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

                                    FORM 10-Q
(Mark One)

[x] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
    1934

                For the quarterly period ended February 28, 2009

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

                 For the transition period from _____ to _______

                       Commission File Number: 333-146561

                          SYNERGY RESOURCES CORPORATION
                   ------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)

                   Colorado                           20-2835920
         (State or other jurisdiction of           (I.R.S. Employer
          incorporation or organization)          Identification No.)

                  20203 Highway 60, Platteville, Colorado 80651
                 ----------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

        Registrant's telephone number including area code: (970) 737-1073

                                       N/A
     ----------------------------------------------------------------------
         Former name, former address, and former fiscal year, if changed
                                since last report

Indicate by check mark whether the registrant (1) filed all reports  required to
be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 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 check mark whether the registrant is a large  accelerated  filer, an
accelerated filer, a non-accelerated  filer, or a smaller reporting company. See
definition  of "large  accelerated  filer",  "accelerated  filer"  and  "smaller
reporting company" in Rule 12b-2 of the Exchange Act.

Larger accelerated filer [ ]                   Accelerated filer [ ]

Non-accelerated filer [ ]                      Smaller reporting company [x]

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

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 10,479,334 shares outstanding
as of April 3, 2009.



<PAGE>

                          SYNERGY RESOURCES CORPORATION

                                      Index

                                                                            Page
                                                                            ----
Part I - FINANCIAL INFORMATION

Item 1.    Financial Statements

           Balance Sheets as of February 28, 2009 (unaudited)
           and August 31, 2008                                               3

           Statements of Operations for the three months ended
           February 28, 2009 and for the period from inception
           (December 28, 2007) to February 29, 2008 (unaudited)              4

           Statements of Operations for the six months ended
           February 28, 2009, for the period from inception
           (December 28, 2007) to February 29, 2008, and for
           the period from inception (December 28, 2007) to
           February 28, 2009 (unaudited)                                     5

           Statements of Cash Flows for the six months ended
           February 28, 2009, for the period from inception
           (December 28, 2007) to February 29, 2008, and for
           the period from inception (December 28, 2007) to
           February 28, 2009 (unaudited)                                     6

           Notes to Financial Statements (unaudited)                         7

Item 2.    Management's Discussion and Analysis of Financial Condition
           and Results of Operations                                        16

Item 4.   Controls and Procedures                                          23

Part II - OTHER INFORMATION

Item 1.    Legal Proceedings                                                24

Item 2.    Unregistered Sales of Equity Securities and Use of
           Proceeds                                                         24

Item 3.    Defaults Upon Senior Securities                                  24

Item 4.    Submission of Matters to a Vote of Security Holders              24

Item 5.    Other Information                                                24

Item 6.    Exhibits                                                         25

SIGNATURES                                                                  26




                                       2
<PAGE>

                          SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                                 BALANCE SHEETS

                                                     February 28,    August 31,
                                                         2009          2008
                                                     ------------   ------------
                                                     (Unaudited)
                        ASSETS
                        ------
Current assets:
 Cash and cash equivalents                           $ 1,800,890    $ 2,292,341
 Other current assets                                     41,469         27,412
                                                     ------------   ------------
   Total current assets                                1,842,359      2,319,753
                                                     ------------   ------------
Property and equipment, at cost:
 Oil and gas properties, full cost method                617,845              -
 Other property and equipment, net                         1,263              -
                                                     ------------   ------------
     Property and equipment, net                         619,108              -
                                                     ------------   ------------
Other assets:
 Option to acquire mineral interests -
  related party                                           60,000              -
 Deferred offering costs                                  20,000              -
                                                     ------------   ------------
   Total other assets                                     80,000              -
                                                     ------------   ------------
   Total assets                                      $ 2,541,467    $ 2,319,753
                                                     ============   ============
         LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
 Accounts payable                                    $   248,452    $    12,473
 Accrued taxes and expenses                               45,883         40,853
                                                     ------------   ------------
    Total current liabilities                            294,335         53,326
                                                     ------------   ------------

Shareholders' equity:
 Preferred stock - $0.01 par value, 10,000,000
  shares authorized:
   no shares issued and outstanding                            -              -
 Common stock - $0.001 par value, 100,000,000
  shares authorized:
   10,479,334 and 9,943,571shares issued
   and outstanding at February 28, 2009
   and August 31, 2008, respectively                      10,479          9,944
 Additional paid-in capital                            9,862,999      2,477,511
 Stock subscriptions receivable                                -        (27,650)
 (Deficit) accumulated during the exploration
   stage                                              (7,626,346)      (193,378)
                                                     ------------   ------------
   Total shareholders' equity                          2,247,132      2,266,427
                                                     ------------   ------------
      Total liabilities and shareholders' equity     $ 2,541,467    $ 2,319,753
                                                     ============   ============

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


                                       3
<PAGE>

                          SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                            STATEMENTS OF OPERATIONS
            for the three months ended February 28, 2009 and for the
         period from Inception (December 28, 2007) to February 29, 2008
                                   (Unaudited)

                                                                 Inception
                                        Three Months Ended  (December 28, 2007)
                                        February 28, 2009   to February 29, 2008
                                       -------------------- --------------------
Revenues                                  $          -         $          -
                                       -------------------- --------------------
Expenses:
 Oil and gas operating expenses                  3,176                    -
 Administrative services contract -
  related party                                 60,000                    -
 Salaries and payroll taxes                    111,577                    -
 Consulting fees - related party                30,000                    -
 Professional fees                              65,868                    -
 Insurance                                      11,949                    -
 Share based compensation - stock
  options granted                            3,427,849                    -
 All other general and administrative           11,792                    -
                                       -------------------- --------------------
    Total expenses                           3,722,211                    -
                                       -------------------- --------------------
Operating (loss)                            (3,722,211)                   -

   Interest income                               4,179                    -
                                       -------------------- --------------------
(Loss) before taxes                         (3,718,032)                   -

Provision for income taxes                           -                    -
                                       -------------------- --------------------
Net (loss)                             $    (3,718,032)     $             -
                                       ==================== ====================
Net (loss) per common share:
 Basic and Diluted                     $         (0.36)
                                       ====================
Weighted average shares outstanding:
 Basic and Diluted                          10,228,393
                                       ====================

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


                                       4
<PAGE>


                          SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                            STATEMENTS OF OPERATIONS
                   for the six months ended February 28, 2009,
     for the period from Inception (December 28, 2007) to February 29, 2008,
   and for the period from Inception (December 28, 2007) to February 28, 2009
                                   (Unaudited)

                                                      Inception     Inception
                                         Six Months  (December 28, (December 28,
                                           Ended       2007) to      2007) to
                                        February 28,  February 29,  February 28,
                                           2009          2008          2009
                                        ------------  ------------  ------------

