U.S. Securities
and Exchange Commission

Washington,
D.C. 20549



FORM 10-Q





|[X] | QUARTERLY REPORT PURSUANT
    TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | -------------------------------------------------------------------------------------------



For the Quarterly
Period Ended March 31, 2011





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



For
the Transition Period From ____to _____



Commission
File Number 000-53683











|Nevada
        (State
        or other jurisdiction of
        incorporation
        or organization)                                                                                                                                                                                                                                                                                                                                                                                             | 27-4429450
        (I.R.S.
        employer
        identification
        number)
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------
|16 Market
        Square Center
        1400
        16th Street Suite 400
        Denver,
        CO 80202
        Tel:
        720.932.8389
        Fax:
        720.932.8189
        (Address
        of principal executive offices and zip code)
        
        Copies
        to:
        Davis
        Graham & Stubbs LLP
        1550
        Seventeenth Street, Suite 500
        Denver,
        CO 80202
        Phone:
        (303) 892-7344
        Fax:
        (303) 893-1379



Indicate by
check mark whether the registrant (1) has 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
[ ]



Indicate by
check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding
12 months (or such shorter period that the registrant was required to submit and post such files).

Yes [ ]                                No
[ ]



Indicate by
check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting
company” in Rule 12b-2 of the Exchange Act.



|Large accelerated filer   | £
|------------------------- | -
|Non-accelerated filer     | £
|Accelerated filer         | £
|Smaller reporting company | S



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

Yes [ ]                              No
[X]



Number of shares of common stock
outstanding as of May 13, 2011: 92,952,085

















|PART I                                                                                             | Page No.
|-------------------------------------------------------------------------------------------------- | --------
|                                                                                                   |         
|Item 1.  Financial Statements                                                                      | 2       
|                                                                                                   |         
|Item 2.  Management's Discussion and Analysis of Financial Condition and Results
    of Operations | 10      
|                                                                                                   |         
|Item 3.  Quantitative and Qualitative Disclosures About Market Risk                                | 13      
|                                                                                                   |         
|Item 4.  Controls and Procedures                                                                   | 13      
|                                                                                                   |         
|Item 4T. Controls and Procedures                                                                   | 13      
|                                                                                                   |         
|PART II                                                                                            |         
|                                                                                                   |         
|Item 1.  Legal Proceedings                                                                         | 13      
|                                                                                                   |         
|Item 1A. Risk Factors                                                                              | 13      
|                                                                                                   |         
|Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds                               | 13      
|                                                                                                   |         
|Item 3.  Defaults Upon Senior Securities                                                           | 13      
|                                                                                                   |         
|Item 4.  Submission of Matters to a Vote of Security Holders                                       | 13      
|                                                                                                   |         
|Item 5.  Other Information                                                                         | 13      
|                                                                                                   |         
|Item6.  Exhibits                                                                                   | 13      
|                                                                                                   |         





(1)


Table of Contents










ITEM 1. FINANCIAL STATEMENTS



INDEX TO AMERICAN POWER CORP. FINANCIAL
STATEMENTS



|AMERICAN POWER CORPORATION        |  | PAGE |  
|--------------------------------- |  | ---- | -
|                                  |  |      |  
|Balance Sheets                    |  |      | 4
|                                  |  |      |  
|Statements of Operations          |  |      | 5
|                                  |  |      |  
|Statement of Stockholders’ Equity |  |      | 6
|                                  |  |      |  
|Statements of Cash Flows          |  |      | 7
|                                  |  |      |  
|Notes to Financial Statements     |  |      | 8



(3)


