---

UNITED STATESSECURITIES
AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-Q

**[ x ]** Quarterly Report Pursuant to Section 13
  or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2008

or

[] 
  Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
  Act of 1934

For the transition period from _____to _____

Commission File Number: 000-51712

PARK PLACE ENERGY
CORP.(Exact name of registrant as specified in its
charter)

|Nevada                                   | 71-0971567                     
|---------------------------------------- | -------------------------------
|(State or other jurisdiction of          | (I.R.S. Employer Identification
|incorporation or organization)           | No.)                           
|                                         |                                
|Suite 300, 840-6th Avenue S.W.           |                                
|Calgary, Alberta, Canada                 | T2P 3E5                        
|(Address of principal executive offices) | (Zip Code)                     

(403) 260-5375(Registrant's telephone number,
including area code)

Indicate by checkmark whether the registrant (1) has filed all
  reports required to be filed by Section 13 or 15(d) of the Securities Exchange
  Act of 1934 during the preceding 12 months (or for such shorter period that
  the registrant was required to file such reports), and (2) has been subject
  to such filing requirements for the past 90 days. Yes [ x ]No
  []

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

|Large accelerated filer []                                                   | Accelerated filer []           
|---------------------------------------------------------------------------- | -------------------------------
|Non-accelerated filer []
      (Do not check if a smaller reporting company) | Smaller reporting company [ x ]

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

Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date.
61,815,335 as of August 11, 2008.

---

PARK PLACE ENERGY CORP.

Quarterly Report On Form 10-QFor The Quarterly
Period Ended June 30, 2008

FORWARD-LOOKING STATEMENTS

This Form 10-Q for the quarterly period ended June 30, 2008
contains forward-looking statements that involve risks and uncertainties.
Forward-looking statements in this document include, among others, statements
regarding our capital needs, business plans and expectations. Such
forward-looking statements involve assumptions, risks and uncertainties
regarding, among others, the success of our business plan, availability of
funds, government regulations, operating costs, our ability to achieve
significant revenues, our business model and other factors. Any statements
contained herein that are not statements of historical fact may be deemed to be
forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "may", "will", "should", "expect", "plan",
"intend", "anticipate", "believe", "estimate", "predict", "potential" or
"continue", the negative of such terms or other comparable terminology. In
evaluating these statements, you should consider various factors, including the
assumptions, risks and uncertainties set forth in our Annual Report on Form
10-KSB for the year ended December 31, 2007 and other reports and documents we
have filed with or furnished to the Securities and Exchange Commission. These
factors or any of them may cause our actual results to differ materially from
any forward-looking statement made in this document. While these forward-looking
statements, and any assumptions upon which they are based, are made in good
faith and reflect our current judgment regarding future events, our actual
results will likely vary, sometimes materially, from any estimates, predictions,
projections, assumptions or other future performance suggested herein. The
forward-looking statements in this document are made as of the date of this
document and we do not intend or undertake to update any of the forward-looking
statements to conform these statements to actual results, except as required by
applicable law, including the securities laws of the United States.

- 2 -

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PART I - FINANCIAL INFORMATION

|Item 1. | Financial Statements
|------- | --------------------

The following unaudited interim consolidated financial
statements of Park Place Energy Corp. are included in this Quarterly Report on
Form 10-Q:

|Description                                                                                                                                                                                               | Page
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----
|                                                                                                                                                                                                          |     
|Consolidated Balance Sheets as at June 30, 2008 and
      December 31, 2007:                                                                                                                              | 4   
|                                                                                                                                                                                                          |     
|Interim Consolidated Statements of Operations and Deficit
      for the Three and Six Months Ended June 30, 2008 and 2007 and for the
      Period from May 4, 2006 (Date of Inception) to June 30, 2008: | 5   
|                                                                                                                                                                                                          |     
|Interim Consolidated Statement of Stockholders' Equity
      from December 31, 2007 to June 30, 2008:                                                                                                     | 6   
|                                                                                                                                                                                                          |     
|Interim Consolidated Statements of Cash Flows for the Six
      Months Ended June 30, 2008 and 2007 and for the Period from May 4, 2006
      (Date of Inception) to June 30, 2008:                       | 7   
|                                                                                                                                                                                                          |     
|Notes to Interim Consolidated Financial Statements:                                                                                                                                                       | 9   

- 3 -

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|PARK PLACE ENERGY CORP.        
|-------------------------------
|                               
|BALANCE SHEET                  
|(an Exploration Stage Company) 
|(expressed in Canadian Dollars)
|(Unaudited)                    
|                               

|                                                                 |   | June 30,   |   |   | December 31, |  
|---------------------------------------------------------------- | - | ---------- | - | - | ------------ | -
|                                                                 |   | 2008       |   |   | 2007         |  
|                                                                 |   |            |   |   |              |  
|                                                                 |   |            |   |   |              |  
|ASSETS                                                           |   |            |   |   |              |  
|                                                                 |   |            |   |   |              |  
|Current                                                          |   |            |   |   |              |  
|Cash                                                             | $ | 349,108    |   | $ | 117,491      |  
|Receivable                                                       |   | 59,244     |   |   | 21,937       |  
|Prepaid expenses                                                 |   | 13,149     |   |   | 47,886       |  
|                                                                 |   |            |   |   |              |  
|Total current assets                                             |   | 421,501    |   |   | 187,314      |  
|                                                                 |   |            |   |   |              |  
|Fixed assets                                                     |   |            |   |   |              |  
|Property and equipment, net                                      |   | 2,976      |   |   | 3,414        |  
|                                                                 |   |            |   |   |              |  
|Note Receivable(Note 3)                                          |   | 244,090    |   |   | -            |  
|                                                                 |   |            |   |   |              |  
|Exploration advance                                              |   | 440,933    |   |   | 233,361      |  
|                                                                 |   |            |   |   |              |  
|Oil and gas properties(Note 4)                                   |   | 2,125,538  |   |   | 3,492,818    |  
|                                                                 |   |            |   |   |              |  
|Total assets                                                     | $ | 3,235,038  |   | $ | 3,916,907    |  
|                                                                 |   |            |   |   |              |  
|LIABILITIES AND SHAREHOLDERS'
      EQUITY                       |   |            |   |   |              |  
|                                                                 |   |            |   |   |              |  
|Current liabilities                                              |   |            |   |   |              |  
|Accounts payable and accrued
      liabilities                   | $ | 161,635    |   | $ | 128,491      |  
|Loan payable
      (Note 6)                                      |   | 35,000     |   |   | 225,000      |  
|Due to related parties (Note 9)                                  |   | 28,097     |   |   | 110,684      |  
|                                                                 |   |            |   |   |              |  
|Total current liabilities                                        |   | 224,732    |   |   | 464,175      |  
|Shareholders Equity                                              |   |            |   |   |              |  
|                                                                 |   |            |   |   |              |  
|Common stock
      (Note 7)                                      |   |            |   |   |              |  
|Authorized                                                       |   |            |   |   |              |  
|1,200,000,000 par value $0.00001                                 |   |            |   |   |              |  
|Issued and
      outstanding                                     |   |            |   |   |              |  
|60,265,335 common shares ( December 31, 2007 -
      33,000,336) |   | 603        |   |   | 330          |  
|Additional paid-in capital (Note
      7)                        |   | 10,437,185 |   |   | 7,932,363    |  
|Accumulated
      other comprehensive income                     |   | 113,805    |   |   | 114,837      |  
|Deficit accumulated during the
      exploration stage           |   | (7,541,287 | ) |   | (4,594,798   | )
|                                                                 |   |            |   |   |              |  
|Total shareholders' equity                                       |   | 3,010,306  |   |   | 3,452,732    |  
|                                                                 |   |            |   |   |              |  
|Total
      liabilities and shareholders equity                  | $ | 3,235,038  |   | $ | 3,916,907    |  

The accompanying notes are in integral part of these
consolidated financial statements.

