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

                                    FORM 10-QSB

(Mark One)

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

                    For the quarterly period ended June 30, 2007

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

             For the transition period from _______________ to _______________

             Commission file number:                   000-50559
                                     _________________________________________

                            SCIENTIFIC ENERGY, INC.
------------------------------------------------------------------------------
         (Exact name of small business issuer as specified in its charter)

              Utah                                 87-0680657
------------------------------------------------------------------------------
State or other jurisdiction             (I.R.S. Employer Identification No.)
       of incorporation or organization)

                 27 Weldon Street, Jersey City, New Jersey 07306
------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (201) 985-8100
------------------------------------------------------------------------------
                           (Issuer's telephone number)

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

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


                      APPLICABLE ONLY TO CORPORATE ISSUERS

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

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 4,915,855 shares of common stock, par
value $0.01, as of August 15, 2007.

Transitional Small Business Disclosure Format (check one):  Yes  [ ]   No [X]






                                 SCIENTIFIC ENERGY, INC.



                                   Table of Contents



Part I. Financial Information

Item1.  Financial Statements

     Balance Sheets                                                           3

     Statements of Operations (Unaudited)                                     4

     Statements of Cash Flows (Unaudited)                                     5

     Notes to Unaudited Financial Statements                                6-9

Item 2. Management's Discussion and Analysis or Plan of Operation         10-14

Item 3. Controls and Procedures                                           14-15


Part II.   Other Information

Item 1.  Legal Proceedings                                                   15
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds         15
Item 3.  Defaults Upon Senior Securities                                     15
Item 4.  Submission of Matters to a Vote of Security Holders                 15
Item 5.  Other Information                                                   15
Item 6.  Exhibits and Reports on Form 8-K                                 15-16

Signatures                                                                   16






                        PART I.   FINANCIAL INFORMATION





ITEM 1.  Financial Statements




                                  SCIENTIFIC ENERGY, INC.
                              (A Development Stage Company)
                                     Balance Sheets


<TABLE>
<CAPTION>

                                                           June 30,          December 31,
                                                            2007                2006
                                                       --------------    ----------------
                                                         (Unaudited)

                                         ASSETS

                                                           <c>              <c>
Current Assets:
 Cash and cash equivalents........................     $       63,305     $      369,365
                                                       --------------    ---------------
       Total Current Assets.......................             63,305            369,365

Property, Plant, & Equipment:
 Furniture and fixtures...........................                313                152
 Office equipment.................................              1,222              1,222
 Heavy equipment..................................            230,700                  -
 Machinery........................................             13,100                  -
 Vehicles.........................................             16,000                  -
 Tug and barge....................................             40,200                  -
                                                       --------------   ----------------
       Total Property, Plant, & Equipment.........            301,535              1,374
       Less: accumulated depreciation.............            (7,585)              (156)
                                                       --------------   ----------------
       Net Fixed Assets...........................            293,950              1,218

Total Assets......................................     $      357,255   $        370,583
                                                       ==============   ================



                            LIABILITIES AND STOCKHOLDERS' EQUITY


Current Liabilities:
 Accounts payable.................................     $           -    $            57
 Salary payable...................................             8,000                  -
                                                       --------------   ---------------
     Total Current Liabilities....................             8,000                 57

Stockholders' Equity:
 Preferred stock: par value $0.01; 25,000,000 shares
   authorized; none issued and outstanding
   at June 30, 2007 and December 31, 2006.........                 -                  -
 Common stock: par value $0.01; 100,000,000 shares
   authorized; 4,915,855 shares issued and outstanding
   at June 30, 2007 and December 31, 2006.........            49,159             49,159
 Additional paid-in capital.......................         1,234,030          1,234,030
 Deficit accumulated during the development stage          (933,934)		(912,663)
                                                      --------------   ----------------
     Total stockholders' equity...................           349,255            370,526

Total Liabilities and Stockholders' Equity........     $     357,255    $       370,583




                   See accompanying notes to unaudited financial statements

</TABLE>










                                       SCIENTIFIC ENERGY, INC.
                                    (A Development Stage Company)
                                 Statements of Operations (Unaudited)