Table of Contents






|AMERICAN POWER CORP.                                                                                                                                                
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(An Exploration Stage Company)                                                                                                                                      
|BALANCE SHEETS                                                                                                                                                      
|ASSETS                                                                                                                                                              
|CURRENT ASSETS                                                                                                                                                      
|                                                                                                                                                                    
|                                                                                                                                                                    
|Cash                                                                                                                                                                
|Prepaids and deposit                                                                                                                                                
|Advances to related party                                                                                                                                           
|TOTAL CURRENT ASSETS                                                                                                                                                
|                                                                                                                                                                    
|OTHER ASSETS                                                                                                                                                        
|Mineral property                                                                                                                                                    
|Equipment - net                                                                                                                                                     
|Website - net                                                                                                                                                       
|TOTAL ASSETS                                                                                                                                                        
|                                                                                                                                                                    
|LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                
|CURRENT   LIABILITIES                                                                                                                                               
|Accounts payable and accrued liabilities                                                                                                                            
|Promissory notes, current portion                                                                                                                                   
|TOTAL CURRENT LIABILITIES                                                                                                                                           
|                                                                                                                                                                    
|LONG TERM LIABILITIES                                                                                                                                               
|Promissory notes, net of current portion,
    net of debt discount of $935,067 ($1,105,729 September 30, 2010)                                                      
|TOTAL LIABILITIES                                                                                                                                                   
|                                                                                                                                                                    
|STOCKHOLDERS’   EQUITY                                                                                                                                              
|Capital stock                                                                                                                                                       
|Authorized 500,000,000 shares of common stock, $0.001 par value.       
    Issued and outstanding 92,034,880 shares of common stock (90,480,000 September 30, 2010)
|Additional paid in
    capital                                                                                                                                      
|Stock payable                                                                                                                                                       
|Accumulated deficit during exploration stage                                                                                                                        
|TOTAL STOCKHOLDERS’ EQUITY                                                                                                                                          
|TOTAL LIABILITIES
    AND STOCKHOLDERS’  EQUITY                                                                                                                     







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



(4)


Table of Contents










|AMERICAN POWER
    CORP. (An Exploration Stage Company) STATEMENTS OF OPERATIONS (Unaudited)
|--------------------------------------------------------------------------------------------
|                                                                                            



|                                                                |  | Three
    Months Ended March 31, |            | Six
    Months Ended March 31, |  | Cumulative results
    from inception (August 7, 2007) to March 31, 2011
|--------------------------------------------------------------- |  | -------------------------------- | ---------- | ------------------------------ |  | ------------------------------------------------------------------------
|                                                                |  |                                  | 2011       |                                |  |                                                                         
|                                                                |  |                                  |            |                                |  |                                                                         
|REVENUES                                                        |  |                                  |            |                                |  |                                                                         
|                                                                |  |                                  |            |                                |  |                                                                         
|Revenues                                                        |  | $                                | —          |                                |  |                                                                         
|Total revenues                                                  |  |                                  | —          |                                |  |                                                                         
|                                                                |  |                                  |            |                                |  |                                                                         
|EXPENSES                                                        |  |                                  |            |                                |  |                                                                         
|                                                                |  |                                  |            |                                |  |                                                                         
|Office and general                                              |  |                                  | 87,703     |                                |  |                                                                         
|Management fees                                                 |  |                                  | 320,833    |                                |  |                                                                         
|Professional fees                                               |  |                                  | 31,168     |                                |  |                                                                         
|Gain on debt forgiveness                                        |  |                                  | —          |                                |  |                                                                         
|Exploration costs                                               |  |                                  | 30,649     |                                |  |                                                                         
|Total expenses                                                  |  |                                  | (470,353   | )                              |  |                                                                         
|                                                                |  |                                  |            |                                |  |                                                                         
|OTHER INCOME (EXPENSE)                                          |  |                                  |            |                                |  |                                                                         
|Interest expense                                                |  |                                  | (82,169    | )                              |  |                                                                         
|Loss on debt settlement                                         |  |                                  | —          |                                |  |                                                                         
|Total other expenses                                            |  |                                  | (82,169    | )                              |  |                                                                         
|                                                                |  |                                  |            |                                |  |                                                                         
|NET LOSS                                                        |  | $                                | (552,522   | )                              |  | $                                                                       
|                                                                |  |                                  |            |                                |  |                                                                         
|BASIC LOSS PER COMMON SHARE                                     |  |                                  |            |                                |  |                                                                         
|                                                                |  | $                                | (0.01      | )                              |  | $                                                                       
|                                                                |  |                                  |            |                                |  |                                                                         
|WEIGHTED AVERAGE NUMBER OF COMMON SHARES
    OUTSTANDING- BASIC |  |                                  |            |                                |  |                                                                         
|                                                                |  |                                  |            |                                |  |                                                                         
|                                                                |  |                                  | 91,603,914 |                                |  |                                                                         







