UNITED
STATES
 SECURITIES AND EXCHANGE
COMMISSION
 Washington, D.C.
20549
 FORM 10-Q
 QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF
1934
 
 For
the quarterly period ended January 31, 2009
 
 Commission
file number 000-52495
 
 PACIFIC COPPER
CORP.
 (Exact
name of registrant as specified in its charter)
 
 Delaware
                
                98-0504006(State
      of incorporation)
                
                (I.R.S.
      Employer Identification No.)
 
 3430 E.
Sunrise Dr., Ste 160, Tucson, AZ 85718
 (Address
of principal executive offices including zip code)
 
 (520)
989-0021; FAX (520) 623-3326
 (Registrant’s
telephone number including area code)
 
 Indicate
by check mark 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 þ 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. (Check one):
 
 Large accelerated
      filer  ̈
                                          
                                          Accelerated
      filer  ̈
                                          
                                          Non-accelerated
      filer    ̈
                                          
                                          Smaller reporting
      company þ(Do not check if a smaller reporting company)
 
 Indicate
by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes  ̈No þ
 
 The
number of shares of registrant’s common stock outstanding as of January 31, 2009
was 44,561,600.
  
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 (Unaudited-
Prepared by Management)
  INTERIM
CONSOLIDATED FINANCIAL STATEMENTS
  JANUARY
31, 2009
  (Amounts
expressed in US Dollars)
  (Unaudited)
  CONTENTS
 
 Interim
      Consolidated Balance Sheets as of January 31, 2009 and October 31,
      2008
                    2Interim
      Consolidated Statements of Operations for the three months ended January
      31, 2009and
      January 31, 2008 and the period from Inception (May 18, 1999) to January
      31, 2009
                    3Interim
      Consolidated Statements of Changes in Stockholders' Equity for the three
      months endedJanuary
      31, 2009 and from Inception (May 18, 1999) to January 31,
      2009.
                    4Interim
      Consolidated Statements of Cash Flows for the three months ended January
      31, 2009and
      January 31, 2008 and from Inception (May 18, 1999) to January 31,
      2009.
                    5Condensed
      Notes to Interim Consolidated Financial Statements
                    6-24
  
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Interim
Consolidated Balance Sheets as at
 January
31, 2009 and October 31, 2008
 (Amounts
expressed in US Dollars)
 (Unaudited
– Prepared by Management)
 
 January
      31,
                                                                  
                                                                  
                                                                  October
      31,2009
                                                                  
                                                                  
                                                                  2008$
                                                                  
                                                                  
                                                                  $ASSETSCurrentCash
      and cash equivalents
                                                                  
                                                                  
                                                                  17,961
                                                                  
                                                                  
                                                                  
                                                                  110,746Prepaid
      expenses and other receivables
                                                                  
                                                                  
                                                                  16,453
                                                                  
                                                                  
                                                                  
                                                                  35,157Advances
      to a related party (note12)
                                                                  
                                                                  
                                                                  25,000
                                                                  
                                                                  
                                                                  
                                                                  175,000Total
      Current Assets
                                                                  
                                                                  
                                                                  59,414
                                                                  
                                                                  
                                                                  
                                                                  320,903Plant and Equipment, net
      (note 4)
                                                                  
                                                                  
                                                                  140,154
                                                                  
                                                                  
                                                                  
                                                                  155,443Mining claims (note
      8)
                                                                  
                                                                  
                                                                  600
                                                                  
                                                                  
                                                                  
                                                                  600Total
      Assets
                                                                  
                                                                  
                                                                  200,168
                                                                  
                                                                  
                                                                  
                                                                  476,946LIABILITIESCurrentAccounts
      payable
                                                                  
                                                                  
                                                                  285,780
                                                                  
                                                                  
                                                                  
                                                                  297,370Accrued
      liabilities
                                                                  
                                                                  
                                                                  19,463
                                                                  
                                                                  
                                                                  
                                                                  85,852Due
      to related parties (note 10)
                                                                  
                                                                  
                                                                  402,206
                                                                  
                                                                  
                                                                  
                                                                  -Derivative
      financial instrument (note14)
                                                                  
                                                                  
                                                                  123,750
                                                                  
                                                                  
                                                                  
                                                                  101,250Advances
      from non-related party (note13)
                                                                  
                                                                  
                                                                  366,163
                                                                  
                                                                  
                                                                  
                                                                  259,244Advances
      from related party (note10)
                                                                  
                                                                  
                                                                  70,000
                                                                  
                                                                  
                                                                  
                                                                  70,000Total
      Current Liabilities
                                                                  
                                                                  
                                                                  1,267,362
                                                                  
                                                                  
                                                                  
                                                                  813,716Convertible
      note (note14)
                                                                  
                                                                  
                                                                  37,610
                                                                  
                                                                  
                                                                  
                                                                  32,708Total
      Liabilities
                                                                  
                                                                  
                                                                  1,304,972
                                                                  
                                                                  
                                                                  
                                                                  846,424Minority
      Interest (note 3)
                                                                  
                                                                  
                                                                  54,934
                                                                  
                                                                  
                                                                  
                                                                  54,950Going
      Concern (note 2)Commitments
      and Contingencies (note 9)Related
      Party Transactions (note 10)STOCKHOLDERS'
      DEFICIENCYCapital Stock(note
      5)Preferred
      stock, $0.0001 par value, 50,000,000 shares authorized, Nil issued and
      outstanding (October 31, 2008 - nil)
                                                                  
                                                                  
                                                                  -
                                                                  
                                                                  
                                                                  
                                                                  -Common
      stock, $0.0001 par value, 200,000,000 shares authorized, 44,561,600issued and
      outstanding (October 31, 2008 - 44,561,600)
                                                                  
                                                                  
                                                                  4,456
                                                                  
                                                                  
                                                                  
                                                                  4,456Additional Paid-in
      Capital
                                                                  
                                                                  
                                                                  13,984,841
                                                                  
                                                                  
                                                                  
                                                                  13,893,200Deferred stock compensation(note 11)
                                                                  
                                                                  
                                                                  (83,333
                                                                  )
                                                                  
                                                                  
                                                                  (145,833
                                                                  )Accumulated
      other comprehensive income
                                                                  
                                                                  
                                                                  2,562
                                                                  
                                                                  
                                                                  
                                                                  1,064Deficit
      Accumulated During the Exploration Stage
                                                                  
                                                                  
                                                                  (15,068,264
                                                                  )
                                                                  
                                                                  
                                                                  (14,177,315
                                                                  )Total
      Stockholders' Deficiency
                                                                  
                                                                  
                                                                  (1,159,738
                                                                  )
                                                                  
                                                                  
                                                                  (424,428
                                                                  )Total Liabilities and
      Stockholders'Deficiency
                                                                  
                                                                  
                                                                  200,168
                                                                  
                                                                  
                                                                  
                                                                  476,946
  See
condensed notes to the interim consolidated financial
statements
  - 2 -


PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Interim
Consolidated Statements of Operations


For the
three months ended January 31, 2009 and January 31, 2008 and the


Period
from Inception (May 18, 1999) to January 31, 2009


(Amounts
expressed in US Dollars)


(Unaudited
– Prepared by Management)





For
      the
                                        
                                        
                                        For
      thequarter
                                        
                                        
                                        quarterCumulative
                                        
                                        
                                        ended
                                        
                                        
                                        endedsince
                                        
                                        
                                        January
      31,
                                        
                                        
                                        January
      31,inception
                                        
                                        
                                        2009
                                        
                                        
                                        2008$
                                        
                                        
                                        $
                                        
                                        
                                        $Operating
      ExpensesGeneral
      and administration (note 16)
                                        
                                        
                                        4,761,889
                                        
                                        
                                        
                                        342,543
                                        
                                        
                                        
                                        760,388Project
      expenses (note 15)
                                        
                                        
                                        4,691,019
                                        
                                        
                                        
                                        491,563
                                        
                                        
                                        
                                        706,663Mineral
      claims acquisition cost expense (note 8)
                                        
                                        
                                        5,523,871
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        5,523,871Amortization
                                        
                                        
                                        57,947
                                        
                                        
                                        
                                        15,289
                                        
                                        
                                        
                                        4,547Total
      Operating Expenses
                                        
                                        
                                        15,034,726
                                        
                                        
                                        
                                        849,395
                                        
                                        
                                        
                                        6,995,469Loss
      from Operations
                                        
                                        
                                        (15,034,726
                                        )
                                        
                                        
                                        (849,395
                                        )
                                        
                                        
                                        (6,995,469
                                        )Other
      income-Interest
                                        
                                        
                                        54,508
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -Other
      expense-Interest
                                        
                                        
                                        (26,543
                                        )
                                        
                                        
                                        (19,070
                                        )Other
      expense-Derivative Financial Instrument
                                        
                                        
                                        (61,875
                                        )
                                        
                                        
                                        (22,500
                                        )Loss
      before Income Taxes
                                        
                                        
                                        (15,068,636
                                        )
                                        
                                        
                                        (890,965
                                        )
                                        
