U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    Form 10-Q

Mark One
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    For the period ended December 31, 2008

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

    For the transition period from ____________ to ____________

                       Commission file number: 333-144493

                           Sterling Exploration, Inc.
                 (Name of small business issuer in its charter)

            Nevada                                           N/A
 (State or other jurisdiction               (I.R.S. Employer Identification No.)
of incorporation or organization)

               2416 - 26 Avenue NW, Calgary, Alberta, Canada T2M 2G9
                    (Address of principal executive offices)

                                 (403) 701-6111
                          (Issuer's telephone number)

Securities registered pursuant to                          Name of each exchange
   Section 12(b) of the Act:                                on which registered:
   -------------------------                                --------------------
                                      None

          Securities registered pursuant to Section 12(g) of the Act:
                         Common Stock, $0.001 par value
                                (Title of Class)

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

Indicate by checkmark  whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [X] No [ ]

          Applicable Only to Issuer Involved in Bankruptcy Proceedings
                        During the Preceding Five Years.

                                       N/A

Indicate by  checkmark  whether the issuer has filed all  documents  and reports
required to be filed by Section 12, 13 and 15(d) of the Securities  Exchange Act
of 1934 after the  distribution of securities under a plan confirmed by a court.
Yes[ ] No[ ]

                    Applicable Only to Corporate Registrants

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the most practicable date:

          Class                              Outstanding as of February 10, 2009
          -----                              -----------------------------------
Common Stock, $0.001 par value                          8,055,000

                       Documents Incorporated By Reference

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]
<PAGE>
                           STERLING EXPLORATION, INC.

                                    FORM 10-Q

Part 1. FINANCIAL INFORMATION

Item 1. Financial Statements                                                   4
        Balance Sheets
        Statements of Operations
        Statements of Cash Flows
        Notes to Financial Statements

Item 2. Management's Discussion and Analysis of Financial Condition and
        Results of Operations                                                 12

Item 3. Quantitative and Qualitative Disclosures About Market Risk            16

Item 4. Controls and Procedures                                               16

Part II. OTHER INFORMATION

Item 1. Legal Proceedings                                                     17

Item 1A. Risk Factors                                                         17

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds           17

Item 3. Defaults Upon Senior Securities                                       17

Item 4. Submission of Matters to a Vote of Security Holders                   17

Item 5. Other Information                                                     17

Item 6. Exhibits                                                              19

                                       2
<PAGE>
NOTE REGARDING FORWARD LOOKING STATEMENTS

This Quarterly  Report includes or is based upon estimates  projections or other
"forward  looking  statements".  Such  forward-looking  statements  include  any
projections or estimates  made by us and our  management in connection  with our
business operations. Such forward-looking statements are based on the beliefs of
Sterling  Exploration,  Inc.  When  used in this  Quarterly  Report,  the  words
"anticipate,"   "believe,"   "estimate,"   "expect,"   "intends"   and   similar
expressions,  as they relate to us, are  intended  to  identify  forward-looking
statements,  which  include  statements  relating  to, among other  things,  our
ability to continue to  successfully  compete in the  minerals  exploration  and
development   industry.   While  these  forward  looking  statements,   and  any
assumptions  upon which they are based,  are made in good faith and  reflect our
current information and judgment regarding the direction of our business, actual
results  will almost  always vary,  sometimes  materially,  from any  estimates,
predictions,  projections,  assumptions  or other future  performance  suggested
herein.

Such estimate, projections or other "forward looking statements" involve various
risks and  uncertainties.  We caution the reader that important  factors in some
cases have affected and, in the future,  could materially  affect actual results
and cause actual results to differ  materially from the results expressed in any
such estimates, projections or other "forward-looking statements".

                                       3
<PAGE>
                                     PART I

ITEM 1. FINANCIAL STATEMENTS

STERLING EXPLORATION INC.
Balance Sheets
(An Exploration Stage Company)
(Expressed in US Dollars)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                             December 31,         June 30,
                                                                                2008               2008
                                                                              --------           --------
                                                                             (unaudited)         (audited)

<S>                                                                           <C>                <C>
                                     ASSETS

CURRENT ASSETS
  Cash                                                                        $     80           $ 10,616
                                                                              --------           --------

      TOTAL ASSETS                                                            $     80           $ 10,616
                                                                              ========           ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable and accrued liabilities                                    $     --           $  1,139
  Loans from related party                                                      40,000             35,000
                                                                              --------           --------

      TOTAL CURRENT LIABILITIES                                                 40,000             36,139
                                                                              --------           --------

STOCKHOLDERS' EQUITY
  Capital stock
    Authorized 75,000,000 ordinary voting shares at $0.001 per share
         Issued and outstanding:
  8,055,000 common shares at par  value                                          8,055              8,055
  Additional paid in capital                                                    18,945             18,945
                                                                              --------           --------
                                                                                27,000             27,000
  Deficit accumulated during the exploration stage                             (66,920)           (52,523)
                                                                              --------           --------

TOTAL STOCKHOLDERS' EQUITY                                                     (39,920)           (25,523)
                                                                              --------           --------

      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                              $     80           $ 10,616
                                                                              ========           ========
</TABLE>