<TABLE>
<CAPTION>
                                                                                                  Period From
                                                 Three Months Ended        Six Months Ended        May 30 2001
                                                      June 30,                  June 30,         (Inception) to
                                                 2007          2006         2007        2006      June 30, 2006
                                               ----------    ---------    ----------- ---------  --------------

                                                <c>          <c>           <c>        <c>           <c>

Service Revenue.........................       $   50,452    $       -     $   50,452  $      -   $     50,452

Cost of Sales...........................           50,179            -         50,179         -         50,179
                                               ----------   ----------    -----------  ---------  ------------
Gross Profit............................              273            -            273         -            273

Expenses:
 Research and development...............                -            -              -         -         68,090
 General and administrative.............           15,986       16,359         21,544    19,940        595,371
                                               ----------  -----------    -----------  ---------  ------------
    Total expenses......................           15,986       16,359         21,544    19,940        663,461

Loss from operations....................         (15,713)     (16,359)       (21,271)  (19,940)      (663,188)
                                               ----------  ------------   -----------  ---------  ------------

Other income (expense):
 Interest expense.......................                -            -              -     (100)       (20,207)
 Write-down of technology and royalties.                -            -              -         -      (250,040)
                                               ----------  ------------   ------------  --------  ------------
    Total other expense.................                -            -              -     (100)      (270,247)

Net loss before taxes...................         (15,713)     (16,359)       (21,271)  (20,040)      (933,435)

Income tax expense......................                -            -              -         -          (500)
                                               ----------  ------------   ------------ ---------  ------------

Net loss................................       $ (15,713)  $  (16,359)    $  (21,271)  $ (20,040) $  (933,935)
                                               ==========  ============   ============ ========== ============

Basic and diluted loss per share........       $  (0.003)  $   (0.006)    $   (0.004)  $  (0.011)
                                               ==========  ============   ============ ==========

Weighted average common shares outstanding     4,915,855     2,586,178      4,915,855   1,755,628
                                               ==========  ============   ============ ==========



                       See accompanying notes to unaudited financial statements



</TABLE>







                                     SCIENTIFIC ENERGY, INC.
                                 (A Development Stage Company)
                                    Statements of Cash Flows
                                         (Unaudited)


<TABLE>
<CAPTION>


                                                                                     Period From
                                                                                     May 30, 2001
                                                       Six Months Ended June 30,    (Inception) to
                                                         2007           2006        June 30, 2007
                                                    ------------   -------------  ---------------

                                                       <c>            <c>             <c>
Cash Flows from Operating Activities:
Net loss..........................................    $  (21,271)   $    (20,040)  $    (933,934)
Adjustments to reconcile net income to net cash
 used in operating activities:
  Depreciation expense............................         7,429               22          7,585
  Write-down of technology and royalties..........             -                -        250,040
  Stock issued for expenses.......................             -                -         31,200
Changes in operating assets and liabilities:
  Increase (decrease) in accounts payable.........          (57)           10,720              -
  Decrease in income tax payable..................             -            (100)              -
  Increase in salary payable......................         8,000                -          8,000
                                                     ------------   -------------   ------------
      Net cash used in operating activities.......       (5,899)          (9,398)      (637,109)

Cash Flows from Investing Activities:
 Purchase of property, plant and equipment........     (300,161)          (1,374)      (301,535)
                                                     ------------   -------------   ------------
      Net cash used in investing activities.......     (300,161)          (1,374)      (301,535)

Cash Flows from Financing Activities:
 Principal payments on shareholder loans..........             -          (3,720)       (39,915)
 Proceeds from shareholder loans..................             -                -        630,841
 Issuance of common stock.........................             -          400,000        400,000
 Contributed capital..............................             -           11,023         11,023
                                                     ------------   -------------   ------------
      Net cash provided by financing activities...             -          407,303      1,001,949

Increase (decrease) in cash and cash equivalents..     (306,060)          396,531         63,305

Cash and cash equivalents, beginning of period....       369,365              543              -
                                                     ------------   -------------   ------------

Cash and cash equivalents, end of period..........   $    63,305    $     397,074   $     63,305
                                                     ============   =============   ============


Supplemental disclosure of cash flow information:

  Interest paid in cash...........................   $         -     $          -    $    6,620
                                                     ============    ============   ============
  Income taxes paid in cash.......................   $         -     $        100    $      400


