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**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 April 30, 2006**





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




**For
      the Transition Period from _________ to _________**





**Commission
      file number: 000-51321**







**TRIANGLE
      PETROLEUM CORPORATION**


(Name
      of
      Small Business Issuer in Its Charter)





**Nevada**
            
            **98-0430762**(State
                or other jurisdiction of incorporation or organization)
            
            (IRS
                Employer Identification No.)





Suite
      1110, 521 - 3 Avenue SW


Calgary,
      Alberta


Canada
      T2P 3T3


(Address
      of Principal Executive Offices)





(403)
      262-4471


(Registrant’s
      telephone number, including area code)





(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
o





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).





Yes
o No
x





As
      of
      June 1, 2006, the Company had 20,082,530 shares of its par value $0.0001 common
      stock issued and outstanding.





Transitional
      Small Business Disclosure Format (check one):





Yes
o No
x







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**TRIANGLE
      PETROLEUM CORPORATION**





Quarterly
      Report on Form 10-QSB for the


Quarterly
      Period Ending April 30, 2006





TABLE
      OF CONTENTS





PART
                I. FINANCIAL INFORMATIONItem
                1.
            Financial
                StatementsConsolidated
                Balance Sheets:April
                30, 2006 (Unaudited) and January 31, 2006 (Audited)
            3Consolidated
                Statements of Operations:Three
                Months Ended April 30, 2006 and 2005 (Unaudited) and
                Period from December 11, 2003 (Date of Inception) to April 30, 2006
                (Unaudited)
            4Consolidated
                Statements of Cash Flows:Three
                Months Ended April 30, 2006 and 2005
                (Unaudited)
            5Notes
                to Unaudited Consolidated Financial
                Statements:April
                30, 2006
            6-15Item
                2.
            Management
                Discussion and Analysis
            16Item
                3.
            Controls
                and Procedures
            26PART
                II. OTHER INFORMATIONItem
                1.
            Legal
                Proceedings
            27Item
                2.
            Unregistered
                Sales of Equity Securities and Use of
                Proceeds
            27Item
                3.
            Defaults
                Upon Senior Securities
            27Item
                4.
            Submission
                of Matters to a Vote of Security
                Holders
            27Item
                5.
            Other
                Information
            27Item
                6.
            Exhibits
            27Signatures
            28






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Triangle
      Petroleum Corporation


(An
      Exploration Stage Company)


Consolidated
      Balance Sheets


(Expressed
      in U.S. dollars except share data)





April
                30,
              2006
              $
            
            January
                31,
              2006
              $(unaudited)ASSETSCurrent
                AssetsCash
                and cash equivalents
            
            
            15,317,626
            
            
            17,394,422Other
                current assets
            
            
            693,049
            
            
            406,356Total
                Current Assets
            
            
            16,010,675
            
            
            17,800,778Debt
                Issue Costs, net
            
            
            820,867
            
            
            903,158Property
                and Equipment (Note 4)
            
            
            81,486
            
            
            69,266Oil
                and Gas Properties, unproven (Note 5)
            
            
            8,257,136
            
            
            7,065,367Total
                Assets
            
            
            25,170,164
            
            
            25,838,569LIABILITIES
                AND STOCKHOLDERS’ EQUITYCurrent
                LiabilitiesAccounts
                payable
            
            
            594,063
            
            
            527,057Accrued
                liabilities (Note 6)
            
            
            1,309,236
            
            
            1,116,613Total
                Current Liabilities
            
            
            1,903,299
            
            
            1,643,670Asset
                Retirement Obligations (Note 5)
            
            
            33,000
            
            
            33,000Convertible
                Debentures, less unamortized discount of $13,741,823 and $15,793,697,
                respectively (Note 7)
            
            
            10,658,177
            
            
            9,306,303Total
                Liabilities
            
            
            12,594,476
            
            
            10,982,973Contingencies
                and Commitments (Notes 1, 5 and 11)Stockholders’
                EquityCommon
                Stock
              Authorized:
                100,000,000 shares, par value $0.00001
              Issued:
                19,882,530 shares (January 31, 2006 - 19,182,530 shares)
            
            
            199
            
            
            192Additional
                Paid-In Capital
            
            
            29,062,971
            
            
            27,623,110Donated
                Capital
            
            
            11,400
            
            
            11,400Deferred
                Compensation (Note 9)
            
            
            (3,629,167
            )
            
            (4,486,667
            )Deficit
                Accumulated During the Exploration Stage
            
            
            (12,869,715
            )
            
            (8,292,439
            )Total
                Stockholders’ Equity
            
            
            12,575,688
            
            
            14,855,596Total
                Liabilities and Stockholders’ Equity
            
            
            25,170,164
            
            
            25,838,569


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




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Triangle
      Petroleum Corporation


(An
      Exploration Stage Company)


Consolidated
      Statements of Operations


(Expressed
      in U.S. dollars except loss per share)


(unaudited)




Accumulated
                from
              December
                11, 2003
              (Date
                of Inception)
              to
                April 30,
            
            Three
              Months
              Ended
              April
                30,
            
            Three
              Months
              Ended
              April
                30,2006
            
            2006
            
            2005$
            
            $
            
            $Revenue
            
            
            —
            
            
            —
            
            
            —Operating
                ExpensesDepreciation
            
            
            10,397
            
            
            5,780
            
            
            —General
                and administrative
            
            
            6,235,024
            
            
            2,149,427
            
            
            23,824Impairment
                loss on oil and gas properties
            
            
            1,017,713
            
            
            —
            
            
            —Total
                Operating Expenses
            
            
            7,263,134
            
            
            2,155,207
            
            
            23,824Net
                Loss from Operations
            
            
            (7,263,134
            )
            
            (2,155,207
            )
            
            (23,824
            )Other
                Income (Expense)Accretion
                of discounts on convertible debentures
            
            
            (4,815,290
            )
            
            (2,051,874
            )
            
            —Amortization
                of debt issue costs
            
            
            (134,133
            )
            
            (82,291
            )
            
            —Interest
                income
            
            
            160,200
            
            
            108,726
            
            
            —Interest
                on long-term debt
            
            
            (784,887
            )
            
            (396,630
            )
            
            —Total
                Other Income (Expense)
            
            
            (5,574,110
            )
            
            (2,422,069
            )
            
            —Net
                Loss Before Discontinued Operations
            
            
            (12,837,244
            )
            
            (4,577,276
            )
            
            (23,824
            )Discontinued
                Operations (Note 3)
            
            
            (32,471
            )
            
            —
            
            
            (15,000
            )Net
                Loss for the Period
            
            
            (12,869,715
            )
            
            (4,577,276
            )
            
            (38,824
            )Net
                Loss Per ShareContinuing
                Operations - Basic and Diluted
            
            
            
            
            
            (0.23
            )
            
            —Discontinued
                Operations - Basic and Diluted
            
            
            
            
            
            —
            
            
            —(0.23
            )
            
            —Weighted
                Average Number of Shares Outstanding
            
            
            
            
            
            19,575,000
            
            
            46,283,000





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




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Triangle
      Petroleum Corporation


(An
      Exploration Stage Company)


Consolidated
      Statements of Cash Flows


(Expressed
      in U.S. dollars)


(unaudited)




Three
                Months
              Ended
              April
                30,
            
            Three
                Months
              Ended
              April
                30,2006
            
            2005$
            
            $Operating
                ActivitiesNet
                loss
            
            
            (4,577,276
            )
            
            (38,824
            )Adjustments
                to reconcile net loss to net cash used in operating
                activities:Accretion
                of discounts on convertible debentures
            
            
            2,051,874
            
            
            —Amortization
                of debt issue costs
            
            
            82,291
            
            
            —Depreciation
            
            
            5,780
            
            
            —Stock-based
                compensation
            
            
            1,597,368
            
            
            —Changes
                in operating assets and liabilitiesOther
                current assets
            
            
            (286,693
            )
            
            —Accounts
                payable and accrued liabilities
            
            
            259,629
            
            
            (25,167
            )Net
                Cash Used in Operating Activities
            
            
            (867,027
            )
            
            (63,991
            )Investing
                ActivitiesPurchase
                of property and equipment
            
            
            (18,000
            )
            
            —Oil
                and gas property expenditures
            
            
            (1,191,769
            )
            
            —Net
                Cash Used by Investing Activities
            
            
            (1,209,769
            )
            
            —Financing
                Activities
            
            
            —
            
            
            —Decrease
                in Cash and Cash Equivalents
            
            
            (2,076,796
            )
            
            (63,991
            )Cash
                and Cash Equivalents - Beginning of Period
            
            
            17,394,422
            
            
            148,102Cash
                and Cash Equivalents - End of Period
            
            
            15,317,626
            
            
            84,111Non-cash
                Investing and Financing ActivitiesStock
                issued for conversion of debenture
            
            
            700,000
            
            
            —Supplemental
                Disclosures:Interest
                paid
            
            
            —
            
            
            —Income
                taxes paid
            
            
            —
            
            
            —


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




5
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Triangle
      Petroleum Corporation


(An
      Exploration Stage Company)


Notes
      to the Consolidated Financial Statements


(Expressed
      in U.S. dollars, except as noted)


(unaudited)





**1.**
            **Exploration
                Stage Company**




The
      Company was incorporated in the State of Nevada on December 11, 2003 under
      the
      name Peloton Resources Inc. In December 2003, the Company purchased six mineral
      claims situated in the Greenwood Mining Division in the Province of British
      Columbia, Canada. The Company’s principal business plan was to acquire, explore
      and develop mineral properties and to ultimately seek earnings by exploiting
      the
      mineral claims. During the fiscal year ended January 31, 2006, the Company
      abandoned its mineral property as a result of poor exploration results, and
      changed the Company’s principal business to that of acquisition, exploration and
      development of oil and gas resource properties. On May 10, 2005, the Company
      changed its name to Triangle Petroleum Corporation.




The
      Company has been in the exploration stage since its formation in December 2003
      and has not yet realized any revenues from its planned operations. It is
      primarily engaged in the acquisition, exploration and development of oil and
      gas
      resource properties. The ability of the Company to emerge from the exploration
      stage with respect to planned principal business activities is dependent upon
      its successful efforts to raise additional equity financing and generate
      significant revenue. The Company has incurred losses of $12,869,715 since
      inception and has working capital of $14,107,376 as at April 30, 2006. During
      the year ended January 31, 2006, the Company issued $26,000,000 of convertible
      debentures. Management plans to raise additional capital through equity and/or
      debt financings. There is no guarantee that the proceeds from the financings
      raised by the Company, or proceeds from any future financings, will be
      sufficient to complete any of the above objectives. These factors raise
      substantial doubt regarding the Company’s ability to continue as a going
      concern.





