| British Columbia, Canada                                                 |   | 26-0592672                      |
|--------------------------------------------------------------------------|--------|---------------------------------|
| (state or      other jurisdiction of incorporation      or organization) |   | (I.R.S.      Employer I.D. No.) |

----

| PART I - FINANCIAL INFORMATION    | F-1                                                                                                      |
|-----------------------------------|----------------------------------------------------------------------------------------------------------|
|                              | Item 1. Financial Statements (unaudited)                                                                 | F-1 |
|                              |                                                                                                     | Consolidated Balance Sheets (unaudited) | F-1 |
|                              |                                                                                                     | Consolidated Statements of Operations      (unaudited) | F-2 |
|                              |                                                                                                     | Consolidated Statements of Cash Flows      (unaudited) | F-3 |
|                              |                                                                                                     | Notes to the Consolidated Financial Statements      (unaudited) | F-4 |
|                              | Item 2. Management’s Discussion and Analysis of Financial      Condition and Results of Operations | 3 |
|                              | Item 4. Controls and Procedures.                                                                         | 10 |
| PART II – OTHER INFORMATION | 11                                                                                                       |
|                              | Item 1. Legal Proceedings                                                                                | 11 |
|                              | Item 2. Unregistered Sales of Equity Securities and Use of      Proceeds                                 | 11 |
|                              | Item 3. Defaults Upon Senior Securities                                                                  | 12 |
|                              | Item 4. Submission of Matters to a Vote of Security      Holders                                         | 12 |
|                              | Item 5. Other Information                                                                                | 12 |
|                              | Item 6. Exhibits                                                                                         | 12 |

----

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

MANTRA VENTURE GROUP LTD.

|                                                                                                                                                            |   | February      28, 2009$(unaudited) |       |   | May      31, 2008$ |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|------------|--------|--------------------|--------|
| ASSETS                                                                                                                                                          |   |                               |       |   |               |   |
|                                                                                                                                                            |   |                               |       |   |               |   |
| Current      assets                                                                                                                                             |   |                               |       |   |               |   |
|                                                                                                                                                            |   |                               |       |   |               |   |
| Cash                                                                                                                                                            |   |                               | 6,446      |   |               |   | 26,201 |   |
| Amounts      receivable                                                                                                                                         |   |                               | 15,137     |   |               |   | 18,418 |   |
| Prepaid      expenses and deposits                                                                                                                              |   |                               | 19,386     |   |               |   | 1,008 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Total current      assets                                                                                                                                       |   |                               | 40,969     |   |               |   | 45,627 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Intangible      assets                                                                                                                                          |   |                               | 37,815     |   |               |   | 42,815 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Property and      equipment                                                                                                                                     |   |                               | 118,584    |   |               |   | 55,682 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Total      assets                                                                                                                                               |   |                               | 197,368    |   |               |   | 144,124 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| LIABILITIES      AND STOCKHOLDERS’ DEFICIT                                                                                                                |   |                               |       |   |               |   |   |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Current      liabilities                                                                                                                                        |   |                               |       |   |               |   |   |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Accounts      payable and accrued liabilities                                                                                                                   |   |                               | 258,332    |   |               |   | 135,309 |   |
| Accrued      interest payable                                                                                                                                   |   |                               | 9,233      |   |               |   | – |   |
| Due to      related parties (Note 4)                                                                                                                            |   |                               | 60,610     |   |               |   | 103,308 |   |
| Convertible      debentures, net of unamortized discount of $15,408 (Note5)                                                                                     |   |                               | 219,478    |   |               |   | – |   |
| Note payable      (Note 6)                                                                                                                                      |   |                               | 59,430     |   |               |   | – |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Total      liabilities                                                                                                                                          |   |                               | 607,083    |   |               |   | 238,617 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Going concern      (Note 2)                                                                                                                                     |   |                               |       |   |               |   |   |   |
| Commitment      (Note 7)                                                                                                                                        |   |                               |       |   |               |   |   |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Stockholders’      deficit                                                                                                                                |   |                               |       |   |               |   |   |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Preferred      stockAuthorized:      20,000,000 shares, par value $0.00001Issued and outstanding: Nil      shares                                               |   |                               | –    |   |               |   | – |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Common      stockAuthorized: 100,000,000 shares, par      value $0.00001Issued and outstanding: 27,341,180      shares (May 31, 2008 – 23,452,661 shares) |   |                               | 274        |   |               |   | 235 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Additional      paid-in capital                                                                                                                                 |   |                               | 3,030,117  |   |               |   | 1,951,884 |   |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Deficit      accumulated during the development stage                                                                                                           |   |                               | (3,440,106 | )      |               |   | (2,046,612 | ) |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Total      stockholders’ deficit                                                                                                                          |   |                               | (409,715   | )      |               |   | (94,493 | ) |
|                                                                                                                                                            |   |                               |       |   |               |   |   |   |
| Total      liabilities and stockholders’ deficit                                                                                                          |   |                               | 197,368    |   |               |   | 144,124 |   |

