SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-K

                 Annual Report Under Section 13 or 15(d) of the

                         SECURITIES EXCHANGE ACT OF 1934

            [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                              For Fiscal Year Ended
                                December 31, 2000

                            Commission File #0-30503

                          PANGEA PETROLEUM CORPORATION
             (Exact name of registrant as specified in its charter)

                                    Colorado

         (State or other jurisdiction of incorporation or organization)

                                   76-0635938
                      (IRS Employer Identification Number)

             6776 Southwest Freeway, Suite 620, Houston, Texas 77074
               (Address of principal executive offices )(Zip Code)

                                 (832) 242-3381
                (Registrant's telephone no., including area code)

(Former name, former address and former fiscal year, if changed since last
report)

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

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

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

Yes   [X]     No [   ]


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Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B not contained in this form, and no disclosure will be contained,
to the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. ( )

Revenues for year ended December 31, 2000: $-0-

Aggregate market value of the voting common stock held by non-affiliates of the
registrant as of April 10, 2001, was: $21,086,954

Number of shares of the registrant's common stock outstanding as of April 10,
2001 was: 47,370,898

Transfer Agent as of April 10, 2001:

                     Olde Monmouth Stock Transfer Co., Inc.
                         77 Memorial Parkway, Suite 101
                      Atlantic Highlands, New Jersey 07716


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                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

General

About Pangea

Pangea Petroleum Corporation is a publicly traded company listed on the OTC
Electronic Bulletin Board under the symbol "PAPO." We are largely an independent
energy company engaged, through our wholly owned subsidiary, Mass Energy, Inc.
in an active exploration and drilling program as well as the purchase,
re-engineering, exploitation and development of proven oil and gas properties as
a core business activity. The Officers and Directors of the Company are familiar
with and understand the petroleum business. The Company structure will remain
small through the use of carefully selected consultants, contractors and service
companies.

Pangea will use capital and established proven technology to create value by
generating significant production from established reserves that are of little
interest to the major companies in the industry. Initially, the Company will
focus on mature petroleum provinces in the United States that have adequate
production and distribution infrastructures. In most cases, the Company will
invest in projects to a sufficient degree to maintain decision-making control
while leaving routine operating responsibility in the hands of competent
partners and/or contractors. The Company will market its products through a mix
of short and long term contracts to assure a reliable revenue stream and hedge
marketing to flatten the swings in energy prices. Producing properties may be
resold after enhanced production is established as appropriate to establish and
maintain maximum asset value.

Pangea Petroleum Organization. We are a Colorado corporation incorporated on
March 11, 1997 under the name Zip Top, Inc. On December 11, 1998, we changed our
name to Pangea Petroleum Corporation. Until our acquisition of Mass Energy, Inc.
in October 2000, we operated as a development stage company. Our main office
(which we share with our wholly owned subsidiary, Mass Energy, Inc.) is located
in Harris County, Texas, at 6776 SW Freeway, Suite 620, Houston, Texas 77074. We
maintain all business functions in the Houston area. Primary corporate functions
include business support, financial control, technology, production and
technical support.

The group working with the financial control function will identify capital
resources required to support our strategic goals. This office will also be
responsible for human resources, planning, and other ordinary company functions.
The financial control department will report to the Chairman and will control
all of our finances and coordinate with corporate financial control. The
department will be responsible for payables, receivables and financial planning.
Technology is responsible for identifying and qualifying products, services, and
systems


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required to support the petroleum production business. It will take the lead in
selecting and qualifying contractors, consultants, and service companies
required for the implementation of the Company's business plan. Finally, it will
stay abreast of technology changes on the outside that will impact Pangea.

The Production Department will control the production of petroleum products. It
will work with partners and contractors to ensure optimum production at all
times. Production will also take the lead in marketing all produced products.
Technical support will be responsible for initial start up of new projects in
conjunction with technology and production. It will serve in a coordinating role
on all projects. Additionally, it will be the primary interface between service
providers and the rest of the Company. It will approve all production plans and
monitor implementation.

Revenue Model. Revenue potential and asset enhancement will be the guiding
principal for all our investments. Projects will be selected and developed in a
manner that will minimize capital required and maximize the utilization of
existing production and collection infrastructure and geologic data. We will try
to minimize risk by producing from known reserves first and then producing from
other reserves made available by work-overs and other established techniques.
Revenue streams from product sales will be enhanced by the careful selection and
priorization of projects based on the above listed criteria.

Pangea intends to become a significant industry player by capturing a
disproportion share of available revenue from key energy investments and
maintain financial strength by developing a strategic mix of saleable products
(oil and natural gas) that are marketed in a manner to minimize the fluctuations
common to the energy marketplace. The planned mix of investments will support a
predictable, growing revenue stream from product sales and augmented by income
from the sale of enhanced productive properties.

The key financial assumption in our business plan is that a significant number
of attractive energy investments will continue to be available for purchase and
appropriate technology will be available through service companies and
consultants to develop these properties.

Pangea will create value in three ways. First of all, we will develop a market
leading position in the identification and exploitation of under-producing oil
and gas reserves in established energy provinces such as the State of Texas.
Using a judicial mix of current, proven technology and capital, Pangea will
optimize production from established reserves. First-rate service companies that
have been selected from an approved group of merit-based companies will
implement approved projects. Revenue streams will be maximized by carefully
marketing the products through a combination of spot and contract sales and in
some cases product sales will be hedged.

The second major thrust for value creation will be the enhanced asset value
realized from the development of the under-utilized reserves acquired by
purchase. These reserves can


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frequently be produced for a number of years and then re-sold in the market
place for greater value because of enhanced production and timing.

The final thrust will be the formation of strategic alliances and partnerships
that will enable Pangea to play a greater role in the development of older
reserves than it could achieve on its own. These partnerships might take the
form of jointly owned reserves, production sharing agreements with service
companies in return for production guarantees, or some combination of these and
other shared business arrangements.

Pangea's organization will fully utilize strategic marketing to fully implement
its business plan. We will select a strategic marketing consultant to guide us
through this process.

Pangea intends to become a significant participant in select market niches in
the energy industry. The niches include the development of under producing oil
and natural gas reserves with capital and technology, the resale of improved and
re-packaged producing properties and participation in the final production stage
and disposition of select offshore projects. We will create value for our
shareholders by leading the market in our niches and maintaining a strong
financial base. We will use strategic marketing to stay ahead of the curve in
our industry.

Industry. The petroleum industry is a global industry that is fundamental to all
economic activity. It is composed of the down stream sector (refining,
marketing, products and derivatives) and the upstream sector that is focused on
finding and producing crude oil and natural gas. Oil and natural gas are
commodities that are found throughout the world and they have been produced in
increasing quantities since the mid 19th century. The exploration, production
and transportation of these materials in the modern era generate an enormous
appetite for capital because quantities sufficient to fuel the world's economic
machine are rapidly becoming more difficult to find and expensive to produce.
Consequently, a few global corporations and state energy companies dominate the
industry. These companies tend to concentrate their investments on very large
prospects and to quickly abandon less productive, older reserves.

The production technology in the petroleum industry has improved tremendously in
recent years, however commercial quantities of oil and gas are frequently left
in place when fields are abandoned. This fact is particularly true in older
reservoirs that were abandoned before modern technologies were available.

Additionally, the economic level of interest varies with company size. A small
company such as Pangea is frequently willing to devote resources to a field that
is not of interest to a major oil and gas company.

Our prospect in Starr County is an excellent example of a prospect that would
not be attractive to a major oil and gas company but would be very attractive
financially to a

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company of our size with the use of new production technology and
infrastructure. When the exploratory oil wells in our Starr County prospect blew
out in 1939 and were tested as gas wells, they were abandoned because of a lack
of infrastructure and an economic market demand. Now, nearby gas pipelines as
well as a ready market make this prospect attractive to us as well as others.

Mature energy provinces such as the United States have many productive fields
with production and collection infrastructure in place that can be purchased.
The infrastructure represents a significant required investment if production is
to continue. These fields offer investment potential for those companies willing
to commit capital and appropriate technology. The technology is readily
available from consultants, service companies, and other groups established to
support the petroleum production sector.

This plan will target the petroleum niche composed of fields with established
reserves that require capital and/or technology in order to enhance or restore
production.

About Mass Energy

Mass Energy, Inc., our wholly owned subsidiary since October 2000 is a Texas
corporation organized on November 24, 1997. Mass Energy engages in an active
exploration and drilling program as well as the purchase, re-engineering,
exploitation and development of proven oil and gas properties as a core business
activity in Texas and California. In addition to these states, it previously
operated in Louisiana.

Mass Energy's main office is located in Harris County, Texas, at 6776 SW
Freeway, Suite 620, Houston, Texas 77074. M&R Exploration Company and Mass
Energy, Inc., both Texas business corporations, merged effective November 1,
1997. The plan of merger was adopted in accordance with the Texas Business
Corporations Act. Under the terms of the merger, M&R Exploration Company was the
surviving corporation. The plan of merger provided for the change of the
corporate name to Mass Energy, Inc. Mass Energy currently has active leases in
Texas (Shelby County, Starr County and Jackson County) and California (Kern
County). Mass Energy has drilled wells in Shelby and Starr Counties in Texas and
is drilling wells in Jackson County, Texas. Mass Energy is currently assessing
the wells in Kern County, California. Mass Energy anticipates drilling to
commence in the second quarter of 2001.

Primary Operating Areas
Leases

Shelby County, Texas
Flat Fork Prospect

The Shelby County Leases cover 2,387.672 acres and 6,541.211 acres, both located
in Shelby County, Texas and are called the Flat Fork Prospect. The Company owns
a 50%


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operated working interest position in approximately 8929 gross acres of oil and
gas leases located in Shelby County, Texas. An initial test well was drilled in
the easternmost portion of this acreage in January 2000. This well was drilled
underbalanced with dual stacked horizontal laterals for a total measured depth
of approximately 17,000 feet. The well was tested at 3-5 million cubic feet of
gas per day and approximately 130 barrels of saltwater per hour. This well
should have been extremely profitable, but because of the expense involved to
haul the saltwater from location, the well is uneconomical. On the westernmost
portion of this acreage, the James Lime Formation has been economically produced
without significant amounts of saltwater production. The Company is currently
evaluating the possibility of drilling an additional well in this area.

Starr County, Texas
La Brisa Ranch Prospect

The Starr County Leases cover 1,268.73 acres and 589 acres, both located in
Starr County, Texas. They are both covered by and Assignment, Bill of Sale and
Conveyance ("Assignment"). The Assignment for the lease for 1,268.73 acres
covers an undivided 84.875% leasehold interest at a 63.65625% Net Revenue
Interest. Such lease includes 2 tracts of land, 1,100.73 acres and 168 acres.
The Assignment for the lease for 589 acres covers an undivided 63.65625%
leasehold interest at a 47.7421875% Net Revenue Interest. Such lease is for 1
tract of land.

The Company currently owns 75% operated working interest in oil and gas leases
in the La Brisa Ranch prospect, located in Starr County, Texas. Approximately
1,858 acres are now under lease; being two leases for 1268.73 acres and 589
acres. In October 2000, in the southern portion of this acreage, the Company
drilled a 7000 feet test (Garnett #1 Well) which offset a well drilled in 1926
that blew out in the 5400 feet Sand. The well was tested and found to be
uncommercial. Approximately 50 square miles of 3-D data was shot encompassing
the northern portion of our acreage position. The Company has identified,
through sub-surface control, a prospective drilling location, but will solicit
3-D interpretation to confirm this prospect. The Company intends to drill this
prospect in the second or third quarter of 2001.

Jackson County, Texas
SW El Toro 3-D Prospect

The Jackson County Leases cover 425 acres and 158.10 acres, both located in
Jackson County, Texas. The 425 acre lease is a Farmout Agreement which requires
a $150,000 payment in 3 installments due November 18, 2000, December 18, 2000
and the date the well is spudded. The 158.10 acre lease is an Oil, Gas and
Mineral Lease executed November 16, 2000.


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The Company currently owns 100% operated working interest in 425 acres in the
deep mineral rights acquired in a farm-out agreement with White Oak Energy, et.
al. The Company owns 100% in this prospect AMI (area of mutual interest) with
White Oak Energy, et. al. Retaining a 15% back-in position on the first two
wells drilled. Additional oil and gas leases, being approximately 371 gross
acres were acquired adjacent to our prospect area. Approximately 80 square miles
of 3-D was shot by an independent contractor, which included our acreage. This
prospect was generated through 3-D Seismic interpretation by the Keljor Group. A
test well (Vincik #3 Well) was spud on January 18, 2001. We have completed
drilling on this well. It will be perforated in the 6500' Frio Sand during the
week of April 2, 2001. If successful, production of oil will begin immediately
into temporary tanks, with the construction of a permanent production facility
to follow within two weeks.

Kern County, California
35X Anticline Prospect

The Kern County Lease covers 2,252 acres located in Kern County, California.
This lease is covered by an Assignment of Oil and Gas Leases executed December
15, 2000 by Mass Energy and Samedan Oil Corporation and covers 7 leases. The
Company currently owns 75% operated working interest in approximately 2252 gross
acres located in Kern Country, California. This acreage was acquired by Mass
Energy from Samedan Oil Corporation, and covers seven leases. Plans are to drill
an underbalanced horizontal single-lateral well in the Antelope Shale formation
at approximately 4450 feet with a lateral length of 2500 feet. This well should
spud in the second quarter of 2001.

The Republic of Guinea Project

In March 2000, we signed a letter of intent with US Oil to acquire the rights to
a refinery project in The Republic of Guinea. We were going to form a new
entity, Pangea International, to operate such project. After signing the letter
of intent, the social and political climate in The Republic of Guinea became
non-conducive to business opportunities. We are still very interested in
pursuing this opportunity once the political climate stabilizes.

Business Strategy

Our business strategy includes an active exploration and drilling program as
well as the purchase, re-engineering, exploitation and development of proved oil
and gas properties as a core business activity. Our strategy will continue to
include exploration and development drilling programs designed to use
under-balanced horizontal drilling technologies and to use three dimensional
("3-D") seismic technology with comprehensive integration of subsurface control,
production, engineering, and other data, as available, as a means of reducing
risks.

Normally our capital budget would be 40% acquisitions, 30% re-engineering and
development, and 30% exploration. However, considering the current industry
conditions,

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we intend to focus on 30% acquisitions (either purchase of assets, or corporate
acquisitions and mergers, that we expect will be available in 2001), 20% on
re-engineering and development and 50% on exploration drilling. We have budgeted
approximately $5 million capital expenditures in 2001 related to currently held
projects.