**2.**
            **Summary
                of Significant Accounting
                Policies**




a)
            Basis
                of Presentation




These
      financial statements and related notes are presented in accordance with
      accounting principles generally accepted in the United States, and are expressed
      in US dollars. These consolidated financial statements include the accounts
      of
      the Company and its two wholly-owned subsidiaries, Elmworth Energy Corporation,
      incorporated in the Province of Alberta, Canada, and Triangle USA Petroleum
      Corporation, incorporated in the State of Colorado, USA. All significant
      intercompany balances and transactions have been eliminated. The Company’s
      fiscal year-end is January 31.




b)
            Use
                of Estimates




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




c)
            Cash
                and Cash Equivalents




The
      Company considers all highly liquid instruments with maturity of three months
      or
      less at the time of issuance to be cash equivalents.




d)
            Foreign
                Currency Transactions




The
      Company's functional currency is the United States dollar and management has
      adopted SFAS No. 52, “ *Foreign
      Currency Translation* ”.
      Monetary assets and liabilities denominated in foreign currencies are translated
      into United States dollars at rates of exchange in effect at the balance sheet
      date. Non-monetary assets, liabilities and items recorded in income arising
      from
      transactions denominated in foreign currencies are translated at rates of
      exchange in effect at the date of the transaction. Foreign currency transactions
      are primarily undertaken in Canadian dollars. The Company has not, to the date
      of these financials statements, entered into derivative instruments to offset
      the impact of foreign currency fluctuations.




e)
            Interim
                Financial Statements




These
      interim unaudited financial statements for the period ended April 30, 2006
      have
      been prepared on the same basis as the annual financial statements and in the
      opinion of management, reflect all adjustments, which include only normal
      recurring adjustments, necessary to present fairly the Company’s financial
      position, results of operations and cash flows for the periods shown. The
      results of operations for such periods are not necessarily indicative of the
      results expected for a full year or for any future period.




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Triangle
        Petroleum Corporation


(An
      Exploration Stage Company)


Notes
      to
      the Consolidated Financial Statements


(Expressed
      in U.S. dollars, except as noted)


(unaudited)




**2.**
            **Summary
                of Significant Accounting Policies
                (continued)**




f)
            Property
                and Equipment




Property
      and equipment consists of computer hardware, geophysical software, furniture
      and
      equipment and leasehold improvements, and is recorded at cost. Computer hardware
      and geophysical software are depreciated on a straight-line basis over their
      estimated useful lives of three years. Furniture and equipment are depreciated
      on a straight-line basis over their estimated useful lives of five years.
      Leasehold improvements are depreciated on a straight-line basis over their
      estimated useful lives of five years.




g)
            Long-lived
                Assets




In
      accordance with SFAS No. 144, “ *Accounting
      for the Impairment or Disposal of Long-Lived Assets* ”,
      the
      carrying value of intangible assets and other long-lived assets is reviewed
      on a
      regular basis for the existence of facts or circumstances that may suggest
      impairment. The Company recognizes impairment when the sum of the expected
      undiscounted future cash flows is less than the carrying amount of the asset.
      Impairment losses, if any, are measured as the excess of the carrying amount
      of
      the asset over its estimated fair value.




h)
            Asset
                Retirement Obligations




The
      Company recognizes a liability for future retirement obligations associated
      with
      the Company’s oil and gas properties. The estimated fair value of the asset
      retirement obligation is based on the current cost escalated at an inflation
      rate and discounted at a credit adjusted risk-free rate. This liability is
      capitalized as part of the cost of the related asset and amortized over its
      useful life. The liability accretes until the Company settles the
      obligation.




i)
            Oil
                and Gas Properties




The
      Company utilizes the full-cost method of accounting for petroleum and natural
      gas properties. Under this method, the Company capitalizes all costs associated
      with acquisition, exploration and development of oil and natural gas reserves,
      including leasehold acquisition costs, geological and geophysical expenditures,
      lease rentals on undeveloped properties and costs of drilling of productive
      and
      non-productive wells into the full cost pool on a country by country basis.
      As
      of April 30, 2006, the Company had no properties with proven reserves. When
      the
      Company obtains proven oil and gas reserves, capitalized costs, including
      estimated future costs to develop the reserves proved and estimated abandonment
      costs, net of salvage, will be depleted on the units-of-production method using
      estimates of proved reserves. The costs of unproved properties are not amortized
      until it is determined whether or not proved reserves can be assigned to the
      properties. Until such determination is made the Company assesses annually
      whether impairment has occurred, and includes in the amortization base drilling
      exploratory dry holes associated with unproved properties.




The
      Company applies a ceiling test to the capitalized cost in the full cost pool.
      The ceiling test limits such cost to the estimated present value, using a ten
      percent discount rate, of the future net revenue from proved reserves, based
      on
      current economic and operating conditions. Specifically, the Company computes
      the ceiling test so that capitalized cost, less accumulated depletion and
      related deferred income tax, do not exceed an amount (the ceiling) equal to
      the
      sum of: (A) The present value of estimated future net revenue computed by
      applying current prices of oil and gas reserves (with consideration of price
      changes only to the extent provided by contractual arrangements) to estimated
      future production of proved oil and gas reserves as of the date of the latest
      balance sheet presented, less estimated future expenditures (based on current
      cost) to be incurred in developing and producing the proved reserves computed
      using a discount factor of ten percent and assuming continuation of existing
      economic conditions; plus (B) the cost of property not being amortized; plus
      (C)
      the lower of cost or estimated fair value of unproven properties included in
      the
      costs being amortized; less (D) income tax effects related to differences
      between the book and tax basis of the property.




For
      unproven properties, the Company excludes from capitalized costs subject to
      depletion, all costs directly associated with the acquisition and evaluation
      of
      the unproved property until it is determined whether or not proved reserves
      can
      be assigned to the property. Until such a determination is made, the Company
      assesses the property at least annually to ascertain whether impairment has
      occurred. In assessing impairment the Company considers factors such as
      historical experience and other data such as primary lease terms of the
      property, average holding periods of unproved property, and geographic and
      geologic data. The Company adds the amount of impairment assessed to the cost
      to
      be amortized subject to the ceiling test. As of April 30, 2006, all of the
      Company’s oil and gas properties were unproved and were excluded from
      amortization.




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Triangle
      Petroleum Corporation


(An
      Exploration Stage Company)


Notes
      to
      the Consolidated Financial Statements


(Expressed
      in U.S. dollars, except as noted)


(unaudited)




**2.**
            **Summary
                of Significant Accounting Policies
                (continued)**




j)
            Debt
                Issue Costs




In
      accordance with the Accounting Principles Board Opinion 21 *“Interest
      on Receivables and Payables”,* the
      Company recognizes debt issue costs on the balance sheet as deferred charges,
      and amortizes the balance over the term of the related debt. The Company follows
      the guidance in the EITF 95-13 *“Classification
      of Debt Issue Costs in the Statement of Cash Flows”* and
      classifies cash payments for debt issue costs as a financing activity. During
      the three month period ended April 30, 2006, the Company recognized amortization
      expense of $82,291.




k)
            Income
                Taxes




Potential
      benefits of income tax losses are not recognized in the accounts until
      realization is more likely than not. The Company has adopted SFAS No. 109
“ *Accounting
      for Income Taxes* ”
as
      of
      its inception. Pursuant to SFAS No. 109 the Company is required to compute
      tax
      asset benefits for net operating losses carried forward. The potential benefits
      of net operating losses have not been recognized in these financial statements
      because the Company cannot be assured it is more likely than not it will utilize
      the net operating losses carried forward in future years.




l)
            Basic
                and Diluted Net Income (Loss) Per
                Share




The
      Company computes net income (loss) per share in accordance with SFAS No. 128,
      " *Earnings
      per Share* "
      (SFAS
      128). SFAS 128 requires presentation of both basic and diluted earnings per
      share (EPS) on the face of the income statement. Basic EPS is computed by
      dividing net income (loss) available to common shareholders (numerator) by
      the
      weighted average number of shares outstanding (denominator) during the period.
      Diluted EPS gives effect to all dilutive potential common shares outstanding
      during the period including convertible debt, stock options, and warrants,
      using
      the treasury stock method, and convertible securities, using the if-converted
      method. In computing diluted EPS, the average stock price for the period is
      used
      in determining the number of shares assumed to be purchased from the exercise
      of
      stock options or warrants. Diluted EPS excludes all dilutive potential shares
      if
      their effect is anti-dilutive.




m)
            Financial
                Instruments




The
      fair
      values of financial instruments, which includes cash and cash equivalents,
      other
      current assets, accounts payable, accrued liabilities and due to related parties
      approximate their carrying values due to the relatively short maturity of these
      instruments.




n)
            Concentration
                of Risk




The
      Company maintains its cash accounts in one commercial bank located in Calgary,
      Alberta, Canada. The Company's cash accounts are uninsured and insured business
      checking accounts and deposits maintained in U.S. and Canadian dollars. As
      at
      April 30, 2006, the Company has not engaged in any transactions that would
      be
      considered derivative instruments on hedging activities. To date, the Company
      has not incurred a loss relating to this concentration of credit
      risk.




o)
            Comprehensive
                Loss




SFAS
      No.
      130, “ *Reporting
      Comprehensive Income* ,”
      establishes standards for the reporting and display of comprehensive loss and
      its components in the financial statements. As at April 30, 2006 and 2005,
      the
      Company has no items that represent comprehensive loss and, therefore, has
      not
      included a schedule of comprehensive loss in the financial
      statements.




p)
            Stock-based
                Compensation




Prior
      to
      February 1, 2006, the Company accounted for stock-based awards under the
      recognition and measurement provisions of Accounting Principles Board Opinion
      (“APB”) No. 25, “Accounting for Stock Issued to Employees” using the intrinsic
      value method of accounting, under which compensation expense was only recognized
      if the exercise price of the Company’s employee stock options was less than the
      market price of the underlying common stock on the date of grant. Effective
      February 1, 2006, the Company adopted the fair value recognition provisions
      of
      SFAS No. 123R “Share Based Payments”, using the modified prospective transition
      method. Under that transition method, compensation cost is recognized for all
      share-based payments granted prior to, but not yet vested as of February 1,
      2006, based on the grant date fair value estimated in accordance with the
      original provisions of SFAS No. 123, and compensation cost for all share-based
      payments granted subsequent to February 1, 2006, based on the grant date fair
      value estimated in accordance with the provisions of SFAS 123R. Results for
      prior periods have not been restated.




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Triangle
        Petroleum Corporation
 (An
        Exploration Stage Company)
 Notes
        to
        the Consolidated Financial Statements
 (Expressed
        in U.S. dollars, except as noted)
 (unaudited)




**2.**
                **Summary
                    of Significant Accounting Policies
                    (continued)**




p)
            Stock-based
                Compensation (continued)




As
      a
      result of adopting SFAS 123R on February 1, 2006, the Company’s loss for the
      three month period ended April 30, 2006 is $112,034 higher than if it had
      continued to account for share-based compensation under APB No. 25. Basic and
      diluted loss per share for the three month period ended April 30, 2006 would
      have remained unchanged at $0.23 per share.




As
      there
      were no stock options granted prior to April 30, 2005, there was no effect
      on
      net loss and loss per share if the Company had applied the fair value
      recognition provisions of SFAS No. 123 for the prior period
      presented.