----

MANTRA VENTURE GROUP LTD.

|                                                   |   | Three      months endedFebruary      28, |       |   | Nine      months endedFebruary      28, |   |       | Accumulated      fromJanuary      22, 2007 (Inception) to      February      28, |   |
|--------------------------------------------------------|--------|------------------------------------------|------------|--------|-----------------------------------------|--------|------------|---------------------------------------------------------------------------------------|--------|
|                                                   |   | 2009$                                    |       |   | 2008$                                   |   |       | 2009$                                                                                 |   |   | 2008$ |   |   | 2009$  |   |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenues                                               |   |                                     | 1,060      |   |                                    |   | –    |                                                                                  |   |   | 12,118 |   |   |   | – |   |   |   | 12,118 |   |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses                                               |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Advertising      and promotion                         |   |                                     | 24,450     |   |                                    |   | –    |                                                                                  |   |   | 34,301 |   |   |   | – |   |   |   | 34,301 |   |
| Business      development                              |   |                                     | 1,973      |   |                                    |   | 23,979     |                                                                                  |   |   | 3,422 |   |   |   | 39,325 |   |   |   | 204,075 |   |
| Consulting      and advisory                           |   |                                     | 8,642      |   |                                    |   | 220,205    |                                                                                  |   |   | 43,996 |   |   |   | 279,762 |   |   |   | 387,139 |   |
| Depreciation      and amortization                     |   |                                     | 8,782      |   |                                    |   | 662        |                                                                                  |   |   | 27,088 |   |   |   | 1,985 |   |   |   | 48,307 |   |
| General and      administrative                        |   |                                     | 58,436     |   |                                    |   | 48,261     |                                                                                  |   |   | 136,734 |   |   |   | 158,644 |   |   |   | 380,341 |   |
| Management      fees                                   |   |                                     | 51,000     |   |                                    |   | 44,188     |                                                                                  |   |   | 147,000 |   |   |   | 169,102 |   |   |   | 385,700 |   |
| Management      fees - stock-based compensation        |   |                                     | 181,446    |   |                                    |   | –    |                                                                                  |   |   | 232,979 |   |   |   | 21,265 |   |   |   | 254,246 |   |
| Professional      fees                                 |   |                                     | 65,467     |   |                                    |   | 76,299     |                                                                                  |   |   | 231,131 |   |   |   | 212,510 |   |   |   | 423,386 |   |
| Public      listing costs                              |   |                                     | 21,501     |   |                                    |   | 58,491     |                                                                                  |   |   | 29,001 |   |   |   | 59,071 |   |   |   | 176,048 |   |
| Research and      development                          |   |                                     | 47,789     |   |                                    |   | 10,038     |                                                                                  |   |   | 119,911 |   |   |   | 32,994 |   |   |   | 202,339 |   |
| Salaries and      benefits                             |   |                                     | 58,383     |   |                                    |   | –    |                                                                                  |   |   | 103,395 |   |   |   | – |   |   |   | 103,395 |   |
| Shareholder      communications and investor relations |   |                                     | 80,342     |   |                                    |   | 54,648     |                                                                                  |   |   | 249,687 |   |   |   | 87,486 |   |   |   | 433,599 |   |
| Travel                                                 |   |                                     | 5,373      |   |                                    |   | 82,769     |                                                                                  |   |   | 20,896 |   |   |   | 162,789 |   |   |   | 232,009 |   |
| Website and      corporate identity                    |   |                                     | –    |   |                                    |   | 103,840    |                                                                                  |   |   | – |   |   |   | 103,840 |   |   |   | 161,268 |   |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      expenses                                    |   |                                     | 613,584    |   |                                    |   | 723,380    |                                                                                  |   |   | 1,379,541 |   |   |   | 1,328,773 |   |   |   | 3,426,153 |   |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss before      other expenses                        |   |                                     | (612,524   | )      |                                    |   | (723,380   | )                                                                                     |   |   | (1,367,423 | ) |   |   | (1,328,773 | ) |   |   | (3,414,035 | ) |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Other      expenses                                    |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Accretion of      discounts on convertible debentures  |   |                                     | (11,580    | )      |                                    |   | –    |                                                                                  |   |   | (15,408 | ) |   |   | – |   |   |   | (15,408 | ) |
| Interest                                               |   |                                     | (4,777     | )      |                                    |   | –    |                                                                                  |   |   | (10,663 | ) |   |   | – |   |   |   | (10,663 | ) |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Total other      expenses                              |   |                                     | (16,357    | )      |                                    |   | –    |                                                                                  |   |   | (26,071 | ) |   |   | – |   |   |   | (26,071 | ) |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss for      the period                           |   |                                     | (628,881   | )      |                                    |   | (723,380   | )                                                                                     |   |   | (1,393,494 | ) |   |   | (1,328,773 | ) |   |   | (3,440,106 | ) |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss per      share, basic and diluted                 |   |                                     | (0.02      | )      |                                    |   | (0.04      | )                                                                                     |   |   | (0.05 | ) |   |   | (0.07 | ) |   |   |   |   |
|                                                   |   |                                     |       |   |                                    |   |       |                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      average number of shares outstanding     |   |                                     | 27,303,448 |   |                                    |   | 20,459,026 |                                                                                  |   |   | 26,141,886 |   |   |   | 19,140,773 |   |   |   |   |   |