Revenues                                $         -   $         -   $         -
                                        ------------  ------------  ------------
Expenses:
 Oil and gas operating expenses               5,576             -         5,576
 Administrative services contract
  - related party                           120,000             -       173,333
 Salaries and payroll taxes                 215,446             -       287,828
 Consulting fees - related party             60,000             -        60,000
 Professional fees                          141,056             -       182,154
 Insurance                                   20,011             -        20,011
 Share based compensation - stock
  options granted                         6,852,604             -     6,880,804
 All other general and administrative        29,917             -        31,175
                                        ------------  ------------  ------------
   Total expenses                         7,444,610             -     7,640,881
                                        ------------  ------------  ------------
Operating (loss)                         (7,444,610)            -    (7,640,881)
  Interest income                            11,642             -        14,535
                                        ------------  ------------  ------------
(Loss) before taxes                      (7,432,968)            -    (7,626,346)
Provision for income taxes                        -             -             -
                                        ------------  ------------  ------------
Net (loss)                              $(7,432,968)  $         -   $(7,626,346)
                                        ============  ============  ============
Net (loss) per common share:
 Basic and Diluted                      $     (0.70)
                                        ============
Weighted average shares outstanding:
 Basic and Diluted                       10,553,073
                                        ============


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


                                       5
<PAGE>


                          SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                            STATEMENTS OF CASH FLOWS
                   for the six months ended February 28, 2009,
     for the period from Inception (December 28, 2007) to February 29, 2008,
   and for the period from Inception (December 28, 2007) to February 28, 2009
                                   (Unaudited)

                                                      Inception     Inception
                                         Six Months  (December 28, (December 28,
                                           Ended       2007) to      2007) to
                                        February 28,  February 29,  February 28,
                                           2009          2008          2009
                                        ------------  ------------  ------------
Cash flows from operating activities:
 Net (loss)                             $(7,432,968)  $         -   $(7,626,346)
                                        ------------  ------------  ------------
 Adjustments to reconcile net (loss)
  to net cash (used in) operating
  activities:
  Share based compensation                6,852,604             -     6,880,804
  Depreciation                                   74             -            74
 Changes in operating assets
  and liabilities
   (Increase) in other current assets       (14,057)            -       (41,469)
   Increase in accounts payable             235,979             -       248,452
   Increase in accrued taxes
    and expenses                              5,030             -        45,883
   Effect of merger on perating
    assets (liabilities)                    (31,438)            -       (31,438)
                                        ------------  ------------  ------------
 Total adjustments                        7,048,192             -     7,102,306
                                        ------------  ------------  ------------
   Net cash (used in) operating
     activities                            (384,776)            -      (524,040)
                                        ------------  ------------  ------------
Cash flows from investing activities:
 Acquisition of property and equipment     (580,057)            -      (580,057)
 Option to acquire mineral interests
  - related party                           (60,000)            -       (60,000)
 Cash aquired in merger                       3,987             -         3,987
                                        ------------  ------------  ------------
 Net cash (used in) investing
  activities                               (636,070)            -      (636,070)
                                        ------------  ------------  ------------
Cash flows from financing activities:
 Cash proceeds from sale of stock           774,295             -     3,319,900
 Offering costs                            (223,900)            -      (337,900)
 Payment of deferred offering costs         (20,000)            -       (20,000)
 Repurchase of shares                        (1,000)            -        (1,000)
                                        ------------  ------------  ------------
 Net cash provided by financing
  activities                                529,395             -     2,961,000
                                        ------------  ------------  ------------
Net increase (decrease) in cash
 and equivalents                           (491,451)            -     1,800,890
Cash and equivalents at beginning
 of period                                2,292,341             -             -
                                        ------------  ------------  ------------
Cash and equivalents at end of
 period                                 $ 1,800,890   $         -   $ 1,800,890
                                        ============  ============  ============
Supplemental Cash Flow Information:
 Interest paid                          $         -   $         -   $         -
                                        ============  ============  ============
   Income taxes paid                    $         -   $         -   $         -
                                        ============  ============  ============
Non-cash investing and financing
activities:
 Net assets acquired in merger          $    11,675   $         -   $    11,675
                                        ============  ============  ============

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


                                       6
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

1.     Description of Business and Summary of Significant Accounting Policies

     Basis  of  Presentation:  Synergy  Resources  Corporation  (the  "Company")
represents  the result of a merger  transaction  on  September  10, 2008 between
Brishlin Resources, Inc. ("Predecessor Brishlin"), a public company, and Synergy
Resources Corporation ("Predecessor Synergy"), a private company. In conjunction
with the transaction, Predecessor Brishlin changed its name to Synergy Resources
Corporation and Predecessor Synergy changed its name to Synergy Resources,  Ltd.
The Company was organized  under the laws of the State of Colorado.  The Company
is in its  exploration  stage and  plans to engage in oil and gas  acquisitions,
exploration,  development and production  service  activities,  primarily in the
area known as the Denver-Julesburg Basin. The Company has adopted August 31st as
the end of its fiscal year.

     Interim Financial  Information:  The interim financial  statements included
herein have been prepared by the Company,  without audit,  pursuant to the rules
and regulations of the Securities and Exchange Commission ("SEC") as promulgated
in Item 210 of Regulation  S-X.  Certain  information  and footnote  disclosures
normally included in financial statements prepared in accordance with accounting
principles  generally  accepted in the United States of America ("US GAAP") have
been  condensed  or  omitted  pursuant  to such SEC rules and  regulations.  The
Company  believes  that  the  disclosures  included  are  adequate  to make  the
information  presented  not  misleading,  and  recommends  that these  financial
statements be read in  conjunction  with the audited  financial  statements  and
notes  thereto for the period ended  August 31, 2008,  included in our Report on
Form 8-K/A filed on November 26, 2008.

     In management's  opinion,  the unaudited  balance sheets as of February 28,
2009,  the unaudited  statements of operations for the three month and six month
periods ended February 28, 2009,  and the unaudited  statement of cash flows for
the six month period ended  February 28,  2009,  contained  herein,  reflect all
adjustments,  consisting  solely of normal recurring items,  which are necessary
for the fair  presentation  of the  Company's  financial  position,  results  of
operations,  and cash flows on a basis consistent with that of its prior audited
financial statements. However, the results of operations for interim periods may
not be indicative of results to be expected for the full fiscal year.

     Reclassifications:  Certain amounts previously  presented for prior periods
have  been   reclassified  to  conform  with  the  current   presentation.   The
reclassifications   had  no  effect  on  net  loss,   total  assets,   or  total
shareholders' equity.



