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| UNITED STATES SECURITIES AND EXCHANGE COMMISSION |
|--------------------------------------------------|
| Washington, D.C.                                 |

| NEVADA                                                         |   | 20-5936198                        |
|----------------------------------------------------------------|--------|-----------------------------------|
|                                                           |   |                              |
| (State or other jurisdiction of incorporation or organization) |   | (IRS Employer Identification No.) |

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| Contents                                                                                                |   |   |
|---------------------------------------------------------------------------------------------------------|--------|--------|
| Consolidated Balance Sheets                                                                             |   | 3      |
| Consolidated Statements of Operations                                                                   |   | 4      |
| Consolidated Statements of Stockholders’ Equity                                                   |   | 5      |
| Consolidated Statements of Cash Flows                                                                   |   | 6      |
| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation |   | 12     |
| Item 3.  Quantitative and Qualitative Disclosures About Market Risk                                |   | 13     |
| Item 4. Controls and Procedures                                                                         |   | 14     |
|                                                                                                    |   |   |
| PART II — OTHER INFORMATION                                                                       |   | 14     |
| Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds                               |   | 14     |
| Item 5.  Other Information                                                                         |   | 15     |
| Item 6. Exhibits                                                                                        |   | 16     |

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|                                                                                                                          |   |
|-------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                          |   |   |   |   |   |   |
|                                                                                                                          |   | June 30,2011 |   |   | December 31,2010 |   |
|                                                                                                                          |   | (Unaudited) |   |   |   |   |
|                                                                                                                          |   |   |   |   |   |   |
| ASSETS                                                                                                                        |   |
|                                                                                                                          |   |   |   |   |   |   |
| CURRENT ASSETS                                                                                                                |   |   |   |   |   |   |
| Cash and cash equivalents                                                                                                     |   | $ | 50 |   |   | $ | 14,352 |   |
| Prepaid expenses                                                                                                              |   |   | - |   |   |   | 400 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Total Current Assets                                                                                                          |   |   | 50 |   |   |   | 14,752 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| OTHER ASSETS                                                                                                                  |   |   |   |   |   |   |   |   |
| Oil and gas properties, including $81,000 of unproved property costs using the successful efforts method of accounting        |   |   | 395,997 |   |   |   | 314,997 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Total Other Assets                                                                                                            |   |   | 395,997 |   |   |   | 314,997 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| TOTAL ASSETS                                                                                                                  |   | $ | 396,047 |   |   | $ | 329,749 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                    |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| CURRENT LIABILITIES                                                                                                           |   |   |   |   |   |   |   |   |
| Accounts payable and accrued expenses                                                                                         |   | $ | 17,065 |   |   | $ | 4,103 |   |
| Related-party payables                                                                                                        |   |   | 56,664 |   |   |   | 19,064 |   |
| Note payable                                                                                                                  |   |   | 15,240 |   |   |   | 15,240 |   |
| Derivative liability                                                                                                          |   |   | 9,354 |   |   |   | 11,911 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Total Current Liabilities                                                                                                     |   |   | 98,323 |   |   |   | 50,318 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| LONG-TERM LIABILITIES                                                                                                         |   |   |   |   |   |   |   |   |