- 4 -

---

|PARK PLACE ENERGY CORP.                                                         
|--------------------------------------------------------------------------------
|CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT AND
      COMPREHENSIVE INCOME
|(an Exploration Stage Company)                                                  
|(expressed in Canadian Dollars)                                                 
|(Unaudited)                                                                     
|                                                                                

|                                                    |   | Cumulative     |   |   |              |   |   |              |   |   |            |   |   |            |  
|--------------------------------------------------- | - | -------------- | - | - | ------------ | - | - | ------------ | - | - | ---------- | - | - | ---------- | -
|                                                    |   | Amounts        |   |   |              |   |   |              |   |   | Six        |   |   |            |  
|                                                    |   | From Inception |   |   | Three Months |   |   | Three Months |   |   | Months     |   |   | Six Months |  
|                                                    |   | (May 4, 2006)  |   |   | Ended        |   |   | Ended        |   |   | Ended      |   |   | Ended      |  
|                                                    |   | To June 30,    |   |   | June 30,     |   |   | June 30,     |   |   | June 30,   |   |   | June 30,   |  
|                                                    |   | 2008           |   |   | 2008         |   |   | 2007         |   |   | 2008       |   |   | 2007       |  
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|REVENUE                                             |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|Oil and gas                                         | $ | 581,711        |   | $ | 451,262      |   | $ | 23,902       |   | $ | 487,013    |   | $ | 23,902     |  
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|DIRECT COSTS                                        |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|Depletion                                           |   | 266,129        |   |   | 245,512      |   |   | -            |   |   | 251,236    |   |   | -          |  
|Operating expenses                                  |   | 178,163        |   |   | 135,853      |   |   | -            |   |   | 160,670    |   |   | -          |  
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|                                                    |   | 137,419        |   |   | 69,897       |   |   | 23,902       |   |   | 75,107     |   |   | 23,902     |  
|EXPENSES                                            |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|Office and general                                  |   | 348,645        |   |   | 72,088       |   |   | 124,690      |   |   | 116,475    |   |   | 179,934    |  
|Depreciation                                        |   | 872            |   |   | 220          |   |   | 6,900        |   |   | 439        |   |   | 6,900      |  
|Exploration expenses                                |   | 8,004          |   |   | 8,004        |   |   | -            |   |   | 8,004      |   |   | -          |  
|Foreign exchange gain                               |   | 99,704         |   |   | 4,344        |   |   | -            |   |   | 6,469      |   |   | -          |  
|Professional fees                                   |   | 468,362        |   |   | 101,302      |   |   | 54,837       |   |   | 127,013    |   |   | 82,791     |  
|Consulting                                          |   | 1,112,876      |   |   | 350,988      |   |   | 249,544      |   |   | 523,155    |   |   | 375,865    |  
|Investor relations                                  |   | 482,407        |   |   | 56,678       |   |   | -            |   |   | 68,298     |   |   | -          |  
|Management fees                                     |   | 492,841        |   |   | 53,714       |   |   | 60,000       |   |   | 151,974    |   |   | 120,000    |  
|Travel                                              |   | 148,628        |   |   | 12,740       |   |   | -            |   |   | 45,426     |   |   | -          |  
|Stock-based compensation                            |   | 1,827,570      |   |   | 132,048      |   |   | 125,435      |   |   | 302,866    |   |   | 132,007    |  
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|                                                    |   | (4,989,909     | ) |   | (792,126     | ) |   | (621,406     | ) |   | (1,350,120 | ) |   | (897,497   | )
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|Loss before other items and income
      taxes      |   | (4,852,490     | ) |   | (722,229     | ) |   | (597,504     | ) |   | (1,275,013 | ) |   | (873,595   | )
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|OTHER ITEMS                                         |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|Interest revenue                                    |   | 15,562         |   |   | 322          |   |   | 250          |   |   | 322        |   |   | 357        |  
|Gain (Loss) on sale of disposal of
      properties |   | (45,692        | ) |   | (45,692      | ) |   | -            |   |   | (45,692    | ) |   | -          |  
|Write off oil and gas costs                         |   | (2,908,577     | ) |   | (1,626,106   | ) |   | -            |   |   | (1,626,106 | ) |   | -          |  
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|Loss before income tax                              |   | (2,938,707     | ) |   | (1,671,476   | ) |   | (597,254     | ) |   | (1,671,476 | ) |   | (873,238   | )
|Future income tax recovery
      (expense)          |   | 291,060        |   |   | -            |   |   | 104,295      |   |   | -          |   |   | (74,780    | )
|Net loss for the period                             |   | (7,500,137     | ) |   | (2,393,705   | ) |   | (492,959     | ) |   | (2,946,489 | ) |   | (948,018   | )
|                                                    |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|OTHER COMPREHENSIVE INCOME                          |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|Foreign
      currency translation adjustment       |   | 113,805        |   |   | 29,105       |   |   | -            |   |   | 1,032      |   |   | (218,442   | )
|Comprehensive loss                                  | $ | (7,386,332     | ) | $ | (2,364,600   | ) | $ | (492,959     | ) | $ | (2,945,457 | ) | $ | (1,666,460 | )
|Basic and diluted loss per share                    |   |                |   | $ | (0.05        | ) | $ | (0.03        | ) | $ | (0.06      | ) | $ | (0.07      | )
|Weighted average number of shares                   |   |                |   |   |              |   |   |              |   |   |            |   |   |            |  
|outstanding - basic and diluted                     |   |                |   |   | 53,075,787   |   |   | 14,256,541   |   |   | 48,276,980 |   |   | 13,958,548 |  

The accompanying notes are in integral part of these
consolidated financial statements.

- 5 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|(Unaudited)                                   
|                                              

|                     |  | Common Stock |  |   |        |  |   |                  |   |   |               |   |   |            |  
|-------------------- |  | ------------ |  | - | ------ |  | - | ---------------- | - | - | ------------- | - | - | ---------- | -
|                     |  |              |  |   |        |  |   |                  |   |   | Accumulated   |   |   |            |  
|                     |  |              |  |   |        |  |   |                  |   |   | Other         |   |   |            |  
|                     |  | Number of    |  |   |        |  |   | Additional Paid- |   |   | Comprehensive |   |   |            |  
|                     |  | Shares       |  |   | Amount |  |   | In
      Capital |   |   | Income        |   |   | Deficit    |  
|                     |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|                     |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|                     |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|December 31, 2007    |  | 33,000,336   |  | $ | 330    |  | $ | 7,932,363        |   | $ | 114,837       |   | $ | (4,594,798 | )
|Issuance of common   |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|stock for cash       |  | 21,972,142   |  |   | 220    |  |   | 1,828,712        |   |   | -             |   |   | -          |  
|Issuance of common   |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|stock in             |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|settlement of debt   |  | 4,542,857    |  |   | 21     |  |   | 149,979          |   |   | -             |   |   | -          |  
|Issuance of common   |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|stock for            |  | 750,000      |  |   | 32     |  |   | 292,708          |   |   | -             |   |   | -          |  
|consulting           |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|Stock-based          |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|compensation         |  | -            |  |   | -      |  |   | 301,431          |   |   | -             |   |   | -          |  
|Shares issued as     |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|private placement    |  | -            |  |   | -      |  |   | 27,986           |   |   | -             |   |   | -          |  
|commission           |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|Share issuance costs |  | -            |  |   | -      |  |   | (95,994          | ) |   | -             |   |   | -          |  
|Cumulative           |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|translation          |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|adjustment           |  | -            |  |   | -      |  |   | -                |   |   | (1,032        | ) |   | -          |  
|Net loss             |  | -            |  |   | -      |  |   | -                |   |   | -             |   |   | (2,946,489 | )
|                     |  |              |  |   |        |  |   |                  |   |   |               |   |   |            |  
|June 30, 2008        |  | 60,265,335   |  | $ | 603    |  | $ | 10,437,185       |   | $ | 113,805       |   | $ | (7,541,287 | )

The accompanying notes are in integral part of these
consolidated financial statements.