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





(5)


Table of Contents








|AMERICAN
    POWER CORP.                                                                                                                 
|-----------------------------------------------------------------------------------------------------------------------------------------
|(An Exploration
    Stage Company)                                                                                                       
|STATEMENT OF
    STOCKHOLDERS' EQUITY (DEFICIT)                                                                                          
|From inception
    (August 7, 2007) to March 31, 2011                                                                                    
|(Unaudited)                                                                                                                              
|                                                                                                                                         
|                                                                                                                                         
|                                                                                                                                         
|Balance, August 7, 2007 (Inception)                                                                                                      
|Common stock issued for cash at $0.001 per share
    on August 13, 2007                                                                  
|Net loss                                                                                                                                 
|Balance, September 30, 2007                                                                                                              
|                                                                                                                                         
|Subscription Receivable                                                                                                                  
|Common stock issued for cash at $0.03 per share July and August
    2008                                                                 
|Net loss                                                                                                                                 
|Balance, September 30, 2008                                                                                                              
|                                                                                                                                         
|Net loss                                                                                                                                 
|Balance, September 30, 2009                                                                                                              
|                                                                                                                                         
|Forgiveness of debt by former director                                                                                                   
|Common Stock, issued for mineral property at $0.05 per share
    April 9, 2010                                                           
|Common stock issued for cash at $0.50 per share June 25, 2010                                                                            
|Common stock  to be issued on debt totalling $208,603 (including
    interest of $8,603) conversion at $0.50 per share September 10, 2010
|Common stock to be issued for services at $0.96 per share at
    September 30, 2010                                                      
|Private placement received in advance                                                                                                    
|Net loss                                                                                                                                 
|Balance,   September 30, 2010                                                                                                            
|                                                                                                                                         
|Common stock issued for 595,238 units at $0.84 per unit on October
    5, 2010                                                           
|Common stock issued for 449,438 units at $0.89 per unit on January
    25, 2011                                                          
|Common stock issued for 510,204 units at $0.98 per unit on February
    23, 2011                                                         
|Common stock to be issued for services at March 31, 2011                                                                                 
|Net loss                                                                                                                                 
|Balance,   March 31, 2011                                                                                                                
|                                                                                                                                         
|                                                                                                                                         
|The accompanying
    notes are an integral part of these financial statements                                                            





(6)


Table of Contents












|AMERICAN POWER
    CORP.                                                                  
|------------------------------------------------------------------------------------------
|(An Exploration
    Stage Company)                                                        
|STATEMENTS OF
    CASH FLOWS                                                              
|(Unaudited)                                                                               
|                                                                                          
|                                                                                          
|CASH FLOWS FROM OPERATING ACTIVITIES                                                      
|Net loss                                                                                  
|Adjustment to reconcile net loss to net cash                                              
|used in operating activities                                                              
|Depreciation and amortization                                                             
|Stock-based compensation                                                                  
|Accretion of debt discount                                                                
|Gain on extinguishment of debt                                                            
|Loss on extinguishment of debt                                                            
|(Increase) in prepaid expenses                                                            
|Decrease in advances to/from  related party                                               
|Increase in accounts payable and accrued
    liabilities                                  
|NET CASH USED IN OPERATING
    ACTIVITIES                                                 
|                                                                                          
|CASH FLOWS FROM INVESTING ACTIVITIES                                                      
|Website                                                                                   
|Equipment                                                                                 
|Mineral property                                                                          
|NET CASH USED IN INVESTING
    ACTIVITIES                                                 
|                                                                                          
|CASH FLOWS FROM FINANCING ACTIVITIES                                                      
|Proceeds from sale of common stock                                                        
|Loans from related party                                                                  
|Proceeds from notes payable                                                               
|Payment on promissory note                                                                
|NET CASH PROVIDED BY
    FINANCING ACTIVITIES                                             
|                                                                                          
|NET INCREASE IN CASH                                                                      
|                                                                                          
|CASH, BEGINNING OF PERIOD                                                                 
|                                                                                          
|CASH, END OF PERIOD                                                                       
|                                                                                          
|Supplemental cash flow information and noncash financing activities:                      
|Common stock payable for property acquisition                                             
|Promissory notes issued for property                                                      
|Forgiveness of debt by former director                                                    
|Common stock issued to satisfy common stock payable                                       
|Conversion of debt totalling $208,603, (including interest of
    $8,603) for common stock
|                                                                                          
|The accompanying notes are
    an integral part of these financial statements             