                                        
                                        (6,995,469
                                        )Provision
      for income taxes
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -Minority
      Interest
                                        
                                        
                                        372
                                        
                                        
                                        
                                        16Net
      Loss
                                        
                                        
                                        (15,068,264
                                        )
                                        
                                        
                                        (890,949
                                        )
                                        
                                        
                                        (6,995,469
                                        )Loss
      per share-Basic and Diluted
                                        
                                        
                                        
                                        
                                        
                                        
                                        (0.02
                                        )
                                        
                                        
                                        (0.21
                                        )Weighted
      Average Common Shares Outstanding
                                        
                                        
                                        
                                        
                                        
                                        
                                        44,561,600
                                        
                                        
                                        
                                        33,159,224





See
condensed notes to the interim consolidated financial statements




3




PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Consolidated
Statements of Changes in Stockholders’ Equity (Deficiency) from inception (May
18, 1999) to January 31, 2009


(Amounts
expressed in US Dollars)




Deficit
                                                                      
                                                                      
                                                                      AccumulatedAccumulated
                                                                      
                                                                      
                                                                      OtherCommon
      Stock
                                                                      
                                                                      
                                                                      Additional
                                                                      
                                                                      
                                                                      Deferred
                                                                      
                                                                      
                                                                      Stock
                                                                      
                                                                      
                                                                      during
      the
                                                                      
                                                                      
                                                                      Comprehensive
                                                                      
                                                                      
                                                                      Total
                                                                      
                                                                      
                                                                      ComprehensivePaid-in
                                                                      
                                                                      
                                                                      Stock
                                                                      
                                                                      
                                                                      Subscription
                                                                      
                                                                      
                                                                      Exploration
                                                                      
                                                                      
                                                                      Income
                                                                      
                                                                      
                                                                      Stockholders’
                                                                      
                                                                      
                                                                      IncomeNumber
                                                                      
                                                                      
                                                                      Amount
                                                                      
                                                                      
                                                                      Capital
                                                                      
                                                                      
                                                                      Compensation
                                                                      
                                                                      
                                                                      Receivable
                                                                      
                                                                      
                                                                      Stage
                                                                      
                                                                      
                                                                      (Loss)
                                                                      
                                                                      
                                                                      Equity
                                                                      
                                                                      
                                                                      (loss)of
      Shares
                                                                      
                                                                      
                                                                      $
                                                                      
                                                                      
                                                                      $
                                                                      
                                                                      
                                                                      $
                                                                      
                                                                      
                                                                      $
                                                                      
                                                                      
                                                                      $
                                                                      
                                                                      
                                                                      $
                                                                      
                                                                      
                                                                      $Common
      stock issued on inception
                                                                      
                                                                      
                                                                      1
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      1
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      1Common
      shares issued for nil consideration
                                                                      
                                                                      
                                                                      7,605,932
                                                                      
                                                                      
                                                                      
                                                                      761
                                                                      
                                                                      
                                                                      
                                                                      (761
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -Cancelled
      shares
                                                                      
                                                                      
                                                                      (1
                                                                      )
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      (1
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (1
                                                                      )Contributed
      Services
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      8,743
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      8,743Net
      Loss for the period from inception (May 18, 1999) through October 31,
      2004
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (8,743
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (8,743Balance,
      October 31, 2004
                                                                      
                                                                      
                                                                      7,605,932
                                                                      
                                                                      
                                                                      
                                                                      761
                                                                      
                                                                      
                                                                      
                                                                      7,982
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (8,743
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -Contributed
      Services
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      1,178
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      1,178Net
      Loss
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (1,178
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (1,178Balance
      October 31, 2005
                                                                      
                                                                      
                                                                      7,605,932
                                                                      
                                                                      
                                                                      
                                                                      761
                                                                      
                                                                      
                                                                      
                                                                      9,160
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (9,921
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -Common
      shares issued for cash
                                                                      
                                                                      
                                                                      4,710,000
                                                                      
                                                                      
                                                                      
                                                                      471
                                                                      
                                                                      
                                                                      
                                                                      470,529
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      471,000Common
      shares issued for acquisition of interests in mineral
    claims
                                                                      
                                                                      
                                                                      5,000,000
                                                                      
                                                                      
                                                                      
                                                                      500
                                                                      
                                                                      
                                                                      
                                                                      499,500
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      500,000Net
      Loss
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (647,453
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (647,453Balance,
      October 31, 2006
                                                                      
                                                                      
                                                                      17,315,932
                                                                      
                                                                      
                                                                      
                                                                      1,732
                                                                      
                                                                      
                                                                      
                                                                      979,189
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (657,374
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      323,547Common
      shares issued for cash
                                                                      
                                                                      
                                                                      660,000
                                                                      
                                                                      
                                                                      
                                                                      66
                                                                      
                                                                      
                                                                      
                                                                      65,934
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      66,000Common
      shares issued for cash
                                                                      
                                                                      
                                                                      2,000,000
                                                                      
                                                                      
                                                                      
                                                                      200
                                                                      
                                                                      
                                                                      
                                                                      199,800
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      200,000Common
      shares issued for cash
                                                                      
                                                                      
                                                                      4,520,000
                                                                      
                                                                      
                                                                      
                                                                      452
                                                                      
                                                                      
                                                                      
                                                                      2,259,548
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      2,260,000Stock
      subscription received
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      30,000
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      30,000Stock
      Issuance cost
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (72,800
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (72,800
                                                                      )Common
      shares issued for stock subscriptions received
                                                                      
                                                                      
                                                                      60,000
                                                                      
                                                                      
                                                                      
                                                                      6
                                                                      
                                                                      
                                                                      
                                                                      (6
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -Common
      shares issued for cash
                                                                      
                                                                      
                                                                      1,590,000
                                                                      
                                                                      
                                                                      
                                                                      159
                                                                      
                                                                      
                                                                      
                                                                      794,841
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      795,000Common
      shares issued for services
                                                                      
                                                                      
                                                                      3,000,000
                                                                      
                                                                      
                                                                      
                                                                      300
                                                                      
                                                                      
                                                                      
                                                                      1,499,700
                                                                      
                                                                      
                                                                      
                                                                      (1,062,499
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      437,501Stock
      based compensation
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      294,574
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      294,574Compensation
      expense on issue of warrants
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      21,093
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      21,093Stock
      Issuance cost
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (43,750
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (43,750
                                                                      )Net
      Loss
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (2,940,779
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (2,940,779Balance
      October 31, 2007
                                                                      
                                                                      
                                                                      29,145,932
                                                                      
                                                                      
                                                                      
                                                                      2,915
                                                                      
                                                                      
                                                                      
                                                                      6,028,123
                                                                      
                                                                      
                                                                      
                                                                      (1,062,499
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (3,598,153
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      1,370,386Common
      stock issued on acquisition of Peru subsidiary
                                                                      
                                                                      
                                                                      4,850,000
                                                                      
                                                                      
                                                                      
                                                                      485
                                                                      
                                                                      
                                                                      
                                                                      2,424,515
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      2,425,000Common
      stock issued on acquisition of Chile subsidiary
                                                                      
                                                                      
                                                                      6,088,452
                                                                      
                                                                      
                                                                      
                                                                      608
                                                                      
                                                                      
                                                                      
                                                                      3,043,617
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      3,044,225Common
      shares issued for cash (net)
                                                                      
                                                                      
                                                                      3,157,143
                                                                      
                                                                      
                                                                      
                                                                      316
                                                                      
                                                                      
                                                                      
                                                                      1,027,334
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (175,000
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      852,650Common
      shares issued for cash (net)
                                                                      
                                                                      
                                                                      743,572
                                                                      
                                                                      
                                                                      
                                                                      75
                                                                      
                                                                      
                                                                      
                                                                      246,805
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      246,880Stock
      subscription received
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      175,000
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      175,000Common
      shares issued for cash (net)
                                                                      
                                                                      
                                                                      576,501
                                                                      
                                                                      
                                                                      
                                                                      57
                                                                      
                                                                      
                                                                      
                                                                      201,228
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      201,285Stock
      based compensation
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      679,971
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      679,971Compensation
      expense on issue of warrants
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      235,982
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      235,982Amortization
      of deferred stock compensation
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      916,666
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      916,666Beneficial
      conversion feature of the convertible note financing
      transaction
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      5,625
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      5,625Foreign
      currency translation
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      1,064
                                                                      
                                                                      
                                                                      
                                                                      1,064
                                                                      
                                                                      
                                                                      
                                                                      1,064Net
      Loss for the year  ended October  31,
    2008
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      -
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (10,579,162
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (10,579,162
                                                                      )
                                                                      
                                                                      
                                                                      (10,579,162
                                                                      )Balance
      October 31, 2008
                                                                      
                                                                      
                                                                      44,561,600
                                                                      
                                                                      
                                                                      
                                                                      4,456
                                                                      
                                                                      
                                                                      
                                                                      13,893,200
                                                                      
                                                                      
                                                                      
                                                                      (145,833
                                                                      )
                                                                      
                                                                      
                                                                      0
                                                                      
                                                                      
                                                                      