                                       7
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

     Merger Transaction: On September 10, 2008, Predecessor Brishlin consummated
an  Agreement  to Exchange  Common  Stock  ("Exchange  Agreement")  with certain
shareholders  of  Predecessor  Synergy  to  acquire  approximately  89%  of  the
outstanding common stock of Predecessor Synergy. In subsequent transactions, all
the remaining  outstanding  common shares of Predecessor  Synergy were acquired.
Prior to September 10, 2008,  Predecessor  Brishlin had 1,038,000  common shares
outstanding,  and Predecessor  Synergy had 9,960,000 common shares  outstanding.
The merger  transaction  resulted in the Company with  10,998,000  common shares
outstanding,  with the shareholders of Predecessor Synergy holding approximately
91% of the  outstanding  shares and the  shareholders  of  Predecessor  Brishlin
holding approximately 9% of the outstanding shares.

     The  Exchange  Agreement  further  provided  that the  Company  would issue
substitute  Series A  warrants  to  replace  similar  warrants  held by  certain
shareholders of Predecessor Synergy to purchase 2,060,000 shares of common stock
at $6.00 per share. Furthermore,  the Company agreed to issue substitute options
to replace similar options  outstanding prior to the merger  transaction,  which
options  provide for the purchase of  2,000,000  shares of common stock at $1.00
per share and 2,000,000 shares of common stock at $10.00 per share.

     Immediately  prior to the  transaction,  Predecessor  Brishlin  completed a
one-for-ten  reverse stock split of its outstanding  common stock. All share and
per share data  presented  in this  Report have been  retroactively  restated to
reflect the reverse stock split.

     In anticipation of the merger transaction,  Predecessor Brishlin declared a
dividend to its shareholders of record as of August 28, 2008,  consisting of one
Series A warrant for each common share held.

     Although  the legal form of the  transaction  reflects the  acquisition  of
Predecessor  Synergy by Predecessor  Brishlin,  the Company  determined that the
accounting form of the transaction is a "reverse  merger",  in which Predecessor
Synergy is  identified  as the  acquiring  company and  Predecessor  Brishlin is
identified as the acquired company. At the time of the transaction,  Predecessor
Brishlin had ceased most of its operations and liquidated most of its assets and
liabilities. In accordance with SEC regulations, the transaction was recorded as
a capital  transaction  rather than a business  combination.  The transaction is
equivalent  to the issuance of common stock by  Predecessor  Synergy in exchange
for the net assets of Predecessor Brishlin and a recapitalization of Predecessor
Synergy. The assets and liabilities of Predecessor Brishlin were not restated to
their  estimated fair market values and no goodwill or other  intangible  assets
were  recorded.   Selected  financial  data  for  Predecessor  Brishlin  at  the
transaction date follows:



                                       8
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

      Selected Financial Data:
      -----------------------

           Cash                                    $   3,986
           Current assets                              5,129
           Oil and gas assets                         39,125
           Current liabilities                        33,907
           Net assets                               $ 11,675

     Financial  information  for all periods  subsequent  to September  10, 2008
includes the combined  assets,  liabilities  and  activities of both  companies.
Historical  financial  information  for periods  prior to  September  10,  2008,
presented for comparative purposes, includes only Predecessor Synergy.

     Condensed pro-forma  information  assuming that the transaction occurred on
September  1, 2008  (beginning  of  fiscal  year for the  Company)  has not been
presented.  As  Predecessor  Brishlin had  substantially  reduced its operations
prior  to  the  transaction,   there  is  no  material  difference  between  the
information presented in the financial statements and the pro-forma information.

     Per Share  Amounts:  SFAS  128,  "Earnings  per  Share,"  provides  for the
calculation  of "Basic" and  "Diluted"  earnings per share.  Basic  earnings per
share  include no dilution  and is computed by dividing  net income (or loss) by
the  weighted-average  number of shares outstanding  during the period.  Diluted
earnings per share reflect the potential dilution of securities that could share
in the earnings of the  Company,  similar to fully  diluted  earnings per share.
During the periods since inception, the Company has issued 7,679,334 potentially
dilutive  securities,  all of which were excluded from the  calculation  because
they were anti-dilutive.

     Use of Estimates:  The  preparation  of financial  statements in conformity
with US GAAP requires  management to make estimates and assumptions  that affect
the reported  amount of assets and  liabilities  and  disclosure  of  contingent
assets and liabilities at the date of the financial  statements and the reported
amounts of  revenues  and  expenses  during  the  reporting  period.  Management
routinely  makes  judgments and estimates  about the effects of matters that are
inherently uncertain. Management bases its estimates and judgments on historical
experience and on various other factors that are believed to be reasonable under
the  circumstances,  the  results of which  form the basis for making  judgments
about the  carrying  values  of  assets  and  liabilities  that are not  readily
apparent from other sources.  Actual results could differ from these  estimates.
Estimates and assumptions are revised  periodically and the effects of revisions
are reflected in the  financial  statements in the period it is determined to be
necessary.

     Recent Accounting  Pronouncements:  On December 29, 2008, the SEC announced
final  approval of new  requirements  for  reporting  oil and gas reserves to be
effective  in  January  2010.  The  new  disclosure   requirements  provide  for
consideration  of new  technologies in evaluating  reserves,  allow companies to


                                       9
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

disclose their probable and possible  reserves to investors,  report oil and gas
reserves  using an average  price based on the prior 12 month period rather than
year-end  prices,  and  revise  the  disclosure  requirements  for  oil  and gas
operations. The accounting for the limitation on capitalized costs for full cost
companies  will also be revised.  The new rule is expected to be  effective  for
years  ending on or after  December 31, 2009,  although  the  transition  may be
extended.  The  Company  has not yet  evaluated  the  effects  on its  financial
statements and disclosures.

     There were various other accounting  standards and  interpretations  issued
recently,  none  of  which  are  expected  to a have a  material  impact  on the
Company's financial position, operations or cash flows.

2.   Going Concern

     The Company's  financial  statements are prepared on a going concern basis,
which contemplates the realization of assets and the satisfaction of obligations
in the normal course of business. The Company has no source of operating revenue
to date and has financed  operations through the sale of equity. The Company has
incurred losses since its inception  aggregating  $7,626,346.  These  conditions
raise  substantial doubt about the ability of the Company to continue as a going
concern.

     The Company has raised cash proceeds of $2,961,000,  net of offering costs,
from sales of common stock since  inception.  Management  believes that the cash
balance of  $1,800,890  at February 28, 2009 will not be  sufficient to fund its
operating  activities and other capital  resource demands during the next twelve
months.

     The Company's ability to continue as a going concern is contingent upon its
ability to raise funds through the sale of equity,  joint venture or sale of its
assets, and attaining  profitable  operations.  The financial  statements do not
include  any  adjustments  to  the  amount  and  classification  of  assets  and
liabilities  that may be  necessary  should the Company not  continue as a going
concern.