| Asset retirement obligation                                                                                                   |   |   | 6,145 |   |   |   | 5,878 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Total Long-Term Liabilities                                                                                                   |   |   | 6,145 |   |   |   | 5,878 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| TOTAL LIABILITIES                                                                                                             |   |   | 104,468 |   |   |   | 56,196 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| STOCKHOLDERS’ EQUITY                                                                                                    |   |   |   |   |   |   |   |   |
| Preferred stock - 1,000,000 shares authorized, $0.001 par value; 42,013 issued and outstanding                                |   |   | 42 |   |   |   | 42 |   |
| Common stock - 74,000,000 shares authorized, $0.001 par value; 52,728,159 and 52,478,159 issued and outstanding, respectively |   |   | 52,728 |   |   |   | 52,478 |   |
| Additional paid-in capital                                                                                                    |   |   | 4,212,139 |   |   |   | 4,167,389 |   |
| Deficit accumulated incurred prior to the exploration stage                                                                   |   |   | (524,202 | ) |   |   | (524,202 | ) |
| Deficit accumulated during the exploration stage                                                                              |   |   | (3,449,128 | ) |   |   | (3,422,154 | ) |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| Total Stockholders’ Equity                                                                                              |   |   | 291,579 |   |   |   | 273,553 |   |
|                                                                                                                          |   |   |   |   |   |   |   |   |
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                              |   | $ | 396,047 |   |   | $ | 329,749 |   |

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|                                              |   | For the Three Months EndedJune 30, |       |   | For the Six Months EndedJune 30, |   |       | From Inceptionon April 30,2009 throughJune 30, |   |
|---------------------------------------------------|--------|------------------------------------|------------|--------|----------------------------------|--------|------------|------------------------------------------------|--------|
|                                              |   | 2011                               |       |   | 2010                             |   |       | 2011                                           |   |   | 2010 |   |   | 2011 |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |
| REVENUES                                          |   | $                                  | -          |   |                             | $      | -          |                                           |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| OPERATING EXPENSES                                |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Accretion expense                                 |   |                               | -          |   |                             |   | -          |                                           |   |   | 267 |   |   |   | - |   |   |   | 267 |   |
| Amortization of deferred tax benefit              |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | 170,800 |   |
| Impairment of intangible assets                   |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | 650,136 |   |
| Management fees                                   |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | 1,109,933 |   |
| General and administrative                        |   |                               | 10,271     |   |                             |   | 39,438     |                                           |   |   | 28,814 |   |   |   | 99,592 |   |   |   | 238,409 |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Operating Expenses                          |   |                               | 10,271     |   |                             |   | 39,438     |                                           |   |   | 29,081 |   |   |   | 99,592 |   |   |   | 2,169,545 |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| LOSS FROM OPERATIONS                              |   |                               | (10,271    | )      |                             |   | (39,438    | )                                              |   |   | (29,081 | ) |   |   | (99,592 | ) |   |   | (2,169,545 | ) |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| OTHER INCOME (EXPENSE)                            |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense                                  |   |                               | (225       | )      |                             |   | (109       | )                                              |   |   | (450 | ) |   |   | (109 | ) |   |   | (811 | ) |
| Gain on forgiveness of debt                       |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | 111,674 |   |
| Other income                                      |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | 40,000 |   |
| Gain (loss) on derivative liability               |   |                               | 7,496      |   |                             |   | -          |                                           |   |   | 2,557 |   |   |   | - |   |   |   | (9,354 | ) |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Other Expense                               |   |                               | 7,271      |   |                             |   | (109       | )                                              |   |   | 2,107 |   |   |   | (109 | ) |   |   | 141,509 |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| LOSS BEFORE TAXES                                 |   |                               | (3,000     | )      |                             |   | (39,547    | )                                              |   |   | (26,974 | ) |   |   | (99,701 | ) |   |   | (2,028,036 | ) |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision for income taxes                        |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | - |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| NET LOSS FROM CONTINUING OPERATIONS               |   |                               | (3,000     | )      |                             |   | (39,547    | )                                              |   |   | (26,974 | ) |   |   | (99,701 | ) |   |   | (2,028,036 | ) |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income from discontinued operations           |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | 309,650 |   |