- 6 -

---

|PARK PLACE ENERGY CORP.            
|-----------------------------------
|CONSOLIDATED STATEMENT OF CASH FLOW
|(an Exploration Stage Company)     
|(expressed in Canadian Dollars)    
|(Unaudited)                        
|                                   

|                                                 |   | Cumulative   |   |   |            |   |   |                  |  
|------------------------------------------------ | - | ------------ | - | - | ---------- | - | - | ---------------- | -
|                                                 |   | Amounts From |   |   |            |   |   |                  |  
|                                                 |   | Inception    |   |   |            |   |   |                  |  
|                                                 |   | on May 4,    |   |   | Six Months |   |   |                  |  
|                                                 |   | 2006 to      |   |   | Ended      |   |   | Six Months Ended |  
|                                                 |   | June 30,     |   |   | June 30,   |   |   | June 30,         |  
|                                                 |   | 2008         |   |   | 2008       |   |   | 2007             |  
|                                                 |   |              |   |   |            |   |   |                  |  
|CASH FLOW FROM OPERATING                         |   |              |   |   |            |   |   |                  |  
|EXPENSES                                         |   |              |   |   |            |   |   |                  |  
|Loss for the period                              | $ | (7,500,138   | ) | $ | (2,946,489 | ) | $ | (948,018         | )
|Depreciation                                     |   | 871          |   |   | 438        |   |   | -                |  
|Accretion                                        |   | (320         | ) |   | (320       | ) |   | -                |  
|Stock-based
      compensation                   |   | 1,827,570    |   |   | 302,866    |   |   | 132,007          |  
|Interest accrued on notes payable                |   | 12,530       |   |   | -          |   |   | -                |  
|Impairment of oil
      and gas                  |   | 1,626,106    |   |   | 1,626,106  |   |   | -                |  
|Consulting fees paid by issuance of              |   | 373,756      |   |   | 292,740    |   |   | -                |  
|common stock                                     |   |              |   |   |            |   |   |                  |  
|Investor relation fees paid by issuance of       |   | 58,430       |   |   | -          |   |   | -                |  
|common stock                                     |   |              |   |   |            |   |   |                  |  
|Depletion                                        |   | 266,129      |   |   | 251,236    |   |   | 6,900            |  
|Loss on disposal
      of mineral properties     |   | 137,915      |   |   | 137,915    |   |   | -                |  
|Future income tax recovery                       |   | (291,060     | ) |   | -          |   |   | 74,780           |  
|                                                 |   |              |   |   |            |   |   |                  |  
|Changes in non-cash
      working capital items: |   |              |   |   |            |   |   |                  |  
|(Increase)
      decrease in receivable          |   | (59,244      | ) |   | (37,307    | ) |   | (7,093           | )
|(Increase) decrease in prepaid expenses          |   | (13,149      | ) |   | 34,737     |   |   | (12,456          | )
|Increase
      (decrease) in accounts payable    |   |              |   |   |            |   |   |                  |  
|and accrued liabilities                          |   | 94,281       |   |   | (3,629     | ) |   | 427,485          |  
|Increase
      (decrease) in due to related      |   | 19,442       |   |   | (82,587    | ) |   | -                |  
|parties                                          |   |              |   |   |            |   |   |                  |  
|                                                 |   |              |   |   |            |   |   |                  |  
|Net cash used in
      operating activities      |   | (3,446,881   | ) |   | (424,294   | ) |   | (326,395         | )
|                                                 |   |              |   |   |            |   |   |                  |  
|CASH FLOW FROM INVESTING                         |   |              |   |   |            |   |   |                  |  
|ACTIVITIES                                       |   |              |   |   |            |   |   |                  |  
|Oil and gas interests                            |   | (3,448,735   | ) |   | (473,289   | ) |   | (133,910         | )
|Exploration advances                             |   | (440,933     | ) |   | (207,572   | ) |   | -                |  
|Mineral Properties                               |   | (381,685     | ) |   | (381,685   | ) |   | -                |  
|Loan receivable (payable)                        |   | (572,000     | ) |   | (40,000    | ) |   | (200,000         | )
|Cash acquired through
      recapitalization     |   | 320          |   |   | -          |   |   | -                |  
|Proceeds (Payments) to related parties           |   | -            |   |   | -          |   |   | (243,929         | )
|Acquisition of property
      and equipment      |   | (3,847       | ) |   | -          |   |   | -                |  
|                                                 |   |              |   |   |            |   |   |                  |  
|Net cash used in investing activities            |   | (4,846,880   | ) |   | (1,102,546 | ) |   | (577,839         | )

Continued...

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

- 7 -

---

|PARK PLACE ENERGY CORP.             
|------------------------------------
|CONSOLIDATED STATEMENT OF CASH FLOWS
|(an Exploration Stage Company)      
|(expressed in Canadian Dollars)     
|(Unaudited)                         
|                                    

|                                              |   | Cumulative   |   |   |                |   |   |                | 
|--------------------------------------------- | - | ------------ | - | - | -------------- | - | - | -------------- | 
|                                              |   | Amounts From |   |   |                |   |   |                | 
|                                              |   | Inception    |   |   |                |   |   |                | 
|                                              |   | on May 4,    |   |   |                |   |   |                | 
|                                              |   | 2006 to      |   |   | Six Months     |   |   | Six Months     | 
|                                              |   | June 30,     |   |   | Ended June 30, |   |   | Ended June 30, | 
|                                              |   | 2008         |   |   | 2008           |   |   | 2007           | 
|                                              |   |              |   |   |                |   |   |                | 
|Continued                                     |   |              |   |   |                |   |   |                | 
|                                              |   |              |   |   |                |   |   |                | 
|CASH FLOW FROM FINANCING                      |   |              |   |   |                |   |   |                | 
|ACTIVITIES                                    |   |              |   |   |                |   |   |                | 
|Proceeds from issuance
      of capital stock |   | 7,919,092    |   |   | 1,759,489      |   |   | 1,492,000      | 
|Proceeds from loans                           |   | 625,000      |   |   | -              |   |   | -              | 
|Repurchase of
      common stock              |   | (15,028      | ) |   | -              |   |   | -              | 
|                                              |   |              |   |   |                |   |   |                | 
|Net cash provided by financing activities     |   | 8,529,064    |   |   | 1,759,489      |   |   | 1,492,000      | 
|                                              |   |              |   |   |                |   |   |                | 
|                                              |   |              |   |   |                |   |   |                | 
|Effect of foreign exchange on cash            |   | 113,905      |   |   | (1,032         | ) |   | -              | 
|                                              |   |              |   |   |                |   |   |                | 
|                                              |   |              |   |   |                |   |   |                | 
|Change in cash during the period              |   | 349,108      |   |   | 231,617        |   |   | 587,766        | 
|                                              |   |              |   |   |                |   |   |                | 
|                                              |   |              |   |   |                |   |   |                | 
|Cash position, beginning of period            |   | -            |   |   | 117,491        |   |   | 4,517          | 
|                                              |   |              |   |   |                |   |   |                | 
|                                              |   |              |   |   |                |   |   |                | 
|Cash position, end of period                  | $ | 349,108      |   | $ | 349,108        |   | $ | 592,283        | 

Supplemental disclosure with respect to cash flows (Note 8)

The accompanying notes are in integral part of these
consolidated financial statements.