(7)


Table of Contents












AMERICAN POWER
CORP.

(An Exploration
Stage Company)

NOTES TO FINANCIAL
STATEMENTS

March 31,
2011

(Unaudited)



NOTE 1 –FINANCIAL STATEMENTS



Pursuant to
the rules and regulations of the Securities and Exchange Commission for Form 10-Q, the financial statements, footnote disclosures
and other information normally included in financial statements prepared in accordance with generally accepted accounting principles
have been omitted. The financial statements contained in this report are unaudited but, in the opinion of management, reflect
all adjustments, consisting of only normal recurring adjustments necessary for a fair presentation of the financial statements.
The results of operations for any interim period are not necessarily indicative of results for the full year. The balance sheet
at September 30, 2010 has been derived from the audited financial statements at that date but does not include all of the information
and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.



NOTE 2 – GOING CONCERN



The Company’s
financial statements as of March 31, 2011 have been prepared using generally accepted accounting principles in the United States
of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal
course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs
and allow it to continue as a going concern. For the six months ended March 31, 2011, and from inception (August 7, 2007) to March
31, 2011, the Company had a net loss of $1,012,837 and $1,826,885, respectively.



In order to
continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan
is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet
its minimal operating expenses and seeking equity and/or debt financing. However management cannot provide any assurances that
the Company will be successful in accomplishing any of its plans.



The ability
of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in
the preceding paragraph and eventually secure other sources of financing and attain profitable operations. These financial statements
do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of
liabilities that might be necessary should the Company be unable to continue as a going concern.



NOTE 3 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES



Stock based compensation

The Company
recognizes stock-based compensation in accordance with ASC Topic 718 “Stock Compensation”, which requires the measurement
and recognition of compensation expense for all share-based payment awards made to employees and directors including employee
stock options and employee stock purchases related to an Employee Stock Purchase Plan based on the estimated fair values.



For non-employee
stock-based compensation, the Company has adopted ASC Topic 505 “Equity-Based Payments to Non-Employees”, which requires
stock-based compensation related to non-employees to be accounted for based on the fair value of the related stock or options
or the fair value of the services on the grant date, whichever is more readily determinable in accordance with ASC Topic 505.



Cash and
cash equivalents

Cash and cash
equivalents include highly liquid investments with original maturities of three months or less



Use of Estimates and Assumptions

Preparation
of the financial statements in conformity with accounting principles generally accepted in the United States requires management
to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results
could differ from those estimates.





(8)


Table of Contents










AMERICAN POWER
CORP.

(An Exploration
Stage Company)

NOTES TO FINANCIAL
STATEMENTS

March 31,
2011

(Unaudited)



NOTE 3 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES -(continued)



Net Loss
per Share

Basic loss per
share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of
common shares outstanding for the period.  Dilutive loss per share reflects the potential dilution of securities that
could share in the losses of the Company.  Because the Company does not have any potentially dilutive securities, the
accompanying presentation is only of basic loss per share.



Fair Value of Financial Instruments

The carrying
amounts of the financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and accrued
liabilities, approximate fair value due to the short maturities of these financial instruments. The notes payable are also considered
financial instruments whose carrying amounts approximate fair values.



Fixed Assets

Fixed assets
are stated at cost.  Major renewals and improvements are charged to the asset accounts while replacements, maintenance
and repairs, which do not improve or extend the lives of the respective assets, are expensed.  At the time property
and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation accounts are relieved of the
applicable amounts.  Gains or losses from retirements or sales are credited or charged to income.



