----

**United      States**

**Securities      And Exchange Commission**

**Washington,      D.C. 20549**

**_________________**

**FORM 10-K/A**

**AMENDMENT      NO.1**

**_________________**

| [X]                | ANNUAL                REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE                ACT OF                1934     |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------|
|               | For                the fiscal year ended December 31, 2004                                                                  |
|               |                                                                                                                                  |
| [                ] | TRANSITION                REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES                EXCHANGE ACT OF 1934 |
|               | For                the transition period from ___________ to                ___________                                               |

| **ENERGY                EXPLORATION TECHNOLOGIES INC**                        |
|-------------------------------------------------------------------------------|
| (Exact                name of registrant as specified in its charter)         |
|  **Alberta,                Canada**                                      |   |  **N/A** |
| (State                or other jurisdiction of incorporation or organization) |   | (I.R.S.                Employer Identification No.) |
| **700-840-7                Avenue SW, Calgary, Alberta, Canada,**             | **T2P                3G2** |
| (Address                of principal executive offices)                       | (Zip                Code) |

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**Business      **
**Strategy**

| · | through                the development or sale of our current inventory of                properties;                                                                                                                                                               |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | by                providing SFD survey services to third parties on a fee for service                basis;                                                                                                                                                         |
| · | by                using the SFD survey technology to identify oil and gas prospects                that                have the potential to justify the acquisition of mineral rights for                oil                and gas developments;                  |
| · | through                the use of conventional exploration technologies to confirm the oil                and                gas prospects identified with the SFD survey                technology;                                                                |
| · | by                either directly participating in the selection of drilling locations                or                joint venturing with partners who will earn an interest by drilling                the                prospects at their cost and risk; and |
| · | by                the monetization of the properties as they reach the development                stage.                                                                                                                                                            |

**Stress      Field Detector Technology**

**Summary**

|   | Identification                of the source of energy causing the SFD sensor response was discovered                as                a result of experimentation and                observation. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In                Petroleum Engineering technical literature there is a substantial                body of                research on the identification and application of stress fields associated                with optimization of production operations for oil and gas. Determination                of stress fields is also important in the operation of underground                mines.                Understanding stress fields associated with subsurface rocks is important                to several industrial sectors. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | The                SFD sensor is the first device to our knowledge that can remotely                measure                the gradient of stress energy related to rocks in the subsurface.                The SFD                shows a measurable multiple sensor response to the presence of                faults. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | George                Liszicasz and NXT have maintained the confidentiality of the design                of the                SFD to preserve the competitive advantage of the company. No patents                have                been sought in respect of the SFD because the technology continues                to be                improved and enhanced and there is a possibility that future modifications                could be made to the concepts and Sensors that would not be subject                to the                patent thereby nullifying NXT’s competitive                advantage. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**SFD      Development History**

**Theoretical      Basis**

----

**SFD      Response**

**SFD      Survey System**

| · | ***Stress                Field Detector*****—**the                stress field detector or SFD is a unit, which houses the SFD sensor,                the                principal component of our technology. As discussed above, the SFD                sensor                is a passive transducer that interacts with energy fields created                by                subsurface stresses and registers that interaction in the form of                digital                electronic signals. When NXT conducts SFD surveys, we use an SFD                array                incorporating twelve interchangeable SFD sensors, which allows us                to                collect twelve sets of SFD signals. The ability to collect data from                multiple SFD sensors is important for several reasons. First, it                facilitates repeatability and signal verification, and cuts down                on the                need for additional SFD survey flights. Second, we use different                SFD                sensor designs, which allow us to collect different qualitative                information. For example, one design of SFD sensor appears to better                identify anomalies associated with subsurface structures, while another                design appears to offer more information concerning faults and a                third                appears to offer information concerning the quality of the reservoir                in                the subsurface structure. Finally, the SFD sensors are extremely                sensitive                devices, and the operational ability of any one sensor while on an                SFD                survey flight may be adversely impacted. The array of twelve sensors                provides a population of three of each type of sensor and ensures                that the                quality of data recorded remains high. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | ***Data                Acquisition System*****—**used                in conjunction with the SFD sensor array on surveys, our data acquisition                system is a compact, portable computer system which concurrently                acquires                the twelve electronic digital signals from the SFD array in two different                data formats per sensor or twenty-four signal sets in total, marks                each of                the signal sets with their geographic location using global positioning                satellite coordinates and then stores this information for subsequent                processing and interpretation at our home base.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |

| · | ***Data                Processing and Interpretation Systems*****—**once                returned to our home base, the SFD data collected is processed and                converted into a format that can be used by our interpretive staff.                All                processing is performed by our staff using computer workstations                and                processing software, which has been developed in-house. Once the                SFD data                has been processed, our geological and geophysical staff review the                data,                plot the flight lines and produce computer-generated base maps using                our                processing software and industry standard mapping software and                databases. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*dollars*
*Foreign        Currency Translation*

**Special        Note Regarding The Observations, Beliefs And Opinions Expressed In This Annual        Report Relating To The Scientific Basis And Principles Of Our SFD        Technology**
** **

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**TABLE        OF CONTENTS**

| **PART                  I**                                                                                                                     | **Page** |
|-------------------------------------------------------------------------------------------------------------------------------------------------|----------|
| Item                  1. Business                                                                                                               | 4        |
| Item                  2. Properties                                                                                                             | 20       |
| Item                  3. Legal Proceedings                                                                                                      | 21       |
| Item                  4. Submission of Matters to a Vote of Security Holders                                                                    | 21       |
| **PART                  II**                                                                                                                    |     |
| Item                  5. Market for the Registrant’s Common Shares and Related Stockholder                  Matters.                      | 22       |
| Item                  6. Selected Financial Data                                                                                                | 25       |
| Item                  7. Management’s Discussion and Analysis of Financial Condition and Results                  Of Operations           | 27       |
| Item                  7A. Quantitative and Qualitative Disclosures About Market                  Risk                                           | 36       |
| Item                  8. Financial Statements and Supplementary Data                                                                            | 38       |
| Item                  9. Changes in and Disagreements with Accountants on Accounting                  and Financial                  Disclosure | 68       |
| Item                  9A. Controls and Procedures                                                                                               | 69       |
| **PART                  III**                                                                                                                   |     |
| Item                  10. Directors and Executive Officers of the Registrant                                                                    | 69       |
| Item                  11. Executive Compensation                                                                                                | 73       |
| Item                  12. Security Ownership of Certain Beneficial Owners and                  Management                                       | 76       |
| Item                  13. Certain Relationships and Related Transactions                                                                        | 79       |
| Item                  14. Principal Accounting Fees and Services                                                                                | 79       |
| **PART                  IV**                                                                                                                    |     |
| Item                  15. Exhibits, Financial Statement Schedules and Reports on Form                  8-K                                      | 80       |

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**PART        I**

**Item        1. Business**

**Overview**

**Corporate        History**

----

**Corporate        Objective**

----

**SFD      Data Interpretation**

| · | First,                we screen the SFD data for anomalous signals on the flight line,                which we                refer to as SFD* *anomalies.                These SFD anomalies represent the re-distribution of material stresses                in                the subsurface. The signal anomalies are from either known oil and                natural                gas pools or unknown and non-producing areas. In the course of the                SFD                survey significant signal anomalies are confirmed on multiple flight                lines                forming the survey grid pattern. The cluster of confirmed SFD anomalies                form a "Prospect Area". |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | Then                our geological team puts each identified SFD "Prospect Areas” into                subsurface context using available geological databases. Where we                have                sufficiently qualified an SFD Prospect Area it is ready for further                geological and geophysical evaluation.                                                                                                                                                                                                                                                                                                                                                                                   |
| · | Lastly,                should the recommended SFD prospect be targeted for exploration,                traditional geological and geophysical methods, usually 2D or 3D                seismic,                are employed to evaluate the potential commercial viability of the                prospect and to pinpoint drilling sites.                                                                                                                                                                                                                                                                                                                                                                                    |

**SFD      Time Frames**

**Analysis      Of SFD Survey Results To Date**

----

**CONCLUSIONS**

----

**Joint      Ventures**

**BUSINESS      AND GEOGRAPHIC SEGMENTS**

**OPERATIONAL      RESULTS**

| l | In                February the 11-18-27-25w4 well operated by Centrica was placed on                production. The value to the company is net operating income of                approximately $4,000 per month;                                                                                                                                                                                                                              |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| l | In                February the Seneca Adsett well was abandoned by the operator as                non-commercial due to the significant volume of water being produced                in                conjunction with the natural gas;                                                                                                                                                                                                       |
| l | In                March we conducted the Syrian SFD Technology Evaluation                Survey;                                                                                                                                                                                                                                                                                                                                                |
| l | In                April we submitted the interpretation of the SFD Technology Evaluation                Survey to the Exploration Department of the Syrian Petroleum                Company;                                                                                                                                                                                                                                                    |
| l | In                July we received a report from the Syrian Petroleum Company evaluating                the                Prospect Areas identified in the SFD Technology Evaluation                Survey;                                                                                                                                                                                                                                    |
| l | In                July we retained Dr. Nimr Arab to complete a third party and independent                review of the SFD Technology Evaluation Survey conducted in                Syria;                                                                                                                                                                                                                                                     |
| l | In                August, we completed a series of agreements with our President, Mr.                George                Liszicasz defining NXT's ownership of the SFD sensors and providing                for a                long-term service agreement between Mr. Liszicasz and NXT. The service                agreement provides future support in the SFD sensor technology and                interpretation protocol development; |
| l | In                September we released the completed Dr. Nimr Arab report on the SFD                Technology Evaluation Survey conducted in Syria;                                                                                                                                                                                                                                                                                           |
| l | In                November we participated in the drilling and completion of a well                Virtus                Wildwood 16-2-55-9w5. The well costs qualified for Flow Through expenses                and completed our commitment to shareholders who had invested in                flow                through shares. The well completion operations carried forward into                February 2005;                          |
| l | In                December we completed a $1,000,000 financing with Dynamic Focus Resource                Fund of Toronto, ON, Canada;                                                                                                                                                                                                                                                                                                          |
| l | At                December 31, 2004 we had raised a total of $2,366,044 in a private                placement with the unit price of $2.00 and each unit consisting of                one                common share and one full common share purchase warrant with an exercise                price of $2.75;                                                                                                                                |
| l | In                December we appointed Ms. Jarmila Manasek as our Vice President of                Finance                and Controller;                                                                                                                                                                                                                                                                                                      |
| l | In                December the Board of Directors of NXT appointed Mr. Brian Kohlhammer,                CA,                as a member of the Board of Directors and of the Audit                Committee.                                                                                                                                                                                                                                     |

----

| · | In                February we actively commenced the business development activities                in the                Middle East                                                                                                                                                                                                                                                                      |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | In                March we sold all of our U.S. properties for $720,000 cash and the                return                to treasury of all of our outstanding preferred shares                                                                                                                                                                                                                           |
| · | Also                in March, a well at Dalroy, Alberta that we have a small interest                in was                completed and tested. Right of way delays persisted until 2004 and                the                well was tied in to the gathering system in early 2004.The                well at Carbon, Alberta commenced production and we have a 5% overriding                royalty. |
| · | In                May we conducted a 5,000 kilometer survey in B.C.                                                                                                                                                                                                                                                                                                                                        |
| · | In                June we sold our interest in the Monarch property                                                                                                                                                                                                                                                                                                                                        |
| · | In                August we acquired our Tenaka property in British Columbia,                Canada;                                                                                                                                                                                                                                                                                                       |
| · | In                September, we closed a private placement for $750,000 for which we                issued                1,875,000 common shares                                                                                                                                                                                                                                                          |
| · | Also,                in September our proposal to conduct an SFD technology evaluation                survey                in Syria was accepted by the Syrian Petroleum Company                                                                                                                                                                                                                          |
| · | In                October we continued NXT from Nevada to Alberta                                                                                                                                                                                                                                                                                                                                          |
| · | In                November, drilling commenced on our South Adsett prospect in                B.C.                                                                                                                                                                                                                                                                                                         |
| · | In                December we commenced two private placements and closed the 2003                flow-through placement segment                                                                                                                                                                                                                                                                           |
| · | In                December the South Adsett drilling was completed. It was tested in                February 2004 and abandoned.                                                                                                                                                                                                                                                                           |

**Summary      of Exploration Costs**

----

|                                                    |   | **Capitalized                      for the years ended December 31** |     | ** Capitalized                      as ofDecember 31** |   |
|---------------------------------------------------------|--------|----------------------------------------------------------------------|----------|-------------------------------------------------------------|--------|
|                                                    |   |  **2004**                                                       |     |  2003                                                  |   |  2004 |   |  2003 |   |  2002 |   |
|                                                    |   |                                                                 |     |                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
| Acquisition                      costs                  |   | $                                                                    | 122,825  |                                                        | $      | 386,349 |   | $ | 1,072,714 |   | $ | 949,889 |   | $ | 563,540 |   |
| Exploration                      costs                  |   |                                                                 | 269,113  |                                                        |   | 733,305 |   |   | 3,462,320 |   |   | 3,193,207 |   |   | 2,459,902 |   |
| Oil                      and natural gas properties     |   |                                                                 | 391,938  |                                                        |   | 1,119,654 |   |   | 4,535,034 |   |   | 4,143,096 |   |   | 3,023,442 |   |
| Less                      impairment and depletion      |   |                                                                 | (404,080 | )                                                           |   | (1,310,968 | ) |   | (3,089,814 | ) |   | (2,685,734 | ) |   | (1,374,766 | ) |
| Less                      dispositions                  |   |                                                                 | (20,673  | )                                                           |   | (104,701 | ) |   | (283,629 | ) |   | (262,956 | ) |   | (158,255 | ) |
| Less                      discontinued operations       |   |                                                                 | -        |                                                        |   | (1,273,498 | ) |   | - |   |   | - |   |   | 1,273,498 |   |
| Net                      oil and natural gas properties |   | $                                                                    | (32,815  | )                                                           | $      | (1,569,513 | ) | $ | 1,161,591 |   | $ | 1,194,406 |   | $ | 2,763,919 |   |

| The                      property costs net of depletion, impairments and dispositions,                      by proved                      and unproved classification, are as follows at                      December 31, 2004, 2003,                      2002: |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                       |   | **Capitalized                    As of** |          |
|--------------------------------------------|--------|------------------------------------------|---------------|
|                                       |   | **December                    31**       |          |
|                                       |   | **2004**                                 |          | 2003 |   | 2002 |   |
| Proved                    property costs   |   | **$**                                    | **35,543**    |   | $ | - |   | $ | 781,446 |   |
| Unproved                    property costs |   |                                     | **1,126,048** |   |   | 1,194,406 |   |   | 1,982,473 |   |
|                                       |   | **$**                                    | **1,161,591** |   | $ | 1,194,406 |   | $ | 2,763,919 |   |
|                                       |   |                                     |          |   |   |   |   |   |   |   |

**Summary        of Drilling Results**

|                                                                         |                                                     |                                                         | **Wells                    Shut-In Pending**  |                                                 | **Wells                    Abandoned Because** |
|------------------------------------------------------------------------------|----------------------------------------------------------|--------------------------------------------------------------|-----------------------------------------------|------------------------------------------------------|------------------------------------------------|
|                                                                         | **Total                    Wells Drilled in Period (1)** | **Wells                    Placed in Commercial Production** | **Connection                    to Pipeline** | **Further                    Development Decisions** |                                      | **Dry                    or NonCommercial** | **Junked                    for Mechanical Reasons** |
| **(Gross                    Wells/Net Wells)**                               |
|                                                                         |                                                     |                                                         |                                          |                                                 |                                           |   |   |
|                                                                         |                                                     |                                                         |                                          |                                                 |                                           |   |   |
|                                                                         |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| 2004:                                                                        |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| United                    States                                             | -                                                        | -                                                            | -                                             | -                                                    |                                           | - | - |
| Canada                                                                       | 1/0.20                                                   | 1/0.225                                                      | -                                             | 1/0.20                                               |                                           | - | - |
| Total                                                                        | 1/0.20                                                   | 1/0.225                                                      |                                          | 1/0.20                                               |                                           |   |   |
|                                                                         |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| 2003:                                                                        |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| United                    States                                             | -                                                        | -                                                            | -                                             | -                                                    |                                           | - | - |
| Canada                                                                       | 2/0.375                                                  | 1/0.225                                                      | 1/0.225                                       | 1/0.15                                               |                                           | - | - |
| Total                                                                        | 2/0.375                                                  | 1/0.225                                                      | 1/0.225                                       | 1/.015                                               |                                           | - | - |
|                                                                         |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| 2002:                                                                        |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| United                    States                                             | 1/0.17                                                   | -                                                            | -                                             | -                                                    |                                           | 1/0.17 | - |
| Canada                                                                       | 1/0.21                                                   | -                                                            | -                                             | -                                                    |                                           | 1/0.21 | - |
| Total                                                                        | 2/0.38                                                   | -                                                            | -                                             | -                                                    |                                           | 2/0.38 | - |
|                                                                         |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| Cumulative                    to date                                        | 32/5.025                                                 | 2/0.45                                                       | 13/1.925                                      | 7/1.09                                               |                                           | 9/1.41 | 1/0.15 |
|                                                                         |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| Notes:                                                                       |                                                     |                                                         |                                          |                                                 |                                           |   |   |
| 2004                    well placed in commercial production drilled in 2003 |                                                     |                                                         |                                          |                                                 |
| 2003                    well placed in commercial production drilled in 2001 |                                                     |                                                         |                                          |                                                 |

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**Summary        of Proved Reserves**

**Summary        of Acreage**

|                                              | **As                  of December 31, 2004** |
|---------------------------------------------------|----------------------------------------------|
|                                              | **Unproved**                                 |
| **Interest                  (geographical area)** | **Gross                  Acres**             | **Net                  Acres** |
| Alberta                                           | 21,760                                       | 8,328 |
| British                  Columbia                 | 13,045                                       | 3,626 |
| Total                                             | 34,805                                       | 11,954 |

**Description        Of Properties **

**Alberta,        Canada**

| · | ***Ardenode                  -***-We                  hold a 22.5% working interest in 640 acres. The producing well                  11-18-25-27w4 was drilled and completed in 2003 and tied into the                  production system in February 2004. The total net production from                  February                  to December 31, 2004 was 11 mmcf. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | ***Carbon                  —***We                  hold a 2.5% overall net overriding royalty interest in this 640                  acre exploration block located in the Carbon area of southwestern                  Alberta                  and receive a monthly royalty.                                                                          |
| · | ***Fincastle                  —***We                  hold 21% to 50 % interests in 1,280 acres in this prospect which                  targets                  Jurassic Sawtooth sands in the Taber area. In December 2002, a                  partner                  drilled and abandoned a well on this prospect.                                          |
| · | ***Wildwood                  —***We                  hold a 20% working interest in 640 acres. In December 2004, a partner                  drilled and suspended a well on this                  property.                                                                                                                                                       |

**British        Columbia, Canada**

| · | ***South                  Adsett—***This                  land was purchased in August 2002 and was drilled in late 2003.                  Although                  there were gas shows the well was abandoned in late February 2004.                  We hold                  a 26.7 % interest in 9,607 acres. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | ***Tenaka—***This                  land was purchased in August 2003 and we plan to run seismic on                  it in                  2004. We hold a 33% interest in 2,703                  acres.                                                                                                            |

**Future        **
**Activities**

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| · | Take                  the lead in applying SFD technology to larger, relatively unexplored                  basins, including regions outside of North America;                                                                                                                          |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | Continue                  marketing the SFD survey technology on a fee for service basis                  to the                  international oil and gas exploration industry including national                  oil                  companies in the Middle East and North Africa; |
| · | Upon                  identification of likely prospects, run gravity and 2D seismic                  to pinpoint                  drilling locations;                                                                                                                                   |
| · | Acquire                  mineral rights or negotiate participation rights; and                                                                                                                                                                                                           |
| · | Drill                  the selected sites, either directly or with interested joint venture                  partners.                                                                                                                                                                   |

| · | focus                  our exploration efforts on areas where SFD will be most                  effective;                                                                                                                                                                                                                                                             |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | expeditiously                  pursue seismic, land acquisition and drilling operations to prove                  prospects when we believe the circumstances to be warranted;                  and                                                                                                                                                                    |
| · | focus                  on exploration areas where we can acquire rights to all prospective                  zones                  as our SFD technology cannot determine the depth of subsurface                  reservoirs                  or other potential hydrocarbon-bearing features with a sufficient                  degree                  of accuracy. |