3.   Property and Equipment

     Oil and gas properties  consists of various interests in oil and gas leases
and wells in progress. The Company has an option to acquire working interests in
oil and gas leases currently owned by related parties PM and PEM as described in
Note 6. In November, 2008, the Company participated in an auction of oil and gas
leases  conducted by the State of Colorado and was awarded leases to 1,600 acres
for total  consideration  of $113,600.  The leases have a term of five years. In
February,  2009, the Company  participated in an auction of leases  conducted by
the Bureau of Land  Management  and was awarded  leases to 2,000 acres for total
consideration of $45,000.  The leases have a term of ten years. The Company also
acquired several leases in private  transactions  covering  approximately  3,000
acres for total consideration approximating $136,000. The leases have terms


                                       10
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

ranging from two to five years.  As of March 31, 2009, the Company had interests
in approximately  6,700 net acres,  none of which were included in the full cost
pool subject to amortization.

     The Company recently  participated in two wells drilled by Kerr-McGee Oil &
Gas Onshore LP (`KM"). As of March, 31, 2009, these wells were in the completion
stage. The Company has a 37.5% working interest  (28.125% net revenue  interest)
in each well and expects that its proportionate share of drilling and completing
these wells will approximate $570,000.

     Property and equipment at February 28, 2009, consisted of the following:

       Oil and Gas Properties, full cost method:
        Unevaluated costs, not subject to amortization     $   335,590
        Wells in progress                                      282,255
                                                           ------------
                   Total oil and gas properties                617,845
                                                           ------------
       Other property and equipment:
        Office equipment                                         1,337
        Less, accumulated depreciation                             (74)
                                                           ------------
                   Subtotal                                      1,263
                                                           ------------
         Total Property and Equipment, net                 $   619,108
                                                             =========

4.   Shareholders' Equity

     Preferred Stock The Company has authorized  10,000,000  shares of preferred
stock with a par value of $0.01 per share.  These shares may be issued in series
with such rights and preferences as may be determined by the Board of Directors.
Since inception, the Company has not issued any preferred shares.

     Common Stock The Company has authorized  100,000,000 shares of common stock
with a par value of $0.001 per share.

     Issued and  Outstanding  The total issued and  outstanding  common stock at
February 28, 2009 is 10,479,334 common shares, as follows:

     i.   Effective June 11, 2008, the Company issued 7,900,000 common shares to
          its founders at $0.001 per share, for aggregate proceeds of $7,900.

     ii.  Pursuant to a Private  Offering  Memorandum  dated June 20, 2008,  the
          Company sold 1,000,000  units at $1.00 per unit. Each unit consists of
          one share of  restricted  common  stock and one Series A warrant  that

                                       11
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

          entitles the holder to purchase one share of common stock at $6.00 per
          share through December 31, 2012.

     iii. Pursuant to a Private  Offering  Memorandum  dated July 16, 2008,  the
          Company sold 1,060,000 units at $1.50 per unit for total cash proceeds
          of  $1,590,000.  Each unit consists of one share of restricted  common
          stock and one Series A warrant  that  entitles  the holder to purchase
          one share of common  stock at $6.00 per  share  through  December  31,
          2012.

     iv.  Effective  September 10, 2008, the Company  agreed to issue  1,038,000
          common  shares to the  shareholders  of  Predecessor  Brishlin,  on an
          exchange  basis of one share of Synergy common stock for each share of
          Brishlin  common stock. In addition,  the  shareholders of Predecessor
          Brishlin  will receive  1,038,000  Series A warrants  that entitle the
          holder  to  purchase  one  share of  common  stock at $6.00  per share
          through December 31, 2012.

     v.   Effective December 1, 2008, the Company  repurchased  1,000,000 shares
          of its  common  stock  from one of the  original  Predecessor  Synergy
          shareholders for $1,000, the price at which the shares were originally
          sold to the shareholder.

     vi.  Pursuant to a Private Offering  Memorandum dated December 1, 2008, the
          Company sold 240,667  units at $3.00 per unit for total cash  proceeds
          of $722,001.  Offering costs  associated with the offering  aggregated
          $223,900,  resulting  in net cash  proceeds  of  $498,101.  Each  unit
          consists of two shares of common  stock,  one Series A warrant and one
          Series B  warrant.  Each  Series A  warrant  entitles  the  holder  to
          purchase one share of common stock at a price of $6.00 per share.  The
          Series A warrants  expire on  December  31,  2012,  or  earlier  under
          certain  conditions.  Each  Series B warrant  entitles  the  holder to
          purchase one share of common stock at a price of $10.00 per share. The
          Series B warrants  expire on  December  31,  2012,  or  earlier  under
          certain conditions.

     The following tables summarize  information  about the Company's issued and
outstanding common stock warrants for the period ended February 28, 2009:

                                               Remaining     Exercise Price
                                 Number of     Contractual    times Number
               Exercise Price     Shares     Life (in years)   of Shares
               --------------    ---------   --------------- --------------

                   $ 6.00        3,338,667          3.8        $20,032,000
                   $10.00          240,667          3.8        $ 2,406,670


                                       12
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)


                                              Number of    Weighted average
                                              warrants      exercise price
                                              ---------    ----------------

Outstanding, August 31, 2008                  2,043,571         $6.00
Granted                                       1,535,763         $6.63
Exercised                                            --            --
                                            ------------
Outstanding, February 28, 2009                3,579,334         $6.27
                                            ============

     5.   Stock Based Compensation

     The  Company  accounts  for stock  options  activities  as provided by SFAS
123(R),  "Share-Based  Payment,"  which  requires  the  Company  to  expense  as
compensation  the value of grants and options as determined  in accordance  with
the fair value based method prescribed in SFAS 123(R). The Company estimates the
fair   value  of  each   stock   option   at  the   grant   date  by  using  the
Black-Scholes-Merton option-pricing model.

     As described in the following paragraphs,  The Company recorded stock-based
compensation expense of $6,852,604 for the six months ended February 28, 2009.

     During June 2008,  stock options were granted to purchase  4,000,000 shares
of common stock.  Effective June 11, 2008, grants covering 2,000,000 shares were
issued to the  executive  officers at an exercise  price of $10.00 and a term of
five years,  and these options will vest over a one year period.  The fair value
of these options was determined to be nil based upon the following  assumptions:
expected  life of 2.5  years,  stock  price of $1.00 at date of  grant,  nominal
volatility, dividend yield of 0%, and interest rate of 2.63%. Effective June 30,
2008,  grants  covering  an  additional  2,000,000  shares  were  issued  to the
executive  officers at an exercise price of $1.00 and a term of five years,  and
these  options  will  vest  over a one  year  period.  Based  upon a fair  value
calculation, these options were determined to have a value of $127,000 using the
following assumptions:  expected life of 2.5 years, stock price of $1.00 at date
of grant, nominal volatility,  dividend yield of 0%, and interest rate of 2.63%.
Stock  option  compensation  expense of $59,280 was  allocated to the six months
ended  February  28,  2009,  based on a  pro-ration  of the fair  value over the
vesting period.