Effective
      August 5, 2005, the Company approved an incentive stock option plan (the “2005
      Incentive Stock Plan”) to issue up to 2,000,000 shares of common stock. The 2005
      Incentive Stock Plan allows for the granting of stock options at a price of
      not
      less than fair value of the stock and for a term not to exceed five years.
      The
      total number of options granted to any person shall not exceed 5% of the issued
      and outstanding common stock of the Company.




On
      February 21, 2006, the Company granted stock options under the 2005 Incentive
      Stock Plan to a director to acquire 200,000 common shares at an exercise price
      of $4.55 per share exercisable to February 21, 2011. The fair value for options
      granted was estimated at the date of grant using the Black-Scholes
      option-pricing model and the weighted average fair value of the stock options
      granted was $3.84 per share. On March 24, 2006, the Company granted stock
      options to a consultant to acquire 100,000 common shares at an exercise price
      of
      $3.46 per share exercisable to March 24, 2011. The fair value for options
      granted was estimated at the date of grant using the Black-Scholes
      option-pricing model and the weighted average fair value of stock options
      granted was $3.48 per share. During the three month period ended March 31,
      2006,
      the Company recorded stock-based compensation of $739,868 as general and
      administrative expense.




A
      summary
      of the Company’s stock option activity is as follows:





Three
                Months Ended
              April
                30, 2006Number
                of
              Options
            
            Weighted
                Average Exercise Price
              $Balance,
                Beginning of Period
            
            
            1,330,000
            
            
            3.28Granted
            
            
            300,000
            
            
            4.19Cancelled/forfeited
            
            
            (200,000
            )
            
            3.23Balance,
                End of Period
            
            
            1,430,000
            
            
            3.47




Additional
      information regarding stock options as at April 30, 2006 is as
      follows:





Outstanding
            
            ExercisableExercise
                prices
              $
            
            Number
                of
              shares
            
            Weighted
              average
              remaining
              contractual
              life
                (years)
            
            Weighted
              average
              exercise
                price
              $
            
            Number
                of
              shares
            
            Weighted
              average
              exercise
                price
              $3.23
            
            
            930,000
            
            
            4.27
            
            
            3.23
            
            
            372,000
            
            
            3.233.46
            
            
            100,000
            
            
            4.90
            
            
            3.46
            
            
            20,000
            
            
            3.463.53
            
            
            200,000
            
            
            4.45
            
            
            3.53
            
            
            100,000
            
            
            3.534.55
            
            
            200,000
            
            
            4.82
            
            
            4.55
            
            
            40,000
            
            
            4.551,430,000
            
            
            4.42
            
            
            3.47
            
            
            532,000
            
            
            3.39






9
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Triangle
      Petroleum Corporation


(An
      Exploration Stage Company)


Notes
      to
      the Consolidated Financial Statements


(Expressed
      in U.S. dollars, except as noted)


(unaudited)




**2.**
            **Summary
                of Significant Accounting Policies
                (continued)**




q)
            Recent
                Accounting Pronouncements




In
      May
      2005, the Financial Accounting Standards Board (FASB) issued SFAS No. 154,
      “ *Accounting
      Changes and Error Corrections - A Replacement of APB Opinion No. 20 and SFAS
      No.
      3* ”.
      SFAS
      154 changes the requirements for the accounting for and reporting of a change
      in
      accounting principle and applies to all voluntary changes in accounting
      principle. It also applies to changes required by an accounting pronouncement
      in
      the unusual instance that the pronouncement does not include specific transition
      provisions. SFAS 154 requires retrospective application to prior periods’
financial statements of changes in accounting principle, unless it is
      impracticable to determine either the period-specific effects or the cumulative
      effect of the change. The provisions of SFAS No. 154 are effective for
      accounting changes and correction of errors made in fiscal years beginning
      after
      December 15, 2005. The adoption of this standard did not have a material effect
      on the Company’s results of operations or financial position.




In
      December 2004, FASB issued SFAS No. 153, “ *Exchanges
      of Nonmonetary Assets - An Amendment of APB Opinion No. 29* ”.
      The
      guidance in APB Opinion No. 29, “ *Accounting
      for Nonmonetary Transactions* ”,
      is
      based on the principle that exchanges of nonmonetary assets should be measured
      based on the fair value of the assets exchanged. The guidance in that Opinion,
      however, included certain exceptions to that principle. SFAS No. 153 amends
      Opinion No. 29 to eliminate the exception for nonmonetary exchanges of similar
      productive assets and replaces it with a general exception for exchanges of
      nonmonetary assets that do not have commercial substance. A nonmonetary exchange
      has commercial substance if the future cash flows of the entity are expected
      to
      change significantly as a result of the exchange. The provisions of SFAS No.
      153
      are effective for nonmonetary asset exchanges occurring in fiscal periods
      beginning after June 15, 2005. Early application is permitted and companies
      must
      apply the standard prospectively. The adoption of this standard did not have
      a
      material effect on the Company’s results of operations or financial
      position.




In
      2006,
      the FASB has issued SFAS No. 155 *“Accounting
      for Certain Hybrid Financial Instruments - an amendment of FASB Statements
      No.
      133 and 140”* and No.
      156 *“Accounting
      for Servicing of Financial Assets - an amendment of FASB Statement No.
      140”* ,
      but
      they will not have a material effect in the Company’s results of operations or
      financial position. Therefore, a description and its impact for each on the
      Company’s operations and financial position have not been
      disclosed.




r)
            Reclassifications




Certain
      reclassifications have been made to the prior period’s financial statements to
      conform to the current period’s presentation.




**3.**
            **Discontinued
                Operations**




In
      December 2003, the Company, through its former President and director, acquired
      100% of the rights, title and interest in six mining claims representing six
      units in the Greenwood Mining Division in the Province of British Columbia,
      Canada. Payment of $1,912 was required to record these mining claims and paid
      by
      the former President of the Company. The claims were originally purchased by
      the
      former President, however, title to the claims had been conveyed to the Company
      via an unrecorded deed. During the fiscal year ended January 31, 2006, the
      Company abandoned its mineral property as a result of poor exploration
      results.




**4.**
            **Property
                and Equipment**




Cost
              $
            
            Accumulated
              Depreciation
              $
            
            April
                30,
              2006
              Net
                Carrying
              Value
              $
            
            January
                31,
              2006
              Net
                Carrying
              Value
              $Computer
                hardware
            
            
            46,301
            
            
            5,029
            
            
            41,272
            
            
            32,804Furniture
                and equipment
            
            
            31,500
            
            
            3,388
            
            
            28,112
            
            
            29,573Geophysical
                software
            
            
            8,000
            
            
            1,778
            
            
            6,222
            
            
            6,889Leasehold
                Improvements
            
            
            6,083
            
            
            203
            
            
            5,880
            
            
            —91,884
            
            
            10,398
            
            
            81,486
            
            
            69,266






10
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          to Table of Contents**


Triangle
        Petroleum Corporation
 (An
        Exploration Stage Company)
 Notes
        to
        the Consolidated Financial Statements
 (Expressed
        in U.S. dollars, except as noted)
 (unaudited)


**5.**
            **Oil
                and Gas Properties**





The
      total
      costs incurred and excluded from amortization are summarized as follows:





Acquisition
              $
            
            Exploration
              $
            
            Impairment
              Loss
              $
            
            April
                30,
              2006
              Net
                Carrying
              Value
              $
            
            January
                31,
              2006
              Net
                Carrying
              Value
              $Canadian
                properties
            
            
            1,716,961
            
            
            2,271,178
            
            
            —
            
            
            3,988,139
            
            
            3,411,226US
                properties
            
            
            3,860,184
            
            
            1,426,526
            
            
            (1,017,713
            )
            
            4,268,997
            
            
            3,654,141Totals
            
            
            5,577,145
            
            
            3,697,704
            
            
            (1,017,713
            )
            
            8,257,136
            
            
            7,065,367




All
      of
      the Company’s oil and gas properties are unproven and are located in the United
      States and Canada. The Company is currently participating in oil and gas
      exploration activities in Texas and Colorado, USA, and Alberta,
      Canada.




(a)
            On
                October 19, 2005, the Company entered into a Participation Agreement
                with
                a Texas based joint venture partner to earn a 30% interest in certain
                prospects located in the Southern Fort Worth Basin, Texas. The Company
                must pay $597,600, of which $300,000 has been paid, and the balance
                is
                payable on October 30, 2006.




(b)
            On
                October 28, 2005, the Company entered into a Letter Agreement with
                a
                Colorado based joint venture partner to acquire a 25% working interest
                in
                three prospects located in Colorado, Wyoming and Montana. The Company
                paid
                $2,000,000 in fiscal 2006 and is committed to pay up to an additional
                $2,492,334. The Company must pay 33.333% of the costs of drilling
                the
                first well, and 25% of the costs
                thereafter.




In
      fiscal
      2006, the Company recognized an impairment loss of $1,017,713 related to an
      evaluation well located on the Colorado acreage. This impairment loss includes
      $33,000 in asset retirement obligations accrued which is the Company’s estimated
      share of the costs to abandon and reclaim this well. The reclamation work is
      not
      expected to occur within the next twelve months.




**6.**
            **Accrued
                Liabilities**




The
      components of accrued liabilities are as follows:





April
                30,
              2006
              $
            
            January
                31,
              2006
              $Interest
            
            
            784,888
            
            
            388,258Oil
                and gas expenditures
            
            
            489,348
            
            
            725,855Professional
                fees
            
            
            35,000
            
            
            33,000Total
                accrued liabilities
            
            
            1,309,236
            
            
            1,116,613








**7.**
            **Convertible
                Debentures**




(a)
            On
                June 14, 2005, the Company entered into a securities purchase agreement
                with a single accredited investor (*the
                “Purchase Agreement”*)
                pursuant to which the investor purchased an 8% convertible debenture
                with
                a principal amount of $1,000,000, and a warrant to purchase 1,000,000
                shares of the Company’s common stock, exercisable at a price of $1.00 per
                share until June 15, 2008. Pursuant to the Purchase Agreement, the
                investor had the right to purchase up to $5,000,000 of additional
                convertible debentures and warrants to purchase 5,000,000 shares
                of common
                stock which was exercised on July 14, 2005, in exchange for an 8%
                convertible debenture with a principal amount of $5,000,000 and warrants
                to purchase 5,000,000 shares of the Company’s common stock, exercisable at
                a price of $1.00 per share until June 15,
                2008.