- 8 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   
|                                              

|1. | NATURE AND CONTINUANCE OF OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | Park Place Energy Corp., formerly ST Online Corp. (the
      "Company"), was incorporated under the laws of the State of Nevada on
      August 27, 2004. On June 22, 2007, the Company entered into a Business
      Combination Agreement with Park Place Energy Inc., a private company
      incorporated under the laws of the Province of Alberta, Canada, and
      0794403 B.C. Ltd., a British Columbia corporation and wholly-owned
      subsidiary of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | On July 6, 2007, the Company affected a forward split of
      its shares of common stock on the basis of eight new shares of common
      stock for each one share of common stock outstanding on that date and
      increased the authorized share capital from 100,000,000 shares of common
      stock to 800,000,000 shares of common stock. At the same time, the Company
      merged with a wholly-owned subsidiary, Park Place Energy Corp. which
      incorporated under the laws of the State of Nevada in contemplation of the
      acquisition of all of the issued and outstanding shares of Park Place
      Energy Inc. and the name of the Company was then changed to Park Place
      Energy Corp. On July 23, 2007, the Company effected a forward split of its
      shares of common stock on the basis of one and one-half new shares of
      common stock for each one share of common stock outstanding on that date
      and increased authorized share capital from 800,000,000 shares of common
      stock to 1,200,000,000 shares of common stock. Pursuant to the terms of
      the Business Combination Agreement, the Company issued to each shareholder
      of record of Park Place Energy Inc. at the time of the acquisition one
      share of our common stock for every two shares they held of Park Place
      Energy Inc. As a result, the Company issued 8,995,662 shares of common
      stock to the former shareholders of Park Place Energy Inc.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | On July 30, 2007, the Company acquired Park Place Energy
      Inc. and the business of the Company is now the acquisition and
      exploration of oil and gas and diamond interests. Park Place Energy Corp.
      holds exploration interests in a property in Tennessee, USA. Park Place
      Energy (Canada) Inc. holds the exploration interests in five properties in
      the provinces of British Columbia, Alberta and Saskatchewan, in Canada.
      The Company has completed test drilling at certain of the properties in
      which it holds interests. The Company is underway to develop certain of
      these properties for production. A limited amount of oil and gas is
      produced currently at one of our properties. For accounting purposes, the
      merger was treated as a recapitalization with Park Place Energy Inc. being
      the accounting acquirer and the go-forward financial statements reflect
      the history of Park Place Energy Inc. from its inception on May 4, 2006.
      The fiscal year- end of Park Place Energy Corp. was changed to December 31
      from September 30, consequently the current periods presented are for the
      three and six months ended June 30, 2008 and the comparative figures
      presented are for the period from inception on May 4, 2006 to June 30,
      2008 and for the three and six months ended June 30, 2007.                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | On November 22, 2007 a new private company, Park Place
      Energy (International) Inc. was incorporated under the laws of British
      Columbia, Canada. This company is a wholly owned subsidiary of Park Place
      Energy Corp.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | Park Place Energy Inc. was renamed to Park Place Energy
      (Canada) Inc. on September 14, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | These financial statements have been prepared on a going
      concern basis, which assumes the realization of assets and settlement of
      liabilities in the normal course of business. The Company has had a
      history of negative cash flows from operating activities. In addition, the
      Company has an accumulated deficit of $7,541,286 as of June 30, 2008.
      These considerations raise substantial doubt about the Company's ability
      to continue as a going concern. Accordingly, the Company will require
      continued financial support from its shareholders and creditors until it
      is able to generate sufficient cash flow from operations on a sustained
      basis. Although there is doubt that the Company will be successful at
      achieving these results, during the period ended June 30, 2008 the Company
      raised a total of $1,760,924 in new equity. Failure to obtain the ongoing
      support of its stockholders and creditors may make the going concern basis
      of accounting inappropriate, in which case the Company's assets and
      liabilities would need to be recognized at their                                                                                                                                                                                                                                                                                                                                  

- 9 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   

liquidation values. These financial
statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts and classification of liabilities that
might arise from this uncertainty.

|2. | SUMMARY OF SIGNIFICANT ACCOUNTING
      POLICIES
|-- | ------------------------------------------------

The accompanying unaudited financial
statements have been prepared by the Company in conformity with accounting
principles generally accepted in the United States of America applicable to
interim financial information and with the rules and regulations of the United
States Securities and Exchange Commission. Accordingly, certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed, or
omitted, pursuant to such rules and regulations. In the opinion of management,
the unaudited interim financial statements include all adjustments necessary for
the fair presentation of the results of the interim periods presented. All
adjustments are of a normal recurring nature, except as otherwise noted below.
These financial statements should be read in conjunction with the Company's
audited consolidated financial statements and notes thereto for the year ended
December 31, 2007, included in the Company's Form 10-KSB, filed April 15, 2008,
with the Securities and Exchange Commission. The results of operations for the
interim periods are not necessarily indicative of the results of operations for
any other interim period or for a full fiscal year.

Recent accounting
pronouncements

FASB Staff Position 157-2 ("FSP FAS
157-2") delayed the effective date of FAS 157 until fiscal years beginning after
November 15, 2008, and interim periods within those fiscal years, for all
non-financial assets and non-financial liabilities, except for items that are
recognized or disclosed at fair value in the financial statements on a recurring
basis (at least annually). The Company adopted FAS 157 on January 1, 2008, and
unutilized the one year deferral for non-financial assets and non-financial
liabilities that was granted by FAP FAS 157-2. The adoption of FAS 157 did not
have a material impact on the Company's consolidated financial statements.

In February, 2007, the FASB issued SFAS
No. 159 "The Fair Value Option for Financial Assets and Financial Liabilities".
SFAS No. 159 permits entities to choose to measure many financial assets and
financial liabilities at fair value. Unrealized gains and losses on items for
which the fair value option has been elected are reported in earning. SFAS No.
159 is effective for fiscal years beginning after November 15, 2007. The
adoption on FAS 159 did not have a material impact on the Company's consolidated
financial statements.

In March 2008, the FASB issued FAS No.
161, "Disclosures about Derivative Instruments and Hedging Activities" ("FAS
161"). FAS 161 changes the disclosure requirements for derivative instruments
and hedging activities by requiring enhanced disclosures about how and why an
entity uses derivative instruments, how derivative instruments and related
hedged items are accounted for under FAS 133, and how derivative instruments and
related hedged items affect an entity's operating results, financial position,
and cash flows. The Company is currently reviewing the provision of FAS 161 and
has not yet adopted the statement. However, as the provision of FAS 161 are only
related to disclosure of derivative and hedging activities, the Company does not
believe the adoption of FAS 161 will have a material impact on its consolidated
operating results, financial position or cash flows.

In May 2008, the FASB issued SFAS No.
162, "The Hierarchy of Generally Accepted Accounting Principles". SFAS 162
identifies the sources of accounting principles and the framework for selecting
the principles to be used in the preparation of financial statements of
nongovernmental entities that are presented in conformity with generally
accepted accounting principles in the United States. It is effective 60 days
following the SEC's approval of the Public Company Accounting Oversight Board
amendments to AU Section 411, "The Meaning of Present Fairly in Conformity With
Generally Accepted Accounting

- 10 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   

Principles". The adoption of this
statement is not expected to have a material effect on the Company's financial
statements.

In May 2008, the Financial Accounting
Standards Board ("FASB") issued SFAS No. 163, "Accounting for Financial
Guarantee Insurance Contracts - An interpretation of FASB Statement No. 60".
SFAS 163 requires that an insurance enterprise recognize a claim liability prior
to an event of default when there is evidence that credit deterioration has
occurred in an insured financial obligation. It also clarifies how Statement 60
applies to financial guarantee insurance contracts, including the recognition
and measurement to be used to account for premium revenue and claim liabilities,
and requires expanded disclosures about financial guarantee insurance contracts.
It is effective for financial statements issued for fiscal years beginning after
December 15, 2008, except for some disclosures about the insurance enterprise's
risk-management activities. SFAS 163 requires that disclosures about the
risk-management activities of the insurance enterprise be effective for the
first period beginning after issuance. Except for those disclosures, earlier
application is not permitted. The adoption of this statement is not expected to
have a material effect on the Company's financial statements.

|3. | NOTE RECEIVABLE
|-- | ---------------

On June 26, 2008, the Company received
a promissory note in the amount of US$385,000 in consideration for the sale of
the Company's interest in the mineral property described in Note 5. The note is
non-interest bearing, unsecured and due on June 26, 2013. The issuer is to repay
the promissory note with 20% of the net proceeds from any diamonds sold from the
property or 20% of the proceeds from the sale of the interest in the properties.
The Company recognized a discount of $145,945 at an effective rate of 10%.
During the six month period ended June 30, 2008, the Company recorded
amortization of the discount of $320 as interest revenue.