Approved on behalf of the board

_______________________________, Director

_______________________________, Director

                                       4
<PAGE>
STERLING EXPLORATION INC.
Statements of Income
(An Exploration Stage Company)
(Expressed in US Dollars)
(Unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                                            Accumulated From
                                            Six Months     Six Months      Three Months    Three Months    Inception Date of
                                              Ended          Ended            Ended           Ended        August 18, 2003 to
                                            December 31,   December 31,     December 31,    December 31,      December 31,
                                               2008           2007             2008            2007               2008
                                            ----------     ----------       ----------      ----------         ----------
<S>                                         <C>            <C>              <C>             <C>                <C>
GENERAL AND ADMINISTRATIVE EXPENSES
  Bank charges and interest                 $      150     $       85       $       52      $       26         $      676
  Filing and transfer agent fees                 1,607         14,898            1,152          12,645             18,368
  Professional fees                             12,420          7,295            5,630           3,295             32,310
  Mineral properties                                --             --               --              --             14,500
  Office expenses                                  220            304               --             250              1,066
                                            ----------     ----------       ----------      ----------         ----------

Total general and administrative expenses       14,397         22,582            6,834          16,216             66,920
                                            ----------     ----------       ----------      ----------         ----------

Net loss                                    $  (14,397)    $  (22,582)      $   (6,834)     $  (16,216)        $  (66,920)
                                            ==========     ==========       ==========      ==========         ==========
EARNINGS PER SHARE - BASIC AND
DILUTED
                                            $    (0.00)    $    (0.00)      $    (0.00)     $    (0.00)
                                            ==========     ==========       ==========      ==========

WEIGHTED AVERAGE OUTSTANDING SHARES          8,055,000      8,055,000        8,055,000       8,055,000
                                            ==========     ==========       ==========      ==========
</TABLE>

                                       5
<PAGE>
STERLING EXPLORATION INC.
Statement of Stockholders' Equity
(An Exploration Stage Company)
(Expressed in US Dollars)
(Unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                                 Deficit
                                                                                               Accumulated      Total
                               Price      Number of                  Additional      Total     During the       Stock-
                                Per        Common            Par      Paid-in       Capital    Exploration      holders'
                               Share       Shares           Value     Capital        Stock        Stage         Equity
                               -----       ------           -----     -------        -----        -----         ------
<S>                            <C>        <C>           <C>          <C>          <C>          <C>            <C>
Balance, August 18, 2003                         --     $     --     $     --      $     --     $      --      $     --
September 5, 2003
  Subscribed for cash          $0.001     2,000,000        2,000           --         2,000            --         2,000
October 30, 2003
  Subscribed for cash          $0.001     1,500,000        1,500           --         1,500                       1,500
Comprehensive loss for the
 period ended June 30, 2004                                                                           (80)          (80)
                                        -----------     --------     --------      --------     ---------      --------
Balance, June 30, 2004                    3,500,000        3,500           --         3,500           (80)        3,420

October 4, 2004
  Subscribed for cash          $0.001     3,000,000        3,000           --         3,000                       3,000
October 27, 2004
  Subscribed for cash          $0.01      1,050,000        1,050        9,450        10,500                      10,500
December 7, 2004
  Subscribed for cash          $0.01        450,000          450        4,050         4,500                       4,500
January 10, 2005
  Subscribed for cash          $0.1          15,000           15        1,485         1,500                       1,500
January 27, 2005
  Subscribed for cash          $0.1          40,000           40        3,960         4,000                       4,000
Net loss                                                                                           (7,547)       (7,547)
                                        -----------     --------     --------      --------     ---------      --------
Balance, June 30, 2005                    8,055,000        8,055       18,945        27,000        (7,627)       19,373
Net loss                                                                                           (7,573)       (7,573)
                                        -----------     --------     --------      --------     ---------      --------
Balance, June 30, 2006                    8,055,000        8,055       18,945        27,000       (15,200)       11,800
                                        -----------     --------     --------      --------     ---------      --------
Net loss                                                                                           (8,409)       (8,409)
                                        -----------     --------     --------      --------     ---------      --------
Balance, June 30, 2007                    8,055,000        8,055       18,945        27,000       (23,609)        3,391
Net loss                                                                                          (28,914)      (28,914)
                                        -----------     --------     --------      --------     ---------      --------
Balance, June 30, 2008                    8,055,000        8,055       18,945        27,000       (52,523)      (25,523)
Net loss                                                                                          (14,397)      (14,397)
                                        -----------     --------     --------      --------     ---------      --------

Balance, December 31, 2008                8,055,000     $  8,055     $ 18,945      $ 27,000     $ (66,920)     $(39,920)
                                        ===========     ========     ========      ========     =========      ========
</TABLE>

                                       6
<PAGE>
STERLING EXPLORATION INC.
Statements of Cash Flows
(An Exploration Stage Company)
(Expressed in US Dollars)
(Unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                                                  Accumulated From
                                                  Six Months      Six Months     Three Months    Three Months    Inception Date of
                                                    Ended           Ended           Ended           Ended        August 18, 2003 to
                                                  December 31,    December 31,    December 31,    December 31,      December 31,
                                                     2008            2007            2008            2007               2008
                                                   --------        --------        --------        --------           --------
<S>                                                <C>             <C>             <C>             <C>                <C>
CASH DERIVED FROM (USED FOR) OPERATING ACTIVITIES
  Net loss for the period                          $(14,397)       $(22,582)       $ (6,834)       $(16,216)          $(66,920)
  Adjustments to reconcile net loss to net cash
   Provided by (used in) operating activities
  Changes in operating assets and liabilities
     Accounts payable                                (1,139)             --              --              --                 --
                                                   --------        --------        --------        --------           --------