11
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          to Table of Contents**




Triangle
      Petroleum Corporation


(An
      Exploration Stage Company)


Notes
      to
      the Consolidated Financial Statements


(Expressed
      in U.S. dollars, except as noted)


(unaudited)




**7.**
            **Convertible
                Debentures (continued)**




The
      total
      convertible debentures of $6,000,000 are due and payable on June 10, 2007.
      The
      principal and accrued interest on these convertible debentures may be converted
      into shares of the Company’s common stock at a rate of $1.00 per share, at the
      option of the holder. The investor has contractually agreed to restrict the
      ability to convert the convertible debentures to an amount which would not
      exceed the difference between the number of shares of common stock beneficially
      owned by the holder or issuable upon exercise of the warrant held by such holder
      and 4.99% of the outstanding shares of common stock of the Company. The
      securities were issued in a private placement transaction pursuant to Regulation
      D under the Securities Act of 1933, as amended. The Company filed an SB-2
      Registration Statement registering the resale of shares of the Company's common
      stock issuable upon conversion of these convertible debentures and exercise
      of
      the warrants.




In
      accordance with EITF 98-5 *“Accounting
      for Convertible Securities with Beneficial Conversion Features or Contingently
      Adjustable Conversion Ratios”,* the
      Company recognized the value of the embedded beneficial conversion feature
      of
      $2,666,667 as additional paid-in capital and an equivalent discount which will
      be expensed over the term of the convertible debentures. In addition, in
      accordance with EITF 00-27 *“Application
      of Issue No. 98-5 to Certain Convertible Instruments”,* the
      Company has allocated the proceeds of issuance between the convertible debt
      and
      the detachable warrants based on their relative fair values. Accordingly, the
      Company recognized the fair value of the detachable warrants of $3,333,333
      as
      additional paid-in capital and an equivalent discount against the convertible
      debentures. During the year ended January 31, 2006, a debenture with a principal
      amount of $900,000 was converted into 900,000 shares of common stock. The
      unamortized discount on the respective convertible debenture of $378,722 was
      charged to accretion expense. During the three month period ended April 30,
      2006, a debenture with a principal amount of $700,000 was converted into 700,000
      shares of common stock. The unamortized discount on the respective convertible
      debenture of $481,250 was charged to accretion expense. The Company will record
      interest expense over the term of the remaining convertible debentures of
      $4,400,000 resulting from the difference between the stated value and carrying
      value at the date of issuance. To April 30, 2006, accrued interest of $391,737
      has been included in accrued liabilities, and interest expense of $2,475,000
      has
      been accreted increasing the carrying value of the convertible debentures to
      $1,925,000.




(b)
            On
                December 8, 2005, the Company entered into a Securities Purchase
                Agreement
                with a single investor pursuant to which the investor purchased 5%
                secured
                convertible debentures in the aggregate principal amount of $15,000,000.
                The gross proceeds of this financing will be received as
                follows:




(i)
            $5,000,000
                was received on closing;




(ii)
            $5,000,000
                was received on the second business day prior to the filing date
                of the
                SB-2 Registration Statement; and




(iii)
            $5,000,000
                will be received on the fifth business day following the effective
                date of
                the SB-2 Registration Statement (subsequently
                received)




The
      Company agreed to pay an 8% fee on the receipt of each installment, and a
      $15,000 structuring fee. The convertible debentures mature on the third
      anniversary of the date of issue (the “Maturity Date”) and bear interest at 5%
      per annum. The Company is not required to make any payments until the Maturity
      Date. The investor may convert, at any time, any amount outstanding under the
      convertible debentures into shares of common stock of the Company at a
      conversion price per share equal to the lesser of $5.00 or 90% of the average
      of
      the three lowest daily volume weighted average prices of the common stock,
      as
      quoted by Bloomberg, LP, of the ten trading days immediately preceding the
      date
      of conversion.




The
      Company, at its option has the right, with three business days advance written
      notice, to redeem a portion or all amounts outstanding under these convertible
      debentures prior to the Maturity Date provided that the closing bid price of
      the
      common stock is less than $5.00 at the time of the redemption. In the event
      of
      redemption, the
      Company is
      obligated to pay an amount equal to the principal amount being redeemed plus
      a
      20% redemption premium, and accrued interest.




In
      connection with the Purchase Agreement, the
      Company also
      entered into a registration rights
      agreement (the
“Registration Rights
      Agreement ”)
      providing for the filing of an SB-2 Registration Statement (the “Registration
      Statement”) with the U.S. Securities and Exchange Commission (“SEC”) registering
      the common stock issuable upon conversion of the convertible debentures. The
      Company is
      obligated to use its best efforts to cause the Registration Statement to be
      declared effective no later than June
      30,
      2006 and to
      insure that the Registration Statement remains in effect until all of the shares
      of common stock issuable upon conversion of the convertible debentures have
      been
      sold. In the event of a default of its obligations under the Registration Rights
      Agreement ,
      including its agreement to file the Registration Statement with the SEC no
      later
      than January
      22, 2006 ,
      or if
      the Registration Statement is not declared effective by June
      30,
      2006 ,
      it is
      required pay to the investor, as liquidated damages, for each month that the
      Registration Statement has not been filed or declared effective, as the case
      may
      be, either a cash amount or shares of common stock equal to 2% of the liquidated
      value of the convertible debentures. The Company filed an SB-2 Registration
      Statement on January 18, 2006.




12
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Triangle
        Petroleum Corporation
 (An
        Exploration Stage Company)
 Notes
        to
        the Consolidated Financial Statements
 (Expressed
        in U.S. dollars, except as noted)
 (unaudited)


**7.**
            **Convertible
                Debentures (continued)**




The
      investor has agreed to restrict its ability to convert the convertible
      debentures and receive shares of the
      Company ’s
      common
      stock such that the number of shares of common stock held by the investor in
      the
      aggregate and its affiliates after such conversion or exercise does not exceed
      4.9% of the then issued and outstanding shares of the
      Company ’s
      common
      stock.




In
      connection with the Securities Purchase Agreement, the
      Company and each
      of its subsidiaries executed
      security agreements (the “Security Agreements”) in favor of the investor
      granting them a first priority security interest in all of the Company’s goods,
      inventory, contractual rights and general intangibles, receivables, documents,
      instruments, chattel paper, and intellectual property. The Security Agreements
      state that if an event of default occurs under the convertible debentures or
      Security Agreements, the investor has the right to take possession of the
      collateral, to operate the Company’s business using the collateral, and have the
      right to assign, sell, lease or otherwise dispose of and deliver all or any
      part
      of the collateral, at public or private sale or otherwise to satisfy the
      Company’s obligations under these agreements.




In
      accordance with EITF 98-5 *“Accounting
      for Convertible Securities with Beneficial Conversion Features or Contingently
      Adjustable Conversion Ratios”,* the
      Company recognized the value of the embedded beneficial conversion feature
      of
      $2,557,113 as additional paid-in capital and an equivalent discount which will
      be expensed over the term of convertible debentures. The carrying value of
      the
      convertible debentures will be accreted to the face value of $10,000,000 to
      maturity. To April 30, 2006, accrued interest of $167,123 has been included
      in
      accrued liabilities, and interest expense of $285,724 has been accreted
      increasing the carrying value of the convertible debentures to
      $7,728,611.




(c)
            On
                December 28, 2005, the Company entered into a Securities Purchase
                Agreement with two accredited investors providing for the sale bythe
                Companyto
                the investors of 7.5% convertible debentures in the aggregate principal
                amount of $10,000,000 of which $5,000,000 was advanced immediately
                and
                1,250,000 warrants (the “Warrants”) to purchase 1,250,000 shares ofthe
                Company’s
                common stock, exercisable at a price of $5.00 per share untilDecember
                28,2006,
                of which 625,000 were issued. The second instalment of $5,000,000
                and
                625,000 warrants was advanced on January 18, 2006, upon the filing
                of an
                SB-2 Registration Statement bythe
                Companywith the SEC.




The
      convertible debentures mature on the third anniversary of the date of issuance
      (the “Maturity Date”) and bear interest at the annual rate of 7.5%. The
      Company is not
      required to make any payments until the Maturity Date. The investors may
      convert, at any time, any amount outstanding under the convertible debentures
      into shares of common stock of the
      Company at a
      conversion price per share of $4.00.




In
      connection with the Securities Purchase Agreement, the
      Company also
      entered into a registration rights
      agreement (the
“Registration Rights Agreement”) providing for the filing of a registration
      statement (the “Registration Statement”) with the SEC registering the common
      stock issuable upon conversion of the convertible debentures and Warrants. The
      Company is
      obligated to use its best efforts to cause the Registration Statement to be
      declared effective no later than May
      28,
      2006 and to
      insure that the registration statement remains in effect until all of the shares
      of common stock issuable upon conversion of the convertible debentures have
      been
      sold. In the event of a default of its obligations under the Registration Rights
      Agreement, including its agreement to file the Registration Statement with
      the
      SEC no later than February
      26, 2006 ,
      or if
      the Registration Statement is not declared effective by June 30,
      2006 ,
      the
      Company is required pay to the investors, as liquidated damages, for each month
      that the Registration Statement has not been filed or declared effective, as
      the
      case may be, a cash amount equal to 1% of the liquidated value of the
      convertible debentures. The Company filed an SB-2 Registration Statement on
      January 18, 2006.




Each
      investor has agreed to restrict its ability to convert the convertible
      debentures or exercise the Warrants and receive shares of the
      Company ’s
      common
      stock such that the number of shares of common stock held by them in the
      aggregate and their affiliates after such conversion or exercise does not exceed
      4.99% of the then issued and outstanding shares of the
      Company ’s
      common
      stock.




In
      accordance with EITF 98-5 *“Accounting
      for Convertible Securities with Beneficial Conversion Features or Contingently
      Adjustable Conversion Ratios”,* the
      Company recognized the value of the embedded beneficial conversion feature
      of
      $6,609,128 as additional paid-in capital and an equivalent discount which will
      be expensed over the term of the convertible debentures. In addition, in
      accordance with EITF 00-27 *“Application
      of Issue No. 98-5 to Certain Convertible Instruments”,* the
      Company has allocated the proceeds of issuance between the convertible debt
      and
      the detachable warrants based on their relative fair values. Accordingly, the
      Company recognized the fair value of the detachable warrants of $3,390,872
      as
      additional paid-in capital and an equivalent discount against the convertible
      debentures. The Company will record further interest expense over the term
      of
      the Convertible Debentures of $10,000,000 resulting from the difference between
      the stated value and carrying value at the date of issuance. The carrying value
      of the convertible debentures will be accreted to the face value of $10,000,000
      to maturity. To April 30, 2006, accrued interest of $226,027 has been included
      in accrued liabilities, and interest expense of $1,004,566 has been accreted
      increasing the carrying value of the Convertible Debentures to
      $1,004,566.