Supplemental Disclosure of non-cash investing and financing activities:

  Common stock exchanged for technology...........   $         -      $         -    $  250,040
                                                     ============    =============   ==========
  Note payable converted to common stock..........   $         -      $         -    $  590,926
                                                     ============    =============   ==========
  Contributed capital by shareholders for expenses   $         -      $         -    $   31,200
                                                     ============    =============   ==========




                   See accompanying notes to unaudited financial statements

</TABLE>








                                SCIENTIFIC ENERGY, INC.
                             (A Development Stage Company)
                        NOTES TO UNAUDITED FINANCIAL STATEMENTS
                                     June 30, 2007




Note 1.  Nature of Operations and Basis of Presentation

Scientific Energy, Inc. (the "Company") was incorporated under the laws of the
State of Utah on May 30, 2001. The business plan of the Company is to acquire
energy - related technologies, equipment and crude oil or natural gas fields.
As of June 30, 2007, the Company was in the development stage.

Separation From Parent Company

On June 6, 2001, Scientific Energy, Inc. (Utah) and Electronic Game Card, Inc.
entered into an agreement and plan of reorganization. Pursuant to the agreement,
Scientific Energy, Inc. (Utah) acquired 20,000,000 shares of Electronic Game
Card, Inc. in exchange for 100% of the issued and outstanding shares of
Scientific Energy (Utah). On December 5, 2003, the Company entered into an
agreement wherein the Company would receive 100% of its shares back from
Electronic Game Card, Inc.  As a result, the Company was no longer a wholly
owned subsidiary of Electronic Game Card, Inc.

Note 2. Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and with the instructions to Form 10?QSB and
Item 310(b) of Regulation S-B of the U.S. Securities and Exchange Commission.
Accordingly, they do not include all of the information and footnotes required
by accounting principles generally accepted in the United States of America for
annual financial statements.

In the opinion of management, the accompanying financial statements contain all
adjustments, including normal recurring adjustments, necessary for the fair
presentation of the Company's results of operations and financial position for
the periods presented. The results of operations for the six months ended
June 30, 2007 are not necessarily indicative of the results of operations to be
expected for the year ended December 31, 2007. The accompanying financial
statements should be read in conjunction with the financial statements and the
notes thereto of Scientific Energy, Inc. included in the Company's Annual
Report on Form 10?KSB for the fiscal year ended December 31, 2006.

Note 3. Summary of Significant Accounting Policies

Cash and Cash Equivalents

For purposes of the statements of cash flows, cash and cash equivalents includes
cash on hand and demand deposits held by banks.

Revenue Recognition

The Company derives its revenues from providing drilling services. Revenues
consists of fees received from services rendered under the Company's drilling
service agreement (see Note 8) that are provided using the Company's assets.
Revenues are recognized in accordance with SEC Staff Accounting Bulletin
No. 104, "Revenue Recognition" ("SAB 104"). The Company recognizes revenues
when there is persuasive evidence of an arrangement, the sales price is
determinable, and collection of the resulting receivable is reasonably assured.

Concentration of Credit Risk

The Company has no significant off-balance-sheet concentrations of credit risk
such as foreign exchange contracts, options contracts or other foreign hedging
arrangements.

Use of Estimates

The preparation of financial statements in conformity with the accounting
principles generally accepted in the United States of America requires the
Company to make estimates and judgments that affect the reported amounts of
assets and liabilities, revenues and expenses, and related disclosures of
contingent assets and liabilities.  Actual results could vary from those
estimates, and those variances might be significant.

Property, Plant, and Equipment

Property, plant, and equipment are carried at cost less accumulated
depreciation, which is computed using the straight-line method over the useful
lives of the assets. Upon disposal of assets, the cost and related accumulated
depreciation are removed from the accounts and any gain or loss is included in
income. Property and equipment are depreciated over their estimated useful lives
as follows:

    Heavy equipment              7 years
    Machinery                    7 years
    Tug and barge                7 years
    Vehicles                     5 years
    Computer equipment           5 years
    Furniture and fixtures       7 years

Depreciation expense for the six months ended June 30, 2007 and 2006 was $7,430
and $22, respectively.