|4. | OIL AND GAS PROPERTIES
|-- | ----------------------

The Company entered into agreements to
acquire interests in various oil and gas properties in Canada and the United
States as follows:

| |                                      |   |           | 
| | ------------------------------------ | - | --------- | 
| |                                      |   | As at     | 
| |                                      |   | June 30,  | 
| |                                      |   | 2008      | 
| |                                      |   |           | 
| | OIL AND GAS INTERESTS                |   |           | 
| |                                      |   |           | 
| | Proven Properties                    |   |           | 
| | Canada                               | $ | 1,336,706 | 
| | USA                                  |   | -         | 
| |                                      |   |           | 
| | Total Proven Properties              | $ | 1,336,706 | 
| |                                      |   |           | 
| | Unproven Properties                  |   |           | 
| | Canada                               | $ | 256,252   | 
| | USA                                  |   | 532,580   | 
| |                                      |   |           | 
| | Total Unproved Properties            | $ | 788,832   | 
| |                                      |   |           | 
| | Total Proven and Unproved Properties | $ | 2,125,538 | 

- 11 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   

|5. | MINERAL PROPERTIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | In February, 2008, the Company entered into a purchase
      and sale agreement with a third party pursuant to which the Company
      acquired a 51% interest in five diamond concessions in the state of Goias,
      Brazil for $250,000. An additional $12,184 has been spent on acquisition
      of a 51% interest in a sixth diamond concession offsetting the other
      concessions. In June, 2008, the Company sold its 51% interest in the six
      diamond concessions in consideration for a US$385,000 promissory note
      described in Note 3. The Company recognized a loss of $138,936 on the sale
      of the concessions.                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|6. | LOAN PAYABLE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | The Company entered into a loan agreement with an arms
      length third party in the amount of $225,000 on December 28, 2007. The
      associated Demand Promissory Note does not contain any interest and the
      holder has the option to convert the loan in to common shares of the
      Company.                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | The Company converted $150,000 out of a total $225,000 to
      2,142,857 units at a price of $0.07 per unit on March 3, 2008. Each unit
      consisted of one common stock of the company and one share purchase
      warrant. Each warrant entitles the holder to purchase one share at an
      exercise price of $0.10 per share in the first year and at an exercise
      price of $0.15 per share in the second year. During the six month period
      ended June 30, 2008, the Company repaid $40,000 reducing the amount
      outstanding to $35,000.                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|7. | COMMON STOCK                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | The Company's Articles Of Incorporation provide for the
      issuance of up to 1,200,000,000 shares of common stock, par value
      $0.00001. Effective July 6, 2007 the Company implemented a stock split of
      its common stock by issuing eight new shares for every one old share.
      Effective July 23, 2007 the Company implemented a further a stock split of
      its common stock by issuing one and a half new shares for every old share.
      Except as otherwise stated to the contrary in these financial statements,
      all references to shares and prices per shares have been adjusted to give
      retroactive effect to the stock splits.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | On February 13, 2008, the Company issued 4,435,714 shares
      of common stock at a price of US$0.07 for gross proceeds of
    US$310,500.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | On February 20, 2008, the Company issued 750,000 shares
      of common stock as a settlement of debt to an arms length third party at a
      price of US$0.10 for gross proceeds of US$75,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | On February 29, 2008, the Company issued 8,536,428 shares
      of common stock at a price of US$0.07 for gross proceeds of
    US$597,550.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | On March 3, 2008, the Company issued 2,142,857 shares of
      common stock as a settlement of debt to an arms length party at a price of
      $0.07 for gross proceeds of $150,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | In April, 2008, the Company issued 9,000,000 units at a
      price of US$0.10 per unit for total proceeds of US$900,000. Each unit
      consisted of one common share and one share purchase warrant entitling the
      holder to purchase a common share up to 1 year at a price of US$0.20. The
      Company paid a Finder's Fee of $45,000 and issued Finder's Warrants with a
      fair value of $27,986 to acquire 450,000 common shares of the Company at
      $0.10 for one year.                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | On June 16, 2008, the Company issued 2,400,000 shares of
      common stock at a price of US$0.09 to settle all obligations with a
      consultant pursuant to a Consulting Agreement between a consultant and the
      Company for gross proceeds of $216,000.                                                                                                                                                                                                                                                                                                                                                                                                          

- 12 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   

Stock Options

The Company adopted an incentive Stock
Option plan as at October 11, 2007 whereby the total number of authorized
options to be granted is up to total of 6,000,000 Common Shares. Under the plan,
the exercise price of each option shall not be less that the market price of the
Company's stock as calculated immediately preceding the day of the grant. The
vesting schedule for each option shall be specified by the Company at the time
of grant.

On January 29, 2008 all outstanding
stock options (3,160,000) were repriced to US$0.15.

As at June 30, 2008, the Company had
outstanding stock options, enabling the holders to acquire further common shares
as follows:

| |                             |  |                  |  |  |          |  |  |                          | 
| | --------------------------- |  | ---------------- |  |  | -------- |  |  | ------------------------ | 
| |                             |  |                  |  |  | Exercise |  |  |                          | 
| |                             |  | Number           |  |  | Price    |  |  |                          | 
| |                             |  | of
      Options |  |  | (US$)    |  |  | Expiry Date              | 
| |                             |  |                  |  |  |          |  |  |                          | 
| |                             |  | 350,000          |  |  | 0.15     |  |  | April 2, 2011            | 
| |                             |  | 100,000          |  |  | 0.15     |  |  | April 4, 2011            | 
| |                             |  | 125,000          |  |  | 0.15     |  |  | May 15, 2010             | 
| |                             |  | 125,000          |  |  | 0.15     |  |  | May 15, 2010             | 
| |                             |  | 200,000          |  |  | 0.15     |  |  | August 13, 2008          | 
| |                             |  | 120,000          |  |  | 0.15     |  |  | August 13, 2012          | 
| |                             |  | 100,000          |  |  | 0.15     |  |  | September 11,
      2008 | 
| |                             |  | 340,000          |  |  | 0.15     |  |  | September 25, 2009       | 
| |                             |  | 150,000          |  |  | 0.15     |  |  | October 11, 2009         | 
| |                             |  | 200,000          |  |  | 0.15     |  |  | November 16, 2009        | 
| |                             |  | 400,000          |  |  | 0.15     |  |  | November 16, 2008        | 
| |                             |  | 100,000          |  |  | 0.15     |  |  | December 1, 2008         | 
| |                             |  | 100,000          |  |  | 0.15     |  |  | December 16, 2009        | 
| |                             |  | 100,000          |  |  | 0.15     |  |  | February 11, 2010        | 
| |                             |  | 250,000          |  |  | 0.15     |  |  | February 21, 2010        | 
| |                             |  | 250,000          |  |  | 0.15     |  |  | April 21, 2010           | 
| |                             |  | 50,000           |  |  | 0.10     |  |  | June 19, 2009            | 
| |                             |  | 1,790,000        |  |  | 0.10     |  |  | June 19, 2010            | 
| | Balance as of June 30, 2008 |  | 4,850,000        |  |  |          |  |  |                          | 

During the six month period ended June
30, 2008, various consultants, directors and officers ceased to work for the
Company and pursuant to their stock option agreements, their stock options
subsequently expired. Refer to Note 13.

- 13 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   

Stock option transactions are
summarized as follows:

| |                                           |  |               |   |   |                   | 
| | ----------------------------------------- |  | ------------- | - | - | ----------------- | 
| |                                           |  | June 30, 2008 |   |   | December 31, 2007 | 
| |                                           |  |               |   |   | Weighted          | 
| |                                           |  |               |   |   | Average           | 
| |                                           |  |               |   |   | Exercise          | 
| |                                           |  | Number of     |   |   | Price             | 
| |                                           |  | Options       |   |   | (US$)             | 
| | Balance, beginning of period (post split) |  | 3,160,000     |   | $ | 0.76              | 
| | Granted                                   |  | 2,440,000     |   |   | 0.11              | 
| | Expired / cancelled                       |  | (750,000      | ) |   | 0.15              | 
| | Balance, end of
      period              |  | 4,850,000     |   | $ | 0.13              | 
| | Options exercisable, end of period        |  | 4,850,000     |   | $ | 0.13              | 

Options - Stock-Based
Compensation

As of June 30, 2008, the Company
granted incentive stock options in accordance with its share option plan to
directors and officers with an estimated fair value of $161,781. An additional
$139,650 was recorded due to the re-pricing of the options.