13
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          to Table of Contents**




Triangle
      Petroleum Corporation


(An
        Exploration Stage Company)
 Notes
        to
        the Consolidated Financial Statements
 (Expressed
        in U.S. dollars, except as noted)
 (unaudited)


**8.**
            **Related
                Party Transactions**




a)
            The
                Company paid the former Secretary of the Company $8,000 during the
                three
                month period ended April 30, 2005 for consulting services provided.
                Previously, the former Secretary provided consulting services to
                the
                Company valued at $250 per month. No amounts were recognized for
                donated
                services for the three month period ended April 30,
                2005.




b)
            During
                the three month period ended April 30, 2006, the Company paid $5,000
                in
                director’s fees.




c)
            Effective
                September 1, 2005, the Company agreed to pay $10,700 per month for
                management services provided by the President of the Company. This
                agreement was amended, effective February 1, 2006, by which the Company
                agreed to pay a salary of Cdn$12,000 per month to the President of
                the
                Company. During the three month period ended April 30, 2006, Cdn$36,000
                was charged to operations.




d)
            On
                June 23, 2005, the Company entered into a management consulting agreement
                with the President of the Company’s subsidiary. Under the terms of the
                agreement, the Company must pay $20,000 per month for an initial
                term of
                two years, and, unless notice of termination is given by either party,
                is
                automatically renewed for one year periods. During the three month
                period
                ended April 30, 2006, $60,000 was charged to operations.




e)
            On
                November 14, 2005, the Company entered into a management consulting
                agreement with the Chief Financial Officer of the Company. Under
                the terms
                of the agreement, the Company must pay $10,000 per month, as well
                as an
                annual bonus based upon mutually agreed upon targets. Effective January
                1,
                2006, the consulting agreement was amended to an employment agreement
                by which the Company agreed to pay a salary of Cdn$12,000 per
                month to the Chief Financial Officer. During the three month period
                ended
                April 30, 2006, Cdn$36,000 was charged to
                operations.




f)
            As
                at April 30, 2006, the Company was indebted to the President of the
                Company in the amount of $2,680 (January 31, 2006 - $1,397), which
                is
                included in accounts payable. This amount is for reimbursable business
                expenses incurred on behalf of the
                Company.





**9.**
            **Common
                Stock**




(a)
            In
                March 2006, the Company issued 700,000 shares of common stock upon
                the
                conversion of convertible debentures with a principal amount of
                $700,000.




(b)
            On
                June 2, 2005, the Company issued 2,000,000 shares of common stock
                to the
                President of the Company’s subsidiary at $0.01 per share for cash proceeds
                of $20,000. As the shares were issued for below fair value, a discount
                on
                the issuance of shares of $2,700,000 was recorded as deferred
                compensation. During the year ended January 31, 2006, $900,000 was
                charged
                to operations. During the three month period ended April 30, 2006,
                $337,500 was charged to operations. The remaining amount of $1,462,500
                in
                deferred compensation will be amortized over the remainder of the
                President’s two year employment
                contract.




(c)
            On
                May 16, 2005, the Company issued 4,000,000 shares of common stock
                to the
                President of the Company at $0.01 per share for cash proceeds of
                $40,000.
                As the shares were issued for below fair value, a discount on the
                issuance
                of shares of $4,160,000 was recorded as deferred compensation. During
                the
                year ended January 31, 2006, $1,473,333 was charged to operations.
                During
                the period ended April 30, 2006, $520,000 was charged to operations.
                The
                remaining amount of $2,166,667 in deferred compensation will be amortized
                over the remainder of the President’s two year employment
                contract.





**10.**
            **Share
                Purchase Warrants**




As
      at
      April 30, 2006, the following share purchase warrants were
      outstanding:





Number
                of Warrants
            
            Exercise
                Price
            
            Expiry
                Date6,000,000
            
            $
            1.00
            
            
            June
                15, 2008625,000
            
            $
            5.00
            
            
            December
                28, 2006625,000
            
            $
            5.00
            
            
            January
                23, 20077,250,000





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Triangle
      Petroleum Corporation


(An
        Exploration Stage Company)
 Notes
        to
        the Consolidated Financial Statements
 (Expressed
        in U.S. dollars, except as noted)
 (unaudited)


**11.**
            **Commitment**




On
      July
      19, 2005, the Company entered into a lease agreement commencing October 1,
      2005
      for office premises for a four year term expiring September 30, 2009. Annual
      rent is payable at $32,972 (Cdn$36,816) for the first two years and $34,663
      (Cdn$38,704) for the remaining two years. The Company must also pay its share
      of
      occupancy costs, currently at an annual rate of $18,042 (Cdn$20,145). During
      the
      three month period ended April 30, 2006, the Company paid rent expense of
      $13,211. Future minimum lease payments over the next five fiscal years are
      as
      follows:


2007
            
            $
            51,0002008
            
            $
            51,0002009
            
            $
            53,0002010
            
            $
            35,000$
            190,000





**12.**
            **Subsequent
                Event**


(a)
              On
                    May 26, 2006, the Company issued 200,000 shares of common stock
                    upon the
                    conversion of a convertible debenture with a principal amount
                    of
                    $200,000.  (b)
                On
                    June 1, 2006, the Company received the final $5,000,000 disbursement
                    relating to the convertible debenture referred to in Note
                    7(b).


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**ITEM
      2. MANAGEMENT'S DISCUSSION AND ANALYSIS****OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**




The
      following discussion contains forward-looking statements that are subject to
      significant risks and uncertainties about us, our current and planned projects,
      our current and proposed marketing and sales, and our projected results of
      operations. There are several important factors that could cause actual results
      to differ materially from historical results and percentages and results
      anticipated by the forward-looking statements. The Company has sought to
      identify the most significant risks to its business, but cannot predict whether
      or to what extent any of such risks may be realized nor can there be any
      assurance that the Company has identified all possible risks that might arise.
      Investors should carefully consider all of such risks before making an
      investment decision with respect to the Company's stock. The following
      discussion and analysis should be read in conjunction with the financial
      statements of the Company and notes thereto. This discussion should not be
      construed to imply that the results discussed herein will necessarily continue
      into the future, or that any conclusion reached herein will necessarily be
      indicative of actual operating results in the future. Such discussion represents
      only the best present assessment from our Management.


**Overview**





Prior
      to
      May 2005, we were known as Peloton Resources Inc., a mining exploration company.
      Peloton was actively searching for ore bodies containing gold in British
      Columbia. A consultant was hired to assess the economic viability of exploring
      for and developing gold reserves on Peloton’s properties. Based upon his report,
      Peloton decided to abandon all mining activities and to commence shifting
      towards an oil and gas exploration company. In connection with the shift in
      operational focus, we changed our name to Triangle Petroleum
      Corporation.





The
      changeover from a mining to an oil and gas exploration company has taken place
      over the last year, during one of the strongest bull markets for oil and natural
      gas. The average monthly price for West Texas Intermediate (WTI) crude oil
      and
      natural gas (Henry Hub Nymex), currently, as compared to the prior year, is
      as
      follows:





**Month
                and Year**
            **Oil
                price per barrel**
            **Natural
                Gas price Henry Hub Nymex (US$/mmbtu)**
            **Month
                and Year**
            **Natural
                Gas price Henry Hub Nymex (US$/mmbtu)**
            **Oil
                price per barrel**May
                2005
            $49
            $6.75
            May
                2004
            $5.94
            $40June
                2005
            $57
            $6.12
            June
                2004
            $6.68
            $38July
                2005
            $59
            $6.98
            July
                2004
            $6.14
            $40August
                2005
            $65
            $7.65
            August
                2004
            $6.05
            $44September
                2005
            $66
            $10.85
            September
                2004
            $5.08
            $46October
                2005
            $62
            $13.91
            October
                2004
            $5.72
            $53November
                2005
            $58
            $13.83
            November
                2004
            $7.63
            $48December
                2005
            $59
            $11.18
            December
                2004
            $7.98
            $43January
                2006
            $66
            $11.43
            January
                2005
            $6.21
            $47February
                2006
            $62
            $8.40
            February
                2005
            $6.29
            $48March
                2006
            $63
            $7.11
            March
                2005
            $6.30
            $54April
                2006
            $70
            $7.23
            April
                2005
            $7.32
            $53





This
      is
      consistent with most oil and gas analysts calling for continued high commodity
      prices due to strong or rising demand in the United States, China and India
      relative to regular supply disruptions in the Middle East, Gulf Coast states
      and
      other areas. Although these strong commodity prices have resulted in extremely
      competitive conditions for the supply of products and services for exploration
      companies, our outlook remains positive. Despite these strong fundamentals,
      it
      should be noted that short term fluctuations in North American natural gas
      prices will occur based upon seasonal weather patterns and gas storage levels.




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Since
      August 2005, we have undertaken the following major initiatives:




●
              Contracted
                  the services of an experienced geo science team, an experienced
                  landman
                  and hired a chief financial
                  officer;
 ●
              Participated
                  in drilling four deep basin gas wells in northwestern
                  Alberta;
 ●
              Reached
                  an agreement with Kerogen Resources Inc. to pursue opportunities
                  relating
                  to the Barnett Shale Project in the Greater Fort Worth area of
                  East
                  Texas;
 ●
              Reached
                  an agreement with Hunter Energy Exploration, Inc. to explore approximately
                  64,000 acres of mineral rights in three prospect areas in Colorado,
                  Wyoming and Montana;
 ●
              Participated
                  in drilling our first well in the United States with Hunter Energy
                  in
                  Colorado;
 ●
              Completed
                  $25 million funding;
 ●
              Established
                  initial acreage position in the Barnett Shale Project with participation
                  in the purchase of 2,600 acres;
 ●
              Participated
                  in drilling a three well program in the Barnett Shale Project located
                  in
                  Texas;
 ●
              Increased
                  the initial acreage position in the Barnett Shale Project from
                  2,600 acres
                  to 7,500 acres;
 ●
              Participated
                  in drilling a second well in the Barnett Shale Project located
                  in Texas;
 ●
              Finished
                  acquisition phase of 3-D seismic program on initial acreage position
                  in
                  the Barnett Shale Project;
 ●
              Increased
                  acreage position in the Barnett Shale Project from 7,500 acres
                  to 9,500
                  acres; and
 ●
              Executed
                  farm-in agreement on a 500,000 acre land block with a Canadian
                  joint
                  venture partner to explore unconventional gas opportunities in
                  Canada.




**Plan
      of Operations**





We
      believe that there are six critical elements for building a successful oil
      and
      gas exploration company in the current environment:





1.
            People
                - this includes a qualified board of directors, advisory board members,
                management, employees, and
                consultants;


2.
            Projects
                - a credible portfolio of projects that have the appropriate risk-return
                ratio in order to generate potentially significant shareholder
                value;


3.
            Capital
                - based upon the reputation of the people and the quality of the
                projects,
                there must be sufficient capital in order to launch the company and
                to
                provide for additional fundings;


4.
            Technology
                - the most advanced interpretation methods, techniques and methods
                should
                be utilized in order to maximize the potential for finding and developing
                oil and gas reserves;


5.
            Land
                position - the competitive nature of the oil and gas industry requires
                a
                combination of approaches in order to secure sufficient land positions
                to
                explore for oil and gas; and


6.
            Drilling
                capability - the competitive nature of the oilfield service industry
                requires a unique approach and a significant capital commitment in
                order
                to secure a drilling rig in today’s
                marketplace.