----

MANTRA VENTURE GROUP LTD.

|                                                                                  |   | NineMonths      EndedFebruary      28, 2009 |       |   | NineMonths      EndedFebruary      29, 2008 |   |       | Accumulated      fromJanuary      22, 2007(Inception)      toFebruary      28, 2009 |   |
|---------------------------------------------------------------------------------------|--------|---------------------------------------------|------------|--------|---------------------------------------------|--------|------------|-------------------------------------------------------------------------------------|--------|
|                                                                                  |   | $                                           |       |   | $                                           |   |       | $                                                                                   |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Operating      activities                                                             |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Net loss for      the period                                                          |   |                                        | (1,393,494 | )      |                                        |   | (1,328,773 | )                                                                                   |   |   | (3,440,106 | ) |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Adjustments      to reconcile net loss to net cash used in operating      activities: |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Accretion of      discounts on convertible debentures                                 |   |                                        | 15,408     |   |                                        |   | –    |                                                                                |   |   | 15,408 |   |
| Depreciation      and amortization                                                    |   |                                        | 27,088     |   |                                        |   | 10,001     |                                                                                |   |   | 48,307 |   |
| Stock-based      compensation                                                         |   |                                        | 422,342    |   |                                        |   | 381,717    |                                                                                |   |   | 1,102,426 |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Changes in      operating assets and liabilities                                      |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Amounts      receivable                                                               |   |                                        | 3,281      |   |                                        |   | (14,842    | )                                                                                   |   |   | (15,137 | ) |
| Prepaid      expenses and deposits                                                    |   |                                        | (18,378    | )      |                                        |   | (67        | )                                                                                   |   |   | (19,386 | ) |
| Other      assets                                                                     |   |                                        | –    |   |                                        |   | (12,000    | )                                                                                   |   |   | (12,000 | ) |
| Accounts      payable and accrued liabilities                                         |   |                                        | 197,453    |   |                                        |   | 9,991      |                                                                                |   |   | 332,762 |   |
| Accrued      interest payable                                                         |   |                                        | 9,233      |   |                                        |   | –    |                                                                                |   |   | 9,233 |   |
| Due to      related parties                                                           |   |                                        | (48,617    | )      |                                        |   | (2,179     | )                                                                                   |   |   | 54,691 |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Net cash used      in operating activities                                            |   |                                        | (785,684   | )      |                                        |   | (530,024   | )                                                                                   |   |   | (1,923,802 | ) |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Investing      activities                                                             |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Purchase of      property and equipment                                               |   |                                        | (84,990    | )      |                                        |   | (52,529    | )                                                                                   |   |   | (154,891 | ) |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Net cash used      in investing activities                                            |   |                                        | (84,990    | )      |                                        |   | (52,529    | )                                                                                   |   |   | (154,891 | ) |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Financing      activities                                                             |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Advances from      related parties                                                    |   |                                        | 83,263     |   |                                        |   | –    |                                                                                |   |   | 83,263 |   |
| Repayment of      related party debt                                                  |   |                                        | (77,344    | )      |                                        |   | –    |                                                                                |   |   | (77,344 | ) |
| Proceeds from      exercise of warrants                                               |   |                                        | –    |   |                                        |   | –    |                                                                                |   |   | 137,500 |   |
| Proceeds from      issuance of convertible debentures                                 |   |                                        | 250,000    |   |                                        |   | –    |                                                                                |   |   | 250,000 |   |
| Proceeds from      issuance of common stock                                           |   |                                        | 595,000    |   |                                        |   | 941,420    |                                                                                |   |   | 1,691,720 |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Net cash      provided by financing activities                                        |   |                                        | 850,919    |   |                                        |   | 941,420    |                                                                                |   |   | 2,085,139 |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Change in      cash                                                                   |   |                                        | 19,755     |   |                                        |   | 59,506     |                                                                                |   |   | 6,446 |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Cash,      beginning of period                                                        |   |                                        | 26,201     |   |                                        |   | 13,982     |                                                                                |   |   | – |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Cash, end of      period                                                              |   |                                        | 6,446      |   |                                        |   | 73,488     |                                                                                |   |   | 6,446 |   |
|                                                                                  |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Non-cash      investing and financing activities:                                     |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Common stock      issued for patent                                                   |   |                                        | –    |   |                                        |   | –    |                                                                                |   |   | 10,000 |   |
| Stock options      issued for patent                                                  |   |                                        | –    |   |                                        |   | –    |                                                                                |   |   | 27,854 |   |
| Common stock      issued to settle accounts payable                                   |   |                                        | 15,000     |   |                                        |   | –    |                                                                                |   |   | 15,000 |   |
| Promissory      note issued to settle accounts payable                                |   |                                        | 58,000     |   |                                        |   | –    |                                                                                |   |   | 58,000 |   |
| Fair value of      share purchase warrants issued for convertible debentures          |   |                                        | 45,930     |   |                                        |   | –    |                                                                                |   |   | 45,930 |   |
| Supplemental      disclosures:                                                        |   |                                        |       |   |                                        |   |       |                                                                                |   |   |   |   |
| Interest      paid                                                                    |   |                                        | –    |   |                                        |   | –    |                                                                                |   |   | – |   |
| Income taxes      paid                                                                |   |                                        | –    |   |                                        |   | –    |                                                                                |   |   | – |   |