      Net cash (used in) operating activities       (15,536)        (22,582)         (6,834)        (16,216)           (66,920)
                                                   --------        --------        --------        --------           --------
FINANCING ACTIVITIES
  Loans from related party                            5,000          15,000           5,000           5,000             40,000
  Shares subscribed for cash                             --              --              --              --             27,000
                                                   --------        --------        --------        --------           --------

      Net cash provided by financing activities       5,000          15,000              --           5,000             67,000
                                                   --------        --------        --------        --------           --------

INVESTING ACTIVITIES                                     --              --              --              --                 --
                                                   --------        --------        --------        --------           --------

      Net cash used for investing activities             --              --              --              --                 --
                                                   --------        --------        --------        --------           --------

Cash increase during the period                     (10,536)         (7,582)         (1,834)        (11,216)                80
Cash beginning of the period                         10,616           8,391           1,914          12,025                 --
                                                   --------        --------        --------        --------           --------

Cash end of the period                             $     80        $    809        $     80        $    809           $     80
                                                   ========        ========        ========        ========           ========
</TABLE>

                                       7
<PAGE>
STERLING EXPLORATION INC.
Notes to Financial Statements
December 31, 2008
(An Exploration Stage Company)
(Expressed in US Dollars)
(Unaudited)
--------------------------------------------------------------------------------

1. NATURE AND CONTINUANCE OF OPERATIONS

     Sterling  Exploration Inc. ("the Company") was incorporated  under the laws
     of State of Nevada,  U.S. on August 18, 2003, with an authorized capital of
     75,000,000 common shares with a par value of $0.001. The Company's year end
     is the end of June. The Company is in the exploration stage of its resource
     business.  During the  period  ended June 30,  2004 the  Company  commenced
     operations by issuing  shares and acquiring a mineral  property  located in
     the Province of Ontario, Canada. The Company has not yet determined whether
     this property  contains  reserves that are  economically  recoverable.  The
     recoverability  of costs incurred for  acquisition  and  exploration of the
     property will be dependent upon the discovery of  economically  recoverable
     reserves,   confirmation  of  the  Company's  interest  in  the  underlying
     property,  the  ability of the  Company to obtain  necessary  financing  to
     satisfy the expenditure  requirements  under the property  agreement and to
     complete  the  development  of the  property  and  upon  future  profitable
     production or proceeds for the sale thereof.

     These  financial  statements  have been  prepared on a going  concern basis
     which  assumes the Company will be able to realize its assets and discharge
     its  liabilities  in the  normal  course of  business  for the  foreseeable
     future.  The Company has incurred  losses since  inception  resulting in an
     accumulated  deficit of $66,920 as at December 31, 2008 and further  losses
     are  anticipated  in the  development of its business  raising  substantial
     doubt  about the  Company's  ability to continue  as a going  concern.  The
     ability to  continue  as a going  concern  is  dependent  upon the  Company
     generating  profitable  operations  in the  future  and/or  to  obtain  the
     necessary  financing  to meet its  obligations  and repay  its  liabilities
     arising  from normal  business  operations  when they come due.  Management
     intends  to  finance  operating  costs  over the next  twelve  months  with
     existing cash on hand and loans from directors and or private  placement of
     common stock.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Basis of Presentation

     The  financial  statements  of the Company have been prepared in accordance
     with  generally  accepted  accounting  principles  in the United  States of
     America and are presented in US dollars.

     Exploration Stage Company

     The  Company  complies  with  the  Financial   Accounting  Standards  Board
     Statement  No. 7, its  characterization  of the  Company as an  exploration
     stage enterprise.

     Mineral Interests

     Mineral  property  acquisition,   exploration  and  development  costs  are
     expensed as incurred until such time as economic  reserves are  quantified.
     To date the Company has not established any proven or probable  reserves on
     its mineral properties.  The Company has adopted the provisions of SFAS No.
     143  "Accounting  for  Asset  Retirement   Obligations"  which  establishes
     standards  for  the  initial  measurement  and  subsequent  accounting  for
     obligations  associated  with the sale,  abandonment,  or other disposal of
     long-lived  tangible assets arising from the  acquisition,  construction or
     development  and for normal  operations of such assets.  As at December 31,
     2008,  any  potential  costs  relating to the  retirement  of the Company's
     mineral property interest has not yet been determined.

                                       8
<PAGE>
STERLING EXPLORATION INC.
Notes to Financial Statements
December 31, 2008
(An Exploration Stage Company)
(Expressed in US Dollars)
(Unaudited)
--------------------------------------------------------------------------------

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     Use of Estimates and Assumptions

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

     The  carrying  value of cash and accounts  payable and accrued  liabilities
     approximates  their  fair  value  because  of the short  maturity  of these
     instruments. Unless otherwise noted, it is management's opinion the Company
     is not exposed to  significant  interest,  currency or credit risks arising
     from these financial instruments.

     Environmental Costs

     Environmental  expenditures that relate to current  operations are expensed
     or  capitalized  as  appropriate.  Expenditures  that relate to an existing
     condition caused by past operations, and which do not contribute to current
     or future revenue generation,  are expensed.  Liabilities are recorded when
     environmental  assessments  and/or remedial  efforts are probable,  and the
     cost can be reasonably estimated.  Generally,  the timing of these accruals
     coincides  with the earlier of  completion  of a  feasibility  study or the
     Company's commitments to plan of action based on the then known facts.