     In  connection  with the merger,  the Company  agreed to issue stock option
grants covering 4,000,000 shares to replace the similar options described in the
preceding paragraph.  Using the  Black-Scholes-Merton  option-pricing model, the
Company  estimated that the fair value of the replacement  options  exceeded the
fair value of the options  surrendered by $10,185,345.  The assumptions  used in
the model  were:  expected  life of 2.5 years,  stock  price of $3.50 at date of
grant, volatility of 166%, dividend yield of 0%, and interest rate of 2.63%. The
incremental  expense of $10,185,345 will be pro-rated over the remaining vesting
period.  For the six months ended  February 28, 2009,  the pro-rata stock option
compensation expense was $6,790,230.


                                       13
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

     Effective  December  31,  2008,  the Company  granted  stock  options to an
employee  to purchase  100,000  shares of common  stock at an exercise  price of
$3.00 and a term of ten years.  These options will vest over a five year period.
Based on a fair value calculation, these options were determined to have a value
of $185,640  using the following  assumptions:  expected life of 5 years,  stock
price of $2.00 at date of grant,  volatility of 166%,  dividend yield of 0%, and
interest rate of 3.13%. Stock option compensation expense of $3,094 was recorded
for the period ended February 28, 2009,  based on a pro-ration of the fair value
over the vesting period.

     The estimated unrecognized compensation cost from unvested stock options as
of February 28, 2009 was  approximately  $3,617,000,  substantially all of which
will be recognized during the current fiscal year.

     The  following  tables  summarize  information  about stock options for the
period ended February 28, 2009:

                              Remaining     Exercise      Weighted
                             Contractual   Price times    Average
                 Number of     Life (in     Number of     Exercise
Exercise Price    Shares        years)       Shares         Price
---------------------------------------------------------------------

    $10.00       2,000,000        4.6      $20,000,000      $10.00
    $ 1.00       2,000,000        4.6        2,000,000      $ 1.00
    $ 3.00         100,000        9.8          300,000      $ 3.00
                -----------                ------------
                 4,100,000                 $22,300,000      $ 5.44
                ===========                ============


                                   Number of      Weighted average
                                    shares         exercise price
                                   ---------      ----------------

Outstanding, August 31, 2008       4,000,000            $5.50
Granted                            4,100,000            $3.00
Terminated                        (4,000,000)           $5.50
                                 ------------
Outstanding, February 28, 2009     4,100,000            $5.44
                                 ============

Exercisable at February 28, 2009          --
2009                             ============



                                       14
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

6.   Related Party Transactions and Commitments

     The  Company's  executive  officers  control two entities that have entered
into agreements  with the Company.  The entities are Petroleum  Management,  LLC
("PM") and Petroleum  Exploration  and  Management,  LLC ("PEM").  One agreement
provides various administrative  services to the Company and the other agreement
provides an option to acquire certain oil and gas interests.

     For the six months ended February 28, 2009, the Company paid $120,000 under
the administrative services agreement.

     Effective  August 7, 2008, the Company entered into a letter of intent with
the related entities that provides an option to acquire working interests in oil
and gas leases  which are owned by PM and/or PEM.  The oil and gas leases  cover
640 acres in Weld County,  Colorado, and subject to certain conditions,  will be
transferred  to the  Company for  payment of $1,000 per net  mineral  acre.  The
working interests in the leases vary but the net revenue interest in the leases,
if acquired by the Company,  will not be less than 75%. The letter of intent, as
amended, has an expiration date of August 31, 2009.

     On June 11, 2008, the Company entered into two year  employment  agreements
with its  executive  officers.  Pursuant to the terms of those  agreements,  the
salaries of William E. Scaff,  Jr. and Ed Holloway  are each  $12,500 per month.
For the six months  ended  February 28, 2009,  the Company paid  $150,000  under
these agreements.

     In June 2008, the Company sold 1,900,000  shares of its common stock to the
Synergy  Energy  Trust (the  "Trust").  The Trust was created for the benefit of
consultants and others who have, or will in the future, benefit the Company. The
trustee is a shareholder of the Company. Effective December 1, 2008, the Company
repurchased  1,000,000 shares of its common stock from the Trust for $1,000, the
original selling price. As of April 3, 2009, the Trust had not sold, assigned or
transferred any of the Company's remaining 900,000 shares.

     On June 1, 2008, the Company  entered into an agreement with Energy Capital
Advisors,  an entity related through common ownership interests.  Energy Capital
Advisors will provide certain services  directly  related to raising  additional
capital for the Company.  The agreement will  terminate on May 31, 2009,  unless
terminated  earlier  for  reason  of  non-performance.  Compensation  under  the
agreement was $30,000 per month through  December 31, 2008,  and will be $10,000
per month from  January  1, 2009 to May 31,  2009.  During the six months  ended
February 28, 2009, the Company paid $140,000 related to this agreement.

     On June 1, 2008, the Company  entered into an agreement with J3 Energy LLC,
an entity related through common ownership interests. Pursuant to the Agreement,
J3 Energy LLC agreed to provide  certain  services  directly  related to raising
additional  capital for the Company.  The agreement  terminated on September 30,
2008.  Compensation  under the  agreement  was $8,000 per month.  During the six


                                       15
<PAGE>

                         SYNERGY RESOURCES CORPORATION
                         (An Exploration Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                               February 28, 2009
                                  (Unaudited)

months  ended  February  28,  2009,  the  Company  paid  $8,000  related  to the
agreement.

     In connection  with the merger,  the Company entered into an agreement with
two directors to provide consulting services.  The initial term of the agreement
is one year.  Compensation under the agreement is $10,000 per month.  During the
six months  ended  February  28,  2009,  the Company  recorded  costs of $60,000
related to this agreement.




                                       16
<PAGE>


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

Overview

     The following  discussion updates our plan of operation for the next twelve
months.  It also  analyzes  our  financial  condition  at February  28, 2009 and
compares  it to our  financial  condition  at  August  31,  2008.  Finally,  the
discussion summarizes the results of our operations for the three months and six
months ended February 28, 2009.  This  discussion and analysis should be read in
conjunction  with our audited  financial  statements for the period ended August
31, 2008,  including footnotes thereto, and the discussion and analysis included
in our reports as filed with the SEC.

Merger  Transaction  Between  Brishlin  Resources,  Inc.  and Synergy  Resources
Corporation

     Synergy Resources Corporation represents the result of a merger transaction
between Brishlin Resources, Inc. ("Predecessor Brishlin"), a public company, and
Synergy Resources  Corporation  ("Predecessor  Synergy"),  a private company. In
conjunction  with the  transaction,  Predecessor  Brishlin  changed  its name to
Synergy  Resources  Corporation  and  Predecessor  Synergy  changed  its name to
Synergy Resources, Ltd.