----

MANTRA VENTURE GROUP LTD.

| 1.   | Basis of      Presentation |
|----------------|----------------------------|

| 2.   | Going      Concern |
|----------------|--------------------|

| 3.   | Recent      Accounting Pronouncements |
|----------------|---------------------------------------|

----

| 3.  | Recent      Accounting Pronouncements(continued) |
|----------|--------------------------------------------------|

| 4.   | Related Party      Transactions |
|----------------|---------------------------------|

| a)   | During the      nine months ended February 28, 2009, the Company generated revenue of      $8,000 (2008 - $Nil) for providing website design services to the spouse      of the President of the Company. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b)   | During the      nine months ended February 28, 2009, the Company incurred management fees      of $58,500 (2008 - $Nil) and issued 50,000 shares of common stock at a      fair value of $20,000 to a company controlled by the Chief Financial      Officer of the Company. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 4.  | Related Party      Transactions (continued) |
|----------|---------------------------------------------|

|  c)   | Included in      accounts payable as at February 28, 2009 is $10,965 owing to the President      of the Company for management fees. As at February 28, 2009, the Company      owes $58,410 to the President of the Company or entities that he controls.      The amounts due are non-interest bearing, unsecured and due on      demand. |
|----------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d)   | Included in      accounts payable as at February 28, 2009 is $7,734 (May 31, 2008 - $Nil)      owing to a company controlled by the Chief Financial Officer of the      Company for management fees. As at February 28, 2009, $2,100 (May 31, 2008      - $Nil) is owed to the Chief Financial Officer of the Company for expenses      paid on behalf of the Company. The amounts due are non-interest bearing,      unsecured and due on demand. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5.   | Convertible      Debentures |
|----------------|-----------------------------|

| 6.   | Note      Payable |
|----------------|-------------------|

| 7.   | Commitment |
|----------------|------------|

| 8.   | Common      Stock |
|----------------|-------------------|

| a)   | On June 15,      2008, the Company issued 37,500 shares of common stock at a fair value of      $7,126 for services rendered. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------|