**People:**





In
      late
      May 2005 Mark Gustafson was hired as our President, Chief Executive Officer
      and
      director with a mandate to aggressively transform us into an emerging oil and
      gas exploration company. In June 2005, we recruited two additional directors,
      John Carlson (engineer) and Ron Hietala (petrophysicist). Mr. Hietala was then
      retained as the President and director of our Alberta operating subsidiary,
      Elmworth Energy Corporation. On October 27, 2005, Mr. Hietala’s role was further
      expanded to include being appointed President of Triangle USA Petroleum
      Corporation. Mr. Hietala’s specific mandate is to build a complete organization
      under his direction in Elmworth and Triangle USA based upon his 30 years
      experience in the oil and gas industry. Specifically, Mr. Hietala’s 19 year
      career and contacts at Canadian Hunter Exploration Ltd. continues to be critical
      in order to attract qualified employees and consultants for Elmworth and
      Triangle USA. In November 2005, we hired Aly Musani as our Chief Financial
      Officer to oversee all of our financial operations. In March 2006, Mr. Musani’s
      role was expanded as he was appointed to the role of Secretary and
      Treasurer.





We
      have
      contracted several significant additions to the operating team in Elmworth
      based
      upon Mr. Hietala’s contacts, including landmen, geologists, geophysicists and
      engineers. We added Mr. Clarence Campbell, an industry recognized clastic
      sedimentologist and stratigrapher, who has worked extensively both domestically
      and




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internationally.
      Mr. Campbell’s practical, hands on experience in Western Canada is a strong
      asset to the integrated geological and geophysical projects. Another addition
      to
      the geoscience team is Mr. Arthur Bowman. Mr. Bowman received a BSc. from
      University of Toronto in 1977 and began his geophysical career in Calgary with
      Chevron Canada Resources Ltd. At Chevron, Mr. Bowman worked as an interpreter
      on
      various projects in Alberta and North Eastern British Columbia. More recently,
      Mr. Bowman was a founder of Defiant Energy Corp. The company commenced
      operations in 1998 and established production of 3,500 barrels of oil equivalent
      per day until the company was sold to Advantage Energy Trust in 2004. Mr. Bowman
      acted as geophysicist, geologist and Vice-President of Exploration. The Elmworth
      geoscience team was complemented by the addition of an experienced landman,
      Mr.
      Neil McPherson. Mr. McPherson brings thirty-six years of land expertise to
      Elmworth. Mr. McPherson began his career in the land department of Mobil Oil
      Canada Ltd. He was actively involved in both surface and mineral land issues.
      Subsequent to this, he has held a variety of senior and executive positions
      with
      companies such as Sundance Oil Canada Ltd., Covenant Resources Ltd., Oakwood
      Petroleum, Morgan Hydrocarbons, Mannville Oil and Gas Ltd. and High Point
      Resources Inc. We recently retained the services of an experienced Calgary
      based
      executive search firm in order to secure the services of a qualified candidate
      for the position of Chief Operating Officer. We expect this position to be
      filled within the next one to two months.





In
      addition, we added Stephen A. Holditch to our board of directors. Since January
      2004, Mr. Holditch has been the Head of the Department of Petroleum Engineering
      at Texas A&M University. Since 1976 through the present, Mr. Holditch has
      been a faculty member at Texas A&M University, as an Assistant Professor,
      Associate Professor, Professor and Professor Emeritus. Since its founding in
      1977 until 1997, when it was acquired by Schlumberger Technology Corporation,
      Mr. Holditch was the Founder and President of S.A. Holditch & Associates,
      Inc., a petroleum
      technology company providing analysis of low permeability gas reservoirs and
      designing hydraulic fracture treatments. Mr. Holditch previously worked for
      Shell Oil Company and Pan American Petroleum Corporation. Mr. Holditch is a
      registered professional engineer in Texas, has received numerous honors, awards
      and recognitions and has authored or co-authored over 100 publications on the
      oil and gas industry. Mr.
      Holditch received his B.S., M.S. and Ph.D. in Petroleum Engineering from Texas
      A&M University in 1969, 1970 and 1976, respectively. We continue to seek
      additional qualified candidates to join our Board of Directors.





We
      do not
      intend to hire a significant number of employees over the next twelve months,
      as
      we intend to utilize our strong industry contacts with top quality consultants
      and contractors.





**Projects:**





During
      the quarter ended April 30, 2006, we further refined our strategic plan and
      have
      determined that the maximum value to all of our stakeholders is best served
      by
      targeting three focused project areas that provide geographical diversification
      and acceptable returns for invested capital. The three major project areas
      are
      as follows:





*Barnett
      Shale Project - Greater Fort Worth Basin, Texas*





Through
      our operating subsidiary, Triangle USA Petroleum Corporation, we have a 30%
      interest in a large joint venture area in the Barnett Shale of the Greater
      Fort
      Worth Basin. The joint venture was established through a strategic relationship
      with Kerogen Resources of Houston, Texas.





The
      Barnett Shale trend was pioneered by Mitchell Energy starting in 1981.
      Commercialization of the project was slow to occur until the application of
      large water fracturing stimulations at the Newark East Field in 1997. A second
      technology breakthrough occurred with the application of horizontal wells and
      selective stimulations. The Barnett Shale trend now supports daily production
      in
      excess of 1.2 bcf per day of natural gas with the USGS (United States Geological
      Survey) estimating a resource potential of greater than 25 tcf (trillion cubic
      feet) of natural gas. The Barnett Shale trend is the largest gas field in Texas
      with the productive limits being expanded regularly. Triangle USA has entered
      into the Barnett Shale trend through a joint venture with Kerogen Resources
      Inc.
      of Houston, Texas. Kerogen’s focus is to identify and exploit present and future
      shale gas projects within the United Sates and internationally. The principals
      of Kerogen also have many years of shale gas evaluation experience coupled
      with
      active involvement in the drilling, completion and production phases of Barnett
      Shale gas. Triangle USA, along with the joint venture partners, have commenced
      a
      land acquisition phase in the Fort Worth Basin (Texas). To
      date,
      9,500 acres have been secured through the Kerogen joint venture. A ten square
      mile initial 3-D seismic program has been designed. It is anticipated the
      data




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will
      be
      processed and interpreted by the end of June 2006. Drilling targets will then
      be
      selected and prioritized based on availability of drilling services and
      equipment. Well spacing for the Barnett Shale ranges from 40 to 100 acres across
      the productive areas. Triangle
      USA believes the Barnett Shale trend to be an exploration opportunity that
      will
      continue to benefit from the application of new technology and sound field
      procedures.





Triangle
      USA is also currently participating in the drilling of three Barnett Shale
      wells
      in the Greater Fort Worth Basin. The wells are anticipated to be an extension
      of
      the productive trend. The drilling and completion program is a pilot project
      for
      a new completion technique designed to access incremental reserves and to
      establish higher levels of initial well productivity. Triangle USA has a 6.75%
      working interest in the project. The three horizontal wells in this multi-well
      project have been drilled to the projected total depth. The timing of the
      stimulation will be coordinated with the construction of pipeline and production
      facilities. Stimulation procedures and techniques developed in this first pilot
      project will be applied to the significant land block currently held by Triangle
      USA and its partner group.





Triangle
      USA’s third project in Johnson County has completed drilling operations. The
      well has been multi-stage fracture stimulated and is currently being flow
      tested. This well is located in the active development area of the Barnett
      Shale. Triangle USA Petroleum has a 6% working interest in this Johnson County
      project.





Triangle
      USA along with its joint venture partner, Kerogen, will also evaluate other
      shale gas projects outside of the Greater Fort Worth Basin.





*West
      Central Alberta Deep Basin Opportunities*





Based
      upon Mr. Hietala’s successful career at Canadian Hunter Exploration Ltd. in
      developing natural gas in northwestern Alberta (Deep Basin), our board decided
      in June 2005 to consider exploring for natural gas in this area. In order to
      confirm the potential upside for Elmworth in exploring for natural gas in this
      area, two consulting firms were engaged. Calgary based Sproule Associates
      Limited prepared an independent geological assessment of the target area in
      June
      and concluded that there was approximately 820 bcf (billion cubic feet) of
      discovered and undiscovered recoverable raw gas remaining to be produced from
      the targeted horizons. In July 2005, Calgary based Petrel Robertson Consulting
      Ltd. prepared a broader geological resource assessment of this target area
      and
      concluded that the estimated gas in place is approximately 2,000 bcf. Based
      upon
      Mr. Hietala’s experience and these two reports, we have decided to explore these
      zones.





In
      October 2005, Elmworth participated in a 2,500 meter (8,250 feet) drilling
      project in the Deep Basin of West Central Alberta. This first evaluation well
      allowed us to earn the right to drill in five additional sections of land
      (approximately 3,200 acres). Elmworth has paid 38.5% of the costs. A hydraulic
      fracture stimulation program was performed on the exploration target identified
      by the operator. Commercial quantities of gas have not been tested from this
      well to date. However, Elmworth acquired proprietary well log data from this
      location that will be used to interpret the extensive 3-D seismic data currently
      under review. This land block held by Elmworth is currently being assessed
      for
      additional drilling locations.





In
      November 2005, Elmworth participated in a joint venture which targeted
      exploration opportunities in the south Deep Basin area of Alberta. 23 sections
      of land (approximately 14,700 acres) were earned upon the drilling of three
      commitment wells. Elmworth is participating for a 25% working interest in the
      first well. The first well was rig released in early December. A hydraulic
      fracture stimulation program was initiated on the Upper Cretaceous exploration
      targets. The primary horizon was not productive although a shallower interval
      is
      scheduled for completion. The second well is currently being evaluated for
      completion by the operator while the third well was plugged back to a shallower
      horizon. A completion program for the second well is currently under review
      with
      field work scheduled to commence summer.





*Hunter
      Energy Joint Venture Opportunity*





On
      October 31, 2005 we executed a joint venture agreement with Hunter Energy of
      Denver Colorado for a 25% working interest in three project areas. The joint
      venture currently has approximately 64,000 acres of mineral rights in three
      prospect areas in Colorado, Wyoming and Montana. At least one well will be
      drilled in each area. Triangle USA has committed a minimum of $4.5 million
      to
      this joint venture. Based upon the results of the initial exploratory program,
      we have the option to participate in additional land acquisitions and drilling
      programs. Hunter




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has
      a
      unique exploration team whose members are led by Mr. John Masters, a co-founder
      of Canadian Hunter Exploration Limited. Canadian Hunter pioneered the
      exploration concepts of pervasive gas saturated reservoir accumulations that
      today are known as Basin Centered Gas Fields. The observations and the technical
      understanding led by John Masters and the Canadian Hunter team have resulted
      in
      multi-TCF’s (trillion cubic feet) of gas being produced to date in the Western
      Canadian Sedimentary Basin. The greater Deep Basin today continues to be a
      cornerstone in the asset base of many Canadian and international companies.
      Hunter has a team of 11 petroleum technology experts and 12 associated staff,
      several of whom were trained at Canadian Hunter. The business environment of
      the
      Rocky Mountain basins is attractive to establishing new projects, due to the
      fact that land costs, drilling density and hydrocarbon potential are all
      favorable in the areas selected by the experienced team at Hunter.