**Competition**

----

**Employees**

**Research        and Development**
** **

**Manufacturing        Capacity And Suppliers**
** **

**Subsidiaries**

**Governmental        And Environmental Regulation**

**SFD        Survey Flight Operations**

----

**Oil        and Gas Exploration and Development Projects**

**Operating        Hazards**

**SFD        Survey Flight Operations**

**Oil        and Gas Exploration and Development Projects**

----

**Sfd        Technology Agreement**
** **

| -   | Mr.                  Liszicasz is to be employed by NXT as its President and Chief Executive                  Officer. |
|---------------|------------------------------------------------------------------------------------------------------------------------|

| -   | In                  the course of his employment, Mr. Liszicasz is to provide the SFD                  with                  certain support services so that NXT can carry out its operations                  in the                  exploration for hydrocarbon                  resources. |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| -   | Mr.                  Liszicasz granted to NXT an exclusive, world-wide license to use,                  develop,                  copy and modify the existing sensors and to the extent necessary                  also the                  theories of quantum physics which are utilized in the operation                  of the                  sensors, and which theories remain the property of Mr.                  Liszicasz. |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Mr.                  Liszicasz shall be paid an annual salary that is set by NXT’s Compensation                  Committee. |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------|

| -   | Mr.                  Liszicasz shall be entitled to participate in NXT’s bonus plan or plans                  that may be provided from time to time by NXT. |
|---------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Mr.                  Liszicasz shall receive 10,000,000 shares of NXT’s preferred stock which                  may be converted into shares of NXT’s common stock on a one for one basis;                  conversion of the preferred shares in conditioned upon NXT reaching                  certain milestones: (a) the first 2,000,000 shares are immediately                  convertible; (b) the next 2,000,000 shares are convertible upon                  NXT                  reaching $50 million in annual gross revenues; (c) the next 2,000,000                  shares are convertible upon NXT reaching $100 million in annual                  gross                  revenues; (d) the next 2,000,000 shares are convertible upon NXT                  reaching                  $250 million in annual gross revenues; and (e) the final 2,000,000                  shares                  are convertible upon NXT reaching $500 million in annual gross                  revenues. |
|---------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Half                  of the 10,000,000 shares of NXT’s preferred stock to be issued to Mr.                  Liszicasz are subject to approval by NXT’s shareholders at NXT’s next                  annual meeting of shareholders. In the event that such approval                  is not                  given, 5,000,000 shares of the preferred stock shall be cancelled. |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We                  hold the exclusive worldwide right to use, possess and control                  all SFDs                  created as of August 1, 1996, as well as any enhancements and know-how                  relating thereto. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **·  ** | We                  are also entitled to the exclusive use of all SFD data generated                  by the                  SFDs for hydrocarbon identification and exploration purposes. |
|------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **·  ** | Momentum                  Resources is obligated to use its best efforts to survey with the                  SFD                  certain geographic areas throughout the world, which have been                  mutually                  selected by Momentum Resources, and us and to provide all raw SFD                  data                  resulting form such surveys to us for our exclusive use for the                  identification and exploitation of hydrocarbons. Momentum Resources                  further agreed to provide no less than 500 hours per year of trained                  manpower to generate the SFD data with respect to the selected                  areas.                  Despite this obligation, the Restated Technology Agreement does                  not set                  forth any provisions in the event that Momentum Resources fails                  to live up                  to these obligations. |
|------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The                  agreement provides for the Company to pay Momentum Resources a                  data fee                  equal to (i) 1% of the “Prospect Profits” actually received by us or                  our subsidiaries with respect to the commercial exploitation of                  each                  Prospect for which SFD data is provided by Momentum on or before                  December                  31, 2000; and (ii) 5% of any Prospect Profits actually received                  by us or                  our subsidiaries with respect to the commercial exploitation of                  each                  Prospect for which SFD data is provided by Momentum after                  December 31, 2000. As of                  the date of this annual report, we have not generated any Prospect                  Profits                  and thus have not paid any data fees to Momentum Resources. “Prospect                  Profits” generally means the aggregate of all gross revenues that we or                  our subsidiaries receive with respect to the commercial exploitation                  of                  all Prospects calculated, less all project expenses actually paid                  by us or                  our subsidiaries with respect to the commercial exploitation of                  all                  Prospects. “Prospects” generally means any identified search areas that                  have commercially extractable amounts of hydrocarbons as determined                  by the                  interpretation of the SFD data. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | In                  addition to the noted royalty the agreement provides for the Company                  to                  grant Momentum Resources "performance options" entitling it to                  purchase                  16,000 unregistered common shares for each month in which production                  from                  SFD prospects exceeds 20,000 barrels of hydrocarbons. The exercise                  price                  for these warrants will be the "fair market value" of our common                  shares as                  determined by the mean between the closing representative bid and                  asked                  price for our common shares on the last business day of the quarter                  of                  calculation as reported by NASDAQ or NASD or if the common shares                  are not                  traded on such date, on the next preceding trading day. The options                  automatically expire to the extent unexercised three years from                  the date                  of grant. We are not obligated, under any circumstances, to grant                  options                  which would entitle the holders to acquire more than 8% of our                  common                  shares, after taking into consideration outstanding unexercised                  options.                  The performance options are also non-transferable except to Momentum                  Resource's affiliates. As of the date of this annual report, no                  performance options have been earned by Momentum Resources. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Momentum                  Resources is prohibited during the term of the license from (i)                  engaging                  in the identification or exploitation of hydrocarbons for its own                  account                  or any party other than the Company; (ii) granting any license                  or                  sublicense to any third party to use SFDs or SFD data to any other                  party                  for any purpose; (iii) disclosing confidential and/or proprietary                  information relating to the SFD or SFD data to any other party;                  or (iv)                  selling, assigning or transferring its business, or license or                  sublicense                  the SFD or SFD data to any party. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We                  are prohibited during the term of the license from (i) identifying                  or                  exploiting deposits other than hydrocarbons which have been identified                  using the SFD; (ii) licensing or sublicensing or providing the                  SFD data or                  interpretations thereof to any party (other than our subsidiaries                  and                  joint venture partners); (iii) disclosing confidential and/or proprietary                  information relating to the SFD or SFD data to any other party;                  or (iv)                  selling, assigning or transferring our business, or rights to the                  SFD                  data. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The                  initial term of the Agreement expires on December 31, 2005 if                  either party provides the other with 60 days prior written notice                  of its                  election not to automatically renew the Agreement. NXT intends                  not to                  extend the agreement. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Momentum                  Resources, in turn, reserves the right to terminate the SFD technology                  Agreement upon the occurrence of any of the following events: |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | our                  failure to make any payment required under the Agreement; |
|--------------------|--------------------------------------------------------------------------------|

| ·   | our                  abandonment or discontinuance of the conduct of the oil and gas                  exploration business; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------|

| ·   | our                  dissolution or liquidation; |
|--------------------|--------------------------------------------------|

| ·   | our                  assignment of our assets for the benefit of our creditors, or our                  filing                  bankruptcy, or the appointment of a receiver for our business or                  property;                  or |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | our                  failure to perform any other material covenant, agreement or term                  of the                  Agreement. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------|

----

**Item        2. Properties**

**Facilities**

**Survey        Aircraft**

**Petroleum        Properties**

*Summary        of Exploration Costs*
*Description        of Properties*

**Item        3. Legal Proceedings**

----

**Item        4. Submission Of Matters To A Vote Of Security Holders**

| **Voting                  Results**  | **For**    | **Against** | **Abstain** |
|--------------------------------------|------------|-------------|-------------|
| Sheikh                  Al Hassan    | 13,464,016 | 0           | 6,608       |
| Donald                  Foulkes      | 13,465,516 | -0-         | 5,108       |
| Dennis                  R. Hunter    | 13,465,516 | -0-         | 5,108       |
| George                  Liszicasz    | 13,465,516 | 0           | 5,108       |
| Douglas                  Rowe        | 13,465,516 | -0-         | 5,108       |
| Robert                  Van Caneghan | 11,228,295 | -0-         | 13,050      |

| **Voting                  Results** | **For**    | **Against** | **Abstain** |
|-------------------------------------|------------|-------------|-------------|
|                                | 13,470,424 | 0           | 200         |

**PART        II**

**Item        5. Market Price Of And Dividends On Our Common Shares And Related**
**Shareholder        Matters**

**Market        Information**

* *

----

|                              |       | **Sales                    Price** |
|-----------------------------------|------------|------------------------------------|
| **Period**                        | **Volume** | **High**                           | **Low** |
| **2004:**                         |       |                               |   |
| First                    quarter  | 2,243,309  | $2.72                              | $1.10 |
| Second                    quarter | 1,716,245  | $2.68                              | $1.65 |
| Third                    quarter  | 675,745    | $2.55                              | $1.90 |
| Fourth                    quarter | 1,357,222  | $3.00                              | $1.35 |
|                              | 5,992,521  |                               |   |
| **2003:**                         |       |                               |   |
| First                    quarter  | 1,010,100  | $0.20                              | $0.09 |
| Second                    quarter | 2,624,000  | $0.55                              | $0.13 |
| Third                    quarter  | 5,198,500  | $1.04                              | $0.30 |
| Fourth                    quarter | 3,281,034  | $2.90                              | $0.70 |
|                              | 12,113,634 |                               |   |

**Dividend          Policy**

----

**Equity        Compensation Plans**

| **Plan                  Category**                                                                                                                                             | **Number                  of securities to be issued upon exercise of outstanding options,                  warrants                  and rights****(6)** | **Weighted                  average exercise price of outstanding options, warrants and                  rights** | **Number                  of securities remaining available for future issuance under equity                  compensation plans****(1)** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|
| Independent                  Option Grants (3)                                                                                                                                 | 15,000                                                                                                                                                    | $2.00                                                                                                             | 195,000                                                                                                                                   |
| 1997                  Employee Stock Option Plan (2)                                                                                                                           | 952,335                                                                                                                                                   | $1.54                                                                                                             | 47,145                                                                                                                                    |
| 1999                  Executive Stock Option Plan (3)                                                                                                                          | 180,000                                                                                                                                                   | $1.77                                                                                                             | 800,800                                                                                                                                   |
| 2000                  Director Stock Option Plan (4)                                                                                                                           | 375,000                                                                                                                                                   | $0.78                                                                                                             | 25,000                                                                                                                                    |
| 2003                  Stock Option Plan (5)                                                                                                                                    | 100,000                                                                                                                                                   | $0.82                                                                                                             | 20,000                                                                                                                                    |
| 2004                  Stock Option Plan(7)                                                                                                                                     | 70,000                                                                                                                                                    | $1.47                                                                                                             | 1,130,000                                                                                                                                 |
|                                                                                                                                                                           |                                                                                                                                                      |                                                                                                              |                                                                                                                                      |
| (1)                  Excluding securities reflected “Number of securities to be issued upon                  exercise of outstanding options, warrants and rights” |
| (2)                  Approved by security holders on July 25, 1997.                                                                                                            |                                                                                                                                                      |                                                                                                              |
| (3)                  Not approved by our shareholders.                                                                                                                         |                                                                                                                                                      |                                                                                                              |
| (4)                  Approved by security holders on September 20, 2002.                                                                                                       |                                                                                                                                                      |                                                                                                              |
| (5)                  Not approved by our shareholders                                                                                                                          |                                                                                                                                                      |                                                                                                              |
| (6)                  Outstanding as of December 31, 2004                                                                                                                       |                                                                                                                                                      |                                                                                                              |
| (7)                  Not approved by our shareholders.                                                                                                                         |                                                                                                                                                      |                                                                                                              |

*Independent        Option Grants*

----

*1999        Pinnacle Oil International, Inc. Executive Stock Option Plan*

----

**Item        6. Selected Consolidated Financial Information**

*Management's        Discussion and Analysis of Financial Condition and Results of        Operations*

----

|                                                                          |   | **Year                    Ended December 31** |           |
|-------------------------------------------------------------------------------|--------|-----------------------------------------------|----------------|
| **CONSOLIDATED                    STATEMENTS OF LOSS AND COMPREHENSIVE LOSS** |   |                                          |           |   |   |
|                                                                          |   | **2004**                                      |           | **2003** |   | **2002** |   | **2001** |   | **2000** |   |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |
| Revenues                                                                      |   |                                          |           |   |   |   |   |   |   |   |   |
| Oil                    and natural gas revenue                                |   | **$**                                         | **48,031**     |   | $ | - |   | $ | 75,628 |   | $ | - |   | $ | - |   |
| Gain                    on sale of properties                                 |   |                                          | **30,294**     |   |   | 12,003 |   |   | 42,046 |   |   | - |   |   | - |   |
|                                                                          |   |                                          | **78,325**     |   |   | **12,003** |   |   | **117,674** |   |   | **-** |   |   | **-** |   |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating                    expenses                                         |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Oil                    and natural gas operating expenses                     |   |                                          | **5,735**      |   |   | - |   |   | 1,559 |   |   | - |   |   | - |   |
| Administrative                                                                |   |                                          | **2,370,380**  |   |   | 1,782,952 |   |   | 1,442,477 |   |   | 1,435,367 |   |   | 1,368,841 |   |
| Depletion                    and impairment of oil and                        |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| natural                    gas properties                                     |   |                                          | **192,921**    |   |   | 1,004,973 |   |   | 210,871 |   |   | 915,528 |   |   | 93,625 |   |
| Amortization                    and depreciation                              |   |                                          | **57,930**     |   |   | 56,666 |   |   | 239,766 |   |   | 336,924 |   |   | 343,225 |   |
| Research                    and Development                                   |   |                                          | **-**          |   |   | - |   |   | 152,862 |   |   | 418,422 |   |   | 373,249 |   |
| Survey                    operations and support                              |   |                                          | **666,743**    |   |   | 130,499 |   |   | 48,909 |   |   | 140,531 |   |   | 106,083 |   |
|                                                                          |   |                                          | **3,293,709**  |   |   | 2,975,090 |   |   | 2,096,444 |   |   | 3,246,772 |   |   | 2,285,023 |   |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating                    loss from continuing operations                  |   |                                          | **(3,215,384** | **)** |   | (2,963,087 | ) |   | (1,978,770 | ) |   | (3,246,772 | ) |   | (2,285,023 | ) |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                    income                                               |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                                                                      |   |                                          | **(531**       | **)** |   | 2,190 |   |   | 26,499 |   |   | 80,113 |   |   | 348,213 |   |
| Other                                                                         |   |                                          | **-**          |   |   | (12,742 | ) |   | (1,636 | ) |   | (662 | ) |   | 17,520 |   |
|                                                                          |   |                                          | **(531**       | **)** |   | (10,552 | ) |   | 24,863 |   |   | 79,451 |   |   | 365,733 |   |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                    loss from continuing operations                        |   |                                          | **(3,215,915** | **)** |   | (2,973,639 | ) |   | (1,953,907 | ) |   | (3,167,321 | ) |   | (1,919,290 | ) |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income                    (loss) from discontinued                            |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| operations                                                                    |   |                                          | **33,494**     |   |   | 159,765 |   |   | (3,722,213 | ) |   | (1,221,269 | ) |   | (738,524 | ) |
| Net                    loss                                                   |   |                                          | **(3,182,421** | **)** |   | (2,813,874 | ) |   | (5,676,120 | ) |   | (4,388,590 | ) |   | (2,657,814 | ) |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                    comprehensive income (loss):                         |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Foreign                    currency translation adjustments                   |   |                                          | **(12,107**    | **)** |   | 461,515 |   |   | 39,211 |   |   | (158,952 | ) |   | (34,625 | ) |
| Comprehensive                    loss                                         |   | **$**                                         | **(3,194,528** | **)** | $ | (2,352,359 | ) | $ | (5,636,909 | ) | $ | (4,547,542 | ) | $ | (2,692,439 | ) |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                    and diluted net loss per share from                  |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| continuing                    operations                                      |   | **$**                                         | **(0.16**      | **)** | $ | (0.17 | ) | $ | (0.12 | ) | $ | (0.22 | ) | $ | (0.15 | ) |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                    and diluted net loss per share from                  |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| discontinued                    operations                                    |   | **$**                                         | **0.00**       |   | **$** | **0.01** |   | **$** | **(0.22** | **)** | **$** | **(0.09** | **)** | **$** | **(0.06** | **)** |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                    and diluted loss per share                           |   | **$**                                         | **(0.16**      | **)** | $ | (0.13 | ) | $ | (0.33 | ) | $ | (0.31 | ) | $ | (0.20 | ) |
|                                                                          |   |                                          |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted                    average common shares outstanding                 |   |                                          | **20,132,989** |   |   | 17,599,783 |   |   | 16,971,153 |   |   | 14,222,820 |   |   | 12,987,297 |   |

----

|                                                  |   | **As                  at December 31** |      |
|-------------------------------------------------------|--------|----------------------------------------|-----------|
| **CONSOLIDATED                  BALANCE SHEET DATA:** |   |                                   |      |   |   |   |   |   |   |
|                                                  |   | **2004**                               |      | **2003** |   | **2002** |   | **2001** |   | **2000** |   |
| Working                  Capital                      |   | $                                      | 688,128   |   | $ | 563,857 |   | $ | 842,530 |   | $ | 2,515,338 |   | $ | 4,045,536 |   |
| Current                  Assets                       |   | $                                      | 1,319,714 |   | $ | 1,250,908 |   | $ | 991,563 |   | $ | 3,342,224 |   | $ | 5,093,622 |   |
| Oil                  and natural gas properties, net  |   |                                   | 1,161,591 |   |   | 1,194,406 |   |   | 2,763,919 |   |   | 4,917,558 |   |   | 3,160,808 |   |
| Other                  property and equipment, net    |   |                                   | 176,651   |   |   | 190,810 |   |   | 229,131 |   |   | 3,448,416 |   |   | 3,854,206 |   |
| Total                  Assets                         |   | $                                      | 2,657,956 |   | $ | 2,636,124 |   | $ | 4,018,825 |   | $ | 11,763,100 |   | $ | 12,168,228 |   |
| Current                  Liabilities                  |   |                                   | 631,586   |   |   | 687,051 |   |   | 149,033 |   |   | 826,886 |   |   | 1,048,086 |   |
| Long-Term                  Liabilities                |   |                                   | 233,253   |   |   | - |   |   | - |   |   | 1,463,729 |   |   | 1,535,136 |   |
| Total                  Liabilities                    |   | $                                      | 864,839   |   | $ | 687,051 |   | $ | 149,033 |   | $ | 2,290,615 |   | $ | 2,583,222 |   |
| Shareholder's                  Equity                 |   | $                                      | 1,793,117 |   | $ | 1,949,073 |   | $ | 3,869,792 |   | $ | 9,472,485 |   | $ | 9,585,006 |   |

**Item        7. Management's Discussion And Analysis Of Financial Condition And Results        **

**Of        Operations**

**Overview**

**Results        Of Consolidated Operations**

**Operating        Revenues − 2004 compared to 2003**

| On                  February 4, 2004, a well at Entice, Alberta, in which we have a                  22.5%                  working interest, commenced production. Our share of production                  averaged                  33 thousand cubic feet (mcf) per day during the year ended December                  31,                  2004. Gross production revenue for the year was $51,453. The average                  price                  received was $4.62 per mcf and the operating cost was $0.57 per                  mcf.                   Total                  operating revenue including royalty income and net of royalty expense                  for                  2004 was $48,031. We had no production in                  2003. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Operating        Revenues − 2003 compared to 2002**

----

**Operating        Loss from Continuing Operations - 2004 compared to 2003**

| ·       | Administrative                    costs increased $587,428 (33%) in 2004 (total of $2,370,380)                    compared to                    2003 (total $1,782,952). This increase was caused by higher consulting                    fees in 2004 ($1,084,688 as opposed to $421,645 in 2003) in the                    areas of                    technical development, marketing, and preparation of business                    development                    plan and investor relations and by a 35% increase in audit                    fees. |
|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·  | Survey                    operations and support expenses increased by $536,244 (411%)                    and reached                    $666,743 in 2004 compared to $130,499 in 2003, due to the SFD                    Technology                    Evaluation Survey completed in 2004.                                                                                                                                                                                                                                                                  |
| ·  | Depletion                    and impairment decreased to $192,921 (80.8%) in 2004 from $1,004,973                    in                    2003 due to the fact that the bulk of our property was written                    off in 2004                    and no new property was purchased in                    2004.                                                                                                                                                                                                                                     |

**Operating        Loss from Continuing Operations - 2003 compared to 2002**

| · | a                  reduction of oil and natural gas revenues of $75,628 due to sale                  of the                  Canadian producing properties in July 2002;                                                                                                                                                                                       |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | an                  increase of $340,475 (24%) in administrative expenses due to costs                  associated with the corporate continuance, reduced allocations                  of expenses                  to research and increased costs associated with the efforts to                  establish a                  presence in the Middle East; |
| · | an                  increase of $794,102 (377%) in depletion and impairment expenses                  due to                  impairment of the Canadian properties; and                                                                                                                                                                                       |
| · | an                  increase of $81,590 (167%) in survey operations and support as                  we made                  several survey flights in 2003 and none in                  2002;                                                                                                                                                                 |

| · | a                  decrease in amortization and depreciation of $183,100 (76%) from                  $239,766                  in 2002 to $56,666 in 2003. This was due to the sale of the aircraft                  in                  2002; and                                                                                                      |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | a                  decrease of $152,862 in research and development from $152,862                  in 2002 to                  $nil in 2003. This reduction was due to resources being applied                  fully to                  application of the technology as well as reduced staff levels in                  this                  area. |