                                                                      (14,177,315
                                                                      )
                                                                      
                                                                      
                                                                      1,064
                                                                      
                                                                      
                                                                      
                                                                      (424,428
                                                                      )
                                                                      
                                                                      
                                                                      (10,578,098
                                                                      )Stock
      based compensation
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      64,904
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      64,904Compensation
      expense on issue of warrants
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      26,737
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      26,737Amortization
      of deferred stock compensation
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      62,500
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      62,500Foreign
      currency translation
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      1,498
                                                                      
                                                                      
                                                                      
                                                                      1,498
                                                                      
                                                                      
                                                                      
                                                                      1,498Net
      Loss for the quarter  ended January  31,
      2009
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (890,949
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (890,949
                                                                      )
                                                                      
                                                                      
                                                                      (890,949
                                                                      )Balance
      January 31, 2009
                                                                      
                                                                      
                                                                      44,561,600
                                                                      
                                                                      
                                                                      
                                                                      4,456
                                                                      
                                                                      
                                                                      
                                                                      13,984,841
                                                                      
                                                                      
                                                                      
                                                                      (83,333
                                                                      )
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      
                                                                      (15,068,264
                                                                      )
                                                                      
                                                                      
                                                                      2,562
                                                                      
                                                                      
                                                                      
                                                                      (1,159,738
                                                                      )
                                                                      
                                                                      
                                                                      ((889,451
                                                                      )




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




4





PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Interim
Consolidated Statements of Cash Flows


For the
three months ended January 31, 2009 and January 31, 2008 and from inception (May
18, 1999) to January 31, 2009


(Amounts
expressed in US Dollars)


(Unaudited
– Prepared by Management)





CumulativeSince
                    
                    
                    January
      31,
                    
                    
                    January
      31,Inception
                    
                    
                    2009
                    
                    
                    2008Cash
      Flows from Operating ActivitiesNet
      Loss
                    
                    
                    (15,068,264
                    )
                    
                    
                    (890,949
                    )
                    
                    
                    (6,995,469
                    )Adjustment
      for:Amortization
                    
                    
                    57,947
                    
                    
                    
                    15,289
                    
                    
                    
                    4,547Stock
      based compensation
                    
                    
                    1,039,449
                    
                    
                    
                    64,904
                    
                    
                    
                    173,221Compensation
      expense on issue of warrants
                    
                    
                    283,812
                    
                    
                    
                    26,737
                    
                    
                    
                    26,737Expenses
      credited to Additional Paid-in Capital
                    
                    
                    9,921
                    
                    
                    
                    -
                    
                    
                    
                    -Shares
      issued for mineral claims
                    
                    
                    5,969,225
                    
                    
                    
                    -
                    
                    
                    
                    5,469,225Amortization
      of deferred stock compensation
                    
                    
                    1,416,667
                    
                    
                    
                    62,500
                    
                    
                    
                    262,500Interest
      on loans
                    
                    
                    14,118
                    
                    
                    
                    6,919
                    
                    
                    
                    -Fair
      value adjustment to compound derivative
                    
                    
                    6,875
                    
                    
                    
                    2,500
                    
                    
                    
                    -Fair
      value adjustment to additional investment rights
                    
                    
                    55,000
                    
                    
                    
                    20,000
                    
                    
                    
                    -Amortization
      of debt discount
                    
                    
                    5,110
                    
                    
                    
                    4,902
                    
                    
                    
                    -Changes
      in non-cash working capitalPrepaid
      expenses
                    
                    
                    (16,453
                    )
                    
                    
                    18,704
                    
                    
                    
                    16,801Advances
      to related parties
                    
                    
                    (25,000
                    )
                    
                    
                    150,000
                    
                    
                    
                    -Accounts
      payable
                    
                    
                    285,780
                    
                    
                    
                    (11,590
                    )
                    
                    
                    (138,507
                    )Accrued
      liabilities
                    
                    
                    19,463
                    
                    
                    
                    (66,389
                    )
                    
                    
                    (36,265
                    )Due
      to related parties
                    
                    
                    402,206
                    
                    
                    
                    402,206Minority
      Interest
                    
                    
                    54,934
                    
                    
                    
                    (16
                    )
                    
                    
                    55,245Net
      cash used in operating activities
                    
                    
                    (5,489,210
                    )
                    
                    
                    (194,283
                    )
                    
                    
                    (1,161,965
                    )Cash
      Flows from Investing ActivitiesAcquisition
      of plant and equipment
                    
                    
                    (198,101
                    )
                    
                    
                    -
                    
                    
                    
                    (65,550
                    )Acquisition
      of mineral claims
                    
                    
                    (600
                    )
                    
                    
                    -
                    
                    
                    
                    (600
                    )Net
      cash used in investing activities
                    
                    
                    (198,701
                    )
                    
                    
                    -
                    
                    
                    
                    (66,150
                    )Cash
      Flows from Financing ActivitiesIssuance
      of common shares for cash (net)
                    
                    
                    5,181,265
                    
                    
                    
                    -
                    
                    
                    
                    -Advances
      from non-related parties
                    
                    
                    352,045
                    
                    
                    
                    100,000Advances
      from related parties
                    
                    
                    70,000
                    
                    
                    
                    -
                    
                    
                    
                    -Convertible
      notes
                    
                    
                    100,000
                    
                    
                    
                    -
                    
                    
                    
                    -Net
      cash provided by financing activities
                    
                    
                    5,703,310
                    
                    
                    
                    100,000
                    
                    
                    
                    -Effect
      of foreign currency exchange rate changes
                    
                    
                    2,562
                    
                    
                    
                    1,498Net
      increase (decrease) in Cash and Cash equivalents
                    
                    
                    17,961
                    
                    
                    
                    (92,785
                    )
                    
                    
                    (1,228,115
                    )Cash-
      beginning of period
                    
                    
                    -
                    
                    
                    
                    110,746
                    
                    
                    
                    1,617,344Cash
      - end of period
                    
                    
                    17,961
                    
                    
                    
                    17,961
                    
                    
                    
                    389,229Supplemental
      Cash Flow InformationInterest
      paid
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Income
      taxes paid
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -





See
condensed notes to the interim consolidated financial
statements


- 5
-




PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


January
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





1.       Basis
of Presentation




The
accompanying unaudited financial statements do not include all the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of recurring accruals) considered necessary for fair presentation have been
included. Operating results for the interim period are not necessarily
indicative of the results that may be expected for the year ended October 31,
2009. Interim financial statements should be read in conjunction with the
company’s annual audited financial statements.





The
interim consolidated financial statements include the accounts of Pacific Copper
Corp. (the “Company”  or “Pacific Copper” ), and its subsidiaries
Pacific Copper Peru SRL, a limited liability partnership formed under the laws
of Peru (99% owned by the Company) and Sociedad Pacific Copper Chile
Limitada, a limited liability partnership formed under the laws of Chile
(99% owned by the Company).  All material inter-company accounts and
transactions have been eliminated.




2. Going
Concern





The
Company's financial statements are presented on a going concern basis, which
contemplates the realization of assets and satisfaction of liabilities in the
normal course of business. The Company has no source for operating revenue and
expects to incur significant expenses before establishing operating revenue. The
Company has a need for equity capital and financing for working capital and
exploration of its properties. Because of continuing operating losses, negative
working capital and cash outflows from operations, the Company’s continuance as
a going concern is dependent upon its ability to obtain adequate financing and
to reach profitable levels of operation. The Company’s future success is
dependent upon its continued ability to raise sufficient capital, not only to
maintain its operating expenses, but to explore for reserves. There is no
guarantee that such capital will continue to be available on acceptable terms,
if at all or if the Company will attain profitable levels of operation.
Management’s plans to mitigate these conditions are described
below.




The
Company is in the exploration stage and has not yet realized revenues from any
operations.  The Company has incurred a loss of $890,949 for the three
month period ended January 31, 2009.  This loss includes a non-cash stock
based compensation expense for $64,904 and non-cash compensation expense
for issue of warrants for $ 26,737.. At January 31, 2009, the Company had
an accumulated deficit during the exploration stage of
$15,068,264.  During the year ended October 31, 2008 the Company
raised an additional capital of $1,475,815 (net of offering costs). Further,
during the year ended October 31, 2008 the Company raised an additional $100,000
being subscription for convertible notes (note 14). The Company did not raise
any share capital during the three months ended January 31, 2009. Management's
plan is to continue raising additional funds through future equity or debt
financing until it achieves profitable operations from mineral extraction
activities.




3.      
Nature of Business and Operations




The
Company was incorporated on May 18, 1999 as Gate-1 Financial, Inc. under the
laws of the State of Delaware.  On August 17, 2006, Gate-1 Financial, Inc.
changed its name to Pacific Copper Corp.  The Company operates with
the intent of exploration and, if feasible, extraction of
minerals.


