
      on derecognition, classification, interest and penalties, accounting in interim
      periods, disclosure and transition. This Interpretation is effective for fiscal
      years beginning after December 15, 2006. The Company has determined that the
      adoption of Statement No. 158 does not have any material impact on the Company’s
      results of operations or financial position.





**4.**
            **Related
                Party Transactions**





Amounts
      due to related parties are payable to a director of the Company, a former
      director of the Company, a company owned by a director of the Company, and
      a
      company owned by a former director and officer of the Company. All amounts
      due
      to related parties are non-interest bearing, unsecured and payable on
      demand.





During
      the year ended December 31, 2007, the Company accrued and/or paid executive
      compensation of $15,000 (2006 - $10,000) to a former director.




F-11


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


(Expressed
      in U.S. Dollars)


Notes
      to
      Financial Statements


**December
      31, 2007 and 2006**





**4.**
            **Related
                Party Transactions
                (continued)**





During
      the year ended December 31, 2006, the Company paid accounting fees, rental,
      and
      office expenses of $14,682 to a company owned by a former director and officer,
      which are included in general and administrative expenses.





During
      the year ended December 31, 2007, the Company paid a total of $19,406 (2006
      -
      $8,079) in consulting fees to two companies controlled by a former director
      and
      to a director, which are included in general and administrative
      expenses.





In
      December 2007, the Company entered into a Management and Governance Consultant
      Agreement (the "Agreement") with Sound Energy Advisors, LLC, an affiliated
      entity, whereby it was agreed that the consultant provide the Company with
      management and consulting services for a monthly fee of $2,500. The agreement
      was effective on December 1, 2007 and expires on November 30, 2009 and is
      subject to termination upon 30-day prior written notice by either
      party.





During
      the year ended December 31, 2007, the Company carried out a number of
      transactions with related parties in the normal course of business.





**5.**
            **Note
                Payable**





On
      October 18, 2006, the Company entered into a promissory note agreement with
      VCF
      Capital Corp. (“VCF”), an affiliated company, whereby VCF loaned the Company
      $25,000. The loan bears interest at 12% per annum, is collateralized by a
      general security arrangement over all of the Company’s assets and was payable in
      full on May 18, 2007.





This
      note
      payable was in default at December 31, 2007. During the years ended December
      31,
      2007 and 2006, the Company accrued $6,870 and $600 of interest expense which
      is
      included in general and administrative expenses.




**6.**
            **Loan
                Guarantee**





In
      2004,
      the Company received a demand for payment from Canadian Western Bank (“CWB”)
      pursuant to a guarantee provided by the Company in favor of Calgary Chemical,
      a
      former subsidiary.





The
      Company divested itself of Calgary Chemical in 1998 under an agreement with
      its
      purchaser (a former president). The agreement included an indemnity guarantee,
      whereby the purchaser would indemnify and hold the Company harmless from any
      and
      all liability, loss, damage or expenses.





Upon
      receipt of the claim, the Company accrued the amount of the claim since in
      the
      opinion of legal counsel it is more likely than not that CWB would prevail
      in
      this action.




F-12


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


(Expressed
      in U.S. Dollars)


Notes
      to
      Financial Statements


**December
      31, 2007 and 2006**





**7.**
            **Common
                Stock to be issued**





During
      the year ended December 31, 2007, the Company received full payment towards
      subscriptions to purchase 1,200,000 units at a price of $0.05 per unit. Each
      unit consists of the right to purchase a common share and contains a purchase
      warrant. Each purchase warrant entitles the holder to purchase an additional
      common share at a price of $0.15 through February 23, 2010. At December 31,
      2007, the Company had not issued the common shares and share purchase warrants
      related to these subscriptions.




**8.**
            **Income
                Taxes**





The
      Company’s operations for the years ended December 31, 2007 and 2006 resulted in
      losses, thus no income taxes have been reflected in the accompanying statements
      of operations.