| b)   | On July 1,      2008, the Company issued 50,000 shares of common stock at a fair value of      $20,000 to the Chief Financial Officer of the  Company. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

| c)   | On July 2,      2008, the Company issued 2,400,000 units at $0.125 per share for proceeds      of $300,000. Each unit consisted of one share of common stock and one      share purchase warrant exercisable at $0.20 per share expiring on July 2,      2009. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d)   | On July 18,      2008, the Company issued 62,500 shares of common stock at a fair value of      $26,250 for services rendered. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------|

| e)   | On September      15, 2008, the Company issued 37,500 shares of common stock at a fair value      of $15,375 for services rendered. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------|

| f)   | On November      30, 2008, the Company issued 1,180,000 units at $0.25 per unit for      proceeds of $295,000 and 40,000 units at $0.25 per unit to settle $10,000      of accounts payable. Each unit consisted of one common share and one-half      non-transferrable warrant to purchase one additional share of common stock      at an exercise price of $0.50 per share expiring on the earlier of two      years or five business days after the Company’s common stock trades at      least one time per day on the FINRA Over the Counter Bulletin Board at a      price at or above $0.80 per share for seven consecutive trading      days |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| g)   | On December      15, 2008, the Company issued 37,500 shares of common stock at a fair value      of $13,500 for services rendered. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------|

| h)   | On January      28, 2009, the Company issued 25,000 shares of common stock at a fair value      of $9,000 for services rendered. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------|

| i)   | On February      10, 2009, the Company issued 18,519 shares of common stock at a fair value      of $5,000 to settle accountspayable. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------|

----

| 9. | Stock      Options |
|----|--------------------|

|                                                    |   | Numberof      options |      |   | Weightedaverageexercise      price$ |   |   | Weighted      average remaining contractual life (years) |   |      |  Aggregateintrinsic      value$ |   |
|---------------------------------------------------------|--------|-----------------------|-----------|--------|-------------------------------------|--------|--------|----------------------------------------------------------|--------|-----------|--------------------------------------|--------|
|                                                    |   |                  |      |   |                                |   |   |                                                     |   |      |                                 |   |
| Outstanding      and exercisable,May 31,      2008      |   |                  | 1,450,000 |   |                                |   | 0.33   |                                                     |   |      |                                 |   |   |   |
|                                                    |   |                  |      |   |                                |   |   |                                                     |   |      |                                 |   |   |   |
| Granted                                                 |   |                  | 1,900,000 |   |                                |   | 0.29   |                                                     |   |      |                                 |   |   |   |
| Cancelled                                               |   |                  | (550,000  | )      |                                |   | 0.25   |                                                     |   |      |                                 |   |   |   |
|                                                    |   |                  |      |   |                                |   |   |                                                     |   |      |                                 |   |   |   |
| Outstanding      and exercisable,February 28,      2009 |   |                  | 2,800,000 |   |                                |   | 0.33   |                                                     |   |  1.7 |                                 |   |  – |   |

| Number      of Options | Exercise      Price      $ |         Expiry Date |
|------------------------|----------------------------|-------------------------------|
|                   |                       |                          |
| 100,000                | 0.20                       | June 9,      2009             |
| 75,000                 | 0.25                       | September 1,      2009        |
| 100,000                | 0.25                       | October 5,      2009          |
| 100,000                | 0.30                       | October 6,      2009          |
| 50,000                 | 0.25                       | October 31,      2009         |
| 100,000                | 0.25                       | January 1,      2010          |
| 50,000                 | 0.40                       | December 13,      2009        |
| 200,000                | 0.75                       | March 5,      2010            |
| 75,000                 | 0.45                       | April 25,      2010           |
| 150,000                | 0.25                       | June 30,      2010            |
| 100,000                | 0.25                       | July 16,      2010            |
| 1,375,000              | 0.30                       | January 7,      2011          |
| 75,000                 | 0.27                       | February 10,      2011        |
| 250,000                | 0.25                       | November 1,      2012         |
|                   |                       |                          |
| 2,800,000              |                       |                          |

|                          | Nine      months endedFebruary      28, 2009 | Nine      months endedFebruary      29, 2008 |
|-------------------------------|----------------------------------------------|----------------------------------------------|
|                          |                                         |                                         |
| Risk-free      Interest rate  | 0.80%                                        | 3.78%                                        |
| Expected life      (in years) | 0.9                                          | 0.9                                          |
| Expected      volatility      | 111%                                         | 73%                                          |

|   | The weighted      average fair value of the stock options granted during 2009 was $0.17 per      option. |
|--------|----------------------------------------------------------------------------------------------------------|