We have set a goal of $20 million of capital expenditures related to the
development of these new properties. If we are successful in our goals,
approximately 85% of our budget will be for exploration and drilling, purchases
and re-engineering of producing properties, with the remainder dedicated to
exploitation and development activities, pre-drilling exploration costs and
acquisitions. The proportion of our capital expenditure budget expended for each
of these activities could change substantially, depending upon the relative cost
of the drilling and acquisition opportunities presented to us, the availability
of external financing and our assessment of the risk, cost, and potential
return.

We will continue to direct a portion of our capital budget and manpower to
exploration activities, by means of retaining direct interests and selling
interests in our prospects to industry participants for cash, and carried or
reversionary interests. Under such arrangements, our percentage interest in
revenues from successful drilling could be higher than our percentage share of
the cost. This strategy is intended to expose us to potentially significant
reserves.

Hedging Activities

In connection with future production, we will hedge certain future natural gas
production quantities, in order to reduce our sensitivity to price fluctuations.
We intend to engage in hedging activities through price swaps, derivative
financial instruments and other market risk sensitive instruments in connection
with new production and acquisitions, if any. We use such instruments for the
purpose of reducing our exposure to the volatility of oil and gas prices and not
for speculative investment purposes. While intended to reduce the effects of oil
and gas price volatility, hedging transactions may limit potential gains earned
by us from oil and gas price increases and may expose us to the risk of
financial loss in certain circumstances. In a typical hedge transaction, it is
expected that we will receive payment from a counterparty to the hedge of the
excess of the fixed price specified in the hedge contract over a floating price
based on a market index, multiplied by the volume of production hedged.
Conversely, if the floating price exceeds the fixed price, we would be required
to pay the counterparty the difference multiplied by the volume of production
hedged. We would be required to pay the difference between the floating price
and the fixed price regardless of whether we have sufficient production to cover
the quantities specified in the hedge. Under such circumstances, unanticipated
reductions in production could require us to make payments even when such
payments are not offset by proceeds from sales of production. Although we could
benefit from a hedging arrangement, hedging could also prevent us from receiving
the full advantage of increases in crude oil or natural gas prices above the
fixed price specified in the hedge.

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Joint Operations With Others; Non-Operator Status

We may own less than 100% of the working interest in many of our oil and gas
holdings. Operations are likely to be conducted jointly with other working
interest owners. Joint operating arrangements are customary in the oil and gas
industry and are generally conducted pursuant to a joint operating agreement
whereby a single working interest owner is designated the operator. At present,
we are the operator of the majority of our oil and gas properties. We could
possibly be a non-operating working interest owner in other wells in the future.
For properties where we own less than 50% of the working interest, drilling and
operating decisions may not be entirely within our control. If we disagree with
the decision of a majority of working interest owners, we may be required, among
other things, to postpone the proposed activity, relinquish or farm-out its
interest or decline to participate. If we decline to participate, we might be
forced to relinquish our interest or may be subject to certain non- consent
penalties, as provided in the applicable operating agreement. Such penalties
typically allow participating working interest owners to recover from the
proceeds of production, if any, an amount equal to 200%-500% of the
non-participating working interest owner's share of the cost of such operations.

Under most operating agreements, the operator is given direct and full control
over all operations on the properly and is obligated to conduct operations in a
workman-like manner; however the operator is usually not liable to the working
interest owners for losses sustained or for liabilities incurred, except those
resulting from its own gross negligence or willful misconduct. Each working
interest owner is generally liable for its share of the costs of developing and
operating jointly owned properties. The operator is required to pay the expenses
of developing and operating the property and will invoice working interest
owners for their proportionate share of such costs. In instances where we are a
non-operating working interest owner, we may have a limited ability to exercise
control over operations and the associated costs of such operations. The success
of our investment in such non-operated activities may, therefore, be dependent
upon a number of facts that are outside of our direct control.

Under most operating agreements and the laws of certain states, operators of oil
and gas properties may be granted liens on the working interests of other
non-operating owners in the well to secure the payment of amounts due the
operator. The bankruptcy or failure of the operator or other working interest
owners to pay vendors who have supplied goods or services applicable to wells
could result in filing of mechanics' and materialmens' liens which would
encumber the well and the interests of all joint owners At this time, we do not
have Joint operating arrangements in which we own less than 100% of the working
interest in our oil and gas holdings. However, we anticipate that in the future
some operations will be conducted jointly with other working interest owners
pursuant to a joint operating agreement whereby a single working interest owner
is designated the operator.

Markets and Customers


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The revenue generated by our operations are highly dependent upon the prices of,
and demand for crude oil and natural gas. Historically, the markets for crude
oil and natural gas have been volatile and are likely to continue to be volatile
in the future. The prices received by the Company for its crude oil and natural
gas production and the level of such production are subject to wide fluctuations
and depend on numerous factors beyond our control including seasonality, the
condition of the United States economy (particularly the manufacturing sector),
foreign imports, political conditions in other oil-producing and natural
gas-producing countries, the actions of the Organization of Petroleum Exporting
Countries and domestic regulation, legislation and policies. Decreases in the
prices of crude oil and natural gas have had, and could have in the future, an
adverse effect on the carrying value of our proved reserves and our revenue,
profitability and cash flow from operations.

In order to manage our exposure to price risks in the marketing of our crude oil
and natural gas, we, from time to time, will have to enter into fixed price
delivery contracts, financial swaps and crude oil and natural gas futures
contracts as hedging devices. To ensure a fixed price for future production, we
may sell a futures contract and thereafter either (i) make physical delivery of
crude oil or natural gas to comply with such contract or (ii) buy a matching
futures contract to unwind its futures position and sell its production to a
customer. Such contracts may expose us to the risk of financial loss in certain
circumstances, including instances where production is less than expected, our
customers fail to purchase or deliver the contracted quantities of crude oil or
natural gas, or a sudden, unexpected event materially impacts crude oil or
natural gas prices. Such contracts may also restrict the ability of us to
benefit from unexpected increases in crude oil and natural gas prices.

Competition

We operate in a highly competitive environment. Competition is particularly
intense with respect to the acquisition of desirable undeveloped crude oil and
natural gas properties. The principal competitive factors in the acquisition of
such undeveloped crude oil and natural gas properties include the staff and data
necessary to identify, investigate and purchase such properties, and the
financial resources necessary to acquire and develop such properties. We compete
with major and independent crude oil and natural gas companies for properties
and the equipment and labor required to develop and operate such properties.
Many of these competitors have financial and other resources substantially
greater than ours.

The principal resources necessary for the exploration and production of crude
oil and natural gas are leasehold prospects under which crude oil and natural
gas reserves may be discovered, drilling rigs and related equipment to explore
for such reserves and knowledgeable personnel to conduct all phases of crude oil
and natural gas operations. We must compete for such resources with both major
crude oil and natural gas companies and independent operators. Although we
believe our current operating and financial resources are adequate to preclude
any significant disruption of our operations in the immediate future, we cannot
assure you that such materials and resources will be available to us.

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We face significant competition for obtaining additional natural gas supplies
for gathering and processing operations, for marketing NGLs, residue gas,
helium, condensate and sulfur, and for transporting natural gas and liquids. Our
principal competitors include major integrated oil companies and their marketing
affiliates and national and local gas gatherers, brokers, marketers and
distributors of varying sizes, financial resources and experience. Certain
competitors, such as major crude oil and natural gas companies, have capital
resources and control supplies of natural gas substantially greater than the
Company. Smaller local distributors may enjoy a marketing advantage in their
immediate service areas.

We compete against other companies in our natural gas processing business both
for supplies of natural gas and for customers to which we sell our products.
Competition for natural gas supplies is based primarily on location of natural
gas gathering facilities and natural gas gathering plants, operating efficiency
and reliability and ability to obtain a satisfactory price for products
recovered. Competition for customers is based primarily on price and delivery
capabilities.

Regulatory Matters

Our operations are affected from time to time in varying degrees by political
developments and federal, state, provincial and local laws and regulations. In
particular, oil and gas production operations and economics are, or in the past
have been, affected by price controls, taxes, conservation, safety,
environmental, and other laws relating to the petroleum industry, by changes in
such laws and by constantly changing administrative regulations.

Price Regulations

In the recent past, maximum selling prices for certain categories of crude oil,
natural gas, condensate and NGLs in the United States were subject to federal
regulation. In 1981, all federal price controls over sales of crude oil,
condensate and NGLs were lifted. In 1993, the Congress deregulated natural gas
prices for all "first sales" of natural gas. As a result, all sales of our
United States produced crude oil, natural gas, condensate and NGLs may be sold
at market prices, unless otherwise committed by contract.

United States Natural Gas Regulation

Historically, interstate pipeline companies in the United States generally acted
as wholesale merchants by purchasing natural gas from producers and reselling
the gas to local distribution companies and large end users. Commencing in late
1985, the Federal Energy Regulatory Commission (the "FERC") issued a series of
orders that have had a major impact on interstate natural gas pipeline
operations, services, and rates, and thus have significantly altered the
marketing and price of natural gas. The FERC's key rule making action, Order No.
636 ("Order 636"), issued in April 1992, required each interstate pipeline to,
among other things, "un-bundle" its traditional bundled sales services and
create and make available on an open

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and nondiscriminatory basis numerous constituent services (such as gathering
services, storage services, firm and interruptible transportation services, and
standby sales and gas balancing services), and to adopt a new ratemaking
methodology to determine appropriate rates for those services. To the extent the
pipeline company or its sales affiliate makes natural gas sales as a merchant,
it does so pursuant to private contracts in direct competition with all of the
sellers, such as us; however, pipeline companies and their affiliates were not
required to remain "merchants" of natural gas, and most of the interstate
pipeline companies have become "transporters only," although many have
affiliated marketers. In subsequent orders, the FERC largely affirmed the major
features of Order 636. By the end of 1994, the FERC had concluded the Order 636
restructuring proceedings, and, in general, accepted rate filings implementing
Order 636 on every major interstate pipeline. The federal appellate courts have
largely affirmed the significant features of Order No. 636 and numerous related
orders pertaining to the individual pipelines. We do not believe that Order 636
and the related restructuring proceedings affect us any differently than other
natural gas producers and marketers with which we compete.

In recent years the FERC also has pursued a number of other important policy
initiatives that could significantly affect the marketing of natural gas in the
United States. Some of the more notable of these regulatory initiatives include
(i) a series of orders in individual pipeline proceedings articulating a policy
of generally approving the voluntary divestiture of interstate pipeline owned
gathering facilities by interstate pipelines to their affiliates (the so-called
"spin down" of previously regulated gathering facilities to the pipeline's
non-regulated affiliates), (ii) the completion of rule-making involving the
regulation of pipelines with marketing affiliates under Order No. 497, (iii)
various FERC orders adopting rules proposed by the Gas Industry Standards Board
which are designed to further standardize pipeline transportation tariffs and
business practices, (iv) a notice of proposed rule making that, among other
things, proposes (aa) to eliminate the cost-based price cap currently imposed on
natural gas transactions of less than one year in duration, (bb) to establish
mandatory "transparent" capacity auctions of short-term capacity on a daily
basis, and (cc) to permit interstate pipelines to negotiate terms and conditions
of service with individual customers, (v) a notice of inquiry which continues
the FERC's review of its regulatory policies with respect to the pricing of
long-term pipeline transportation services by presenting a range of questions to
the industry dealing with current cost-based pricing of new and existing
capacity and alternative rate mechanism options, including the desirability of
pricing interstate pipeline capacity utilizing market-based rates, incentive
rates, or indexed rates, and (vi) a notice of proposed rule making that proposes
generic procedures to expedite the FERC's handling of complaints against
interstate pipelines with the goals of encouraging and supporting consensual
resolutions of complaints and organizing the complaint procedures so that all
complaints are handled in a timely and fair manner. Several of these initiatives
are intended to enhance competition in natural gas markets, although some, such
as "spin downs," may have the adverse effect of increasing the cost of doing
business on some in the industry, including us as a result of the monopolization
of those facilities by their new, unregulated owners. As to all of these FERC
initiatives, the ongoing, or, in some instances, preliminary and evolving


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nature of these regulatory initiatives makes it impossible at this time to
predict their ultimate impact on our business. However, we do not believe that
these FERC initiatives will affect it any differently than other natural gas
procedures and marketers with which it competes.

Since Order 636 FERC decisions involving onshore facilities have been more
liberal in their reliance upon traditional tests for determining what facilities
are "gathering" and therefore exempt from federal regulatory control. In many
instances, what was once classified as "transmission" may now be classified as
"gathering." The Company ships certain of its natural gas through gathering
facilities owned by others, including interstate pipelines, under existing long
term contractual arrangements. Although these FERC decisions have created the
potential for increasing the cost of shipping our gas on third party gathering
facilities, the Company's shipping activities have not been materially affected
by these decisions.

Commencing in October 1993, the FERC issued a series of rules (Order Nos. 561
and 561-A) establishing an indexing system under which oil pipelines will be
able to change their transportation rates, subject to prescribed ceiling levels.
The indexing system, which allows or may require pipelines to make rate changes
to track changes in the Producer Price Index for Finished Goods, minus one
percent, became effective January 1, 1995. In certain circumstances, these rules
permit oil pipelines to establish rates using traditional cost of service or
other methods of rate making. We do not believe that these rules affect us any
differently than other crude oil producers and marketers with which we compete.

Additional proposals and proceedings that might affect the natural gas industry
in the United States are considered from time to time by Congress, the FERC,
state regulatory bodies and the courts. We cannot predict when or if any such
proposals might become effective or their effect, if any, on our operations. The
oil and gas industry historically has been very heavily regulated; thus there is
no assurance that the less stringent regulatory approach recently pursued by the
FERC and Congress will continue indefinitely into the future.