- 6
-




PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


January
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)




3. Nature
of Business and Operations-Cont’d




On
December 17, 2007, Pacific Copper completed the acquisition of Pacific Copper
Peru SRL, a limited liability partnership organized under the laws of Peru
(“Peru SRL”) pursuant to the Share Exchange Agreement among the Company, Peru
SRL and the former partners of Peru SRL dated as of April 11, 2007, as amended
(the “Peru Agreement”).





Pursuant
to the Peru Agreement, the Company issued 4,850,000 shares of the Company’s
common stock (the “Peru Consideration Shares”) to the partners of Peru SRL as
consideration for the acquisition of 99% of Peru SRL.  The 1% minority
interest was credited with $24,495.  As a result of the acquisition,
Peru SRL became a subsidiary of the Company.  The Peru Consideration
Shares were issued in escrow subject to a Closing and Escrow Agreement dated
December 14, 2007 among the Company, Peru SRL and the former partners of Peru
SRL (the “Closing Agreement”).  Pursuant to the terms of the Closing
Agreement, the former partners of Peru SRL must satisfy certain post-closing
items, prior to the release of the Peru Consideration Shares from escrow. As of
the date of this report, the Peru Consideration shares remain in
escrow.





On
January 8, 2008, Pacific Copper acquired Sociedad Pacific Copper Chile Limitada,
a limited liability partnership organized under the laws of Chile (“Pacific
LTDA”) pursuant to a Share Exchange Agreement entered into as of April 11, 2007
(the “Chile Agreement”), as amended, between the Company and the former partners
of Pacific LTDA.  Pursuant to the Chile Agreement the Company issued
6,088,452 of its common shares (the “Chile Consideration Shares”) to the former
partners of Pacific LTDA as consideration for the acquisition of 99% of Pacific
LTDA.  The 1% minority interest was credited with
$30,750.  As a result of the acquisition, Pacific LTDA became a
subsidiary of the Company.  The Chile Consideration Shares were issued
in escrow subject to a Closing and Escrow Agreement dated January 8, 2008 among
the Company, Pacific LTDA and the former partners of Pacific LTDA (the “Closing
Agreement”).  Pursuant to the terms of the Closing Agreement, the
former partners of Pacific LTDA must satisfy certain post-closing items prior to
the release of the Chile Consideration Shares from escrow. As of the date of
this report, the Chile Consideration shares remain in
escrow.


- 7
-


PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


January
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)





4.  Plant
and Equipment, Net




Plant and
equipment are recorded at cost less accumulated
depreciation.  Depreciation is provided commencing in the month
following acquisition using the following annual rate and method:




Computer
      equipment
                    30%
                    declining
      balance methodOffice
      furniture and fixtures
                    20%
                    declining
      balance methodOperating
      equipment
                    30%
                    declining
      balance
method




January
      31,2009
                                
                                
                                October
      31, 2008Accumulated
                                
                                
                                
                                
                                
                                AccumulatedCost
                                
                                
                                Depreciation
                                
                                
                                Cost
                                
                                
                                Depreciation$
                                
                                
                                $
                                
                                
                                $
                                
                                
                                $Office,
      furniture and fixtures
                                
                                
                                386
                                
                                
                                
                                151
                                
                                
                                
                                386
                                
                                
                                
                                132Computer
      equipment
                                
                                
                                6,529
                                
                                
                                
                                2,245
                                
                                
                                
                                6,529
                                
                                
                                
                                1,790Operating
      equipment
                                
                                
                                191,185
                                
                                
                                
                                55,550
                                
                                
                                
                                191,185
                                
                                
                                
                                40,735198,100
                                
                                
                                
                                57,946
                                
                                
                                
                                198,100
                                
                                
                                
                                42,657Net
      carrying amount
                                
                                $
                                140,154
                                
                                
                                
                                
                                
                                
                                $
                                155,443




5. Issuance
of Common Shares





Year ended October 31,
2008





Three months ended January
31, 2008





On
December 17, 2007, Pacific Copper completed the acquisition of Peru SRL pursuant
to the Share Exchange Agreement among the Company, Peru SRL and the former
partners of Peru SRL dated as of April 11, 2007 (the “Peru
Agreement”).  Pursuant to the Peru Agreement, the Company issued
4,850,000 shares of the Company’s common stock (the “Peru Consideration Shares”)
to the partners of Peru SRL as consideration for the acquisition of 99% of Peru
SRL.  As a result of the acquisition, Peru SRL became a subsidiary of
the Company.  The Peru Consideration Shares were issued in escrow
subject to a Closing and Escrow Agreement dated December 14, 2007 among the
Company, Peru SRL and the former partners of Peru SRL (the “Peru Closing
Agreement”).  Pursuant to the terms of the Peru Closing Agreement, the
former partners of Peru SRL must satisfy certain post-closing items, prior to
the release of the Peru Consideration Shares from escrow, which has not yet
occurred.  The Company capitalized $200 and expensed the balance
consideration of $2,424,800 relating to the issue of shares for acquisition of
mineral properties of Peru SRL, calculated at $0.50 per share (See Note 8,
“Mining Claims”, below).  As of the date of this report, the Peru
Consideration Shares remain in escrow.


- 8
-


PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


January
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)




5. Issuance
of Common Shares –Cont’d





Year ended October 31,2008





On
January 8, 2008, Pacific Copper acquired Pacific LTDA pursuant to a Share
Exchange Agreement entered into as of April 11, 2007 (the “Chile Agreement”)
between the Company and the former partners of Pacific LTDA. Pursuant to the
Chile Agreement the Company issued 6,088,452 of its common shares (the “Chile
Consideration Shares”) to the former partners of Pacific LTDA as consideration
for the acquisition of 99% of Pacific LTDA.  As a result of the
acquisition, Pacific LTDA became a subsidiary of the Company.  The
Chile Consideration Shares were issued in escrow subject to a Closing and Escrow
Agreement dated January 8, 2008 among the Company, Pacific LTDA and the former
partners of Pacific LTDA (the “Chile Closing Agreement”).  Pursuant to
the terms of the Chile Closing Agreement, the former partners of Pacific LTDA
must satisfy certain post-closing items prior to the release of the Chile
Consideration Shares from escrow, which has not yet occurred.  The
Company capitalized $400 and expensed the balance consideration of $3,043,826
relating to the acquisition of mineral properties of Pacific LTDA as project
expense, calculated at $0.50 per share (See Note 8 “Mining Claims”,
below).  As of the date of this report, the Chile Consideration Shares
remain in escrow.





Three months ended April 30,
2008





The
Company, through private placements, issued 3,157,143 units at a price of $0.35
per unit. Each unit consisted of one common share and one half a common share
purchase warrant.  Each full warrant is exercisable for one common
share at $0.50 per share on or before April 30, 2010.  The private
placement was undertaken entirely outside the United States pursuant to
Regulation S.  The Company accrued share issuance expense of $77,350
as a finder’s fee for introduction to subscribers who purchased 3,157,143 units
for a total investment of $1,105,000 in the above private placements.  The
Company also issued to the finder a warrant to purchase 45,000 shares at $0.50
per share on or before April 30, 2010.





Three monthsendedJuly 31, 2008





The
Company, through private placements, issued 743,572 units at a price of $0.35
per unit during the months of June and July 2008. Each unit consisted of one
common share and one half a common share purchase warrant. Each full warrant is
exercisable for one common share at $0.50 per share for a period of 2 years from
the date of issuance.  The private placement was exempt from
registration under the Securities Act of 1933, as amended (the “Act”), pursuant
to Regulation S promulgated thereunder (“Regulation S”).  The Company
expensed share issuance expense of $13,370 being total finder’s fees. 
The Company also issued to the finders a warrant to purchase 13,000 shares at
$0.50 per share on or before two years from date of issuance.


- 9
-


PACIFIC
COPPER CORP.


(AN
EXPLORATION STAGE MINING COMPANY)


Condensed
Notes to Interim Consolidated Financial Statements


January
31, 2009


(Amounts
expressed in US Dollars)


(Unaudited-Prepared
by Management)




5.
            Issuance
      of Common Shares –Cont’d





Year ended October 31,2008





Three monthsendedOctober 31, 2008





The
Company, through private placements, issued 576,501 units at a price of $0.35
per unit during the months of September and October 2008.  Each unit
consisted of one common share and one half a common share purchase warrant.
 Each full warrant is exercisable for one common share at $0.50 per share
for a period of two years from the date of issuance.  The private
placement was exempt from registration under the Securities Act pursuant to
Regulation S.





Three months ended January
31, 2009





The
Company did not raise any capital during the three month period ended January
31, 2009.





6.
            Stock
      Purchase Warrants





During
the year ended October 31, 2008, the Company issued the following warrants to a
consultant:





On August
13, 2008, the Company entered into an advisory consulting agreement with Jesup
& Lamont Sec. Corp. (“Consultant”).  Pursuant to this agreement,
Consultant agreed to provide and perform for the benefit of the Company certain
consulting services. The Company issued to the consultant a warrant to purchase
500,000 common shares at a price of $0.50 per share and exercisable for a period
of five years.  The term of this agreement was for a period of 6
months.  The Company expensed the entire compensation cost for the
issue of these warrants for $129,034 which vested during the year ended October
31, 2008.  The fair value of the warrants was estimated on the grant
date using the Black-Scholes option-pricing model.