     On September 10, 2008,  Predecessor  Brishlin  consummated  an Agreement to
Exchange  Common  Stock  ("Exchange  Agreement")  with certain  shareholders  of
Predecessor Synergy to acquire approximately 89% of the outstanding common stock
of  Predecessor  Synergy.  In  subsequent  transactions,  all of  the  remaining
outstanding  common  shares  of  Predecessor  Synergy  were  acquired.  Prior to
September 10, 2008, Predecessor Brishlin had 1,038,000 common shares outstanding
and  Predecessor  Synergy had 9,960,000  common shares  outstanding.  The merger
transaction  resulted in an entity with 10,998,000 shares outstanding,  with the
shareholders of Predecessor Synergy holding approximately 91% of the outstanding
shares and the shareholders of Predecessor Brishlin holding  approximately 9% of
the outstanding shares.

     As additional  consideration  in the  transaction,  the Exchange  Agreement
required  Predecessor  Brishlin to issue 2,060,000  Series A warrants to certain
shareholders  of  Predecessor  Synergy to replace  similar  warrants  previously
issued by  Predecessor  Synergy.  Each Series A warrant  entitles  the holder to
purchase one share of common stock at an exercise price of $6.00 per share.

     Although  the legal form of the  transaction  reflects the  acquisition  of
Predecessor Synergy by Predecessor  Brishlin,  we determined that the accounting
form of the transaction is a "reverse merger",  in which Predecessor  Synergy is
identified as the acquiring  company and  Predecessor  Brishlin is identified as
the acquired company. Furthermore, since Predecessor Brishlin had ceased most of
its  activities  as of the merger  date,  the  transaction  was not treated as a
business combination pursuant to Statement of Financial Accounting Standards No.
141, but as a capital  transaction  whereby  common stock was issued for the net
assets of Predecessor Brishlin accompanied by a simultaneous recapitalization of
Predecessor Synergy. No goodwill or other intangible assets were recorded in the
transaction.


                                       17
<PAGE>

     Financial  information  for all periods  subsequent  to September  10, 2008
includes the combined  assets,  liabilities  and  activities of both  companies.
Historical  financial  information  for periods  prior to  September  10,  2008,
presented for comparative purposes, includes only Predecessor Synergy.

     At the date of the Exchange Agreement,  Predecessor Synergy's primary asset
was approximately $2,200,000 in cash that it had raised from sales of its common
stock to private investors. Predecessor Brishlin's primary asset was an interest
in one shut-in well located in northeastern Colorado.

Plan of Operation

     We plan to become an  independent  oil and gas  exploration  and production
company, engaged in the acquisition of mineral interests and the exploration and
development of crude oil and natural gas reserves and production.  Our executive
officers have  extensive  experience in drilling wells and producing oil and gas
in the Denver-Julesburg  Basin (D-J Basin) located in northeastern  Colorado and
neighboring states. The D-J Basin has many positive attributes that we intend to
exploit.  The area has a long history of successful oil and gas operations,  and
features low drilling and completion costs, high level of predictability,  rapid
return on  investment,  and numerous  drilling  opportunities.  New drilling and
completion  technology has greatly improved the ability to extract  hydrocarbons
from mineral  rich  formations.  We have  developed a plan to utilize a drilling
program in proven  areas  with a  relatively  predictable  return and a low risk
history.

     As an oil and gas  company,  our  strategy  will be to identify and exploit
mineral interests in areas that are proximate to existing or indicated producing
areas based on the results of other drilling activity in the area. These targets
can be quickly  developed  and put into  production as low cost and low risk. We
believe that the  experience of our  executive  officers will provide us with an
advantage in quickly acquiring  prospects in promising areas in an efficient and
cost effective manner.

     To fund our  operations,  we plan to sell  additional  shares of our common
stock and warrants.

     We have an option to  acquire  interests  in mineral  properties  currently
owned  by  Petroleum  Management,  LLC  ("PM")  and  Petroleum  Exploration  and
Management, LLC ("PEM"), companies controlled by our executive officers. The two
entities have acquired the rights to several  mineral  interests and have agreed
to assign  certain  interests to us for payment of $1,000 per mineral acre.  The
option  required an initial  payment of $100,000,  which will be applied against
the leases we acquire.



                                       18
<PAGE>

     Pursuant  to the  option  agreement  with PM and PEM  described  above,  we
recently  participated  in two wells drilled by Kerr-McGee  Oil & Gas Onshore LP
("KM"). Both the Gray #25-16 well and the Zabka State #33-15 well hit productive
formations  at a depth of  approximately  7,500 feet. As of March 31, 2009 these
wells were in the completion  stage. We have a 37.5% working  interest  (28.125%
net revenue  interest) in each well and expect that our  proportionate  share of
drilling and completing these wells will approximate $570,000.

     In  November,  2008,  we  participated  in an auction of oil and gas leases
conducted  by the State of Colorado.  We were awarded  leases to 1,600 acres for
total  consideration  of  $113,600.  The leases  have a term of five  years.  In
February,  2009, we participated in an auction of leases conducted by the Bureau
of  Land   Management.   We  were  awarded  leases  to  2,000  acres  for  total
consideration of $45,000.  The leases have a term of ten years. In addition,  we
acquired several leases in private transactions.  The leases cover approximately
3,000  acres for total  consideration  approximating  $136,000.  The leases have
terms ranging from two to five years.  As of March 31, 2009, we had interests in
approximately 6,700 net acres, none of which were included in the full cost pool
subject to amortization.

Exploration  Stage Company.  We are considered an exploration  stage company for
accounting  purposes.  We are unable to predict with any degree of accuracy when
that  classification  will change. We expect to incur losses until such time, if
ever, we begin generating significant revenue from operations.

Going Concern.  The report of our independent  registered public accounting firm
on  our  audited  financial  statements  as of  August  31,  2008  contained  an
explanatory  paragraph expressing  significant  uncertainty about our ability to
continue as a going  concern.  The factors that  contribute to this  uncertainty
include  our  status  as  an  exploration  stage  company,  our  need  to  raise
significant  additional  capital to fund our business  plan,  and the  operating
losses that we have incurred since inception.

Liquidity and Capital Resources

     Our business will be capital  intensive.  Our primary cash needs will be to
fund operating  expenses and capital  expenditures  related to the  acquisition,
exploration and development of crude oil and natural gas properties. Our ability
to execute our plan is dependent upon a number of factors,  including the amount
of capital that is raised in the coming months.

     We plan to  obtain  more  funding  in the next 12 months  to  continue  our
business operations.


                                       19
<PAGE>

     We do not currently  have access to a working  capital line of credit,  but
may try to obtain one in the future.  During the last several months, the credit
markets have undergone significant volatility.  Many financial institutions have
liquidity concerns,  prompting  government  intervention to mitigate pressure on
the credit markets.  These  disruptions may affect our ability to obtain capital
resources and to finance our operations.  Due to the uncertainty in the credits,
we are  unable to predict  if we will be able to obtain  financing  on terms and
conditions that are acceptable to us.