State and Other Regulation

All of the jurisdictions in which we lease or own producing crude oil and
natural gas properties have statutory provisions regulating the exploration for
and production of crude oil and natural gas, including provisions requiring
permits for the drilling of wells and maintaining bonding requirements in order
to drill or operate wells and provisions relating to the location of wells, the
method of drilling and casing wells, the surface use and restoration of
properties upon which wells are drilled and the plugging and abandoning of
wells. Our operations are also subject to various conservation laws and
regulations. These include the regulation of the size of drilling and spacing
units or proration units and the density of wells that may be drilled and the
unitization or pooling of crude oil and natural gas properties. In this regard,
some states and provinces allow the forced pooling or integration of tracts to
facilitate exploration while other states and provinces rely on voluntary
pooling of lands and leases. In addition, state and provincial conservation laws
establish maximum rates of

                                       14
<PAGE>

production from crude oil and natural gas wells, generally prohibit the venting
or flaring of natural gas and impose certain requirements regarding the
ratability of production. Some states, such as Texas and Oklahoma, have, in
recent years, reviewed and substantially revised methods previously used to make
monthly determinations of allowable rates of production from fields and
individual wells. The effect of these regulations is to limit the amounts of
crude oil and natural gas we can produce from its wells, and to limit the number
of wells or the location at which we can drill.

State and provincial regulation of gathering facilities generally includes
various safety, environmental, and in some circumstances, non-discriminatory
take requirements, but does not generally entail rate regulation. In the United
States, natural gas gathering has received greater regulatory scrutiny at both
the state and federal levels in the wake of the interstate pipeline
restructuring under Order 636. For example, on August 19, 1997, the Texas
Railroad Commission enacted a Natural Gas Transportation Standards and Code of
Conduct to provide regulatory support for the State's more active review of
rates, services and practices associated with the gathering and transportation
of gas by an entity that provides such services to others for a fee, in order to
prohibit such entities from unduly discriminating in favor of their affiliates.

In the event we conduct operations on federal or Indian oil and gas leases, such
operations must comply with numerous regulatory restrictions, including various
non-discrimination statutes, and certain of such operations must be conducted
pursuant to certain on-site security regulations and other permits issued by
various federal agencies. In addition, in the United States, the Minerals
Management Service ("MMS") has recently issued a final rule to clarify the types
of costs that are deductible transportation costs for purposes of royalty
valuation of production sold off the lease. In particular, MMS will not allow
deduction of costs associated with marketer fees, cash out and other pipeline
imbalance penalties, or long-term storage fees. Further, the MMS has been
engaged in a three-year process of promulgating new rules and procedures for
determining the value of oil produced from federal lands for purposes of
calculating royalties owed to the government. The oil and gas industry as a
whole has resisted the proposed rules under an assumption that royalty burdens
will substantially increase. We cannot predict what, if any, effect any new rule
will have on its operations.

Environmental Matters

Our operations are subject to numerous federal, state, provincial and local laws
and regulations controlling the generation, use, storage, and discharge of
materials into the environment or otherwise relating to the protection of the
environment. These laws and regulations may require the acquisition of a permit
or other authorization before construction or drilling commences; restrict the
types, quantities, and concentrations of various substances that can be released
into the environment in connection with drilling, production, and gas processing
activities; suspend, limit or prohibit construction, drilling and other
activities in certain lands lying within wilderness, wetlands, and other
protected areas; require remedial

                                       15
<PAGE>

measures to mitigate pollution from historical and on-going operations such as
use of pits and plugging of abandoned wells; restrict injection of liquids into
subsurface strata that may contaminate groundwater; and impose substantial
liabilities for pollution resulting from our operations. Environmental permits
required for our operations may be subject to revocation, modification, and
renewal by issuing authorities. Governmental authorities have the power to
enforce compliance with their regulations and permits, and violations are
subject to injunction, civil fines, and even criminal penalties. We believe that
it is in substantial compliance with current environmental laws and regulations,
and that we will not be required to make material capital expenditures to comply
with existing laws. Nevertheless, changes in existing environmental laws and
regulations or interpretations thereof could have a significant impact on us as
well as the oil and gas industry in general, and thus we are unable to predict
the ultimate cost and effects of future changes in environmental laws and
regulations.

In the United States, the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA"), also known as "Superfund," and comparable state
statutes impose strict, joint, and several liability on certain classes of
persons who are considered to have contributed to the release of a "hazardous
substance" into the environment. These persons include the owner or operator of
a disposal site or sites where a release occurred and companies that generated,
disposed or arranged for the disposal of the hazardous substances released at
the site. Under CERCLA such persons or companies may be retroactively liable for
the costs of cleaning up the hazardous substances that have been released into
the environment and for damages to natural resources, and it is common for
neighboring land owners and other third parties to file claims for personal
injury, property damage, and recovery of response costs allegedly caused by the
hazardous substances released into the environment. The Resource Conservation
and Recovery Act ("RCRA") and comparable state statutes govern the disposal of
"solid waste" and "hazardous waste" and authorize imposition of substantial
civil and criminal penalties for failing to prevent surface and subsurface
pollution, as well as to control the generation, transportation, treatment,
storage and disposal of hazardous waste generated by oil and gas operations.
Although CERCLA currently contains a "petroleum exclusion" from the definition
of "hazardous substance," state laws affecting our operations impose cleanup
liability relating to petroleum and petroleum related products, including crude
oil cleanups. In addition, although RCRA regulations currently classify certain
oilfield wastes which are uniquely associated with field operations as "non-
hazardous," such exploration, development and production wastes could be
reclassified by regulation as hazardous wastes thereby administratively making
such wastes subject to more stringent handling and disposal requirements.

We currently own or lease properties that for many years have been used for the
exploration and production of oil and gas. Although we utilize standard industry
operating and disposal practices, hydrocarbons or other wastes may be disposed
of or released on or under the properties owned or leased by us or on or under
other locations where such wastes have been taken for disposal. In addition,
many of these properties have been operated by third parties whose treatment and
disposal or release of hydrocarbons or other wastes was not under our


                                       16
<PAGE>

control. These properties and the wastes disposed thereon may be subject to
CERCLA, RCRA, and analogous state laws. Our operations are also impacted by
regulations governing the disposal of naturally occurring radioactive materials
("NORM"). The Company must comply with the Clean Air Act and comparable state
statutes which prohibit the emissions of air contaminants, although a majority
of our activities are exempted under a standard exemption. Moreover, owners,
lessees and operators of oil and gas properties are also subject to increasing
civil liability brought by surface owners and adjoining property owners. Such
claims are predicated on the damage to or contamination of land resources
occasioned by drilling and production operations and the products derived
therefrom, and are usually causes of action based on negligence, trespass,
nuisance, strict liability and fraud.

United States federal regulations also require certain owners and operators of
facilities that store or otherwise handle oil to prepare and implement spill
prevention, control and countermeasure plans and spill response plans relating
to possible discharge of oil into surface waters. The federal Oil Pollution Act
("OPA") contains numerous requirements relating to prevention of, reporting of,
and response to oil spills into waters of the United States. For facilities that
may affect state waters, OPA requires an operator to demonstrate $10 million in
financial responsibility. State laws mandate crude oil cleanup programs with
respect to contaminated soil.

We are not currently involved in any administrative, judicial or legal
proceedings arising under domestic or foreign federal, state, or local
environmental protection laws and regulations, or under federal or state common
law, which would have a material adverse effect on our financial position or
results of operations. Moreover, we maintain insurance against costs of clean-up
operations, but it is not fully insured against all such risks. A serious
incident of pollution may, as it has in the past, also result in the suspension
or cessation of operations in the affected area.

Title to Properties

As is customary in the crude oil and natural gas industry, we make only a
cursory review of title to undeveloped crude oil and natural gas leases at the
time they are acquired by us. However, before drilling commences, we require a
thorough title search to be conducted, and any material defects in title are
remedied prior to the time actual drilling of a well begins. To the extent title
opinions or other investigations reflect title defects, we, rather than the
seller of the undeveloped property, is typically obligated to cure any title
defect at its expense. If we were unable to remedy or cure any title defect of a
nature such that it would not be prudent to commence drilling operations on the
property, we could suffer a loss of its entire investment in the property. We
believe that we have good title to our crude oil and natural gas properties,
some of which are subject to immaterial encumbrances, easements and
restrictions.

                                       17
<PAGE>

Strategic Alliance with Paradigm Advanced Technologies

In the summer of 2000, we entered into a strategic alliance with Paradigm
Advanced Technologies to jointly operate Worldlink USA, LLC, a development stage
company (that we previously owned) that owns and licenses video streaming
technology and a library of concerts previously broadcast over the Internet.
Paradigm is a development stage company engaged in the business of developing,
marketing, and selling digital image and interactive global positioning system
tracking technology.

RECENT FINANCING

In December 2000, January 2001 and February 2001, we entered into certain
Securities Purchase Agreements with Generation Capital Associates, STL Capital
Partners, LLC Greenwood Partners, L.P. and The Apmont Group, Inc. The terms of
the securities purchase agreements are summarized below.
<TABLE>
<CAPTION>
Purchaser         Purchase Price                     Maximum Amount of Shares           Maximum Amount of
                                                                                        Warrants (1)(2)
-----------       -----------------         ----------------------------------- ---------------------------
<S>               <C>                       <C>                        <C>
Generation Capital

Associates        $600,000                  1,600,000                  3,450,000 A Warrants (3)
                                                                       3,450,000 B Warrants (3)

STL Capital

Partners, LLC     $250,000                  666,667                    1,333,333 A Warrants
                                                                       1,333,333 B Warrants

Greenwood

Partners, L.P.    $200,000                  533,333                    1,066,666 A Warrants
                                                                       1,066,666 B Warrants

The Apmont

Group, Inc.       $250,000                  550,000 (7)                1,100,000 C Warrants (5) (7)
                                                                       1,100,000 D Warrants (6) (7)

Totals            $1,300,000                3,350,000                  5,924,999 A Warrants (4)
                                                                       5,924,999 B Warrants (4)
                                                                       1,100,000 C Warrants (5) (7)
                                                                       1,100,000 D Warrants (6) (7)
</TABLE>


                                       18
<PAGE>

(1) Upon exercise, each A Warrant is convertible into one share of our Common
Stock and one B Warrant. The A Warrants and B Warrants are both exercisable for
5 years commencing December 29, 2000.

(2) Upon exercise, each B Warrant is convertible into one share of our Common
Stock. The B Warrants are not "callable."

(3) Includes 250,000 A Warrants issued to Generation Capital Associates as a
document preparation fee to the Company. As stated in (1) above, each A Warrant
is convertible into one share of our Common Stock and one B Warrant. As stated
in (2) above, each B Warrant is convertible into one share of our Common Stock.

(4) Includes 75,000 A Warrants issued to M. Richard Cutler as an escrow agent
fee. As stated in (1) above, each A Warrant is convertible into one share of our
Common Stock and one B Warrant. As stated in (2) above, each B Warrant is
convertible into one share of our Common Stock.

(5) Upon exercise, each C Warrant is convertible into one share of our Common
Stock and one D Warrant. The C Warrants and D Warrants are both exercisable for
5 years commencing February 8, 2001.

(6) Upon exercise, each D Warrant is convertible into one share of our Common
Stock. The D Warrants are not "callable."

(7) Includes 50,000 shares and 100,000 C Warrants issued to Bathgate, McColley
Capital Group LLC as a finders fee. As stated in (5) above, each C Warrant is
convertible into one share of our Common Stock and one D Warrant. As stated in
(6) above, each D Warrant is convertible into one share of our Common Stock.

Each A Warrant has a maximum exercise price of $0.75 and a minimum exercise
price of $0.05. If this Registration Statement is not declared effective by
April 13, 2001, the exercise price is $0.375. We can purchase or "call" the A
Warrants at $.05 per Warrant on 30 days notice if our Common Stock has a closing
bid price of at least $2.75 for 20 consecutive trading days after this
Registration Statement is declared effective by the SEC. Each B Warrant has an
exercise price of $1.75. If this Registration Statement is not declared
effective by April 13, 2001, the exercise price is $0.375.

Each C Warrant has a maximum exercise price of $1.00 and a minimum exercise
price of $0.05. If this Registration Statement is not declared effective by
April 27, 2001, the exercise price is $0.50. We can purchase or "call" the C
Warrants at $.05 per warrant on 30 days notice if our common stock has a closing
bid price of at least $2.75 for 20 consecutive trading days after this
Registration Statement is declared effective by the SEC. Each D Warrant has an
exercise price of $1.75. If this Registration Statement is not declared
effective by April 27,

                                       19
<PAGE>

2001, the exercise price is $0.50.

The Securities Purchase Agreements provide that if the average bid price of our
Common Stock is less than $.50 for the 30 trading days commencing on the earlier
of the effective date of this Registration Statement or 105 days from the
closing date (specifically, the closing date was February 8, 2001), the C
Warrants and D Warrants both become "cashless" with a strike price of $.01.

Notwithstanding the above, the Warrant Agreements that we signed with the above
parties do not allow any of the parties to exercise Warrants that would cause
such party to be the beneficial owner of more than 5% of our then outstanding
shares of Common Stock. This restriction shall not prevent any such party from
acquiring more than 5% of our shares of Common Stock as long as such party does
not beneficially own more than 5% at any given time. The maximum amount of
shares of our Common Stock that can be acquired under the Securities Purchase
Agreements are as follows: Generation Capital Associates - 8,500,000; Greenwood
Partners, LP - 2,666,665; STL Capital Partners, LLC - 3,333,333, and The Apmont
Group, Inc. - 2,500,000.

The Securities Purchase Agreements provide that if the average bid price of our
Common Stock is less than $.50 for the 30 trading days commencing on the earlier
of the effective date of this Registration Statement or 105 days from the first
traunch closing date (specifically, the first trauch closing date was December
29, 2000), the A Warrants and B Warrants both become "cashless" with a strike
price of $.01.

With respect to the above described transaction, we have entered into escrow
agreements with the above parties and M. Richard Cutler, Esq. and David A.
Rapaport, Esq. as joint escrow agents ("Escrow Agents"). The Escrow Agents will
hold the maximum amount of shares issuable under the Securities Purchase
Agreements which is a total of 16,749,998 shares of our Common Stock. To date,
the Escrow Agents have been issued a total of 16,149,998 shares of our Common
Stock. We have an obligation under the Securities Purchase Agreements to issue
the balance of the shares of our Common Stock, specifically, 600,000 shares, to
the Escrow Agents.

Employees

As of April 10, 2001, Pangea has 4 full-time employees, including executive
officers, non- executive officers, secretarial and clerical personnel and field
personnel. Additionally, Pangea retains contract pumpers on a month-to-month
basis. Pangea also retains independent geological and engineering consultants
from time to time on a limited basis and expects to continue to do so in the
future.

As of April 10, 2001, Mass Energy has 2 full-time employees, including executive
officers, non-executive officers, secretarial and clerical personnel and field
personnel.