The following weighted-average
assumptions were used for the Black-Scholes valuation of stock options granted
during the noted period:

| |                          |  |         | 
| | ------------------------ |  | ------- | 
| |                          |  | 2008    | 
| |                          |  |         | 
| | Risk-free interest rate  |  | 3.31%   | 
| | Expected life of options |  | 2 years | 
| | Annualized volatility    |  | 134.09% | 
| | Dividend rate            |  | 0.00%   | 

The weighted fair value of options
granted was $0.07.

Warrants

| |                            |  |            |  |  |              |  |  |              | 
| | -------------------------- |  | ---------- |  |  | ------------ |  |  | ------------ | 
| |                            |  |            |  |  | US$ Exercise |  |  | US$ Exercise | 
| |                            |  | Number of  |  |  | Price        |  |  | Price        | 
| |                            |  | Warrants   |  |  | First Year   |  |  | Second Year  | 
| |                            |  |            |  |  |              |  |  |              | 
| | Balance, December 31, 2007 |  | 7,356,914  |  |  | US$ 0.50     |  |  | US$ 0.75     | 
| |                            |  |            |  |  |              |  |  |              | 
| | February 13, 2008          |  | 4,435,714  |  |  | US$ 0.10     |  |  | US$ 0.15     | 
| | February 29, 2008          |  | 8,536,428  |  |  | US$ 0.10     |  |  | US$ 0.15     | 
| | March 3, 2008              |  | 2,142,857  |  |  | CAD$ 0.10    |  |  | CAD$ 0.15    | 
| | April 2, 2008              |  | 7,500,000  |  |  | US$ 0.20     |  |  | -            | 
| | April 2, 2008              |  | 1,500,000  |  |  | US$ 0.20     |  |  | -            | 
| | May 20, 2008               |  | 450,000    |  |  | US$ 0.10     |  |  | -            | 
| | Balance, June 30, 2008     |  | 31,921,913 |  |  |              |  |  |              | 

- 14 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   

|8. | SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH
      FLOWS
|-- | --------------------------------------------------------

| |                                              |   |            |  |   |            | 
| | -------------------------------------------- | - | ---------- |  | - | ---------- | 
| |                                              |   | Six months |  |   | Six months | 
| |                                              |   | Ended      |  |   | Ended      | 
| |                                              |   | June 30,   |  |   | June 30,   | 
| |                                              |   | 2008       |  |   | 2007       | 
| |                                              |   |            |  |   |            | 
| | Cash paid during the period for interest     | $ | -          |  | $ | -          | 
| |                                              |   |            |  |   |            | 
| | Cash paid during the period for income taxes | $ | -          |  | $ | -          | 

Significant non-cash transactions
during the six month period ended June 30, 2008 included:

| | a) | Included in accounts payable and accrued liabilities is
      $36,773 related to oil and gas expenditures.                                                                                            
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                       
| | b) | During the six month period ended the Company sold its
      interest in a mineral property for a US$385,000 note receivable.                                                                         
| |    |                                                                                                                                                                                                       
| | c) | During the six month period ended June 30, 2008, the
      Company issued 2,142,857 common shares at a price of $0.07 per share for
      settlement of an outstanding debt in the amount of $150,000.
| |    |                                                                                                                                                                                                       
| | d) | During the six month period ended June 30, 2008, the
      Company issued 750,000 common shares for consulting services of
      US$75,000.                                                           
| |    |                                                                                                                                                                                                       
| | e) | During the six month period ended June 30, 2008, the
      Company issued 2,400,000 common shares with a fair value of $216,000 to
      pursuant to a consulting agreement.                          

There were no significant non-cash
transactions for the six month period ended June 30, 2007.

|9.  | RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | During the six month period ended June 30, 2008 the
      Company entered into the following transactions with related
    parties:                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | The Company amended the management agreement dated
      January 1, 2007 with the Chairman who was paid $20,000 per month as part
      of the remuneration for his duties. The agreement is for a three-year
      period ended December 31, 2010. Effective as of April 1, 2008, the
      Chairman now receives $10,000 per month for services rendered. On May 14,
      2008, the Chairman resigned.                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | The Company paid or accrued management fees of $90,000 to
      the former Chairman and paid or accrued management fees of $52,500 to the
      former President & CEO of the Company. Also included in due to related
      parties as of June 30, 2008 is $28,097 that is owing to the former
      Chairman of the Company and a company related to the former Chairman for
      payment of expenses on behalf of the Company. The amount is unsecured,
      non-interest bearing, and has no specific terms of repayment.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | Related party transactions are in the normal course of
      operations, occurring on terms and conditions that are similar to those of
      transactions with unrelated parties and, therefore, are measured at the
      exchange amount.                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10. | SEGMENTED INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | The Company's operations are in the resource industry in
      Canada and the United States.                                                                                                                                                                                                                                                                                                                                                                                                                                   

- 15 -

---

|PARK PLACE ENERGY CORP.                       
|----------------------------------------------
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
|(an Exploration Stage Company)                
|(expressed in Canadian Dollars)               
|AS AT JUNE 30, 2008                           
|(Unaudited)                                   

Geographical information is as
follows:

| |                        |   |           | 
| | ---------------------- | - | --------- | 
| |                        |   | June 30,  | 
| |                        |   | 2008      | 
| |                        |   |           | 
| | Oil and gas properties |   |           | 
| | Canada                 | $ | 1,655,195 | 
| | United States          |   | 470,343   | 
| |                        |   |           | 
| |                        | $ | 2,125,538 | 

All of the Company's oil and gas
revenues are in Canada.

|11. | FINANCIAL INSTRUMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | The Company's financial instruments consist of cash,
      receivable, accounts payable and accrued liabilities, loan payable and due
      to related parties. Unless otherwise noted, it is management's opinion
      that the Company is not exposed to significant interest, currency or
      credit risks arising from these financial instruments. The fair value of
      these financial instruments approximates their carrying value, unless
      otherwise noted.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|12. | COMMITMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | On June 19, 2008, the Company entered into a consulting
      agreement with a consultant who will receive CAD$4,000 per month and
      50,000 options exercisable at $0.10 per share for 1 year
  (granted).                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|13. | SUBSEQUENT EVENT                                                                                                                                                                                                                                                                                                                                                                                                                                                               

Subsequent to June 30, 2008, pursuant
to the stock option agreements of various consultants, officers and directors,
1,250,000 options with an exercise price of US$0.15 and expiration dates between
September 25, 2009, and November 16, 2012, expired thirty days after they ceased
working for the Company.

- 16 -

---

|Item 2. | Management's Discussion and Analysis
|------- | ------------------------------------

As used in this quarterly report: (i) the terms "we", "us",
"our" and the "Company" mean Park Place Energy Corp.; (ii) "SEC" refers to the
Securities and Exchange Commission; (iii) "Exchange Act" refers to the United
States Securities Exchange Act of 1934, as amended; (iv) "Securities Act" refers
to the United States Securities Act of 1933, as amended; and (v) all dollar
amounts are in Canadian dollars unless otherwise indicated.

The following discussion of our plan of operations, results of
operations and financial condition as at and for the six months ended June 30,
2008 should be read in conjunction with: (i) our unaudited interim consolidated
financial statements and related notes for the six months ended June 30, 2008
included in this Quarterly Report; and (ii) our Annual Report on Form 10-KSB for
the year ended December 31, 2007, including our annual audited financial
statements set forth therein.

Overview

General

Prior to our acquisition of Park Place Energy Inc. ("Park Place
Canada") in July 2007, we operated an e-commerce website. However, this business
did not progress as anticipated and we determined to pursue other
opportunities.