**Other        Income and Expense - 2004 compared to 2003**

| · | Interest                  income was offset by interest expense resulting in $531 net expense                  as                  compared to $2,190 interest income in 2003. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**Other        Income and Expense - 2003 compared to 2002**

| · | Interest                  income was down by $24,309 (92%) to $2,190 in 2003 from $26,499                  in 2002                  and this was caused                  by reduced cash balances in 2002.                                |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | Other                  income/expense: expense                  increased by $11,106 from $1,636 in 2002 to $12,742 in 2003 due                  to the                  reconciliation of realized intercompany                  losses. |

**Income        from Discontinued Operations - 2004 compared to 2003**

| · | The                  gain of $33,494 from discontinued operations in 2004 was derived                  from the                  exchange of previously written off airplane parts for flying time.                  The                  income of $159,765 in 2003 was a gain on disposal of US oil and                  gas                  properties. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Loss        from Discontinued Operations - 2003 compared to 2002**

| · | The                  loss of $3,722,213 from discontinued operations in 2002 decreased                  and                  became income of $159,765 in 2003. The main reasons are the production                  revenue received in early 2003 before the sale, a small gain on                  the sale                  of the U.S. properties and large property impairments in                  2002. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Relationships        and Transactions on Terms That Would Not Be Available From Clearly Independent        Third Parties**

**Liquidity        And Capital Resources**

**Sources        of Cash**

| (i)   | a                  loan from our CEO George Lizsicasz (the equivalent of $202,253,                  which was                  received on November 4 and $31,000 on November                  16); |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (ii)   | proceeds                  from the sale of shares: 728,269 common shares were sold at $2.00                  per                  share and 571,729 common shares were sold at $1.75 per share. The                  proceeds, net of issuance costs, were $1,366,221 and $999,823,                  respectively. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (iii)   | proceeds                  from options exercised for cash throughout the year: 218,621 options                  were                  exercised at share prices between $0.29 and $2.00 per share and                  yielded                  $218,527 in total; |
|-------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (iv)   | proceeds                  from sale of oil and natural gas properties in the amount of $31,653 |
|------------------|------------------------------------------------------------------------------------------------|

| (v)   | change                  in subscriptions payable in the amount of $33,956 |
|-----------------|---------------------------------------------------------------------------|

----

**Current        Cash Position and Historical Changes in Cash Position**

| · | $2,769,518                  cash used in operating activities;                                                                                                         |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | $2,783,866                  cash provided by financing activities;                                                                                                     |
| · | $550,000                  was converted into redeemable short-term investments and $173,580                  cash                  used in other investing activities; |
| · | $15,431                  cash used in discontinued operations                                                                                                          |
| · | $12,107                  comprehensive loss due to the effect of exchange rate                  changes.                                                               |

| · | $1,508,615                  cash used in operating activities;                                                   |
|--------|------------------------------------------------------------------------------------------------------------------|
| · | $1,498,268                  cash provided by financing activities;                                               |
| · | $736,368                  cash used in investing activities;                                                     |
| · | $724,331                  cash provided by discontinued operations; and                                          |
| · | a $461,515                  comprehensive gain due to the effect of exchange rate                  changes. |

**Operating        Activities **

| · | The $2,769,518                  in cash used in operating activities for 2004 reflected our net                  loss                  of $3,215,915 for that period, adjusted for non-cash deductions and                  a                  net decrease in non-cash working capital balances. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | The $1,508,615                  in cash used in operating activities for 2003 reflected our net                  loss                  of $2,973,639 for that period, adjusted for non-cash deductions and                  a                  net increase in non-cash working capital balances. |

----

**Financing        Activities **

| · | During                  2004 we raised $2,366,044 net through private placements and $218,527                  in                  cash was provided through the exercise of options. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | During                  2003 we raised $930,567 net through private placements and $95,200                  in cash                  was provided through the exercise of options.    |

**Investing        Activities **

| · | a                  sale of land at Scandia, eastern Alberta in 2004 generated $31,653                  in                  cash; the primary use of cash was for other property and equipment                  ($44,358) and oil and natural properties ($160,875). $550,000 was                  converted into redeemable short-term investments. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | In                  2003 there were small property sales, which generated $86,125 in                  cash and                  the primary use of cash was for other property and equipment ($41,330)                  and                  oil and natural properties                  ($808,879).                                                |

**Discontinued        Operations**

| · | Cash                  used in discontinued operations in 2004 was $15,431 paid for preparation                  of tax returns and filing fees.                                                  |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | Cash                  generated from discontinued operations in 2003 was $724,331, which                  was the                  proceeds on the sale of the U.S.                  properties. |

**Contractual        Obligations**

**Tabular        Disclosure of Contractual Obligations as at December 31,        2004**

|                                                                   | **Payments                    due by period** |
|------------------------------------------------------------------------|-----------------------------------------------|
| **Contractual                    Obligations As of December 31, 2004** | **Total                    ($)**              | **Less                    than 1 year** | **1-3                    years** |
| Loan                    from Officer/Shareholder                       | 233,253                                       | - | 233,253 |
| Pangaea                    Investments                                 | 4,160                                         | 4,160 | - |
| Rent                    or Operating Lease                             | 141,594                                       | 130,702 | 10,892 |
| Employment                    Agreements                               | 419,301                                       | 104,825 | 314,476 |

----

| · | An                  initial base salary of CDN $21,000 per month, with an automatic                  increase                  of 5% on each anniversary date. However, Mr. Liszicasz reduced                  his monthly                  salary to CDN $10,500. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | An                  annual bonus equal to 5% of our "net income after taxes" in the                  event we                  earn more than $5 million in net income after taxes in any                  year.                                                   |
| · | An                  annual performance bonus, as determined in the sole discretion                  of our                  board of directors.                                                                                                                    |

----

| Stage | Number                    of Preferred Shares | Annual                    Gross Revenue of the Company |
|-------|-----------------------------------------------|--------------------------------------------------------|
| 1     | 2,000,000                                     | N/A                    - convertible on signing        |
| 2     | 2,000,000                                     | $                    50,000,000                        |
| 3     | 2,000,000                                     | $100,000,000                                           |
| 4     | 2,000,000                                     | $250,000,000                                           |
| 5     | 2,000,000                                     | $500,000,000                                           |

**Off-Balance          Sheet Arrangements**

**Capital          Requirements Going Forward**

**Other          Matters**

**Foreign          Exchange**

----

**Effect          of Inflation**

**Critical          Accounting Policies**

| · | Capitalized                    costs under the full cost method of accounting are generally                    depleted and                    depreciated on a country-by-country cost center basis using the                    unit-of-production method, based on estimated proved oil and                    gas reserves                    as determined by independent engineers where significant. In                    addition,                    capital costs in each cost center are also restricted from exceeding                    the                    sum of the present value of the estimated discounted future net                    revenues                    of those properties, plus the cost or estimated fair value of                    unproved                    properties (the "*ceiling                    test*").                    Should this comparison indicate an excess carrying value, a write-down                    would be recorded. In making these accounting determinations,                    we rely in                    part upon a reserve report prepared by independent engineers                    specifically                    engaged for this purpose. To economically evaluate our proved                    oil and                    natural gas reserves, these independent engineers must necessarily                    make a                    number of assumptions, estimates and judgments that they believe                    to be                    reasonable based upon their expertise and professional and U.S.                    Securities                    and Exchange Commission guidelines. Were the independent engineers                    to use                    differing assumptions, estimates and judgments, then our consolidated                    financial condition and results of operations would be affected.                    For                    example, we would have lower revenues and net profits (or higher                    net                    losses) in the event the revised assumptions, estimates and judgments                    resulted in lower reserve estimates, since our depletion and                    depreciation                    rate would then be higher and it might also result in a write                    down under                    the ceiling test. Similarly, we would have higher revenues and                    net profits                    (or lower net losses) in the event the revised assumptions, estimates                    and                    judgments resulted in higher reserve estimates. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | Our                    management also periodically assesses the carrying values of                    unproved                    properties to ascertain whether any impairment in value has occurred.                    This                    assessment typically includes a determination of the anticipated                    future                    net cash flows based upon reserve potential and independent appraisal                    where warranted. Impairment is recorded if this assessment indicates                    the                    future potential net cash flows are less than the capitalized                    costs. Were                    our management to use differing assumptions, estimates and judgments,                    then                    our consolidated financial condition and results of operations                    would be                    affected. For example, we would have lower net profits (or higher                    net                    losses) in the event the revised assumptions, estimates and judgments                    resulted in increased impairment                    expense.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

**Recent          Accounting Pronouncements**

*Accounting          for Asset Retirement Obligations*

----

*“Accounting          for Stock-Based Compensation - Transition and Disclosure, an Amendment          of FASB          Statement No. 123”*

| ·   | Statement                    No. 149 - *Amendment                    for Statement 133 on Derivative Instruments and Hedging                    Activities*                    effective for contracts entered into or modified after June 30,                    2003 and                    for hedging relationships designated after June 30,                    2003. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Statement                    No. 150 - *Accounting                    for Certain Instruments with Characteristics of Both Liabilities                    and                    Equity*                    effective for financial instruments issued at the beginning of                    the first                    interim period beginning after June 15,                    2003. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Fin                    45 - *Guarantor’s                    Accounting and Disclosure Requirements for Guarantees, Including                    Indirect                    Guarantees of Indebtedness of Others*                    effective prospectively for guarantees issued or modified after                    December                    31, 2002 for initial recognition and initial measurement provisions;                    for                    financial statements of interim or annual periods ending after                    December                    15, 2002 for disclosure                    requirements. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Interpretation                    No. 46 - *Consolidation                    of Variable Interest Entities*,                    effective for financial statements issued after January 31,                    2003 |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Interpretation                    No. 46R Consolidation*of Variable Interest Entities*,                    an Interpretation of Accounting Research Bulletin No. 51, requires                    consolidation of entities in which the Corporation is the primary                    beneficiary, despite not having voting control, effective for                    financial                    statements issued after December 31,                    2003. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | SFAS                    146 - *Accounting                    for Costs Associated with Exit or Disposal Activities,*                    effective prospectively for such activities initiated after December                    31,                    2002. It requires companies to recognize costs associated with                    exit or                    disposal activities when they are incurred rather than at the                    date of a                    commitment to an exit or disposal plan.* * |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | In                    September 2004, the SEC released SAB 106, which expresses the                    staff’s                    views on the application of SFAS 143 by oil and gas producing                    companies                    following the full cost accounting method. SAB 106 provides interpretive                    responses related to computing the full cost ceiling to avoid                    double-counting the expected future cash outflows associated                    with asset                    retirement obligations, required disclosures relating to the                    interaction                    of SFAS 143 and the full cost rules, and the impact of SFAS 143                    on the                    calculation of depreciation, depletion, and amortization. This                    has no                    impact on our company at this time. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | In                    December 2004, the FASB issued SFAS No. 153, Exchanges of Non-monetary                    Assets, an amendment of APB Opinion No. 29 that amends Opinion                    29 to                    eliminate the exception from fair market measurement for nonmonetary                    exchanges of similar productive assets and replaces it with an                    exception                    for exchanges that do not have commercial substance. The provisions                    of                    this statement are effective for all nonmonetary exchanges occurring                    in                    fiscal years beginning after June 15, 2005. The adoption of this                    Statement                    is not expected to have material effect on the results of operations                    or                    financial position of the company. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Item          7a. Quantitative and Qualitative Disclosure About Market          Risk**

**Oil          And Gas Price Fluctuations**

**Currency          Fluctuations**

**Interest          Rate Fluctuations**

----

----

**ENERGY          EXPLORATION TECHNOLOGIES INC**
**.**

----

**CONSOLIDATED          FINANCIAL STATEMENTS**

**For          The Years Ended December 31, 2004, 2003 And 2002**

----

----

**Item          8. Financial Statements And Supplementary Data**

**TABLE          OF CONTENTS**

|                                                                                                                                                                                                     | **Page** |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------|
| **REPORTS                    OF INDEPENDENT REGISTERED CHARTERD ACCOUNTANTS**                                                                                                                            | 39       |
| **CONSOLIDATED                    FINANCIAL STATEMENTS**                                                                                                                                                 |     |
| Consolidated                    Balance Sheets                                                                                                                                                           | 41       |
| Consolidated                    Statements of Loss and Comprehensive Loss                                                                                                                                | 42       |
| Consolidated                    Statements of Shareholders’ Equity (Deficit                                                                                                                        | 43       |
| Consolidated                    Statements of Cash Flows                                                                                                                                                 | 44       |
| Notes                    to Consolidated Financial Statements                                                                                                                                            | 45       |
|                                                                                                                                                                                                     |     |
| **SUPPLEMENTAL                    INFORMATION ON OIL AND GAS ACTIVITIES (UNAUDITED)**                                                                                                                    |     |
| Table                    I - Total Costs Incurred In Oil And Natural Gas Acquisition,                    Exploration                    And Development                    Activities                    | 64       |
| Table                    II - Capitalized Costs Related To Oil And Natural Gas Producing                    Activities...............                                                    | 65       |
| Table                    III - Quantities Of Oil And Natural Gas Reserves                                                                                                                                | 65       |
| Table                    IV - Standardized Measure Of Discounted Future Net Cash Flows                    Related To                    Proved Oil                    And Natural Gas Reserve Quantities | 66       |
| **SUPPLEMENTAL                    INFORMATION - SELECTED QUARTERLY FINANCIAL DATA**                                                                                                                      | 68       |

----

***REPORT        OF INDEPENDENT REGISTERED CHARTERED ACCOUNTANTS***

|  Calgary, Canada |                                                                |
|-----------------------|---------------------------------------------------------------------|
|  April 6, 2005   |  Independent                  Registered Chartered Accountants |

----

**Comments        by Independent Registered Chartered Accountants on Canada-United States of        America Reporting Difference**

|  Calgary, Canada |                                                              |
|-----------------------|-------------------------------------------------------------------|
|  April 6, 2005   |  Independent                Registered Chartered Accountants |

----

| **ENERGY                  EXPLORATION TECHNOLOGIES INC.**                                               |   |
|---------------------------------------------------------------------------------------------------------|--------|
| **Consolidated                  Balance Sheets**                                                        |   |
| **(Expressed                  in U.S. dollars except share data)**                                 |   |
|                                                                                                    |   |   |   |   |   |
|                                                                                                    |   | **December                  31, 2004** |   | December                  31, 2003 |   |
| **Assets**                                                                                              |   |   |   |   |   |
| Current                  assets                                                                         |   |   |   |   |   |
| Cash                                                                                                    |   | **$** | **287,431** |   | $ | 1,024,201 |   |
| Short                  term investments                                                                 |   |   | **550,000** |   |   | - |   |
| Accounts                  receivable                                                                    |   |   | **387,943** |   |   | 76,133 |   |
| Due                  from officers and employees [note 14]                                              |   |   | **5,803** |   |   | **-** |   |
| Note                  receivable from former officer [note 3]                                           |   |   | **50,058** |   |   | 43,952 |   |
| Prepaid                  expenses                                                                       |   |   | **38,479** |   |   | 106,622 |   |
|                                                                                                         |   |   | **1,319,714** |   |   | 1,250,908 |   |
|                                                                                                    |   |   |   |   |   |   |   |
| Oil                  and natural gas properties, on the basis of full cost                  accounting, |   |   |   |   |   |   |   |
| net                  of depletion and impairments [note 4]                                         |   |   | **1,161,591** |   |   | 1,194,406 |   |
|                                                                                                    |   |   |   |   |   |   |   |
| Other                  property and equipment, net of accumulated depreciation,                         |   |   |   |   |   |   |   |
| amortization                  and impairment [note 5]                                              |   |   | **176,651** |   |   | 190,810 |   |
|                                                                                                    |   | **$** | **2,657,956** |   | $ | 2,636,124 |   |
|                                                                                                    |   |   |   |   |   |   |   |
| **Liabilities                  And Shareholders' Equity**                                               |   |   |   |   |   |   |   |
| Current                  liabilities                                                                    |   |   |   |   |   |   |   |
| Trade                  payables                                                                         |   | **$** | **102,562** |   | $ | 136,098 |   |
| Other                  accrued liabilities [note 6]                                                     |   |   | **90,479** |   |   | 78,452 |   |
| Subscriptions                  payable [note 8]                                                         |   |   | **438,545** |   |   | 472,501 |   |
|                                                                                                    |   |   | **631,586** |   |   | 687,051 |   |
|                                                                                                    |   |   |   |   |   |   |   |
| Long                  term liabilities:                                                                 |   |   |   |   |   |   |   |
| Note                  payable [note 7]                                                                  |   |   | **233,253** |   |   | - |   |
|                                                                                                    |   |   | **864,839** |   |   | 687,051 |   |
|                                                                                                    |   |   |   |   |   |   |   |
| Contingencies,                  continuing operations and commitments [notes 1 and 15]                  |   |   |   |   |   |   |   |
|                                                                                                    |   |   |   |   |   |   |   |
| Shareholders'                  equity                                                                   |   |   |   |   |   |   |   |
| Preferred                  shares [note 9]                                                              |   |   |   |   |   |   |   |
| Authorized:                  unlimited                                                                  |   |   |   |   |   |   |   |
| Issued                  : nil                                                                           |        |  | **-** |  |  | **-** |   |
| Common                  shares                                                                          |   |   |   |   |   |   |   |
| Authorized:                  unlimited                                                                  |   |   |   |   |   |   |   |
| Issued                  : 21,055,171 and 19,306,852 at December 31, 2004 and                            |   |   |   |   |   |   |   |
| December                  31, 2003, respectively [note 8                                                |        |  | **27,565,636** |  |  | 24,527,066 |   |
| Warrants                  [notes 8 and 10]                                                              |   |   | **-** |  |  | **-** |  |
| Accumulated                  deficit                                                                    |   |   | **(26,038,158** | **)** |   | (22,855,919 | ) |
| Accumulated                  other comprehensive income                                                 |        |  | **265,639** |   |   | 277,926 |   |
|                                                                                                    |   |   | **1,793,117** |   |   | 1,949,073 |   |
|                                                                                                    |   |   |   |   |   |   |   |
|                                                                                                    |   | **$** | **2,657,956** |   | $ | 2,636,124 |   |
| The                  accompanying notes to consolidated financial statements                            |
| are                  an integral part of these consolidated balance                  sheets             |