As
      of
      December 31, 2007 and 2006 the Company had the following deferred tax
      asset:





**2007**
            
            **2006**Deferred
                asset related to net operating loss carry-forwards
            
            $
            1,186,000
            
            $
            1,038,000Less:
                Valuation allowance
            
            
            (1,186,000
            )
            
            (1,038,000
            )Deferred
                tax asset recognized
            
            $
            -
            
            $
            -





A
      valuation allowance has been recorded to reduce the net benefit recorded in
      the
      financial statements related to this deferred asset. The valuation allowance
      is
      deemed necessary as a result of the uncertainty associated with the ultimate
      realization of the deferred tax asset. The Company has concluded that it is
      more
      likely than not, that it will not realize the benefit of this deferred tax
      asset.





As
      of
      December 31, 2007, the Company has net operating loss carry-forwards of
      approximately $3,586,000 (2006 - $3,054,000) which may be used to reduce future
      income taxes payable and which expire from 2026 to 2027. Current Federal Tax
      Law
      limits the amount of loss available to offset against future taxable income
      when
      a substantial change in ownership occurs. Therefore, the amount available to
      offset future taxable income may be limited.




F-13


**American
      Petro-Hunter Inc.**


**(A
      Development Stage Company)**


(Expressed
      in U.S. Dollars)


Notes
      to
      Financial Statements


**December
      31, 2007 and 2006**





**8.**
            **Income
                Taxes (continued)**





The
      provision/benefit for income taxes differs from the amount computed by applying
      the statutory federal income tax rate of 34% (2006 - 34%) to the net loss for
      the year. The difference is summarized as follows:




**2007**
            
            **2006**Computed
                tax benefit at statutory rates
            
            $
            37,000
            
            $
            25,000Less:
                Valuation allowance
            
            
            (37,000
            )
            
            (25,000
            )Income
                tax benefit
            
            $
            -
            
            $
            -





**9.**
            **Supplemental
                Disclosure with Respect to Cash
                Flows**




**For the year**
                  **ended**
                  **December 31,**
                  **2007**
                  **(As restated)**
                
                **For the yearended December31,****2006**
                
                **For the periodfrom January 24,1996 (inception)to December 31,2007**Shares
                    issued in settlement of debt
                
                $
                -
                
                $
                -
                
                $
                1,509,667Shares
                    issued for services rendered
                
                $
                -
                
                $
                -
                
                $
                992,558Shares
                    issued for investment
                
                $
                -
                
                $
                -
                
                $
                7,500





**10.**
            **Subsequent
                Event**




Subsequent
      to year end, the Company completed an equity financing for 600,000 units at
      $0.05 per unit for total proceeds of $30,000 to foreign accredited investors.
      Each unit is comprised of one share of the Company’s common stock and a warrant
      to purchase one share of the Company’s common stock at a price per share of
      $0.15 for a period of 3 years from the date of issuance.





**11.**
              **Restatement
                  of Financial Statements**




The
        Company’s disclosure in Note 9, “Supplemental Disclosure with Respect to Cash
        Flows” for the year ended December 31, 2008 has been restated to report the
        amounts for shares issued in settlement of debt, for services rendered, and
        for
        investment purposes for the year ended December 31, 2007 to be $Nil.




F-14


**INDEX
      TO EXHIBITS**





**Exhibit Number**
            
            **Name**3.1(1)
            
            
            Amended
                and Restated Articles of Incorporation4.1(2)
            
            
            1998
                Directors and Officers Option Plan4.2(3)
            
            
            Amended
                1998 Key Personnel Compensation Plan4.3(4)
            
            
            2000
                Stock Option Plan4.4(5)
            
            
            2001
                Stock Option Plan10.1(6)
            
            
            Sale
                Agreement between Wolf Industries Inc. and Gorda Technology Holdings
                Limited10.2(6)
            
            
            License
                Agreement between Wolf Industries Inc. and Andrew Engineering Inc.,
                et
                al10.3(7)
            
            
            Asset
                Purchase Agreement between Wolf Industries Inc. and Andrew Engineering
                Inc.10.4(7)
            
            
            Agreement
                between Wolf Industries Inc., Andrew Engineering Inc., Andrew Rawicz
                and
                GPT Management10.5(8)
            