     Income Taxes

     The Company  follows the liability  method of accounting  for income taxes.
     Under  this  method,   deferred  income  tax  assets  and  liabilities  are
     recognized for the estimated tax  consequences  attributable to differences
     between the financial statement carrying values and their respective income
     tax basis (temporary differences). The effect on deferred income tax assets
     and  liabilities  of a change in tax rates is  recognized  in income in the
     period that includes the enactment date.

     At December 31, 2008, a full  deferred tax asset  valuation  allowance  has
     been provided and no deferred tax asset has been recorded.

     Basic and Diluted Loss Per Share

     The  Company  computes  loss per share in  accordance  with  SFAS No.  128,
     "Earnings per Share" which requires  presentation of both basic and diluted
     earnings per share on the face of the statement of  operations.  Basic loss
     per share is computed by dividing net loss available to common shareholders
     by the weighted  average  number of  outstanding  common  shares during the
     period.  Diluted  loss per share  gives  effect to all  dilutive  potential
     common  shares  outstanding  during  the  period.  Dilutive  loss per share
     excludes all potential common shares if their effect is anti-dilutive.

     The Company has no potential  dilutive  instruments and  accordingly  basic
     loss and diluted loss per share are equal.

     Stock-based Compensation

     In December  2004,  the FASB issued SFAS No. 123R,  "Share-Based  Payment",
     which replaced SFAS No. 123, "Accounting for Stock-Based  Compensation" and
     superseded APB Opinion No. 25,  "Accounting for Stock Issued to Employees".
     In January 2005,  the  Securities  and Exchange  Commission  ("SEC") issued
     Staff Accounting  Bulletin ("SAB") No. 107,  "Share-Based  Payment",  which
     provides supplemental  implementation  guidance for SFAS No. 123R. SFAS No.
     123R requires all share-based  payments to employees,  including  grants of

                                       9
<PAGE>
STERLING EXPLORATION INC.
Notes to Financial Statements
December 31, 2008
(An Exploration Stage Company)
(Expressed in US Dollars)
(Unaudited)
--------------------------------------------------------------------------------

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     employee stock options, to be recognized in the financial  statements based
     on the  grant  date  fair  value  of the  award.  SFAS  No.  123R was to be
     effective  for interim or annual  reporting  periods  beginning on or after
     June 15,  2005,  but in April 2005 the SEC  issued a rule that will  permit
     most  registrants to implement SFAS No. 123R at the beginning of their next
     fiscal year,  instead of the next reporting  period as required by SFAS No.
     123R. The pro-forma disclosures  previously permitted under SFAS No. 123 no
     longer will be an alternative  to financial  statement  recognition.  Under
     SFAS No. 123R, the Company must determine the appropriate  fair value model
     to be used for valuing  share-based  payments,  the amortization method for
     compensation cost and the transition method to be used at date of adoption.

     The  transition  methods  include  prospective  and  retroactive   adoption
     options.  Under the  retroactive  options,  prior  periods  may be restated
     either  as of the  beginning  of the year of  adoption  or for all  periods
     presented.  The prospective  method requires that  compensation  expense be
     recorded  for all  unvested  stock  options  and  restricted  stock  at the
     beginning  of the first  quarter of  adoption of SFAS No.  123R,  while the
     retroactive  methods  would  record  compensation  expense for all unvested
     stock  options  and  restricted  stock  beginning  with  the  first  period
     restated. The Company adopted the modified prospective approach of SFAS No.
     123R for the quarter beginning December 1, 2005. The Company did not record
     any  compensation  expense for the period  ended  December 31, 2008 because
     there  were no  stock  options  outstanding  prior  to the  adoption  or at
     December 31, 2008.

     Recent Accounting Pronouncements

     In February  2006,  the FASB issued SFAS No. 155,  "Accounting  for Certain
     Hybrid  Financial  Instruments-an  amendment of FASB Statements No. 133 and
     140",  to simplify  and make more  consistent  the  accounting  for certain
     financial  instruments.  SFAS No. 155 amends SFAS No. 133,  "Accounting for
     Derivative  Instruments  and  Hedging  Activities",  to permit  fair  value
     re-measurement  for  any  hybrid  financial  instrument  with  an  embedded
     derivative  that  otherwise  would require  bifurcation,  provided that the
     whole  instrument  is  accounted  for on a fair value  basis.  SFAS No. 155
     amends  SFAS  No.  140,  "Accounting  for the  Impairment  or  Disposal  of
     Long-Lived Assets", to allow a qualifying  special-purpose entity to hold a
     derivative  financial  instrument  that  pertains to a beneficial  interest
     other than another derivative financial instrument. SFAS No. 155 applies to
     all  financial  instruments  acquired or issued  after the  beginning of an
     entity's  first fiscal year that begins  after  September  15,  2006,  with
     earlier  application  allowed.  This  standard  is not  expected  to have a
     significant  effect on the Company's future reported  financial position or
     results of operations.