The Company’s
fixed assets consist of computer equipment, which is valued at cost and depreciated using the straight-line method over a period
of four years.



NOTE 4
- RECENT ACCOUNTING PRONOUNCEMENTS AFFECTING THE COMPANY



There have been
no recent accounting pronouncements or changes in accounting pronouncements that impacted the second quarter of fiscal 2011, or
which are expected to impact future periods, which were not already adopted and disclosed in prior periods.



NOTE 5 - CAPITAL STOCK



On October 5,
2010, the Company entered into a Private Placement Subscription for Non U.S. Subscribers with Black Sands Holdings, Inc., to subscribe
to and purchase 595,238 units valued at $0.84 per unit for an aggregate purchase price of $500,000.  Each unit comprises
one share of common stock and one warrant of the Company.  Each warrant entitles the holder to purchase one additional
share of common stock of the Company at an exercise price of $1.26 per share for a period of three years.



During the quarter
ended December 31, 2010, the Company recorded $265,000 for stock-based compensation payable related to 250,000 shares of common
stock earned by Mr. Alvaro Valencia, CEO and Director of the Company. On October 31, 2010, under the Independent Consultant Agreement
between the Company and the CEO, 250,000 shares of common stock vested and were valued based on the closing price of our shares
of common stock on October 31, 2010.



During the quarter
ended March 31, 2011, the Company recorded $293,333 for stock-based compensation payable related to 250,000 shares of common stock
earned by Mr. Alvaro Valencia, CEO and Director of the Company. On January 31, 2011, under the Independent Consultant Agreement
between the Company and the CEO, 250,000 shares of common stock vested and were valued based on the closing price of our shares
of common stock on January 31, 2011. At September 30, 2010, December 31, 2010 and March 31, 2011, 166,667 shares of common stock
were recorded in stock payable on the balance sheet and at an estimated value based on the closing price our shares of common
stock at September 30, 2010, December 31, 2010 and March 31, 2011, respectively.



On January 25,
2011, the Company entered into a Private Placement Subscription for Non U.S. Subscribers with Black Sands Holdings, Inc., to subscribe
to and purchase 449,438 units valued at $0.89 per unit for an aggregate purchase price of $400,000.  Each unit comprises
one share of common stock and one warrant of the Company.  Each warrant entitles the holder to purchase one additional
share of common stock of the Company at an exercise price of $1.34 per share for a period of three years.



On February
23, 2011, the Company entered into a Private Placement Subscription for Non U.S. Subscribers with Black Sands Holdings, Inc.,
to subscribe to and purchase 510,204 units valued at $0.98 per unit for an aggregate purchase price of $500,000.  Each
unit comprises one share of common stock and one warrant of the Company.  Each warrant entitles the holder to purchase
one additional share of common stock of the Company at an exercise price of $1.47 per share for a period of three years.



NOTE 6 – SUBSEQUENT EVENTS



On April
5, 2011, the Company issued 417,205 shares to settle the debt to equity conversion agreement entered into during the prior year,
as a means of settling an outstanding loan and interest amount of $208,603. The fair value of the shares was $446,410, of which
$237,807 was recognized as a loss on debt settlement in the statement of operations in the prior year.

Additionally
on April 5, 2011, the Company issued a total of 500,000 shares to Mr. Alvaro Valencia, CEO and Director of the Company, as per
his Independent Consultant Agreement. These shares were previously recorded as a stock payable.



(9)


Table of Contents














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



Note Regarding
Forward-Looking Statements



This
quarterly report on Form 10-Q and other reports filed by the Company from time to time with the Securities and Exchange Commission
(collectively the “Filings”) contain or may contain forward-looking statements and information that are based upon
beliefs of, and information currently available to, Company’s management as well as estimates and assumptions made by Company’s
management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions
and speak only as of the date hereof. When used in the filings, the words “anticipate”, “believe”, “estimate”,
“expect”, “future”, “intend”, “plan”, or the negative of these terms and similar
expressions as they relate to Company or Company’s management identify forward-looking statements. Such statements reflect
the current view of Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors
(including the risks contained in the section of operations and results of operations, and any businesses that Company may acquire.)
Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results
may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.