No
warrants were issued during the three month period ended January 31,
2009.


- 10
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
 
 6.
              Stock
      Purchase Warrants-Cont’d
 
 Number
      of
                              Warrants
                              Granted
                            
                            
                            Exercise
      Prices
                            
                            
                            Expiry
      Date$Outstanding
      at October 31, 2007 and average exercise price
                            
                            
                            4,318,100
                            
                            
                            
                            0.70Granted
      in year 2008
                            
                            
                            1,623,571
                            
                            
                            
                            0.50
                            
                            
                            4/30/2010Granted
      in year 2008
                            
                            
                            175,857
                            
                            
                            
                            0.50
                            
                            
                            6/06/2010Granted
      in year 2008
                            
                            
                            208,928
                            
                            
                            
                            0.50
                            
                            
                            7/30/2010Granted
      in year 2008
                            
                            
                            253,248
                            
                            
                            
                            0.50
                            
                            
                            9/12/2010Granted
      in year 2008
                            
                            
                            500,000
                            
                            
                            
                            0.50
                            
                            
                            9/23/2013Granted
      in year 2008
                            
                            
                            35,000
                            
                            
                            
                            0.50
                            
                            
                            10/24/2010Outstanding
      at October 31, 2008 and average exercise price
                            
                            
                            7,114,704
                            
                            
                            
                            0.62Granted
      in year 2009
                            
                            
                            -
                            
                            
                            
                            -Outstanding
      at January 31, 2009and
      average exercise price
                            
                            
                            7,114,704
                            
                            
                            
                            0.62
  The
warrants do not confer upon the holders any rights or interest as a shareholder
of the Company
  7.
              Stock Based
      Compensation
 
 On August
8, 2006, the Board of Directors approved stock option plan ("2006 Stock Option
Plan"), the purpose of which is to enhance the Company's stockholder value and
financial performance by attracting, retaining and motivating the Company's
officers, directors, key employees, consultants and its affiliates and to
encourage stock ownership by such individuals by providing them with a means to
acquire a proprietary interest in the Company's success through stock
ownership.  Under the 2006 Stock Option Plan, officers, directors,
employees and consultants who provide services to the Company may be granted
options to acquire common shares of the Company.  Options may have a
term of up to 10 years.  The aggregate number of
shares of common stock originally authorized under the plan was
5,000,000.Since adoption of the Plan an
additional 600,000 shares were authorized for issuance pursuant to the Plan’s
“evergreen share reserve increase” provision.
  - 11
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  7.
              Stock Based
      Compensation-Cont’d
  During
the three month period ended January 31, 2009, no options were
granted.
  During
the year ended October 31, 2008, the Board granted the following stock
options:
 
 a)
              On
      February 20, 2008, stock options to purchase 250,000 common shares at an
      exercise price of $0.40 per share were issued to a
      consultant.  These options were granted in accordance with the
      terms of the Company’s 2006 Stock Option Plan and shall vest immediately
      on date of grant.  These options were granted for a term of 2
      years.
  b)
              In
      March 1, 2008, the Board granted stock options to a consultant to purchase
      100,000 common shares and to another two consultants to purchase 10,000
      common shares each.  The Board also granted stock options to
      employees of Kriyah Consultants LLC (“Kriyah”), who perform administrative
      and geological services for the Company in the following amounts: two
      persons received options to purchase 70,000 common shares each, three
      persons received options to purchase 50,000 common shares each and two
      persons received options to purchase 40,000 common shares each. The
      foregoing option grants totaled 490,000 options.  The exercise
      price for all these options was $0.50 per share.  These options
      were granted in accordance with the terms of the Company’s 2006 Stock
      Option Plan and shall vest 50% at the end of year one commencing grant of
      options and the balance 50% at the end of year two commencing grant of the
      options.
  c)
              On
      May 15, 2008, stock options to purchase 200,000 common shares at an
      exercise price of $0.35 per share were issued to a
      consultant.  These options were granted in accordance with the
      terms of the Company’s 2006 Stock Option Plan and shall vest on the third
      month from the date granted. These options were granted for a term of 2
      years.
  d)
              On
      September 24, 2008 stock options to purchase 50,000 common shares at an
      exercise price of $0.50 per share were issued to an employee of Kriyah,
      who performs administrative and geological services for the Company.
       These options were granted in accordance with the terms of the
      Company’s 2006 Stock Option Plan and shall vest 50% at the end of year one
      commencing grant of options and the balance 50% at the end of year two
      commencing grant of the options.
 
 The
Company has adopted SFAS123 (Revised) commencing July 1, 2005.
 
 The fair
value of each grant was estimated at the grant date using the Black-Scholes
option-pricing model.  The Black-Scholes option pricing model requires
the use of certain assumptions, including expected terms, expected volatility,
expected dividends and risk-free interest rate to calculate the fair value of
stock-based payment awards.  The assumptions used in calculating the
fair value of stock option awards involve inherent uncertainties and the
application of management judgment.  For the year ended October 31,
2008, the Company has recognized in its financial statements, stock-based
compensation costs as per the following details.  The fair value of
each option used for the purpose of estimating the stock compensation is based
on the grant date using the Black-Scholes option pricing model with the
following weighted average assumptions:
  - 12
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  7.
              Stock Based
      Compensation-Cont’d
 
 Date
      of grant
                                                    
                                                    14-May
                                                    
                                                    
                                                    20-Jul
                                                    
                                                    
                                                    1-Aug
                                                    
                                                    
                                                    9-Aug
                                                    
                                                    
                                                    20-Feb
                                                    
                                                    
                                                    1-Mar
                                                    
                                                    
                                                    15-May
                                                    
                                                    
                                                    24-Sep2007
                                                    
                                                    
                                                    2007
                                                    
                                                    
                                                    2007
                                                    
                                                    
                                                    2007
                                                    
                                                    
                                                    2008
                                                    
                                                    
                                                    2008
                                                    
                                                    
                                                    2008
                                                    
                                                    
                                                    2008
                                                    
                                                    
                                                    TotalRisk
      free rate
                                                    
                                                    
                                                    4.50
                                                    %
                                                    
                                                    
                                                    4.50
                                                    %
                                                    
                                                    
                                                    4.50
                                                    %
                                                    
                                                    
                                                    4.50
                                                    %
                                                    
                                                    
                                                    5.00
                                                    %
                                                    
                                                    
                                                    5.00
                                                    %
                                                    
                                                    
                                                    5.00
                                                    %
                                                    
                                                    
                                                    2.95
                                                    %Volatility
      factor
                                                    
                                                    
                                                    50
                                                    %
                                                    
                                                    
                                                    50
                                                    %
                                                    
                                                    
                                                    50
                                                    %
                                                    
                                                    
                                                    50
                                                    %
                                                    
                                                    
                                                    100
                                                    %
                                                    
                                                    
                                                    98
                                                    %
                                                    
                                                    
                                                    86
                                                    %
                                                    
                                                    
                                                    84
                                                    %Expected
      dividends
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %Forfeiture
      rate
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %
                                                    
                                                    
                                                    0
                                                    %Expected
      life
                                                    
                                                    5
      years
                                                    
                                                    
                                                    5
      years
                                                    
                                                    
                                                    5
      years
                                                    
                                                    
                                                    5
      years
                                                    
                                                    
                                                    2
      years
                                                    
                                                    
                                                    5
      years
                                                    
                                                    
                                                    5
      years
                                                    
                                                    
                                                    5
      yearsExercise
      price
                                                    
                                                    $
                                                    0.50
                                                    
                                                    
                                                    $
                                                    0.50
                                                    
                                                    
                                                    $
                                                    0.50
                                                    
                                                    
                                                    $
                                                    0.51
                                                    
                                                    
                                                    $
                                                    0.40
                                                    
                                                    
                                                    $
                                                    0.50
                                                    
                                                    
                                                    $
                                                    0.35
                                                    
                                                    
                                                    $
                                                    0.50Total
      number of options granted
                                                    
                                                    
                                                    1,750,000
                                                    
                                                    
                                                    
                                                    250,000
                                                    
                                                    
                                                    
                                                    1,700,000
                                                    
                                                    
                                                    
                                                    650,000
                                                    
                                                    
                                                    
                                                    250,000
                                                    
                                                    
                                                    
                                                    490,000
                                                    
                                                    
                                                    
                                                    200,000
                                                    
                                                    
                                                    
                                                    50,000
                                                    
                                                    
                                                    
                                                    5,340,000Total
      number of options forfeited/cancelled/Expired/Exercised
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (110,000
                                                    )
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (110,000
                                                    )Grant
      date fair value
                                                    
                                                    $
                                                    0.24
                                                    
                                                    
                                                    $
                                                    0.24
                                                    
                                                    
                                                    $
                                                    0.24
                                                    
                                                    
                                                    $
                                                    0.24
                                                    
                                                    
                                                    $
                                                    0.22
                                                    
                                                    
                                                    $
                                                    0.27
                                                    
                                                    
                                                    $
                                                    0.25
                                                    
                                                    
                                                    $
                                                    0.13Stock-based
      compensation cost expensed during the year ended October 31,
      2008
                                                    