     In March 2006, the FASB issued SFAS No. 156,  "Accounting  for Servicing of
     Financial  Assets,  an amendment of FASB Statement No. 140,  Accounting for
     Transfers  and  Servicing  of  Financial  Assets  and   Extinguishments  of
     Liabilities".  This statement requires all separately  recognized servicing
     assets and servicing  liabilities be initially  measured at fair value,  if
     practicable, and permits for subsequent measurement using either fair value
     measurement  with  changes  in fair  value  reflected  in  earnings  or the
     amortization  and  impairment   requirements  of  Statement  No.  140.  The
     subsequent  measurement  of  separately  recognized  servicing  assets  and
     servicing  liabilities at fair value  eliminates the necessity for entities
     that  manage  the  risks   inherent  in  servicing   assets  and  servicing
     liabilities with derivatives to qualify for hedge accounting  treatment and
     eliminates the characterization of declines in fair value as impairments or
     direct write-downs.  SFAS No. 156 is effective for an entity's first fiscal
     year beginning after September 15, 2006. This adoption of this statement is
     not expected to have a significant  effect on the Company's future reported
     financial position or results of operations.

                                       10
<PAGE>
STERLING EXPLORATION INC.
Notes to Financial Statements
December 31, 2008
(An Exploration Stage Company)
(Expressed in US Dollars)
(Unaudited)
--------------------------------------------------------------------------------

3. MINERAL INTERESTS

     On January 20, 2005, the Company entered into a mineral  property  purchase
     agreement to acquire a 100%  interest in one mineral  claim  located in one
     mineral claim located in the Scadding  Township,  Sudbury Mining  Division,
     Ontario for total consideration of $7,000.

     During  the year  ended  June 30,  2006,  exploration  cost of  $7,500  was
     incurred for the mineral property.

4. COMMON STOCK

     The  total  number of common  shares  authorized  that may be issued by the
     Company  is  75,000,000  shares  with a par  value of one tenth of one cent
     ($0.001) per share and no other class of shares is authorized.

     During the period ended June 30, 2005, the Company issued  8,055,000 shares
     of common  stock for total cash  proceeds of $27,000.  At December 31, 2008
     there were no outstanding stock options or warrants.

5. INCOME TAXES

     As of December 31, 2008,  the Company had net operating loss carry forwards
     of  approximately  $66,920 that may be available  to reduce  future  years'
     taxable  income  through  2027.  Future tax  benefits  which may arise as a
     result  of  these  losses  have  not been  recognized  in  these  financial
     statements,  as their  realization  is  determined  not likely to occur and
     accordingly,  the  Company  has  recorded  a  valuation  allowance  for the
     deferred tax asset relating to these tax loss carry-forwards.

                                       11
<PAGE>
ITEM II. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

The following discussion and analysis of our results of operations and financial
position should be read in conjunction with our audited financial statements and
the notes thereto  included  elsewhere in this Quarterly  Report.  Our financial
statements  are prepared in accordance  with U.S. GAAP. All references to dollar
amounts in this section are in U.S. dollars unless expressly stated otherwise.

The  following  discussion  is intended to provide an analysis of our  financial
condition  and  should  be  read  in  conjunction  with  our  audited  financial
statements and the notes thereto. The matters discussed in this section that are
not historical or current facts deal with  potential  future  circumstances  and
developments.  Such forward-looking  statements include, but are not limited to,
the development plans for our growth,  trends in the results of our development,
anticipated  development plans,  operating expenses and our anticipated  capital
requirements and capital  resources.  Our actual results could differ materially
from the results discussed in the forward-looking statements.

OVERVIEW

Sterling  Exploration  Inc.  was  incorporated  in Nevada on August 18,  2003 to
engage in the business of  acquisition,  exploration  and development of natural
resource  properties.  Our  shares  of common  stock  commenced  trading  on the
Over-the-Counter Bulletin Board during April 2008 under the symbol "SRXP:BB".

MINERAL PROPERTIES

At the time of  inception,  we began to seek  capital  and the  development  and
implementation  of  our  business  plan.  Subsequently,  we  identified  certain
potential mineral  properties for acquisition.  As of the date of this Quarterly
Report,  we hold  title to one  mineral  claim,  known as the  Railway  Prospect
Property,  which may contain little or no economic  mineralization.  The Railway
Prospect Property is comprised of sixteen unpatented mining claim units covering
approximately 633 acres. The claim was originally  recorded on January 27, 2004.
On January 20, 2005,  we purchased  the claim from Pilgrim Creek Mining Ltd. for
$7,000.00.

As of the date of this Quarterly Report,  we have re-staked the claim,  which is
now in  good  standing  until  February  2010.  We  have  not  carried  out  any
exploration  work on the claim nor have we incurred any exploration  costs.  Our
geologist  has  concluded  that the Railway  Prospect  Property  claim is a good
prospect for the discovery of gold mineralization. He has recommended a two-base
surface  exploration  program to further  examine the property.  On September 1,
2008,  we received a letter  from our  geologist,  Terry  Louey at Klondike  Bay
Resources  (the  "Geologist  Letter"),  regarding  the status of the  $10,000 of
exploration  work to be done on the Railway  Prospect  Property.  The  Geologist
Letter  stated  that due to  extreme  winter  weather  conditions,  the  Railway
Prospect Property was frozen solid and ground was not able to be broken in order
to proceed with the re-staking of the property.

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<PAGE>
Once the geologist is able to break ground, management anticipates that the cost
of the  proposed  program  is  approximately  $6,000  for the  initial  phase of
exploration and approximately  $10,000 for the second phase. We believe that the
initial  exploration  phase will be supported by generators.  Water required for
exploration  and  development is available in the area.  Management  anticipates
that commencement of phase I of the exploration  program is in the spring/summer
of 2009. On May 5, 2008,  one of our  shareholders  loaned $10,000 to us so that
sufficient  funds are available for  commencement  of phase I of the exploration
program.  During October 2008, this same shareholder  loaned us a further $5,000
and during January 2009 a further $3,500. See "-- Plan of Operation".