Loss per Share

Loss per common stock share is computed pursuant to the provisions of SFAS
No. 128, "Earnings Per Share" (SFAS 128). Under SFAS 128, basic loss per common
stock share is computed by dividing net income (loss) available to common
stockholders by the weighted average number of common stock shares outstanding
during the period, excluding unvested restricted common stock. Diluted loss per
common stock share reflects the additional dilution for all potentially dilutive
securities such as unvested restricted common stock and convertible preferred
stock.

Note 4 - Principal Stockholder

As of June 30, 2007, Kelton Capital Group Ltd., controlled by Stanley Chan, our
president and CEO, owned 2,390,500 shares, or 48.6%, of our common stock. Other
than Stanley Chan, no persons own 5% or more of the Company's issued and
outstanding shares.

Note 5- Capital Stock

The Company is authorized to issue 100,000,000 shares of common stock, $0.01
par value, and 25,000,000 shares of preferred stock, $0.01 par value. As of
June 30, 2007, there were 4,915,855 shares of the Company's common stock issued
and outstanding, and none of the preferred shares were issued and outstanding.

On May 23, 2006, the Company entered into a Stock Purchase Agreement with Kelton
Capital Group Ltd., the controlling shareholder of the Company, and each of ten
individual investors in a private placement. Pursuant to the Agreement, the
Company sold and investors purchased an aggregate of 4,000,000 shares of the
Company's common stock for an aggregate consideration of $400,000 in cash.

On January 25, 2007, the Company amended its Articles of Incorporation to affect
a reverse stock split of the Company's common stock in which every ten (10)
outstanding shares would be combined into one (1) share.  All share transactions
disclosed in these financial statements give retroactive effect to this 1:10
reverse split.

Note 6 - Additional Paid-In Capital

In connection with the change in control of the Company, on May 31, 2006, the
selling shareholders paid off all liabilities (Accounts Payable, Note Payable-
Shareholder) of the Company by using their personal funds in an aggregate
amount of $11,023, which was recorded as additional paid-in capital.

Note 7 - Transactions with Related Parties

On April 13, 2006, there was a change in control of the Company effected
pursuant to a Share Purchase Agreement by and among Todd Crosland, Jana Meyer,
Mark Clawson and Dale Gledhill (collectively the "Sellers"), and Kelton Capital
Group Limited (the "Buyer"). Each of the Sellers were a director of the Company.
Under the Share Purchase Agreement, the Buyer acquired from the Sellers an
aggregate of 790,500 shares of the Company's issued and outstanding common
stock, representing approximately 86.3% of the Company's outstanding shares at
that time, for the aggregate cash purchase price of $539,929.

On May 23, 2006, the Company entered into a stock purchase agreement with Kelton
Capital Group Ltd., a company controlled by Stanley Chan, our president and CEO.
Under the agreement, Kelton purchased 4,000,000 shares of the Company's common
stock at a price of $0.10 per share.

Note 8 - Acquisition of Assets

On April 21, 2007, the Company entered into an Asset Purchase Agreement with
PT Prima Jasa Energy, an Indonesian crude oil drilling and service corporation
("PJE"), for the acquisition of certain of PJE's assets, including certain heavy
drilling equipment, facilities and contract rights associated with its crude oil
drilling and service business. The purchase price for the assets is
approximately $300,000. The transactions were closed April 30, 2007.

On April 21, 2007, the Company also entered into a long-term Drilling Services
Agreement with PJE, pursuant to which PJE will provide crude oil drilling and
services to the Company as an independent contractor. Under this contract PJE
will utilize the equipment and other assets purchase by the Company under the
Asset Purchase Agreement to provide drilling services under the operating
contract rights the Company acquired from PJE under the Asset Purchase
Agreement.  Under the contract PJE will also search for and develop new clients
on behalf of the Company, will maintain the equipment purchased, and will
collect accounts receivable under the operating contract rights on behalf of
the Company. The Services Agreement commenced on May 1, 2007.



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION


This report contains certain forward-looking statements that involve risks and
uncertainties. We use words such as "anticipate," "believe", "expect", "future",
"intend", "plan", and similar expressions to identify forward-looking
statements. These statements are only predictions. Although we believe that the
expectations reflected in these forward-looking statements are reasonable, we
cannot guarantee future results, levels of activity, performance or
achievements. You should not place undue reliance on these forward-looking
statements, which apply only as of the date of this report. Our actual results
could differ materially from those anticipated in these forward-looking
statements.