On July 30, 2007, we completed the acquisition of all of the
issued and outstanding shares of Park Place Canada, which was engaged in the
exploration for oil and natural gas. In addition, pursuant to the terms of the
acquisition, we disposed of our interest in and to the e-commerce website and
acquired the shares of our common stock held by certain former officers and
directors of our company.

For more information relating to the acquisition and related
reorganization, see our Annual Report on Form 10-KSB for the year ended December
31, 2007 filed with the SEC on April 15, 2008.

The closing of the acquisition of Park Place Canada represented
a change in control of our Company. For accounting purposes, this change in
control constitutes a re-capitalization of the Company, and the acquisition has
been accounted for as a reverse merger whereby we, as the legal acquirer, are
treated as the acquired entity, and Park Place Canada, as the legal subsidiary,
is treated as the acquiring company with the continuing operations.

Our Business

As a result of the acquisition, we are an exploration stage company
  engaged in the exploration for conventional oil and natural gas. In the projects
  in which we hold interests, another party typically acts as the operator of
  the project and we provide to the operator timely funding for our proportionate
  share of costs, as well as technical input on best developing the related property.
  To control our overhead, we engage the services of consultants who have technical
  expertise to best represent our interests. We currently hold interests in oil
  and gas properties in the Provinces of British Columbia and Alberta, Canada
  and in Morgan County, Tennessee.

- 17 -

---

In March 2008, we acquired a 51% interest in six diamond
concessions in Central Brazil in exchange for the payment of $262,184. On July
10, 2008, we divested our entire 51% interest in these concessions for $385,000
by way of a promissory note.

Revenues are currently being generated from our Eight Mile Gas
Property in Northeast British Columbia. We continue to work on developing our
other properties as well identifying new properties for acquisition.

For more information regarding our business, see our Annual
Report on Form 10-KSB filed with the SEC on April 15, 2008.

Plan Of Operations

Overview

Our Plan Of Operations for the next 12 months is to concentrate
on three projects: developing our Eight Mile Property in British Columbia,
Canada for production; completing test wells on our Tennessee property; and
advancing our interest in the recently acquired shale gas property in Alberta,
Canada.

Over the next 12 months, we plan to conduct the following: (i)
on the Eight Mile Property in British Columbia, we expect to drill two to four
more wells at an estimated net expense of $900,000 per well; (ii) on the Morgan
Highpoint Project in Tennessee, we expect to complete wells at an estimated net
expense of $250,000; and (iii). Further, we expect to spend approximately
$250,000 in the next 12 months in office and general expenses, as well as
approximately $800,000 in professional, consulting and management fees.

Estimated Capital Costs

Based on the foregoing, we anticipate that we will require
approximately $4,780,000 to pursue our Plan Of Operations over the next 12
months. We had cash of $349,108 and working capital of $196,769 as at June 30,
2008. Consequently we will require additional financing to pursue our Plan Of
Operations over the next 12 months. There can be no assurance that we will
obtain any additional financing in the amounts required or on terms favorable to
us. If we are unable to obtain additional financing, we may have to re-evaluate
or abandon our business activities and revise our Plan Of Operations.

We believe that debt financing will not be an alternative for
  funding as we do not have any significant tangible assets to secure any debt
  financing. We anticipate that additional funding will be in the form of equity
  financing from the sale of our common stock. However, we cannot provide investors
  with any assurance that we will be able to raise sufficient funding from the
  sale of our common stock to fund our plan of operations going forward. In the
  absence of such financing, our business plan will fail. Even if we are successful
  in obtaining equity financing, there is no assurance that we will obtain the
  funding necessary to pursue our business plan. If we do not continue to obtain
  additional financing going forward, we will be forced to re-evaluate or abandon
  our plan of operations.

- 18 -

---

Result of Operations

Six Months Ended June 30, 2008 Compared to the Six Months
Ended June 30, 2007

The following table sets out our net loss for the periods
indicated:

|                               |   | Six Months Ended |  |   | Six Months Ended | 
|------------------------------ | - | ---------------- |  | - | ---------------- | 
|                               |   | June 30, 2008    |  |   | June 30, 2007    | 
|                               |   | (Unaudited)      |  |   | (Unaudited)      | 
|Oil and Gas Revenue            | $ | 487,013          |  | $ | 23,902           | 
|Direct Costs                   |   |                  |  |   |                  | 
|Depletion                      |   | 251,236          |  |   | ---              | 
|Operating expenses             |   | 160,670          |  |   | ---              | 
|Expenses                       |   |                  |  |   |                  | 
|Office and general             |   | 116,475          |  |   | 179,934          | 
|Depreciation                   |   | 439              |  |   | 6,900            | 
|Exploration expenses           |   | 8,004            |  |   | ---              | 
|Foreign exchange gain          |   | 6,469            |  |   | ---              | 
|Professional fees              |   | 127,013          |  |   | 82,791           | 
|Consulting                     |   | 523,155          |  |   | 375,865          | 
|Investor relations             |   | 68,298           |  |   | ---              | 
|Management fees                |   | 151,974          |  |   | 120,000          | 
|Travel                         |   | 45,426           |  |   | ---              | 
|Stock-based
      compensation |   | 302,866          |  |   | 132,007          | 
|Net Loss                       |   | 2,946,489        |  |   | 948,016          | 

Oil and Gas Revenue

Our oil and gas revenue for the six month period ended June 30,
2008 was CDN$487,013, compared to $23,902 for the prior period of 2007. This
revenue results from production at our Kerrobert Property, which is immaterial
to our overall exploration operations. This revenue is offset by direct costs of
CDN$251,236 in depletion and CDN$160,670 in operating expenses for the six month
period ended June 30, 2008, compared to $Nil in the prior period of 2007.

Office and General Expenses

Our office and general expenses decreased to CDN$116,475 for
the six months ended June 30, 2008 from CDN$179,934 for the prior period of 2007
as a result of operating efficiencies.

- 19 -

---

Exploration Expenses

In the six months ended June 30, 2008, we incurred exploration
expenses of $8,004, compared to $Nil in the prior period of 2007, relating to
our properties.

Foreign Exchange Gain

In the six months ended June 30, 2008, we realized a foreign
exchange gain of CDN$6,469, compared to $Nil for the prior period of 2007. This
increase is the result of currency fluctuations among the Canadian dollar, the
United States dollar and the British pound and our increased business activities
in the United Kingdom.

Professional Fees

Our professional fees increased to CDN$127,013 for the six
months ended June 30, 2008 from CDN$82,791 for the prior period of 2007 as a
result of increased business activity.

Consulting Expenses

Our consulting expenses increased to CDN$523,155 for the six
months ended June 30, 2008 from CDN$375,865 for the prior period of 2007 as a
result of increased business activity.

Investor Relations Expenses

Our investor relations expense for the six months ended June
30, 2008 was $68,298 compared to $Nil for the prior period of 2007, due to
increased financing activities and growth of our investor base.

Management Fees

Our management fees increased to CDN$151,974 for the six months
ended June 30, 2008 from CDN$120,000 for the prior period of 2007 as a result of
increased business activity.

Travel Expenses

Our travel expenses increased to CDN$45,426 for the six months
ended June 30, 2008 from $Nil for the prior period of 2007 as a result of a
increased business activity requiring travel for our management and
consultants.

Stock-Based Compensation Expenses

Our stock-based compensation expenses increased to CDN$302,866
for the six months ended June 30, 2008 from $132,007 for the prior period of
2007 as a result of increased business activity requiring significantly more
work by our consultants.

Net Loss

As a result of the above, our net loss for the six months ended
June 30, 2008 was CDN$2,946,489 compared to CDN$948,018 for the prior period of
2007.

