----

----

----

| (Name      of small business issuer in its charter)                                                                                                                                                                                                                                                                                                                                                                                                   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Delaware                                                                                                                                                                                                                                                                                                                                                                                                                                              | 33-0464753 |
| (State      or other jurisdiction of incorporation or organization)                                                                                                                                                                                                                                                                                                                                                                                   | (IRS      Employer Identification  No.) |
|                  Suite      310, 605 – 1 Street SW,  Calgary, Alberta,      Canada                       T2P      3S9                                                                                                         |
| (Address      of principal executive      offices)                                                              (Zip      Code) |
| (403)      777-9250                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| (Issuer’s      telephone number)Securities      registered under Section 12(b) of the Exchange Act:                                                                                                                                                                                                                                                                                                                                             |
| Title      of each class                                                                                                                                                                                                                                                                                                                                                                                                                              | Name      of each exchange on which registered |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                  | None |
| Securities      registered under Section 12(g) of the Exchange Act:                                                                                                                                                                                                                                                                                                                                                                                   |
| Common      Stock, par value $.001 per share                                                                                                                                                                                                                                                                                                                                                                                                     |
| (Title      of Each Class)                                                                                                                                                                                                                                                                                                                                                                                                                            |

----

----

----

|     |                                                                 | Page   |
|----------|----------------------------------------------------------------------|--------|
|     |                                                                 |   |
| Item 6.  | Management’s Discussion and Analysis or Plan of      Operation | 3      |
|     |                                                                 |   |
| Item 7.  | Financial Statements                                                 | 19     |
|     |                                                                 |   |
| Item 8A. | Controls and Procedures                                              | 20     |
|     |                                                                 |   |
| Item 13. | Exhibits                                                             | 20     |
|     |                                                                 |   |

----

Item6.   Management’s Discussion and Analysis or Plan ofOperation

----

----

----

----

----

----

| ·   | the      statements in this Report regarding our plans and objectives relating to      our future operations, |
|--------------------|---------------------------------------------------------------------------------------------------------------|

| ·   | plans      and objectives regarding the exploration, development and production      activities conducted on the exploration blocks in India in which we have      interests, |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | plans      regarding drilling activities intended to be conducted through the      ventures in which we are a participant, the success of those drilling      activities and our ability and the ability of the ventures to complete any      wells on the exploration blocks, to develop reserves of hydrocarbons in      commercially marketable quantities, to establish facilities for the      collection, distribution and marketing of hydrocarbons, to produce oil and      natural gas in commercial quantities and to realize revenues from the      sales of those hydrocarbons, |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | our      ability to maintain compliance with the terms and conditions of our PSCs,      including the related work commitments, to obtain consents, waivers and      extensions from the GOI as and when required, and our ability to fund      those work commitments, |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | our      plans and objectives to join with others or to directly seek to enter into      or acquire interests in additional PSCs with the GOI and      others, |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | our      assumptions, plans and expectations regarding our future capital      requirements, |
|--------------------|----------------------------------------------------------------------------------------------|

| ·   | our      plans and intentions regarding our plans to raise additional      capital, |
|--------------------|-------------------------------------------------------------------------------------|

| ·   | the      costs and expenses to be incurred in conducting exploration, well      drilling, development and production activities and the adequacy of our      capital to meet our requirements for our present and anticipated levels of      activities are all forward-lookingstatements. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | We      cannot assure you that our assumptions or our business plans and      objectives discussed herein will prove to be accurate or be able to be      attained. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      cannot assure you that any commercially recoverable quantities of      hydrocarbon reserves will be discovered on the exploration blocks in which      we have an interest. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Our      ability to realize revenues cannot be assured.  Our ability to      successfully drill, test and complete producing wells cannot be      assured. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      cannot assure you that we will have available to us the capital required      to meet our plans and objectives at the times and in the amounts required      or we will have available to us the amounts we are required to fund under      the terms of the PSCs we are a partyto. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      cannot assure you that we will be successful in joining any further      ventures seeking to be granted PSCs by the GOI or that we will be      successful in acquiring interests in existing  ventures. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      cannot assure you that we will obtain all required consents, waivers and      extensions from the GOI as and when required to maintain compliance with      our PSCs and that we may not be adversely affected by any delays we may      experience in receiving those consents, waivers and      extensions. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      cannot assure you that the outcome of testing of one or more wells on the      exploration blocks under our PSCs will be satisfactory and result in a      commercially-productive wells or that any further wells drilled will have      commercially-successful results. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

| ·   | We      will experience failures to discover oil and gas in commercial      quantities; |
|--------------------|-----------------------------------------------------------------------------------------|

| ·   | There      are uncertainties as to the costs to be incurred in our exploratory      drilling activities, cost overruns are possible and we may encounter      mechanical difficulties and failures in completing  wells; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | There      are uncertain costs inherent in drilling into unknown formations, such as      over-pressured zones, high temperatures and tools lost in the hole;      and |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      may make changes in our drilling plans and locations as a result of prior      exploratory drilling. |
|--------------------|--------------------------------------------------------------------------------------------------------------|

----

----

----

| ·   | The      venture participants are required to complete certain minimum work      programs during the two or three phases of the terms of the      PSCs.  In the event the venture participants fail to fulfill any      of these minimum work programs, the parties to the venture must pay to the      GOI their proportionate share of the amount that would be required to      complete the minimum work program.  Accordingly, we could be      called upon to pay our proportionate share of the estimated costs of any      incomplete work programs.  At April 13, 2007, we have failed to      complete phase one work programs under three of our PSCs within the time      periods agreed.  We have applied to the GOI for extensions of      these allotted time periods and are awaiting the GOI    response. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Until      such time as the GOI attains self sufficiency in the production of crude      oil and condensate and is able to meet its national demand, the parties to      the venture are required to sell in the Indian domestic market their      entitlement under the PSCs to crude oil and condensate produced from the      exploration blocks.  In addition, the Indian domestic market has      the first call on natural gas produced from the exploration blocks and the      discovery and production of natural gas must be made in the context of the      government’s policy of utilization of natural gas and take into account      the objectives of the government to develop its resources in the most      efficient manner and promote conservation      measures.  Accordingly, this provision could interfere with our      ability to realize the maximum price for our share of production of      hydrocarbons; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The      parties to each agreement that are not Indian companies, which includes      us, are required to negotiate technical assistance agreements with the GOI      or its nominee whereby such foreign company can render technical      assistance and make available commercially available technical information      of a proprietary nature for use in India by the government or its nominee,      subject, among other things, to confidentiality      restrictions.  Although not intended, this could increase each      venture’s and our cost of operations;and |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The      parties to each venture are required to give preference, including the use      of tender procedures, to the purchase and use of goods manufactured,      produced or supplied in India provided that such goods are available on      equal or better terms than imported goods, and to employ Indian      subcontractors having the required skills insofar as their services are      available on comparable standards and at competitive prices and      terms.  Although not intended, this could increase the ventures      and our cost of operations. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | political      conditions and civil unrest in oil producing regions, including the Middle      East and elsewhere; |
|--------------------|--------------------------------------------------------------------------------------------------------------------|

| ·   | the      domestic and foreign supply of oil andgas; |
|--------------------|-----------------------------------------------------|

| ·   | quotas      imposed by the Organization of Petroleum Exporting Countries upon its      members; |
|--------------------|-------------------------------------------------------------------------------------------------|

| ·   | the      level of consumer demand; |
|--------------------|------------------------------------|

| ·   | weather      conditions; |
|--------------------|--------------------------|

| ·   | domestic      and foreign government regulations; |
|--------------------|---------------------------------------------------|

| ·   | the      price and availability of alternativefuels; |
|--------------------|------------------------------------------------------|

| ·   | overall      economic conditions; and |
|--------------------|---------------------------------------|

| ·   | international      political conditions. |
|--------------------|------------------------------------------|

| ·   | the      capacity and availability of oil and gas gathering systems and      pipelines; |
|--------------------|-----------------------------------------------------------------------------------------|

| ·   | the      ability to produce oil and gas in commercial quantities and to enhance and      maintain production from existing wells and wells proposed to be      drilled; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the      proximity of future hydrocarbon discoveries to oil and gas transmission      facilities and processing equipment (as well as the capacity of such      facilities); |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the      effect of governmental regulation of production and transportation      (including regulations relating to prices, taxes, royalties, land tenure,      allowable production, importing and exporting of oil and condensate and      matters associated with the protection of the  environment); |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the      imposition of trade sanctions or embargoes by other    countries; |
|--------------------|----------------------------------------------------------------------------|

| ·   | the      availability and frequency of deliveryvessels; |
|--------------------|---------------------------------------------------------|

| ·   | changes      in supply due to drilling byothers; |
|--------------------|--------------------------------------------------|

----

| ·   | the      availability of drilling rigs and qualified personnel;  and |
|--------------------|----------------------------------------------------------------------|

| ·   | changes      in demand. |
|--------------------|-------------------------|

----

Item7.   Financial Statements

----

Item8A.  Controls and Procedures

Item13.   Exhibits

| Exhibit | Description                                                                                                                                                                                                    |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1     | Certificate      of Incorporation of the Registrant, as amended.      (1)                                                                                                                                      |
| 3.2     | Bylaws      of the Registrant, as amended. (4)                                                                                                                                                                 |
| 3.3     | Certificate      of Amendment filed with the State of Delaware on November 25, 1998. (2)                                                                                                                       |
| 3.4     | Certificate      of Amendment filed with the State of Delaware on December 4, 1998. (2)                                                                                                                        |
| 3.5     | Certificate      of Amendment filed with the State of Delaware on March 18, 2003. (5)                                                                                                                          |
| 3.6     | Certificate      of Amendment filed with the State of Delaware on January 8, 2004. (5)                                                                                                                         |
| 4.1     | Specimen      stock certificate of the Registrant. (5)                                                                                                                                                         |
| 10.1    | Restated      1993 Stock Incentive Plan. (1)                                                                                                                                                                   |
| 10.2    | 1994      Directors Stock Option Plan. (1)                                                                                                                                                                     |
| 10.3    | 1994      Stock Option Plan. (1)                                                                                                                                                                               |
| 10.4    | 1993      Stock Incentive Plan. (1)                                                                                                                                                                            |
| 10.5    | 1998      Stock Incentive Plan. (2)                                                                                                                                                                            |
| 10.6    | Stock      Purchase Agreement dated April 4, 2003 by and among Suite101.com, Inc.,      Jean Paul Roy and GeoGlobal Resources (India) Inc. (3)                                                                 |
| 10.7    | Amendment      dated August 29, 2003 to Stock Purchase Agreement dated April 4, 2003.      (4)                                                                                                                 |
| 10.8    | Technical      Services Agreement dated August 29, 2003 between Suite101.com, Inc. and      Roy Group (Barbados) Inc. (4)                                                                                      |
| 10.8.1  | Amendment      to Technical Services Agreement dated January 31, 2006 between GeoGlobal      Resources Inc. and Roy Group (Barbados) Inc. (8)                                                                  |
| 10.9    | Participating      Interest Agreement dated March 27, 2003 between GeoGlobal Resources      (India) Inc. and Roy Group (Mauritius) Inc. (4)                                                                    |
| 10.10   | Escrow      Agreement dated August 29, 2003 among Registrant, Jean Paul Roy and      Computershare Trust Company of Canada. (4)                                                                                |
| 10.11   | Promissory      Note dated August 29, 2003 payable to Jean Paul Roy. (4)                                                                                                                                       |
| 10.12   | Production      Sharing Contract dated February 4, 2003, among The Government of India,      Gujarat State Petroleum Corporation Limited, Jubilant Enpro Limited and      GeoGlobal Resources (India) Inc. (6) |

----

| 10.13  | Production      Sharing Contract dated February 6, 2004 among The Government of India,      Gujarat State Petroleum Corporation Limited, Jubilant Enpro Private      Limited and GeoGlobal Resources (Barbados) Inc. (6)                                       |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.14  | Production      Sharing Contract dated February 6, 2004 among The Government of India,      Gujarat State Petroleum Corporation Limited, Jubilant Enpro Private      Limited, Prize Petroleum Company Limited and GeoGlobal Resources      (Barbados) Inc. (6) |
| 10.15  | Carried      Interest Agreement dated August 27, 2002 between Gujarat State Petroleum      Corporation Limited and GeoGlobal Resources (India) Inc. (5)                                                                                                        |
| 10.16  | Agency      Agreement dated September 9, 2005 between the Company and Jones, Gable      & Company Limited.      (7)                                                                                                                                        |
| 10.17  | Form      of Subscription Agreement entered into by subscribers relating to offers      and sales of Units by Jones, Gable & Company Limited.      (7)                                                                                                     |
|   | Form      of Subscription Agreement with respect to sales of an aggregate of      1,000,000 of the Units.      (7)                                                                                                                                             |
| 10.18  | Registration      Rights Agreement dated September 9, 2005 between the Company and      Jones, Gable & Company Limited.      (7)                                                                                                                      |
| 10.19  | Production      Sharing Contract dated September 23, 2005, between the Government of      India and GeoGlobal Resources (Barbados) Inc.      (7)                                                                                                          |
| 10.20  | Production      Sharing Contract dated September 23, 2005, between the Government of      India, Gujarat State Petroleum Corporation Limited, GAIL (India) Ltd.,      Jubilant Capital Pvt. Ltd. and GeoGlobal Resources (Barbados) Inc.      (7)         |
| 10.21  | Production      Sharing Contract dated March 2, 2007, between the Government of India, Oil      India Limited and GeoGlobal Resources (Barbados) Inc.      (9)                                                                                                 |
| 10.22  | Production      Sharing Contract dated March 2, 2007, between the Government of India, Oil      India Limited and GeoGlobal Resources (Barbados) Inc.      (9)                                                                                                 |
| 10.23  | Production      Sharing Contract dated March 2, 2007, between the Government of India, Oil      India Limited, Hindustan Petroleum Corpn. Ltd. and GeoGlobal Resources      (Barbados) Inc.      (9)                                                           |
| 10.24  | Production      Sharing Contract dated March 2, 2007, between the Government of India and      GeoGlobal Resources (Barbados) Inc.      (9)                                                                                                                    |
|   |                                                                                                                                                                                                                                                           |
| 14     | Code      of Ethics. (5)                                                                                                                                                                                                                                       |
|   |                                                                                                                                                                                                                                                           |