Overview
--------

We are a development stage company that has not engaged in material operations
nor realized consistent revenues for several years prior to the current quarter.
In April 2006, Kelton Capital Group Ltd. acquired a majority of the Company's
issued and outstanding common stock from four majority shareholders of the
Company. Prior to the share acquisition, the Company was to develop and
manufacture various energy generation devices and energy efficient mechanisms
for use in currently available products. The current business plan of the
Company is to acquire energy related technologies, equipment and crude oil or
natural gas fields.

On April 21, 2007, the Company entered into an Asset Purchase Agreement with
PT Prima Jasa Energy, an Indonesian crude oil drilling and service corporation
("PJE"), for the acquisition of certain of PJE's assets, including certain heavy
drilling equipment, facilities and contract rights associated with its crude oil
drilling and service business. The purchase price for the assets is
approximately $300,000. The transactions were closed April 30, 2007.

On April 21, 2007, the Company also entered into a long-term Drilling Services
Agreement with PJE, pursuant to which PJE will provide crude oil drilling and
services to the Company. The Services Agreement commenced on May 1, 2007. Under
the agreement, PJE agrees to provide to, or procure the provision to the
Company, by utilizing the equipment and other assets the Company purchased from
the PJE, of the following services:

 (1) Drilling services under the operating contract rights the Company acquired
 from PJE under the Purchase Agreement;

 (2) Searching for and development of new clients on behalf of the Company;

 (3) Maintenance of the heavy equipment, tug and barge, and other assets the
Company purchased from PJE under the Asset Purchase Agreement; and

 (4) Collection of accounts receivable under the operating contract rights on
behalf of the Company.

Sources of Revenue
------------------

Currently the Company generates revenue primarily from the service fees it earns
when oil companies, all of which are in the Republic of Indonesia, engage PJE
to provide drilling services for them. Pursuant to the Service Agreement dated
April 21, 2007, the Company shall pay PJE (i) 10% of the collected service
revenues (the "Collected Revenues") which PJE collected on behalf of the Company
from clients, plus (ii) reimbursement of PJE's operating costs, which shall not
exceed 75% of the Collected Revenues (collectively "Service Fees"). For the
three months ended June 30, 2007, the Company's revenue from drilling services
was $50,452. We are only in the beginning stages of our revenue generating
activities and intend to acquire more crude oil related equipment, assets,
contract rights, oilfields in the Republic of Indonesia or other Asia crude oil
rich countries upon completion of additional debt or equity financing, and
thereby increase our revenue generating activities.

Business Strategy
-----------------

We currently do not have our own work force, facilities or experience to
implement our business plan. The Company's business strategies are to (i) engage
one or more third party service providers to provide personnel, and expertise
for us; and (ii) selectively acquire more energy related assets, technologies,
equipment, services, businesses or oilfields.

To date we have purchased a drilling rig and other equipment and currently
contract with PT Prima Jasa Energy, a third party, to provide the service, on
behalf of us, to customers. We intend to continue to rely on such strategic
relationships with one or more contract service providers to provide service to
customers in the foreseeable future.

We also intend to develop additional business opportunities through
acquisitions. We intend to selectively acquire more energy related assets,
technologies, equipment, services, businesses or oilfields in Republic of
Indonesia or other Asia crude oil rich countries if there are opportunities and
we obtain additional financing.

Marketing and Sales
-------------------

The initial target market of our drilling services is those small or middle size
crude oil companies that do not have their own rigs and other drilling equipment
in Republic of Indonesia. We are a development stage company and at present have
no work force and expertise in the industry. We currently outsource and engage
PT Prima Jasa Energy to provide all services, including searching for and
development of new clients, and collection of accounts receivable under the
operating contract rights on behalf of us.

Government Contracts
--------------------

There are no government contracts at this time.

Compliance with Environmental Laws and Regulations
--------------------------------------------------

We do not believe that government regulation will have a material impact on the
way we conduct our business. Our operations, though a third party service
provider, are subject to local, provincial and national laws in Indonesia and
regulations governing environmental quality and pollution control. To date,
our compliance with these regulations by has had no material effect on our
operations, capital, earnings, or competitive position, and the cost of such
compliance has not been material. We are unable to assess or predict at this
time what effect additional regulations or legislation, if any, could have on
our activities.