- 20 -

---

Liquidity and Capital Resources

|                          |   | As at         |  |   | As at             |  
|------------------------- | - | ------------- |  | - | ----------------- | -
|                          |   | June 30, 2008 |  |   | December 31, 2007 |  
|                          |   | (Unaudited)   |  |   | (Audited)         |  
|                          |   |               |  |   |                   |  
|Cash                      | $ | 349,108       |  | $ | 117,491           |  
|Working capital (deficit) |   | 196,769       |  |   | (276,861          | )
|Total assets              |   | 3,235,038     |  |   | 3,916,907         |  
|Total liabilities         |   | 224,732       |  |   | 464,175           |  
|Shareholders' equity      |   | 3,010,306     |  |   | 3,452,732         |  

We anticipate that we will require approximately $4,780,000 to
pursue our plan of operations over the next 12 months. We had cash of $349,108
and working capital of $196,769 as at June 30, 2008. We will require additional
financing to pursue our plan of operations over the next 12 months. There can be
no assurance that we will obtain any additional financing in the amounts
required or on terms favorable to us. If we are unable to obtain additional
financing, we may have to re-evaluate or abandon our business activities and
plan of operations.

Cash Used in Operating Activities

Cash used in operating activities in the six months ended June
30, 2008 increased to CDN$424,294 from CDN$326,395 in the prior period of 2007,
due to increased operations.

Cash Used In Investing Activities

Cash used in investing activities in the six months ended June
30, 2008 was CDN$1,102,546, compared to CDN$577,839 in the prior period of 2007.
These represent investments in our oil and gas properties and loans to another
oil and gas exploration company.

Cash Provided By Financing Activities

We have funded our business to date primarily from sales of our
common stock. In the six months ended June 30, 2008, we received cash of
CDN$1,759,489 as a result of proceeds from the sale of our capital stock,
compared to CDN$1,492,000 in the prior period of 2007.

Going Concern

As shown in the accompanying financial statements, we have
incurred significant losses since inception and have not generated any revenues
to date. The future of our company is dependent upon our ability to obtain
sufficient financing and upon achieving future profitable operations. These
factors, among others, raise substantial doubt about our company's ability to
continue as a going concern. The accompanying consolidated financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.

- 21 -

---

Future Financings

We anticipate continuing to rely on equity sales of our common
shares in order to continue to fund our business operations. Issuances of
additional shares will result in dilution to our existing shareholders. There is
no assurance that we will achieve any additional sales of our equity securities
or arrange for debt or other financing to fund our business plan.

Critical Accounting Policies

Our financial statements are impacted by the accounting
policies used and the estimates and assumptions made by management during their
preparation. A complete summary of these policies is included in Note 2 of the
notes to our historical financial statements for the year ended December 31,
2007.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on our financial condition,
changes in financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures or capital resources that are material to
investors.

|Item 3. | Quantitative and Qualitative Disclosure
      About Market Risk
|------- | ---------------------------------------------------------------

Not Applicable.

|Item 4. | Controls And Procedures
|------- | -----------------------

As required by Rule 13a-15 under the Exchange Act, we carried
out an evaluation of the effectiveness of the design and operation of our
disclosure controls and procedures as of June 30, 2008, being the date of our
most recently completed quarter. This evaluation was carried out under the
supervision and with the participation of our Chief Executive Officer and
Principal Accounting Officer. Based upon that evaluation, our Chief Executive
Officer and Principal Accounting Officer concluded that our disclosure controls
and procedures are effective to ensure that information required to be disclosed
by us in the reports that we file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified by the
rules and forms of the SEC.

Disclosure controls and procedures are controls and other
procedures that are designed to ensure that information required to be disclosed
in our reports filed or submitted under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the SEC's rules
and forms. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be
disclosed in our reports filed under the Exchange Act is accumulated and
communicated to management, including our Principal Executive Officer and our
Principal Accounting Officer, to allow timely decisions regarding required
disclosure. However, a control system, no matter how well conceived and
operated, can provide only reasonable, but not absolute, assurance that the
objectives of the control system are met.

- 22 -

---

During the fiscal quarter ended June 30, 2008, there were no
changes in our internal control over financial reporting that have materially
affected, or are reasonably likely to affect, our internal control over
financial reporting.

- 23 -

---

PART II - OTHER INFORMATION

|Item 1. | Legal Proceedings
|------- | -----------------

We currently are not a party to any material legal proceedings
and, to our knowledge, no such proceedings are threatened or contemplated.

|Item 1A. | Risk Factors
|-------- | ------------

Not Applicable.

|Item 2. | Unregistered Sales of Equity Securities
|------- | ---------------------------------------

Previously disclosed in filings with the SEC.

|Item 3. | Defaults Upon Senior Securities
|------- | -------------------------------

None.

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

None.

|Item 5. | Other Information
|------- | -----------------

None.

|Item 6. | Exhibits
|------- | --------

The following exhibits are included with this Quarterly Report
on Form 10-Q:

|Exhibit |                                                                                                                                                                                                                                                          
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibit                                                                                                                                                                                                                                   
|        |                                                                                                                                                                                                                                                          
|3.1     | Articles of Incorporation, as amended. Incorporated by
      reference to our Current Report on Form 8-K/A filed on August 8, 2007.                                                                                                                      
|        |                                                                                                                                                                                                                                                          
|3.2     | Bylaws. Incorporated by reference to our Registration
      Statement on Form SB-2 filed December 9, 2004.                                                                                                                                               
|        |                                                                                                                                                                                                                                                          
|10.1    | Amending Agreement to Business Combination Agreement
      among ST Online Corp., Park Place Energy Inc. and 0794403 B.C. Ltd dated
      effective July 4, 2007. Incorporated by reference to our Current Report on
      Form 8-K filed July 19, 2007. 
|        |                                                                                                                                                                                                                                                          
|10.2    | Amending Agreement to Business Combination Agreement
      among ST Online Corp., Park Place Energy Inc. and 0794403 B.C. Ltd dated
      effective July 18, 2007. Incorporated by reference to our Current Report
      on Form 8-K filed July 19, 2007.

- 24 -

---

|Exhibit |                                                                                                                                                                                                                                                                                                                     
|------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibit                                                                                                                                                                                                                                                                                              
|        |                                                                                                                                                                                                                                                                                                                     
|10.3    | Reorganization
        Asset and Share Purchase and Sale Agreement, dated effective July 30,
        2007, among Park Place Energy Corp., Scott Pedersen, David Stadnyk and
        Elena Avdasseva. Incorporated by reference to our Current Report on Form
        8-K filed August 14, 2007.                     
|        |                                                                                                                                                                                                                                                                                                                     
|10.4    | Loan Agreement
        dated August 8, 2007 between Park Place Energy Inc. and Great Northern
        Oil Sands Inc. Incorporated by reference to our Current Report on Form
        8-K filed August 14, 2007.                                                                                                     
|        |                                                                                                                                                                                                                                                                                                                     
|10.5    | Debt Settlement
        Agreement, dated August 9, 2007 among Park Place Energy Corp., Park Place
        Energy Inc. and 1284810 Alberta Ltd. Incorporated by reference to our
        Current Report on Form 8-K filed August 14, 2007.                                                                           
|        |                                                                                                                                                                                                                                                                                                                     
|10.6    | Amended and Restated
        Reorganization Asset and Share Purchase and Sale Agreement, dated effective
        July 30, 2007, among Park Place Energy Corp., Scott Pedersen, David Stadnyk
        and Elena Avdasseva. Incorporated by reference to our Current Report on
        Form 8-K filed August 17, 2007.
|        |                                                                                                                                                                                                                                                                                                                     
|31.1    | Rule
        13a-14(a)/15(d)-14(a) Certification of Principal Executive Officer and
        Principal Financial Officer.                                                                                                                                                                                            
|        |                                                                                                                                                                                                                                                                                                                     
|32.1    | 18
        U.S.C. Section 1350 Certification of Principal Executive Officer and Principal
        Financial Officer.                                                                                                                                                                                                

- 25 -

---

SIGNATURES

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

| | PARK PLACE ENERGY CORP.              
| | -------------------------------------
| |                                      
| |                                      
| | /s/
      David Johnson              
| | David Johnson                        
| | President and Chief Executive Officer

Dated: August 12, 2008

---