            
            Letter
                of Intent with Galloway Financial Services10.6(8)
            
            
            Letter
                Agreement with Dancing Star Resources10.7(8)
            
            
            Assignment
                of Lease with Exor Oil Company, LLC10.8(9)
            
            
            Loan
                Agreement with VCF Capital Corp.10.9(9)
            
            
            Form
                of Securities Purchase Agreement10.10
            
            
            Management
                and Governance Consultant Agreement16(10)
            
            
            Letter
                from Morgan and Company23.1
            
            
            Consent
                of Morgan and Company31.1
            
            
            Rule
                13(a) — 14(a)/15(d) — 14(a) Certification (Principal Executive
                Officer)31.2
            
            
            Rule
                13(a) — 14(a)/15(d) — 14(a) Certification (Principal Financial
                Officer)32
            
            
            Section
                1350 Certifications




**Footnotes
      to Exhibits Index**





(1)
            Incorporated
                by reference to Form 10-SB12G dated June 19, 1997.(2)
            Incorporated
                by reference to Form S-8 dated September 10, 1998.(3)
            Incorporated
                by reference to Form S-8 dated December 9, 1998.(4)
            Incorporated
                by reference to Form S-8 dated October 20, 2000.(5)
            Incorporated
                by reference to Form S-8 dated October 2, 2001.(6)
            Incorporated
                by reference to Form 10-QSB for the period ended March 31,
                1998.(7)
            Incorporated
                by reference to Form 10-QSB for the period ended June 30,
                1999.(8)
            Incorporated
                by reference to Form 10-QSB for the period ended September 30,
                2001.(9)
            Incorporated
                by reference to Form 10-KSB for the period ended December 31,
                2006.(10)
            Incorporated
                by reference to Form 8-K/A dated April 14,
                2008.




19


**MANAGEMEMT
      AND GOVERNANCE CONSULTANT AGREEMENT**





**THIS
      AGREEMENT** dated
      effective December 1, 2007, although executed on December 21, 2007 is
      made:





**BETWEEN:**





**American
      Petro-Hunter Inc.**


225
      Marine Drive, Suite 210


Blaine,
      WA 98230 USA





(referred
      to as the “Company")





**AND:**





**Sound
      Energy Advisors LLC**


225
      Marine Drive, Suite 210


Blaine,
      WA 98230 USA





(referred
      to as “Consultant")




**1.**  **Consultation Services**





The
      Company hereby engages the Consultant to perform the following services in
      accordance with the terms and conditions set forth in this Agreement: The
      Consultant will consult with the officers and employees of the Company
      concerning matters relating to corporate management and governance, including
      day-to-day operations, accounting, regulatory compliance, marketing and investor
      relation services.





**2.**  **Terms of Agreement.**





The
      term
      of this Agreement will commence December 1, 2007 and will continue until
      November 30, 2009. Either party may terminate this Agreement by giving the
      other
      party thirty (30) days written notice delivered by registered mail or confirmed
      email.





**3.**  **Place Where Services Will Be Rendered**





The
      Consultant will perform most services in accordance with this Agreement at
      225
      Marine Drive, Blaine, WA 98230. In addition, the Consultant will perform
      services on the telephone and at such other places as designated by the Company
      to perform these services in accordance with this Agreement.





**4.**  **Payment to Consultant**





The
      Consultant will be paid in advance on the 1st day of each month at the rate
      of
      Two Thousand Five Hundred Dollars in US funds (US$ 2,500.00) per month for
      work
      performed in accordance with this Agreement; Provided that the Consultant issues
      an invoice to the Company on or before the first day of each month of the term.
      The Company will reimburse the Consultant for all disbursements, including
      travel, accommodation, printing, postage, long distance telephone charges and
      other related costs, reasonably incurred by the Consultant for the purpose
      of
      the provision of the Consultant’s services to the Company within 10 days of
      having received written receipts in respect of this disbursements, providing
      that any such disbursement exceeding $500.00 must have been approved by the
      Company in advance of its having been incurred; and providing further that
      the
      disbursements must be submitted once a month and will only be reimbursed once
      a
      month. The Consultant has the right to ask the Company for an advance payment,
      if appropriate, to pay for certain disbursements that have been pre-approved
      by
      the Company.