                                                    $
                                                    223,699
                                                    
                                                    
                                                    $
                                                    37,822
                                                    
                                                    
                                                    $
                                                    160,333
                                                    
                                                    
                                                    $
                                                    119,059
                                                    
                                                    
                                                    $
                                                    54,618
                                                    
                                                    
                                                    $
                                                    34,594
                                                    
                                                    
                                                    $
                                                    49,504
                                                    
                                                    
                                                    $
                                                    342
                                                    
                                                    
                                                    $
                                                    679,971Unexpended  Stock
      -based compensation cost deferred over the vesting period
                                                    
                                                    $
                                                    nil
                                                    
                                                    
                                                    $
                                                    8,599
                                                    
                                                    
                                                    $
                                                    200,418
                                                    
                                                    
                                                    $
                                                    nil
                                                    
                                                    
                                                    
                                                    $nil
                                                    
                                                    
                                                    $
                                                    69,091
                                                    
                                                    
                                                    $
                                                    nil
                                                    
                                                    
                                                    $
                                                    6,226
                                                    
                                                    
                                                    $
                                                    284,334
 
 As of
October 31, 2008 there was $284,334 of unrecognized expenses related to
non-vested stock-based compensation arrangements granted.  The
stock-based compensation expense for the year ended October 31, 2008 was
$679,971.
  During the three month
period ended January 31, 2009, no new stock options were
issued.
 
 For the
three-month period ended January 31, 2009, the Company has recognized in its
financial statements, stock-based compensation costs as per the following
details.  The fair value of each option used for the purpose of
estimating the stock compensation is based on the grant date using the
Black-Scholes option pricing model with the following weighted average
assumptions.
  - 13
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  7.
                Stock
      based compensation-cont’d
  
 Date of
      grant
                        
                        14-May
                        
                        
                        20-Jul
                        
                        
                        1-Aug
                        
                        
                        9-Aug
                        
                        
                        20-Feb
                        
                        
                        1-Mar
                        
                        
                        15-May
                        
                        
                        24-Sep2007
                        
                        
                        2007
                        
                        
                        2007
                        
                        
                        2007
                        
                        
                        2008
                        
                        
                        2008
                        
                        
                        2008
                        
                        
                        2008
                        
                        
                        TotalRisk
      free rate
                        
                        
                        4.50
                        %
                        
                        
                        4.50
                        %
                        
                        
                        4.50
                        %
                        
                        
                        4.50
                        %
                        
                        
                        5.00
                        %
                        
                        
                        5.00
                        %
                        
                        
                        5.00
                        %
                        
                        
                        2.95
                        %Volatility
      factor
                        
                        
                        50
                        %
                        
                        
                        50
                        %
                        
                        
                        50
                        %
                        
                        
                        50
                        %
                        
                        
                        100
                        %
                        
                        
                        98
                        %
                        
                        
                        86
                        %
                        
                        
                        84
                        %Expected
      dividends
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %Forfeiture
      rate
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %
                        
                        
                        0
                        %Expected
      life
                        
                        5
      years
                        
                        
                        5
      years
                        
                        
                        5
      years
                        
                        
                        5
      years
                        
                        
                        2
      years
                        
                        
                        5
      years
                        
                        
                        5
      years
                        
                        
                        5
      yearsExercise
      price
                        
                        $
                        0.50
                        
                        
                        $
                        0.50
                        
                        
                        $
                        0.50
                        
                        
                        $
                        0.51
                        
                        
                        $
                        0.40
                        
                        
                        $
                        0.50
                        
                        
                        $
                        0.35
                        
                        
                        $
                        0.50Total
      number of options granted
                        
                        
                        1,750,000
                        
                        
                        
                        250,000
                        
                        
                        
                        1,700,000
                        
                        
                        
                        650,000
                        
                        
                        
                        250,000
                        
                        
                        
                        490,000
                        
                        
                        
                        200,000
                        
                        
                        
                        50,000
                        
                        
                        
                        5,340,000Total
      number of options forfeited/cancelled/Expired/Exercised
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        (110,000
                        )
                        
                        
                        -
                        
                        
                        
                        -
                        
                        
                        
                        (110,000
                        )Grant
      date fair value
                        
                        $
                        0.24
                        
                        
                        $
                        0.24
                        
                        
                        $
                        0.24
                        
                        
                        $
                        0.24
                        
                        
                        $
                        0.22
                        
                        
                        $
                        0.27
                        
                        
                        $
                        0.25
                        
                        
                        $
                        0.13Stock-based
      compensation cost expensed during the three month period ended January 31,
      2009
                        
                        $
                        nil
                        
                        
                        $
                        3,031
                        
                        
                        $
                        48,100
                        
                        
                        $
                        nil
                        
                        
                        $
                        nil
                        
                        
                        $
                        12,952
                        
                        
                        $
                        nil
                        
                        
                        $
                        821
                        
                        
                        $
                        64,904Unexpended  Stock
      -based compensation cost deferred over the vesting period
                        
                        $
                        nil
                        
                        
                        $
                        5,568
                        
                        
                        $
                        152,318
                        
                        
                        $
                        nil
                        
                        
                        $
                        nil
                        
                        
                        $
                        56,139
                        
                        
                        $
                        nil
                        
                        
                        $
                        5,405
                        
                        
                        $
                        219,430
  - 14
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
 
 7.          Stock
Based Compensation-cont’d
 
 As of
January 31, 2009 there was $219,430 of unrecognized expenses related to
non-vested stock-based compensation arrangements granted.  The
stock-based compensation expense for the three month period ended January 31,
2009 was $64,904.
 
 8.          Mining
Claims
 
 (a)          On
December 17, 2007, Pacific Copper acquired Peru SRL, pursuant to the Share
Exchange Agreement among the Company, Peru SRL and the former partners of Peru
SRL dated as of April 11, 2007, as amended (the “Peru Agreement”). Pursuant
to the Peru Agreement, the Company issued 4,850,000 shares of the Company’s
common stock (the “Peru Consideration Shares”) to the partners of Peru SRL as
consideration for the acquisition of 99% of Peru SRL.  The 1% minority
interest was credited with $24,495.  As a result of the acquisition, Peru
SRL became a subsidiary of the Company. The Company expensed $2,449,295,
relating to the issue of 4,850,000 common shares calculated at $0.50 per common
share and the allocation of minority interest for $24,495 net of capitalization
for $200 for mineral property claims. Property acquisition costs relating to the
exploration properties are being expensed until the economic viability of the
project is determined and proven and probable reserves quantified.  In
the absence of proven and probable reserves, the Company is unable to allocate
any economic values to the claims.  The Company does not consider either of
the mineral claim groups acquired in the transaction (as listed below) to be
material assets at this time, but our assessment may change after further work
is done on the properties.  Pursuant to this acquisition the Company
acquired interests in the following mineral claims which were capitalized at
$100 each:
 
 Tonalia
(subject to the completion of the formal documentation)
 Don
Javier (subject to the completion of formal documentation)
 
 (b)          On
January 8, 2008, Pacific Copper acquired Pacific LTDA, pursuant to a Share
Exchange Agreement entered into as of April 11, 2007 (the “Chile Agreement”), as
amended, between the Company and the former partners of Pacific
LTDA.  Pursuant to the Chile Agreement the Company issued 6,088,452 of
its common shares (the “Chile Consideration Shares”) to the former partners of
Pacific LTDA as consideration for the acquisition of 99% of Pacific
LTDA.  The 1% minority interest was credited with
$30,750.  As a result of the acquisition, Pacific LTDA became a
subsidiary of the Company.  The Company expensed $3,074,576, relating
to the issue of 6,088,452 common shares calculated at $0.50 per common share and
the allocation of minority interest for $30,750 net of capitalization for $400
for mineral property claims.  Property acquisition costs relating to
the exploration properties are being expensed until the economic viability of
the project is determined and proven and probable reserves
quantified.  In the absence of proven and probable reserves, the
Company is unable to allocate any economic values to the claims groups acquired
in the transaction (as listed below).  The Company does not consider
either of the foregoing mineral claims to be material assets at this time, but
our assessment may change after further work is done on the
properties.  Pursuant to this acquisition the Company acquired
interest in the following mineral claims which were capitalized at $100
each:
 
 Carrera
Pinto
 Carrizal
 Cerro
Blanco
 La
Guanaca
 
 (c)           As
of February 27, 2009 the Company entered into a mineral property acquisition
agreement with Gareste Limitada, a Chilean limited liability partnership
pursuant to which it acquired certain copper oxide properties in Atacama Region
III, Chile.  See Footnote 17, “Subsequent Events” below for more
information.
  - 15
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  9.
              Commitments
      and Contingencies
 
 On June
1, 2007, the Company entered into an agreement with Sweetwater Capital
Corporation, a private company with a director in common with the Company
(“Sweetwater”) for a term of 24 months to provide financial public relations,
business promotion, business growth and development consulting services,
including consultation regarding mergers and acquisitions, and general business
consultation.  The Company will pay Sweetwater $4,000 per month plus
1,000,000 restricted shares of the Company's common stock that will be earned in
equal installments of 250,000 shares on December 1, 2007, March 1, 2008, June 1,
2008 and September 1, 2008.  The said 1,000,000 shares of restricted
Common stock of the Company were tendered in one certificate on June 1,
2007.  The consultant must return any unearned shares upon early
termination of the agreement.  Either the consultant or the Company
may terminate the agreement with or without cause upon sixty (60) days written
notice to the other provided that the Company may not give notice of
cancellation before January 1, 2007.
 