----

| 10.   | Share      Purchase Warrants |
|-----------------|------------------------------|

|                            | Number      of Warrants | Weighted      Average Exercise Price$ |
|---------------------------------|-------------------------|---------------------------------------|
|                            |                    |                                  |
| Balance, May      31, 2008      | 2,823,750               | 0.31                                  |
|                            |                    |                                  |
| Issued                          | 3,260,000               | 0.28                                  |
| Expired                         | (600,000)               | 0.40                                  |
|                            |                    |                                  |
| Balance,      February 28, 2009 | 5,483,750               | 0.28                                  |

| Number      of Warrants | Exercise      Price$ | Expiry      Date       |
|-------------------------|----------------------|------------------------|
|                    |                 |                   |
| 1,600,000               | 0.20                 | May 28,      2009      |
| 2,400,000               | 0.20                 | July 2,      2009      |
| 103,750                 | 0.50                 | November 19,      2009 |
| 6,250                   | 0.50                 | November 20,      2009 |
| 45,000                  | 0.50                 | December 1,      2009  |
| 35,000                  | 0.50                 | December 5,      2009  |
| 221,250                 | 0.50                 | December 10,      2009 |
| 37,500                  | 0.50                 | December 18,      2009 |
| 100,000                 | 0.50                 | February 28,      2010 |
| 75,000                  | 0.50                 | May 1,      2010       |
| 200,000                 | 0.50                 | October 16,      2010  |
| 50,000                  | 0.50                 | October 17,      2010  |
| 610,000                 | 0.50                 | November 30,      2010 |
|                    |                 |                   |
| 5,483,750               |                 |                   |

| 11. | Subsequent      Event |
|-----|-----------------------|

----

Item 2. Management’sDiscussion and Analysis of Financial Condition and Results ofOperations

| ·   | Mantra Energy      Alternatives Ltd., through which we identify, acquire, develop and market      technologies related to alternative energy production, greenhouse gas      emissions reduction and resource consumption  reduction; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Mantra Media      Corp., through which we offer promotional and marketing services to      companies in the sustainability sector or those seeking to adopt      sustainable practices; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Carbon      Commodity Corp., through which we intend to license or develop carbon      footprint assessment software and develop an online carbon reduction      marketplace; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Climate ESCO      Ltd., through which we plan obtain the distribution or licensing rights to      commercialized technologies and broker them to residential and industrial      consumers seeking sustainabilitysolutions; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Mantra Next      Gen Power Inc., through which we anticipate developing technologies in the      alternative energy sector; and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------|

| ·   | Mantra China      Limited, through which we, together with our joint venture partners, plan      to develop our business in Hong Kong and mainland  China. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Description                                                   |   | Expense |      |   | Stock      based/other |   |      | Total  |   |
|---------------------------------------------------------------|--------|---------|-----------|--------|------------------------|--------|-----------|--------|--------|
| Amortization      and accretion                               |   | $       | 48,307    |   |                   | $      | 15,408    |   |   | $ | 83,715 |   |
| Business      development                                     |   |    | 36,671    |   |                   |   | 167,404   |   |   |   | 204,075 |   |
| Consulting      and advisory                                  |   |    | 8,642     |   |                   |   | 378,496   |   |   |   | 387,139 |   |
| Management      fees                                          |   |    | 385,700   |   |                   |   | 254,246   |   |   |   | 639,946 |   |
| Research and      development                                 |   |    | 191,064   |   |                   |   | 11,275    |   |   |   | 202,339 |   |
| Shareholder      communication, awareness and financing costs |   |    | 313,209   |   |                   |   | 120,390   |   |   |   | 433,599 |   |
| Professional      fees                                        |   |    | 381,886   |   |                   |   | 41,500    |   |   |   | 423,386 |   |
| Public      listing and related                               |   |    | 136,048   |   |                   |   | 40,000    |   |   |   | 176,048 |   |
| Website and      corporate identity                           |   |    | 134,293   |   |                   |   | 26,975    |   |   |   | 161,268 |   |
| General,      Administrative and salaries                     |   |    | 687,906   |   |                   |   | 62,138    |   |   |   | 750,046 |   |
| Interest      expense                                         |   |    | 10,663    |   |                   |   | -         |   |   |   | 10,663 |   |
| Total                                                         |   | $       | 2,334,390 |   |                   | $      | 1,117,834 |   |   | $ | 3,452,224 |   |