                                       20
<PAGE>

ITEM 2. DESCRIPTION OF PROPERTY
-------------------------------

Pangea and Mass Energy share executive and administrative offices located at
6776 SW Freeway, Suite 620, Houston, Texas 77074, consisting of approximately
3,234 rentable square feet (8 offices). Such space is leased until October 31,
2003 at an aggregate rate of $3,665.20 per month until October 31, 2001;
$3,692.15 from November 1, 2001 until October 31, 2002; and $3,719.10 from
November 1, 2002 until October 31, 2003.

ITEM 3.  LEGAL PROCEEDINGS
--------------------------

General. From time to time, we are involved in litigation relating to claims
arising out of our operations in the normal course of business. We are not
currently engaged in any legal proceedings that are expected, individually or in
the aggregate, to have a material adverse effect on us.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

On November 21, 2000, we held a meeting of our shareholders and approved the
following actions: (i) elected the following directors: Charles B. Pollock,
David H. Lennox and Randall W. Massey; (ii) change our domicile from Colorado to
Delaware; (iii) increase our authorized number of shares to 100,000,000; (iv)
approve the Stock Acquisition and Merger Agreement between us and Mass Energy,
Inc.; (v) approve the appointment of Richard I. Anslow & Associates (now known
as Anslow & Jaclin, LLP) as outside corporate general counsel; (vi) approve our
2001 capital budget; and (vii) approve the change of listing of our common stock
from the OTC Electronic Bulletin Board to the American Stock Exchange upon
meeting the minimum listing requirements for the American Stock Exchange. We
have yet to undertake (ii) and (vii) above.

On December 18, 2000, the majority of our shareholders, by majority written
consent, appointed Edward R. Skaggs to our Board of Directors.

                                       21
<PAGE>

                                    PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
-----------------------------------------------------------------

As of April 10, 2001, Pangea had 47,370,898 shares of common stock outstanding
and had approximately 125 stockholders of record (this includes shares held by
Cede & Co. as one shareholder. Cede & Co. may hold shares for numerous
shareholders and we estimate that we have at least 500 shareholders).

The following table sets forth certain information as to the high and low bid
quotations quoted on the OTC Bulletin Board for 1998, 1999, 2000 and 2001
(through January 31, 2001). Information with respect to over-the-counter bid
quotations represents prices between dealers, does not include retail mark-ups,
mark-downs or commissions, and may not necessarily represent actual
transactions.
<TABLE>
<CAPTION>
                                    Period           High              Low
                                    --------         ------            -----
<S>                                 <C>              <C>               <C>
                                    1998

During 1998, the Company was known as Zip Top, Inc. and traded under the symbol
"ZTOP." We have not been able to locate information regarding the trading price
of ZTOP during this time period.

                                    1999

First Quarter                                        5.00              1.44
Second Quarter                                       6.50              1.44
Third Quarter                                        2.38                .44
Fourth Quarter                                       1.00                .18

                                    2000

First Quarter                                        1.94                .19
Second Quarter                                       2.99                .28
Third Quarter                                        2.81              1.19
Fourth Quarter                                       1.78                .63

                                    2001

First Quarter                                        1.72                .63
</TABLE>

DIVIDENDS

We do not intend to retain future earnings to support our growth. Any payment of
cash dividends in the future will be dependent upon: the amount of funds legally
available therefore; our earnings; financial condition; capital requirements;
and other factors which our Board of Directors deems relevant.


                                      II-1
<PAGE>


ITEM 6. FINANCIAL STATEMENTS

The financial statements of the Company, together with the report of auditors,
are included herein.


                                       II-2
<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                                      Index

Independent Auditors' Report                                                 F-2

Consolidated Financial Statements:

       Balance Sheets - December 31, 2000 and 1999                           F-3

       Statements of Operations - Years ended December 31, 2000, 1999
           and 1998                                                          F-4
       Statements of Stockholders' Equity - Years ended December 31, 2000,
           1999 and 1998                                                     F-5

       Statements of Cash Flows - Years ended December 31, 2000, 1999
           and 1998                                                          F-6

Notes to Consolidated Financial Statements                                   F-7

<PAGE>

R. E. Bassie & Co., P.C.
Certified Public Accountants
A Professional Corporation
--------------------------------------------------------------------------------
                                         6776 Southwest Freeway, Suite 580
                                         Houston, Texas 77074-2107
                                         Tel: (713) 266-0691 Fax: (713) 266-0692
                                         E-Mail: Rebassie@aol.com

                          Independent Auditors' Report

The Board of Directors and Stockholders:
Pangea Petroleum Corporation

We have audited the consolidated balance sheets of Pangea Petroleum Corporation
and Subsidiary as of December 31, 2000 and 1999, and the related consolidated
statements of operations, stockholders' equity and cash flows for the three-year
periods then ended. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Pangea Petroleum
Corporation and Subsidiary as of December 31, 2000 and 1999, and the results of
their operations and their cash flows for the three-year periods then ended, in
conformity with generally accepted accounting principles.

                           /s/ R. B. Bassie & Co., P.C.


Houston, Texas
January 26, 2001, except with respect to
   Notes 7 and 12 to which the date is
   March 23, 2001


                                      F-2

<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                           Consolidated Balance Sheets

                           December 31, 2000 and 1999
<TABLE>
<CAPTION>

                              Assets                                       2000           1999
                                                                           ----           ----
<S>                                                                   <C>             <C>
Current assets: ...................................................   $    629,186    $         --
      Cash
      Accounts receivable, less allowance for doubtful accounts of
           $104,734 in 2000 and $0 in 1999 ........................         86,551           7,598
      Prepaid expenses ............................................          2,939              --
                                                                      ------------    ------------
                Total current assets ..............................        718,676           7,598
                                                                      ------------    ------------

Noncurrent receivables from related parties (note 6) ..............        198,500              --
Property held for investment ......................................         46,642              --
Investment in affiliate (note 4) ..................................        125,000              --

Property and equipment (successful efforts) (note 3) ..............      2,579,865          89,795
      Less accumulated depreciation, depletion and amortization ...        139,419          12,774
                                                                      ------------    ------------
                                                                         2,440,446          77,021

Other assets ......................................................            988             988
                                                                      ------------    ------------
                Total assets ......................................   $  3,530,252    $     85,607
                                                                      ============    ============

                      Liabilities and Stockholders' Equity

Current liabilities:
      Accounts payable and accrued expenses .......................        419,409          96,706
      Loans payable to shareholders (note 6) ......................         60,000         463,120
                                                                      ------------    ------------
                Total liabilities - current .......................        479,409         559,826
                                                                      ------------    ------------
Stockholders' equity, as restated (notes 2,7,8 and 12):

      Preferred stock, $.01 par value. Authorized 5,000,000 shares:
           None issued and outstanding, in 2000 and 1999 ......               --                --
      Common stock, $.001 par value. Authorized 100,000,000 shares:
           issued and outstanding, 42,799,900 at December 31, 2000
           and 17,859,000 at December 31, 1999 ....................         42,800          17,859
      Additional paid-in capital ..................................     10,910,763         222,996
      Accumulated deficit .........................................     (7,217,720)      (715,074)
                                                                      ------------    ------------
                                                                         3,735,843       (474,219)
      Less common stock subscriptions receivable ..................       (685,000)             --
                                                                      ------------    ------------
                Total stockholders' equity ........................      3,050,843       (474,219)

Commitments and contingent liabilities (note 8)
                                                                      ------------    ------------
                Total liabilities and stockholders' equity ........   $  3,530,252    $     85,607
                                                                      ============    ============
</TABLE>
See accompanying notes to consolidated financial statements.

                                      F-3

<PAGE>

                PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                 Consolidated Statements of Operations

              Years ended December 31, 2000, 1999 and 1998
<TABLE>
<CAPTION>

                                                         2000            1999           1998
                                                         ----            ----           ----
                                                      (Restated)
<S>                                                  <C>             <C>             <C>
Revenues                                             $         --    $     33,431    $         --

Costs and expenses:
      Exploration/abandonment expense                   1,377,967              --              --
      Cost of sales                                            --          71,105              --
      Selling, general and administrative (note 6)      3,870,794         208,818           3,384
      Impairment expenses                                 552,550          75,653              --
      Depreciation, depletion and amortization              4,939          12,774              --
                                                     ------------    ------------    ------------
         Total operating expenses                       5,806,250         368,350           3,384
                                                     ------------    ------------    ------------

         Operating loss                                (5,806,250)       (334,919)        (3,384)

Other (income) expense:
      Interest income                                       4,953              --              22
      Acquisition costs (note 2)                          (78,750)       (236,000)             --
      Loss on disposition of assets                            --         (61,000)             --
      Interest expense (note 6)                          (622,599)        (63,850)             --
                                                     ------------    ------------    ------------
         Total other expense                             (696,396)       (360,850)             22
                                                     ------------    ------------    ------------

         Net loss before income taxes                  (6,502,646)       (695,769)        (3,362)

Provision for federal income taxes (note 5)                    --              --              --

                                                     ------------    ------------    ------------
         Net loss                                    $ (6,502,646)   $   (695,769)   $    (3,362)
                                                     ============    ============    ============


Net loss per share - basic and diluted               $      (0.27)   $      (0.04)   $     (0.00)
                                                     ============    ============    ============

Weighted average common shares                         24,304,257      17,784,313      17,720,333
                                                     ============    ============    ============
</TABLE>

 See accompanying notes to consolidated financial statements.

                                      F-4
<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                 Consolidated Statements of Stockholders' Equity
                  Years ended December 31, 2000, 1999 and 1998
<TABLE>
<CAPTION>
                                                                                                         Common
                                                                        Additional                        stock          Total
                                                Common Stock             paid-in         Retained     subscriptions  stockholders'
                                           shares          amount        capital         earnings       receivable       equity
                                       ------------    ------------   ------------    ------------    ------------    ------------
<S>                                      <C>           <C>            <C>             <C>             <C>             <C>
Balance, January 1, 1998                    410,000    $        410   $     15,895    $    (15,943)   $         --    $        362

  Issuance of restricted common shares
     for services                            12,000              12          2,988              --              --           3,000

  14 for 1 forward stock
     split August 7, 1998                 5,486,000           5,486         (5,486)             --              --              --

  3 for 1 forward stock
     split December 11, 1998             11,816,000          11,816        (11,816)             --              --              --

  Net loss                                       --              --             --          (3,362)             --          (3,362)
                                       ------------    ------------   ------------    ------------    ------------    ------------

Balance, December 31, 1998               17,724,000          17,724          1,581         (19,305)             --              --

  Issuance of restricted common shares
     under private placement                 50,000              50        106,450              --              --         106,500

  Issuance of restricted common shares
     for property                            35,000              35         74,515              --              --          74,550

  Issuance of restricted common shares
     for services                            50,000              50         40,450              --              --          40,500

  Net loss                                       --              --             --        (695,769)             --        (695,769)

                                       ------------    ------------   ------------    ------------    ------------    ------------
Balance, December 31, 1999               17,859,000          17,859        222,996        (715,074)             --        (474,219)

  Issuance of restricted common shares
     under private placement (note 7)    15,055,645          15,056      1,746,084              --        (685,000)      1,076,140

  Issuance of restricted common shares
     for investor relations (note 6)      2,789,372           2,789      2,705,621              --              --       2,708,410

  Issuance of common  shares
     for contractual services (note 6)      154,750             155        237,150              --              --         237,305

  Issuance of restricetd common shares
     for acquisition of oil and
     gas property                           325,000             325        454,675              --              --         455,000

Exercise of stock options (note 8)        1,156,000           1,156      1,362,577              --              --       1,363,733

  Issuance of restricted common shares
      for conversion of debt (note 6)     3,460,133           3,460      1,308,660              --              --       1,312,120

  Issuance of restricted common shares
      for acquisition (note 2)            2,000,000           2,000      2,748,000              --              --       2,750,000

Issuance of warrants (note 4)                    --              --        125,000              --              --         125,000

  Net loss                                                                              (6,502,646)             --      (6,502,646)
                                       ------------    ------------   ------------    ------------    ------------    ------------
Balance, December 31, 2000               42,799,900    $     42,800   $ 10,910,763    $ (7,217,720)   $   (685,000)   $  3,050,843
                                       ============    ============   ============    ============    ============    ============
</TABLE>
See accompanying notes to consolidated financial statements.
                                      F-5
<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                      Consolidated Statements of Cash Flows

                  Years ended December 31, 2000, 1999 and 1998
<TABLE>
<CAPTION>
                                                                            2000           1999           1998
                                                                        -----------    -----------    -----------
                                                                         (Restated)
<S>                                                                     <C>            <C>            <C>
Cash flows from operating activities:

        Net loss                                                        $(6,502,646)   $  (695,769)   $    (3,362)
        Adjustments to reconcile net loss to net cash
             used in operating activities:
                  Depreciation of property and equipment                      4,939         12,774            362
                   Impairment expense                                       552,550         75,653             --
                  Dryhole expense                                         1,031,857             --             --
                  Stock issued for services (note 6)                      2,945,715             --             --
                  Payroll expenses related to stock options                 245,233             --             --
                  Interest expenses on conversion of debt                   622,449             --             --
                  (Increase) decrease in operating assets:
                       Accounts receivable                                  268,875         (7,598)            --
                       Prepaid expenses                                       2,950             --             --
                       Other assets                                              --           (988)            --
                  Increase (decrease) in operating liabilities:
                       Accounts payable and accrued expenses               (578,315)        90,775             --
                       Advances from joint interest parties                (161,300)            --             --
                                                                        -----------    -----------    -----------
                            Net cash used in operating activities        (1,567,693)      (525,153)        (3,000)
                                                                        -----------    -----------    -----------

Cash flows from investing activities:
        Cash acquired in acquisition                                        494,868             --             --
        Purchase of property and equipment                                       --        (90,898)            --
        Purchase of real estate                                             (46,642)            --             --
                                                                        -----------    -----------    -----------
                            Net cash used in investing activities           448,226        (90,898)            --
                                                                        -----------    -----------    -----------

Cash flows from financing activities:
        Proceeds from the sale of restricted common stock                 1,076,140         90,500          3,000
        Proceeds from the exercise of stock options                       1,118,500             --             --
        Proceeds from (repayment of) advances from related parties         (708,066)       357,620             --
        Proceeds from notes payable from related parties                    238,551        162,000             --
        Increase in bank overdrafts                                          23,528          5,931             --
                                                                        -----------    -----------    -----------
                            Net cash provided by financing activities     1,748,653        616,051          3,000
                                                                        -----------    -----------    -----------

                            Net Increase in cash                            629,186             --             --

Cash at beginning of year                                                   629,186             --             --
Cash at end of year

Supplemental schedule of cash flow information:

   Non-cash transactions:
        Issuance of restricted common stock for acquisition
         of property                                                        455,000        74,515              --
        Acquisition of subsidiary by issuance of restricted
         common stock, net of $494,868 cash required (note 2)           $ 2,255,132             --             --
        Subscription of common stock                                        685,000             --             --
        Issuance of restricted common stock for conversion of debt      $ 1,312,120    $        --    $        --
                                                                        ===========    ===========    ===========
</TABLE>

See accompanying notes to consolidated financial statements.