----

| **ENERGY                  EXPLORATION TECHNOLOGIES INC.**                                                           |   |
|---------------------------------------------------------------------------------------------------------------------|--------|
| **Consolidated                  Statements Of Loss And Comprehensive Loss**                                         |   |
| **(Expressed                  in U.S. dollars except share data)**                                             |   |
|                                                                                                                |   |   |   |   |   |   |   |
|                                                                                                                |   |   |   |   |   |   |   |
|                                                                                                                |   |   |   |   |   |   |   |
|                                                                                                                |   | **Twelve                  months ended** |   |
|                                                                                                                |   | **December                  31,** |   |
|                                                                                                                |   | **2004** |   | **2003** |   | **2002** |   |
|                                                                                                                |   |   |   |   |   |   |   |
| Revenues                                                                                                            |   |   |   |   |   |   |   |
| Oil                  and natural gas revenue                                                                        |   | **$** | **48,031** |   | $ | - |   | $ | 75,628 |   |
| Gain                  on sale of properties                                                                         |   |   | **30,294** |   |   | 12,003 |   |   | 42,046 |   |
|                                                                                                                |   |   | **78,325** |   |   | **12,003** |   |   | **117,674** |   |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Operating                  expenses                                                                                 |   |   |   |   |   |   |   |   |   |   |
| Oil                  and natural gas operating expenses                                                             |   |   | **5,735** |   |   | - |   |   | 1,559 |   |
| Administrative                                                                                                      |   |   | **2,370,380** |   |   | 1,782,952 |   |   | 1,442,477 |   |
| Depletion                  and impairment of oil and                                                                |   |   |   |   |   |   |   |   |   |   |
| natural                  gas properties [note 4]                                                               |   |   | **192,921** |   |   | 1,004,973 |   |   | 210,871 |   |
| Amortization                  and depreciation [notes 5]                                                            |   |   | **57,930** |   |   | 56,666 |   |   | 239,766 |   |
| Research                  and development                                                                           |   |   | **-** |   |   | - |   |   | 152,862 |   |
| Survey                  operations and support                                                                      |   |   | **666,743** |   |   | 130,499 |   |   | 48,909 |   |
|                                                                                                                |   |   | **3,293,709** |   |   | 2,975,090 |   |   | 2,096,444 |   |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Operating                  loss from continuing operations                                                          |   |   | **(3,215,384** | **)** |   | (2,963,087 | ) |   | (1,978,770 | ) |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Other                  income                                                                                       |   |   |   |   |   |   |   |   |   |   |
| Interest                                                                                                            |   |   | **(531** | **)** |   | 2,190 |   |   | 26,499 |   |
| Other                                                                                                               |   |   | **-** |   |   | (12,742 | ) |   | (1,636 | ) |
|                                                                                                                |   |   | **(531** | **)** |   | (10,552 | ) |   | 24,863 |   |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Net                  loss from continuing operations                                                                |   |   | **(3,215,915** | **)** |   | (2,973,639 | ) |   | (1,953,907 | ) |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Income                  (loss) from discontinued                                                                    |   |   |   |   |   |   |   |   |   |   |
| operations                  [note 16]                                                                               |   |   | **33,494** |   |   | 159,765 |   |   | (3,722,213 | ) |
| Net                  loss                                                                                           |   |   | **(3,182,421** | **)** |   | (2,813,874 | ) |   | (5,676,120 | ) |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Other                  comprehensive income (loss):                                                                 |   |   |   |   |   |   |   |   |   |   |
| Foreign                  currency translation adjustments                                                           |   |   | **(12,107** | **)** |   | 461,515 |   |   | 39,211 |   |
| Comprehensive                  loss                                                                                 |   | **$** | **(3,194,528** | **)** | $ | (2,352,359 | ) | $ | (5,636,909 | ) |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Basic                  and diluted net loss per share from                                                          |   |   |   |   |   |   |   |   |   |   |
| continuing                  operations [note 8]                                                                     |   | **$** | **(0.16** | **)** | $ | (0.17 | ) | $ | (0.12 | ) |
| Basic                  and diluted net loss per share from                                                          |   |   |   |   |   |   |   |   |   |   |
| discontinued                  operations [note 8]                                                                   |   | **$** | **0.00** |   | $ | 0.01 |   | $ | (0.22 | ) |
| Basic                  and diluted loss per share [note 8]                                                     |   | **$** | **(0.16** | **)** | $ | (0.13 | ) | $ | (0.33 | ) |
|                                                                                                                |   |   |   |   |   |   |   |   |   |   |
| Weighted                  average common shares outstanding                                                         |   |   | **20,132,989** |   |   | 17,599,783 |   |   | 16,971,153 |   |
| The                  accompanying notes to consolidated financial statements                  are                   |   |   |   |
| an                  integral part of these consolidated statements of loss and comprehensive                  loss. |   |   |   |

----

| **ENERGY                  EXPLORATION TECHNOLOGIES INC.**                                                                              |   |
|----------------------------------------------------------------------------------------------------------------------------------------|--------|
| **Consolidated                  Statements Of Shareholders' Equity (Deficit)**                                                         |   |
| **(Expressed                  in U.S. dollars except share data)**                                                                |   |
|                                                                                                                                   |   | **Accumulated                  Other** |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                   |   | **Comprehensive** |   | **Common                  Shares** |   |   |   | **Preferred                  Shares** |   |   |   | **Warrants** |   |   |   | **Accumulated                  Deficit** |   |   |   |
|                                                                                                                                   |   | **Income                  (loss)** |   | **Shares** |   | **Amount** |   | **Shares** |   | **Amount** |   | **Number** |   | **Amount** |   |   |   | **Total** |   |
| Balance-December                  31, 2001                                                                                             |   | $ | (222,800 | ) |   | 16,971,153 |   | $ | 23,331,210 |   |   | 800,000 |   | $ | 730,000 |   |   | - |   | $ | - |   | $ | (14,365,925 | ) | $ | 9,472,485 |   |
| **2002:**                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Grant                  and vesting of options to investor relations consultant                                                         |   |   | - |   |   | - |   |   | 34,216 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 34,216 |   |
| Loss                  from continuing operations                                                                                       |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (1,953,907 | ) |   | (1,953,907 | ) |
| Loss                  from discontinued operations                                                                                     |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (3,722,213 | ) |   | (3,722,213 | ) |
| Other                  comprehensive loss                                                                                              |   |   | 39,211 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 39,211 |   |
| Balance-December                  31, 2002                                                                                             |   | $ | (183,589 | ) |   | 16,971,153 |   | $ | 23,365,426 |   |   | 800,000 |   | $ | 730,000 |   |   | - |   | $ | - |   | $ | (20,042,045 | ) | $ | 3,869,792 |   |
| **2003:**                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Grant                  and vesting of options to investor relations consultant                                                         |   |   | - |   |   | - |   |   | 46,773 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 46,773 |   |
| Issued                  for cash at $0.40 per share on                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| September                  19, 2003 net of issuance costs                                                                              |   |   |   |   |   | 1,999,000 |   |   | 744,050 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 744,050 |   |
| Redemption                  of preferred shares                                                                                        |   |   | - |   |   | - |   |   | - |   |   | (800,000 | ) |   | (730,000 | ) |   | - |   |   | - |   |   | - |   |   | (730,000 | ) |
| Compensation                  expense related to issuance                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| of                    options to employees and directors                                                                               |   |   | - |   |   | - |   |   | 89,100 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 89,100 |   |
| Options                  exercised forcash at prices between $0.21 and $2.00 per                  share                                |   |   | - |   |   | 234,999 |   |   | 95,200 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 95,200 |   |
| Flow-Through                  shares issued for cash at $2.00 per share                                                                |   |   | - |   |   | 101,700 |   |   | 186,517 |   |   | - |   |   | - |   |   | 7,496 |   |   | - |   |   | - |   |   | 186,517 |   |
| Loss                  from continuing operations                                                                                       |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (2,973,639 | ) |   | (2,973,639 | ) |
| Income                  from discontinued operations                                                                                   |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 159,765 |   |   | 159,765 |   |
| Other                  comprehensive income                                                                                            |   |   | 461,515 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 461,515 |   |
| Balance                  — December 31, 2003                                                                                     |   | $ | 277,926 |   |   | 19,306,852 |   | $ | 24,527,066 |   |   | - |   | $ | - |   |   | 7,496 |   | $ | - |   | $ | (22,855,919 | ) | $ | 1,949,073 |   |
| **2004:**                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Options                  exercised for cash at prices between $0.29 amd $2.00 per                  share                               |   |   | - |   |   | 218,621 |   |   | 218,527 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 218,527 |   |
| Issued                  for cash at $2.00 per share on                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| February                  12, 2004 net of issuance costs                                                                     |   |   | - |   |   | 573,269 |   |   | 1,063,277 |   |   | - |   |   | - |   |   | 604,331 |   |   | - |   |   | - |   |   | 1,063,277 |   |
| Issued                  for services at $1.80 per share on April 18, 2004                                                              |   |   | - |   |   | 30,000 |   |   | 54,000 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 54,000 |   |
| Issued                  for services at $2.00 per share on July 22, 2004                                                               |   |   | - |   |   | 200,000 |   |   | 400,000 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 400,000 |   |
| Issued                  for cash at $2.00 per share on                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| July                  22, 2004 net of issuance costs                                                                                   |   |   | - |   |   | 55,000 |   |   | 109,853 |   |   | - |   |   | - |   |   | 60,680 |   |   | - |   |   | - |   |   | 109,853 |   |
| Issued                  for cash at $2.00 per share on                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sept                  10, 2004 net of issuance costs                                                                         |   |   | - |   |   | 78,000 |   |   | 145,765 |   |   | - |   |   | - |   |   | 44,960 |   |   | - |   |   | - |   |   | 145,765 |   |
| Issued                  for cash at $1.75 per share on                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December                  2, 2004 net of issuance costs                                                                                |   |   | - |   |   | 571,429 |   |   | 999,823 |   |   | - |   |   | - |   |   | 610,000 |   |   | - |   |   | - |   |   | 999,823 |   |
| Issued                  for cash at $2.00 per share on                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December                  31, 2004 net of issuance costs                                                                               |   |   | - |   |   | 22,000 |   |   | 47,326 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 47,326 |   |
| Loss                  from continuing operations                                                                                       |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (3,215,915 | ) |   | (3,215,915 | ) |
| Loss                  from discontinued operations                                                                                     |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 33,494 |   |   | 33,494 |   |
| Other                  comprehensive loss                                                                                              |   |   | (12,107 | ) |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (12,107 | ) |
| Balance                  — December 31, 2004                                                                                     |   | **$** | **265,819** |   |   | **21,055,171** |   | **$** | **27,565,636** |   |   | **-** |   | **$** | **-** |   |   | **1,327,467** |   | **$** | **-** |   | **$** | **(26,038,158** | **)** | **$** | **1,793,297** |   |
| The                  accompanying notes to consolidated financial statements                  are                                      |
| an                  integral part of these consolidated statements of shareholders'                  equity                  (deficit) |

----

| **ENERGY                  EXPLORATION TECHNOLOGIES INC.**                                                     |   |
|---------------------------------------------------------------------------------------------------------------|--------|
| **Consolidated                  Statements Of Cash flow**                                                     |   |
| **(Expressed                  in U.S. dollars)**                                                         |   |
|                                                                                                          |   |   |   |   |   |   |   |
|                                                                                                          |   |   |   |   |   |   |   |
|                                                                                                          |   | **Twelve                  months ended** |
|                                                                                                          |   | **December                  31,** |
|                                                                                                          |   | **2004** |   | **2003** |   | **2002** |   |
| **Operating                  activities**                                                                     |   |   |   |   |   |   |   |
| Net                  loss from continuing operations                                                          |   | **$** | **(3,215,915** | **)** | $ | (2,973,639 | ) | $ | (1,953,907 | ) |
| Amortization                  and depreciation of other property                                              |   |   |   |   |   |   |   |   |   |   |
| and                  equipment                                                                                |   |   | **57,930** |   |   | 56,666 |   |   | 239,766 |   |
| Depletion                  and impairment of oil and natural gas properties                                   |   |   | **192,921** |   |   | 1,004,973 |   |   | 210,871 |   |
| Consulting                  costs settled by issuance of common stock                                         |   |   |   |   |   |   |   |   |   |   |
| and                  options                                                                                  |   |   | **454,000** |   |   | 46,773 |   |   | 34,216 |   |
| Gain                  on sale of oil and natural gas properties                                               |   |   | **(30,294** | **)** |   | (12,003 | ) |   | (42,046 | ) |
| Changes                  in non-cash working capital                                                          |   |   |   |   |   |   |   |   |   |   |
| Accounts                  receivable                                                                |   |   | **(262,885** | **)** |   | 252,041 |   |   | (124,436 | ) |
| Interest                  accrued on loan to former employee                                        |   |   | **(6,106** | **)** |   | (9,740 | ) |   | (2,115 | ) |
| Due                  from officers and employees                                                    |   |   | **(5,803** | **)** |   | 5,004 |   |   | (4,912 | ) |
| Prepaid                  expenses                                                                   |   |   | **68,143** |   |   | (33,307 | ) |   | 70,471 |   |
| Trade                  payables                                                                     |   |   | **(33,536** | **)** |   | 61,805 |   |   | (436,721 | ) |
| Other                  accrued liabilities                                                          |   |   | **12,027** |   |   | 3,712 |   |   | (58,896 | ) |
| Compensation                  settled with options                                                            |   |   | **-** |   |   | 89,100 |   |   | - |   |
| Interest                  costs settled by issuance of common stock                                           |   |   | **-** |   |   | - |   |   | - |   |
| Net                  cash used by operating activities                                                        |   |   | **(2,769,518** | **)** |   | (1,508,615 | ) |   | (2,067,709 | ) |
| **Financing                  activities**                                                                     |   |   |   |   |   |   |   |   |   |   |
| Note                  payable                                                                                 |   |   | **233,253** |   |   | - |   |   | - |   |
| Funds                  raised through the sale of common shares,                                              |   |   |   |   |   |   |   |   |   |   |
| net                  of issuance costs                                                                   |   |   | **2,366,042** |   |   | 930,567 |   |   | - |   |
| Funds                  raised through the sale of preferred stock and warrants                                |   |   |   |   |   |   |   |   |   |   |
| ,                  net of costs                                                                          |   |   | **-** |   |   | - |   |   | - |   |
| Funds                  raised through the exercise of options                                                 |   |   | **218,527** |   |   | 95,200 |   |   | **-** |   |
| Funds                  raised through the exercise of warrants                                                |   |   | **-** |   |   | - |   |   | **-** |   |
| Subscriptions                  payable                                                                        |   |   | **(33,956** | **)** |   | 472,501 |   |   | **-** |   |
| Net                  cash generated by financing activities                                                   |   |   | **2,783,866** |   |   | 1,498,268 |   |   | - |   |
| **Investing                  activities**                                                                     |   |   |   |   |   |   |   |   |   |   |
| Funds                  invested in other property and equipment                                               |   |   | **(44,358** | **)** |   | (41,330 | ) |   | - |   |
| Proceeds                  on sale of other property and equipment                                             |   |   | **-** |   |   | 27,716 |   |   | 3,900 |   |
| Funds                  invested in oil and natural gas properties                                             |   |   | **(160,875** | **)** |   | (808,879 | ) |   | (463,107 | ) |
| Funds                  borrowed by an employee                                                                |   |   | **-** |   |   | - |   |   | - |   |
| Proceeds                  on sale of oil and natural gas properties                                           |   |   | **31,653** |   |   | 86,125 |   |   | 199,326 |   |
| Funds                  invested in short term investments                                                     |   |   | **(550,000** | **)** |   | - |   |   | - |   |
| Changes                  in non-cash working capital;                                                         |   |   |   |   |   |   |   |   |   |   |
| Accrued                  oil and natural gas property costs and trade payables                                |   |   | - |   |   | - |   |   | (110,829 | ) |
| Net                  cash used by investing activities                                                        |   |   | **(723,580** | **)** |   | (736,368 | ) |   | (370,710 | ) |
| **Net                  cash generated (used) by discontinued operations**                                     |   |   | **(15,431** | **)** |   | 724,331 |   |   | (10,330 | ) |
| **Effect                  of net other comprehensive income (loss)**                                          |   |   | **(12,107** | **)** |   | 461,515 |   |   | 39,211 |   |
| **Net                  cash inflow (outflow)**                                                                |   |   | **(736,770** | **)** |   | 439,131 |   |   | (2,409,538 | ) |
| **Cash                  and Cash Equivalents, beginning of period**                                           |   |   | **1,024,201** |   |   | 585,070 |   |   | 2,994,608 |   |
|                                                                                                          |   |   |   |   |   |   |   |   |   |   |
| **Cash                  and Cash Equivalents, end of period**                                                 |   | **$** | **287,431** |   | $ | 1,024,201 |   | $ | 585,070 |   |
|                                                                                                          |   |   |   |   |   |   |   |   |   |   |
| Non                  cash discontinued operations                                                             |   |   |   |   |   |   |   |   |   |   |
| Aircraft                  parts sold for credit with airplane                                       |   |   |   |   |   |   |   |   |   |   |
| leasing                  company                                                                         |   | **$** | **48,925** |   | $ | - |   | $ | - |   |
| Cash                  paid for taxes                                                                     |   | **$** | **-** |   | $ | - |   | $ | - |   |
| Cash                  paid for interest                                                                  |   | **$** | **-** |   | $ | - |   | $ | - |   |
| The                  accompanying notes to consolidated financial statements are an                  integral |
| part                  of these consolidated statements of cash                  flows                         |

----

**1.        Organization and Ability to Continue Operations**

*we*
*,        *
*our        company*
*NXT*

*SFD*

----

**2.        Significant Accounting Policies**

***Basis        of Presentation***

***Consolidation***

***Estimates        and Assumptions***

***Cash        and Cash Equivalents***

***Short        Term Investments***

***Debt        Issuance Costs***

***Fair        Value of Financial Instruments***

----

**Oil        and Natural Gas Properties**

| Ÿ | land                  acquisition costs;                                                                                                                    |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Ÿ | geological                  and geophysical costs;                                                                                                          |
| Ÿ | costs                  of drilling both productive and non-productive wells;                                                                                |
| Ÿ | cost                  of production equipment and related facilities; and                                                                                   |
| Ÿ | various                  costs associated with evaluating petroleum and natural gas properties                  for                  potential acquisition. |

----

***Other        Property and Equipment***

| Computer                  and SFD system equipment | 30%  |
|----------------------------------------------------|------|
| Computer                  and SFD system software  | 100% |
| Equipment                                          | 20%  |
| Furniture                  and fixtures            | 20%  |
| Flight                  equipment                  | 10%  |
| Leasehold                  improvements            | 20%  |
| Tools                                              | 20%  |
| Vehicle                                            | 30%  |

***Revenue        Recognition***

***Research        and Development Expenditures***

**Survey        Operations and Support**

| Ÿ | conduct                  field evaluations to evaluate the SFD survey system;                                                                                        |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Ÿ | develop,                  organize, staff and train our survey and interpretation operational                  functions;                                            |
| Ÿ | aircraft                  operating costs, travel expenses and allocable salaries of our                  personnel                  while on survey assignment; and |
| Ÿ | allocable                  salaries of our personnel while interpreting SFD                  data.                                                                   |

----

**Foreign        Currency Translation**

| Ÿ | all                  asset and liability accounts are translated into U.S. dollars at the                  rate of exchange in effect as of the end of the applicable fiscal                  period; |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Ÿ | all                  shareholders' equity accounts are translated into U.S. dollars using                  historical exchange rates; and                                                             |
| Ÿ | all                  revenue and expense accounts are translated into U.S. dollars at the                  average rate of exchange for the applicable fiscal                  period.                |

***Income        Taxes***

**Stock-Based        Compensation for Employees and Directors**

*,        *
*Accounting        for Stock Issued to Employees*
*APB*
*5*

*Accounting        for Stock-Based Compensation*

|                                                                                      |   | 2004 | 2003 | 2002 |
|-------------------------------------------------------------------------------------------|--------|------|------|------|
| Weighted-Average                    Fair Value of Options Granted in Each Year ($/option) |   | 1.18 | 1.45 | 1.69 |
| Expected                    Dividends paid per common share ($/share)                     |   | Nil  | Nil  | Nil  |
| Expected                    life (years)                                                  |   | 3    | 4.5  | 4.5  |
| Expected                    volatility in the price of NXT’s common shares (%)      |   | 235  | 207  | 225  |
| Risk                    free interest rate (%)                                            |   | 4    | 4    | 4    |

----

|                                                                                                                                                               |   | **Twelve                  Months Ended** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|
|                                                                                                                                                               |   | **December                  31,**        |
|                                                                                                                                                               |   | **2004**                                 |   | 2003 |   | 2002 |   |
| Net                  loss as reported                                                                                                                              |   | **$**                                    | **(3,182,421** | **)** | $ | (2,813,874 | ) | $ | (5,676,120 | ) |
| Add:                  Stock-based employee compensation expense, included in reported                  net                  loss                                   |   |                                     | **-** |   |   | 89,100 |   |   | - |   |
| Deduct:                  Total stock-based employee compensation expense determined under                  fair                  value based method for all awards |   |                                     | **(241,722** | **)** |   | (306,509 | ) |   | (738,176 | ) |
| Pro                  forma net loss for the year                                                                                                                   |   | **$**                                    | **(3,424,143** | **)** | $ | (3,031,283 | ) | $ | (6,414,296 | ) |
|                                                                                                                                                               |   |                                     |   |   |   |   |   |   |   |   |
| Pro                  forma basic and diluted loss per common share                                                                                                 |   | $                                        | (0.17 | ) | $ | (0.17 | ) | $ | (0.37 | ) |

***Recent        Accounting Pronouncements***

*Accounting        for Asset Retirement Obligations*

*“Accounting        for Stock-Based Compensation - Transition and Disclosure, an Amendment of        FASB        Statement No. 123” *