| Loss on disposal of discontinued operations       |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | (1,730,742 | ) |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss from Discontinued Operations,                |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Net of Income Taxes                               |   |                               | -          |   |                             |   | -          |                                           |   |   | - |   |   |   | - |   |   |   | (1,421,092 | ) |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| NET LOSS                                          |   | $                                  | (3,000     | )      |                             | $      | (39,547    | )                                              |   | $ | (26,974 | ) |   | $ | (99,701 | ) |   | $ | (3,449,128 | ) |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| BASIC LOSS PER SHARE FROM CONTINUING OPERATIONS   |   | $                                  | (0.00      | )      |                             | $      | (0.00      | )                                              |   | $ | (0.00 | ) |   | $ | (0.00 | ) |   |   |   |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| BASIC LOSS PER SHARE FROM DISCONTINUED OPERATIONS |   | $                                  | 0.00       |   |                             | $      | 0.00       |                                           |   | $ | 0.00 |   |   | $ | 0.00 |   |   |   |   |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| TOTAL BASIC LOSS PER SHARE                        |   | $                                  | (0.00      | )      |                             | $      | (0.00      | )                                              |   | $ | (0.00 | ) |   | $ | (0.00 | ) |   |   |   |   |
|                                              |   |                               |       |   |                             |   |       |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING     |   |                               | 52,728,159 |   |                             |   | 34,118,159 |                                           |   |   | 52,685,341 |   |   |   | 34,118,159 |   |   |   |   |   |

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|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |
|----------------------------------------------------------------------------|--------|-----------------|--------|--------|--------------|--------|--------|---------|--------|--------|-------------|--------|--------|------------|---------|--------|-------------------|--------|-----------|--------|--------|
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   | Deficit           |   |      |   |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   | Additional |    |   | Accumulated       |   |      |   |   |
|                                                                       |   | Preferred Stock |   |   | Common Stock |   |   | Paid-In |   |   | During the  |   |   |       |    |
|                                                                       |   | Shares          |   |   | Amount       |   |   | Shares  |   |   | Amount      |   |   | Capital    |    |   | Exploration Stage |   |      | Total  |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |
| Balance, December 31, 2006                                                 |   |            | 22,013 |   |         | $      | 22     |    |   |   | 25,917,159  |   |   | $          | 25,917  |   |              | $      | -         |   |   | $ | (33,951 | ) |   | $ | (8,012 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued for acquisition at $0.08 per share                     |   |            | -      |   |         |   | -      |    |   |   | 22,500,000  |   |   |       | 22,500  |   |              |   | 1,879,439 |   |   |   | - |   |   |   | 1,901,939 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common shares issued for finders fee at $0.001 per share                   |   |            | -      |   |         |   | -      |    |   |   | 2,525,000   |   |   |       | 2,525   |   |              |   | -         |   |   |   | - |   |   |   | 2,525 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Preferred shares issued for acquisition at $0.001 per share                |   |            | 20,000 |   |         |   | 20     |    |   |   | -           |   |   |       | -       |   |              |   | -         |   |   |   | - |   |   |   | 20 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued pursuant to employment stock grants at $0.06 per share |   |            | -      |   |         |   | -      |    |   |   | 1,914,000   |   |   |       | 1,914   |   |              |   | 105,487   |   |   |   | - |   |   |   | 107,401 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common shares issued for intangible assets at $0.08 per share              |   |            | -      |   |         |   | -      |    |   |   | 850,000     |   |   |       | 850     |   |              |   | 70,750    |   |   |   | - |   |   |   | 71,600 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common shares issued for services at $0.45 per share                       |   |            | -      |   |         |   | -      |    |   |   | 50,000      |   |   |       | 50      |   |              |   | 22,450    |   |   |   | - |   |   |   | 22,500 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Capital contribution by shareholder                                        |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | 38,250    |   |   |   | - |   |   |   | 38,250 