                                      F-6

<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        December 31, 2000, 1999 and 1998

(1)      ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

         ORGANIZATION

          Pangea Petroleum Corporation (Pangea or the Company), formerly Zip
          Top, Inc., was incorporated in 1997 and is engaged in oil and gas
          exploration and development with its wholly-owned subsidiary, Mass
          Energy, Inc.,

         PRINCIPLES OF CONSOLIDATION

         The consolidated financial statements include the accounts of the
         Company and its wholly owned subsidiary. All significant intercompany
         transactions and balances have been eliminated in consolidation.

         ACCOUNTS RECEIVABLE

         Accounts receivable consist primarily of trade receivables, net of a
         valuation allowance for doubtful amounts.

         INVENTORIES

         Inventories are valued at the lower of cost or market on a first in,
         first out basis.

         OIL AND GAS PRODUCING ACTIVITIES

         The Company follows the "successful efforts" method of accounting for
         its oil and gas properties. Under this method of accounting, all
         property acquisition costs (cost to acquire mineral interests in oil
         and gas properties) and costs (to drill and equip) of exploratory and
         development wells are capitalized when incurred, pending determination
         of whether the well has found proved reserves. If an exploratory well
         has not found proved reserves in commercial quantities, the costs
         associated with the well are charged to expense. The costs of
         development wells are capitalized whether productive or nonproductive.
         Geological and geophysical costs and the costs of carrying and
         retaining undeveloped properties are expensed as incurred. Management
         estimates that the salvage value of lease and well equipment will
         approximately offset the future liability for plugging and abandonment
         of the related wells. Accordingly, no accrual for such costs has been
         recorded.

         Unproved oil and gas properties that are individually significant are
         periodically assessed for impairment of value, and a loss is recognized
         at the time of impairment by providing an impairment allowance. Other
         unproved properties are amortized based on the Company's experience of
         successful drilling and average holding period. Capitalized costs of
         producing oil and gas properties, after

                                      F-7

<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

         considering estimated dismantlement and abandonment costs and estimated
         salvage values, are depreciated and depleted by the unit-of-production
         method.

         On the sale or retirement of a complete unit of a proved property, the
         cost and related accumulated depreciation, depletion, and amortization
         are eliminated from the property accounts, and the resultant gain or
         loss is recognized. On the retirement or sale of a partial unit of
         proved property, the cost is charged to accumulated depreciation,
         depletion, and amortization with a resulting gain or loss recognized in
         income.

         On the sale of an entire interest in an unproved property for cash or
         cash equivalent, gain or loss on the sale is recognized, taking into
         consideration the amount of any recorded impairment if the property had
         been assessed individually. If a partial interest in an unproved
         property is sold, the amount received is treated as a reduction of the
         cost of the interest retained.

         OTHER PROPERTY AND EQUIPMENT

         Property and equipment are recorded at cost less accumulated
         depreciation. Upon retirement or sale, the cost of the assets disposed
         of and the related accumulated depreciation are removed from the
         accounts, with any resultant gain or loss being recognized as a
         component of other income or expense. Depreciation is computed over the
         estimated useful lives of the assets (7 years) using accelerated
         methods for financial reporting purposes and for income tax purposes

         Ordinary maintenance and repairs are charged to expense and,
         expenditures that extend the physical or economic life of the assets,
         are capitalized. Gains or losses on disposition of assets are
         recognized in income, and the related assets and accumulated
         depreciation accounts are adjusted accordingly.

         IMPAIRMENT OF LONG-LIVED ASSETS

         The Company applies the provisions of the Statement of Financial
         Accounting Standards No. 121, ACCOUNTING FOR THE IMPAIRMENT OF
         LONG-LIVED ASSETS AND FOR LONG-LIVED ASSETS TO BE DISPOSED OF.
         Consequently, the Company assesses impairment whenever events or
         changes in circumstances indicate that the carrying amount of
         long-lived assets may not be recoverable. When required, impairment
         losses on assets to be held and used are recognized based on the fair
         value of the asset and long-lived assets to be disposed of and are
         reported at the lower of carrying amount or fair value less cost to
         sell.

                                      F-8

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998


         ACCOUNTING ESTIMATES

         The preparation of financial statements in conformity with generally
         accepted accounting principles requires management to make estimates
         and assumptions that affect the amounts reported in the financial
         statements and the accompanying notes. The actual results could differ
         from those estimates.

         The Company's financial statements are based on a number of significant
         estimates including the allowance for doubtful accounts, and selection
         of the useful lives for property, plant and equipment.

         As mandated under SFAS No. 121, the company is required under certain
         circumstances to evaluate the possible impairment of the carrying value
         of its long-lived assets.

         REAL ESTATE HELD FOR SALE

         Real estate held for sale is carried at the lower of cost or fair
         market value, net of selling costs. Management assesses the value of
         real estate held for sale on a quarterly and annual basis to determine
         if any impairment to this net realizable value has occurred. Management
         closely monitors any changes in the real estate market, which would
         indicate that a change in the value of its holdings has occurred and
         also obtains independent third party appraisals on its holdings on an
         as-needed basis.

         CASH AND CASH EQUIVALENTS

         For purposes of the statement of cash flows, the Company considers cash
         equivalents to include all cash items, such as time deposits and
         short-term investments with original maturities of three months or
         less.

         FAIR VALUE OF FINANCIAL INSTRUMENTS

         Fair value estimates of the Company's financial instruments are made at
         discrete points in time based on relevant market information. These
         estimates may be subjective in nature and involve uncertainties and
         matters of significant judgment and, therefore, cannot be determined
         with precision. The Company believes that the carrying amounts of its
         current assets and current liabilities approximate the fair value of
         such items. The carrying amount of cash and cash equivalents
         approximates its fair value because of the short maturity of these
         instruments.

         The Company estimates the fair value of its financial instruments using
         available market information and appropriate valuation methodologies.
         However, considerable judgment is required in interpreting market data
         to develop the estimates of fair value. Accordingly, the Company
         estimates of fair value are not necessarily indicative of the amounts
         that the Company could realize in a current market exchange. The use of
         different market assumption and/or estimation methodologies may have a
         material effect on the estimated fair value amounts. The Company
         believes that the fair value of its financial instruments comprising
         accounts receivable, accounts payable, and notes payable approximate
         their carrying amounts.

                                      F-9

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

         CONCENTRATION OF CREDIT RISK

         Financial instruments which potentially expose the Company to
         concentrations of credit risk, as defined in SFAS No. 105, "Disclosure
         of Information about Fair Value of Financial Instruments with
         Off-Balance Sheet Risk and Financial Instruments with Concentrations of
         Credit Risk," consists primarily of cash and cash equivalents, advances
         to affiliate, trade accounts receivable. The Company maintains its cash
         and cash equivalents in major, creditworthy financial institutions and
         has not experienced any losses on its deposits. The Company's
         receivables do not represent a significant concentration of credit risk
         at December 31, 2000 and 1999.

         OIL AND GAS REVENUES

         Oil and gas revenues are recorded under the sales method. The Company
         recognizes oil and gas revenues as production occurs. As a result, the
         Company accrues revenue relating to production for which the Company
         has not received payment.

         EARNINGS PER SHARE

         On January 1, 1998, the Company adopted SFAS No. 128. SFAS 128 provides
         for calculation of "Basic" and "Diluted" earnings per share. Basic
         earnings per share includes no dilution and is computed by dividing net
         income available to common shareholders by the weighted average common
         shares outstanding for the period. Diluted earnings per share reflect
         the potential dilution of securities that could share in the earnings
         of an entity similar to fully diluted earnings per share.

         STOCK BASED COMPENSATION

         The Company accounts for stock issued for compensation in accordance
         with APB 25, "Accounting for Stock Issued to Employee." Under this
         standard, compensation cost is the difference between the exercise
         price of the option and fair market of the underlying stock on the
         grant date. In accordance with SFAS No. 123, "Accounting for Stock
         Based Compensation," the Company provides the pro forma effects on net
         income and earnings per share as if compensation had been measured
         using the "fair value method" described therein.

                                      F-10

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

         INCOME TAXES

         The Company accounts for income taxes in accordance with SFAS No. 109,
         "Accounting for Income Taxes," which requires recognition of deferred
         tax liabilities and assets for the expected future tax consequences of
         events that have been included in the financial statements or tax
         returns. Under this method, deferred tax liabilities and assets are
         determined based on the difference between the financial statements and
         tax basis of assets and liabilities using enacted tax rates in effect
         for the year in which the differences are expected to reverse.

         COMPREHENSIVE INCOME

         Effective January 1, 1998, the Company adopted SFAS No. 130, "Reporting
         Comprehensive Income" (SFAS 130), which was issued in June 1997. SFAS
         130 establishes rules for the reporting and display of comprehensive
         income and its components, but had no effect on the Company's net
         income (loss) or total stockholders' equity. SFAS 130 requires
         unrealized gains and losses on the Company's available-for-sale
         securities, which prior to adoption were reported separately in
         stockholders' equity, to be included in comprehensive income.

         NEW ACCOUNTING PRONOUNCEMENTS

         DERIVATIVE AND HEDGING ACTIVITIES. - In June 1998, the FASB issued SFAS
         No. 133, "Accounting for Derivative Instruments and Hedging Activities"
         ("SFAS 133"). SFAS 133 requires companies to recognize all derivatives
         contracts as either assets or liabilities in the balance sheet and to
         measure them at fair value. SFAS 133 is effective for all fiscal
         quarters of fiscal years beginning after June 15, 2000. There was no
         effect to the financial statements as a result of the adoption of SFAS
         133.

                                      F-11

<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

(2)     ACQUISITIONS

Effective October 5, 2000, the Company issued 2,000,000 shares of its restricted
common stock for all of the outstanding stock of Mass Energy, Inc., a Houston
Texas based oil and gas exploration company. The acquisition was accounted for
using the purchase method of accounting with the purchase price allocated to the
acquired assets and liabilities based on their respective estimated fair values
at the acquisition date. Such allocations were based on evaluations and
estimations. A valuation adjustment in the amount of $2,508,934 had been
assigned to the value of existing unproved oil and gas properties.

      The purchase allocation is summarized as follows:
<TABLE>
<S>                                                <C>
      Current assets                               $     848,585
      Noncurrent assets                                  198,500
      Oil and gas properties                           3,458,696
      Other property and equipment, net                   16,075
      Current liabilities                            (1,771,856)
                                                       ---------
                                                    $  2,750,000
</TABLE>

     The following presents the unaudited pro forma results of operation of
     Pangea for the years ended December 31, 2000, 1999 and 1998, as if the
     purchase transactions would have been consummated as of January 1, 2000,
     1999 and 1998.
<TABLE>
<CAPTION>
                                                       DECEMBER 31,
                                        2000              1999            1998
                                        ----              ----            ----
<S>                                  <C>             <C>             <C>
Pro forma sales                      $         --    $    835,207    $  2,335,778

Pro forma operating income (loss)    $ (5,830,791)   $   (655,326)   $    514,038
Pro forma net loss applicable to
    common shareholders              $ (6,416,583)   $   (800,311)   $  (310,735)

Pro forma basic and diluted net
     loss per share                  $       (.24)   $       (.04)   $      (.02)

Weighted average shares

     outstanding                       25,947,941      19,784,313      19,720,333
                                     ============    ============      ==========
</TABLE>


         Effective April 26, 2000, the Company acquired 100% of the outstanding
         stock of Segway II Corp. (Segway) in exchange for $54,250 in cash and a
         note payable in the amount of $25,000. The only asset Segway had on the
         acquisition date was $500 in cash and the fact that Segway was a 1934
         Exchange Act reporting company in good standing with the SEC.
         Therefore, the Company recorded the acquisition by expensing $78,750 of
         acquisition costs.

         On June 7, 1999, the Company acquired the net assets of Worldlink USA,
         Inc from the Federal Bankruptcy Court of the Southern District of Texas
         in consideration of $162,000 in cash and the assumption of $74,000 in
         liabilities. The assets acquired included the trade name, all
         intellectual properties, and equipment. During the fourth quarter of
         1999, the Company considered its investment in Worldlink to be a
         failure; therefore, all remaining assets acquired were written-off in
         1999 as impaired.

                                      F-12

<PAGE>

(3)      PROPERTY AND EQUIPMENT

         A summary of property and equipment is as follows:
<TABLE>
<CAPTION>
                                                             December 31,
                                                         2000           1999
                                                         ----           ----
<S>                                                 <C>             <C>
      Unproved properties                           $ 2,426,839     $  74,550
      Machinery and equipment                           153,026        15,245
                                                     ----------        ------
                                                      2,579,865        89,795

      Less accumulated depreciation,
         depletion and amortization                     139,419         12,774
                                                     ----------         ------
              Net property and equipment            $ 2,440,446      $  77,021
                                                      =========         ======
</TABLE>
                                        F-13
<PAGE>

                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

(4)      INVESTMENT IN AFFILIATE

         Effective September 7, 2000, the Company entered into an agreement with
         Paradigm Advanced Technologies, Inc., a Delaware Corporation
         (Paradigm), whereby the Company and Paradigm will both own a 50%
         interest in WorldLink USA, LLC, a Nevada Limited Liability Company
         (WorldLink). WorldLink is a development stage company that owns or
         licenses video streaming technology and a library of concerts
         previously broadcast over the Internet. In consideration for the 50%
         ownership in WorldLink, the Company issued warrants representing the
         rights to purchase 12,500,000 shares of Pangea's common stock, par
         value $0.001 per share, at an exercise price of $1.00 per share. The
         warrants may be exercise on the second anniversary of the date of
         issuance. These warrants were valued at $0.01 per share or $125,000.