----

| ·   | Statement                  No. 149 - *Amendment                  for Statement 133 on Derivative Instruments and Hedging                  Activities*                  effective for contracts entered into or modified after June 30,                  2003 and                  for hedging relationships designated after June 30,                  2003. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Statement                  No. 150 - *Accounting                  for Certain Instruments with Characteristics of Both Liabilities                  and                  Equity*                  effective for financial instruments issued at the beginning of                  the first                  interim period beginning after June 15,                  2003. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Interpretation                  No. 45 - *Guarantor’s                  Accounting and Disclosure Requirements for Guarantees, Including                  Indirect                  Guarantees of Indebtedness of Others*                  effective prospectively for guarantees issued or modified after                  December                  31, 2002 for initial recognition and initial measurement provisions;                  for                  financial statements of interim or annual periods ending after                  December                  15, 2002 for disclosure                  requirements. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Interpretation                  No. 46 - *Consolidation                  of Variable Interest Entities*,                  effective for financial statements issued after January 31,                  2003 |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Interpretation                  No. 46R - Consolidation*of Variable Interest Entities*,                  an Interpretation of Accounting Research Bulletin No. 51, requires                  consolidation of entities in which the Corporation is the primary                  beneficiary, despite not having voting control, effective for financial                  statements issued after December 31,                  2003. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | SFAS                  146 - *Accounting                  for Costs Associated with Exit or Disposal Activities,*                  effective prospectively for such activities initiated after December                  31,                  2002. It requires companies to recognize costs associated with                  exit or                  disposal activities when they are incurred rather than at the date                  of a                  commitment to an exit or disposal plan.* * |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | In                  September 2004, the SEC released SAB 106, which expresses the staff’s                  views on the application of SFAS 143 by oil and gas producing companies                  following the full cost accounting method. SAB 106 provides interpretive                  responses related to computing the full cost ceiling to avoid                  double-counting the expected future cash outflows associated with                  asset                  retirement obligations, required disclosures relating to the interaction                  of SFAS 143 and the full cost rules, and the impact of SFAS 143                  on the                  calculation of depreciation, depletion, and amortization. This                  has no                  impact on our company at this time. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | In                  December 2004, the FASB issued SFAS No. 153, Exchanges of Non-monetary                  Assets, an amendment of APB Opinion No. 29 that amends Opinion                  29 to                  eliminate the exception from fair market measurement for nonmonetary                  exchanges of similar productive assets and replaces it with an                  exception                  for exchanges that do not have commercial substance. The provisions                  of                  this statement are effective for all nonmonetary exchanges occurring                  in                  fiscal years beginning after June 15, 2005. The adoption of this                  Statement                  is not expected to have material effect on the results of operations                  or                  financial position of the company. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**3.        Note Receivable from Former Officer**

----

**4.        Oil and Natural Gas Properties**

|                                                  |   | **Capitalized                    for the years** |     | **Capitalized                    as of** |   |
|-------------------------------------------------------|--------|--------------------------------------------------|----------|------------------------------------------|--------|
|                                                  |   | **ended                    December 31**         |     | **December                    31**       |   |
|                                                  |   | **2004**                                         |     | **2003**                                 |   | **2004** |   | **2003** |   | **2002** |   |
|                                                  |   |                                             |     |                                     |   |   |   |   |   |   |   |
| Acquisition                    costs                  |   | $                                                | 122,825  |                                     | $      | 386,349 |   | $ | 1,072,714 |   | $ | 949,889 |   | $ | 563,540 |   |
| Exploration                    costs                  |   |                                             | 269,113  |                                     |   | 733,305 |   |   | 3,462,320 |   |   | 3,193,207 |   |   | 2,459,902 |   |
| Oil                    and natural gas properties     |   |                                             | 391,938  |                                     |   | 1,119,654 |   |   | 4,535,034 |   |   | 4,143,096 |   |   | 3,023,442 |   |
| Less                    impairment and depletion      |   |                                             | (404,080 | )                                        |   | (1,310,968 | ) |   | (3,089,814 | ) |   | (2,685,734 | ) |   | (1,374,766 | ) |
| Less                    dispositions                  |   |                                             | (20,673  | )                                        |   | (104,701 | ) |   | (283,629 | ) |   | (262,956 | ) |   | (158,255 | ) |
| Less                    discontinued operations       |   |                                             | -        |                                     |   | (1,273,498 | ) |   | - |   |   | - |   |   | 1,273,498 |   |
| Net                    oil and natural gas properties |   | $                                                | (32,815  | )                                        | $      | (1,569,513 | ) | $ | 1,161,591 |   | $ | 1,194,406 |   | $ | 2,763,919 |   |

| The                  property costs net of depletion, impairments and dispositions,                  by proved                  and unproved classification, are as follows at                  December 31, 2004, 2003,                  2002: |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                        |   | **Capitalized                as of December 31** |          |
|----------------------------------------|--------|--------------------------------------------------|---------------|
|                                   |   | **2004**                                         |          | 2003 |   | 2002 |   |
| Proved                property costs   |   | **$**                                            | **35,543**    |   | $ | - |   | $ | 781,446 |   |
| Unproved                property costs |   |                                             | **1,126,048** |   |   | 1,194,406 |   |   | 1,982,473 |   |
|                                   |   | **$**                                            | **1,161,591** |   | $ | 1,194,406 |   | $ | 2,763,919 |   |

|                                       |   | **Capitalized                    for the Years ended December 31** |    |  **Capitalized                    as of December 31,** |   |
|--------------------------------------------|--------|--------------------------------------------------------------------|---------|-------------------------------------------------------------|--------|
|                                       |   | **2004**                                                           |    | 2003                                                        |   | **2004** |   | 2003 |   | 2002 |   |
|                                       |   |                                                               |    |                                                        |   |   |   |   |   |   |   |
| South                    Adsett            |   | $                                                                  | 19,863  |                                                        | $      | 57,146 |   | $ | 272,913 |   | $ | 253,050 |   | $ | 195,904 |   |
| Tenaka                                     |   |                                                               | 21,777  |                                                        |   | 277,000 |   |   | 298,777 |   |   | 277,000 |   |   | - |   |
| Entice                                     |   |                                                               | (51,771 | )                                                           |   | 51,771 |   |   | - |   |   | 51,771 |   |   | - |   |
| Drumheller                                 |   |                                                               | (3,840  | )                                                           |   | (45,030 | ) |   | 53,760 |   |   | 57,600 |   |   | 102,630 |   |
| Scandia                                    |   |                                                               | (37,980 | )                                                           |   | (29,692 | ) |   | - |   |   | 37,980 |   |   | 67,672 |   |
| Medicine                    Hat            |   |                                                               | (9,600  | )                                                           |   | (112,576 | ) |   | 134,400 |   |   | 144,000 |   |   | 256,576 |   |
| Suffield                                   |   |                                                               | (3,024  | )                                                           |   | (35,461 | ) |   | 42,336 |   |   | 45,360 |   |   | 80,821 |   |
| Other                    miscellaneous     |   |                                                               | (3,783  | )                                                           |   | (272,027 | ) |   | 323,862 |   |   | 327,645 |   |   | 599,672 |   |
| Discontinued                    operations |   |                                                               | -       |                                                        |   | (679,198 | ) |   | - |   |   | - |   |   | 679,198 |   |
| Unproved                    properties     |   | $                                                                  | (68,358 | )                                                           | $      | (788,067 | ) | $ | 1,126,048 |   | $ | 1,194,406 |   | $ | 1,982,473 |   |

----

**5.          Other Property and Equipment**

|                                                                          |   |                               |           |                               |   |
|-------------------------------------------------------------------------------|--------|------------------------------------|----------------|------------------------------------|--------|
|                                                                          |   | **December                    31** |           | **December                    31** |   |
|                                                                          |   | **2004**                           |           | **2003**                           |   |
|                                                                          |   |                               |           |                               |   |
| Computer                    and SFD equipment                                 |   | **$**                              | **359,809**    |                               | $      | 332,011 |   |
| Computer                    and SFD software                                  |   |                               | **155,223**    |                               |   | 142,238 |   |
| Equipment                                                                     |   |                               | **89,302**     |                               |   | 86,046 |   |
| Furniture                    and fixtures                                     |   |                               | **222,602**    |                               |   | 187,588 |   |
| Leasehold                    improvements                                     |   |                               | **257,224**    |                               |   | 238,475 |   |
| SFD                    survey system (including software)                     |   |                               | **136,425**    |                               |   | 127,845 |   |
| Tools                                                                         |   |                               | **2,046**      |                               |   | 1,897 |   |
| Vehicle                                                                       |   |                               | **18,828**     |                               |   | 18,828 |   |
| Flight                    Equipment                                           |   |                               | **1,489**      |                               |   | 1,380 |   |
| Other                    property and equipment                               |   |                               | **1,242,948**  |                               |   | 1,136,308 |   |
| Less                    accumulated depreciation, amortization and impairment |   |                               | **(1,066,296** | **)**                              |   | (945,498 | ) |
| Net                    other property and equipment                           |   | **$**                              | **176,651**    |                               | $      | 190,810 |   |

----

**6.        Other accrued Liabilities**

**7.        Notes Payable**

**8.        Common Stock**

----

**9.        Preferred Shares**

**10.        Performance Warrants**

*Momentum        Resources*

**11.        Employee and Director Options**

***Description        of Plans***

*Plans*

| Ÿ | separate                    stand-alone directors' options which we granted to selected directors                    as                    compensation for serving on our board of directors; as these                    grants were                    not a part of an option plan there is no underlying maximum number                    of                    shares reserved and no general vesting and expiry conditions                    specified;                                                                                                                                                                                                                                                                                                                                 |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Ÿ | the 1997                    Pinnacle Oil International, Inc. Stock Plan (the "*1997                    Plan*"),                    pursuant to which 1,500,000 common shares are reserved for issuance                    to employees, directors and consultants in the form of stock                    options or                    outright stock grants; unless otherwise specified in the Option                    Certificate, all options vest on the date of grant and the maximum                    expiry                    date is 10 years from the date of the grant; subject to this                    maximum                    expiry date, the Administrator may determine different expiry                    and vesting                    conditions; |
| Ÿ | the 1999                    Pinnacle Oil International, Inc. Executive Option Plan (the "*1999                    Plan*"),                    pursuant to which 1,000,000                    common shares are reserved for issuance to executive officers                    in the form                    of stock options; unless otherwise specified in the Option Certificate,                    all options vest on the date of grant and the maximum expiry                    date is 10                    years from the date of the grant; subject to this maximum expiry                    date, the                    Administrator may determine different expiry and vesting                    conditions;                                               |

----

| Ÿ | the 2000                    Pinnacle Oil International, Inc. Directors' Option Plan (the "*2000                    Plan*"),                    pursuant to which 400,000 common shares are reserved for issuance to                    selected directors in the form of stock options; unless otherwise                    specified in the Option Certificate, all options vest on the                    date of grant                    and the maximum expiry date is 10 years from the date of the                    grant;                    subject to this maximum expiry date, the Administrator may determine                    different expiry and vesting conditions;  |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Ÿ | the                    2003 Stock Plan under which 375,000 common shares are reserved                    for                    issuance to consultants; and the Plan Administrator has the authority                    to                    decide the vesting conditions and the expiration dates of options                    awarded                    under this plan;                                                                                                                                                                                                                                                                                                                              |
| Ÿ | the                    2004 Stock Option Plan under which 1.2 million common shares                    are reserved                    for issuance to eligible employees, directors, members of management                    and                    service providers; the                    maximum option period is 10 years from the grant and vesting                    conditions                    are determined bythe                    Board of Directors and the Compensation                    Committee.                                                                                                                                                                                  |

----

***Summary        of Option Grants***

|                                                  |   | **2004**    |          | 2003         |   | 2002  |   |
|-------------------------------------------------------|--------|-------------|---------------|--------------|--------|------------|--------|
|                                                  |   | **Common**  |          | **Weighted** |   | Common     |   | Weighted |   | Common |   | Weighted |   |
|                                                  |   | **Shares**  |          | **Average**  |   | Shares     |   | Average |   | Shares |   | Average |   |
|                                                  |   | **Under**   |          | **Exercise** |   | Under      |   | Exercise |   | Under |   | Exercise |   |
|                                                  |   | **Options** |          | **Price**    |   | Options    |   | Price |   | Options |   | Price |   |
| Outstanding                    at beginning of year   |   |        | **2,008,942** |         | **$**  | **1.45**   |   |   | 1,501,842 |   | $ | 2.02 |   |   | 2,174,900 |   | $ | 2.25 |   |
| Granted                                               |   |        | **648,000**   |         |   | **1.90**   |   |   | 790,000 |   |   | 0.35 |   |   | 344,000 |   |   | 0.36 |   |
| Exercised                                             |   |        | **(218,621**  | **)**        |   | **(1.18**  | **)**  |   | (234,999 | ) |   | (0.41 | ) |   | - |   |   | - |   |
| Forfeited                                             |   |        | **(33,334**   | **)**        |   | **(0.09**  | **)**  |   | (36,334 | ) |   | (1.40 | ) |   | (230,000 | ) |   | (0.48 | ) |
| Expired                                               |   |        | **(712,652**  | **)**        |   | **(1.93**  | **)**  |   | (11,567 | ) |   | (0.45 | ) |   | (787,058 | ) |   | (1.62 | ) |
|                                                  |   |        |               |         |   |            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding                    at end of year         |   |        | **1,692,335** |         | **$**  | **1.40**   |   |   | 2,008,942 |   | $ | 1.45 |   |   | 1,501,842 |   | $ | 2.02 |   |
| Exercisable                    at end of year         |   |        | **653,663**   |         | **$**  | **1.83**   |   |   | 1,309,270 |   | $ | 1.84 |   |   | 1,063,842 |   | $ | 2.02 |   |
| Available                    for grant at end of year |   |        | **2,217,945** |         |   |       |   |   | 1,149,959 |   |   |   |   |   | 438,000 |   |   |   |   |

----

|                                                |                              |                                  |            | **As                    of December 31, 2004**  |
|-----------------------------------------------------|-----------------------------------|---------------------------------------|-----------------|------------------------------------------------------|
| **Stock                    Option Plan**            | **Grant                    Date** | **Exercise                    Price** | **Outstanding** | **Vested                    and Exercisable**        |
|                                                |                              |                                  |            |                                                 |   |
| Independent                    Grants               |                              |                                  |            |                                                 |
|                                                |                              | January                    4, 2001    | $2.00           | 15,000                                               | 15,000 |
|                                                |                              |                                  |            |                                                 |   |
| 1997                    Employee Stock Option Plan  |                              |                                  |            |                                                 |
|                                                |                              | December                    27, 2000  | $4.13           | 10,000                                               | 8,000 |
|                                                |                              | January                    4, 2001    | $2.00           | 170,000                                              | 164,000 |
|                                                |                              | May                    15, 2001       | $2.50           | 120,000                                              | 120,000 |
|                                                |                              | July                    5, 2001       | $2.00           | 25,000                                               | 15,000 |
|                                                |                              | August                    13, 2002    | $0.38           | 40,001                                               | 6,666 |
|                                                |                              | September                    20, 2002 | $0.29           | 2,667                                                | - |
|                                                |                              | March                    27, 2003     | $0.14           | 60,000                                               | 20,000 |
|                                                |                              | September                    8, 2003  | $0.43           | 191,667                                              | 45,000 |
|                                                |                              | August                    12, 2004    | $2.15           | 210,000                                              | - |
|                                                |                              | December                    23, 2004  | $1.47           | 123,000                                              | - |
|                                                |                              |                                  |            |                                                 |   |
| 1999                    Executive Stock Option Plan |                              |                                  |            |                                                 |
|                                                |                              | August                    12, 2004    | $2.15           | 80,000                                               | - |
|                                                |                              | December                    23, 2004  | $1.47           | 100,000                                              | - |
|                                                |                              |                                  |            |                                                 |   |
| 2000                    Directors Stock Option Plan |                              |                                  |            |                                                 |
|                                                |                              | February                    15, 2000  | $2.00           | 15,000                                               | 15,000 |
|                                                |                              | April                    17, 2000     | $2.00           | 30,000                                               | 30,000 |
|                                                |                              | August                    13, 2002    | $0.38           | 120,000                                              | 79,999 |
|                                                |                              | September                    20, 2002 | $0.29           | 10,000                                               | 6,666 |
|                                                |                              | September                    8, 2003  | $0.43           | 160,000                                              | 53,332 |
|                                                |                              | August                    12, 2004    | $2.15           | 40,000                                               | - |
|                                                |                              |                                  |            |                                                 |   |
| 2003                    Plan                        |                              |                                  |            |                                                 |   |
|                                                |                              | August                    12, 2004    | $2.15           | 25,000                                               | -                      |
|                                                |                              | June                    24, 2003      | $0.38           | 75,000                                               | 75,000 |
|                                                |                              |                                  |            |                                                 |   |
| 2004                    Stock Option Plan           |                              |                                  |            |                                                 |
|                                                |                              | December                    23, 2004  | $2.15           | 70,000                                               | - |
|                                                |                              |                                  |            | 1,692,335                                            | 653,663 |

----

| **Contractual                  Life for Outstanding Options** |
|---------------------------------------------------------------|
|                                                          | **2005** | **2006** | **2007** | **2008** | **2009** | **2010** | **2011** |
| $0.14                                                         | - | - |   | 60,000 | - | - | - |
| $0.29                                                         | - | - | 12,667 | - | - | - | - |
| $0.38                                                         | - | - | 235,001 | - | - | - | - |
| $0.43                                                         | - | - | - | 351,667 | - | - | - |
| $1.47                                                         | - | - | - | - | 293,000 | - | - |
| $2.00                                                         | 55,000 | 61,000 | 46,000 | 46,000 | 31,000 | 11,000 | 5,000 |
| $2.15                                                         | - | - | - | - | 355,000 | - | - |
| $2.50                                                         | - | 50,000 | 35,000 | 35,000 | - | - | - |
| $4.13                                                         | - | 2,000 | 2,000 | 2,000 | 2,000 | 2,000 | - |
|                                                          | **55,000** | **113,000** | **330,668** | **494,667** | **681,000** | **13,000** | **5,000** |

***Compensation        Expense Associated With Grant of Options***

**12.**
**Investor        Relations Options**

|   |   | On                  May 15, 2002, as additional compensation to our investor relations                  consultant pursuant to an investor and public relations services                  agreement, we granted that consultant options to purchase 155,000                  common                  shares at $2.50 per share. The underlying agreement provided that                  50,000                  options would vest immediately, and an additional 35,000 options                  would                  vest upon each of the first, second and third anniversary dates                  of the                  agreement, respectively, even if the agreement was not subsequently                  renewed so long as the agreement has not been terminated for "*good                  cause"*                  as defined in the agreement. These options lapse, to the extent                  vested and                  unexercised, five years after the date of vesting. Pursuant to                  SFAS 123,                  for the year ended December 31, 2003, we recorded compensation                  expense, as                  part of administrative expense, determined in accordance with the                  Black                  Scholes options pricing model in the amount of $46,773 in connection                  with                  the grant and vesting of these                  options. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**13.        Income Taxes**

***Net        Operating Losses Carried Forward***

----

| **Country**                        |   | **Amount**                       |   | **Expiration                  Dates** |
|------------------------------------|--------|----------------------------------|--------|---------------------------------------|
| **United                  States** |   | **$                  5,861,634** |   | **2010—2024**                   |
| **Canada**                         |   | **$                  7,035,447** |   | **2005—2011**                   |

***Deferred        Income Tax Assets and Liabilities***

| **United                  States**                  |   |  **Amount**                 |   | **Statutory****Tax                  Rate** |   | **Tax****Benefit**         |
|-----------------------------------------------------|--------|----------------------------------|--------|--------------------------------------------|--------|----------------------------|
| Tax                  benefit of loss carry forwards |   | **$                  5,861,634** |   | **34%**                                    |   | **1,992,955**              |
| Tax                  asset related to depreciation  |   | **Nil**                          |   | **34%**                                    |   | **0**                      |
| Valuation                  reserve                  |   |                             |   |                                       |   | **(1,992,955)**            |
|                                                |   |                             |   |                                       |   | **$                  Nil** |
|                                                |   |                             |   |                                       |   |                       |
| **Canada**                                          |   |  **Amount**                 |   | **Statutory****Tax                  Rate** |   | **Tax****Benefit**         |
| Tax                  benefit of loss carry forwards |   | **7,035,447**                    |   | **39.25%**                                 |   | **$2,761,061**             |
| Tax                  asset related to depreciation  |   | **4,924,642**                    |   | **39.25%**                                 |   | **1,932,676**              |
| Valuation                  reserve                  |   |                             |   |                                       |   | **(4,693,737)**            |
|                                                |   |                             |   |                                       |   | **$                  Nil** |

| **United                  States**                  |   |  **Amount**                 |   | **Statutory****Tax                  Rate** |   | **Tax****Benefit**               |
|-----------------------------------------------------|--------|----------------------------------|--------|--------------------------------------------|--------|----------------------------------|
| Tax                  benefit of loss carry forwards |   | **$                  ( 48,718)** |   | **34%**                                    |   | **$                  (16,564)**  |
| Tax                  asset related to depreciation  |   | **$                  9,273,221** |   | **34%**                                    |   | **3,152,895**                    |
| Valuation                  reserve                  |   |                             |   |                                       |   | **(3,136,331)**                  |
|                                                |   |                             |   |                                       |   | **$                  Nil**       |
|                                                |   |                             |   |                                       |   |                             |
| **Canada**                                          |   |  **Amount**                 |   | **Statutory****Tax                  Rate** |   | **Tax****Benefit**               |
| Tax                  benefit of loss carry forwards |   | **$                  4,361,265** |   | **39.25%**                                 |   | **$                  1,711,578** |
| Tax                  asset related to depreciation  |   | **$                  3,650,053** |   | **39.25%**                                 |   | **1,432,463**                    |
| Valuation                  reserve                  |   |                             |   |                                       |   | **(3,144,041)**                  |
|                                                |   |                             |   |                                       |   | **$                  Nil**       |