| 21     | Subsidiaries      of the Registrant:                                                                              |
|--------|-------------------------------------------------------------------------------------------------------------------|
|   | Name                                                                                                              | State      or Jurisdiction of Incorporation |
|   | GeoGlobal      Resources (India) Inc.                                                                             | Barbados |
|   | GeoGlobal      Resources (Canada) Inc.                                                                            | Alberta |
|   | GeoGlobal      Resources (Barbados) Inc.                                                                          | Barbados |
|   |                                                                                                              |
| 23     | Consent      of experts and counsel:                                                                              |
| 23.1   | Consent of Ernst & Young LLP. (10)                                                                            |
| 31.1   | Certification of President and Chief Executive Officer      Pursuant to Rule 13a-14(a). (10)                      |
| 31.2   | Certification of Chief Financial Officer Pursuant to      Rule 13a-14(a). (10)                                    |
| 32.1   | Certification of President and Chief Executive Officer      Pursuant to Section 1350 (furnished, not filed). (10) |
| 32.2   | Certification of Chief Financial Officer Pursuant to      Section 1350 (furnished, not filed). (10)               |

| (1) | Filed      as an Exhibit to Neuro Navigational Corporation Form 10-KSB No. 0-25136      dated September 30, 1994. |
|-----|-------------------------------------------------------------------------------------------------------------------|

| (2) | Filed      as an Exhibit to our Current Report on Form 8-K dated December 10,      1998. |
|-----|------------------------------------------------------------------------------------------|

| (3) | Filed      as exhibit 10.1 to our Quarterly Report on Form 10-QSB for the quarter      ended March 31, 2003. |
|-----|--------------------------------------------------------------------------------------------------------------|

| (4) | Filed      as an exhibit to our Current Report on Form 8-K for August 29,      2003. |
|-----|--------------------------------------------------------------------------------------|

| (5) | Filed      as an Exhibit to our Form 10-KSB dated April 1,  2004. |
|-----|-------------------------------------------------------------------|

| (6) | Filed      as an Exhibit to our Form 10-KSB/A dated April 28,  2004. |
|-----|----------------------------------------------------------------------|

| (7) | Filed      as an Exhibit to our Quarterly Report on Form 10-QSB for the quarter ended      September 30, 2005. |
|-----|----------------------------------------------------------------------------------------------------------------|

| (8) | Filed      as an Exhibit to our Current Report on Form 8-K dated January 31,      2006. |
|-----|-----------------------------------------------------------------------------------------|

| (9) | To      be filed as an Exhibit to our Quarterly Report on Form 10Q for the quarter      ending March 31, 2007. |
|-----|----------------------------------------------------------------------------------------------------------------|

|   | (10)             Filed herewith. |
|--------|---------------------------------------------------------------------|

----

----

| Report      of Independent Registered Public Accounting Firm |                                                                  | F-3    |
|--------------------------------------------------------------|-----------------------------------------------------------------------|--------|
|                                                         |                                                                  |   |
| Financial      Statements                               |                                                                  |   |
|                                                         | Consolidated Balance Sheets                                           |   | F-4 |
|                                                         | Consolidated Statements of Operations                                 |   | F-5 |
|                                                         | Consolidated Statements of Changes in Stockholders’      Equity |   | F-6 |
|                                                         | Consolidated Statements of Cash Flows                                 |   | F-7 |
|                                                         | Notes to the Consolidated Financial      Statements                   |   | F-8      to F-36 |

----

----

| GEOGLOBAL      RESOURCES INC.(a      development stage enterprise)CONSOLIDATED BALANCE SHEETS                                                                |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                         |   | December      31, 2006US      $ |   |   | December      31, 2005US      $ |   |
|                                                                                                                                                         |   | Restatednote      6c |   |   | Restatednote      6c |   |
| Assets                                                                                                                                                       |   |   |   |   |   |   |
|    Current                                                                                                                                    |   |   |   |   |   |   |
| Cash      and cash equivalents (note 2i)                                                                                                                     |   |   | 32,362,978 |   |   |   | 36,037,388 |   |
| Accounts      receivable                                                                                                                                     |   |   | 202,821 |   |   |   | 139,035 |   |
| Prepaids      and deposits                                                                                                                                   |   |   | 31,232 |   |   |   | 5,718 |   |
| Cash      call receivable                                                                                                                                    |   |   | -- |   |   |   | 49,947 |   |
|                                                                                                                                                         |   |   | 32,597,031 |   |   |   | 36,232,088 |   |
|                                                                                                                                                         |   |   |   |   |   |   |   |   |
| Restricted      cash (note11a)                                                                                                                               |   |   | 3,590,769 |   |   |   | 392,485 |   |
| Property      and equipment (note 3)                                                                                                                         |   |   | 183,427 |   |   |   | 89,826 |   |
| Oil      and gas interests, not subject to depletion (note 4)                                                                                                |   |   | 12,121,334 |   |   |   | 3,957,723 |   |
|                                                                                                                                                         |   |   |   |   |   |   |   |   |
|                                                                                                                                                         |   |   | 48,492,561 |   |   |   | 40,672,122 |   |
|                                                                                                                                                         |   |   |   |   |   |   |   |   |
| Liabilities                                                                                                                                                  |   |   |   |   |   |   |   |   |
| Current                                                                                                                                                      |   |   |   |   |   |   |   |   |
| Accounts      payable                                                                                                                                        |   |   | 1,888,103 |   |   |   | 159,145 |   |
| Accrued      liabilities                                                                                                                                     |   |   | 33,487 |   |   |   | 43,500 |   |
| Due      to related companies (notes 8c, 8d and 8e)                                                                                                          |   |   | 33,605 |   |   |   | 244,452 |   |
|                                                                                                                                                         |   |   | 1,955,195 |   |   |   | 447,097 |   |
| Stockholders'      Equity (note 5)                                                                                                                           |   |   |   |   |   |   |   |   |
| Capital      stock                                                                                                                                           |   |   |   |   |   |   |   |   |
| Authorized                                                                                                                                                   |   |   |   |   |   |   |   |   |
| 100,000,000      common shares with a par value of US$0.001 each                                                                                             |   |   |   |   |   |   |   |   |
| 1,000,000      preferred shares with a par value of US$0.01 each                                                                                             |   |   |   |   |   |   |   |   |
| Issued                                                                                                                                                       |   |   |   |   |   |   |   |   |
| 66,208,255      common shares (December 31, 2005 – 62,954,255)                                                                                         |   |   | 51,617 |   |   |   | 48,361 |   |
| Additional      paid-in capital                                                                                                                              |   |   | 52,900,900 |   |   |   | 45,043,012 |   |
| Deficit      accumulated during the development stage                                                                                                        |   |   | (6,415,151 | ) |   |   | (4,866,348 | ) |
|                                                                                                                                                         |   |   | 46,537,366 |   |   |   | 40,225,025 |   |
|                                                                                                                                                         |   |   |   |   |   |   |   |   |
|                                                                                                                                                         |   |   | 48,492,561 |   |   |   | 40,672,122 |   |
| See      Commitments, Contingencies and Guarantees (note 11)The      accompanying notes are an integral part of these Consolidated Financial      Statements |   |

----

| GEOGLOBAL      RESOURCES INC.(a      development stage enterprise)CONSOLIDATED STATEMENTS OF OPERATIONS |   |
|---------------------------------------------------------------------------------------------------------|--------|
|                                                                                                    |   | Year      endedDec      31, 2006US      $ |   |   | Year      endedDec      31, 2005US      $ |   |   | Year      endedDec      31, 2004US      $ |   |   | Period      fromInception,Aug      21, 2002to      Dec 31, 2006US      $ |   |
|                                                                                                    |   | Restatednote      6c |   |   | Restatednote      6c |   |   | Restatednote      6c |   |   | Restatednote      6c |   |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses      (notes 8c, 8d, 8e and 6b)                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| General      and administrative                                                                         |   |   | 1,890,926 |   |   |   | 495,326 |   |   |   | 451,788 |   |   |   | 2,995,642 |   |
| Consulting      fees                                                                                    |   |   | 1,104,106 |   |   |   | 2,947,126 |   |   |   | 541,617 |   |   |   | 4,803,802 |   |
| Professional      fees                                                                                  |   |   | 251,261 |   |   |   | 201,298 |   |   |   | 161,381 |   |   |   | 752,676 |   |
| Depreciation                                                                                            |   |   | 49,323 |   |   |   | 49,531 |   |   |   | 61,308 |   |   |   | 211,310 |   |
|                                                                                                    |   |   | 3,295,616 |   |   |   | 3,693,281 |   |   |   | 1,216,094 |   |   |   | 8,763,430 |   |
| Other      expenses (income)                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consulting      fees recovered                                                                          |   |   | -- |   |   |   | (12,950 | ) |   |   | (14,300 | ) |   |   | (66,025 | ) |
| Equipment      costs recovered                                                                          |   |   | -- |   |   |   | (12,950 | ) |   |   | (2,200 | ) |   |   | (19,395 | ) |
| Gain      on sale of equipment                                                                          |   |   | -- |   |   |   | (42,228 | ) |   |   | -- |   |   |   | (42,228 | ) |
| Foreign      exchange (gain) loss                                                                       |   |   | 4,737 |   |   |   | (319 | ) |   |   | 3,495 |   |   |   | 26,547 |   |
| Interest      income                                                                                    |   |   | (1,751,550 | ) |   |   | (462,174 | ) |   |   | (31,591 | ) |   |   | (2,247,178 | ) |
|                                                                                                    |   |   | (1,746,813 | ) |   |   | (530,621 | ) |   |   | (44,596 | ) |   |   | (2,348,279 | ) |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      loss and comprehensive loss forthe      period (note 9)                                        |   |   | (1,548,803 | ) |   |   | (3,162,660 | ) |   |   | (1,171,498 | ) |   |   | (6,415,151 | ) |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      loss per share–      basic and diluted (note 5f)                                         |   |   | (0.03 | ) |   |   | (0.06 | ) |   |   | (0.03 | ) |   |   |   |   |

----

| GEOGLOBAL      RESOURCES INC.(a      development stage enterprise)CONSOLIDATED STATEMENTS OF STOCKHOLDERS'    EQUITY                    |   |
|-----------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                    |   | Capital StockUS      $ |   |   | Additionalpaid-in      capitalUS      $ |   |   | AccumulatedDeficitUS      $ |   |   | Stockholders'EquityUS      $ |   |
|                                                                                                                                    |   |   |   |   | Restatednote      6c |   |   | Restatednote      6c |   |   | Restatednote      6c |   |
|                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      shares issued on incorporation on Aug 21, 2002                                                                              |   |   | 64 |   |   |   | -- |   |   |   | -- |   |   |   | 64 |   |
|                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      loss and comprehensive loss for the period                                                                                     |   |   | -- |   |   |   | -- |   |   |   | (13,813 | ) |   |   | (13,813 | ) |
| Balance      at December 31, 2002                                                                                                       |   |   | 64 |   |   |   | -- |   |   |   | (13,813 | ) |   |   | (13,749 | ) |
|                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      shares issued during the year                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| On      acquisition (note 7)                                                                                                            |   |   | 34,000 |   |   |   | 1,072,960 |   |   |   | -- |   |   |   | 1,106,960 |   |
| Options      exercised for cash                                                                                                         |   |   | 397 |   |   |   | 101,253 |   |   |   | -- |   |   |   | 101,650 |   |
| December      2003 private placement financing (note 5c)                                                                                |   |   | 6,000 |   |   |   | 5,994,000 |   |   |   | -- |   |   |   | 6,000,000 |   |
| Share      issuance costs on private placement                                                                                          |   |   | -- |   |   |   | (550,175 | ) |   |   | -- |   |   |   | (550,175 | ) |
| Stock-based      compensation                                                                                                           |   |   | -- |   |   |   | 62,913 |   |   |   | -- |   |   |   | 62,913 |   |
| Net      loss and comprehensive loss for the year                                                                                       |   |   | -- |   |   |   | -- |   |   |   | (518,377 | ) |   |   | (518,377 | ) |
| Balance      at December 31, 2003                                                                                                       |   |   | 40,461 |   |   |   | 6,680,951 |   |   |   | (532,190 | ) |   |   | 6,189,222 |   |
|                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      shares issued during the year                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Options      exercised for cash                                                                                                         |   |   | 115 |   |   |   | 154,785 |   |   |   | -- |   |   |   | 154,900 |   |
| Broker      Warrants exercised for cash (note 5c)                                                                                       |   |   | 39 |   |   |   | 58,611 |   |   |   | -- |   |   |   | 58,650 |   |
| Stock-based      compensation                                                                                                           |   |   | -- |   |   |   | 350,255 |   |   |   | -- |   |   |   | 350,255 |   |
| Net      loss and comprehensive loss for the year                                                                                       |   |   | -- |   |   |   | -- |   |   |   | (1,171,498 | ) |   |   | (1,171,498 | ) |
| Balance      at December 31, 2004                                                                                                       |   |   | 40,615 |   |   |   | 7,244,602 |   |   |   | (1,703,688 | ) |   |   | 5,581,529 |   |
|                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      shares issued during the year                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Options      exercised for cash (note 5e(i))                                                                                            |   |   | 739 |   |   |   | 1,004,647 |   |   |   | -- |   |   |   | 1,005,386 |   |
| 2003      Purchase Warrants exercised for cash (note 5d(i))                                                                             |   |   | 2,214 |   |   |   | 5,534,036 |   |   |   | -- |   |   |   | 5,536,250 |   |
| Broker      Warrants exercised for cash (note 5c)                                                                                       |   |   | 541 |   |   |   | 810,809 |   |   |   | -- |   |   |   | 811,350 |   |
| September      2005 private placement financing (note 5b)                                                                               |   |   | 4,252 |   |   |   | 27,636,348 |   |   |   | -- |   |   |   | 27,640,600 |   |
| Share      issuance costs on private placement (note 5b)                                                                                |   |   | -- |   |   |   | (1,541,686 | ) |   |   | -- |   |   |   | (1,541,686 | ) |
| Stock-based      compensation                                                                                                           |   |   | -- |   |   |   | 4,354,256 |   |   |   | -- |   |   |   | 4,354,256 |   |
| Net      loss and comprehensive loss for the year                                                                                       |   |   | -- |   |   |   | -- |   |   |   | (3,162,660 | ) |   |   | (3,162,660 | ) |
| Balance      at December 31, 2005                                                                                                       |   |   | 48,361 |   |   |   | 45,043,012 |   |   |   | (4,866,348 | ) |   |   | 40,225,025 |   |
|                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      shares issued during the year                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Options      exercised for cash (note 5e(i))                                                                                            |   |   | 2,285 |   |   |   | 2,706,895 |   |   |   | -- |   |   |   | 2,709,180 |   |
| Options      exercised for notes receivable (note 6f)                                                                                   |   |   | 185 |   |   |   | 249,525 |   |   |   | -- |   |   |   | 249,710 |   |
| 2003      Purchase Warrants exercised for cash (note 5d(i))                                                                             |   |   | 786 |   |   |   | 1,962,964 |   |   |   | -- |   |   |   | 1,963,750 |   |
| Share      issuance costs                                                                                                               |   |   | -- |   |   |   | (74,010 | ) |   |   | -- |   |   |   | (74,010 | ) |
| Stock-based      compensation (note 6b)                                                                                                 |   |   | -- |   |   |   | 3,012,514 |   |   |   | -- |   |   |   | 3,012,514 |   |
| Net      loss and comprehensive loss for the year                                                                                       |   |   | -- |   |   |   | -- |   |   |   | (1,548,803 | ) |   |   | (1,548,803 | ) |
|  Balance      at December 31, 2006                                                                                                 |   |   | 51,617 |   |   |   | 52,900,900 |   |   |   | (6,415,151 | ) |   |   | 46,537,366 |   |
| See      note 5 for further informationThe      accompanying notes are an integral part of these Consolidated Financial      Statements |   |