 In the event our claim does not  contain any  reserves,  all funds that we have
spent on exploration  will be lost. Even if we complete our current  exploration
program and are successful in identifying a mineral deposit, we will be required
to expend  substantial funds on further drilling and engineering  studies before
we will know if we have a commercially viable mineral deposit or reserve.

There is not a plant or any equipment  currently located on the property.  It is
expected  that the initial  exploration  phase will be supported by  generators.
Water required for  exploration and development of the claim is available in the
area.

RESULTS OF OPERATION

SIX MONTH  PERIOD  ENDED  DECEMBER  31, 2008  COMPARED TO SIX MONTH PERIOD ENDED
DECEMBER 31, 2007.

Our  net  loss  during  the  six  month  period  ended  December  31,  2008  was
approximately  ($14,397) compared to a net loss of ($22,682) for the three month
period ended December 31, 2007 (a decrease of $8,286).

During the six month periods ended December 31, 2008 and 2007, respectively,  we
did not  generate any  revenue.  During the six month period ended  December 31,
2008, we incurred general and administrative expenses in the aggregate amount of
$14,397  compared to $22,682 incurred during the six month period ended December
31, 2007. The general and administrative  expenses incurred during the six month
period ended  December 31, 2008 consisted of: (i) filing and transfer agent fees
of $1,607 (2007:  $14,898);  (ii) professional  fees of $12,420 (2007:  $7,295);
(iii) office expenses of $220 (2006:  $304);  and (iv) bank charges and interest
of $150 (2007: $85).

The  decrease in net loss during the six month  period  ended  December 31, 2008
compared  to the six  month  period  ended  December  31,  2007 is  attributable
primarily  to the  decrease  in filing  and  transfer  agent  fees  based on the
decreased  scale and scope of business  operations.  General and  administrative
expenses  generally include  corporate  overhead,  financial and  administrative
contracted services, marketing and consulting costs.

                                       13
<PAGE>
Our net loss during the six month period ended  December 31, 2008 was  ($14,397)
or ($0.00) per share  compared to a net loss of  ($22,682)  or ($0.00) per share
for the six month period ended December 31, 2007. The weighted average number of
shares outstanding was 8,055,000 at December 31, 2008 and 2007, respectively.

THREE MONTH PERIOD ENDED  DECEMBER 31, 2008 COMPARED TO THREE MONTH PERIOD ENDED
DECEMBER 31, 2007.

Our net  loss  during  the  three  month  period  ended  December  31,  2008 was
approximately  (6,834)  compared to a net loss of ($16,216)  for the three month
period ended December 31, 2007 (a decrease of $9,382).

During the three month periods ended  December 31, 2008 and 2007,  respectively,
we did not generate any  revenue.  During the three month period ended  December
31,  2008,  we incurred  general and  administrative  expenses in the  aggregate
amount of $6,834  compared to $16,216  incurred  during the three  month  period
ended December 31, 2007. The general and administrative expenses incurred during
the three month period  ended  December  31, 2008  consisted  of: (i) filing and
transfer agent fees of $1,152 (2007: $12,645);  (ii) professional fees of $5,630
(2007:  $3,295);  (iii)  office  expenses  of $-0- (2006:  $250);  and (iv) bank
charges and interest of $52 (2007: $26).

The decrease in net loss during the three month  period ended  December 31, 2008
compared to the three  month  period  ended  December  31, 2007 is  attributable
primarily  to the  decrease  in filing  and  transfer  agent  fees  based on the
decreased  scale and scope of business  operations.  General and  administrative
expenses  generally include  corporate  overhead,  financial and  administrative
contracted services, marketing and consulting costs.

Our net loss during the three month period ended  December 31, 2008 was ($6,834)
or ($0.00) per share  compared to a net loss of  ($16,216)  or ($0.00) per share
for the three month period ended December 31, 2007. The weighted  average number
of shares outstanding was 8,055,000 at December 31, 2008 and 2007, respectively.

LIQUIDITY AND CAPITAL RESOURCES

SIX MONTH PERIOD ENDED DECEMBER 31, 2008

Our financial  statements have been prepared assuming that we will continue as a
going  concern  and,  accordingly,  do not include  adjustments  relating to the
recoverability  and realization of assets and classification of liabilities that
might be necessary should we be unable to continue in operation.

As at the six month period ended  December 31, 2008, our current assets were $80
and our current liabilities were $40,000, resulting in a working capital deficit
of $39,020. As at the six month period ended December 31, 2008, our total assets
were $80  consisting  of cash compared to total assets of $10,616 at fiscal year
ended June 30, 2008.  As at the six month period  ended  December 31, 2008,  our
total  liabilities  were  $40,000  consisting  of a loan  from a  related  party
compared to current  liabilities  of $36,139 at fiscal year ended June 30, 2008.
The increase in current  liabilities  was primarily due to the increase in loans
from related party.

                                       14
<PAGE>
Stockholders'  equity/deficit  increased  from  ($25,523) as at June 30, 2008 to
($39,920) as at December 31, 2008.

We have not generated positive cash flows from operating activities. For the six
month period ended December 31, 2008, net cash flow used in operating activities
was  ($15,536)  compared  to net  cash  flow  used in  operating  activities  of
($22,582) for the six month period ended  December 31, 2007.  Net cash flow used
in operating  activities  during the six month  period  ended  December 31, 2008
consisted  primarily  of a net loss of  ($14,397)  and changed by  ($1,139)  for
accounts payable..