 On April
19, 2007, the Company executed an agreement dated as of April 11, 2007 with
David Hackman, a director of the Company, on behalf of a corporation to be
formed in Peru which, prior to closing, would then own certain mineral claims
located in Peru.  On December 17, 2007, Pacific Copper completed the
acquisition of Peru SRL, pursuant to the Share Exchange Agreement among the
Company, Peru SRL and the former partners of Peru SRL dated as of April 11,
2007.  The 4,850,000 shares of the Company’s common stock issued in
connection with the closing of this transaction are held in escrow subject to
the satisfaction of certain post-closing conditions.
 
 On April
19, 2007 the Company executed an agreement dated as of April 11, 2007 with
Harold Gardner, a director of the Company, on behalf of a corporation to be
formed in Chile which, prior to closing, would then own certain mineral claims
located in Chile.  On January 8, 2008, Pacific Copper acquired Pacific
LTDA pursuant to a Share Exchange Agreement entered into as of April 11, 2007
between the Company and the former partners of Pacific LTDA. The 6,088,452
shares of the Company’s common stock issued in connection with the closing of
this transaction are held in escrow subject to the satisfaction of certain
post-closing conditions.
 
 On August
9, 2007 the Company and Andrew A. Brodkey executed an employment agreement
pursuant to which the Company retained Mr. Brodkey as President and Chief
Executive Officer.  The Employment Agreement has a two-year term that
commenced on August 1, 2007 and will continue until August 1, 2009 unless
terminated earlier pursuant to the terms of the Employment
Agreement.  Mr. Brodkey’s base salary is $132,000 per
year.  Upon certain events of termination Mr. Brodkey would be
entitled to a maximum of one year’s salary as a severance
payment.  Under the employment agreement, Mr. Brodkey is permitted to
pursue other business opportunities.
 
 On August
22, 2007 the Company entered into an agreement with Kriyah for the performance
of certain administrative and management services.   The
Kriyah Agreement has an initial term of two years and is then automatically
renewable.  Either party may terminate the Kriyah Agreement upon 60 days
prior written notice.  Under the Kriyah Agreement, Kriyah received an
initial payment of $57,504 and will receive payments of $4000 each month
thereafter.  Commencing in January of 2009, this amount was reduced to
$2500 per month.  In order to facilitate the retaining of Kriyah, the
Company guaranteed a lease agreement for the office space used by Kriyah in
Tucson, Arizona.  The Company’s maximum obligation under the lease
guarantee, as of January 31, 2009, would be $246,608.52 in the event of a lease
default with full acceleration of rent.  Kriyah’s Manager, Andrew A.
Brodkey, is also the President and CEO of the Company.
  - 16
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  9.
              Commitments
      and Contingencies-Cont’d
 
 On
September 1, 2007, the Company entered into a Payroll Service Agreement with
Kriyah to administer payroll and health insurance benefits to Andrew A. Brodkey,
President and CEO of the Company, as contemplated in his Employment Agreement
with the Company dated August 1, 2007 (“Employment Agreement”).  The
Company shall reimburse Kriyah monthly for all direct costs for wages, covered
by the Employment Agreement and health benefits provided by Kriyah and invoiced
to the Company for Mr. Brodkey.
 
 On August
16, 2007, the Company entered into an agreement with Hydro Geophysics Inc.
(“HGI”).  Pursuant to this agreement, HGI provided certain mineral
exploration, analytical and consulting services to the Company, as requested
from time to time, with respect to the Company’s South American
projects.  This contract  expired on February 16, 2009. The
Company remains obligated for the payment of an aggregate of $89,212 of unpaid
invoices under this contract.
 
 On
January 24, 2008, the Company, through its subsidiary Pacific LTDA entered into
an exclusive exploration, mining and exploitation agreement (the "Guanaca
Lease") for the La Guanaca oxide copper project located northeast of the town of
Inca de Oro, Chanaral Province, Atacama Region 3, Chile.  This
property, which consists of approximately 300 hectares of exploration
concessions, is road-accessible and was previously explored in the mid-1990's
through geophysical methods, sampling and drilling by Empresa Nacional de
Mineria ("ENAMI") a Chilean nationally-owned mining enterprise.  The
Guanaca Lease is for a term of 5 years and is renewable automatically for
additional 5-year periods.  The owners of the La Guanaca property will
receive US$2,000 per month in cash during the term of the
agreement.
 
 On
February 12, 2008, the Company’s subsidiary, Pacific LTDA, entered into an
Operator Agreement (the “Chile Operator Agreement”) with Gareste Limitada, a
limited liability partnership organized under the laws of Chile
(“Gareste”).  Pursuant to the Chile Operator Agreement Gareste will
prepare and submit proposed annual work programs and accompanying budgets to
Pacific LTDA covering the exploration and, if warranted, development of certain
mineral concessions held by Pacific LTDA.  Gareste will provide
comprehensive management services and contract for transportation, labor,
insurance and logistical services for all approved
programs.  Gareste’s overhead reimbursement and compensation will be
specified in each proposed budget and subject to approval by Pacific
LTDA.  The Chile Operator Agreement is terminable by either party upon
90-days’ prior notice.  Harold Gardner, a member of the Company’s
board of directors, is a partner in Gareste.
 
 On
February 12, 2008 The Company’s subsidiary, Peru SRL entered into an Operator
Agreement (the “Peru Operator Agreement”) with Inversiones Mineras Stiles, a
limited liability partnership organized under the laws of Peru
(“Stiles”).  Pursuant to the Peru Operator Agreement Stiles will
prepare and submit proposed annual work programs and accompanying budgets to
Peru SRL covering the exploration and, if warranted, development of certain
mineral concessions held by Peru SRL. Stiles will provide comprehensive
management services and contract for transportation, labor, insurance and
logistical services for all approved programs.  Stiles’ overhead
reimbursement and compensation will be specified in each proposed budget and
subject to approval by Peru SRL.
  - 17
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  9.
              Commitments
      and Contingencies-Cont’d
 
 On
February 28, 2008 the Company entered into an agreement with Michael A. McClave
(“Consultant”).  Pursuant to this agreement, Consultant will provide
certain mineral exploration, geological and consulting services to the Company,
as requested from time to time.  Pacific Copper will be invoiced on a
monthly basis for services rendered on the projects.  Either party can
terminate this agreement by giving 30 days notice with or without
cause.
 
 On May
15, 2008, the Company entered into a consulting and professional services
agreement with Jehcorp Inc. (“Consultant”).  Pursuant to this
agreement, Consultant agrees to provide and perform for the benefit of the
Company certain expert technical consulting services, specifically including,
but not limited to, the preparation of a Canadian National Instrument NI-43-101
Technical Report for various properties owned or controlled by the Company and
its subsidiaries in Peru and Chile.  The Company will be invoiced on a
monthly basis for services rendered and the Consultant was advanced
$5,000.
 
 The
Company, through Pacific LTDA, also executed a letter of intent with
Gareste to acquire its interest in the “Yerbas Buenas” oxide copper property
located 130 km southeast of the city of Copiapo, Atacama Region III,
Chile.  Yerbas Buenas is located roughly 20 km from the El Corral
property.  The letter of intent contemplates that Gereste will receive
2 million shares of the Company at closing in exchange for its interest at
Yerbas Buenas, and a 2% NSR royalty, capped at $6 million, 1% of which can be
repurchased for the sum of $2 million at any time prior to commercial
production.  As of the date of this report, the Company and Gareste
have postponed performance under this letter of intent due to the current copper
market conditions and general economic decline worldwide.
 
 On June
10, 2008 the Company executed an agreement with Eagle Mapping Ltd. for providing
services for a total consideration payable for $52,200.
 
 On August
14, 2008, the Company entered into a consulting services agreement with Yellow
Rose Ltd., to provide business and financial consulting relating to the European
markets.  The term of this agreement is for a period of 12
months.  A consulting fee of up to $20,000 is billable from the
consultant during the term of this agreement. As of January 31, 2009, the
consultant had billed the Company $10,000.
 