----

| Description                                                   |   | Expense |    |   | Stock      based |   |    | Total  |   |
|---------------------------------------------------------------|--------|---------|---------|--------|------------------|--------|---------|--------|--------|
| Amortization                                                  |   | $       | 27,088  |   |             | $      | 15,408  |   |   | $ | 42,406 |   |
| Business      development                                     |   |    | 3,422   |   |             |   | -       |   |   |   | 3,442 |   |
| Consulting      and advisory                                  |   |    | 8,642   |   |             |   | 35,354  |   |   |   | 43,996 |   |
| Management      fees                                          |   |    | 147,000 |   |             |   | 232,979 |   |   |   | 379,979 |   |
| Research and      development                                 |   |    | 119,911 |   |             |   | -       |   |   |   | 119,911 |   |
| Shareholder      communication, awareness and financing costs |   |    | 150,091 |   |             |   | 99,596  |   |   |   | 249,687 |   |
| Professional      fees                                        |   |    | 231,131 |   |             |   | -       |   |   |   | 231,131 |   |
| Public      listing and related                               |   |    | 29,001  |   |             |   | -       |   |   |   | 29,001 |   |
| General,      Administrative and salaries                     |   |    | 240,913 |   |             |   | 54,413  |   |   |   | 295,326 |   |
| Interest      expense                                         |   |    | 10,663  |   |             |   | -       |   |   |   | 10,663 |   |
| Total                                                         |   | $       | 967,862 |   |             | $      | 437,750 |   |   | $ | 1,405,612 |   |

----

| Description                                                   |   | Expense |    |   | Stock      based |   |    | Total  |   |
|---------------------------------------------------------------|--------|---------|---------|--------|------------------|--------|---------|--------|--------|
| Amortization                                                  |   | $       | 8,782   |   |             | $      | 11,580  |   |   | $ | 20,362 |   |
| Business      development                                     |   |    | 1,973   |   |             |   | -       |   |   |   | 1,973 |   |
| Consulting      and advisory                                  |   |    | 8,642   |   |             |   | -       |   |   |   | 8,642 |   |
| Management      fees                                          |   |    | 51,000  |   |             |   | 181,446 |   |   |   | 232,446 |   |
| Research and      development                                 |   |    | 47,789  |   |             |   | -       |   |   |   | 47,789 |   |
| Shareholder      communication, awareness and financing costs |   |    | 36,179  |   |             |   | 44,163  |   |   |   | 80,342 |   |
| Professional      fees                                        |   |    | 65,467  |   |             |   | -       |   |   |   | 65,467 |   |
| Public      listing and related                               |   |    | 21,501  |   |             |   | -       |   |   |   | 21,501 |   |
| General,      Administrative and salaries                     |   |    | 92,229  |   |             |   | 54,413  |   |   |   | 146,642 |   |
| Interest      expense                                         |   |    | 4,777   |   |             |   | -       |   |   |   | 4,777 |   |
| Total                                                         |   | $       | 338,339 |   |             | $      | 291,602 |   |   | $ | 629,941 |   |

----

| Date      of issuance | Type      of security      issued                                                           | Number      of securities issued | Price      per security($) | Value($) |
|-----------------------|---------------------------------------------------------------------------------------------|----------------------------------|----------------------------|----------|
| June      2008        | Common Shares      issued for services                                                      | 37,500                           | 0.20                       | 7,500    |
| July      2008        | Units (common      shares and warrants) for cash                                            | 2,400,000                        | 0.125                      | 300,000  |
| July      2008        | Common Shares      for services                                                             | 50,000                           | 0.40                       | 20,000   |
| July      2008        | Common Shares      for services                                                             | 62,500                           | 0.45                       | 26,250   |
| Sep      2008         | Common Shares      for services                                                             | 37,500                           | 0.41                       | 15,375   |
| Oct      2008         | Convertible      Debentures                                                                 | N/A                              | N/A                        | 250,000  |
| Nov      2008         | Units (common      shares and warrants) for cash - $10,000 applied to accounts      payable | 1,220,000                        | 0.25                       | 305,000  |
| Dec      2008         | Common Shares      for services                                                             | 37,500                           | 0.36                       | 13,500   |
| Jan      2009         | Common Shares      for services                                                             | 25,000                           | 0.36                       | 9,000    |
| Feb      2009         | Common Shares      to settle a payable                                                      | 18,519                           | 0.27                       | 5,000    |