Patents, trademarks, franchises, concessions, royalty agreements or labor
-------------------------------------------------------------------------
contracts
---------

We don't own any patents, trademarks, copyrights, franchises, concessions,
royalty agreements, or labor contracts.

Product Research and Development
--------------------------------

To date we have not conducted any product research and development. We do not
plan to conduct any product research and development activities in the next
twelve months.

Employees
---------

We have two full time employees. We may hire third party consultants or part-
time employees from time to time. None of our employees are covered by
collective bargaining agreements, and we believe our relationships with our
employees to be satisfactory.

We currently contract with PT Prima Jasa Energy, a third party, to provide the
service, on behalf of us, to customers.

Change in Shell Company Status
------------------------------

As reported on a Current Report on Form 8-K, under Item 5.06, filed July 17,
2007 with the Securities and Exchange Commission, as a result of the
consummation of the transactions described, the Company has ceased being a
shell company as such term is defined in Rule 12b-2 under the Securities
Exchange Act of 1934, as amended.

Results of Operations
---------------------

For the three months ended June 30, 2007 and 2006:
--------------------------------------------------

Service Revenue
---------------

For the three months ended June 30, 2007, the Company's revenue was $50,452,
which was generated from the service fees it earns when oil companies, all of
which are in the Republic of Indonesia, engage PJE to provide drilling services
to customers.  For the three months ended June 30, 2006, the Company had not
conducted any active operations, and therefore, no revenue had been generated
during this period.

Cost of Sales
-------------

Cost of sales consists of costs the Company paid to PJE under the service
agreement for the service it provided, which included the following two items:
(i) 10% of the collected service revenues which PJE collected on behalf of the
Company from clients, and (ii) reimbursement of PJE's operating costs for the
services PJE provided to the Company, plus depreciation expense for heavy
equipment, machinery, and tug and barge. For the three months ended June 30,
2007, the cost of sales of the Company was $50,179 , which was approximately
99.4% of the sales. For the three months ended June 30, 2006, the Company did
not conduct any operations, and therefore, no cost of sales was incurred for
this period.

Operating Expenses
------------------

For the three months ended June 30, 2007, the Company's general and
administrative expenses were $15,985  as compared to $16,359 for the same period
of the prior year. The largest expense items were salary expense ($8,000 or
50.0%), accounting and legal fees ($5,925 or 37.0%), and office rent (9.0%). .

Net Loss
--------

For the three months ended June 30, 2007, the Company had a net loss of $15,713,
or $0.003 per share, as compared to a net loss of $16,359, or $0.006 per share,
for the same period of the prior year.



For the six months ended June 30, 2007 and 2006:
------------------------------------------------

Service Revenue
---------------

For the six months ended June 30, 2007, the Company's revenue was $50,452, which
was generated from the service fees it earns when oil companies, all of which
are in the Republic of Indonesia, engage PJE to provide drilling services to
customers. For the six months ended June 30, 2006, the Company had not conducted
any active operations, and therefore, no revenue had been generated during this
period.

Cost of Sales
-------------

Cost of sales consists of costs the Company paid to PJE under the service
agreement for the service it provided, which included the following two items:
(i) 10% of the collected service revenues which PJE collected on behalf of the
Company from clients, and (ii) reimbursement of PJE's operating costs for the
services PJE provided to the Company, plus depreciation expense for heavy
equipment, machinery, and tug and barge. For the six months ended June 30, 2007,
the cost of sales of the Company was $50,179 , which was approximately 99.4%
of the sales. For the same period of the previous year, the Company had not
conducted any operations, and therefore, no cost of sales was incurred for the
period.

Operating Expenses
------------------

For the six months ended June 30, 2007, the Company's general and administrative
expenses were $21,544  as compared to $19,940 for the same period of the prior
year. The largest expenses items were salary expense ($8,000 or 37.1%),
accounting and legal fees ($5,925 or 27.5%), office rent ($2,880 or 13.3%), and
other general and administrative expenses ($4,739 or 21.9%). .