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Net loss for the year ended December 31, 2007                              |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | -         |   |   |   | (285,341 | ) |   |   | (285,341 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2007                                                 |   |            | 42,013 |   |         | $      | 42     |    |   |   | 53,756,159  |   |   | $          | 53,756  |   |              | $      | 2,116,376 |   |   | $ | (319,292 | ) |   | $ | 1,850,882 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Cancelled share issued pursuant to employee stock grants                   |   |            | -      |   |         |   | -      |    |   |   | (1,898,000  | )      |   |       | (1,898  | )      |              |   | (105,485  | )      |   |   | - |   |   |   | (107,383 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued for cash at $0.38 per share                            |   |            | -      |   |         |   | -      |    |   |   | 110,000     |   |   |       | 110     |   |              |   | 41,874    |   |   |   | - |   |   |   | 41,984 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Option expense pursuant to employee option plan                            |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | 96,750    |   |   |   | - |   |   |   | 96,750 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Net loss for the year ended December 31, 2008                              |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | -         |   |   |   | (204,910 | ) |   |   | (204,910 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2008                                                 |   |            | 42,013 |   |         |   | 42     |    |   |   | 51,968,159  |   |   |       | 51,968  |   |              |   | 2,149,515 |   |   |   | (524,202 | ) |   |   | 1,677,323 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Option expense pursuant to employee option plan                            |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | 401,250   |   |   |   | - |   |   |   | 401,250 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Operational segment sold in exchange for common stock                      |   |            | -      |   |         |   | -      |    |   |   | (22,500,000 | )      |   |       | (22,500 | )      |              |   | 22,500    |   |   |   | - |   |   |   | - |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued for purchase of subsidiary at $0.01 per share          |   |            | -      |   |         |   | -      |    |   |   | 4,050,000   |   |   |       | 4,050   |   |              |   | 36,450    |   |   |   | - |   |   |   | 40,500 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued for cash at $0.05 per share                            |   |            | -      |   |         |   | -      |    |   |   | 600,000     |   |   |       | 600     |   |              |   | 29,400    |   |   |   | - |   |   |   | 30,000 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Net loss for the year ended December 31, 2009                              |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | -         |   |   |   | (2,442,684 | ) |   |   | (2,442,684 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2009                                                 |   |            | 42,013 |   |         |   | 42     |    |   |   | 34,118,159  |   |   |       | 34,118  |   |              |   | 2,639,115 |   |   |   | (2,966,886 | ) |   |   | (293,611 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued for services at $0.05 per share in October 2010        |   |            | -      |   |         |   | -      |    |   |   | 8,000,000   |   |   |       | 8,000   |   |              |   | 392,000   |   |   |   | - |   |   |   | 400,000 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued in acquisition of Jett Rink subsidiary                 |   |            | -      |   |         |   | -      |    |   |   | 10,000,000  |   |   |       | 10,000  |   |              |   | 500,000   |   |   |   | - |   |   |   | 510,000 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued for services at $0.16 pere share on December 30, 2010  |   |            | -      |   |         |   | -      |    |   |   | 360,000     |   |   |       | 360     |   |              |   | 57,240    |   |   |   | - |   |   |   | 57,600 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Contributed capital                                                        |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | 579,034   |   |   |   | - |   |   |   | 579,034 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Net loss for the year ended December 31, 2010                              |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | -         |   |   |   | (979,470 | ) |   |   | (979,470 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2010                                                 |   |            | 42,013 |   |         |   | 42     |    |   |   | 52,478,159  |   |   |       | 52,478  |   |              |   | 4,167,389 |   |   |   | (3,946,356 | ) |   |   | 273,553 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Common stock issued for oil and gas leases                                 |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| at $0.18 per share (unaudited)                                             |   |            | -      |   |         |   | -      |    |   |   | 250,000     |   |   |       | 250     |   |              |   | 44,750    |   |   |   | - |   |   |   | 45,000 |   |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Net loss for the six months ended                                          |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| June 30, 2011 (unaudited)                                                  |   |            | -      |   |         |   | -      |    |   |   | -           |   |   |       | -       |   |              |   | -         |   |   |   | (26,974 | ) |   |   | (26,974 | ) |
|                                                                       |   |            |   |   |         |   |   |    |   |   |        |   |   |       |    |   |              |   |      |   |   |   |   |   |   |   |   |   |