Although
Company believes that the expectations reflected in the forward-looking statements are reasonable, Company cannot guarantee future
results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws
of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements
to actual results. Readers are urged to carefully review and consider the various disclosures made throughout the entirety of
this quarterly report, which attempt to advise interested parties of the risks and factors that may affect our business, financial
condition, results of operations, and prospects.



Overview



American
Power Corp (which we refer to herein as the “Company”, “us” or “we”) was incorporated in the
State of Nevada as a for-profit company on August 7, 2007. We are an exploration stage company whose intended business purpose
is coal, oil and natural gas exploration, development and production. At the time of our incorporation, we were incorporated under
the name “Teen Glow Makeup, Inc.” and our original business plan was to create a line of affordable teen makeup for
girls. On November 20, 2009, Johannes Petersen acquired the majority of the shares of our issued and outstanding common stock
in accordance with two stock purchases agreements by and between Mr. Petersen and Ms. Pamela Hutchinson, and Ms. Andrea Mizushima,
respectively. On March 31, 2010, we changed our intended business purpose to that of coal, oil and natural gas exploration, development
and production.



Our
current primary business focus is to acquire, explore and develop coal, oil and gas exploration properties in the United States
of North America, with a particular focus on the Rocky Mountain region. On March 30, 2010, our Board of Directors approved the
proposal to change the Company’s name and to effect a 340 for 1 forward stock split. The Certificate of Change for the forward
stock split was filed with and approved by the Nevada Secretary of State on April 28, 2010. Also on April 28, 2010, Articles of
Amendment were filed and approved with the Nevada Secretary of State to change the name of the Corporation to American Power Corp.
The Articles of Amendment also changed the authorized amount of capital stock to Five Hundred Million (500,000,000) shares of
Common Stock, par value $0.001.



(10)


Table of Contents






Business
Description and Plan of Operation



Our
plan of operation is to acquire and explore mineral properties and prospects in order to ascertain whether they possess economic
quantities of coal and/or hydrocarbons in accordance with available funds. There can be no assurance that an economic coal and/or
hydrocarbon reserve exists on any of the exploration prospects we acquire until appropriate exploration work is completed.



Coal,
oil and gas exploration is typically conducted in phases. Each subsequent phase of exploration work is recommended by a geologist
based on the results from the most recent phase of exploration. We have yet to acquire exploration properties, upon which we will
commence the initial phase of exploration.  We have acquired an assignment of certain contractual rights in coal and
minerals located in Judith Basin County, Montana, collectively described as the “Pace Coal Project”, however these
rights are speculative in nature and additional exploration work is required to determine their value. In that regard, an exploration
drilling program consisting of three phases has been planned for the Pace Coal Project this year. Once we have completed each
phase of the exploration drilling program, we will make a decision as to whether or not we proceed with the development of the
Pace Coal Project based upon the analysis of the results of that program. Even if we complete our proposed exploration program
on the Pace Coal Project or on other properties that we acquire in the future, and we are successful in identifying the presence
of coal and/or hydrocarbons, we will have to spend substantial funds on further drilling, engineering studies, environmental and
mine feasibility studies before we will know if we have a commercially viable coal, oil and gas deposit or reserve.



Market Overview
for Plan of Operation



Coal
production in the United States in 2010 reached a level of 1,085.3 million short tons (1,074.9 million short tons in 2009) according
to data from the Energy Information Administration (EIA), an increase of 0.9% from the 2009 level. In spite of this increase,
coal production in 2010 is still 7.4% lower than the level reached in 2008 (1,171.8 million short tons).