Net Loss
--------

For the six months ended June 30, 2007, the Company had a net loss of $21,272,
or $0.004 per share, as compared to a net loss of $20,040, or $0.011 per share,
for the same period of the prior year.

Liquidity and Capital Resources
-------------------------------

Since inception, the Company has been funded its operations primarily by equity
capital and short-term loans from its directors and officers. On May 23, 2006,
the Company entered into a stock purchase agreement with Kelton Capital Group
Ltd., the controlling shareholder of the Company, and nine individual investors
in a private placement. Pursuant to the agreement, the Company issued an
aggregate of 4,000,000 shares of its common stock for an aggregate consideration
of $400,000 in cash.

As of June 30, 2007, the Company had cash and cash equivalents of $63,305. For
the six months ended June 30, 2007, the Company's operating activities used net
cash of $5,899, primarily due to net loss of $21,272, and offset by increase
of $7,430 in depreciation expenses and increase of $8,000 in salary payable.

For the six months ended June 30, 2007, the Company's investing activities used
cash of $300,161, primarily for the purchase of equipment, machinery and tug
and barge. During this period, the Company had no financing activities.

A key component of the Company's business strategy is to selectively acquire
energy related assets, technologies, equipment, contract rights, or oilfields.
To finance any acquisitions, it may be necessary for the Company to raise
additional funds through public or private financings. Additional funds may not
be available on terms that are favorable to us, and, in the case of equity
financings, would result in dilution to our stockholders. We have no immediate
means for obtaining additional financing. There can be no assurance that such
additional financing, when and if necessary, will be available to us on
acceptable terms, or at all.

Off-Balance Sheet Arrangements
------------------------------

None.



ITEM 3.  CONTROLS AND PROCEDURES


(a) Disclosure controls and procedures. An evaluation was performed under the
supervision and with the participation of our management, including our Chief
Executive Officer, or CEO, and CFO, of the effectiveness of the design and
operation of our disclosure controls and procedures. Based on this evaluation
of our disclosure controls and procedures as described above, our CEO and CFO
have concluded that as of June 30, 2007 our disclosure controls and procedures
were effective.

(b) Internal controls over financial reporting. During the fiscal quarter ended
June 30, 2007, there have been no changes in our internal controls over
financial reporting that have materially affected, or are reasonably likely to
materially affect, our internal controls over financial reporting.



                            PART II - OTHER INFORMATION



Item 1.  Legal Proceedings

         None.

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

         None.

Item 3.  Defaults Upon Senior Securities

         None.

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

         None.

Item 5.  Other Information

         None.

Item 6.  Exhibits and Reports on Form 8-K

 (a)    Exhibits:

Exhibit No.                     Title of Document
----------  -------------------------------------------------------------------
  31        Certifications Required by Rule 13a-14(a) of the Securities Exchange
            Act of 1934, as amended, as Adopted Pursuant to Section 302 of the
            Sarbanes-Oxley Act of 2002

  32        Certification of Chief Executive Officer and Chief Financial Officer
            Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
            906 of the Sarbanes-Oxley Act of 2002

(b)    Reports on Form 8-K.

On April 18, 2007, the Company filed a Form 8-K under Item 5.02 to report that
Mary Jiang resigned as the Company's Secretary and as a member of the Board of
Directors.

On April 23, 2007, the Company filed a Form 8-K under Item 1.01 to report that
the Company entered into an Asset Purchase Agreement with PT Prima Jasa Energy,
an Indonesian crude oil drilling and service corporation ("PJE"), for the
acquisition of certain of PJE's assets, including certain heavy drilling
equipment, facilities and contract rights associated with its crude oil drilling
and service business. At the same time, the Company also entered into a long-
term Services Agreement with PJE, pursuant to which PJE will provide crude oil
drilling and services to the Company.

On July 17, 2007, the Company filed a Current Report on Form 8-K under Items
1.01, 2.01, 5.06 and 9.01 to report that as a result of the consummation of
the transactions described in Items 1.01 and 2.01 of this Current Report, the
Company has ceased being a shell company as such term is defined in Rule 12b-2
under the Securities Exchange Act of 1934, as amended.






                                    SIGNATURES


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




SCIENTIFIC ENERGY, INC.


Date:  August 15, 2007


By: /s/ Stanley Chan
-------------------------------------
Stanley Chan
President and Chief Executive Officer