| Balance, June 30, 2011 (unaudited)                                         |   |            | 42,013 |   |         | $      | 42     |    |   |   | 52,728,159  |   |   | $          | 52,728  |   |              | $      | 4,212,139 |   |   | $ | (3,973,330 | ) |   | $ | 291,579 |   |

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|                                                                              |   |                     |    |   |         |   |    |           |   |
|-----------------------------------------------------------------------------------|--------|--------------------------|---------|--------|--------------|--------|---------|----------------|--------|
|                                                                              |   |                     |    |   |         |   |    | From Inception |   |
|                                                                              |   |                     |    |   |         |   |    | on April 30,   |   |
|                                                                              |   | For the Six Months Ended |    |   | 2009 through |   |
|                                                                              |   | June 30,                 |    |   | June 30,     |   |
|                                                                              |   | 2011                     |    |   | 2010         |   |    | 2011           |   |
| OPERATING ACTIVITIES                                                              |   |                     |    |   |         |   |    |           |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |
| Net loss                                                                          |   | $                        | (26,974 | )      |         | $      | (99,701 | )              |   | $ | (3,449,128 | ) |
| Adjustments to Reconcile Net Loss to Net  Cash Used by Operating Activities: |   |                     |    |   |         |   |    |           |   |   |   |   |
| Depreciation expense                                                              |   |                     | -       |   |         |   | 3,740   |           |   |   | 726 |   |
| Accretion expense                                                                 |   |                     | 267     |   |         |   | -       |           |   |   | 267 |   |
| Impairment of goodwill                                                            |   |                     | -       |   |         |   | -       |           |   |   | 528,894 |   |
| Change in deriative liability                                                     |   |                     | (2,557  | )      |         |   | -       |           |   |   | 9,354 |   |
| Amortization of intangibles                                                       |   |                     | -       |   |         |   | -       |           |   |   | 2,803 |   |
| Employee option grants issued                                                     |   |                     | -       |   |         |   | -       |           |   |   | 46,500 |   |
| Cancellation of employee stock option shares                                      |   |                     | -       |   |         |   | -       |           |   |   | 354,750 |   |
| Impairment of intangible assets                                                   |   |                     | -       |   |         |   | -       |           |   |   | 121,242 |   |
| Common stock issued for services                                                  |   |                     | -       |   |         |   | -       |           |   |   | 457,600 |   |
| Gain on settlement of debt                                                        |   |                     | -       |   |         |   | -       |           |   |   | (111,457 | ) |
| Deferred tax asset                                                                |   |                     | -       |   |         |   | -       |           |   |   | 170,800 |   |
| Changes in operating assets and liabilities:                                      |   |                     |    |   |         |   |    |           |   |   |   |   |
| Increase in prepaid expenses                                                      |   |                     | 400     |   |         |   | -       |           |   |   | - |   |
| Related party payables                                                            |   |                     | 2,600   |   |         |   | 19,131  |           |   |   | (33,822 | ) |
| Accounts payable and accrued liabilities                                          |   |                     | 12,962  |   |         |   | 70,915  |           |   |   | 312,628 |   |
| Accrued salaries                                                                  |   |                     | -       |   |         |   | -       |           |   |   | 83,333 |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| Net Cash Used in Continuing Operating Activities                                  |   |                     | (13,302 | )      |         |   | (5,915  | )              |   |   | (1,505,510 | ) |
| Net Cash Provided by Discontinued Operating Activities                            |   |                     | -       |   |         |   | -       |           |   |   | 1,678,016 |   |
| Net Cash Provided by (Used in) Operating Activities                               |   |                     | (13,302 | )      |         |   | (5,915  | )              |   |   | 172,506 |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| INVESTING ACTIVITIES                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| Purchase of property and equipment                                                |   |                     | -       |   |         |   | (3,326  | )              |   |   | (216,556 | ) |
| Purchase of oil and gas properties                                                |   |                     | (1,000  | )      |         |   | -       |           |   |   | (1,000 | ) |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| Net Cash Used in Continuing Investing Activities                                  |   |                     | (1,000  | )      |         |   | (3,326  | )              |   |   | (217,556 | ) |