----

| GEOGLOBAL      RESOURCES INC.(a      development stage enterprise)CONSOLIDATED STATEMENTS OF CASH FLOWS |   |
|---------------------------------------------------------------------------------------------------------|--------|
|                                                                                                    |   | Year      endedDec      31, 2006US      $ |   |   | Year      endedDec      31, 2005US      $ |   |   | Year      endedDec      31, 2004US      $ |   |   | Period      fromInception,Aug      21, 2002to      Dec 31, 2006US      $ |   |
|                                                                                                    |   | Restatednote      6c |   |   | Restatednote      6c |   |   | Restatednote      6c |   |   | Restatednote      6c |   |
| Cash      flows provided by (used in) operating activities:                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      loss                                                                                           |   |   | (1,548,803 | ) |   |   | (3,162,660 | ) |   |   | (1,171,498 | ) |   |   | (6,415,151 | ) |
| Adjustments      to reconcile net loss tonet      cash used in operating activities:                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation                                                                                            |   |   | 49,323 |   |   |   | 49,531 |   |   |   | 61,308 |   |   |   | 211,310 |   |
| Gain      on sale of equipment                                                                          |   |   | -- |   |   |   | (42,228 | ) |   |   | -- |   |   |   | (42,228 | ) |
| Stock-based      compensation (note 6b)                                                                 |   |   | 1,588,289 |   |   |   | 2,681,680 |   |   |   | 304,002 |   |   |   | 4,614,653 |   |
| Changes      in operating assets and liabilities:                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Accounts      receivable                                                                                |   |   | (63,786 | ) |   |   | 42,202 |   |   |   | (99,750 | ) |   |   | (127,821 | ) |
| Prepaids      and deposits                                                                              |   |   | (25,514 | ) |   |   | (5,718 | ) |   |   | -- |   |   |   | (31,232 | ) |
| Accounts      payable                                                                                   |   |   | (23,720 | ) |   |   | 24,307 |   |   |   | (147,060 | ) |   |   | 34,651 |   |
| Accrued      liabilities                                                                                |   |   | (10,013 | ) |   |   | 22,500 |   |   |   | 4,600 |   |   |   | 33,487 |   |
| Due      to related companies                                                                           |   |   | (210,847 | ) |   |   | 224,828 |   |   |   | (27,239 | ) |   |   | (8,151 | ) |
|                                                                                                    |   |   | (245,071 | ) |   |   | (165,558 | ) |   |   | (1,075,637 | ) |   |   | (1,730,482 | ) |
| Cash      flows provided by (used in) investing activities:                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Oil      and gas interests                                                                              |   |   | (6,739,386 | ) |   |   | (1,578,124 | ) |   |   | (460,016 | ) |   |   | (8,956,049 | ) |
| Property      and equipment                                                                             |   |   | (142,924 | ) |   |   | (36,876 | ) |   |   | (87,341 | ) |   |   | (435,309 | ) |
| Proceeds      on sale of equipment                                                                      |   |   | -- |   |   |   | 82,800 |   |   |   | -- |   |   |   | 82,800 |   |
| Cash      acquired on acquisition (note 7)                                                              |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | 3,034,666 |   |
| Restricted      cash (note 11a)                                                                         |   |   | (3,198,284 | ) |   |   | (185,689 | ) |   |   | (206,796 | ) |   |   | (3,590,769 | ) |
| Changes      in investing assets and liabilities:                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash      call receivable                                                                               |   |   | 49,947 |   |   |   | (22,436 | ) |   |   | (27,511 | ) |   |   | -- |   |
| Accounts      payable                                                                                   |   |   | 1,763,478 |   |   |   | 94,415 |   |   |   | -- |   |   |   | 1,804,444 |   |
| Accrued      liabilities                                                                                |   |   | -- |   |   |   | (33,442 | ) |   |   | 33,442 |   |   |   | -- |   |
|                                                                                                    |   |   | (8,267,169 | ) |   |   | (1,679,352 | ) |   |   | (748,222 | ) |   |   | (8,060,217 | ) |
| Cash      flows provided by (used in) financing activities:                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds      from issuance of common shares                                                            |   |   | 4,922,640 |   |   |   | 34,993,586 |   |   |   | 213,550 |   |   |   | 46,231,490 |   |
| Share      issuance costs                                                                               |   |   | (74,010 | ) |   |   | (1,541,686 | ) |   |   | -- |   |   |   | (2,165,871 | ) |
| Changes      in financing liabilities:                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Note      payable (note 8a)                                                                             |   |   | -- |   |   |   | -- |   |   |   | (1,000,000 | ) |   |   | (2,000,000 | ) |
| Accounts      payable                                                                                   |   |   | (10,800 | ) |   |   | 10,800 |   |   |   | -- |   |   |   | 61,078 |   |
| Due      to shareholder                                                                                 |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |
| Due      to related companies                                                                           |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | 26,980 |   |
|                                                                                                    |   |   | 4,837,830 |   |   |   | 33,462,700 |   |   |   | (786,450 | ) |   |   | 42,153,677 |   |
|  Net      increase (decrease) in cash and cash equivalents                                         |   |   | (3,674,410 | ) |   |   | 31,617,790 |   |   |   | (2,610,309 | ) |   |   | 32,362,978 |   |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash      and cash equivalents, beginning of period                                                     |   |   | 36,037,388 |   |   |   | 4,419,598 |   |   |   | 7,029,907 |   |   |   | -- |   |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash      and cash equivalents, end of period                                                           |   |   | 32,362,978 |   |   |   | 36,037,388 |   |   |   | 4,419,598 |   |   |   | 32,362,978 |   |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash      and cash equivalents                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current      bank accounts                                                                              |   |   | 316,329 |   |   |   | 127,803 |   |   |   | 90,670 |   |   |   | 316,329 |   |
| Term      deposits                                                                                      |   |   | 32,046,649 |   |   |   | 35,909,585 |   |   |   | 4,328,928 |   |   |   | 32,046,649 |   |
|                                                                                                    |   |   | 32,362,978 |   |   |   | 36,037,388 |   |   |   | 4,419,598 |   |   |   | 32,362,978 |   |
|  Cash      taxes paid during the period                                                            |   |   | 17,775 |   |   |   | 15,500 |   |   |   | 2,750 |   |   |   | 39,463 |   |
| The      accompanying notes are an integral part of these Consolidated Financial      Statements        |   |

----

1.         Nature ofOperations

----

| i)   | Capitalized      costs |
|----------------|------------------------|

| iv)   |           Asset retirement obligations |
|-----------------|------------------------------------------------------------|

----

|   | d) | Joint      operations |
|--------|----|-----------------------|

|   | Net      loss per share is calculated based upon the weighted-average number of      shares outstanding during the period.  The treasury stock method      is used to determine the dilutive effect of the stock      options.  The treasury stock method assumes any proceeds      obtained upon exercise of options would be used to purchase common shares      at the average market price during the period.  There are no      differences between net loss and the weighted-average number of shares      used in the calculation of the basic net loss per share and those used in      the calculation of diluted net loss per share as the effect of the options      and warrants on the diluted net loss per share calculations is      anti-dilutive for all periodspresented. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Comprehensive      loss includes all changes in equity except those resulting from      investments made by owners and distributions to      owners.  Comprehensive loss consists only of net loss for all      periods presented. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | g) | Use      of estimates |
|--------|----|-----------------------|

|   | The      preparation of the consolidated financial statements in accordance with      accounting principles generally accepted in the United States requires      management to make estimates and assumptions that affect the reported      amounts of assets and liabilities at the date of the consolidated      financial statements and the reported amounts of revenues and expenses      during the reporting period.  Actual results may differ from      these estimated amounts. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | h) | Financial      instruments |
|--------|----|----------------------------|

|   | The      Company has estimated the fair value of its financial instruments which      include cash and cash equivalents, restricted cash, accounts receivable,      accounts payable and due to related companies.  The Company used      valuation methodologies and market information available as at period end      to determine that the carrying amounts of such financial instruments      approximate fair value in all cases.  It is management’s opinion      that the Company is not exposed to significant interest, currency or      credit risks arising from its financial  instruments. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Cash      and cash equivalents include cash on hand, balances with banks and      short-term deposits with original maturities of three months or less,      earning interest based upon the US prime rate.  Interest earned      during the year ended December 31, 2006 was US$1,751,550 (December 31,      2005 – US$462,174) which included US$1,744,697 (December 31, 2005 –      US$454,887) of interest earned on our cash and cash equivalents held in      term deposits representing an average rate of 4.81% (December 31, 2005 –      2.57%). |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Company translates integrated foreign operations into the functional      currency of the parent.  Monetary assets and liabilities      denominated in foreign currencies are translated into U.S. dollars at      rates of exchange in effect at the date of the balance      sheet.  Non-monetary items are translated at the rate of      exchange in effect when the assets are acquired or obligations      incurred.  Revenues and expenses are translated at average rates      in effect during the period, with the exception of depreciation which is      translated at historic rates.  Exchange gains and losses are      charged to operations. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | The      Company follows the liability method of tax allocation.  Under      this method, assets and liabilities are determined based on differences      between the tax basis of an asset or liability and its carrying value      using enacted tax rates anticipated to apply in the periods when the      temporary differences are expected toreverse. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| l) | Stock-based      compensation plan |
|----|------------------------------------|

|                                       |   | December      31, 2006US$ |     |   | December      31, 2005US$ |   |
|--------------------------------------------|--------|---------------------------|----------|--------|---------------------------|--------|
|                                       |   |                      |     |   |                      |   |
| Computer      and office equipment         |   |                      | 324,419  |   |                      |   | 209,585 |   |
| Accumulated      depreciation              |   |                      | (169,082 | )      |                      |   | (119,759 | ) |
|                                       |   |                      | 155,337  |   |                      |   | 89,826 |   |
|                                       |   |                      |     |   |                      |   |   |   |
| Office      condominium deposit (note 13b) |   |                      | 28,090   |   |                      |   | -- |   |
|                                       |   |                      | 183,427  |   |                      |   | 89,826 |   |

----

|                                |   | December      31, 2006US$ |       |   | December      31, 2005US$ |   |
|-------------------------------------|--------|---------------------------|------------|--------|---------------------------|--------|
|                                |   | Restatednote      6c      |       |   | Restatednote      6c      |   |
| Exploration      – India      |   |                      |       |   |                      |   |
| Exploration      costs incurred in: |   |                      |       |   |                      |   |
| 2002                                |   |                      | 21,925     |   |                      |   | 21,925 |   |
| 2003                                |   |                      | 178,829    |   |                      |   | 178,829 |   |
| 2004                                |   |                      | 506,269    |   |                      |   | 506,269 |   |
| 2005                                |   |                      | 3,250,700  |   |                      |   | 3,250,700 |   |
|                                |   |                      | 3,957,723  |   |                      |   | 3,957,723 |   |
| 2006                                |   |                      | 8,163,611  |   |                      |   | -- |   |
|                                |   |                      | 12,121,334 |   |                      |   | 3,957,723 |   |

|   | c) | Carried      Interest Agreement |
|--------|----|---------------------------------|

|   | On      August 27, 2002, GeoGlobal entered into a CIA with GSPC, which grants the      Company a 10% Carried Interest (“CI”) (net 5% - see note 4d) in the KG      Offshore Block. The CIA provides that GSPC is responsible for GeoGlobal's      entire share of any and all costs incurred during the Exploration Phase      prior to the date of initial commercial  production. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | d) | Participating      Interest Agreement |
|--------|----|---------------------------------------|

|   | i) | Exploration      Block KG-OSN-2001/3 (also referred to as “KG Offshore    Block”) |
|--------|----|-----------------------------------------------------------------------------------------------|

|   | On      February 4, 2003, GeoGlobal, as to a 10% PI (net 5% - see note 4d)      together with its joint venture participants, Jubilant Enpro Limited      ("Enpro") and GSPC, as to their 10% and 80% PI respectively, entered into      a PSC with respect to the KG Offshore Block ("PSC-KG") with the      GOI.  The KG Offshore Block is located offshore on the east      coast of India in the Krishna Godavari Basin.  See also Carried      Interest Agreement note 4c. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      PSC-KG allows the joint venture participants to explore for petroleum and      natural gas over a 6.5 year period commencing March 12, 2003 on the KG      Offshore Block subject to the work commitment as outlined in note      11c. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | ii) | Exploration Block CB-ONN-2002/2      (also referred to as “MehsanaBlock”) |
|--------|-----|---------------------------------------------------------------------------------------|