     The  most  significant  of our  future  expenditures  include  (i)  capital
expenditures   estimated  at   approximately   $2,700,000  for  exploration  and
development;  (ii)  approximately  $100,000  per month for  operating  expenses,
including salaries and other corporate overhead; and (iii) approximately $10,000
per month under a consulting agreement for capital formation services.

     All of our capital resources to date have been provided exclusively through
the sale of equity  securities.  From  inception  through  February 28, 2009, we
received cash proceeds of $3,319,900  from the sale of our common stock,  offset
by the payment of offering  costs of $357,900  and the  repurchase  of 1,000,000
shares of common stock from the original shareholder for $1,000.

     Cash and cash  equivalents.  As of February 28, 2009,  we had cash and cash
equivalents  on hand of  $1,800,890.  From time to time,  our cash  balances may
exceed the limits of federal deposit insurance. We attempt to limit this risk by
maintaining our cash deposits in a financial  institution which we believe to be
financially strong.

     Working  capital.  As of  February  28,  2009,  we had  working  capital of
$1,548,024, comprised of current assets of $1,842,359 and current liabilities of
$294,335.  Our working  capital  declined by $718,403  from the working  capital
balance of $2,266,427 as of August 31, 2008,  primarily as a result of cash used
in our operations and the acquisition of oil and gas properties.

     Operating activities.  Net cash used in operating activities during the six
months ended February 28, 2008 was $384,776. Cash was primarily used to fund our
operating expenses.

     Investing  activities.  During the six months ended  February 28, 2009,  we
used $636,070 in investing activities,  primarily consisting of expenditures for
the acquisition of oil and gas properties and leases.

     Financing activities.  Cash provided by financing activities during the six
months ended  February 28, 2009 was  $529,395,  consisting  of proceeds from the
sale of common  stock of  $774,295  offset by  offering  costs of  $243,900  and
repurchase of shares for $1,000.

     Off Balance Sheet Financing.  As of and subsequent to February 28, 2009, we
did not have  any  arrangements  that are  considered  to be  off-balance  sheet
financing.


                                       20
<PAGE>

     It is  expected  that the  principal  source  of cash flow will be from the
production  and sale of crude oil and natural gas reserves  which are  depleting
assets.  Cash  flow  from the sale of oil and gas  production  depends  upon the
quantity of production and the price obtained for the production. An increase in
prices will permit us to finance  operations to a greater extent with internally
generated  funds,  may allow us to obtain  equity  financing  more  easily or on
better terms,  and lessens the difficulty of obtaining debt financing.  However,
price increases heighten the competition for oil and gas prospects, increase the
costs of exploration and development,  and, because of potential price declines,
increase the risks associated with the purchase of producing  properties  during
times that prices are at higher levels.

     A decline in oil and gas prices  (i) will  reduce the cash flow  internally
generated,  which in turn will reduce the funds  available for exploring for and
replacing oil and gas reserves,  (ii) will increase the  difficulty of obtaining
equity and debt  financing  and worsen the terms on which such  financing may be
obtained,  (iii)  will  reduce the  number of oil and gas  prospects  which have
reasonable  economic  terms,  (iv) may cause us to permit leases to expire based
upon the value of  potential  oil and gas  reserves  in relation to the costs of
exploration,  (v) may result in  marginally  productive  oil and gas wells being
abandoned as  non-commercial,  and (vi) may increase the difficulty of obtaining
financing.  However,  price  declines  reduce  the  competition  for oil and gas
properties and correspondingly reduce the prices paid for leases and prospects.

     It is our plan to generate profits by drilling productive oil or gas wells.
However, we will need to raise the funds required to drill new wells through the
sale of equity securities,  from loans from third parties, or from third parties
willing to pay our share of drilling and well  completion  costs. We do not have
any  commitments  or  arrangements  from  any  person  to  provide  us with  any
additional capital. If additional financing is not available when needed, we may
need to curtail or cease  operations.  We may not be  successful  in raising the
capital needed to drill oil or gas wells. Any wells which may be drilled may not
be productive of oil or gas.

Results of Operations

     We are in the early stages of implementing our business plan. For financial
reporting  purposes,  our  inception  date was December  28, 2007,  the day that
Predecessor  Synergy  was  incorporated  in the State of  Colorado.  Although we
incorporated in 2007, we did not commence business  activities until June, 2008.
Accordingly, this discussion does not address historical comparative amounts for
periods prior to June, 2008.

Three Months Ended February 28, 2009

     For the three  months ended  February  28, 2009,  we recorded a net loss of
$(3,718,032),  or $(0.36)  per share.  We did not report any sales of oil or gas
during the period.

     Operating  expenses  for the three  months  ended  February  28,  2009 were
$3,722,211,  most of which was share based  compensation.  Excluding share based
compensation,  operating  expenses  for the quarter  were  $294,362,  consisting
primarily  of  salaries  and  benefits,  amounts  paid under the  administrative
services  arrangement with PM, consulting and professional fees. These costs may


                                       21
<PAGE>

increase in future  periods as we  implement  our  business  plan and expand our
business activities.

     Operating expenses include  $3,427,849 of share based compensation  related
to the issuance of stock  options.  When stock  options are issued,  we estimate
their  fair  value  using the  Black-Scholes-Merton  option-pricing  model.  The
estimated  fair value is  recorded  as an  expense on a pro-rata  basis over the
vesting  period.  In  connection  with the  merger,  we agreed to issue  options
covering  4,000,000  shares to replace  similar options that had previously been
issued. We estimate that the fair value of the replacement  options exceeded the
fair value of the surrendered  options by $10,185,345  and the relevant  vesting
period is nine months. The pro-rata expense amount allocated to this quarter was
$3,395,115  and  the  remaining   amount  to  recognize  in  future  periods  is
$3,395,115. Other options have been issued which increased total expense for the
quarter to $3,427,849.

Six Months Ended February 28, 2009

     For the six months  ended  February  28,  2009,  we  recorded a net loss of
$(7,432,968),  or $(0.70)  per share.  We did not report any sales of oil or gas
during the period.

     Operating  expenses  for  the six  months  ended  February  28,  2009  were
$7,444,610,  most of which was share based  compensation.  Excluding share based
compensation,  operating  expenses for the six months were $592,006,  consisting
primarily  of  salaries  and  benefits,  amounts  paid under the  administrative
services  arrangement with PM, consulting and professional fees. These costs may
increase in future  periods as we  implement  our  business  plan and expand our
business activities.

     Operating expenses include  $6,852,604 of share based compensation  related
to the issuance of stock  options.  When stock  options are issued,  we estimate
their  fair  value  using the  Black-Scholes-Merton  option-pricing  model.  The
estimated  fair value is  recorded  as an  expense on a pro-rata  basis over the
vesting  period.  In  connection  with the  merger,  we agreed to issue  options
covering  4,000,000  shares to replace  similar options that had previously been
issued. We estimate that the fair value of the replacement  options exceeded the
fair value of the surrendered  options by $10,185,345  and the relevant  vesting
period is nine months.  The pro-rata  expense amount allocated to this six month
period was $6,790,230 and the remaining amount to recognize in future periods is
$3,395,115. Other options have been issued which increased total expense for the
quarter to $6,852,604.