During the six month period ended  December 31, 2008,  net cash flow provided by
financing  activities  was  $5,000  compared  to net cash  flow  from  financing
activities of $15,000 for the six month period ended December 31, 2007. Net cash
flow  provided  from  financing  activities  during the six month  period  ended
December  31, 2008  pertained to the $5,000  received as proceeds  from the loan
from related party.

PLAN OF OPERATION

Advances and further private  placements are expected to be adequate to fund our
operations  over the next six  months.  On May 5,  2008,  Lynn  Wigen,  our then
President/Chief  Executive  Officer,  loaned us $10,000 for  purposes of working
capital related to commencement of phase I exploration  program.  During October
2008,  Ms. Wigen loaned us a further  $5,000 and during  January 2009, Ms. Wigen
loaned us a further  $3,500.  We have no lines of credit or other bank financing
arrangements.  Generally,  we  have  financed  operations  to date  through  the
proceeds of the private  placement of equity and debt securities.  In connection
with our business plan, management anticipates that administrative expenses will
increase over the next twelve months. We may also encounter  business  endeavors
that require significant cash commitments or unanticipated  problems or expenses
that could result in a requirement for additional cash.

Additional  issuances of equity or convertible  debt  securities  will result in
dilution  to our  current  shareholders.  Further,  such  securities  might have
rights,  preferences  or  privileges  senior  to our  common  stock.  Additional
financing may not be available  upon  acceptable  terms,  or at all. If adequate
funds are not available or are not available on acceptable  terms, we may not be
able to take advantage of prospective new business  endeavors or  opportunities,
which could  significantly and materially restrict our business  operations.  We
are continuing to pursue external financing  alternatives to improve our working
capital position and to grow the business to the greatest possible extent.

The report of the independent registered public accounting firm that accompanies
our fiscal year end June 30, 2008 and June 30, 2007 audited financial statements
contains an explanatory paragraph expressing substantial doubt about our ability
to continue as a going  concern.  The  financial  statements  have been prepared
"assuming that we will continue as a going concern," which  contemplates that we
will  realize our assets and  satisfy our  liabilities  and  commitments  in the
ordinary course of business.

                                       15
<PAGE>
MATERIAL COMMITMENTS

As of the date of this Quarterly Report, we do not have any material commitments
to which we are a party.

ITEM III. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Market risk represents the risk of loss that may impact our financial  position,
results of  operations or cash flows due to adverse  change in foreign  currency
and interest rates.

EXCHANGE RATE

Our reporting currency is United States Dollars ("USD"). In the event we acquire
any properties  outside of the United States,  the fluctuation of exchange rates
may have  positive or negative  impacts on our results of  operations.  However,
since all of our properties are currently located within the United States,  any
potential  revenue and expenses will be denominated in U.S. Dollar,  and the net
income effect of  appreciation  and  devaluation of the currency  against the US
Dollar would be limited to our costs of acquisition of property.

INTEREST RATE

Interest  rates in the United  States are  generally  controlled.  Any potential
future loans will relate mainly to  acquisition of properties and will be mainly
short-term.  However our debt may be likely to rise in connection with expansion
and if  interest  rates  were to rise at the  same  time,  this  could  become a
significant  impact  on our  operating  and  financing  activities.  We have not
entered  into  derivative  contracts  either  to  hedge  existing  risks  of for
speculative purposes.

ITEM IV. INTERNATL CONTROLS AND PROCEDURES

An evaluation was conducted under the supervision and with the  participation of
our   management,   including  Marc  Gagnon,   our  previous   Chief   Executive
Officer/Chief  Financial Officer, and Ben Anderson,  our current Chief Executive
Officer/Chief  Financial  Officer,  of  the  effectiveness  of  the  design  and
operation of our  disclosure  controls and  procedures  as of December 31, 2008.
Based  on that  evaluation,  Messrs.  Gagnon  and  Anderson  concluded  that our
disclosure controls and procedures were effective as of such date to ensure that
information required to be disclosed in the reports that we file or submit under
the Exchange Act of 1934, as amended,  is recorded,  processed,  summarized  and
reported within the time periods specified in the rules and forms. Such officers
also confirmed  that there was no change in our internal  control over financial
reporting  during  the six  month  period  ended  December  31,  2008,  that has
materially affected,  or is reasonably likely to materially affect, our internal
control over financial reporting.

                                       16
<PAGE>
                                     PART II

ITEM I. LEGAL PROCEEDINGS.

As of the date of this  Quarterly  Report,  we are not aware of any  pending  or
existing legal proceedings  involving our company or its officers and directors.
We are  not  aware  of any  proceedings  being  contemplated  by any  person  or
governmental authority against us, our properties or our officers and directors.

ITEM II. CHANGES IN SECURITIES AND USE OF PROCEEDS

Not applicable.

ITEM III. DEFAULTS UPON SENIOR SECURITIES.

Not applicable.

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

Not applicable.

ITEM V. OTHER INFORMATION.

RESIGNATION

Effective on December 31, 2008, our Board of Directors  accepted the resignation
of  Marc   Gagnon  as  the   President/Chief   Executive   Officer,   Secretary,
Treasurer/Chief  Financial  Officer and a member of the board of directors.  The
resignation of Mr. Gagnon is not a result of any disagreement  between us or Mr.
Gagnon pertaining to matters relating to our operations, policies or practices.