|   | On      February 6, 2004, GeoGlobal as to its 10% PI, along with its joint venture      participants, Enpro and GSPC as to their 30% and 60% PI respectively,      entered into a PSC with respect to the Mehsana Block ("PSC-Mehsana") with      the GOI.  The Mehsana Block covers an area of approximately 125      square kilometers ("sq. kms.") in the Cambay Basin, located in the      province of Gujarat in NorthwestIndia. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      PSC-Mehsana allows the joint venture participants to explore for petroleum      and natural gas over a 6 year period commencing May 31, 2004 on the      Exploration Block subject to the work commitment as outlined in note      11b. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iii) | Exploration      Block CB-ONN-2002/3 (also      referred to as “Sanand/MiroliBlock”) |
|--------|------|--------------------------------------------------------------------------------------------------|

|   | On      February 6, 2004, GeoGlobal as to its 10% PI, along with its joint venture      participants, Enpro, GSPC, and Prize Petroleum Company Limited as to their      20%, 55% and 15% PI respectively, entered into a PSC with respect to the      Sanand/Miroli Block ("PSC-Sanand/Miroli") with the GOI.  The      Sanand/Miroli Block covers an area of approximately 285 sq. kms. in the      Cambay Basin, located in the province of Gujarat in Northwest      India. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      PSC-Sanand/Miroli allows the joint venture participants to explore for      petroleum and natural gas over a 6 year period commencing July 29, 2004 on      the Exploration Block subject to the work commitment as outlined in note      11b. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iv) | Exploration      Block CB-ONN-2003/2 (also      referred to as “AnkleshwarBlock”) |
|--------|-----|-----------------------------------------------------------------------------------------------|

|   | On      September 28, 2005, GeoGlobal as to its 10% PI, along with its joint      venture participants, Gail (India) Ltd., Jubilant Capital Pvt. Ltd. and      GSPC as to their 20%, 20% and 50% PI respectively, entered into a PSC with      respect to the Ankleshwar Block ("PSC-Ankleshwar") with the      GOI.  The Ankleshwar Block covers an area of approximately 448      sq. kms. in the Cambay Basin, located in the province of Gujarat in      Northwest India. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      PSC-Ankleshwar allows the joint venture participants to explore for      petroleum and natural gas over a 7 year period commencing April 1, 2006 on      the Exploration Block subject to the work commitment as outlined in note      11b. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | v) | Exploration      Block DS-ONN-2003/1 (also      referred to as “DS 03Block”) |
|--------|----|------------------------------------------------------------------------------------------|

|   | On      September 28, 2005, GeoGlobal as to its 100% PI entered into a PSC with      respect to the DS 03 Block ("PSC-DS") with the GOI.  The DS 03      Block covers an area of approximately 3,155 sq. kms. in the Deccan      Syneclise Basin, located in the northern portion of the State of      Maharashtra in West Central India. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      PSC-DS allows GeoGlobal to explore for petroleum and natural gas over a 7      year period commencing September 4, 2006 on the Exploration Block subject      to the work commitment as outlined in note11b. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                |   | Number      ofshares |       |   | Capital      stockUS      $ |   |    | Additionalpaid-in      capitalUS      $ |   |
|---------------------------------------------------------------------------------------------------------------------|--------|----------------------|------------|--------|-----------------------------|--------|---------|-----------------------------------------|--------|
|                                                                                                                |   |                 |       |   |                        |   |    | Restatednote      6c                    |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |
| Balance      at  December 31, 2002                                                                        |   |                 | 1,000      |   |                        |   | 64      |                                    |   |   | -- |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| 2003      Transactions                                                                                              |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Capital      stock of GeoGlobal at August 29, 2003                                                                  |   |                 | 14,656,687 |   |                        |   | 14,657  |                                    |   |   | 10,914,545 |   |
| Common      shares issued by GeoGlobal to acquire    GeoGlobal      India                       |   |                 | 34,000,000 |   |                        |   | 34,000  |                                    |   |   | 1,072,960 |   |
| Share      issuance costs on acquisition                                                                            |   |                 | --         |   |                        |   | --      |                                    |   |   | (66,850 | ) |
| Elimination      of GeoGlobal capital stock in recognition of    reverse      takeover (note 7) |   |                 | (1,000     | )      |                        |   | (14,657 | )                                       |   |   | (10,914,545 | ) |
| Options      exercised for cash                                                                                     |   |                 | 396,668    |   |                        |   | 397     |                                    |   |   | 101,253 |   |
| December      2003 private placement financing (note 5c)                                                            |   |                 | 6,000,000  |   |                        |   | 6,000   |                                    |   |   | 5,994,000 |   |
| Share      issuance costs on private placement                                                                      |   |                 | --         |   |                        |   | --      |                                    |   |   | (483,325 | ) |
| Stock-based      compensation (note 6b)                                                                             |   |                 | --         |   |                        |   | --      |                                    |   |   | 62,913 |   |
|                                                                                                                |   |                 | 55,052,355 |   |                        |   | 40,397  |                                    |   |   | 6,680,951 |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Balance      as at December 31, 2003                                                                                |   |                 | 55,053,355 |   |                        |   | 40,461  |                                    |   |   | 6,680,951 |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| 2004      Transactions                                                                                              |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Options      exercised for cash                                                                                     |   |                 | 115,000    |   |                        |   | 115     |                                    |   |   | 154,785 |   |
| Broker      Warrants exercised for cash (note 5c)                                                                   |   |                 | 39,100     |   |                        |   | 39      |                                    |   |   | 58,611 |   |
| Stock-based      compensation (note 6b)                                                                             |   |                 | --         |   |                        |   | --      |                                    |   |   | 350,255 |   |
|                                                                                                                |   |                 | 154,100    |   |                        |   | 154     |                                    |   |   | 563,651 |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Balance      as at December 31, 2004                                                                                |   |                 | 55,207,455 |   |                        |   | 40,615  |                                    |   |   | 7,244,602 |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| 2005      Transactions                                                                                              |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Options      exercised for cash (note 5e(i)                                                                         |   |                 | 739,000    |   |                        |   | 739     |                                    |   |   | 1,004,647 |   |
| 2003      Purchase Warrants exercised for cash (note 5d(i))                                                         |   |                 | 2,214,500  |   |                        |   | 2,214   |                                    |   |   | 5,534,036 |   |
| Broker      Warrants exercised for cash (note 5c)                                                                   |   |                 | 540,900    |   |                        |   | 541     |                                    |   |   | 810,809 |   |
| September      2005 private placement financing (note 5b)                                                           |   |                 | 4,252,400  |   |                        |   | 4,252   |                                    |   |   | 27,636,348 |   |
| Share      issuance costs on private placement (note 5b)                                                            |   |                 | --         |   |                        |   | --      |                                    |   |   | (1,541,686 | ) |
| Stock-based      compensation (note 6b)                                                                             |   |                 | --         |   |                        |   | --      |                                    |   |   | 4,354,256 |   |
|                                                                                                                |   |                 | 7,746,800  |   |                        |   | 7,746   |                                    |   |   | 37,798,410 |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Balance      as at December 31, 2005                                                                                |   |                 | 62,954,255 |   |                        |   | 48,361  |                                    |   |   | 45,043,012 |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| 2006      Transactions                                                                                              |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Options      exercised for cash (note 5e(i))                                                                        |   |                 | 2,284,000  |   |                        |   | 2,285   |                                    |   |   | 2,706,895 |   |
| Options      exercised for notes receivable (note 6f)                                                               |   |                 | 184,500    |   |                        |   | 185     |                                    |   |   | 249,525 |   |
| 2003      Purchase Warrants exercised for cash (note 5d(i))                                                         |   |                 | 785,500    |   |                        |   | 786     |                                    |   |   | 1,962,964 |   |
| Share      issuance costs                                                                                           |   |                 | --         |   |                        |   | --      |                                    |   |   | (74,010 | ) |
| Stock-based      compensation (note 6b)                                                                             |   |                 | --         |   |                        |   | --      |                                    |   |   | 3,012,514 |   |
|                                                                                                                |   |                 | 3,254,000  |   |                        |   | 3,256   |                                    |   |   | 7,857,888 |   |
|                                                                                                                |   |                 |       |   |                        |   |    |                                    |   |   |   |   |
| Balance      as at December 31, 2006                                                                                |   |                 | 66,208,255 |   |                        |   | 51,617  |                                    |   |   | 52,900,900 |   |

----

----

|   | As      at December 31, 2006, none of the 97,572 Compensation Option Warrants      have been issued as a result of the Compensation Options not being      exercised.  If the Compensation Options are exercised and the      Compensation Option Warrants issued, if exercised, would result in gross      proceeds of US$878,148. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | As      at December 31, 2006, none of the 195,144 Compensation Options were      exercised.  If fully exercised, the Compensation Options would      result in gross proceeds ofUS$1,268,436. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | Year      endedDec      31, 2006US      $ |      |       | Year      endedDec      31, 2005US      $ |                             |      | Year      endedDec      31, 2004US      $ |                             |   | Period      fromInceptionAug      21, 2002 to Dec 31, 2006US      $ |                                                             |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|-----------|------------|-------------------------------------------|----------------------------------|-----------|-------------------------------------------|----------------------------------|--------|---------------------------------------------------------------------|------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | Restatednote      6c                      |      |       | Restatednote      6c                      |                             |      | Restatednote      6c                      |                             |   | Restatednote      6c                                                |                                                             |
| Stock      based compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |
| Consolidated      Statements of Operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |
| General      and administrative                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                      | 1,048,477 |       |                                      |                             | --        |                                      |                             |   | --                                                                  |                                                             |   |   | 1,048,477 |   |
| Consulting      fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                      | 539,812   |       |                                      |                             | 2,681,680 |                                      |                             |   | 304,002                                                             |                                                             |   |   | 3,566,176 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                      | 1,588,289 |       |                                      |                             | 2,681,680 |                                      |                             |   | 304,002                                                             |                                                             |   |   | 4,614,653 |   |
| Consolidated      Balance Sheets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |   |   |   |   |
| Oil      and gas interests                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                      | 1,424,225 |       |                                      |                             | 1,672,576 |                                      |                             |   | 46,253                                                              |                                                             |   |   | 3,165,285 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                      | 3,012,514 |       |                                      |                             | 4,354,256 |                                      |                             |   | 350,255                                                             |                                                             |   |   | 7,779,938 |   |
| Prior      to the adoption of FAS 123(R), the Company used the intrinsic value method      of accounting for employee and director stock-based compensation. As      all options have been granted at exercise prices based on the market value      of the Company's common shares at the date of grant, no compensation cost      was recognized under the intrinsic value based method of      accounting. For the years ended December 31, 2005, 2004 and the      period from inception August 21, 2002 to December 31, 2005, had employee      compensation expense been determined based on the fair value at the grant      date consistent with FAS123(R) pro-forma oil and gas interests, net loss      and pro-forma net loss per share would have been as    follows: |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                      |      |       |                                      | Year      endedDec      31, 2005 |      |                                      | Year      endedDec      31, 2004 |   |                                                                | Period      from Inception,Aug      21, 2002 toDec      31, 2005 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                      |      |       |                                      | Restatednote      6c             |      |                                      | Restatednote      6c             |   |                                                                | Restatednote      6c                                             |   |
| Pro-forma      basis                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |   |
| Stock-based      compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |   |
| Oil      and gas interests                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                      |      | 337,113    |                                      |                             |      | 56,654                                    |                             |   |                                                                | 438,309                                                          |   |
| General      and administrative                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                                      |      | 458,766    |                                      |                             |      | 132,767                                   |                             |   |                                                                | 679,882                                                          |   |
| Oil      and gas interests                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |   |
| As      reported                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                      |      | 3,957,723  |                                      |                             |      | 707,023                                   |                             |   |                                                                | 3,957,723                                                        |   |
| Pro-forma                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                      |      | 4,396,032  |                                      |                             |      | 808,219                                   |                             |   |                                                                | 4,396,032                                                        |   |
| Net      loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |   |
| As      reported                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                      |      | (3,162,660 | )                                         |                             |      | (1,171,498                                | )                                |   |                                                                | (4,866,348                                                       | ) |
| Pro-forma                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                      |      | (3,621,426 | )                                         |                             |      | (1,304,265                                | )                                |   |                                                                | (5,546,230                                                       | ) |
| Net      loss per share - basic and diluted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                                      |      |       |                                      |                             |      |                                      |                             |   |                                                                |                                                             |   |
| As      reported                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                                      |      | (0.06      | )                                         |                             |      | (0.03                                     | )                                |   |                                                                |                                                             |   |
| Pro-forma                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                                      |      | (0.07      | )                                         |                             |      | (0.03                                     | )                                |   |                                                                |                                                             |   |