(5)      INCOME TAXES

         A reconciliation of income taxes at the federal statutory rate to
         amounts provided for the years ended December 31, are as follows:
<TABLE>
<CAPTION>
                                                                          December 31,
                                                                          ------------
                                                                2000          1999         1988
                                                                ----          ----         ----
<S>                                                       <C>              <C>            <C>
              Computed at the statutory rate              $ (2,211,000)    $ (237,000)    $(1,000)

              Change in valuation allowance                  2,211,000        237,000       1,000
                                                              ---------       -------     --------

                      Provision for income taxes          $          -     $        -     $     -
                                                          =============    ===========    ========
</TABLE>

         The Company follows Statement of Financial Accounting Standards No. 109
         (SFAS 109), ACCOUNTING FOR INCOME TAXES. Deferred income taxes reflect
         the net effect of (a) temporary difference between carrying amounts of
         assets and liabilities for financial purposes and the amounts used for
         income tax reporting purposes, and (b) net operating loss
         carryforwards. The cumulative tax effect at the expected rate of 34% of
         significant items comprising the Company's net deferred tax amounts as
         of December 31, 2000 and 1999 are as follows:
<TABLE>
<CAPTION>
                                                                December 31,
                                                               ------------
                                                           2000             1999
                                                           ----             ----
<S>                                                   <C>               <C>
      Deferred tax assets attributable to:
          Net operating loss carryforwards            $  2,449,000      $  238,000
          Less valuation allowance                      (2,449,000)       (238,000)
                                                         ---------         --------
              Deferred tax assets                     $          -      $         -
                                                      =============     ===========
</TABLE>
                                       F-14

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998


         At December 31,2000, the Company provided a 100% valuation allowance
         for the deferred tax assets because it could not be determined whether
         it was more likely than not that the deferred tax asset would be
         realized.

         At December 31, 2000, the Company had net operating loss carryovers of
         approximately $7,203,000. Such carryovers expire at December 31, 2020.

(6)      RELATED PARTY TRANSACTIONS

         During 2000, the Company converted $689,671 of the Company's debt to
         related parties to equity by issuing 3,460,133 shares of the Company's
         common stock. Interest expense in the amount of $622,449 was recorded
         to compensate for the difference between the amount of debt retired and
         market value of the stock issued.

         During 2000, the Company issued 2,944,122 shares of the Company's
         common stock to compensate employees and consultants for services
         performed. Contractual services in the amount of $2,945,715 were
         recorded for the issuance of the common stock (see Note 8 for
         additional shares issued for stock options).

         At December 31, 2000, the Company had notes receivable due from a Board
         member (President of Mass Energy, Inc.) in the amount of $159,000. The
         Company recognized approximately $2,500 in interest income during the
         three months ended December 31, 2000 in association with the note
         receivable. Approximately $150,000 of the balance is evidenced by a
         promissory note. Under the note, interest accrues on the unpaid
         principal at 6.25% per annum. In addition, the president of Mass
         Energy, Inc. is required to maintain term life insurance payable to the
         Company in an amount sufficient to pay the principal and accrued
         interest in full in the event of the subsidiary president's death.

(7)      SECURITIES PURCHASE AGREEMENTS

         In December 2000, the Company entered into a Securities Purchase
         Agreement (the Agreement) whereby the Company issued (in December 2000)
         12,650,000 shares of restricted common stock to an escrow agent (the
         Escrowed Shares) for the benefit of four investor groups in exchange
         for $1,300,000 in cash. The terms of the Agreement required the Company
         to file a Registration Statement with the Securities and Exchange
         Commission (SEC) to register the Escrowed Shares (removing the
         restrictions). The Registration Statement (SEC Form S-1) was filed
         with the SEC on February 8, 2001. The terms of the Agreement are as
         follows:

                                      F-15

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

<TABLE>
<CAPTION>

                                                                     Maximum          Maximum
                                                        Purchase      Amount         Amount of
           Purchaser                                      Price      of Shares        Warrants
           ---------                                      -----      ---------
<S>                                                <C>               <C>              <C>
           Generation Capital Associates           $    600,000      1,600,000        3,450,000  A Warrants
                                                                                      3,450,000  B Warrants

           STL Capital Partners, LLC                     250,000        666,667       1,333,333  A Warrants
                                                                                      1,333,333  B Warrants

           Greenwood Partners, L.P.                      200,000        533,333       1,066,666  A Warrants
                                                                                      1,066,666  B Warrants

           The Apmont Group, Inc.                       2 50,000        550,000        1,100,000 C Warrants
                                                                                       1,100,000 D Warrants

           Escrow Agent Fee                                                               75,000 A Warrants
                                                                                          75,000 B Warrants

                Total                              $ 1,300,000       3,350,000        5,924,999  A Warrants
                                                     =========       =========        =========
                                                                                      5,924,999  B Warrants

                                                                                      1,100,000  C Warrants

                                                                                      1,100,000  D Warrants

</TABLE>

         Each A Warrant has a maximum exercise price of $0.75 and a minimum
         exercise price of $0.05. If the Registration Statement is not declared
         effective by April 13, 2001, the exercise price will be $0.375. The
         Company can purchase or call the A Warrants at $0.05 per warrant on 30
         days notice if the Company's common stock has a closing bid price of at
         least $2.75 for 20 consecutive trading days after the Registration
         Statement is declared effective by the SEC.

                                     F-16

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998


         Each B Warrant has an exercise price of $1.75. If the Registration
         Statement is not declared effective by April 13, 2001, the exercise
         price will be $0.375.

         Each C Warrant has maximum exercise price of $1.00 and a minimum
         exercise price of $0.05. If the Registration Statement is not declared
         effective by April 27, 2001, the exercise price will be $0.50. The
         Company can purchase or call the C Warrants at $0.05 per warrant on 30
         days notice if the Company's common stock has a closing bid price of at
         least $2.75 for 20 consecutive trading days after the Registration
         Statement is declared effective by the SEC.

         Each D Warrant has an exercise price of $1.75. If the Registration
         Statement is not declared effective by April 27, 2001, the exercise
         price will be $0.50.

         The Agreement provide that if the average bid price of the Company's
         common stock is less than $0.50 for the 30 days commencing on the
         earlier of the effective date of the Registration Statement or 105 days
         from the first traunch closing date (specifically, the first traunch
         closing date was December 29, 2000), the A Warrants and B Warrants both
         become "cashless" with a strike price of $0.01. In addition, the
         Agreement provide that if the average bid price of the Company's common
         stock is less than $0.50 for the 30 trading days commencing on the
         earlier of the effective date of the Registration Statement or 105 days
         from the closing date (closing date is February 8, 2001), the C
         Warrants and D Warrants both will become "cashless" with a strike price
         of $0.01.

         In addition to the stock purchase agreements noted above, the Company
         issued an additional 2,405,645 shares of restricted common stock
         through various private placements during 2000.

(8)      STOCK BASED COMPENSATION

         In fiscal 1999, the Company adopted a concept of awarding stock options
         to key employees and outside directors of the Company. The concept
         surrounding the idea of awarding stock options is to increase the
         ownership of common stock of the Company by those key employees and
         outside directors who contribute to the continued growth, development
         and financial success of the Company and its subsidiaries, and to
         attract and retain key employees and reward them for the Company's
         future profitable performance.

         The options granted might be either incentive stock options under the
         Internal Revenue Code or options, which do not qualify as incentive
         stock options. Options are granted for a period of up to three years.
         The options granted under this plan were fully vested at grant date.

                                     F-17

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

         On January 25, 2000, the Company's Board of Directors authorized and
         issued a total of 125,000 shares at an exercise price of $0.5. In
         addition, the employment agreements for senior management are in
         effect, the Company authorized and issued a total of 987,500 shares at
         an exercise price of $0.50 for compensation. On October 5, 2000, the
         Company's Board of Directors authorized and issued a total of 25,000
         shares at an exercise price of $1.00 for contractual services. On
         November 14, 2000, the Company's Board of Directors authorized and
         issued a total of 275,000 shares at an exercise price of $1.00 for
         investor relations. On November 2, 2000, the Company's Board of
         Directors authorized and issued a total of 2,450,000 shares at an
         exercise price ranging from $2.00 to $5.00 for compensation.

         On June 3, 1999 the Company's Board of Directors authorized and issued
         a total of 10,000 shares at an exercise price of $5.00 for investor
         relations. On August 11, 1999 the Company's Board of Directors
         authorized and issued a total of 10,000 shares at an exercise price of
         $1.00 for compensation. The Company's Board of Directors authorized and
         issued a total of 250,000 shares at an exercise price of $0.50 for
         compensation. In addition, the employment agreements for Sr. management
         are in effect, the Company authorized and issued a total of 650,000
         shares at an exercise price of $1.00 for compensation. The Company
         issued no stock options during 1998.

         The Company applies Accounting Principles Board Opinion Number 25 in
         accounting for options and accordingly recognized no compensation cost
         for its stock options in 2000 or 1999. The following reflect the
         Company's pro-forma net loss and net loss per share had the Company
         determined compensation costs based upon fair market values of options
         at the grant date, as well as the related disclosures required by SFAS
         123.
<TABLE>
<CAPTION>
                                                         Weighted
                                                         Average
                                                         Exercise
                                              Options    Price
                                              -------    -----
<S>                                           <C>     <C>
Balance outstanding at January 1, 1999             --       --
   Issued                                     920,000 $   0.91

   Exercised                                       --       --
   Cancelled                                       --       --
   Expired                                         --       --
                                                -----    -----
Balance outstanding at December 31, 1999      920,000 $   0.91
                                           ---------- --------
</TABLE>

                                  F-18

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998
<TABLE>
<CAPTION>
                                                         Weighted
                                                         Average
                                                         Exercise
                                              Options    Price
                                              -------    -----
<S>                                        <C>           <C>
   Issued                                   3,862,000    $   2.97

   Exercised                               (1,156,000)   $   0.97

   Cancelled                                 (350,000)   $   4.14

   Expired                                    (20,000)   $   3.00

Balance outstanding at December 31, 2000    3,256,500    $   2.97
                                           ==========    =====
</TABLE>

         The Company was required to adopt the disclosure portion of SFAS No.
         123. This statement requires the Company to provide pro forma
         information regarding net loss applicable to common stockholders and
         loss per share as if compensation cost for the Company's stock options
         granted had been determined in accordance with the fair value based
         method prescribed in SFAS 123. The Company estimates the fair value of
         each stock option at the grant date by using the Black-Scholes
         option-pricing model with the following weighted-average assumptions
         used for grants in 2000 and 1999 as follows:
<TABLE>
<CAPTION>
                                             December 31
                                      2000         1999
<S>                                 <C>         <C>
 Dividend yield                          0%          0%
 Expected volatility                   185%        169%
 Risk free interest                   53.6%       48.7%
 Expected lives                     3 years     3 years
</TABLE>

         The following table summarizes information about fixed stock options to
         employees outstanding at December 31, 2000:
<TABLE>
<CAPTION>
                                                    Weighted
                                                     Average
                             Number               Remaining
                     Outstanding and             Contractual
                      Exercisable at           Life (Years) at
     Exercise         December 31,             December 31,
     Price                 2000                      2000
<S>  <C>                    <C>                          <C>
     $  .50                   250,000                    2.80
     $ 1.00                   906,500                    2.80
     $ 2.00                   600,000                    2.80
     $ 5.00                 1,500,000                    2.80
     $.5 - 5.00             3,256,500                    2.80
</TABLE>

                                   F-19

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

         The Black Scholes option valuation model was developed for use in
         estimating the fair value of traded options, which have no vesting
         restrictions and are fully transferable. In addition, option valuation
         models require the input of highly subjective assumptions including the
         expected stock price volatility. Because the Company's employee stock
         options have characteristics significantly different from those of
         trade options, and because changes in the subjective input assumptions
         can materially affect the fair value estimate, in management's opinion,
         the existing models do not necessarily provide a reliable single
         measure of the fair value of its employee stock options.

         Pro-forma net income and earnings per share had the Company accounted
         for its options under the fair value method of SFAS 123 is as follows:
<TABLE>
<CAPTION>
                                        2000            1999            1998
                                        ----            ----            ----
<S>                              <C>               <C>            <C>
Net loss as reported             $   (6,502,646)   $  (695,769)   $    (3,362)

Adjustment required by SFAS 123      (3,642,303)      (892,044)             --
                                  -------------    -----------    -----------
Pro-forma net loss               $  (10,144,949)   $(1,587,813)   $    (3,362)
                                     ===========   ===========    ============
Loss per share:
   As reported                    $        (.27)   $      (.04)   $      (.00)

Pro-forma net loss per share:
  Basic and diluted               $           (.42)$      (.09)   $      (.00)
</TABLE>

(9)      REPORTABLE SEGMENTS

         Pangea has only one reportable segment, Mass Energy, Inc. (MEI), which
         it acquired on October 5, 2000. During the three months ended December
         31, 2000, MEI operated in only one geographical area. MEI reported no
         revenues from the acquisition date to December 31, 2000.

         All of the Companies assets are held within the United States and all
         material revenue was generated within the United States.

                                     F-20

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998

(10)     COMMITMENTS AND CONTINGENCIES

         Commitments: The Company leases corporate office facilities. The
         Company previously leased these corporate facilities under a one-year
         lease agreement that ended December 31, 1999. Under this agreement, the
         monthly lease payment was approximately $2,300. Total rent expense was
         $19,900 and $0 in 1999 and 1998, respectively.

         Contingencies: The Company is involved in various legal proceedings
         arising in the normal course of business. In the opinion of management,
         the Company's ultimate liability, if any, in these pending actions
         would not have a material adverse effect on the financial position,
         operating results or cash flow of the Company.

(11)     LIQUIDITY

         The Company incurred a significant operating loss in 2000.
         Approximately 75% of the loss was due to non-cash operating expenses
         (e.g., issuance of common stock for services). Cash operating expenses,
         primarily energy projects, were funded by the completion of a long-term
         equity financing package, various private placements of restricted
         common stock and exercise of stock options by the Company officers.
         Management believes that funds will be available to finance current and
         future energy projects and to finance other operating costs over the
         next twelve months.

(12)     RESTATEMENT

         The Company's financial statements for the year ended December 31, 2000
         have been restated to properly reflect transactions related to employee
         stock options and to correct classification of other common stock
         transactions.