Coal
consumption in the United States in 2010 reached a level of 1,048.3 million short tons (997.5 million short tons in 2009), an
increase of 5.1% from the 2009 level, with all of the coal-consuming sectors experiencing higher consumption for the year, with
the only exception of the commercial and institutional sector. Although all sectors had increases, the electric power sector (electric
utilities and independent power producers), which consumed about 93% of all coal in the US in 2010, has been and continues to
be the overriding force for determining total domestic coal consumption. In 2010, coal consumption for the electric power sector
reached 975.6 million short tons, an increase of 4.5% from the 2009 level (933.6 million short tons). Coal consumption in the
non-electric power sector (comprised of other industrial, coking coal, and the commercial and institutional sectors) increased
13.1% in 2010, after experiencing declines for five consecutive years. Coal consumption at coke plants increased by 37.6% to end
2010 at 21.1 million short tons (15.3 million short tons in 2009).



Total
coal stockpiles have begun to return to pre-recession levels, decreasing in 2010 by 8.4% to end the year at 224.3 million short
tons, after posting a record level of 244.8 million short tons in 2009.



Domestic
coal prices continued to increase, rising for the seventh consecutive year.. According to data for 2010, the average price of
coal delivered to the electric power sector increased by 4.2% to $2.22 per million Btu over the 2009 level. The average delivered
price of coal to the other industrial sector decreased by 1.0% to an average price of $64.24 per short ton in 2010 while the delivered
price of coal to US coke plants increased by 7.4% to reach an average price of $153.59 per short ton. The average delivered price
of coal to the commercial and institutional sector decreased in 2010 by 9.1% to $88.42 per short ton.



Western Region (includes Montana)



The
Western Region is the largest coal-producing region in the US, concentrating 54.6% of total US coal production in 2010. Coal production
in this region increased by 1.1% in 2010 to a total of 591.6 million short tons.



In
2010, Montana, the second largest coal-producing State in the Western Region, produced a total of 44.7 million short tons, an
increase of 13.3% over the 2009 level.



Results
of Operations for the Six and Three Months ended March 31, 2011 and 2010



Revenues



The Company has
yet to generate any revenues.



(11)


Table of Contents










Expenses



Six months ended March 31, 2011 compared to
the Six months ended March 31, 2010



We
had a net loss of $1,012,837 for the six months ended March 31, 2011, which was $992,246 greater than the net loss of $20,591
for the six months ended March 31, 2010. This increase in net loss in the current period is primarily the result of an increase
in share-based compensation to our CEO, office and general expenses, an increase in professional and management fees and mineral
property exploration costs. Interest expense of $170,661 for the six months ended March 31, 2011, as compared to nil for the 2010
period, is accretion related to debt discount recorded on the promissory notes. For the six months ended March 31, 2010, the promissory
notes were not outstanding and, as such, no interest expense was recorded.



Three months ended March 31, 2011 compared
to the three months ended March 31, 2010



We
had a net loss of $470,353 for the three months ended March 31, 2011, which was $456,216 greater than the net loss of $14,137
for the three months ended March 31, 2010. This increase in net loss in the current period is primarily the result of an increase
in share-based compensation to our CEO, office and general expenses, an increase in professional and management fees and mineral
property exploration costs. Interest expense of $82,169 for the three months ended March 31, 2011, as compared to nil for the
2010 period, is accretion related to debt discount recorded on the promissory notes. For the three months ended March 31, 2010,
the promissory notes were not outstanding and, as such, no interest expense was recorded.



Liquidity and Capital Resources



Our
balance sheet as of March 31, 2011, reflects current assets of $784,598 which includes cash of $729,645. Our working capital at
March 31, 2011 is $540,796.



Working Capital (Deficit)

|                          |  | At March 31, 2010 |         | At September
    30, 2010
|------------------------- |  | ----------------- | ------- | -------------------------
|                          |  |                   |         |                          
|Current assets            |  | $                 | 784,598 |                          
|Current liabilities       |  |                   | 243,802 |                          
|Working capital (deficit) |  | $                 | 540,796 |                          



Operating
Activities



Net
cash flows used in operating activities were $283,453 and $15,084 for the six months ended March 31, 2011 and 2010, respectively.
Negative cash flows are primarily attributable to a net loss of $1,012,837 and $20,591 for the six months ended March 31, 2011
and 2010, respectively.