----

|                                     |  Year      endedDec      31, 2006 |  Year      endedDec      31, 2005 |  Year      endedDec      31, 2004 |
|------------------------------------------|----------------------------------------|----------------------------------------|----------------------------------------|
|                                     | Restatednote      6c                   | Restatednote      6c                   |                                   |
| Black-Scholes      Assumptions           |                                   |                                   |                                   |
| Fair      value of stock options granted | $1.52                                  | $1.06                                  | --                                     |
| Risk-free      interest rate             | 4.13%                                  | 2.75%                                  | --                                     |
| Volatility                               | 70%                                    | 102%                                   | --                                     |
| Weighted      average expected life      | 1.6      years                         | 1.8      years                         | --                                     |
| Dividend      yield                      | 0%                                     | 0%                                     | --                                     |

|   | i) | At      January 1, 2006, the impact of the adoption of FAS123(R) required the      Company to recognize a charge for past stock-based compensation options      granted of US$367,596 over the next 3 years in accordance with their      respective vesting periods.  In the year ended December 31,      2006, US$211,128 of this charge was recognized in the Consolidated      Statements of Operations as general and administrative      expense.  This resulted in an increase in the net loss and      comprehensive loss for the period in the same amount and no impact on the      net loss per share – basic and diluted for the period.  In the      year ended December 31, 2006, US$89,900 of this charge was recognized in      the Consolidated Balance Sheets as Oil and gas interests, not subject to      depletion. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii) | No      income tax benefit has been recognized relating to stock-based      compensation expense and no tax benefits have been realized from the      exercise of stock options.  There was no impact on cash flows      during years ended December 31, 2006 and2005. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                    |   | As      Reported                          |       |   | Adjustment                                                        |   |       | As      Restated                          |   |
|-------------------------------------------------------------------------|--------|-------------------------------------------|------------|--------|-------------------------------------------------------------------|--------|------------|-------------------------------------------|--------|
|                                                                    |   |   Dec      31, 2006US$          |       |   |                                                              |   |       |   Dec      31, 2006US$          |   |   | Period      of Inception,Aug      21, 2002to      Dec 31, 2005US$ |   |   |   Dec      31, 2006US$ |   |   |   |   |
| Balance      Sheets                                                     |   |                                      |       |   |                                                              |   |       |                                      |   |   |   |   |   |   |   |   |   |   |
| Oil      and gas interests                                              |   |                                      | 9,722,738  |   |                                                              |   |       |                                      |   | 657,536 |   |   |   | 1,741,060 |   |   |   | 12,121,334 |   |   |   |   |
| Additional      paid-in    capital                  |   |                                      | 47,077,827 |   |                                                              |   |       |                                      |   | 1,055,649 |   |   |   | 4,767,424 |   |   |   | 52,900,900 |   |   |   |   |
| Deficit      accumulated                                                |   |                                      | (2,990,674 | )      |                                                              |   |       |                                      |   | (398,113 | ) |   |   | (3,026,364 | ) |   |   | (6,415,151 | ) |   |   |   |
| Stockholders'      equity                                               |   |                                      | 44,138,770 |   |                                                              |   |       |                                      |   | 657,536 |   |   |   | 1,741,060 |   |   |   | 46,537,366 |   |   |   |   |
|                                                                    |   |                                      |       |   |                                                              |   |       |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Statement      ofStockholders'      Equity                              |   |                                      |       |   |                                                              |   |       |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Additional      paid-in    capital                  |   |                                      | 47,077,827 |   |                                                              |   |       |                                      |   | 1,055,649 |   |   |   | 4,767,424 |   |   |   | 52,900,900 |   |   |   |   |
| Accumulated      deficit                                                |   |                                      | (2,990,674 | )      |                                                              |   |       |                                      |   | (398,113 | ) |   |   | (3,026,364 | ) |   |   | (6,415,151 | ) |   |   |   |
| Stockholders'      equity                                               |   |                                      | 44,138,770 |   |                                                              |   |       |                                      |   | 657,536 |   |   |   | 1,741,060 |   |   |   | 46,537,366 |   |   |   |   |
|                                                                    |   |                                      |       |   |                                                              |   |       |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   |                                      |       |   |                                                              |   |       |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   | As      Reported                          |       |   | Adjustment                                                        |   |       | As      Restated                          |   |
|                                                                    |   |  Year      endedDec      31, 2006US$ |       |   | Period      of Inception,Aug      21, 2002to      Dec 31, 2006US$ |   |       |  Year      endedDec      31, 2006US$ |   |   | Period      of Inception,Aug      21, 2002to      Dec 31, 2006US$ |   |   |  Year      endedDec      31, 2006US$ |   |   | Period      of Inception,Aug      21, 2002 to      Dec 31, 2006US$ |   |
| Statements      of Operations                                           |   |                                      |       |   |                                                              |   |       |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General      and    administrative                  |   |                                      | 1,406,000  |   |                                                              |   | 2,510,716  |                                      |   |   | 484,926 |   |   |   | 484,926 |   |   |   | 1,890,926 |   |   |   | 2,995,642 |   |
| Consulting      fees                                                    |   |                                      | 1,190,919  |   |                                                              |   | 1,864,251  |                                      |   |   | (86,813 | ) |   |   | 2,939,551 |   |   |   | 1,104,106 |   |   |   | 4,803,802 |   |
| Net      loss and    comprehensive      loss        |   |                                      | (1,150,690 | )      |                                                              |   | (2,990,674 | )                                         |   |   | (398,113 | ) |   |   | (3,424,477 | ) |   |   | (1,548,803 | ) |   |   | (6,415,151 | ) |
| Net      loss per share    -      basic and diluted |   |                                      | (0.02      | )      |                                                              |   |       |                                      |   |   | (0.01 | ) |   |   |   |   |   |   | (0.03 | ) |   |   |   |   |

----

|                                                                    |   | As      Reported                          |       | Adjustment                                                        |               |                                      | As      Restated |
|-------------------------------------------------------------------------|--------|-------------------------------------------|------------|-------------------------------------------------------------------|--------------------|-------------------------------------------|------------------|
|                                                                    |   |   Dec      31, 2005US$          |       |                                                              |               |   Dec      31, 2005US$          |             |   | Period      of Inception,Aug      21, 2002to      Dec 31, 2004US$ |   |   |   Dec      31, 2005US$ |   |   |
| Balance      Sheets                                                     |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |
| Oil      and gas interests                                              |   |                                      | 2,216,663  |                                                              |               |                                      |             | 1,672,576 |   |   |   | 68,484 |   |   |   | 3,957,723 |   |   |
| Additional      paid-in   capital                        |   |                                      | 40,275,588 |                                                              |               |                                      |             | 4,354,256 |   |   |   | 413,168 |   |   |   | 45,043,012 |   |   |
| Deficit      accumulated                                                |   |                                      | (1,839,984 | )                                                                 |               |                                      |             | (2,681,680 | ) |   |   | (344,684 | ) |   |   | (4,866,348 | ) |   |
| Stockholders'      equity                                               |   |                                      | 38,483,965 |                                                              |               |                                      |             | 1,672,576 |   |   |   | 68,484 |   |   |   | 40,225,025 |   |   |
|                                                                    |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
| Statement      ofStockholders'      Equity                              |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
| Additional      paid-in    capital                  |   |                                      | 40,275,588 |                                                              |               |                                      |             | 4,354,256 |   |   |   | 413,168 |   |   |   | 45,043,012 |   |   |
| Accumulated      deficit                                                |   |                                      | (1,839,984 | )                                                                 |               |                                      |             | (2,681,680 | ) |   |   | (344,684 | ) |   |   | (4,866,348 | ) |   |
| Stockholders'      equity                                               |   |                                      | 38,483,965 |                                                              |               |                                      |             | 1,672,576 |   |   |   | 68,484 |   |   |   | 40,225,025 |   |   |
|                                                                    |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   | As      Reported                          |       | Adjustment                                                        |               |                                      | As      Restated |
|                                                                    |   |  Year      endedDec      31, 2005US$ |       | Period      of Inception,Aug      21, 2002to      Dec 31, 2005US$ |               |  Year      endedDec      31, 2005US$ |             |   | Period      of Inception,Aug      21, 2002to      Dec 31, 2005US$ |   |   |  Year      endedDec      31, 2005US$ |   | Period      of Inception,Aug      21, 2002 to      Dec 31, 2005US$ |
| Statements      of Operations                                           |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
| Consulting      fees                                                    |   |                                      | 265,446    |                                                              | 673,332            |                                      |             | 2,681,680 |   |   |   | 3,026,364 |   |   |   | 2,947,126 |   | 3,699,696 |
| Net      loss and    comprehensive      loss        |   |                                      | (480,980   | )                                                                 |  (1,839,984)) |                                      |             | (2,681,680 | ) |   |   | (3,026,364 | ) |   |   | (3,162,660 | ) |  (4,866,348)) |
| Net      loss per share    -      basic and diluted |   |                                      | (0.01      | )                                                                 |               |                                      |             | (0.05 | ) |   |   |   |   |   |   | (0.06 | ) |   |

----

|                                                                    |   | As      Reported                          |       | Adjustment                                                        |               |                                      | As      Restated |
|-------------------------------------------------------------------------|--------|-------------------------------------------|------------|-------------------------------------------------------------------|--------------------|-------------------------------------------|------------------|
|                                                                    |   |   Dec      31, 2004US$          |       |                                                              |               |   Dec      31, 2004US$          |             |   | Period      of Inception,Aug      21, 2002to      Dec 31, 2003US$ |   |   |   Dec      31, 2004US$ |   |   |
| Balance      Sheets                                                     |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |
| Oil      and gas interests                                              |   |                                      | 638,539    |                                                              |               |                                      |             | 46,253 |   |   |   | 22,231 |   |   |   | 707,023 |   |   |
| Additional      paid-in   capital                        |   |                                      | 6,831,434  |                                                              |               |                                      |             | 350,255 |   |   |   | 62,913 |   |   |   | 7,244,602 |   |   |
| Deficit      accumulated                                                |   |                                      | (1,359,004 | )                                                                 |               |                                      |             | (304,002 | ) |   |   | (40,682 | ) |   |   | (1,703,688 | ) |   |
| Stockholders'      equity                                               |   |                                      | 5,513,045  |                                                              |               |                                      |             | 46,253 |   |   |   | 22,231 |   |   |   | 5,581,529 |   |   |
|                                                                    |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
| Statement      ofStockholders'      Equity                              |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
| Additional      paid-in    capital                  |   |                                      | 6,831,434  |                                                              |               |                                      |             | 350,255 |   |   |   | 62,913 |   |   |   | 7,244,602 |   |   |
| Accumulated      deficit                                                |   |                                      | (1,359,004 | )                                                                 |               |                                      |             | (304,002 | ) |   |   | (40,682 | ) |   |   | (1,703,688 | ) |   |
| Stockholders'      equity                                               |   |                                      | 5,513,045  |                                                              |               |                                      |             | 46,253 |   |   |   | 22,231 |   |   |   | 5,581,529 |   |   |
|                                                                    |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   | As      Reported                          |       | Adjustment                                                        |               |                                      | As      Restated |
|                                                                    |   |  Year      endedDec      31, 2004US$ |       | Period      of Inception,Aug      21, 2002to      Dec 31, 2004US$ |               |  Year      endedDec      31, 2004US$ |             |   | Period      of Inception,Aug      21, 2002to      Dec 31, 2004US$ |   |   |  Year      endedDec      31, 2004US$ |   | Period      of Inception,Aug      21, 2002 to      Dec 31, 2004US$ |
| Statements      of Operations                                           |   |                                      |       |                                                              |               |                                      |             |   |   |   |   |   |   |   |   |   |   |   |
| Consulting      fees                                                    |   |                                      | 237,615    |                                                              | 407,886            |                                      |             | 304,002 |   |   |   | 344,684 |   |   |   | 541,617 |   | 752,570 |
| Net      loss and    comprehensive      loss        |   |                                      | (867,496   | )                                                                 |  (1,359,004)) |                                      |             | (304,002 | ) |   |   | (344,684 | ) |   |   | (1,171,498 | ) |  (1,703,688)) |
| Net      loss per share    -      basic and diluted |   |                                      | (0.02      | )                                                                 |               |                                      |             | (0.01 | ) |   |   |   |   |   |   | (0.03 | ) |   |

----

|                                               | Year      endedDec      31, 2006 | Year      endedDec      31, 2005 | Year      endedDec      31, 2004 |
|----------------------------------------------------|----------------------------------|----------------------------------|----------------------------------|
|                                               | Restatednote      6c             | Restatednote      6c             | Restatednote      6c             |
|                                               |                             |                             |                             |
| Fair      value of stock options at reporting date | US$4.15                          | US$4.52                          | US$0.73                          |
| Risk-free      interest rate                       | 4.89%                            | 3.33%                            | 1.67%                            |
| Volatility                                         | 86%                              | 103%                             | 98%                              |
| Expected      life                                 | 0.9      years                   | 0.5      years                   | 0.5      years                   |
| Dividend      yield                                | 0%                               | 0%                               | 0%                               |

|       |      | Fair      Value  |                    |       |           |          | Cancelled      (c)   |           |           |
|------------|-----------|------------------|-------------------------|------------|----------------|---------------|----------------------|----------------|----------------|
|       | Option    | at      Original |                    |       |           | Granted       | Expired      (x)     |           | Balance        |
| Grant      | exercise  | Grant            | Expiry                  | Vesting    | Balance        | during        | Exercised      (e)   | Balance        | exercisable    |
| date       | price     | Date             | date                    | date       | Dec      31/05 | the      year | during      the year | Dec      31/06 | Dec      31/06 |
| (mm/dd/yy) | US      $ | US$              | (mm/dd/yy)              | (mm/dd/yy) | #              | #             | #                    | #              | #              |
|       |      |             |                    |       |           |          |                 |           |           |
| 12/09/03   | 1.18      | .241             | 08/31/06                | Vested     | 1,751,500      | --            | 1,721,500      (e)   | --             | --             |
|       |      |             |                    |       |           |          | 30,000      (x)      | --             | --             |
| 12/30/03   | 1.50      | .317             | 08/31/06                | Vested     | 345,000        | --            | 345,000      (e)     | --             | --             |
| 01/17/05   | 1.01      | .380             |  (i)      06/30/07 | Vested     | 579,500        | --            | 377,000      (e)     | 202,500        | 202,500        |
| 01/17/05   | 1.01      | .380             | (i)      06/30/07       | 05/31/07   | 150,000        | --            | --                   | 150,000        | --             |
| 01/18/05   | 1.10      | .622             | 08/31/08                | Vested     | 600,000        | --            | --                   | 600,000        | 600,000        |
| 01/25/05   | 1.17      | .434             | 08/31/06                | Vested     | 25,000         | --            | 25,000      (e)      | --             | --             |
| 06/14/05   | 3.49      | 1.553            | 06/14/15                | Vested     | 150,000        | --            | --                   | 150,000        | 150,000        |
| 08/24/05   | 6.50      | 2.380            | 08/24/08                | Vested     | 110,000        | --            | --                   | 110,000        | 110,000        |
| 10/03/05   | 6.81      | 3.070            | 10/03/15                | Vested     | 16,666         | --            | -                    | 16,666         | 16,666         |
| 10/03/05   | 6.81      | 3.833            | 10/03/15                | 10/03/07   | 16,667         | --            | --                   | 16,667         | --             |
| 10/03/05   | 6.81      | 4.383            | 10/03/15                | 10/03/08   | 16,667         | --            | --                   | 16,667         | --             |
| 06/14/06   | 5.09      | 2.057            | 06/14/16                | 06/14/07   | --             | 200,000       | --                   | 200,000        | --             |
| 07/25/06   | 3.95      | 1.141            | 12/31/09                | Vested     | --             | 100,000       | --                   | 100,000        | 100,000        |
| 07/25/06   | 3.95      | 1.393            | 12/31/09                | 07/25/07   | --             | 660,000       | --                   | 660,000        | --             |
| 07/25/06   | 3.95      | 1.601            | 12/31/09                | 12/31/07   | --             | 50,000        | --                   | 50,000         | --             |
| 07/25/06   | 3.95      | 1.779            | 12/31/09                | 07/25/08   | --             | 145,000       | --                   | 145,000        | --             |
| 07/25/06   | 3.95      | 2.006            | 12/31/09                | 07/25/09   | --             | 70,000        | --                   | 70,000         | --             |
| 07/25/06   | 3.95      | 1.141            | 07/25/16                | Vested     | --             | 500,000       | --                   | 500,000        | 500,000        |
| 07/25/06   | 3.95      | 1.141            | 07/25/16                | 07/25/07   | --             | 500,000       | --                   | 500,000        | --             |
| 11/24/06   | 7.52      | 2.467            | 11/24/09                | 06/30/07   | --             | 10,000        | --                   | 10,000         | --             |
| 11/24/06   | 7.52      | 2.919            | 11/24/09                | 12/31/07   | --             | 10,000        | --                   | 10,000         | --             |
| 11/24/06   | 7.52      | 3.695            | 11/24/09                | 12/31/08   | --             | 10,000        | --                   | 10,000         | --             |
|       |      |             |                    |       | 3,761,000      | 2,255,000     | 2,498,500            | 3,517,500      | 1,679,166      |