         The effects of the restatement is a follows:
<TABLE>
<CAPTION>
                                              As Previously                            As
                                                 Reported            Changes        Restated
                                                 --------            -------        --------
<S>                                         <C>              <C>               <C>
         Consolidated Balance Sheet:
           Investment in affiliate          $       12,500   $     112,500     $      125,000

           Additional paid-in capital           10,482,239         428,524         10,910,763

           Accumulated deficit                 (6,901,696)        (316,024)       (7,217,720)
                                               ==========         ========       ============
</TABLE>

                                   F-21

<PAGE>
                   PANGEA PETROLEUM CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         December 31, 2000,1999 and 1998
<TABLE>
<CAPTION>
<S>                                                 <C>                  <C>              <C>
         Consolidated Statements of Operations:
           Total operating expenses                 5,601,330            204,920          5,806,250

           Interest expense                           511,495            111,104            622,599

           Net loss per share                           (.25)              (.02)              (.27)
                                             ================         ==========         ==========
</TABLE>

                                   F-22

<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
-------------------------------------------------------------------------------

The following is a discussion of our financial condition, results of operations,
liquidity and capital resources. This discussion should be read in conjunction
with our Consolidated Financial Statements and the notes thereto included
elsewhere in this Form 10-K.

General

Pangea operated as a development stage company investing in a number of small
oil and gas projects and through its Internet affiliate, Worldlink USA of 2000.
Paradigm became the active partner in that operation after the sale. Pangea
received 7,300,000 shares of Paradigm stock for the Worldlink asset as well as
12,500,000 Paradigm warrants with an exercise price of $1.00. In addition to the
Worldlink asset, Pangea also awarded Paradigm 12,500,000 warrants with an
exercise price of $1.00. The results of the Company's prior investments in small
oil and gas projects have not resulted in a positive cash flow; however, work
continues on two of these projects.

Pangea, through its affiliate Mass Energy, has undertaken to develop two oil and
gas projects in 2000 and completed negotiations to acquire the rights to a third
project. A discovery well was drilled on Pangea's Starr County, Texas project
but, to date, this well has not resulted in any commercial oil or gas
production. However, the field remains under evaluation for the drilling of
additional wells at a later time. Drilling on the Company's Jackson County,
Texas project was started in the last quarter of 2000. The discovery well for
this project is currently being drilled. The third project in California is now
under development.

Results of Operations

Currently, the Company has not obtained any revenue from its oil and gas
investments; however, it is expected that cash flow should start by the middle
of 2000. The completion of the wells on existing leases and newly acquired
prospects (i.e. Kern County, CA) will require substantial capital investments
before production is realized.

Comparison of Year Ended December 31, 2000 to Year Ended December 31, 1999.

The increased loss that is shown in year 2000 results as compared to year end
1999 results is directly attributed to the re-organization and sale of a portion
of the WorldLink USA asset, the Mass Energy acquisition, the finalization of a
long term financing package for energy development projects and the greatly
increased level of energy project spending. Early in 2000, the Company exchanged
debt for equity with a major shareholder in order to clean up the WorldLink
subsidiary. One half of that asset was then sold to Paradigm for an equity
position in their company. The Mass Energy acquisition completed in the fourth
quarter positioned the Company for operational control of two existing projects
and ownership of valuable leases in East and South Texas. Very late in 2000, we
committed a substantial equity position in the Company in order to secure a long
term financing package from several groups that will enable us to move forward
in an expeditious manner on several energy projects. Finally, spending on
existing energy projects that are expected to bear fruit accelerated in the
third and fourth quarters.

Comparison of Year Ended December 31, 1999 to Year Ended December 31, 1998.

                                    II-3
<PAGE>

The Company in 1998 was still in a development stage with essentially no active
projects. In 1999, we largely focused on the WorldLink operations and one small
energy project. As noted above, losses associated with WorldLink were
consolidated in early 2000 in order to position that activity for sale. The
Company was still in the development stage and we expected to incur losses until
our energy projects and acquisitions were completed and WorldLink was sold.

Liquidity and Capital Resources

The Company completed a long term financing package on December 29, 2000. The
funds available to the Company under this package will be used to develop the
Jackson County, Texas project and to start drilling on the Kern County,
California project. The Company was able to fund years 2000 projects and start
2001 with capital received from investors and the long term financing package
described above. The Company was essentially debt free as of December 31, 2000.

2001 Outlook

The Company is positioned to complete the Jackson County, Texas project, to
start the Kern County, California project and to renew operations in Starr
County, Texas with funds-in-hand or committed to us for use in the next few
months. One of the major challenges that is creating delays in project
completion, is availability of drilling and related service equipment due to
tight demand within the industry.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk represents the risk of loss that may impact our financial position,
results of operations or cash flows due to adverse changes in market prices and
rates. We are exposed

to market risk because of changes in foreign currency exchange rates as measured
against the U.S. dollar. We do not anticipate that near-term changes in exchange
rates will have a material impact on our future earnings, fair values or cash
flows. However, there can be no assurance that a sudden and significant decline
in the value of European currencies would not have a material adverse effect on
our financial conditions and results of operations.

Our short-term bank debt bears interest at variable rates; therefore our results
of operations would only be affected by interest rate changes to the short-term
bank debt outstanding. An immediate 10 percent change in interest rates would
not have a material effect on our results of operations over the next fiscal
year.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements of the Company, together with the report of auditor's
are included in this report under Item 6 herein.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

The Company's accountant is R. E. Bassie & Co., P.C. of Houston, Texas. The
Company does not presently intend to change accountants. At no time has there
been any disagreements with such accountant regarding any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure. The Company's previous accountant was James J. Taylor, CPA of New
Braunfels, Texas. At no time has there been any disagreements with such
accountant regarding any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure.

                                       II-4
<PAGE>
                                    PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS:
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

The directors and officers of the Company and its subsidiary, as of April 10,
2001, are set forth below. The directors hold office for their respective term
and until their successors are duly elected and qualified. Vacancies in the
existing Board are filled by a majority vote of the remaining directors. The
officers serve at the will of the Board of Directors.

                                   MANAGEMENT

Directors and Executive Officers

Set forth below are the names, ages, years of service and positions of the
executive officers and directors of Pangea.
<TABLE>
<CAPTION>
Name                                 Age             Office
-------                             ------           --------

<S>                                 <C>              <C>
Charles B. Pollock                  61               Chief Executive Officer and Chairman of  the
                                                     Board of Directors
David H. Lennox                     64               President and Director
Randall W. Massey                   46               Chief Operating Officer and President, Chief
                                                     Executive Officer and Secretary of Mass
                                                     Energy
Mary E. Pollock                     34               Senior Vice President
Edward R. Skaggs                    35               Director
Scott Massey                        46               Chief Financial Officer of Mass Energy
</TABLE>

CHARLES B. POLLOCK, 61, was appointed the Chief Executive Officer and Chairman
of the Board of the Company in June 1999. From January 1994 to September 1995,
Mr. Pollock was President of Praxair Indonesia, an industrial gas company where
his responsibilities were those as Chief Executive Officer of such company. From
October 1995 to August 1996, he was manager of Praxair, Inc., an industrial gas
company. His responsibilities included strategic marketing and competition
analysis. From September 1996 to May 1999, Mr. Pollock was self-employed as a
consultant in which his projects included the acquisition and sale of
businesses, competitive anlysis and strategic marketing. Mr. Pollock received
his Bachelor of Science degree in 1962 from North Carolina State University, his
Master of Science degree in Ceramic Engineering from North Carolina State
University in 1968 and his PhD in Material Engineering from North Carolina State
University in 1972.

DAVID H. LENNOX, 64, was appointed the President and a Director of the Company
in January 2000. Mr. Lennox has over 20 years management experience in the
construction industry. Since January 1976, Mr. Lennox has been President of
Legend Construction where his responsibilities include the day-to-day operations
of such Company. Mr. Lennox received his Bachelor's Degree from Lehigh
University in 1962 and his Masters of Science Degree in Operations Research from
Lehigh University in 1966.

                                   III-1
<PAGE>

RANDALL W. MASSEY, 46, was appointed as Chief Operating Officer and a Director
of the Company in October 2000. Mr. Massey began his career in the oil industry
in 1980 as an independent landman. In 1984, he joined a small E & P Company,
Natural Energy, Inc., as Vice President where he concentrated on deal making and
the associated financing. He established M & R Exploration in 1989, where he
served as President. This company grew through exploration and field
acquisitions to more than $30 million in assets. In 1997, Mr. Massey sold this
company, with the remaining company being Mass Energy. Since such time, Mr.
Massey has operated such company. Mr. Massey graduated from the University of
Houston in 1979 with a Bachelor of Science Degree in Pharmaceutical Sciences.

MARY E. POLLOCK, 34, was appointed as Senior Vice President of the Company on
January 22, 2001. Ms. Pollock has over 12 years experience in Human Resources,
Marketing and General Administration in small high growth companies in a variety
of industries. She has additional expertise in managing the administrative
functions during mergers and acquisitions of a company. She started her career
at the law firm of Bondurant, Mixson & Elmore in 1989 as a Human Resources
Generalist where she obtained a solid background in employment law. She then
joined Randstad Staffing Services in 1994 where she held a variety of positions
including Business Development Manager, Communications Manager and Human
Resources Manager. She joined Sunworthy Wallcovering in January 1997 as the
Director of Human Resources, North America and was an important part of their
transition team after its acquisition in the first quarter of 1999. She joined
Porsche Cars North America in March of 1999 as Porsche was relocating their
corporate headquarters to Atlanta, Georgia as the Human Resources Manager, North
America. Ms. Pollock graduated from Emory University in 1984 with a Bachelor of
Arts in English.

EDWARD R. SKAGGS, was appointed to the Board of Directors of the Company on
December 18, 2000. Mr. Skaggs has over 10 years of experience in investigations
and security. In addition, he has extensive experience in retail management
specifically dealing in personnel issues and security matters. Mr. Skaggs
started his career as an Assistant District Manager for EZ Mart Store in 1988.
In June 1991, he left EZ Mart to form an investigative consulting firm, Skaggs &
Associates, Inc. where he continues to work. He received a Bachelor of Arts
degree in Political Science from Texas Tech University in 1992.

C. SCOTT MASSEY, 48, was appointed as Chief Financial Officer of Mass Energy on
January 9, 1989. Mr. Massey received a Bachelor of Business Administration
degree in Accounting from the University of Texas in 1974 and a law degree from
the University of Houston in 1977. Mr. Massey started his career working for
KPMG Peat Marwick in 1977 and took early retirement in 1998, after 13 years as a
Partner. During the years that he worked for KPMG, ten of those were in the
Houston Office (Oil and Gas Group). Mr. Massey was the lead Partner for Murphy
Oil and Crystal Oil Co. while at KPMG and was also on the Board of Directors at
Applied Snubbing Technology (Cudd Pressure Control). Since 1998, Mr. Massey has
operated a private accounting firm based in Shreveport, Louisiana.

                                      III-2
<PAGE>

The Directors named above will serve until the next annual meeting of the
shareholders of the Company in the year 2001. Directors will be elected for
one-year terms at each annual shareholder's meeting. Officers hold their
positions at the appointment of the Board of Directors.

COMMITTEES OF THE BOARD

We presently do not have any committees.

All officers and directors listed above will remain in office until the next
annual meeting of our stockholders, and until their successors have been duly
elected and qualified. There are no agreements with respect to the election of
Directors. We have not compensated our Directors for service on our Board of
Directors, any committee thereof, or reimbursed for expenses incurred for
attendance at meetings of our Board of Directors and/or any committee of our
Board of Directors. Officers are appointed annually by our Board of Directors
and each Executive Officer serves at the discretion of our Board of Directors.
We do not have any standing committees. Our Board of Directors may in the future
determine to pay Directors' fees and reimburse Directors for expenses related to
their activities.

None of our Officers and/or Directors have filed any bankruptcy petition, been
convicted of or been the subject of any criminal proceedings or the subject of
any order, judgment or decree involving the violation of any state or federal
securities laws within the past five (5) years.

CERTAIN LEGAL PROCEEDINGS

No director, nominee for director, or executive officer of the Company has
appeared as a party in any legal proceeding material to an evaluation of his
ability or integrity during the past five years.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

We filed Form 3's for the following: Randall W. Massey - October 27, 2000;
Charles B. Pollock, David H. Lennox, Karen Cloud, Martin Nathan and Bruce
Pollock - all on August 4, 2000. Such Form 3's were filed late. We are still
obligated to file additional Form 3's for transactions that occurred in 2000 and
intend to file same in the near future. A Form 5 will not be filed for our year
ended December 31, 2000 since all reportable transactions for such fiscal year
were reported on Form 3's filed with the Commission or will be filed on Form 3's
in the near future with the Commission.

                                       III-3
<PAGE>

ITEM 11. EXECUTIVE COMPENSATION

Compensation Summary

The following table sets forth a summary of compensation for the fiscal years
ended December 31, 1998, 1999, 2000 and 2001 paid by us to Charles B. Pollock,
our Chairman of the Board and Chief Executive Officer; David Lennox, our
President; Karen Cloud, our former Secretary; Mary E. Pollock, Senior Vice
President, Edward R. Skaggs, Board Member and Randall W. Massey (paid by Mass
Energy)
<TABLE>
<CAPTION>
                           SUMMARY COMPENSATION TABLE
                                                                                             Long Term
                                                           Annual Compensation           Compensation Awards
Name and Principal                                     ---------------------------           Options/SARs
Position                                    Year      Salary ($)             Bonus (1)         (#)
------------------------                    ------    -----------            ----------  ------------------
<S>                                         <C>         <C>               <C>              <C>
Charles  B. Pollock                         1998        N/A               N/A              N/A
CEO and Chairman of Board                   1999        $28,000 (2)       50,000 (3)       370,000 (4)
                                            2000        $51,000 (2)       100,000 (3)      620,000 (4)
                                                                                           200,000(6)
                                                                                           500,000(7)
                                            2001        $60,000(5)        200,000          650,000
                                                                          options (4)      options (4)

Randall W. Massey                           1998        N/A               N/A              N/A
COO and Director                            1999        N/A               N/A              N/A
President of Mass Energy                   2000         $15,000           50,000 (4)       95,000(4)
                                                                                           200,000(6)
</TABLE>


                                        III-4
<PAGE>
<TABLE>
<S>                                         <C>         <C>               <C>              <C>
                                                                                           500,000(7)

                                            2001        $60,000           200,000(4)       350,000(4)

Karen Cloud                                 1998        N/A               N/A              N/A
Former Secretary                            1999        $19,500           25,000 (3)       6,000 (4)
                                            2000        $39,000           75,000 (4)       15,000 (4)
                                                                                           100,000(6)
                                                                                           250,000(7)

David H. Lennox                             1998        N/A               N/A              N/A
President and Director                      1999        N/A               50,000 (3)       20,000 (4)
                                            2000        $42,000           100,000 (3)      350,000 (4)
                                                                                           200,000(6)
                                                                                           500,000(7)

                                            2001        $60,000           250,000          350,000
                                                                          options (4)      options (4)

Mary E. Pollock                             1998        N/A               N/A              N/A
Senior Vice President                       1999        N/A               N/A              N/A
                                            2000        N/A               N/A              N/A
                                            2001        $60,000 (5)       100,000          300,000
                                                                          options (4)      options (4)

Edward R. Skaggs                            1998        N/A               N/A              N/A
Board Member                                1999        N/A               N/A              N/A
                                            2000        N/A               N/A              50,000
                                                                                        options (4)
                                            2001        N/A               N/A              50,000
                                                                                           options (4)
</TABLE>

(1) All bonus payments are made in grants of Pangea Stock Options.