Investing
Activities



Net
cash flows used in investing activities were $7,754 and $9,375 for the six months ended March 31, 2011 and 2010, respectively.
Negative cash flows for the six months ended March 31, 2011 was due to the website expenditures of $7,754.



Financing
Activities



Net
cash flows provided by financing activities were $500,000 and $27,116 for the six months ended March 31, 2011 and 2010, respectively.
During the six months ended March 31, 2011 we issued units of comprising shares of our common stock and warrants for total proceeds
of $900,000 and made payments of $400,000 on promissory notes.



|                                          |  | Six-months Ended
|----------------------------------------- |  | ----------------
|                                          |  | March 31,       
|                                          |  | 2011            
|                                          |  |                 
|Net Cash Used in Operating Activities     |  | $               
|Net Cash Used in Investing Activities     |  |                 
|Net Cash Provided by Financing Activities |  |                 
|Net Increase (Decrease) in Cash           |  | $               



Off-Balance Sheet Arrangements



As
of 31 March, 2011, we had no existing off-balance sheet arrangements, as defined under SEC rules.





(12)


Table of Contents








ITEM 3.  QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



Not required by smaller reporting
companies.



ITEM 4. CONTROLS AND PROCEDURES



We maintain
disclosure controls and procedures designed to ensure that information required to be disclosed in reports filed under the Securities
Exchange Act of 1934 (“Exchange Act”) is recorded, processed, summarized and reported within the specified time periods.
Our Chief Executive Officer and its Chief Financial Officer (collectively, the “Certifying Officers”) are responsible
for maintaining our disclosure controls and procedures. The controls and procedures established by us are designed to provide
reasonable assurance that information required to be disclosed by the issuer in the reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules
and forms.



As of March
31, 2011, the Certifying Officers evaluated the effectiveness of our disclosure controls and procedures. Based on the evaluation,
the Certifying Officers concluded that our disclosure controls and procedures were not effective to provide reasonable assurance
that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated
to our management, including the Certifying Officers, as appropriate to allow timely decisions regarding required disclosure.



The Certifying
Officers have also concluded, based on their evaluation of our controls and procedures that as of March 31, 2011, our internal
controls over financial reporting are not effective and provide no reasonable assurance of achieving their objective.



The Certifying
Officers have also concluded that there was no change in our internal controls over financial reporting identified in connection
with the evaluation that occurred during our fiscal quarter that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting.



PART II.  OTHER INFORMATION



ITEM 1.     
LEGAL PROCEEDINGS



The Company
is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated.



No director,
officer, or affiliate of the issuer and no owner of record or beneficiary of more than 5% of the securities of the issuer, or
any security holder is a party adverse to the small business issuer or has a material interest adverse to the small business issuer.





ITEM 1A.   RISK
FACTORS



The information to be reported under
this item has not changed since the previously filed 10K, for the year ended September 30, 2010.



ITEM 2.     
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS



Not applicable.



ITEM 3.     
DEFAULTS UPON SENIOR SECURITIES



We have not had any default upon
senior securities.



ITEM 4.     
(Removed and Reserved)



None



ITEM 5.     
OTHER INFORMATION



We do not have any other information
to report.



ITEM 6.     
EXHIBITS



31.1 CEO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

31.2 CFO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

32.1 CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

32.2 CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*



* Filed herewith







(13)


Table of Contents










SIGNATURES



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



|                   |                                                                                    |                                                                                
|------------------ | ---------------------------------------------------------------------------------- | -------------------------------------------------------------------------------
|                   | AMERICAN POWER
                    CORPORATION
        (Registrant)               
|                   |                                                                                    |                                                                                
|Date: May 13, 2011 | By:                                                                                | /s/ Alvaro Valencia                                                            
|                   |                                                                                    | Alvaro Valencia
        Chief Executive Officer,
        President and Director
|                   |                                                                                    |                                                                                
|                   |                                                                                    |                                                                                
|Date: May 13, 2011 | By:                                                                                | /s/ Johannes Petersen                                                          
|                   | Johannes Petersen
        Chief Financial Officer,
        Secretary, and Director