----

|   | i) | On      August 30, 2006, the Board of Directors of the Company passed a resolution      with respect to the remaining stock options issued on January 17, 2005 to      (a) extend the expiry date of all then outstanding options from August 31,      2006 to the earlier of June 30, 2007 or 60 days following the date of a      “Commercial Discovery” as defined under the terms of the PSC on Block      KG-OSN-2001/3 and (b) to extend the vesting date of certain of these      options to the earlier of the date of a “Commercial Discovery” as defined      under the terms of the PSC on Block KG-OSN-2001/3 or May 31, 2007, as long      as drilling operations are continuing on the KG Offshore      Block.  This resolution resulted in an added incremental      stock-based compensation cost of $9,040 with respect to the three      employees and three consultants. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii) | During      the year ended December 31, 2006, the Company granted options to purchase      2,255,000 shares exercisable at various prices and expiry dates, which      vest in their entirety on the vestingdate. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iii) | As      at December 31, 2006, there were 3,517,500 options outstanding at various      prices which, if exercised, would result in total proceeds of      US$11,837,375. |
|--------|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iv) | Of      the 2,498,500 options exercised or expired during the year, 195,000,      415,000, 1,853,500 and 5,000 were exercised during the three months ending      March 31, June 30, September 30 and December 31, respectively for gross      cash proceeds of US$206,050, US$548,100, US$1,949,980 and US$5,050      respectively, and the remaining 30,000 expired during the three months      ended September 30, 2006. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | v) | At      the annual stockholder meeting held on June 14, 2006, the stockholders of      the Company approved amendments to the Plan to increase the shares of      Common Stock reserved for issuance under the Plan from 8,000,000 shares to      12,000,000. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f) | Notes      receivable |
|----|-----------------------|

|   | Pursuant      to the terms of the Company's 1998 Stock Incentive Plan, during the third      quarter of 2006, certain employees and consultants to the Company      exercised 184,500 options to purchase shares of common stock of the      Company and delivered to the Company their promissory notes in the      aggregate principal amount of US$249,710 in payment of the exercise      price.  The promissory notes were due December 31, 2006 and bore      interest at 8.25% per annum.  All promissory notes were repaid      on or before December 31, 2006. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                  |   | US      $ |      |
|-------------------------------------------------------|--------|-----------|-----------|
| Net      assets acquired                              |   |      |      |
| Cash                                                  |   |      | 3,034,666 |   |
| Other      current assets                             |   |      | 75,000    |   |
| Current      liabilities                              |   |      | (2,706    | ) |
|                                                  |   |      |      |   |
| Net      book value of identifiable assets acquired   |   |      | 3,106,960 |   |
|                                                  |   |      |      |   |
| Consideration      paid                               |   |      |      |   |
| Promissory      note issued                           |   |      | 2,000,000 |   |
| 34,000,000      common shares issued par value $0.001 |   |      | 34,000    |   |
| Additional      paid-in capital                       |   |      | 1,072,960 |   |
|                                                  |   |      |      |   |
|                                                  |   |      | 3,106,960 |   |

----

|                                      |   |  Year      endedDec      31, 2006 |    |   |  Year      endedDec      31, 2005 |   |    |  Year      endedDec      31, 2004 |   |   | Period      fromInception,Aug      21, 2002to      Dec 31, 2006 |   |
|-------------------------------------------|--------|----------------------------------------|---------|--------|----------------------------------------|--------|---------|----------------------------------------|--------|--------|-----------------------------------------------------------------|--------|
|                                      |   | US      $                              |    |   | US      $                              |   |    | US      $                              |   |   | US$                                                             |   |
| Consolidated      Statement of Operations |   |                                   |    |   |                                   |   |    |                                   |   |   |                                                            |   |
| Consulting      fees                      |   |                                   | 70,000  |   |                                   |   | 62,000  |                                   |   |   | 50,000                                                          |   |   |   | 198,667 |   |
| Consolidated      Balance Sheets          |   |                                   |    |   |                                   |   |    |                                   |   |   |                                                            |   |   |   |   |   |
| Oil      & gas interests              |   |                                   |    |   |                                   |   |    |                                   |   |   |                                                            |   |   |   |   |   |
| Exploration      costs - India (note 4b)  |   |                                   | 280,000 |   |                                   |   | 248,000 |                                   |   |   | 200,000                                                         |   |   |   | 794,666 |   |
|                                      |   |                                   | 350,000 |   |                                   |   | 310,000 |                                   |   |   | 250,000                                                         |   |   |   | 993,333 |   |

| Consolidated      Statement of Operations |   |   |    |   |   |   |   |   |   |   |   |   |
|-------------------------------------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Consulting      fees                      |   |   | 80,821  |   |   |   | --     |   |   |   | --     |   |   |   | 80,821 |   |
| Consolidated      Balance Sheets          |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Oil      & gas interests              |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Exploration      costs - India (note 4b)  |   |   | 323,283 |   |   |   | --     |   |   |   | --     |   |   |   | 323,283 |   |
|                                      |   |   | 404,104 |   |   |   | --     |   |   |   | --     |   |   |   | 404,104 |   |

| Consolidated      Statement of Operations |   |   |    |   |   |   |    |   |   |   |    |   |
|-------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|
| General      and administrative           |   |   | 47,820  |   |   |   | 45,430  |   |   |   | 19,640  |   |   |   | 153,539 |   |
| Consolidated      Balance Sheets          |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Accounts      receivable                  |   |   | 227     |   |   |   | 1,020   |   |   |   | 20,350  |   |   |   | 21,597 |   |
| Oil      & gas interests              |   |   |    |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Exploration      costs - India (note 4b)  |   |   | 86,590  |   |   |   | 127,295 |   |   |   | 87,165  |   |   |   | 384,387 |   |
| Property      and equipment               |   |   | --      |   |   |   | 1,610   |   |   |   | 8,064   |   |   |   | 37,595 |   |
|                                      |   |   | 134,637 |   |   |   | 175,355 |   |   |   | 135,219 |   |   |   | 597,118 |   |

----

|                                      |   |  Year      endedDec      31, 2006 |    |   |  Year      endedDec      31, 2005 |   |    |  Year      endedDec      31, 2004 |   |   | Period      fromInception,Aug      21, 2002to      Dec 31, 2006 |   |
|-------------------------------------------|--------|----------------------------------------|---------|--------|----------------------------------------|--------|---------|----------------------------------------|--------|--------|-----------------------------------------------------------------|--------|
|                                      |   | US      $                              |    |   | US      $                              |   |    | US      $                              |   |   | US$                                                             |   |
| Consolidated      Statement of Operations |   |                                   |    |   |                                   |   |    |                                   |   |   |                                                            |   |
| Consulting      fees                      |   |                                   | 185,000 |   |                                   |   | 150,000 |                                   |   |   | 120,000                                                         |   |   |   | 516,715 |   |

| Consolidated      Statement of Operations |   |   |    |   |   |   |   |   |   |   |   |   |
|-------------------------------------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Consulting      fees                      |   |   | 404,104 |   |   |   | --     |   |   |   | --     |   |   |   | 404,104 |   |

| Consolidated      Statement of Operations                    |   |   |   |   |   |   |   |   |   |   |   |   |
|--------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| General      and administrative                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Office      costs                                            |   |   | 19,935 |   |   |   | 54,062 |   |   |   | 65,073 |   |   |   | 179,070 |   |
| Travel,      hotel, meals and   entertainment |   |   | 1,176  |   |   |   | 5,121  |   |   |   | 3,344  |   |   |   | 48,686 |   |
| Consolidated      Balance Sheets                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Accounts      receivable                                     |   |   | 13,224 |   |   |   | 14,165 |   |   |   | --     |   |   |   | 27,389 |   |
| Property      and equipment                                  |   |   | 4,107  |   |   |   | --     |   |   |   | --     |   |   |   | 4,107 |   |
|                                                         |   |   | 38,442 |   |   |   | 73,348 |   |   |   | 68,417 |   |   |   | 259,252 |   |

----

|                                      |   |  Year      endedDec      31, 2006 |   |   |  Year      endedDec      31, 2005 |   |   |  Year      endedDec      31, 2004 |   |   | Period      fromInception,Aug      21, 2002to      Dec 31, 2006 |   |
|-------------------------------------------|--------|----------------------------------------|--------|--------|----------------------------------------|--------|--------|----------------------------------------|--------|--------|-----------------------------------------------------------------|--------|
|                                      |   | US      $                              |   |   | US      $                              |   |   | US      $                              |   |   | US$                                                             |   |
| Consolidated      Statement of Operations |   |                                   |   |   |                                   |   |   |                                   |   |   |                                                            |   |
| Consulting      fees                      |   |                                   | 56,257 |   |                                   |   | 35,713 |                                   |   |   | 33,921                                                          |   |   |   | 140,360 |   |

| Consolidated      Statement of Operations |   |   |   |   |   |   |   |   |   |   |   |   |
|-------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| General      and administrative           |   |   | 1,654  |   |   |   | 685    |   |   |   | 1,961  |   |   |   | 4,468 |   |
| Consolidated      Balance Sheets          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Accounts      receivable                  |   |   | 3,725  |   |   |   | 2,530  |   |   |   | 967    |   |   |   | 10,274 |   |
| Property      and equipment               |   |   | --     |   |   |   | --     |   |   |   | 1,599  |   |   |   | 1,599 |   |
|                                      |   |   | 5,379  |   |   |   | 3,215  |   |   |   | 4,527  |   |   |   | 16,341 |   |

|                                                                                |   |  Year      endedDec      31, 2006 |       |   |  Year      endedDec      31, 2005 |   |       |  Year      endedDec      31, 2004 |   |   | Period      fromInception,Aug      21, 2002to      Dec 31, 2006 |   |
|-------------------------------------------------------------------------------------|--------|----------------------------------------|------------|--------|----------------------------------------|--------|------------|----------------------------------------|--------|--------|-----------------------------------------------------------------|--------|
|                                                                                |   | US      $                              |       |   | US      $                              |   |       | US      $                              |   |   | US$                                                             |   |
|                                                                                |   | Restatednote      5c                   |       |   | Restatednote      5c                   |   |       | Restatednote      5c                   |   |   | Restatednote      5c                                            |   |
|                                                                                |   |                                   |       |   |                                   |   |       |                                   |   |   |                                                            |   |
| Net      loss                                                                       |   |                                   | (1,548,803 | )      |                                   |   | (3,162,660 | )                                      |   |   | (1,171,498                                                      | )      |   |   | (6,415,151 | ) |
| Expected      tax rate                                                              |   |                                   | 35.00      | %      |                                   |   | 35.00      | %                                      |   |   | 35.00                                                           | %      |   |   |   |   |
| Expected      income tax recovery                                                   |   |                                   | (542,081   | )      |                                   |   | (1,106,931 | )                                      |   |   | (410,024                                                        | )      |   |   | (2,246,286 | ) |
| Excess      of expected tax rate over taxrate      of  foreign affiliates |   |                                   | 90,323     |   |                                   |   | 55,912     |                                   |   |   | 54,623                                                          |   |   |   | 227,622 |   |
| Non-deductible      expenditures                                                    |   |                                   | 605,618    |   |                                   |   | 965,779    |                                   |   |   | 122,589                                                         |   |   |   | 1,716,006 |   |
| Utilization      of non-capital losses                                              |   |                                   | (112,501   | )      |                                   |   | --         |                                   |   |   | --                                                              |   |   |   | (112,501 | ) |
| Acquisition      of losses                                                          |   |                                   | --         |   |                                   |   | --         |                                   |   |   | --                                                              |   |   |   | 4,355,268 |   |
| Other                                                                               |   |                                   | (175,173   | )      |                                   |   | 165,772    |                                   |   |   | 298,110                                                         |   |   |   | 614,520 |   |
|                                                                                |   |                                   | (133,814   | )      |                                   |   | 80,532     |                                   |   |   | 65,298                                                          |   |   |   | 4,554,629 |   |
|                                                                                |   |                                   |       |   |                                   |   |       |                                   |   |   |                                                            |   |   |   |   |   |
| Valuation      allowance                                                            |   |                                   | 133,814    |   |                                   |   | (80,532    | )                                      |   |   | (65,298                                                         | )      |   |   | (4,554,629 | ) |
| Provision      for income taxes                                                     |   |                                   | --         |   |                                   |   | --         |                                   |   |   | --                                                              |   |   |   | -- |   |