Triangle
      USA Petroleum Corporation has a 25% working interest in the joint venture
      properties comprised of 64,000 acres of mineral rights in three prospect areas
      in Colorado, Wyoming and Montana. The first exploration test well in Colorado
      was drilled in November 2005, the first evaluation of well logs and drill
      cuttings indicated that the well encountered the targeted objective as planned.
      The drilling rig finished operations in early January, successfully drilling
      to
      the target formations. The completion rig for the exploration test located
      in
      northwest Colorado was released in the middle of March and all technical and
      operational data gathered to date has not established the presence of commercial
      hydrocarbons. Triangle USA has reviewed the operator’s technical assessment of
      the exploration test. Triangle USA will also work with Hunter Energy to evaluate
      other hydrocarbon opportunities on the large land block that has been earned
      by
      the drilling of this first well.





**Capital:**





Based
      upon a new board of directors and an exploration program for Elmworth, we were
      able to secure a $6 million convertible debenture financing. The first tranche
      of $1 million was received in June 2005 and the balance of $5 million was
      received in July 2005. This funding was completed with one accredited investor
      and with no fees, other than legal costs to prepare a registration statement.
      This financing allowed us to proceed in the execution of our operating
      plan.





In
      anticipation of the significant funds required to undertake the projects
      mentioned above and to acquire additional seismic data, acquire land positions,
      and launch drilling programs, we anticipated that we would require approximately
      $25 million in additional funding. We have secured a $15 million funding
      commitment from one institutional investor with gross proceeds of $10 million
      having been received prior to January 31, 2006. The final $5 million was
      received subsequent to the quarter end. We have also secured a $10 million
      funding commitment from two institutional investors with all gross proceeds
      having been received prior to January 31, 2006.





**Technology:**





One
      of
      the keys to finding natural gas is the use of available resources and advanced
      technological methods. In June 2005, Elmworth acquired new, high quality three
      dimensional seismic data covering 30 square miles in northwestern Alberta.
      This
      initial seismic data has been interpreted by the experienced team of geologists
      and geophysicists. This review was finalized during the first fiscal quarter
      of
      2006. **** The
      initial objective here was to identify preliminary locations to target within
      the selected area. The acquired seismic will be used to establish opportunities
      in this multi-horizon area. We have recently made an additional seismic purchase
      in order to continue the interpretation and drilling location selection process.
      In addition to state of the art seismic interpretation, Elmworth will utilize
      advanced reservoir analysis techniques and the technical experience of its
      geological and geophysical team to further the opportunity identification
      process.




Elmworth
      has concluded two strategic technology partnerships. The first initiative is
      with the Department of Geophysics at the Colorado School of Mines under its
      Reservoir Characterization Project. This highly regarded, industry sponsored
      project, is developing advanced techniques to identify production from “Basin
      Centered” gas accumulations similar to the projects being pursued by Elmworth in
      the Alberta Deep Basin and also by Hunter Energy in the Rocky Mountain areas
      of
      the United States. The second initiative is with the Department of Geophysics
      at
      Stanford University. This project should provide Elmworth with key expertise
      related to seismic attribute analysis. Seismic attribute analysis is believed
      to
      provide new insights that will be used to identify drilling opportunities in
      the
      extensive 3-D seismic surveys being acquired by Elmworth in the Deep Basin.
      The
      strategic




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technology
      initiatives should support the Elmworth geo-science team and allow the team
      to
      focus on opportunity identification and land acquisition.





**Land:**





There
      are
      four different methods to acquire or participate in the leasing of oil and
      gas
      rights under the land in the target area:





(a)
            conventional
                crown land postings - under the current highly competitive environment,
                Elmworth will attempt to bid for oil and gas rights on lands that
                the
                province of Alberta owns pursuant to their regular land auction
                process.


(b)
            joint
                venture farm-ins - companies that own the oil and gas rights on land
                that
                Elmworth wishes to pursue may not be able to drill on their land
                for a
                variety of reasons (lack of capital, non-core area, etc.), which
                allows
                Elmworth the opportunity to farm-in on their lands (i.e. drill on
                their
                lands in order to earn a working interest in the
                well).


(c)
            drilling
                rig leverage - since drilling rigs are in such high demand, then
                there is
                an opportunity to utilize a secured rig as a negotiating tool to
                access
                drilling sites from other companies that have not secured a
                rig.


(d)
            technology
                leverage - through the technical strength of Elmworth’s consultants,
                contractors and advisory group there will be situations in which
                companies
                offer access to their land as a direct result of Elmworth’s willingness to
                work with their internal teams.





The
      acquisition of mineral rights on lands within the targeted area is an ongoing
      process that will continue throughout the drilling programs. To date, Elmworth
      has acquired oil and gas interests primarily via joint venture
      farm-ins.





**Drilling
      capability:**





On
      October 24, 2005, Elmworth executed a letter of intent with a Calgary, Alberta
      based drilling contractor to secure a drilling rig for Elmworth’s Canadian
      winter 2005/2006 program. The contract also allows Elmworth the option to extend
      the contract term. The 3,000 meter rig will be located in the south Grande
      Prairie Area. Calgary based Crest Energy Consultants has been engaged by
      Elmworth to design and supervise all phases of the drilling and completion
      programs for the company in Canada.





**Projected
      Quarterly Milestones**





May
      2006
      to July 2006


Ø
            Acquire
                additional seismic data in Deep Basin project in
                Canada


Ø
            Add
                engineering expertise to the management
                team


Ø
            Complete
                evaluation of potential winter drilling projects in Canada


Ø
            Prepare
                drill site location for second well in Hunter Energy
                project


Ø
            Continue
                acquiring acreage in Barnett Shale
                project


Ø
            Commence
                drilling wells in second project in the Barnett Shale
                project


Ø
            Evaluate
                other projects to complement existing
                programs





August
      2006 to October 2006


Ø
            Continue
                to evaluate a Canadian winter drilling
                program


Ø
            Commence
                drilling second well in the Hunter Energy
                program


Ø
            Continue
                drilling wells in multiple projects in the Barnett Shale
                project


Ø
            Continue
                evaluating new complementary
                projects


Ø
            Establish
                initial production base





November
      2006 to January 2007


Ø
            Continue
                to assess Canadian drilling program


Ø
            Commence
                drilling third well in Hunter Energy
                program


Ø
            Continue
                drilling wells in multiple projects in the Barnett Shale
                project


Ø
            Continue
                evaluating new complementary
                projects


Ø
            Expand
                upon initial production base






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February
      2007 to April 2007


Ø
            Continue
                to accumulate acreage in the Barnett Shale
                Project


Ø
            Continue
                drilling wells in multiple projects in the Barnett Shale
                project


Ø
            Continue
                evaluating new complementary
                projects


Ø
            Continue
                to increase production base





**Liquidity
      and Capital Resources**





As
      of
      April 30, 2006, we had working capital of $14,107,376, resulting primarily
      from
      our cash and cash equivalents of $15,317,626 at year end. For the three months
      ended April 30, 2006, we had net cash outflow from operating activities of
      $867,027. Cash used in investing activities totaled $1,209,769, which was
      primarily utilized for Elmworth’s share of costs relating to the preparation of
      the lease to drill its first operated Alberta deep basin gas well. In Triangle
      USA, the funds were primarily used for the payments made to participate in
      the
      drilling of four Barnett Shale Gas wells and to accumulate land in this project
      area. Cash provided by financing activities totaled $nil for the three months
      ended April 30, 2006. On June 1, 2006 we received the final $5 million
      installment relating to the December 8, 2005 Secured Convertible Debenture
      Financing ** detailed
      below. The receipt of this final installment will provide us with the liquidity
      to fully execute our fiscal 2007 budget.





We
      expect
      significant capital expenditures during the next 12 months for seismic data
      acquisitions, land and drilling rights acquisitions, drilling programs, overhead
      and working capital purposes. We have sufficient funds to conduct our operations
      for existing budgeted projects for the next 12 months, but not for new or
      expanded projects. There can be no assurance that additional financing will
      be
      available in amounts or on terms acceptable to us, if at all.





By
      adjusting our operations to the level of capitalization, we believe we have
      sufficient capital resources to meet projected cash flow deficits. However,
      if
      during that period or thereafter, we are not successful in generating sufficient
      liquidity from operations or in raising sufficient capital resources, on terms
      acceptable to us, this could have a material adverse effect on our business,
      results of operations liquidity and financial condition.





We
      presently do not have any available credit, bank financing or other external
      sources of liquidity. Due to our brief history and historical operating losses,
      our operations have not been a source of liquidity. We will need to obtain
      additional capital in order to expand operations and become profitable. In
      order
      to obtain capital, we may need to sell additional shares of our common stock
      or
      borrow funds from private lenders. There can be no assurance that we will be
      successful in obtaining additional funding.





We
      will
      still need additional investments in order to continue operations to cash flow
      break even. Additional investments are being sought, but we cannot guarantee
      that we will be able to obtain such investments. Financing transactions may
      include the issuance of equity or debt securities, obtaining credit facilities,
      or other financing mechanisms. However, the trading price of our common stock
      and a downturn in the U.S. stock and debt markets could make it more difficult
      to obtain financing through the issuance of equity or debt securities. Even
      if
      we are able to raise the funds required, it is possible that we could incur
      unexpected costs and expenses, fail to collect significant amounts owed to
      us,
      or experience unexpected cash requirements that would force us to seek
      alternative financing. Further, if we issue additional equity or debt
      securities, stockholders may experience additional dilution or the new equity
      securities may have rights, preferences or privileges senior to those of
      existing holders of our common stock. If additional financing is not available
      or is not available on acceptable terms, we will have to curtail our
      operations.





To
      date,
      we have generated minimal revenues from interest income and have incurred
      operating losses in every quarter. Our registered independent auditors have
      stated in their report dated April 10, 2006, that we are an early exploration
      company and have not generated revenues from operations. These factors among
      others may raise substantial doubt about our ability to continue as a going
      concern.





On
      June
      14, 2005, to obtain funding for our ongoing operations, we entered into a
      securities purchase agreement with a single accredited investor pursuant to
      which the investor purchased an 8% convertible debenture with a principal amount
      of $1,000,000, and a warrant to purchase 1,000,000 shares of our common stock,
      exercisable at a price of $1.00 per share until June 15, 2008. Pursuant to
      the
      securities purchase agreement, the investor had the right during the next 60
      days, but not the obligation, to purchase up to $5,000,000 of
      additional




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convertible
      debentures and warrants to purchase 5,000,000 shares of common stock. The
      investor exercised the purchase right and invested the additional $5,000,000
      on
      July 14, 2005, in exchange for an 8% convertible debenture with a principal
      amount of $5,000,000 and a warrant to purchase 5,000,000 shares of our common
      stock, exercisable at a price of $1.00 per share until June 15,
      2008.