(2) $24,000 in cash, balance in S-8 and restricted stock. Non-cash will be paid
in Pangea stock at the rate of $1.00 per share for S-8 shares and $.35 per share
of 144 restricted shares.

(3) Pangea Stock Options with an exercise price of $.50 per share.

(4) Pangea Stock Options with an exercise price of $1.00 per share.

(5) Salary is in a combination of cash and Pangea Stock at rates of $1 for S-8
shares and $.35 for restricted shares.

(6) Pangea Stock Options with an exercise price of $2.00 per share.

                                     III-5
<PAGE>

(7) Pangea Stock Options with an exercise price of $5.00 per share.

Grants of Stock Options and Stock Appreciation Rights During the Fiscal Year
Ended December 31, 2000

The table below contains certain information concerning stock options granted to
Messrs. Pollock, Lennox, Massey and Karen Cloud (formerly our Secretary) during
2000:
<TABLE>
<CAPTION>
                          OPTION GRANTS IN FISCAL YEAR

                            Options        % of Total       Exercise     Expiration Date   Potential Realizable Value at Assumed
                            Granted          Options        Price Per                      Rates of Stock Price Appreciation for
                                           Granted to         Share                         Option Term
Name                                       Employees
------------------------ --------------- ---------------- -------------- ----------------- -------------------------------------
                                                                                                      5%                    10%

<S>                        <C>              <C>      <C>               <C>                  <C>
      C. Pollock           620,000          14.8     $1.00             12/31/03
         (35%)             150,000           3.6     $ .50             12/31/03
                           200,000           4.8     $2.00             11/01/03
                           500,000          11.9     $5.00             11/01/01

       D. Lennox           570,000          13.5     $1.00             12/31/03
        (33.8%)            150,000           3.6     $ .50             12/31/03
                           200,000           4.8     $2.00             11/01/03
                           500,000          11.9     $5.00             11/01/01

       K. Cloud             46,000           1.1     $1.00             12/31/03
        (11.2%)             75,000           1.8     $ .50             12/31/03
                           100,000           2.4     $2.00             11/01/03
                           250,000           6.0     $5.00             11/01/01

       R. Massey           125,000           3.0     $1.00             12/31/03
        (19.7%)            200,000           4.8     $2.00             11/01/03
                           500,000          11.9     $5.00             11/01/01

      J. Wheeler             13,000             .3
</TABLE>


                                       III-6
<PAGE>

The table below contains certain information concerning exercises of stock
options during the fiscal year ended December 31, 2000 by Messrs. Pollock,
Lennox and Ms. Cloud and the fiscal year end value of unexercised options held
by Messrs. Pollock, Lennox, Massey and Ms. Cloud.


  Aggregated Options Exercised in Fiscal 2000 and Fiscal Year End Option Values
<TABLE>
<CAPTION>
Name                 Shares Acquired   Value           Number of Unexercised        Value of unexercised in-the-money options on
                     by Exercise #     Realized $      Options on 12/31/00          12/31/00
                                                       # exer/unexercisable         $exer/unexercisable
-------------------- ----------------- --------------- ---------------------------- --------------------------

<S>                  <C>               <C>             <C>                          <C>
C. Pollock           450,000           $229,000        1,020,000/0
D. Lennox            450,000           $218,000        970,000/0
K. Cloud             121,000           $92,000         350,000/0
R. Massey            75,000            $12,000         750,000/0
J. Wheeler           13,000            0               13,000/0
</TABLE>

Long Term Incentive Plan Awards During the Fiscal Year Ended December 31, 2000
We did not make any awards under a long-term incentive plan during the fiscal
year ended December 31, 2000.

Employment Agreements

We have entered into employment agreements with each of Messrs. Pollock, Lennox
and Massey, and Ms. Pollock. The following sets forth the terms of the
employment agreements:

Charles B. Pollock--On June 1, 1999, we entered into an employment agreement
with Mr. Pollock which ends on December 31, 2002 to act as our Chairman of the
Board of Directors and Chief Executive Officer. Pursuant to the employment
agreement, Mr. Pollock is paid a salary of $4,000 per month plus an option to
purchase 50,000 Pangea S-8 shares per month at an exercise price of $1.00 per
share. In addition, we provide medical benefits for Mr. Pollock. Mr. Pollock
also receives as a bonus three (3%) percent of the net proceeds received by us
upon the successful completion of the sale of any major company assets (major
asset is defined as an asset whose sale price is $500,000 or more).

David H. Lennox--On January 5, 2000, we entered into an employment agreement
with Mr. Lennox which ends on December 31, 2001 to act as our President.
Pursuant to the employment agreement, Mr. Lennox is paid a salary of $3,000 per
month plus an option to purchase 25,000 Pangea shares per month at an exercise
price of $1.00 per share. In addition, we provide medical benefits for Mr.
Lennox. Mr. Lennox also receives as a bonus three (3%)

                                       III-7
<PAGE>

percent of the net proceeds received by us upon the successful completion of the
sale of any major company assets (major asset is defined as an asset whose sale
price is $500,000 or more).

Randall W. Massey--On September 15, 2000, we entered into a two (2) year
employment agreement with Mr. Massey to act as our Chief Operating Officer and
as the President, Chief Executive Officer and Secretary of Mass Energy, Inc.,
our wholly subsidiary. Pursuant to the employment agreement, Mr. Massey is paid
a salary of $5,000 per month plus options to purchase 50,000 Pangea shares on
the execution of the employment agreement. Thereafter, we granted to Mr. Massey
options to purchase 25,000 shares of Pangea Common Stock per month at an
exercise price of $1.00 per share which may be exercised in whole or in part
until expiration, and unexercised options shall expire on the third anniversary
of issuance. If employment is terminated under this agreement before the
expiration of the two year term, Mr. Massey shall retain all options granted and
in addition shall be granted, upon termination, options for a number of shares
of Pangea Common Stock, pro rated to the date of employment termination. In
addition, we provide medical benefits for Mr. Massey. Mr. Massey also receives
as a bonus one (1%) percent of the net proceeds received by us upon the
successful completion of the sale of any major company assets (major asset is
defined as an asset whose aggregate sale price, whether realized from one sale
or a series of related sales, is $500,000 or more).

We also agreed to convey to Mr. Massey a 2% (of 8/8) overriding royalty interest
in leases owned or acquired by him for exploration of oil, gas and other
minerals in the SouthWest El Toro prospect in Jackson County, Texas. In addition
to the foregoing, we also granted to Mr. Massey options to purchase shares of
Pangea Common Stock, with an exercise price of five cents per share and an
expiration date on the fifth anniversary of issuance, for net total proven
reserves (as hereafter defined) resulting from energy projects undertaken by Mr.
Massey, as follows: (1) we shall grant Mr. Massey options to purchase 1,000,000
shares of Pangea Common Stock for the first five billion cubic feet ("BCF")
equivalent of net total proven reserves, (2) we shall grant Mr. Massey options
to purchase an additional 1,000,000 shares of Pangea Common Stock for the second
ten BCF equivalent of net total proven reserves, and (3) thereafter, we shall
grant Mr. Massey options to purchase 1,000,000 shares of Pangea Common Stock for
each additional 25 BCF equivalent of net total proven reserves. For purposes of
the employment, net total proven reserves shall be determined by an independent
third party engineering reserve report from Netherland, Sewell & Associates, or
such other reputable third party engineering service as Pangea and Mr. Massey
may jointly approve in writing; and we shall, at our sole cost and expense,
provide Mr. Massey with such a report not less than once each six months until
all prospects initiated or contemplated during the employment period shall have
been fully completed and reported as herein provided. For purposes of
preparation of the net proven reserves report, the conversion factor shall be
six thousand cubic feet of gas to one barrel of oil. Options shall continue to
be granted to Mr. Massey under this Paragraph 3(e) following the termination of
employment for net proven reserves discovered and reported thereafter until all
projects or prospects begun or

                                       III-8
<PAGE>

contemplated prior to employment termination have been fully completed and
reported.

Mary E. Pollock--we entered into an employment agreement with Ms. Pollock
effective January 8, 2001 and terminating on December 31, 2002 to act as our
Senior Vice President. Pursuant to the Employment Agreement, Ms. Pollock is paid
a salary of $5,000 per month plus options to purchase 25,000 Pangea shares per
month at an exercise price of $1.00 per share. Ms. Pollock can choose to reduce
the cash salary and increase the number of options awarded each month. The
conversion from cash to options will be $1,000 equals 5,000 options.
Additionally, Ms. Pollock received as a signing bonus of 50,000 options to
purchase Pangea shares at an exercise price of $1.00 per share. The selection of
amount of cash versus number of options may be adjusted by Ms. Pollock on a
quarterly basis In addition, we provide medical benefits for Ms. Pollock. Ms.
Pollock also receives a bonus of one (1%) percent of the net proceeds received
by us upon the successful completion of the sale of any major company assets
(major asset is defined as an asset whose sale price is $500,000 or more).

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Based upon information received from the persons concerned, each person known to
us to be the beneficial owner of more than five percent of the outstanding
shares of our Common Stock, each director, each of the named executive officers
and all of our directors and officers as a group, owned beneficially as of April
10, 2001, the number and percentage of outstanding shares of our Common Stock
indicated in the following table:
<TABLE>
<CAPTION>
Name and Address of
Beneficial Owner                    Number of Shares (1) (3)            Percentage (2)
--------------------------          ------------------------------      -----------------
<S>                                       <C>                              <C>
Charles B. Pollock                          200,000                             *
2014 Bonner Bussells Drive
Southport, NC 28461

David H. Lennox                             500,000                         1.06%
P.O. Box 571913
Houston, Texas 77257

Randall Massey                            2,440,000                         5.17%
11410 Ella Lee Lane
Houston, Texas 77077

Mary Pollock                                 10,000                             *
443A Asbury Commons Drive
Dunwoody, Georgia  30338

All Officers and Directors as a           3,150,000                         6.68%

Group (4 persons)

Rapid Release Research, LLC               8,505,677                        18.03%
6666 Harwin Drive, Suite 545
Houston, Texas 77036

Jacob International Inc.                  5,591,000                        11.85%
1980 Post Oak Blvd., Suite 1777
Houston, Texas 77024
</TABLE>

                                       III-9
<PAGE>

*  Less than 1%

(1) Unless otherwise indicated, all shares are held directly with sole voting
and investment power.

(2) Based on 47,370,898 shares of our Common Stock issued and outstanding. This
does not include an additional 600,000 shares of our Common Stock that we are
obligated to issue under certain Securities Purchase Agreements. See (3) below.

(3) To date, we have issued 16,149,998 shares of our Common Stock to David
Rapaport and M. Richard Cutler, as joint escrow agents, in accordance with
certain Securities Purchase Agreements we have executed with Generation Capital
Associates, Greenwood Partners, LP STL Capital Partners, LLC, and The Apmont
Group, Inc. respectively. We will be issuing an additional 600,000 shares to the
escrow agents as our maximum obligation under such Securities Purchase
Agreements. Neither Messrs. Rapaport or Cutler have any beneficial ownership in
any such shares.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
-------------------------------------------------------

On April 26, 2000, we entered into a Stock Acquisition and Reorganization
Agreement with Segway II Corp. (a 1934 Exchange Act reporting company). Based on
this transaction and pursuant to Rule 12g-3(a) of the General Rules and
Regualtions of the SEC, we elected to become the successor issuer to Segway II
Corp. for reporting purposes under the 1934 Exchange Act effective April 26,
2000. Richard I. Anslow, our legal counsel, was a 95% shareholder of Segway II
Corp. and received 4,750 of our shares of Common Stock (Robert S. Jaclin, the
father of Gregg Jaclin, a partner of Anslow & Jaclin, LLP was a 5% shareholder
of Segway II Corp. and received 250 shares). Additional cash consideration of
$75,000 was paid as part of the transaction.

                                       III-10
<PAGE>

                                    PART IV

ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K
------------------------------------------

(a)   The following documents are filed as part of this report:

1.   Financial statements; see index to financial statement and schedules
     in Item 6 herein..

2.   Financial statement schedules; see index to financial statements and
     schedules in Item 6 herein.

3.   Exhibits:

The following exhibits are filed with this Form 10-K and are identified by the
numbers indicated.

3.1  Articles of Incorporation, as amended (1)

3.2  Bylaws, as amended (1)

(1)  Incorporated by reference to the Registrant's Form 8-K12g3 filed on April
     28, 2000 (SEC File No. 0-30503).

(b)  Reports on Form 8-K

We filed a Form 8-K on September 22, 2000 (and an amendment to such Form 8-K on
October 23, 2000) to report the acquisition of Mass Energy Inc.


                                       IV-1
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Act, the undersigned has duly
caused this Form 10-K to be signed on its behalf by the undersigned, there unto
duly authorized, in the City of Houston, Texas, on April 16, 2001.

                           PANGEA  PETROLEUM CORPORATION


                           By: /s/ Charles B. Pollock
                           ---------------------------------------------
                                   Charles B. Pollock, Chairman of the Board,
                                   and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this 10-K has been
signed below by the following persons in the capacities and on the date
indicated.
<TABLE>
<CAPTION>
Signature                     Name and Title                         Date
---------                     -------------                          ----
<S>                           <C>                                    <C>
/s/ Charles B. Pollock        Chairman of the Board of Directors     April 16, 2001
----------------------        and Chief Executive Officer

/s/ Randall W. Massey         Chief Operating Officer and Director   April 16, 2001
---------------------

/s/ David H. Lennox           President and Director                 April 16, 2001
-------------------

/s/ Mary E. Pollock           Senior Vice President                  April 16, 2001
-------------------

/s/ Edward R. Skaggs          Director                               April 16,2001
--------------------
</TABLE>