In accordance  with a written  consent of  resolutions of the Board of Directors
dated December 31, 2008, Ben Anderson was duly appointed as the  President/Chief
Executive Officer, Secretary,  Treasurer/Chief Financial Officer and a member of
the Board of Directors.  Therefore, as of the date of this Quarterly Report, our
Board of Directors is comprised of Ben Anderson.

BIOGRAPHY

BEN ANDERSON.  During the past twenty-five  years, Mr. Anderson has been engaged
in  senior  management   capacities,   business  development,   engineering  and
operations  primary  involving  junior oil and gas  exploration  and  production
companies. Mr. Anderson was most recently chief operating officer and a director
of  International  PetroReal Oil  Corporation of Calgary.  He was appointed as a
director in October 2006, and as chief operating officer in September 2007 where
he was instrumental in contributing to that company's successful  reorganization
by leading the  acquisition  of a property  package and high impact  exploration
project.  Formerly,  Mr. Anderson was the president and chief operating  officer
and a director of High Plains Energy Inc., Calgary, where he participated in the

                                       17
<PAGE>
rejuvenation of that junior oil and gas  exploration  and production  company by
leading a  restructuring  that  resulted  in $10  million of new  investment,  a
500%increase  in  production  and reserves and renewed  investor  interest  that
resulted in a 750% increase in capital market value.  Previously,  Mr.  Anderson
served  as the vice  president  of  engineering  for  Rider  Resources  Inc.,  a
TSX-listed,  2000  boe/d oil and gas  exploration,  development  and  production
company   with  annual  cash  flow  of  more  than  $10  million  and  a  market
capitalization  of  approximately  $25  million.  He  was  responsible  for  the
engineering, operations, exploration and business development functions of Rider
Resources Inc. until it was sold in February 2003. From January 2000 to December
2002, Mr. Anderson was the president and chief executive  officer and a director
of Canada Southern  Petroleum Ltd. , a Calgary-based  junior oil and gas company
that was publicly-traded on the TSX and NASDAQ stock exchanges. That company had
production  of 2000  boe/d  and  market  value  up to $250  million  during  Mr.
Anderson's term. During Mr. Anderson's  tenure,  Canada Southern  Petroleum Ltd.
received revenues from its primary producing property of more than more than $12
million  that  had  been  withheld  by the  operator  during  multiple  years of
litigation.  From August 1997 to December 1999, Mr.  Anderson was the president,
chief executive officer and a director of International  Gryphon Resources Inc.,
an emerging "JCP" company  engaged in oil and gas  exploration,  development and
production.   Mr.  Anderson  grew   International   Gryphon  Resources  Inc.  by
establishing  new operating areas,  participating in two discoveries,  improving
production,   increasing   reserves  and  revenue  in  a  challenging   economic
environment.  During the period July 1995 through July 1997,  Mr.  Anderson held
the  position  of  operations  manager at Triumph  Energy  Corporation  where he
assisted that  Calgary-based  corporation to increase  production to 1700 boe/d.
From March 1993 to June 1995, Mr. Anderson was operations  manager for Hillcrest
Resources Ltd., a  publicly-traded  junior oil and gas exploration,  development
and  production  company  where he was part of a team that was  responsible  for
successfully  implementing  a  $40  million  capital  budget  that  resulted  in
production  increases from 1250 boe/d to 5750 boe/d in two years.  Mr.  Anderson
has been  employed in  increasing  capacities  as  petroleum  engineer for Texas
American  Oil  Corporation,  Midland,  Texas;  Production  Engineer,  Bow Valley
Industries,  Calgary;  Operations Engineer, Bralorne Resources Limited, Calgary;
Senior Production Engineer, Ranger Oil Limited, Calgary. In these capacities, he
was responsible for petroleum and reservoir  engineering,  reserves  assessment,
production  and  operations,   optimization  and   exploitation,   drilling  and
completion activities and various other operational functions.

Mr. Anderson achieved the degree of Bachelor of Science in Petroleum Engineering
from the University of Oklahoma in 1981.

RESIGNATION

Effective on September 11, 2008, our Board of Directors accepted the resignation
of Lynn Wigen as the  President/Chief  Executive  Officer and our director.  The
resignation of Ms. Wigen is not a result of any  disagreement  between us or Ms.
Wigen pertaining to matters relating to our operations, policies or practices.

Effective on September 11, 2008, our Board of Directors  accepted the consent of
Marc Gagnon as the President/Chief Executive Officer and our director. Effective
December 31, 2008, Mr. Gagnon resigned.

                                       18
<PAGE>
ITEM VI. EXHIBITS

(a) Exhibits

31.1 Certification of Chief Executive  Officer  pursuant to Securities  Exchange
     Act of 1934 Rule 13a-14(a) or 15d-14(a).

31.2 Certification of Chief Financial  Officer  pursuant to Securities  Exchange
     Act of 1934 Rule 13a-14(a) or 15d-14(a).

32.1 Certifications  pursuant to Securities  Exchange Act of 1934 Rule 13a-14(b)
     or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906
     of the Sarbanes-Oxley Act of 2002.

                                   SIGNATURES

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

                                       Sterling Exploration, Inc.


Date: February 10, 2009                By: /s/ Ben Anderson
                                           -------------------------------------
                                           Ben Anderson, President and
                                           Chief Executive Officer


Date: February 13, 2009                By: /s/ Ben Anderson
                                          --------------------------------------
                                          Ben Anderson, Chief Financial Officer

                                       19