----

| Description                                                                                    | Target      completion date or period | Estimated      expenses ($) |
|------------------------------------------------------------------------------------------------|---------------------------------------|----------------------------------|
| Development      of the ERC reactor to demonstration pre-commercial scale                      | March 31,      2010                   | 547,360                          |
| Anticipated      Canadian public listing costs including legal fees and financing      costs   | May 31,      2009                     | 153,000                          |
| Management      and consulting fees (including expenses of our Scientific Advisory      Board) | 12      months                        | 200,000                          |
| Corporate      communication, investor awareness and financing costs                           | 12      months                        | 126,000                          |
| Professional      fees, legal and audit                                                        | 12      months                        | 120,000                          |
| Genera,      administrative and salary expenses                                                | 12      months                        | 150,000                          |
| Travel,      advertising and promotional expenses                                              | 12      months                        | 50,000                           |
| Total                                                                                          |                                  | 1,346,360                        |

----

----

Item 4. Controls and Procedures.

----

PART II – OTHER INFORMATION

Item 1. LegalProceedings.

Item 2. Unregistered Sales of Equity Securities and Use ofProceeds.

| ·   | On December      15, 2008, we issued 37,500 of our common shares to ECON Corporate      Services, Inc. (“ECON”) pursuant to a consulting agreement whereby we      agreed to issue 150,000 common shares to ECON as compensation for investor      services, which shares are to be issued in four quarterly installments      during the term of the agreement. The shares were issued at a price of      $0.36 per share. These securities were issued without a prospectus      pursuant to Regulation S of the SecuritiesAct. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On January      29, 2009 we issued 25,000 shares of our common stock to an employee as a      bonus.  The shares were issued at a price of $0.36 per      share.  These securities were issued without a prospectus      pursuant to Regulation S of the SecuritiesAct. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On February      10, 2009, we converted a debt of $5,000 owed to one of our employees into      our common shares at a rate of $0.27 per share for an aggregate amount of      18,519 shares.  These securities were issued without a      prospectus pursuant to Regulation S of the Securities  Act. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On January 1,      2009, we granted a total of 4 employees options to purchase an aggregate      of 375,000 shares of our common stock at an exercise price of $0.30 per      share pursuant to employment agreements.  The options expire on      January 7, 2011 or upon termination of the employment agreements,      whichever occurs earlier.  These securities were issued without      a prospectus pursuant to Regulation S of the Securities    Act. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On February      10, 2009, we granted a consultant options to purchase 75,000 shares of our      common stock at an exercise price of $0.27 per share pursuant to a      consulting agreement.  The options expire on February 10, 2011      or upon termination of the consulting agreement, whichever occurs      earlier.  These securities were issued without a prospectus      pursuant to Regulation S of the SecuritiesAct. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Item 3. Defaults Upon Senior Securities.

Item 4. Submission of Matters to a Vote of SecurityHolders.

Item 5. Other Information.

Item 6. Exhibits

| ExhibitNo. | Description                                                                                                                                                            |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 31.1       | Certification of the Chief Executive Officer Pursuant to      Rule 13a-14 or 15d-14 of the Exchange Act pursuant to Section 302 of the      Sarbanes-Oxley Act of 2002 |
| 31.2       | Certification of the Chief Financial Officer Pursuant to      Rule 13a-14 or 15d-14 of the Exchange Act pursuant to Section 302 of the      Sarbanes-Oxley Act of 2002 |
| 32.1       | Certification of the Chief Executive Officer Pursuant to      18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the      Sarbanes-Oxley Act of 2002         |
| 32.2       | Certification of the Chief Financial Officer Pursuant to      18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the      Sarbanes-Oxley Act of 2002         |

----

|                           | Mantra      Venture Group Ltd.                            |
|--------------------------------|-----------------------------------------------------------|
|                           | (Registrant)                                              |
|                           |                                                      |
|                           | /s/      Larry Kristof                                    |
| Date: April      14, 2009 | Larry      Kristof                                        |
|                           | President,      Chief Executive Officer, Director         |
|                           |                                                      |
|                           | /s/      Dennis      Petke                                |
| Date: April      14, 2009      | Dennis      Petke                                         |
|                           | Chief      Financial Officer, Principal AccountingOfficer |