**14.        Related Party Transactions**

----

| **December 31**                                                                                                                                       | **2004**                   | 2003     | 2002                     |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------|----------|--------------------------|
|                                                                                                                                                       |                       |     |                     |
| Collective                legal fees expensed to law firms with partners who were also directors                of                NXT or NXT Energy Canada | **Nil**                    | Nil      | $                72,440  |
|                                                                                                                                                       |                       |     |                     |
| Collective                wages, fees and benefits paid to executive officers of NXT, who were                also                directors of NXT         | **$116,373**               | $107,382 | $                234,958 |
|                                                                                                                                                       |                       |     |                     |
| Accounts                receivable due from executive officers                                                                                             | **$                5,803** | Nil      | $                5,004   |

**15.        Commitments and Contingencies**

----

**16.        Discontinued Operations**

----

**17.        Segment Information**

| Ÿ | revenues                  we have received during the year from continuing operations allocated                  amongst the geographic areas in which the revenue was                  generated;                                      |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Ÿ | our                  net loss for the year from continuing operations allocated amongst                  the                  geographic areas in which the revenue and associated expenses were                  generated.            |
| Ÿ | our                  net income (loss) for the year from discontinued operations allocated                  amongst the geographic areas in which the revenue and associated                  expenses                  were generated. |

|                                                                                                                                                    |   |                                 |                                 |       |   |           |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------|--------------------------------------|------------|--------|----------------|--------|
|                                                                                                                                                    |   | **United                    States** |                                 | **Canada** |   | **Total**      |   |
| **Twelve                    Months Ended**                                                                                                              |   |                                 |                                 |       |   |           |   |
|                                                                                                                                                    |   |                                 |                                 |       |   |           |   |
| **December                    31, 2004:**                                                                                                               |   |                                 |                                 |       |   |           |   |
| Revenues                    from oil and natural gas production                                                                                         |   | $                                    | -                                    |       | **$**  | **48,031**     |   | **$** | **48,031** |   |
| Net                    loss from continuing operations                                                                                                  |   | $                                    | -                                    |       | **$**  | **(3,215,915** | **)**  | **$** | **(3,215,915** | **)** |
| Income                    from discontinued operations                                                                                                  |   | **$**                                | **33,494**                           |       | $      | -              |   | **$** | **33,494** |   |
|                                                                                                                                                    |   |                                 |                                 |       |   |           |   |   |   |   |
| December                    31, 2003:                                                                                                                   |   |                                 |                                 |       |   |           |   |   |   |   |
| Revenues                    from oil and natural gas production                                                                                         |   | $                                    | -                                    |       | $      | -              |   | $ | - |   |
| Net                    loss from continuing operations                                                                                                  |   |                                 |                                 |       | $      | (2,973,639     | )      | $ | (2,973,639 | ) |
| Income                    from discontinued operations                                                                                                  |   | $                                    | 159,765                              |       | $      | -              |   | $ | 159,765 |   |
|                                                                                                                                                    |   |                                 |                                 |       |   |           |   |   |   |   |
| December                    31, 2002:                                                                                                                   |   |                                 |                                 |       |   |           |   |   |   |   |
| Revenues                    from oil and natural gas production                                                                                         |   | $                                    | -                                    |       | $      | 75,628         |   | $ | 75,628 |   |
| Net                    loss from continuing operations                                                                                                  |   | $                                    | -                                    |       | $      | (1,953,907     | )      | $ | (1,953,907 | ) |
| Income                    from discontinued operations                                                                                                  |   | $                                    | (3,722,213                           | )          | $      | -              |   | $ | (3,722,213 | ) |
|                                                                                                                                                    |   |                                 |                                 |       |   |           |   |   |   |   |
| Summarized                    below is geographic information relating to our assets as of                    December                    31, 2004 |   |                                 |                                 |       |   |           |   |   |   |   |
| and                    December 31, 2003, allocated amongst the geographic areas in                    which the assets                       |   |                                 |                                 |       |   |           |   |   |   |   |
| were                    physically located or principally connected:                                                                                    |   |                                 |                                 |       |   |           |   |   |   |   |
|                                                                                                                                                    |   |                                 |                                 |       |   |           |   |   |   |   |
|                                                                                                                                                    |   |                                 |                                 |       |   |           |   |   |   |   |
| **Assets                    As Of**                                                                                                                     |   |                                 | **United                    States** |       |   | **Canada**     |   |   | **Total** |   |
| **December                    31, 2004:**                                                                                                               |   | **$**                                | **-**                                |       | **$**  | **2,657,956**  |   | **$** | **2,657,956** |   |
| December                    31, 2003                                                                                                                    |   | $                                    | -                                    |       | $      | 2,636,124      |   | $ | 2,636,124 |   |

----

**18.        Subsequent Events**

**19.        Comparative Figures**

----

**SUPPLEMENTAL        INFORMATION ON OIL AND NATURAL GAS PRODUCING ACTIVITIES        (UNAUDITED)**

*Disclosures        About Oil and Gas Producing Activities*

**Table        I **

**Total        Costs Incurred In Oil and Natural Gas Acquisition, Exploration and Development        Activities**

| **Years                    Ended**        |   | **United                    States** |      | **Canada** |   | **Total**   |   |
|-------------------------------------------|--------|--------------------------------------|-----------|------------|--------|-------------|--------|
| **December                    31, 2004:** |   |                                 |      |       |   |        |   |
| **Acquisition                    costs**  |   | **$**                                | **-**     |       | **$**  | **161,465** |   | **$** | **161,465** |   |
| **Exploration                    costs**  |   |                                 | **-**     |       |   | **-**       |   |   | **-** |   |
| **Development                    costs**  |   |                                 | **-**     |       |   | **-**       |   |   | **-** |   |
|                                      |   | **$**                                | **-**     |       | **$**  | **161,465** |   | **$** | **161,465** |   |
|                                      |   |                                 |      |       |   |        |   |   |   |   |
| December                    31, 2003:     |   |                                 |      |       |   |        |   |   |   |   |
| Acquisition                    costs      |   | $                                    | 1,665     |       | $      | 388,014     |   | $ | 389,679 |   |
| Exploration                    costs      |   |                                 | 67,982    |       |   | 797,944     |   |   | 865,926 |   |
| Development                    costs      |   |                                 | -         |       |   | -           |   |   | - |   |
|                                      |   | $                                    | 69,647    |       | $      | 1,185,958   |   | $ | 1,255,605 |   |
|                                      |   |                                 |      |       |   |        |   |   |   |   |
| December                    31, 2002:     |   |                                 |      |       |   |        |   |   |   |   |
| Acquisition                    costs      |   | $                                    | 8,260     |       | $      | 223,966     |   | $ | 232,226 |   |
| Exploration                    costs      |   |                                 | 1,169,339 |       |   | 211,462     |   |   | 1,380,801 |   |
| Development                    costs      |   |                                 | -         |       |   | 27,681      |   |   | 27,681 |   |
|                                      |   | $                                    | 1,177,599 |       | $      | 463,109     |   | $ | 1,640,708 |   |

----

**Table        II **

**Capitalized        Costs Related To Oil and Natural Gas Producing        Activities**

|                                                    |   | **United                  States** |       | **Canada** |   | **Total**      |   |
|---------------------------------------------------------|--------|------------------------------------|------------|------------|--------|----------------|--------|
|                                                    |   |                               |       |       |   |           |   |
| **As                  At December 31, 2004:** |   |                               |       |       |   |           |   |
| Proved                  property costs                  |   | **$**                              | **Nil**    |       | **$**  | **55,841**     |   | **$** | **55,841** |   |
| Less                  dispositions                      |   |                               | **-**      |       |   | **-**          |   |   | **-** |   |
| Less                  impairment                        |   |                               | **-**      |       |   | **-**          |   |   | **-** |   |
| Less                  depletion                         |   |                               | **-**      |       |   | **(20,298**    | **)**  |   | **(20,298** | **)** |
| Net                  proved property costs              |   |                               | **-**      |       | **$**  | **35,543**     |   | **$** | **35,543** |   |
| Unproved                  property costs                |   |                               | **-**      |       |   | **3,537,895**  |   |   | **3,537,895** |   |
| Less                  impairment                        |   |                               | **-**      |       |   | **(2,411,847** | **)**  |   | **(2,411,847** | **)** |
| Net                  unproved property costs            |   |                               | **-**      |       |   | **1,126,048**  |   |   | **1,126,048** |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |
|                                                    |   | **$**                              | -     |       | **$**  | **1,161,591**  |   | **$** | **1,161,591** |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |
| As                  At December 31, 2003:     |   |                               |       |       |   |           |   |   |   |   |
| Proved                  property costs                  |   | $                                  | Nil        |       | $      | Nil            |   | $ | Nil |   |
| Less                  dispositions                      |   |                               | -          |       |   | -              |   |   | - |   |
| Less                  impairment                        |   |                               | -          |       |   | -              |   |   | - |   |
| Less                  depletion                         |   |                               | -          |       |   | -              |   |   | - |   |
| Net                  proved property costs              |   |                               | -          |       |   | **-**          |   |   | - |   |
| Unproved                  property costs                |   |                               | -          |       |   | 3,404,471      |   |   | 3,404,471 |   |
| Less                  impairment                        |   |                               | -          |       |   | (2,210,065     | )      |   | (2,210,065 | ) |
| Net                  unproved property costs            |   |                               | -          |       |   | 1,194,406      |   |   | 1,194,406 |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |
|                                                    |   | **$**                              | -     |       | $      | 1,194,406      |   | $ | 1,194,406 |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |
| As                  At December 31, 2002:     |   |                               |       |       |   |           |   |   |   |   |
| Proved                  property costs                  |   | $                                  | 1,977,950  |       | $      | 524,197        |   | $ | 2,502,147 |   |
| Less                  dispositions                      |   |                               | —    |       |   | (227,351       | )      |   | (227,351 | ) |
| Less                  impairment                        |   |                               | (1,262,360 | )          |   | (90,868        | )      |   | (1,353,228 | ) |
| Less                  depletion                         |   |                               | (121,290   | )          |   | (18,832        | )      |   | (140,122 | ) |
| Net                  proved property costs              |   |                               | 594,300    |       |   | 187,146        |   |   | 781,446 |   |
| Unproved                  property costs                |   |                               | 3,673,292  |       |   | 2,568,340      |   |   | 6,241,632 |   |
| Less                  impairment                        |   |                               | (2,994,094 | )          |   | (1,265,065     | )      |   | (4,259,159 | ) |
| Net                  unproved property costs            |   |                               | 679,198    |       |   | 1,303,275      |   |   | 1,982,473 |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |
|                                                    |   | $                                  | 1,273,498  |       | $      | 1,490,421      |   | $ | 2,763,919 |   |
|                                                    |   |                               |       |       |   |           |   |   |   |   |

**Table        III**

**Quantities        of Oil and Natural Gas Reserves**

----

| **Year                    ended December 31, 2004:**                |   | **United                    States** |   | **Canada** |   | **Total** |   |
|-------------------------------------------------------------------------------|--------|--------------------------------------|--------|------------|--------|-----------|--------|
| Proved                    Reserves – Natural Gas And Condensate (McfGE) |   |                                 |   |       |   |      |   |   |   |   |
|                                                                          |   |                                 |   |       |   |      |   |   |   |   |
| Proved                    reserves, beginning of year                         |   |                                 | **-**  |       |   | -         |   |   | - |   |
| Additions,                    February 2004                                   |   |                                 | **-**  |       |   | 31,046    |   |   | 31,046 |   |
| Production                                                                    |   |                                 | **-**  |       |   | (11,046   | )      |   | (11,046 | ) |
| Property                    dispositions                                      |   |                                 | **-**  |       |   | -         |   |   | - |   |
| Proved                    reserves, end of year                               |   |                                 | **-**  |       |   | 20,000    |   |   | 20,000 |   |

**Table        IV**

**Standardized        Measure of Discounted Future Net Cash Flows Related To Proved**

**Oil        and Natural Gas Reserve Quantities**

----

| **Year                  Ended December 31, 2004:**                        |   | **United                  States** |                           | **Canada** |   | **Total**   |   |
|---------------------------------------------------------------------------|--------|------------------------------------|--------------------------------|------------|--------|-------------|--------|
| Future                  cash inflows                                      |   |                               | **Nil**                        |       | **$**  | **126,000** |   | **$** | **126,000** |   |
| Future                  production costs                                  |   |                               | **-**                          |       |   | **(22,300** | **)**  | **$** | **(22,300** | **)** |
| Future                  development costs                                 |   |                               | **-**                          |       |   | **(4,700**  | **)**  | **$** | **(4,700** | **)** |
| Future                  net revenue before income taxes                   |   |                               | **-**                          |       |   | **99,000**  |   | **$** | **99,000** |   |
| 10%                  annual discount for estimated timing of cash flows   |   |                               | **-**                          |       |   | **(14,000** | **)**  | **$** | **(14,000** | **)** |
| Discounted                  future net cash flows before income taxes     |   |                               | **-**                          |       |   | **85,000**  |   | **$** | **85,000** |   |
| Future                  income taxes, discounted at 10% per annum         |   |                               | **-**                          |       |   | **-**       |   | **$** | **-** |   |
| Standardized                  measure of discounted future net cash flows |   |                               | **Nil**                        |       | **$**  | **85,000**  |   | **$** | **85,000** |   |
|                                                                      |   |                               |                           |       |   |        |   |   |   |   |
| Year                  Ended December 31, 2003:                            |   |                               | United                  States |       |   | Canada      |   |   | Total |   |
| Future                  cash inflows                                      |   |                               | Nil                            |       |   | Nil         |   |   | Nil |   |
| Future                  production costs                                  |   |                               | -                              |       |   | -           |   |   | - |   |
| Future                  development costs                                 |   |                               | -                              |       |   | -           |   |   | - |   |
| Future                  net revenue before income taxes                   |   |                               | -                              |       |   | -           |   |   | - |   |
| 10%                  annual discount for estimated timing of cash flows   |   |                               | -                              |       |   | -           |   |   | - |   |
| Discounted                  future net cash flows before income taxes     |   |                               | -                              |       |   | -           |   |   | - |   |
| Future                  income taxes, discounted at 10% per annum         |   |                               | -                              |       |   | -           |   |   | - |   |
| Standardized                  measure of discounted future net cash flows |   |                               | Nil                            |       |   | Nil         |   |   | Nil |   |
|                                                                      |   |                               |                           |       |   |        |   |   |   |   |
| Year                  Ended December 31, 2002:                  |   |                               | United                  States |       |   | Canada      |   |   | Total |   |
| Future                  cash inflows                                      |   | $                                  | 4,770,000                      |       | $      | 448,000     |   | $ | 5,218,000 |   |
| Future                  production costs                                  |   |                               | (1,135,000                     | )          |   | (19,000     | )      |   | (1,154,000 | ) |
| Future                  development costs                                 |   |                               | (113,000                       | )          |   | (34,000     | )      |   | (147,000 | ) |
| Future                  net revenue before income taxes                   |   |                               | 3,522,000                      |       |   | 395,000     |   |   | 3,917,000 |   |
| 10%                  annual discount for estimated timing of cash flows   |   |                               | (1,443,000                     | )          |   | (146,000    | )      |   | (1,589,000 | ) |
| Discounted                  future net cash flows before income taxes     |   |                               | 2,079,000                      |       |   | 249,000     |   |   | 2,328,000 |   |
| Future                  income taxes, discounted at 10% per annum    |   |                               | -                              |       |   | -           |   |   | - |   |
| Standardized                  measure of discounted future net cash flows |   | $                                  | 2,079,000                      |       | $      | 249,000     |   | $ | 2,328,000 |   |
|                                                                      |   |                               |                           |       |   |        |   |   |   |   |

----

**QUARTERLY        FINANCIAL DATA (UNAUDITED)**

| **Interim                  Quarter Ended**             |   | **Dec. 31, 2004** |                           | **Sept. 30                  ,2004** |   | **June 30,                  2004** |   | **March 31,                  2004** |                           |
|--------------------------------------------------------|--------|-----------------------------|--------------------------------|------------------------------------------|--------|-----------------------------------------|--------|------------------------------------------|--------------------------------|
| Revenue                                                |   | **$**                       | **11,639**                     |                                     | **$**  | **17,743**                              |   | **$**                                    | **4,344**                      |   | **$** | **44,599** |   |
| Net                  loss from continuing operations   |   | **$**                       | **(760,201**                   | **)**                                    | **$**  | **(415,619**                            | **)**  | **$**                                    | **(1,011,381**                 | **)** | **$** | **(1,028,714** | **)** |
| Net                  loss from discontinued operations |   | **$**                       | **(2,331**                     | **)**                                    | **$**  | **5,052**                               |   | **$**                                    | **41,805**                     |   | **$** | **(11,032** | **)** |
| Comprehensive                  loss                    |   | **$**                       | **(721,007**                   | **)**                                    | **$**  | **(346,154**                            | **)**  | **$**                                    | **(1,022,979**                 | **)** | **$** | **(1,104,388** | **)** |
| Net                  loss                              |   | **$**                       | **(762,532**                   | **)**                                    | **$**  | **(410,567**                            | **)**  | **$**                                    | **(969,576**                   | **)** | **$** | **(1,039,746** | **)** |
| Basic                  and diluted loss per share      |   | **$**                       | **(0.04**                      | **)**                                    | **$**  | **(0.02**                               | **)**  | **$**                                    | **(0.05**                      | **)** | **$** | **(0.06** | **)** |
|                                                   |   |                        |                           |                                     |   |                                    |   |                                     |                           |   |   |   |   |
| Interim                  Quarter Ended                 |   |                        | Dec.                  31, 2003 |                                     |   | Sept.                  30 ,2003         |   |                                     | June                  30, 2003 |   |   | March                  31, 2003 |   |
| Revenue                                                |   | $                           | -                              |                                     | $      | -                                       |   | $                                        | -                              |   | $ | - |   |
| Net                  loss from continuing operations   |   | $                           | (1,736,398                     | )                                        | $      | (481,719                                | )      | $                                        | (359,995                       | ) | $ | (395,527 | ) |
| Net                  loss from discontinued operations |   | $                           | (6,557                         | )                                        | $      | (26,660                                 | )      | $                                        | (5,618                         | ) | $ | 198,600 |   |
| Net                  loss                              |   | $                           | (1,742,955                     | )                                        | $      | (508,379                                | )      | $                                        | (365,613                       | ) | $ | (196,927 | ) |
| Comprehensive                  loss                    |   | $                           | (1,591,558                     | )                                        | $      | (521,507                                | )      | $                                        | (185,900                       | ) | $ | (53,394 | ) |
| Basic                  and diluted loss per share      |   | $                           | (0.09                          | )                                        | $      | (0.03                                   | )      | $                                        | (0.01                          | ) | $ | - |   |