**5.**  **Independent Contractor**





Both
      the
      Company and the Consultant agree that the Consultant will at all times act
      as an
      independent contractor in the performance of its duties under this Contract.
      Accordingly, the Consultant shall be solely responsible for payment of all
      taxes
      including Federal, State and local taxes arising out of the Consultant's
      activities in accordance with this Agreement, including by way of illustration
      but not limitation, Federal and State income tax, business tax, and any other
      taxes or business license fees as may be required to be paid.





**6.**  **Confidential
      Information and Non-Competition**





The
      Consultant agrees that any information received by the Consultant or Gregory
      Leigh Lyons during the performance of the Consultant's obligations pursuant
      to
      this Agreement or otherwise, regarding the business, financial, technological
      or
      other any other affairs of the Company or its personnel will be maintained
      by
      the Consultant and Gregory Leigh Lyons as strictly confidential and will not
      be
      revealed by the Consultant or Gregory Leigh Lyons to any other persons, firms,
      organizations or other entities whatsoever. This covenant shall survive the
      termination of this Agreement.





The
      Consultant agrees that during the term of this Agreement and thereafter, it
      and
      Gregory Leigh Lyons will not compete or attempt to compete with the business
      or
      technology of the Company or in any other respects whatsoever.





**7.**  **Employment of Others**





The
      Company may from time to time request that the Consultant arrange for the
      services of others. All costs to the Consultant for those services will be
      paid
      by the Company.





**8.**  **Signatures**





Both
      the
      Company and the Consultant agree to the above Contract.





**9.**  **Entire Agreement**





This
      agreement contains the entire agreement between the parties hereto with respect
      to the Consultant’s engagement by the Company and supersedes any prior oral or
      written agreements or understandings with respect hereto.





**10.**  **Notices**





All
      notices, requests, demands, and other communications hereunder shall be in
      writing and shall be delivered personally, sent be recognized overnight courier
      or sent by registered or certified mail, return receipt requested, to the other
      parties hereto at his or its address as set forth above, and shall be deemed
      given when delivered, or if sent by registered or certified mail, five (5)
      days
      after mailing. Any party may change the address to which notices, requests,
      demands, and other communications hereunder shall be sent by sending written
      notice of such change of address to the other parties in the manner above
      provided.







**11.**  **Successors and Assigns**





Subject
      to the terms of Paragraph 7, this Agreement shall inure to the benefit of,
      and
      be binding upon, the successors and assigns of the party hereto.





**12.**  **Amendment**





No
      amendment of any provision of the Agreement, or consent to any departure
      therefrom, shall be effective unless the same be in writing signed by the
      parties.





**13.**  **Waiver**





The
      waiver by the Company of any breach of any term or condition of the Agreement
      shall not be deemed to constitute the waiver of any other breach of the same
      or
      any other term or condition hereof.





**14.**  **Severability**





Each
      of
      the terms and provisions of this Agreement is to be deemed severable in whole
      or
      in part and, if any terms or provision or the application thereof in any
      circumstances should be invalid, illegal or unenforceable, the remaining terms
      and provisions or the application of such term or provision to circumstances
      other than those as to which it is held invalid, illegal or unenforceable shall
      not be affected thereby and shall remain in full force and effect.





**15.**  **Governing Law**





This
      agreement and the enforcement thereof shall be governed and controlled in all
      aspect by the laws of the State of Nevada.





**14.**  **Counterparts**





This
      Agreement may be executed in several counterparts and all so executed shall
      constitute one agreement binding on all the parties hereto, notwithstanding
      that
      all the parties are not signatories to the original or the same
      counterpart.





**AMERICAN
      PETRO-HUNTER INC.**





_________________________________________


Gregory
      Leigh Lyons, Director





**SOUND
      ENERGY ADVISORS LLC**




_________________________________________


Gregory
      Leigh Lyons, President