----

|                                                                       |   | Dec      31, 2006US      $ |       |   | Dec      31, 2005US      $ |   |
|----------------------------------------------------------------------------|--------|----------------------------|------------|--------|----------------------------|--------|
|                                                                       |   |                       |       |   |                       |   |
| Difference      between tax base and reported amounts of depreciableassets |   |                       | 25,873     |   |                       |   | 25,871 |   |
| Non-capital      loss carry forwards                                       |   |                       | 2,525,363  |   |                       |   | 2,645,060 |   |
|                                                                       |   |                       | 2,551,236  |   |                       |   | 2,670,931 |   |
| Valuation      allowance                                                   |   |                       | (2,551,236 | )      |                       |   | (2,670,931 | ) |
| Deferred      income tax asset                                             |   |                       | --         |   |                       |   | -- |   |

|  Tax      Jurisdiction |   | AmountUS      $ |      | Expiry      DatesCommence |
|-----------------------------|--------|-----------------|-----------|---------------------------|
|                        |   |            |      |                      |
| United      States          |   |            | 7,168,590 |                      | 2023 |
| Canada                      |   |            | 152       |                      | 2010 |
| Barbados                    |   |            | 652,224   |                      | 2012 |
|                        |   |            | 7,820,966 |                      |   |

|                         |   | Dec      31, 2006US      $ |       |   | Dec      31, 2005US      $ |   |
|------------------------------|--------|----------------------------|------------|--------|----------------------------|--------|
| Oil      & gas interests |   |                       |       |   |                       |   |
| India                        |   |                       | 12,121,334 |   |                       |   | 3,957,723 |   |

----

| a) | Restricted      cash |
|----|----------------------|

|   | i) | The      PSC's contain provisions whereby the joint venture participants must      provide the GOI a bank guarantee in the amount of 35% of the participant's      share of the minimum work program for a particular phase, to be undertaken      annually during the budget period April 1 to March 31.  These      bank guarantees have been provided to the GOI and serve as guarantees for      the performance of such minimum work program and are in the form of      irrevocable letters of credit which are secured by restricted cash term      deposits of the Company in the sameamount. |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      restricted cash term deposits securing these bank guarantees are as      follows: |
|--------|--------------------------------------------------------------------------------------------|

|                   |   | December      31, 2006 |      |   | December      31, 2005 |   |
|------------------------|--------|------------------------|-----------|--------|------------------------|--------|
|                   |   | US      $              |      |   | US      $              |   |
| Exploration      Block |   |                   |      |   |                   |   |
| Mehsana                |   |                   | 711,445   |   |                   |   | 195,055 |   |
| Sanand/Miroli          |   |                   | 905,000   |   |                   |   | 197,430 |   |
| Ankleshwar             |   |                   | 600,000   |   |                   |   | -- |   |
| Tarapur                |   |                   | 1,200,000 |   |                   |   | -- |   |
| DS                     |   |                   | 110,000   |   |                   |   | -- |   |
|                   |   |                   | 3,526,445 |   |                   |   | 392,485 |   |

|   | ii) | The      Company has provided to its bankers as security for credit cards issued to      employees for business purposes two restricted cash term deposits, one in      the amount of US$30,000 and the other  in the amount of      US$34,324 (Cdn$40,000). |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | b) | Production      Sharing Contracts |
|--------|----|-----------------------------------|

|   | The      Company is required to expend funds on the exploration activities to      fulfill the terms of the minimum work commitment based on our      participating interest for Phase I pursuant to the PSC’s in respect of      each of our exploration blocks asfollows: |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | i) | Mehsana      Block - Acquire, process and interpret 75 sq kms of 3D seismic and drill 7      exploratory wells between 1,000 and 2,200  meters. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii) | Sanand/Miroli      Block - Acquire, process and interpret 200 sq kms of 3D seismic and drill      12 exploratory wells between 1,500 and 3,000  meters. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iii) | Ankleshwar      Block - Acquire, process and interpret 448 sq kms of 3D seismic and drill      14 exploratory wells between 1,500 and 2,500  meters. |
|--------|------|------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | c) | KG      Offshore Block |
|--------|----|------------------------|

----

|   | As      the holder of a participating interest in the Tarapur Block, the Company      is required to fund its 20% share of all exploration and development costs      incurred on the exploration block.  To December 31, 2006,      US$3,972,765 has been incurred under the terms of the Company's agreement      with GSPC.  Of this amount, US$3,017,646 has been paid to GSPC      and US$955,119 is in accounts payable at December 31, 2006.  The      Company has budgeted to expend approximately US$2.7 million for      exploration activities under the terms of the agreement over the period      April 1, 2007 to November 22, 2007.  These activities include      the drilling of 3 exploration wells and the acquisition of 90 sq kms of      3-D seismic.  Under the terms of the agreement, the Company is      required to keep in force a financial and performance guarantee securing      its performance under the TarapurPSC. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | e) | Corporate      Head Office |
|--------|----|----------------------------|

|   | 12. | Comparative      Figures |
|--------|-----|--------------------------|

|   | a) | As      the Company is in its development stage, these figures represent the      accumulated amounts of the continuing entity for the period from      inception, being August 21, 2002 to December 31,  2006. |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b) | Certain      comparative figures have been reclassified to conform with the      presentation adopted in the currentyear. |
|----|---------------------------------------------------------------------------------------------------------------------------|

|   | i) | Exploration      Block KG-ONN-2004/1 (KG Onshore Block) - Reprocess 564 LKM of 2-D seismic;      conduct a gravity and magnetic and geochemical survey; acquire, process      and interpret 548 sq kms of 3-D seismic; and drill 12 exploratory wells      between 2,000 and 5,000 meters. |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ii) | Exploration      Block RJ-ONN-2004/2 (RJ Block 20) - Reprocess 463 LKM of 2-D seismic;      conduct a gravity and magnetic and geochemical survey; acquire, process      and interpret 250 LKM of 2-D seismic and 700 sq kms of 3-D seismic; and      drill a total of 12 exploratory wells between 2,000 and 2,500      meters. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | iii) | Exploration      Block RJ-ONN-2004/3 (RJ Block 21) - Reprocess 463 LKM of 2-D seismic;      conduct a gravity and magnetic and geochemical survey; acquire, process      and interpret 310 LKM of 2-D seismic and 611 sq kms of 3-D seismic; and      drill a total of 8 exploratory wells between 2,000 and 2,500      meters. |
|--------|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | iv) | Exploration      Block DS-ONN-2004/1 (DS 04 Block) - Gravity and magnetic and geochemical      surveys; acquire, process and interpret 325 LKM of 2-D seismic; and drill      10 core holes to a depth of approximately 500  meters. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                   |   | 3      months ended |       |   | 3      months ended |   |      | 6      months ended |   |   | 3      months ended |   |   | 9      months ended |      |   | Yearended   |   |
|----------------------------------------------------------------------------------------|--------|---------------------|------------|--------|---------------------|--------|-----------|---------------------|--------|--------|---------------------|--------|--------|---------------------|-----------|--------|-------------|--------|
|                                                                                   |   | Mar      31         |       |   | June      30        |   |      | June      30        |   |   | Sept      30        |   |   | Sept      30        |      |   | Dec      31 |   |
| 2006                                                                                   |   | US$                 |       |   | US$                 |   |      | US$                 |   |   | US$                 |   |   | US$                 |      |   | US$         |   |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |
| Interest      income                                                                   |   |                | 399,869    |   |                |   | 427,749   |                |   |   | 827,618             |   |   |                | 461,123   |   |        |   | 1,288,741 |   |   |   | 1,751,550 |   |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| Net      earnings (loss) and    comprehensive      earnings (loss) |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | (31,726    | )      |                |   | (125,873  | )                   |   |   | (157,599            | )      |   |                | (368,527  | )      |        |   | (526,126 | ) |   |   | (1,150,690 | ) |
| Adjustment                                                                             |   |                | 33,713     |   |                |   | --        |                |   |   | 33,713              |   |   |                | (87,769   | )      |        |   | (54,056 | ) |   |   | (398,113 | ) |
| As      restated                                                                       |   |                | 1,987      |   |                |   | (125,873  | )                   |   |   | (123,886            | )      |   |                | (456,296  | )      |        |   | (580,182 | ) |   |   | (1,548,803 | ) |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| Net      earnings (loss) per share    -      basic and diluted     |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | 0.00       |   |                |   | 0.00      |                |   |   | 0.00                |   |   |                | (0.01     | )      |        |   | (0.01 | ) |   |   | (0.02 | ) |
| Adjustment                                                                             |   |                | 0.00       |   |                |   | 0.00      |                |   |   | 0.00                |   |   |                | 0.00      |   |        |   | 0.00 |   |   |   | (0.01 | ) |
| As      restated                                                                       |   |                | 0.00       |   |                |   | 0.00      |                |   |   | 0.00                |   |   |                | (0.01     | )      |        |   | (0.01 | ) |   |   | (0.03 | ) |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| Deficit                                                                                |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | (1,871,710 | )      |                |   |      |                |   |   | (1,997,583          | )      |   |                |      |   |        |   | (2,366,110 | ) |   |   | (2,990,674 | ) |
| Adjustment      - prior years                                                          |   |                | (3,026,364 | )      |                |   |      |                |   |   | (3,026,364          | )      |   |                |      |   |        |   | (3,026,364 | ) |   |   | (3,026,364 | ) |
| Adjustment      - current period                                                       |   |                | 33,713     |   |                |   |      |                |   |   | 33,713              |   |   |                |      |   |        |   | (54,056 | ) |   |   | (398,113 | ) |
| As      restated                                                                       |   |                | (4,864,361 | )      |                |   |      |                |   |   | (4,990,234          | )      |   |                |      |   |        |   | (5,446,530 | ) |   |   | (6,415,151 | ) |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| Oil      and gas interests                                                             |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | 2,226,981  |   |                |   | 1,821,069 |                |   |   | 4,048,050           |   |   |                | 1,495,199 |   |        |   | 5,543,249 |   |   |   | 7,506,075 |   |
| Adjustment      - current period                                                       |   |                | 515,776    |   |                |   | (78,376   | )                   |   |   | 437,400             |   |   |                | 37,858    |   |        |   | 475,258 |   |   |   | 657,536 |   |
| As      restated - current period                                                      |   |                | 2,742,757  |   |                |   | 1,742,693 |                |   |   | 4,485,450           |   |   |                | 1,533,057 |   |        |   | 6,018,507 |   |   |   | 8,163,611 |   |
| Opening      balance - beginning of year                                               |   |                | 3,957,723  |   |                |   |      |                |   |   | 3,957,723           |   |   |                |      |   |        |   | 3,957,723 |   |   |   | 3,957,723 |   |
| As      restated                                                                       |   |                | 6,700,480  |   |                |   |      |                |   |   | 8,443,173           |   |   |                |      |   |        |   | 9,976,230 |   |   |   | 12,121,334 |   |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| Stock-based      compensation                                                          |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| General      and administrative                                                        |   |                | --         |   |                |   | --        |                |   |   | --                  |   |   |                | 167,419   |   |        |   | 380,460 |   |   |   | 563,551 |   |
| Consulting                                                                             |   |                | --         |   |                |   | --        |                |   |   | --                  |   |   |                | 252,090   |   |        |   | 252,090 |   |   |   | 626,625 |   |
| Stock-based      compensation                                                          |   |                | 118,808    |   |                |   | 94,233    |                |   |   | 213,041             |   |   |                | --        |   |        |   | -- |   |   |   | -- |   |
|                                                                                   |   |                | 118,808    |   |                |   | 94,233    |                |   |   | 213,041             |   |   |                | 419,509   |   |        |   | 632,550 |   |   |   | 1,190,176 |   |
| Oil      and gas interests                                                             |   |                | --         |   |                |   | 33,712    |                |   |   | 67,425              |   |   |                | 326,385   |   |        |   | 393,810 |   |   |   | 766,689 |   |
|                                                                                   |   |                | 118,808    |   |                |   | 127,945   |                |   |   | 280,466             |   |   |                | 745,894   |   |        |   | 1,026,360 |   |   |   | 1,956,865 |   |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| Adjustment                                                                             |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| General      and administrative                                                        |   |                | 85,095     |   |                |   | 94,233    |                |   |   | 179,328             |   |   |                | 193,970   |   |        |   | 373,298 |   |   |   | 484,926 |   |
| Consulting                                                                             |   |                | --         |   |                |   | --        |                |   |   | --                  |   |   |                | (106,201  | )      |        |   | (106,201 | ) |   |   | (86,813 | ) |
| Stock-based      compensation                                                          |   |                | (118,808   | )      |                |   | (94,233   | )                   |   |   | (213,041            | )      |   |                | --        |   |        |   | -- |   |   |   | -- |   |
|                                                                                   |   |                | (33,713    | )      |                |   | --        |                |   |   | (33,713             | )      |   |                | 87,769    |   |        |   | 267,097 |   |   |   | 398,113 |   |
| Oil      and gas interests                                                             |   |                | 515,776    |   |                |   | (78,376   | )                   |   |   | 437,400             |   |   |                | 37,857    |   |        |   | 475,258 |   |   |   | 657,536 |   |
|                                                                                   |   |                | 482,063    |   |                |   | (78,376   | )                   |   |   | 403,687             |   |   |                | 125,626   |   |        |   | 742,355 |   |   |   | 1,055,649 |   |
|                                                                                   |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| As      restated                                                                       |   |                |       |   |                |   |      |                |   |   |                |   |   |                |      |   |        |   |   |   |   |   |   |   |
| General      and administrative                                                        |   |                | 85,095     |   |                |   | 94,233    |                |   |   | 179,328             |   |   |                | 361,389   |   |        |   | 753,758 |   |   |   | 1,048,477 |   |
| Consulting                                                                             |   |                | --         |   |                |   | --        |                |   |   | --                  |   |   |                | 145,889   |   |        |   | 145,889 |   |   |   | 539,812 |   |
| Stock-based      compensation                                                          |   |                | --         |   |                |   | --        |                |   |   | --                  |   |   |                | --        |   |        |   | -- |   |   |   | -- |   |
|                                                                                   |   |                | 85,095     |   |                |   | 94,233    |                |   |   | 179,328             |   |   |                | 507,278   |   |        |   | 899,647 |   |   |   | 1,588,289 |   |
| Oil      and gas interests                                                             |   |                | 515,776    |   |                |   | (44,664   | )                   |   |   | 504,825             |   |   |                | 364,242   |   |        |   | 869,068 |   |   |   | 1,424,225 |   |
|                                                                                   |   |                | 600,871    |   |                |   | 49,569    |                |   |   | 684,153             |   |   |                | 871,520   |   |        |   | 1,768,715 |   |   |   | 3,012,514 |   |