| Net Cash Used in Discontinued Investing Activities                                |   |                     | -       |   |         |   | -       |           |   |   | - |   |
| Net Cash Used in Investing Activities                                             |   |                     | (1,000  | )      |         |   | (3,326  | )              |   |   | (217,556 | ) |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| FINANCING ACTIVITIES                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| Proceeds from note payable                                                        |   |                     | -       |   |         |   | -       |           |   |   | 15,000 |   |
| Proceeds from the sale of common stock                                            |   |                     | -       |   |         |   | -       |           |   |   | 30,000 |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| Net Cash Provided by Continuing Financing Activities                              |   |                     | -       |   |         |   | -       |           |   |   | 45,000 |   |
| Net Cash Used in Discontinued Financing Activities                                |   |                     | -       |   |         |   | -       |           |   |   | - |   |
| Net Cash Provided by Financing Activities                                         |   |                     | -       |   |         |   | -       |           |   |   | 45,000 |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| NET INCREASE (DECREASE) IN CASH                                                   |   | $                        | (14,302 | )      |         | $      | (9,241  | )              |   | $ | (50 | ) |
| CASH AT BEGINNING OF PERIOD                                                       |   |                     | 14,352  |   |         |   | 9,453   |           |   |   | 100 |   |
|                                                                              |   |                     |    |   |         |   |    |           |   |   |   |   |
| CASH AT END OF PERIOD                                                             |   | $                        | 50      |   |         | $      | 212     |           |   | $ | 50 |   |

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|                                                                                         |   |                     |   |   |         |   |    |           |   |
|----------------------------------------------------------------------------------------------|--------|--------------------------|--------|--------|--------------|--------|---------|----------------|--------|
|                                                                                         |   |                     |   |   |         |   |    | From Inception |   |
|                                                                                         |   |                     |   |   |         |   |    | on April 30,   |   |
|                                                                                         |   | For the Six Months Ended |   |   | 2009 through |   |
|                                                                                         |   | June 30,                 |   |   | June 30,     |   |
|                                                                                         |   | 2011                     |   |   | 2010         |   |    | 2011           |   |
|                                                                                         |   |                     |   |   |         |   |    |           |   |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION                                            |   |                     |   |   |         |   |    |           |   |
|                                                                                         |   |                     |   |   |         |   |    |           |   |
| CASH PAID FOR:                                                                               |   |                     |   |   |         |   |    |           |   |
| Income taxes                                                                                 |   | $                        | -      |   |         | $      | -       |           |   | $ | - |   |
| Interest                                                                                     |   |                     | -      |   |         |   | -       |           |   |   | - |   |
|                                                                                         |   |                     |   |   |         |   |    |           |   |   |   |   |
| NON CASH FINANCING ACTIVITIES:                                                               |   |                     |   |   |         |   |    |           |   |   |   |   |
| Common stock issued in purchases of subsidiaries                                             |   | $                        | -      |   |         | $      | -       |           |   | $ | 550,500 |   |
| Common stock cancelled                                                                       |   |                     | -      |   |         |   | -       |           |   |   | 20,500 |   |
| Contributed capital from forgiveness of a related-party debt                                 |   |                     | -      |   |         |   | 498,432 |           |   |   | 579,034 |   |
| Common stock and note issued to related party for acquisition of unproved oil and gas leases |   |                     | 80,000 |   |         |   | -       |           |   |   | 80,000 |   |

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| Exhibit No. |   | Document                              |   | Location |
|-------------|--------|---------------------------------------|--------|----------|
| 31          |   | Rule 13a-41(a)/15d-14(a) Certificates |   | Included |
| 32          |   | Section 1350 Certifications           |   | Included |

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| /s/ Kenneth B. Liebscher                       |   |   |
|------------------------------------------------|--------|--------|
|  Kenneth B. Liebscher, Director & CEO |   |   |