**Item        9. Changes In And Disagreements With Accountants On Accounting AND FINANCIAL        Disclosure**

----

**Item        9**
**A**
**.        Controls and Procedures**

**PART        III**

**Item        10. Directors And Executive Officers**

| **Donald                    E. Foulkes***Age                    56**Director                    since May 2002* | Mr.                    Foulkes has been a director and the President of AltaCanada Energy                    Corp.                    (TSX: ANG), an oil and gas exploration company, since September                    2002. Mr.                    Foulkes was the Chairman of the Board of Bushmills Energy Corp.                    (TSE:BSH),                    an oil and gas exploration company, from September 2001 until                    January                    2003. Mr. Foulkes was with Causeway Energy Corporation (TSE:CUW),                    an oil                    and gas exploration and production company, from September 1995                    to                    September 2001, where he held the position of President from                    1995 until                    1998 when he became the Chief Executive Officer. From 1992 to                    1995, Mr.                    Foulkes was the President of Highridge Exploration Ltd. (TSE:HRE)                    and from                    1988 to 1992, he was the President of Union Pacific Resources                    Inc., a                    private oil and gas company. Mr. Foulkes serves as a board member                    on our                    two Canadian subsidiaries, NXT Energy Canada, Inc. and NXT Aero                    Canada,                    Inc., as well; he also serves as a board member of 669677 Alberta                    Ltd., a                    private company. Mr.                    Foulkes is a professional geologist and received a Bachelor of                    Science                    degree in                    Geology from the University of Calgary in 1970. Mr.                    Foulkes sits on both our Audit Committee and our Compensation                    Committee. |
|-----------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| **HIS                      HIGHNESS SHEIKH AL HASSAN BIN ALI BIN RASHID AL                      NUAIMI***Age                      41**Director                      since February 2004* | His                      Highness is a member of the Saudi Royal Family. He is Chairman                      of Sea                      Spray Aluminum Boats "Emirates" L.L.C. which operates four                      factories, two                      in the UAE and one factory each in Iran and India.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Dennis                      Hunter***Age                      62**Director                      since September 1998*                                                             | Mr.                      Hunter is an entrepreneur who splits his time equally between                      private                      investment activities and real estate development and management.                      Since 1973, Mr. Hunter has been President and Chairman of the Board                      of Investment Development Management Corporation, which acquires,                      constructs, manages, develops and sells properties in California,                      Oregon                      and Nevada. Mr. Hunter has also been Chairman of the Board                      since 1992, and Vice Chairman of the Board from 1984, of                      Northern Empire Bancshares, a holding company of Sonoma National                      Bank, of                      which Mr. Hunter was a founder in 1982. Mr. Hunter has also been a                      director, since 1988, of Northbay Corporation, a private holding                      company in the solid waste industry with 35 companies in solid waste                      hauling, transfer stations, portable toilets, land fill operations                      and                      real property ownership. Mr. Hunter is also the trustee and                      an investment                      strategist for five charitable remainder trusts collectively                      holding                      over $30 million in net assets. Mr. Hunter sits on the board of                      directors of our two U.S. subsidiaries, NXT Aero USA, Inc.                      and NXT Energy                      USA, Inc. Mr.                      Hunter received his Bachelor of Arts degree in Economics from                      California                      State University Sacramento. Mr.                      Hunter has served on our Compensation Committee since                      February 2000. |
| **George                      Liszicasz***Age                      51**Director                      and Chief Executive Officer since January 1996*                                     | Mr.                      Liszicasz is the inventor of the SFD technology and has been                      our Chairman                      and Chief Executive Officer since inception. Mr. Liszicasz                      was appointed                      our interim President and interim Chief Financial Officer in                      July 2002.                      Mr. Liszicasz's primary responsibilities, as the Chief Executive                      Officer,                      interim President and interim Chief Financial Officer, are                      to ensure the                      smooth running of the day-to-day operations and to further                      develop our SFD                      technology. Prior to founding NXT, Mr. Liszicasz was Vice President                      of                      Susa Petroleum Inc. from 1993 to 1994. From 1987 to 1995, Mr.                      Liszicasz                      was President of Owl Industries Ltd., a developer of electronic                      controlling devices, where he had both engineering and business                      responsibilities. Mr. Liszicasz serves as a board member of                      each of our                      four subsidiaries; NXT Energy Canada, Inc., NXT Energy USA,                      Inc., NXT Aero                      Canada, Inc. and NXT Aero USA, Inc. Mr.                      Liszicasz studied electronics and general sciences at the University                      of                      British Columbia and obtained a High Voltage Controls and Station                      Operations degree in Electronics from the Landler Jeno Technitken                      in                      Hungary in 1973.                                                                                                                                                                                                      |
| **Douglas                      Rowe***Age                      62**Director                      since May 2002*                                                                         | Mr.                      Rowe has been the President, Chief Executive Officer and a                      director of                      Birch Mountain Resources Ltd. (TSX:BMD; OTCBB:BHMNF), a Canadian                      junior                      mineral exploration company, since 1994. Prior to that he was                      Chairman and                      President of Brougham Geoquest, Ltd., a company engaged in                      mineral                      exploration, from 1986 to 1993, and Brougham Energy Corporation,                      a company                      engaged in oil and gas exploration and development, from 1984                      to 1986. Mr.                      Rowe also sits on the board of directors of our two Canadian                      subsidiaries,                      NXT Aero Canada, Inc. and NXT Energy Canada, Inc. Mr.                      Rowe is a professional engineer with a Bachelors of Science                      degree in                      Electrical Engineering from Queen’s University which he obtained in 1967                      and has over 30 years of industry experience. Mr.                      Rowe is                      chairman of our Compensation                      Committee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |

----

| **Scott                      R. Schrammar***Age                      55**Corporate                      Secretary since September 2002* | Mr.                      Schrammar retired in 1992. From 1989 to 1992, Mr. Schrammar                      was an                      independent trader at the American Stock Exchange. From 1983                      to 1988, he                      was Head Floor Broker for Moseley, Hallgarten, Estabrook and                      Weeden at the                      American Stock Exchange. Mr. Schrammar is the Corporate Secretary                      of all                      of our subsidiaries. Mr.                      Schrammar graduated Summa Cum Laude from the City University                      of New York                      with his Bachelor degree in Psychology in 1974 prior to continuing                      his                      studies at the Brooklyn Law School and receiving his Juris                      Doctor Degree                      in 1978.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|-----------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Robert                      Van Caneghan***Age                      57**Director                      since May 2002*                 | Mr.                      Van Caneghan retired in 1994. He has over 25 years of experience                      as a                      market maker and specialist broker. From 1984 to 1994, he was                      a principal                      of Miceli-Van Caneghan, a specialist firm located on the AMEX                      floor. Mr.                      Van Caneghan was also a member of the American Stock Exchange                      Board of                      Governance from 1988 to 1994. Mr. Van Caneghan currently is                      a board member                      of our two U.S. subsidiaries, NXT Energy USA, Inc. and NXT                      Aero USA, Inc.                      and of the Financial Resources Federal Credit Union. In                      1969, Mr. Van Caneghan graduated from Wagner College with a                      Bachelor of                      Science in Economics. He then obtained a Masters Degree in                      Finance from                      the New York University Stern School of Business in 1974. Mr.                      Van Caneghan                      attended Brooklyn Law School where he graduated with a Juris                      Doctor degree                      in 1978. Mr.                      Van Caneghan is a member of our Audit Committee.                                                                                                                                                                                                                                                               |
| **Brian                      Kohlhammer***Age                      41**Director                      since December 2004*          | Mr.                      Kohlhammer is a Chartered Accountant with over eighteen years                      experience                      in financial management reporting including four years public                      accounting                      and fourteen years financial forecasting, analysis and                      reporting. Since                      December 2004, Mr. Kohlhammer has been serving as Vice President                      of                      Financial and Chief Financial Officer for Delphi Energy Corp.,                      a public                      junior oil and gas company in Canada traded on the Toronto                      Stock Exchange                      and based in Calgary, Alberta. From 2001 to 2004, Mr. Kohlhammer                      served as                      Vice President of Financial and Chief Financial Officer for                      Virtus Energy                      Ltd., a public junior oil and gas exploration and production                      company                      traded on the TSX Venture Exchange and based in Calgary, Alberta.                      From                      2000 to 2001, Mr. Kohlhammer served as Vice President of Financial                      and                      Chief Financial Officer for Patchgear.com Inc., an Internet                      based B2B e commerce public company in the safety equipment                      sector                      that was located in Calgary, Alberta. Mr. Kohlhammer is a member                      of our                      Audit Committee. |

----

**Section        16(a) Beneficial Ownership Reporting Compliance**

| **Name**                                                                      | **Reporting                    Person**                             | **Form                    3/# of transactions** | **Form                    4/# of transactions** | **Form                    5/# of transactions** |
|-------------------------------------------------------------------------------|---------------------------------------------------------------------|-------------------------------------------------|-------------------------------------------------|-------------------------------------------------|
| George                    Liszicasz                                           | President                    & Member of the Board of Directors | N/A                                             | Late/3                                          | N/A                                             |
| Jarmila                    Manasek                                            | Vice-President-Finance                                              | Late/1                                          | Late/1                                          | N/A                                             |
| Brian                    Kohlhammer                                           | Member                    of the Board of Directors                 | Late/1                                          | N/A                                             | N/A                                             |
| Bin                    Ali Bin Rashid Al Nuaimi His Highness Sheikh Al Hassan | Member                    of the Board of Directors                 | Late/1                                          | N/A                                             | N/A                                             |
| Stephens                    Group Inc.                                        | 10%                    Owner                                        | N/A                                             | N/A                                             | Late/1                                          |
| SFD                    Investment LLC                                         | 10%                    Owner                                        | N/A                                             | N/A                                             | Late/1                                          |

**Board        Committees**

**Compensation        Committee Interlocks and Insider Participation**

**Board        and Committee Meetings**

----

**Item        11. Executive Compensation**

| · | Our                  Chief Executive Officer;                                                                                                                                                                 |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | Our                  four other most highly compensated executive officers (if any),                  whose                  annual salary and bonus exceeded $100,000 in the aggregate;                  and |

|                                                                      |   |     |   |                                     |   |      |   |                           |   | **Long                  Term Compensation** |   |                                                       |   |                                         |   |                                        |   |
|---------------------------------------------------------------------------|--------|----------|--------|------------------------------------------|--------|-----------|--------|--------------------------------|--------|---------------------------------------------|--------|------------------------------------------------------------|--------|----------------------------------------------|--------|---------------------------------------------|--------|
|                                                                      |   |     |   | **Annual                  Compensation** |   |      |   | **Awards**                     |   | **Payouts**                                 |   |                                                       |   |                                         |   |                                        |   |
| **Named                  Executive Officer and Principal Position**  |   | **Year** |   | **Salary (1)**                      |   | **Bonus** |   | **Other                  (2)** |   | **Restricted                  Stock**       |   | **Securites                  Underlying Options and SARs** |   | **Log                  Term Incentive Plan** |   | **All                  Other Compensation** |   |
| George                  Liszicasz (6)                                     |   |     | 2004   |                                     | $      | 116,373   |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
| *Chief                  Executive Officer*                                |   |     | 2003   |                                     | $      | 99,415    |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
|                                                                      |   |     | 2002   |                                     | $      | 83,671    |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
|                                                                      |   |     |   |                                     |   |      |   |                           |   |                                        |   |                                                       |   |                                         |   |                                        |   |   |   |   |   |   |   |   |   |
| Daniel                  C. Topolinsky (3)                            |   |     | 2004   |                                     | $      | ---       |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
| *Former                  President and Chief Operating Officer*           |   |     | 2003   |                                     | $      | ---       |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
|                                                                      |   |     | 2002   |                                     | $      | 62,187    |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
|                                                                      |   |     |   |                                     |   |      |   |                           |   |                                        |   |                                                       |   |                                         |   |                                        |   |   |   |   |   |   |   |   |   |
| James                  R. Ehrets (4)                                 |   |     | 2004   |                                     | $      | ----      |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
| *Former                  Vice President Exploration (U.S.)*               |   |     | 2003   |                                     | $      | ----      |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
|                                                                      |   |     | 2002   |                                     | $      | 194,802   |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
|                                                                      |   |     |   |                                     |   |      |   |                           |   |                                        |   |                                                       |   |                                         |   |                                        |   |   |   |   |   |   |   |   |   |
| John                  M. Woodbury** **(5)                            |   |     | 2004   |                                     | $      | ---       |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
| *Former                  Chief Financial Officer & General Counsel*   |   |     | 2003   |                                     | $      | ---       |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |
|                                                                      |   |     | 2002   |                                     | $      | 90,209    |   |                           | ---    |                                        |   | ---                                                        |   |                                         | ---    |                                        |   | --- |   |   | --- |   |   | --- |   |

|   | (1) | NXT                  ordinarily pays salaries to our executive officers in Canadian                  dollars.                  The amounts shown as paid in this table have been converted into                  United                  States dollars based upon the average exchange rate for the year                  of                  payment used in preparing our consolidated financial                  statements. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Includes,                  among other things, perquisites and other personal benefits, securities                  or                  property which exceed in the aggregate the lesser of either $50,000                  or 10% of the total annual salary and bonus reported for that                  year.  |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Mr.                  Topolinsky resigned as NXT's President and Chief Operating Officer                  and as                  a director of NXT effective April 19, 2002. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (4) | Effective                  March 1, 2002, Mr. Ehrets became                  NXT's Vice President Exploration (U.S.). Prior to that Mr. Ehrets                  was                  NXT's Executive Vice President of Operations. Mr. Ehrets’ contract expired                  on October 31, 2002 and was not                  renewed. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (5) | Mr.                  Woodbury’s contract expired on July 8, 2002 and was not renewed. |
|--------|-----|---------------------------------------------------------------------------------------------|

|   |  (6) | In                  January 2002, Mr. Liszicasz accepted a 50% reduction in his annual                  salary. |
|--------|-----------|-----------------------------------------------------------------------------------------------------------------|

----

**Summary        of Stock Options and Stock Appreciation Rights Granted To Executive        Officers**

| **Individual                    Grants** |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   | **Potential                    Realized Value at Assumed Annual Rates of Stock Price Appreciation                    for                    Option Term** |   |                             |   |
|------------------------------------------|--------|----------------------------------------------------------------------------|---------|-------------------------------------------------------|--------|---------------------------------------------------------|--------|---------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------|--------|
| **Name**                                 |   | **Number                    of Securities Underlying Options Granted (#)** |    | **%                    of Total Options Granted (1)** |   | **Exercise                    or Base Price ($/Sh)(2)** |   | **Expiration                    Date (mm/dd/yy)** |   | **5%                    ($)**                                                                                                                             |   | **10%                    ($)**   |   |
| Donald                    Foulkes        |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 0.38   |                                                                                                                                                      |   | 08/13/07                         |   |   | 4,199 |   |   | 9,280 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 0.43   |                                                                                                                                                      |   | 08/09/2008                       |   |   | 4,752 |   |   | 10,500 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 2.15   |                                                                                                                                                      |   | 12/08/2009                       |   |   | 23,760 |   |   | 52,504 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
| Dennis                    Hunter         |   |                                                                       | 45,000  |                                                  |   | 2.66                                                    | %      |                                              | 2.00   |                                                                                                                                                      |   | 02/15/06                    thru |   |   | 24,865 |   |   | 54,946 |   |
| 04/17/08                                 |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
|                                     |   |                                                                       | 20,000  |                                                  |   | 1.18                                                    | %      |                                              | 0.38   |                                                                                                                                                      |   | 08/13/07                         |   |   | 2,100 |   |   | 4,640 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 0.43   |                                                                                                                                                      |   | 08/09/2008                       |   |   | 4,752 |   |   | 10,500 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 2.15   |                                                                                                                                                      |   | 12/08/2009                       |   |   | 23,760 |   |   | 52,504 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
| George                    Liszicasz      |   |                                                                       | 15,000  |                                                  |   | 0.89                                                    | %      |                                              | 2.00   |                                                                                                                                                      |   | 05/05/03                    thru |   |   | 8,927 |   |   | 19,926 |   |
| 05/20/04                                 |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
|                                     |   |                                                                       | 30,000  |                                                  |   | 1.77                                                    | %      |                                              | 0.14   |                                                                                                                                                      |   | 03/27/08                         |   |   | 1,160 |   |   | 2,564 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 0.43   |                                                                                                                                                      |   | 08/09/2008                       |   |   | 4,752 |   |   | 10,500 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 2.15   |                                                                                                                                                      |   | 12/08/2009                       |   |   | 23,760 |   |   | 52,504 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
| Douglas                    Rowe          |   |                                                                       | 30,000  |                                                  |   | 1.77                                                    | %      |                                              | 0.38   |                                                                                                                                                      |   | 08/13/07                         |   |   | 3,150 |   |   | 6,960 |   |
|                                     |   |                                                                       | 10,000  |                                                  |   | 0.59                                                    | %      |                                              | 0.29   |                                                                                                                                                      |   | 09/20/07                         |   |   | 801 |   |   | 1,770 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 0.43   |                                                                                                                                                      |   | 08/09/2008                       |   |   | 4,752 |   |   | 10,500 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 2.15   |                                                                                                                                                      |   | 12/08/2009                       |   |   | 23,760 |   |   | 52,504 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
| Robert                    Van Caneghan   |   |                                                                       | 30,000  |                                                  |   | 1.77                                                    | %      |                                              | 0.38   |                                                                                                                                                      |   | 08/13/07                         |   |   | 3,150 |   |   | 6,960 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 0.43   |                                                                                                                                                      |   | 08/09/2008                       |   |   | 4,752 |   |   | 10,500 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 2.15   |                                                                                                                                                      |   | 12/08/2009                       |   |   | 23,760 |   |   | 52,504 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
| Brian                    Kohlhammer      |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 1.47   |                                                                                                                                                      |   | 12/23/2009                       |   |   | 16,245 |   |   | 35,898 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
| Scott                    Schrammar       |   |                                                                       | 30,000  |                                                  |   | 1.77                                                    | %      |                                              | 0.14   |                                                                                                                                                      |   | 03/27/08                         |   |   | 1,160 |   |   | 2,564 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 0.43   |                                                                                                                                                      |   | 08/09/2008                       |   |   | 4,752 |   |   | 10,500 |   |
|                                     |   |                                                                       | 40,000  |                                                  |   | 2.36                                                    | %      |                                              | 2.15   |                                                                                                                                                      |   | 12/08/2009                       |   |   | 23,760 |   |   | 52,504 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
| Jarmila                    Manasek       |   |                                                                       | 100,000 |                                                  |   | 5.91                                                    | %      |                                              | 1.47   |                                                                                                                                                      |   | 12/23/2009                       |   |   | 40,613 |   |   | 89,745 |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |
|                                     |   |                                                                       |    |                                                  |   |                                                    |   |                                              |   |                                                                                                                                                      |   |                             |   |   |   |   |   |   |   |

| (1) | Based                      on options exercisable to acquire a total 1,805,135                      shares to executive officers, directors and employees.                                                                            |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | The exercise price per share was equal to                      the fair market                      value of the common stock on the date of grant as determined                      by the board                      of directors. |

----

| · | multiplying                  the number of shares of common stock subject to a given option                  by the                  exercise price;                                                                                                        |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | assuming                  that the aggregate stock value derived from that calculation compounds                  at                  the annual 5% or 10% rate shown in the table for the entire term                  of the                  option; and |
| · | subtracting                  from that result the aggregate option exercise                  price.                                                                                                                                                         |

**Summary        of Stock Options and Stock Appreciation Rights Exercised By Executive Officers        and Year End Balances**

|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                        | **at                  December 31, 2004**                     |
|----------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------|-------------------------------------------------------------------------|
|  **Named                  Executive Officer** | **Shares****Acquired                  On Exercise**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  **Value****Realized** |  **Options                  at FY-End**(Exercisable/Unexercisable) | **Value                  of In-the-Money Options at FY-End ****(1)                  (2)**(Exercisable/Unexercisable) |
| George                  Liszicasz                  | ---                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | ---                         | 38,333  / 86,667                                         | $35,800  /  $71,600 |
| Jarmila                  Manasek                   | ---                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | ---                         | 0                  / 100,000                                            | $0  /  $37,000 |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                        |                                                                    |   |
| (1)                                                | The                  dollar amount shown represents the difference between the fair                  market                  value of our common shares underlying the options as of the date                  of                  exercise and the option exercise price.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (2)                                                | The                  dollar value provided represents the cumulative difference in the                  fair                  market value of our common shares underlying all in-the-money options                  as                  of December 31, 2004 and the exercise prices for those options.                  Options are considered "in-the-money" if the fair market value                  of the                  underlying common shares as of the last trading day in 2004 exceeds                  the                  exercise price of those options. The fair market value of our common                  shares for purposes of this calculation is $1.84, based upon the                  closing price for our common shares on December 31, 2004, the                  last trading day in 2004. |

**Director        Compensation**

**Indemnification        of Directors, Officers and Others**

----

**Employment        Agreement With Our Executive Officer**

| · | An                  initial base salary of CDN $21,000 per month, with an automatic                  increase                  of 5% on each anniversary date. However, Mr. Liszicasz reduced                  his monthly                  salary to CDN $10,500. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | An                  annual bonus equal to 5% of our "net income after taxes" in the                  event we                  earn more than $5 million in net income after taxes in any                  year.                                                   |
| · | An                  annual performance bonus, as determined in the sole discretion                  of our                  board of directors.                                                                                                                    |

| · | death                  or disability;                                                           |
|--------|-------------------------------------------------------------------------------------------------|
| · | a                  "change in control" of NXT;                                                  |
| · | termination                  of employment by NXT for "cause;" or                               |
| · | termination                  of employment by Mr. Liszicasz for "good                  reason." |

| · | an                  acquisition whereby immediately after such acquisition, a person                  holds                  beneficial ownership of more than 50% of the total combined voting                  power                  of our then outstanding voting securities;                                                                                                                                                                                                                                                                         |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | if                  in any period of three consecutive years after the date of the                  employment                  agreement, the then incumbent members of our board of directors                  cease to                  constitute a majority of the board for reasons other than voluntary                  resignation, refusal by one or more members of our board of directors                  to                  stand for election, or removal of one or more board member for                  good cause;                  or |
| · | our                  board of directors or shareholders approve a merger, consolidation                  or                  reorganization of NXT; the complete liquidation or dissolution                  of NXT; or                  the agreement for the sale or other disposition of all or substantially                  all of NXT's assets.                                                                                                                                                                                                     |

**ITEM        12. Ownership Of NXT’s Securities by Beneficial Owners And        Management**

| · | each                    of our current directors and executive                    officers; |
|--------|---------------------------------------------------------------------------------------------|