----

|                                                                                   |   | 3      months ended |       |   | 3      months ended |   |       | 6      months ended |   |   | 3      months ended |   |   | 9      months ended |     |   | Yearended   |   |
|----------------------------------------------------------------------------------------|--------|---------------------|------------|--------|---------------------|--------|------------|---------------------|--------|--------|---------------------|--------|--------|---------------------|----------|--------|-------------|--------|
|                                                                                   |   | Mar      31         |       |   | June      30        |   |       | June      30        |   |   | Sept      30        |   |   | Sept      30        |     |   | Dec      31 |   |
| 2005                                                                                   |   | US$                 |       |   | US$                 |   |       | US$                 |   |   | US$                 |   |   | US$                 |     |   | US$         |   |
|                                                                                   |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |
| Interest      income                                                                   |   |                | 14,677     |   |                |   | 19,609     |                |   |   | 34,286              |   |   |                | 77,693   |   |        |   | 111,979 |   |   |   | 462,174 |   |
|                                                                                   |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Net      earnings (loss) and    comprehensive      earnings (loss) |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | (176,847   | )      |                |   | (198,511   | )                   |   |   | (375,358            | )      |   |                | (217,348 | )      |        |   | (592,706 | ) |   |   | (480,980 | ) |
| Adjustment      - current period                                                       |   |                | (78,791    | )      |                |   | (1,187,023 | )                   |   |   | (1,265,814          | )      |   |                | (316,583 | )      |        |   | (1,582,397 | ) |   |   | (2,681,680 | ) |
| As      restated                                                                       |   |                | (255,638   | )      |                |   | (1,385,534 | )                   |   |   | (1,641,172          | )      |   |                | (533,931 | )      |        |   | (2,175,103 | ) |   |   | (3,162,660 | ) |
|                                                                                   |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Net      earnings (loss) per share    -      basic and diluted     |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | 0.00       |   |                |   | 0.00       |                |   |   | (0.01               | )      |   |                | 0.00     |   |        |   | (0.01 | ) |   |   | (0.01 | ) |
| Adjustment      - current period                                                       |   |                | (0.01      | )      |                |   | (0.03      | )                   |   |   | (0.02               | )      |   |                | (0.01    | )      |        |   | (0.03 | ) |   |   | (0.05 | ) |
| As      restated                                                                       |   |                | (0.01      | )      |                |   | (0.03      | )                   |   |   | (0.03               | )      |   |                | (0.01    | )      |        |   | (0.04 | ) |   |   | (0.06 | ) |
|                                                                                   |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Deficit                                                                                |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | (1,535,851 | )      |                |   |       |                |   |   | (1,734,362          | )      |   |                |     |   |        |   | (1,951,710 | ) |   |   | (1,839,984 | ) |
| Adjustment      - prior years                                                          |   |                | (344,684   | )      |                |   |       |                |   |   | (344,684            | )      |   |                |     |   |        |   | (344,684 | ) |   |   | (344,684 | ) |
| Adjustment      - current period                                                       |   |                | (78,791    | )      |                |   |       |                |   |   | (1,265,814          | )      |   |                |     |   |        |   | (1,582,397 | ) |   |   | (2,681,680 | ) |
| As      restated                                                                       |   |                | (1,959,326 | )      |                |   |       |                |   |   | (3,344,860          | )      |   |                |     |   |        |   | (3,878,791 | ) |   |   | (4,866,348 | ) |
|                                                                                   |   |                |       |   |                |   |       |                |   |   | )                   |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Oil      and gas interests                                                             |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | 916,506    |   |                |   | 38,742     |                |   |   | 955,248             |   |   |                | 146,809  |   |        |   | 1,102,057 |   |   |   | 1,578,124 |   |
| Adjustment      - current period                                                       |   |                | 31,153     |   |                |   | 744,651    |                |   |   | 775,804             |   |   |                | 200,732  |   |        |   | 976,536 |   |   |   | 1,672,576 |   |
| As      restated - current period                                                      |   |                | 947,659    |   |                |   | 783,393    |                |   |   | 1,731,052           |   |   |                | 347,541  |   |        |   | 2,078,593 |   |   |   | 3,250,700 |   |
| Opening      balance - beginning of year                                               |   |                | 707,023    |   |                |   |       |                |   |   | 707,023             |   |   |                |     |   |        |   | 707,023 |   |   |   | 707,023 |   |
| As      restated                                                                       |   |                | 1,654,682  |   |                |   |       |                |   |   | 2,438,075           |   |   |                |     |   |        |   | 2,785,616 |   |   |   | 3,957,723 |   |
|                                                                                   |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Stock-based      compensation                                                          |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Consulting                                                                             |   |                | --         |   |                |   | --         |                |   |   | --                  |   |   |                | --       |   |        |   | -- |   |   |   | -- |   |
| Oil      and gas interests                                                             |   |                | --         |   |                |   | --         |                |   |   | --                  |   |   |                | --       |   |        |   | -- |   |   |   | -- |   |
|                                                                                   |   |                | --         |   |                |   | --         |                |   |   | --                  |   |   |                | --       |   |        |   | -- |   |   |   | -- |   |
|                                                                                   |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Adjustment                                                                             |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Consulting                                                                             |   |                | 78,791     |   |                |   | 1,187,023  |                |   |   | 1,265,814           |   |   |                | 316,583  |   |        |   | 1,582,397 |   |   |   | 2,681,680 |   |
| Oil      and gas interests                                                             |   |                | 31,153     |   |                |   | 744,651    |                |   |   | 775,804             |   |   |                | 200,732  |   |        |   | 976,536 |   |   |   | 1,672,576 |   |
|                                                                                   |   |                | 109,944    |   |                |   | 1,931,674  |                |   |   | 2,041,618           |   |   |                | 517,315  |   |        |   | 2,558,933 |   |   |   | 4,354,256 |   |
|                                                                                   |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      restated                                                                       |   |                |       |   |                |   |       |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Consulting                                                                             |   |                | 78,791     |   |                |   | 1,187,023  |                |   |   | 1,265,814           |   |   |                | 316,583  |   |        |   | 1,582,397 |   |   |   | 2,681,680 |   |
| Oil      and gas interests                                                             |   |                | 31,153     |   |                |   | 744,651    |                |   |   | 775,804             |   |   |                | 200,732  |   |        |   | 976,536 |   |   |   | 1,672,576 |   |
|                                                                                   |   |                | 109,944    |   |                |   | 1,931,674  |                |   |   | 2,041,618           |   |   |                | 517,315  |   |        |   | 2,558,933 |   |   |   | 4,354,256 |   |

----

|                                                                                   |   | 3      months ended |       |   | 3      months ended |   |     | 6      months ended |   |   | 3      months ended |   |   | 9      months ended |     |   | Yearended   |   |
|----------------------------------------------------------------------------------------|--------|---------------------|------------|--------|---------------------|--------|----------|---------------------|--------|--------|---------------------|--------|--------|---------------------|----------|--------|-------------|--------|
|                                                                                   |   | Mar      31         |       |   | June      30        |   |     | June      30        |   |   | Sept      30        |   |   | Sept      30        |     |   | Dec      31 |   |
| 2004                                                                                   |   | US$                 |       |   | US$                 |   |     | US$                 |   |   | US$                 |   |   | US$                 |     |   | US$         |   |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |
| Interest      income                                                                   |   |                | 5,883      |   |                |   | 7,092    |                |   |   | 12,975              |   |   |                | 6,386    |   |        |   | 19,361 |   |   |   | 31,591 |   |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Net      earnings (loss) and    comprehensive      earnings (loss) |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | (201,539   | )      |                |   | (306,205 | )                   |   |   | (507,744            | )      |   |                | (163,165 | )      |        |   | (670,909 | ) |   |   | (867,496 | ) |
| Adjustment      - current period                                                       |   |                | (396,065   | )      |                |   | (240,838 | )                   |   |   | (636,903            | )      |   |                | 111,139  |   |        |   | (525,764 | ) |   |   | (304,002 | ) |
| As      restated                                                                       |   |                | (597,604   | )      |                |   | (547,043 | )                   |   |   | (1,144,647          | )      |   |                | (52,026  | )      |        |   | (1,196,673 | ) |   |   | (1,171,498 | ) |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Net      earnings (loss) per share    -      basic and diluted     |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | (0.01      | )      |                |   | (0.01    | )                   |   |   | (0.01               | )      |   |                | (0.01    | )      |        |   | (0.02 | ) |   |   | (0.02 | ) |
| Adjustment      - current period                                                       |   |                | (0.01      | )      |                |   | (0.01    | )                   |   |   | (0.02               | )      |   |                | 0.01     |   |        |   | (0.01 | ) |   |   | (0.01 | ) |
| As      restated                                                                       |   |                | (0.02      | )      |                |   | (0.02    | )                   |   |   | (0.03               | )      |   |                | 0.00     |   |        |   | (0.03 | ) |   |   | (0.03 | ) |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Deficit                                                                                |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | (693,047   | )      |                |   |     |                |   |   | (999,252            | )      |   |                |     |   |        |   | (1,162,417 | ) |   |   | (1,359,004 | ) |
| Adjustment      - prior years                                                          |   |                | (40,682    | )      |                |   |     |                |   |   | (40,682             | )      |   |                |     |   |        |   | (40,682 | ) |   |   | (40,682 | ) |
| Adjustment      - current period                                                       |   |                | (396,065   | )      |                |   |     |                |   |   | (636,903            | )      |   |                |     |   |        |   | (525,764 | ) |   |   | (304,002 | ) |
| As      restated                                                                       |   |                | (1,129,794 | )      |                |   |     |                |   |   | (1,676,837          | )      |   |                |     |   |        |   | (1,728,863 | ) |   |   | (1,703,688 | ) |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Oil      and gas interests                                                             |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                | 83,568     |   |                |   | 186,650  |                |   |   | 270,218             |   |   |                | 67,741   |   |        |   | 337,959 |   |   |   | 460,016 |   |
| Adjustment      - current period                                                       |   |                | 59,424     |   |                |   | 35,918   |                |   |   | 95,342              |   |   |                | (14,789  | )      |        |   | 80,553 |   |   |   | 46,253 |   |
| As      restated - current period                                                      |   |                | 142,992    |   |                |   | 222,568  |                |   |   | 365,560             |   |   |                | 52,952   |   |        |   | 418,512 |   |   |   | 506,269 |   |
| Opening      balance - beginning of year                                               |   |                | 200,754    |   |                |   |     |                |   |   | 200,754             |   |   |                |     |   |        |   | 200,754 |   |   |   | 200,754 |   |
| As      restated                                                                       |   |                | 343,746    |   |                |   |     |                |   |   | 566,314             |   |   |                |     |   |        |   | 619,266 |   |   |   | 707,023 |   |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Stock-based      compensation                                                          |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      previously reported                                                            |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Consulting                                                                             |   |                | --         |   |                |   | --       |                |   |   | --                  |   |   |                | --       |   |        |   | -- |   |   |   | -- |   |
| Oil      and gas interests                                                             |   |                | --         |   |                |   | --       |                |   |   | --                  |   |   |                | --       |   |        |   | -- |   |   |   | -- |   |
|                                                                                   |   |                | --         |   |                |   | --       |                |   |   | --                  |   |   |                | --       |   |        |   | -- |   |   |   | -- |   |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Adjustment                                                                             |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Consulting                                                                             |   |                | 396,065    |   |                |   | 240,838  |                |   |   | 636,903             |   |   |                | (111,139 | )      |        |   | 525,764 |   |   |   | 304,002 |   |
| Oil      and gas interests                                                             |   |                | 59,424     |   |                |   | 35,918   |                |   |   | 95,342              |   |   |                | (14,789  | )      |        |   | 80,553 |   |   |   | 46,253 |   |
|                                                                                   |   |                | 455,489    |   |                |   | 276,756  |                |   |   | 732,245             |   |   |                | (125,928 | )      |        |   | 606,317 |   |   |   | 350,255 |   |
|                                                                                   |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| As      restated                                                                       |   |                |       |   |                |   |     |                |   |   |                |   |   |                |     |   |        |   |   |   |   |   |   |   |
| Consulting                                                                             |   |                | 396,065    |   |                |   | 240,838  |                |   |   | 636,903             |   |   |                | (111,139 | )      |        |   | 525,764 |   |   |   | 304,002 |   |
| Oil      and gas interests                                                             |   |                | 59,424     |   |                |   | 35,918   |                |   |   | 95,342              |   |   |                | (14,789  | )      |        |   | 80,553 |   |   |   | 46,253 |   |
|                                                                                   |   |                | 455,489    |   |                |   | 276,756  |                |   |   | 732,245             |   |   |                | (125,928 | )      |        |   | 606,317 |   |   |   | 350,255 |   |

----

| Signature                                       |   | Title                                                               |   | Date              |
|-------------------------------------------------|--------|---------------------------------------------------------------------|--------|-------------------|
| /s/ Jean Paul RoyJean      Paul Roy             |   | President,      Chief Executive Officer and Director                |   | June      3, 2008 |
|                                            |   |                                                                |   |              |
| /s/ Allan J. KentAllan      J. Kent             |   | Executive      Vice President, Chief Financial Officer and Director |   | June      3, 2008 |
|                                            |   |                                                                |   |              |
| /s/ Brent J. PetersBrent      J. Peters         |   | Director                                                            |   | June      3, 2008 |
|                                            |   |                                                                |   |              |
| /s/ Peter R. SmithPeter      R. Smith           |   | Chairman      of the Board and Director                             |   | June      3, 2008 |
|                                            |   |                                                                |   |              |
| /s/ Michael J. HudsonMichael      J. Hudson     |   | Director                                                            |   | June      3, 2008 |
|                                            |   |                                                                |   |              |
| /s/ Dr. Avinash ChandraDr.      Avinash Chandra |   | Director                                                            |   | June      3, 2008 |

----