Outlook

     The factors that will most  significantly  affect our results of operations
will be (i) the sale  prices of crude oil and  natural  gas,  (ii) the amount of
production  from oil or gas  wells in which we have an  interest,  and (iii) and
lease operating  expenses.  Our revenues will also be significantly  impacted by
our ability to maintain or increase oil or gas  production  through  exploration
and development activities.


                                       22
<PAGE>

     Other than the foregoing, management does not know of any trends, events or
uncertainties  that will have had or are reasonably  expected to have a material
impact on sales, revenues or expenses.

Forward-Looking Statements

     This Form 10-Q  contains  or  incorporates  by  reference  "forward-looking
statements,"  as that  term  is  used in  federal  securities  laws,  about  our
financial  condition,  results of  operations  and  business.  These  statements
include, among others:

     -    statements concerning the benefits that we expect will result from our
          business  activities and results of exploration that we contemplate or
          have completed, such as increased revenues; and

     -    statements of our expectations,  beliefs, future plans and strategies,
          anticipated  developments  and other  matters that are not  historical
          facts.

     These  statements  may  be  made  expressly  in  this  document  or  may be
incorporated by reference to other documents that we will file with the SEC. You
can find many of these  statements  by  looking  for words  such as  "believes,"
"expects," "anticipates," "estimates" or similar expressions used in this report
or incorporated by reference in this report.

     These forward-looking statements are subject to numerous assumptions, risks
and uncertainties  that may cause our actual results to be materially  different
from any future results  expressed or implied in those  statements.  Because the
statements  are subject to risks and  uncertainties,  actual  results may differ
materially  from those  expressed  or  implied.  We caution you not to put undue
reliance on these  statements,  which speak only as of the date of this  report.
Further,  the information  contained in this document or incorporated  herein by
reference is a statement of our present  intention and is based on present facts
and assumptions, and may change at any time and without notice, based on changes
in such facts or assumptions.

Risk Factors Impacting Forward-Looking Statements

     The important factors that could prevent us from achieving our stated goals
and objectives include, but are not limited to, those set forth in our Form 10-K
filed with the SEC and the following:

     o    The worldwide economic situation;
     o    Volatility in the price of oil and gas;
     o    Any change in interest rates or inflation;
     o    The   willingness   and  ability  of  third  parties  to  honor  their
          contractual commitments;
     o    Our  ability to raise  additional  capital,  as it may be  affected by
          current  conditions in the stock market and competition in the oil and
          gas industry for risk capital;
     o    Our capital costs, as they may be affected by delays or cost overruns;
     o    Our costs of production;


                                       23
<PAGE>

     o    Environmental and other  regulations,  as the same presently exist and
          may hereafter be amended;
     o    Our ability to identify, finance and integrate other acquisitions; and
     o    Volatility of our stock price.

     We undertake no  responsibility  or  obligation  to update  publicly  these
forward-looking  statements,  but may do so in the  future  in  written  or oral
statements.  Investors  should take note of any future  statements made by or on
our behalf.

Item 4. Controls and Procedures.

     (a) We maintain a system of controls and procedures designed to ensure that
information  required to be  disclosed  by us in reports  that we file or submit
under the Securities Exchange Act of 1934, as amended ("1934 Act"), is recorded,
processed,  summarized and reported,  within time periods specified in the SEC's
rules and forms and to ensure that information required to be disclosed by us in
the  reports  that we file or  submit  under the 1934 Act,  is  accumulated  and
communicated to our management,  including our Principal  Executive  Officer and
Principal  Financial Officer, as appropriate to allow timely decisions regarding
required disclosure. As of February 28, 2009, under the supervision and with the
participation  of  our  Principal  Executive  Officer  and  Principal  Financial
Officer,  management has evaluated the effectiveness of the design and operation
of our  disclosure  controls  and  procedures.  Based  on that  evaluation,  the
Principal  Executive Officer and Principal  Financial Officer concluded that our
disclosure controls and procedures were effective.

     (b) Changes in  Internal  Controls.  There were no changes in our  internal
control over  financial  reporting  during the quarter ended  February 28, 2009,
that materially  affected,  or are reasonably likely to materially  affect,  our
internal control over financial reporting.




                                       24
<PAGE>

                                     PART II

Item 1. Legal Proceedings.

     None.

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

     During the three months ended  February 28, 2009,  we sold 240,667 units at
$3.00 per unit for gross cash  proceeds of  $722,001.  The units  consist of two
shares of our common stock, one Series A Warrant and one Series B Warrant.

     Each  Series A Warrant  entitles  the holder to  purchase  one share of the
Company's  common  stock at a price of $6.00 per  share.  The  Series A Warrants
expire on the earlier of December  31,  2012 or twenty  days  following  written
notification  from the Company  that its common stock had a closing bid price at
or above $7.00 for any ten of twenty consecutive trading days.

     Each  Series B Warrant  entitles  the holder to  purchase  one share of the
Company's  common  stock at a price of $10.00 per  share.  The Series B Warrants
expire on the earlier of December  31,  2012 or twenty  days  following  written
notification  from the Company  that its common stock had a closing bid price at
or above $12.00 for any ten of twenty consecutive trading days.

     Neither the shares nor the warrants were  registered  under the  Securities
Act of 1933,  as  amended  (which we refer to as the "Act") and we relied on the
exemption  from  registration   provided  by  Section  4(2)  of  the  Act.  Each
certificate representing the shares issued in the transaction was stamped with a
legend indicating that the shares  represented by the certificate are restricted
securities,  as that term is defined in Rule 144 of the  Securities and Exchange
Commission.

Item 3. Default Upon Senior Securities.

     None.

Item 4. Submission of Matters to a Vote of Securities Holders.

     None.

Item 5. Other Information.

     None.



                                       25
<PAGE>


Item 6.  Exhibits

a.  Exhibits

      31.1     Certification pursuant to Section 302 of the Sarbanes-Oxley Act
               of 2002 for Edward Holloway.

      31.2     Certification pursuant to Section 302 of the Sarbanes-Oxley Act
               of 2002 for Frank L. Jennings.

      32       Certification pursuant to Section 906 of the Sarbanes-Oxley Act
               of 2002 for Edward Holloway and Frank L. Jennings.



                                       26
<PAGE>

                                   SIGNATURES

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.




                                     SYNERGY RESOURCES CORPORATION

Date:  April 3, 2009
                                     By:   /s/ Ed Holloway
                                          -----------------------------------
                                          Ed Holloway, President and Principal
                                          Executive Officer



Date:  April 3, 2009
                                     By:  /s/ Frank L. Jennings
                                          -----------------------------------
                                          Frank L. Jennings, Principal Financial
                                          and Accounting Officer