----

| · | each                    person who is a beneficial owner of more than 5% of any class                    of our                    outstanding securities with voting rights; and |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | the                    group comprised of our current directors and executive                    officers.                                                                        |

----

|   |                                                                                                                                                                                                                                                                                                                                                                 |   | **Stock**    |   |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------|--------|
|   | **Name**                                                                                                                                                                                                                                                                                                                                                             |   | **Amount**   |   |   | **%****(1)** |   |
|   | **Directors                  & Officers**                                                                                                                                                                                                                                                                                                                        |   |         |   |   |   |   |
|   | George                  Liszicasz (2)                                                                                                                                                                                                                                                                                                                                |   | 5,154,823(3) |   |   | 24.31% |   |
|   | 383                  Arbour Lake Way NW                                                                                                                                                                                                                                                                                                                              |   |         |   |   |   |   |
|   | Calgary,                  Alberta T3G 4A2                                                                                                                                                                                                                                                                                                                            |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Dennis                  R. Hunter                                                                                                                                                                                                                                                                                                                                    |   | 432,932(4)   |   |   | 2.04% |   |
|   | Box                  9069                                                                                                                                                                                                                                                                                                                                            |   |         |   |   |   |   |
|   | Santa                  Rosa, CA 95405                                                                                                                                                                                                                                                                                                                                |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Donald                  E. Foulkes                                                                                                                                                                                                                                                                                                                                   |   | 39,999(5)    |   |   | 0.19% |   |
|   | 39                  Pinnacle Ridge Dr.                                                                                                                                                                                                                                                                                                                               |   |         |   |   |   |   |
|   | Calgary,                  Alberta T3Z 3N7                                                                                                                                                                                                                                                                                                                            |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | His                  Highness Sheikh Al Hassan Bin Ali Bin Rashid Al Nuaimi                                                                                                                                                                                                                                                                                          |   | 0            |   |   | 0% |   |
|   | Ajman,UAE                                                                                                                                                                                                                                                                                                                                                            |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Douglas                  Rowe                                                                                                                                                                                                                                                                                                                                        |   | 39,999(6)    |   |   | 0.19% |   |
|   | 246                  Artist View Way                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Calgary,                  Alberta T3N 3N1                                                                                                                                                                                                                                                                                                                            |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Robert                  Van Caneghan                                                                                                                                                                                                                                                                                                                                 |   | 33,333(7)    |   |   | 0.15% |   |
|   | 123                  Redcliff Road                                                                                                                                                                                                                                                                                                                                   |   |         |   |   |   |   |
|   | Staten                  Island, NY 10305                                                                                                                                                                                                                                                                                                                             |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Brian                  Kohlhammer                                                                                                                                                                                                                                                                                                                                    |   | 39,000       |   |   | 0.18% |   |
|   | 6612                  Silverview Drive NW                                                                                                                                                                                                                                                                                                                            |   |         |   |   |   |   |
|   | Calgary,                  AB T3B 3K8                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Scott                  Schrammar(2)                                                                                                                                                                                                                                                                                                                                  |   | 33,333(8)    |   |   | 0.15% |   |
|   | 9438                  U.S. 19 North, PMB 210                                                                                                                                                                                                                                                                                                                         |   |         |   |   |   |   |
|   | Port                  Richey, FL 34668                                                                                                                                                                                                                                                                                                                               |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Jarmila                  Manasek(2)                                                                                                                                                                                                                                                                                                                                  |   | 0            |   |   | 0.00% |   |
|   | 76                  Midridge Close SE                                                                                                                                                                                                                                                                                                                                |   |         |   |   |   |   |
|   | Calgary,                  AB T2X 1G1                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
|   | Current                  directors, director-nominees                                                                                                                                                                                                                                                                                                                |   | 5,773,419(9) |   |   |   |   |
|   | and                  executive officers, as a group                                                                                                                                                                                                                                                                                                                  |   |         |   |   |   |   |
|   |                                                                                                                                                                                                                                                                                                                                                                 |   |         |   |   |   |   |
| (1)    | Rule                  13d-3 under the Securities Exchange Act defines the term, "beneficial                  ownership". Under this rule, the term includes shares over which                  the                  indicated beneficial owner exercises voting and/or investment power.                  The                  rules also deem common shares subject |
| (2)    | Executive                  officer.                                                                                                                                                                                                                                                                                                                                  |
| (3)    | Includes                  5,062,490 common shares directly held by Mr. Liszicasz, and options                  exercisable within 60 days of March 31, 2005 to acquire 48,333                  common                  shares.                                                                                                                                       |
| (4)    | Includes                  361,266 common shares and options exercisable within 60 days of                  March 31,                  2005 to acquire 71,666 common shares.                                                                                                                                                                                          |
| (5)    | Includes                  25,000 common shares and options exercisable within 60 days of                  March 31,                  2005 to acquire 39,999 common shares.                                                                                                                                                                                           |
| (6)    | Includes                  25,000 common shares and options exercisable within 60 days of                  March 31,                  2005 to acquire 39,999 common shares.                                                                                                                                                                                           |
| (7)    | Includes                  options exercisable within 60 days of March 31, 2005 to acquire                  33,333                  common shares.                                                                                                                                                                                                                    |
| (8)    | Includes                  options exercisable within 60 days of March 31, 2005 to acquire                  33,333                  common shares.                                                                                                                                                                                                                    |
| (9)    | Includes                  5,506,756 common shares and options exercisable within 60 days                  of March                  31, 2005 to acquire 263,663 common                  shares.                                                                                                                                                                      |

----

**Item        13. Certain Relationships And Related Transactions**

| **December 31**                                                                                                                                             |   | **2004** |        | 2003   |   | 2002    |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|-------------|--------|--------|---------|--------|
|                                                                                                                                                             |   |     |        |   |   |    |   |
| Collective                  legal fees expensed to law firms with partners who were also directors                  of                  NXT or NXT Energy Canada |   |     | **Nil**     |   |   | Nil     |   | $ | 72,440 |   |
|                                                                                                                                                             |   |     |        |   |   |    |   |   |   |   |
| Collective                  wages, fees and benefits paid to executive officers of NXT, who                  were also                  directors of NXT         |   | **$**    | **116,373** |   | $      | 107,382 |   | $ | 234,958 |   |
|                                                                                                                                                             |   |     |        |   |   |    |   |   |   |   |
| Accounts                  receivable due from executive officers                                                                                                 |   | **$**    | **5,803**   |   |   | Nil     |   | $ | 5,004 |   |

**Item        14. Principal accounting fees and services**

**audit        fees**

**TAX        FEES**

**ALL        OTHER FEES**

----

**AUDIT        COMMITTEE APPROVAL**

**PART        IV**

**Item        15. Exhibits, Financial Statement Schedules**

| 2.1                    (1)   | Reorganization                    Plan dated September 28, 1994 between Mega-Mart, Inc. and Auric                    Mining Corporation                                                                          |
|-----------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.2                    (1)   | Reorganization                    Plan dated December 31, 1995 between Auric Mining Corporation                    and Fiero Mining Corporation                                                                  |
| 2.3                    (1)   | Reorganization                    Plan dated January 20, 1996 between Auric Mining Corporation and                    Pinnacle Oil Inc.                                                                          |
| 2.4                    (1)   | Articles                    of Incorporation of Auric Mining Corporation as filed with the                    Nevada                    Secretary of State on September 27, 1994                                      |
| 3.2                    (1)   | Amendment                    to Articles of Incorporation of Auric Mining Corporation as filed                    with the                    Nevada Secretary of State on February 23, 1996                     |
| 3.3                    (1)   | Certificate                    of Amendment to Articles of Incorporation of Pinnacle Oil International,                    Inc. as filed with the Nevada Secretary of State on                    April 1, 1998  |
| 3.4                    (6)   | Certificate                    of Amendment to Articles of Incorporation of Pinnacle Oil International,                    Inc. as filed with the Nevada Secretary of State on                    June 13, 2000  |
| 3.5                    (1)   | Amended                    Bylaws for Energy Exploration Technologies                                                                                                                                                      |
| 3.6                    (1)   | Pinnacle                    Oil International, Inc. specimen common stock certificate                                                                                                                                      |
| 3.7                    (1)   | Pinnacle                    Oil International, Inc. specimen series 'A' preferred stock                    certificate                                                                                                     |
| 3.8                    (1)   | Energy                    Exploration Technologies specimen common stock certificate                                                                                                                                       |
| 3.9                    (1)   | Form                    of Non-Qualified Stock Option Agreement for grants to                    directors                                                                                                                 |
| 3.10                    (1)  | 1997                    Pinnacle Oil International, Inc. Stock Plan                                                                                                                                                        |
| 3.11                    (3)  | Form                    of Stock Option Certificate for grants to employees under the 1997                    Pinnacle Oil International, Inc. Stock Plan                                                             |
| 3.12                    (1)  | Warrant                    certificate for 200,000 Common Shares issued to SFD Investment                    LLC                                                                                                      |
| 3.13                    (4)  | 1999                    Pinnacle Oil International, Inc. Executive Stock Option Plan                                                                                                                                       |
| 3.14                    (4)  | Form                    of Stock Option Certificate for grants to directors under the 2000                    Pinnacle Oil International, Inc. Executive Stock Option Plan                                            |
| 3.15                    (7)  | 2000                    Pinnacle Oil International, Inc. Directors' Stock Plan                                                                                                                                        |

----

| 3.16                      (7)   | Form                      of Stock Option Certificate for grants to directors under the 2000                      Pinnacle Oil International, Inc. Directors' Stock Plan                                   |
|--------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.17                      (1)   | Stockholder                      Agreement dated April 3, 1998 among Pinnacle Oil International,                      Inc., R. Dirk Stinson, George Liszicasz and SFD Investment                      LLC  |
| 3.18                      (9)   | Amended                      By-laws of Energy Exploration Technologies, - Amended September                      20,                      2002                                                                      |
| 10.1                      (1)   | Partnership                      Agreement of Messrs. Liszicasz and Stinson dated                      September 1, 1995                                                                                   |
| 10.2                      (1)   | Agreement                      between Pinnacle Oil Inc. and Mr. Liszicasz dated                      January 1, 1996                                                                                      |
| 10.3                      (1)   | Transfer                      Agreement by Momentum Resources Corporation dated                      June 18, 1996                                                                                         |
| 10.4                      (1)   | Restated                      Technology Agreement dated August 1, 1996                                                                                                                                    |
| 10.5                      (1)   | Amendment                      to Restated Technology Agreement with Momentum Resources Corporation                      dated                      April 3, 1998                                          |
| 10.7                      (1)   | Letter                      Agreement with Encal Energy Ltd. dated                      December 13, 1996                                                                                                  |
| 10.8                      (1)   | Exploration                      Joint Venture Agreement with Encal Energy Ltd. dated                      February 19, 1997                                                                               |
| 10.9                      (1)   | Exploration                      Joint Venture Agreement with Encal Energy Ltd. dated                      September 15, 1997                                                                              |
| 10.10                      (8)  | Letter                      Amending Joint Venture Agreement with Encal Energy Ltd. dated                      April 1, 2000                                                                          |
| 10.11                      (1)  | Letter                      Agreement with Renaissance Energy Ltd. dated                      April 16, 1997                                                                                               |
| 10.12                      (1)  | SFD                      Survey Agreement with Renaissance Energy Ltd. dated                      November 1, 1997                                                                                         |
| 10.13                      (1)  | SFD                      Survey Agreement with Renaissance Energy Ltd. dated                      February 1, 1998 (Prospect Lands #1)                                                                     |
| 10.14                      (1)  | SFD                      Survey Agreement with Renaissance Energy Ltd. dated                      February 1, 1998 (Prospect Lands #2)                                                                     |
| 10.15                      (1)  | Joint                      Exploration and Development Agreement with CamWest Limited                      Partnership                      dated April 3, 1998                                            |
| 10.16                      (1)  | Assignment                      of Joint Exploration and Development Agreement with CamWest                      Exploration                      LLC dated January 29, 1999                               |
| 10.17                      (1)  | Canadian                      Data License Agreement with Pinnacle Oil Canada Inc. dated                      April 1, 1997                                                                                |
| 10.18                      (1)  | American                      Data License Agreement with Pinnacle Oil Inc. dated                      April 1, 1997                                                                                       |
| 10.19                      (1)  | Cost                      Recovery Agreement with Pinnacle Oil Canada Inc. dated                      April 1, 1997                                                                                        |
| 10.20                      (1)  | Assignment                      Agreement with Pinnacle Oil Canada Inc. dated                      September 15, 1997                                                                                      |
| 10.21                      (1)  | Assignment                      Agreement with Pinnacle Oil Canada Inc. dated                      April 1, 1997                                                                                           |
| 10.22                      (1)  | Assignment                      Agreement with Pinnacle Oil Canada Inc. dated                      November 1, 1997                                                                                        |
| 10.23                      (1)  | Employment                      Agreement dated April 1, 1997 with Mr. Dirk Stinson                                                                                                                        |
| 10.24                      (1)  | Employment                      Agreement dated April 1, 1997 with Mr. George                      Liszicasz                                                                                               |

----

| 10.25                        (1)  | Unsecured                        Convertible Promissory Note ($500,000) in favor of Mr.                        Liszicasz                                                                                                                                |
|----------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.26                        (1)  | Unsecured                        Convertible Promissory Note ($500,000) in favor of Mr.                        Stinson                                                                                                                                  |
| 10.27                        (1)  | Promissory                        Notes of Pinnacle Oil Inc. in favor of Messrs. Liszicasz                        and Stinson dated                        October 21, 1995                                                                   |
| 10.28                        (1)  | Registration                        and Participation Rights Agreement dated April 3, 1998 between                        Pinnacle Oil International, Inc. and SFD Investment LLC                                                             |
| 10.29                        (1)  | Form                        of Indemnification Agreement between Pinnacle Oil International,                        Inc. and                        each Director and Executive Officer                                                                 |
| 10.30                        (1)  | Lease                        Agreement between Phoenix Place Ltd. and Pinnacle Oil International,                        Inc.                        dated November 25, 1997                                                                  |
| 10.31                        (2)  | Employment                        Agreement dated July 9, 1998 with John M. Woodbury,                        Jr.                                                                                                                              |
| 10.32                        (5)  | Assignment                        Of Joint Exploration and Development Agreement between CamWest                        Limited                        Partnership and CamWest Exploration LLC dated                        January 29, 1999  |
| 10.33                        (5)  | Settlement                        Agreement dated April 27, 1999                                                                                                                                                                              |
| 10.34                        (5)  | Employment                        Agreement dated May 1, 1999 with Daniel C.                        Topolinsky                                                                                                                                |
| 10.35                        (5)  | Employment                        Agreement dated May 1, 1999 with James R. Ehrets                                                                                                                                                            |
| 10.36                        (8)  | Promissory                        Note by NXT Aero USA Inc. dated November 6, 2000 to Aviation                        Finance Group LLC                                                                                                       |
| 10.37                        (8)  | Aircraft                        Loan Agreement by NXT Aero USA Inc. dated November 6, 2000 with                        Aviation Finance Group LLC                                                                                             |
| 10.38                        (8)  | Aircraft                        Security Agreement by NXT Aero USA Inc. dated November 6, 2000                        with Aviation Finance Group LLC                                                                                         |
| 10.39                        (8)  | Commercial                        Guaranty by Energy Exploration Technologies dated                        November 6, 2000 to Aviation Finance Group LLC                                                                                     |
| 10.40                        (8)  | Terminating                        Events Addendum dated November 6, 2000 with Aviation Finance                        Group LLC                                                                                                              |
| 10.41(10)                         | Employment                        Agreement dated December 1, 2002 with George Liszicasz                                                                                                                                                                |
| 14                        (11)    | Code                        of Ethics                                                                                                                                                                                                                   |
| 21                        (8)     | List                        of significant subsidiaries                                                                                                                                                                                                 |
| 23                                | Consent                        of Dr. Nimr Arab to file copy of his Report as Exhibit 99.5                        to this Annual                        Report on Form 10-K                                                                             |
| 31.1                              | Rule                        13a-14(a)/15d-14(a)                        Certification                                                                                                                                                                    |
| 31.2                              | Rule                        13a-14(a)/15d-14(a)                        Certification                                                                                                                                                                    |
| 32.1                              | Section                        1350 Certification                                                                                                                                                                                                       |
| 32.2                              | Section                        1350 Certification                                                                                                                                                                                                       |

----

| 99.1                        (1)  | Report                        captioned "*Evaluation                        of Stress Field Detector Technology—Implications for Oil and Gas                        Exploration in Western Canada*"                        dated September 30, 1996 prepared by Rod Morris, P. geologist,                        A.P.E.G.G.A.            |
|---------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 99.2                        (1)  | Report                        regarding "*Stress                        Field Detector Technology*"                        dated May 22, 1998 prepared by Encal Energy Ltd.                                                                                                                                                                    |
| 99.3                        (2)  | Report                        captioned "*SFD                        Data Summary*"                        dated August 26, 1998 prepared by CamWest, Inc.                                                                                                                                                                                     |
| 99.4                        (1)  | Report                        captioned "*Pinnacle                        Oil International Inc.—Stress Field Detector Documentation of Certain                        Exploration and Evaluation Activities*"                        dated February 27, 1998 prepared by Gilbert Laustsen Jung                        Associates Ltd.   |
| 99.5                             | Report                        of Dr. Nimr Arab dated September 2004, entitled: “*Evaluation                        Survey of the Stressfield Detector Technology Conducted in                        Syria During                        2004*”                                                                                              |
|                                  |                                                                                                                                                                                                                                                                                                                                                          |
|                                  | (1)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Registration Statement                        on Form 10                        filed on June 29, 1998 (U.S. Securities and Exchange Commission                        File No. 0-24027)  |
|                                  | (2)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Amendment No. 1 to Registration                        Statement on Form 10 filed on August 31, 1998  |
|                                  | (3)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Annual Report on Form 10-K for                        our year ended December 31, 1998 as filed on                        March 31, 1999  |
|                                  | (4)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Registration Statement                        on                        Form S-8 (U.S. Securities and Exchange Commission File                        No. 333-89251) as filed on March 31, 1999  |
|                                  | (5)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Annual Report on Form 10-K for                        our year ended December 31, 1999 as filed on                        April 17, 2000  |
|                                  | (6)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of Amendment No. 1 to our Annual Report                        on Form 10-K for our year ended December 31, 1999 as filed                        on July 28, 2000  |
|                                  | (7)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Quarterly Report on Form                        10-Q for the                        quarter ended March 31, 2000 as filed on May 15, 2000.  |
|                                  | (8)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Annual Report on Form                        10-K for the                        year ended December 31, 2001 as filed on April 1, 2002.  |
|                                  | (9)                                                                                                                                                                                                                                                                                                                                                      | Previously                        filed by our company as part of our Quarterly Report on Form                        10-Q for the                        quarter ended September 30, 2002 as filed on November 14,                        2002  |
|                                  | (10)                                                                                                                                                                                                                                                                                                                                                     | Previously                        filed by our company as part of our Annual Report on Form                        10-K for the                        year ended December 31, 2002, as filed on March 31, 2003.  |
|                                  | (11)                                                                                                                                                                                                                                                                                                                                                     | Previously                        filed by our company as part of our Annual Report on Form                        10-K for the                        year ended December 31, 2003 asfiled on April 14, 2004.  |

----

**Signatures**

| **ENERGY                  EXPLORATION TECHNOLOGIES INC.****an                  Alberta corporation**                                                                                                                                                                                                                                                                                                                                                                                                       | **ENERGY                  EXPLORATION TECHNOLOGIES INC.****an                  Alberta corporation**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| By:    /s/   *George                  Liszicasz*                                   George                  Liszicasz,                   CEO,                  principal executive officer | By:                  /s/   Jarmila                  Manasek                                   * *                   Jarmila                  Manasek                   V.P.                  Finance, principal financial                  officer |

| **Signature**                                                                                    | **Title**                                                                                       | **Date**                                 |
|--------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|------------------------------------------|
|   */s/                  George Liszicasz*                                              |                                                                                            |                                     |
| George                  Liszicasz    */s/                  Brian Kohlhammer* | Chief                  Executive Officer, principal executive officer, and Director   | November                  14, 2005       |
| Brian                  Kohlhammer                                                 | Director                                                                                        | November                  14, 2005       |
| His                  Highness Sheikh Al Hassan Bin Ali Bin Rashid Al Nuaimi            | Director                                                                                        | November                  14, 2005  |
| Dennis                  Hunter  */s/                  Douglas Rowe*                    | Director                                                                                        | November                  14, 2005  |
| Douglas                  Rowe  */s/                  Robert Van Caneghan*              | Director                                                                                        | November                  14, 2005  |
| Robert                  Van Caneghan                                                   | Director                                                                                        | November                  14, 2005  |