The
      convertible debenture is due and payable on June 10, 2007. The principal and
      accrued interest on the convertible debenture may be converted into shares
      of
      our common stock at a rate of $1.00 per share, at the option of the holder.
      The
      investor has contractually agreed to restrict its ability to convert or exercise
      its warrants and receive shares of our common stock such that the number of
      shares of common stock held by it and its affiliates after such conversion
      or
      exercise does not exceed 4.99% of the then issued and outstanding shares of
      our
      common stock.





In
      connection with the private placement, we granted the investor registration
      rights. Pursuant to the registration rights agreement, if we did not file the
      registration statement by August 18, 2005, or if we did not have the
      registration statement declared effective within 120 days thereafter, we are
      obligated to pay liquidated damages in the amount of 1.0% for each 30-day period
      or pro rata for any portion thereof following the date by which such
      registration statement should have been filed for which no registration
      statement is filed. We did not file the registration statement until October
      7,
      2005, however, the investor orally agreed to waive any liquidated
      damages.





***December
      8, 2005 Secured Convertible Debenture Financing***





To
      obtain
      funding for our ongoing operations, we entered into a Securities Purchase
      Agreement with Cornell Capital Partners L.P., an accredited investor, on
      December 8, 2005 for the sale of $15,000,000 in secured convertible debentures.
      They provided us with an aggregate of $15,000,000 as follows:





● $5,000,000
      was disbursed on December 8, 2005;





● $5,000,000
      was disbursed on January 17, 2006; and





● $5,000,000
      was disbursed on June 1, 2006





The
      secured convertible debentures bear interest at 5%, mature three years from
      the
      date of issuance, and are convertible into our common stock, at the selling
      stockholders' option, at the lower of (i) $5.00 or (ii) 90% of the average
      of
      the three lowest daily volume weighted average prices of our common stock,
      as
      quoted by Bloomberg, LP, of the 10 trading days immediately preceding the date
      of conversion. Accordingly, there is in fact no limit on the number of shares
      into which the secured convertible debentures may be converted. As of June
      1,
      2006, the average of the three lowest intraday trading prices for our common
      stock during the preceding 10 trading days as quoted by Bloomberg, LP was $2.85
      and, therefore, the conversion price for the secured convertible notes
      was$2.565. Based on this conversion price, the $15,000,000 in secured
      convertible debentures, excluding interest, were convertible into 5,847,954
      shares of our common stock. The sale of such a large number of shares of common
      stock could significantly deflate the market price of our common stock, which
      would have the further effect of requiring us to issue additional shares upon
      conversion of the secured convertible debentures. Depending on our stock price,
      the conversion of the secured convertible debentures could lead to the sale
      of
      potentially controlling amounts of shares of common stock.





The
      investor has contractually
      agreed to restrict its ability to convert the debentures and receive shares
      of
      our common stock such that the number of shares of common stock held by it
      and
      its affiliates after such conversion does not exceed 4.9% of the then issued
      and
      outstanding shares of common stock. ****





We
      have
      the right, at our option, with three business days advance written notice,
      to
      redeem a portion or all amounts outstanding under the secured convertible
      debentures prior to the maturity date provided that the closing bid price of
      our
      common stock, is less than $5.00 at the time of the redemption. In the event
      of
      a redemption, we are obligated to pay an amount equal to the principal amount
      being redeemed plus a 20% redemption premium, and accrued interest.





In
      connection with the Securities Purchase Agreement dated December 8, 2005, we
      granted the investor registration rights. We are obligated to use our best
      efforts to cause the registration statement to be declared effective no later
      than June 30, 2006 and to insure that the registration statement remains in
      effect until all of the




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shares
      of
      common stock issuable upon conversion of the secured convertible debentures
      have
      been sold. In the event of a default of our obligations under the Registration
      Rights Agreement, including if the registration statement is not declared
      effective by June 30, 2006, we are required pay to Cornell, as liquidated
      damages, for each month that the registration statement has not been filed
      or
      declared effective, as the case may be, either a cash amount or shares of our
      common stock equal to 2% of the liquidated value of the secured convertible
      debentures.





In
      connection with the Securities Purchase Agreement dated December 8, 2005, we
      and
      each of our subsidiaries executed security agreements in favor of the investor
      granting them a first priority security interest in all of our goods, inventory,
      contractual rights and general intangibles, receivables, documents, instruments,
      chattel paper, and intellectual property. The security agreements state that
      if
      an event of default occurs under the secured convertible debentures or security
      agreements, the investors have the right to take possession of the collateral,
      to operate our business using the collateral, and have the right to assign,
      sell, lease or otherwise dispose of and deliver all or any part of the
      collateral, at public or private sale or otherwise to satisfy our obligations
      under these agreements.





**Sample
      Conversion Calculation**





The
      number of shares of common stock issuable upon conversion of the secured
      convertible debentures is determined by dividing that portion of the principal
      of the secured convertible debentures to be converted and interest, if any,
      by
      the conversion price. For example, assuming conversion of the $15,000,000 of
      secured convertible debentures, at a conversion price of $2.565 as of June
      1,
      2006, the number of shares issuable upon conversion would be:





$15,000,000/$2.565
      = 5,847,954 shares





***December
      28, 2005 Convertible Debenture and Warrants Financing***





To
      obtain
      funding for our ongoing operations, we entered into Securities Purchase
      Agreements with two accredited investors on December 28, 2005 for the sale
      of
      (i) $10,000,000 in convertible debentures and (ii) warrants to purchase
      1,250,000 shares of our common stock. The two accredited investors, Bank
      Sal.
      Oppenheim Jr. & Cie., (Schweiz) AG and Centrum Bank each subscribed
      for 50% of the total offering.





The
      investors provided us with an aggregate of $10,000,000 as follows:





● $5,000,000
      was disbursed on December 28, 2005; and





● $5,000,000
      was disbursed on January 23, 2006.





Pursuant
      to the Securities Purchase Agreements, we issued to each investor 625,000
      warrants to purchase shares of common stock on December 28, 2005 and January
      23,
      2006.





The
      convertible debentures bear interest at 7.5%, mature three years from the date
      of issuance, and are convertible into our common stock, at the selling
      stockholders' option, at a rate of $4.00 per share. The
      investors have contractually
      agreed to restrict their ability to convert its debentures or exercise its
      warrants and receive shares of our common stock such that the number of shares
      of common stock held by it and its affiliates after such conversion or exercise
      does not exceed 4.99% of the then issued and outstanding shares of common
      stock. ****





In
      connection with the Securities Purchase Agreement dated December 28, 2005,
      we
      granted the investors registration rights. Pursuant to the registration rights
      agreement, if we do not have the registration statement declared effective
      on or
      before May 27, 2006, we are obligated to pay liquidated damages in the amount
      of
      1.0% for each 30-day period or pro rata for any portion thereof following the
      date by which such registration statement should have been filed for which
      no
      registration statement is filed or should have been declared
      effective.




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**Critical
      Accounting Policies**





*Investment
      in Oil and Gas Properties*





We
      utilize the full cost method to account for our investment in oil and gas
      properties. Accordingly, all costs associated with acquisition and exploration
      of oil and gas reserves, including such costs as leasehold acquisition costs,
      interest costs relating to unproved properties, geological expenditures and
      direct internal costs are capitalized into the full cost pool. As of April
      30,
      2006, we had no properties with proven reserves. When we obtain proven oil
      and
      gas reserves, capitalized costs, including estimated future costs to develop
      the
      reserves and estimated abandonment costs, net of salvage, will be depleted
      on
      the units-of-production method using estimates of proved reserves. Investments
      in unproved properties and major development projects including capitalized
      interest, if any, are not amortized until proved reserves associated with the
      projects can be determined.




The
      capitalized costs included in the full cost pool are subject to a “ceiling
      test”, which limits such costs to the aggregate of the estimated present value,
      using an estimated discount rate, of the future net revenues from proved
      reserves, based on current economic and operating conditions and the estimated
      value of unproven properties.




*Foreign
      Currency Transactions*





Our
      functional currency is the United States dollar and management has adopted
      SFAS
      No. 52, “ *Foreign
      Currency Translation* ”.
      Monetary assets and liabilities denominated in foreign currencies are translated
      into United States dollars at rates of exchange in effect at the balance sheet
      date. Non-monetary assets, liabilities and items recorded in income arising
      from
      transactions denominated in foreign currencies are translated at rates of
      exchange in effect at the date of the transaction.




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**ITEM
      3. CONTROLS AND PROCEDURES**





a)
            *Evaluation
                of Disclosure Controls and Procedures:*As
                of April 30, 2006, our management carried out an evaluation, under
                the
                supervision of our Chief Executive Officer and Chief Financial Officer
                of
                the effectiveness of the design and operation of our system of disclosure
                controls and procedures pursuant to the Securities and Exchange Act,
                Rule
                13a-15(e) and 15d-15(e) under the Exchange Act).  Based on that
                evaluation, our chief executive officer and chief financial officer
                concluded that our disclosure controls and procedures are effective
                to
                provide reasonable assurance that information we are required to
                disclose
                in reports that we file or submit under the Exchange Act is recorded,
                processed, summarized and reported within the time periods specified
                in
                Securities and Exchange Commission rules and forms, and that such
                information is accumulated and communicated to our management, including
                our chief executive officer and chief financial officer, as appropriate,
                to allow timely decisions regarding required
                disclosure.





b)
            *Changes
                in internal controls:*There were no changes in internal controls over financial reporting
                that
                occurred during the period covered by this report that have materially
                affected, or are reasonably likely to materially effect, our internal
                control over financial reporting.






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**PART
      II - OTHER INFORMATION**






**Item
      1. Legal Proceedings.**




From
      time
      to time, we may become involved in various lawsuits and legal proceedings which
      arise in the ordinary course of business. However, litigation is subject to
      inherent uncertainties, and an adverse result in these or other matters may
      arise from time to time that may harm our business. We are currently not aware
      of any such legal proceedings or claims that we believe will have, individually
      or in the aggregate, a material adverse affect on our business, financial
      condition or operating results.





**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**




10.1
              Consulting
                  Agreement, dated as of September 1, 2005, between the Company and
                  MGG
                  Consulting.


31.1
            Certification
                of Chief Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a),
                promulgated under the Securities and Exchange Act of 1934, as
                amended





31.2
            Certification
                of Chief Financial Officer pursuant to Rule 13a-14 and Rule 15d 14(a),
                promulgated under the Securities and Exchange Act of 1934, as
                amended





32.1
            Certification
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002 (Chief Executive
                Officer)





32.2
            Certification
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002 (Chief Financial
                Officer)





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**SIGNATURES**




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




**TRIANGLE
              PETROLEUM CORPORATION**Date: 
June
              6, 2006
            By:
            /s/ MARK
              GUSTAFSONName:  
                Mark Gustafson
              Title:    
                President (Principal Executive
                Officer)




Date: 
June
              6, 2006
            By:
            /s/ ALY
              MUSANIName:  
                Aly Musani
              Title:    
                Chief Financial Officer (Principal Financial Officer and
              Principal Accounting Officer)






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