 On
October 28, 2008, the Company received a cease trade order (the “CTO”) from the
British Columbia Securities Commission (the “BCSC”), the effect of which is
limited to the Province of British Columbia.  By its terms, the CTO
was issued for not filing a technical report under Canadian National Instrument
43-101 Standards of Disclosure
for Mineral Projects(“NI 43-101”) with respect to its material copper
oxide projects in Chile after having made public disclosures regarding such
properties.  The Company has engaged counsel in British Columbia and
is in the process of obtaining and filing the reports and information required
by the BCSC and otherwise satisfying the requirements of British Columbia
law.  As of the date of this report, this matter has not been resolved
and the CTO is in effect. The financial impact of the CTO is
unknown.
  - 18
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
 
 10.   Related
Party Transactions
 
 Three month period ended
January 31, 2009
  The
following transactions were undertaken in the normal course of operations and
are measured at the exchange amount, which is the amount of consideration
established and agreed to by the related parties.
 A)
              During
      the three month period ended January 31, 2009, the Company expensed
      stock based compensation for $48,100 relating to the vesting of the stock
      options issued in years 2007 and 2008 to its
  director.
 
 B)
              A
      director of the Company provided consulting geological services to the
      Company and a total of $22,500 was expensed to a private Company with
      director in common.  $52,500 was owed to this private company as
      of January 31, 2009.
 
 C)
              A
      director of the Company provided consulting services to the Company and a
      total of $22,500 was expensed to a private company with director in
      common.  $145,849 was owed to this private company as of January
      31, 2009 which also includes non-reimbursed
  expenses.
 
 D)
              The
      President, CEO, Director and Chairman of the Board of Directors of the
      Company, was paid $34,865 by Kriyah, including benefits which was charged
      to the Company.
 
 E)
              The
      Secretary of the Company is an employee of Kriyah and was paid $6,856 by
      Kriyah, including payroll burden and benefits that was charged to the
      Company.
 
 F)
              The
      Company expensed $3,500 for services rendered to the Company by an officer
      of the Company.
 
 G)
              On
      June 1, 2007, the Company entered into an agreement with Sweetwater
      Capital Corporation, a private company with a director in common with the
      Company (“Sweetwater”) for a term of 24 months to provide financial public
      relations, business promotion, business growth and development consulting
      services, including consultation regarding mergers and acquisitions, and
      general business consultation.  The Company expensed $29,200 for
      the three month period ended January 31, 2009 and also amortized deferred
      stock compensation expense for $62,500 relating to issue of 1,000,000
      restricted shares of the Company's common stock that was earned during the
      three month period ended January 31,
2009.
 
 H)
              The
      Company incurred a total of $411,553 to a private Chilean company that
      provides exploration services to the  Company in Chile, and has
      a director in common, of which $203,857 was owed at January 31, 2009 with
      such costs recorded as project
costs.
  The
Company received an advance of $70,000 from War Eagle Mining Company, Inc. a
Company related through a common director.  This amount was advanced
interest free against a demand promissory note.  Subsequent to the
quarter ended January 31, 2009, the Company issued a secured promissory note
with War Eagle Mining Company, Inc. which replaced the prior unsecured demand
note.  Certain of the Company’s obligations under this promissory note
are in dispute.  For more information please see Note 17, “Subsequent
Events” below.
  - 19
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  11.      Deferred
Stock Compensation
 
 The
Company issued 1,000,000 restricted common shares each to three consultants, for
a total of 3,000,000 common shares valued at $1,500,000.  The Company
has expensed proportionate consulting expenses of $1,416,667 until January 31,
2009 and the balance of $83,333 is reflected as a deferred stock compensation
expense under shareholders’ equity in the balance sheet.
  12.      Advances
to a related party
  Advances
to a related party include a net receivable of $25,000, after providing a
reserve for doubtful receivable for $197,000, advanced interest free against a
demand promissory notes to the Company related through common directors and
management.  The Company opted to create a reserve for $197,000 as a
matter of prudence and caution due to the current unfavorable and challenging
general economic conditions. The related party repaid the net receivable of
$25,000 subsequent to January 31, 2009.  Refer to “Subsequent Events”
below.
  13.      Advances
from non-related parties
  On June
20, 2008, the Company received an advance of $246,945 from a non-related party
which bears interest at an annual rate of eight percent and is due and payable
within ninety days from receipt thereof.  The Company received a
further advance of an additional $5,100 on September 30, 2008 from the same
party.  The Company received an additional advance of $100,000 from
this party during the three month period ended January 31,
2009.
  - 20
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  14.           Convertible
note financing transaction
 
 Our
convertible note consisted of the following as of January 31, 2009:
 
 Amount$100,000
      face value, 6% convertible note, due October 31, 2010
                        
                        $
                        37,610
 
 On
October 27, 2008, the Company issued a $100,000 face value, 6% convertible note,
due October 31, 2010.  The principal amount of the note and interest
is payable on October 31, 2010.  While the note is outstanding, the
investor has the option to convert the principal balance and interest, into
conversion units at a conversion price of $0.16 per unit.  Each
conversion unit is convertible into one share of common stock and one warrant to
purchase one share of common stock.  Further, the terms of the
convertible note provide for certain redemption features. If, in the event of
certain defaults on the terms of the note, certain of which are indexed to
equity risks, the holder can accelerate the payment of outstanding principal and
interest.  The financing transaction also provided the holder with
Additional Investment Rights (“AIR”) to purchase up to $800,000 face value
convertible notes under the same terms and conditions as the $100,000
convertible note.
 
 The
Company has evaluated the terms and conditions of the convertible note and the
AIR under the guidance of SFAS No. 133 and EITF No. 00-19.  The
embedded conversion option, indexed to a share of stock and a warrant, does not
meet the conventional convertible exemption.  The warrant element of
the conversion unit does not otherwise fall within the scope of the “indexed to
the company’s own stock” exemption provided in SFAS No. 133 and required
bifurcation.  Further, certain redemption features that are indexed to
equity risks are not clearly and closely related to the host debt
agreement.  Accordingly, a compound embedded derivative was bifurcated
from the contract and has been recorded as a derivative
liability.  Similarly, the AIR embodies similar features that did not
meet equity classification and accordingly derivative liability classification
of the compound feature is also reflected in liabilities.
  - 21
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
  14.         Convertible
note financing transaction-Cont’d
 
 Fair
value of the compound embedded derivative and embedded warrants in the
additional investment right were measured using the Monte Carlo Simulation
technique and in applying this technique the Company was required to develop
certain subjective assumptions.  Information and significant
assumptions embodied in the valuations (including ranges for certain assumptions
during the subject periods that instruments were outstanding) as of the
inception date and October 31, 2008 are illustrated in the following
table:
 
 October
      27,
                        2008
                      
                      
                      October
      31,
                        2008Conversion
      price
                      
                      $
                      0.29
                      
                      
                      $
                      0.29Volatility
                      
                      
                      78%-84
                      %
                      
                      
                      79%-86
                      %Equivalent
      term (years)
                      
                      
                      3.987
                      
                      
                      
                      3.964Credit-risk
      adjusted yield
                      
                      
                      10.3%-14.0
                      %
                      
                      
                      10.3%-14.0
                      %Interest-risk
      adjusted rate
                      
                      
                      5.0%-5.16
                      %
                      
                      
                      4.8%-5.10
                      %
 
 Since, as
discussed above, the common share element of the conversion option did not
require treatment as derivative financial instruments, the Company was required
to evaluate the feature as potentially embodying a beneficial conversion feature
under EITF No. 98-5 Accounting for Convertible
Securities with Beneficial Conversion Features or Contingently Adjustable
Conversion Ratios and EITF No. 00-27 Application of Issue No.
98-5 to Certain Convertible Instruments. A beneficial conversion feature
is present when the fair value of the underlying common share exceeds the
effective conversion price of the conversion option. The effective conversion
price is calculated as the basis in the financing arrangement allocated to the
hybrid convertible debt agreement, divided by the number of shares into which
the instrument is indexed. As a result of this evaluation under the
aforementioned standards, the Company concluded that a beneficial conversion
feature was present in the amount of $5,625 in the $100,000 face value
convertible note.
 
 Discounts
or (premiums) on the convertible notes arise from (i) the allocation of basis to
other instruments issued in the transaction, (ii) fees paid directly to the
creditor and (iii) initial recognition at fair value, which is lower than face
value. Discounts (premiums) are amortized through charges (credits) to interest
expense over the term of the debt agreement. Amortization of debt discounts
(premiums) amounted to ($5,110) during the period for inception to January 31,
2009.
 
 The
derivative liabilities as of January 31, 2009 consisted of the
following:
 
 Derivative
      Financial Instrument
                    
                    AmountCompound
      Embedded Derivative
                    
                    $
                    13,750Additional
      Investment Right (AIR)
                    
                    
                    110,000$
                    123,750
  - 22
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
 
 15.     
Project expenses
  During
the three month period ended January 31, 2009, the Company incurred project
related expenses on the following mineral claims in Chile:
 
 Corral
      (Chile)
                        
                        $
                        4,620Carrera
      Pinto (Chile)
                        
                        $
                        7,310Carrizal
      (Chile)
                        
                        $
                        955La
      Mofralla (Chile)
                        
                        $
                        3,937La
      Guanaca (Chile)
                        
                        $
                        8,406Venapai
      (Chile)
                        
                        $
                        229,721Yerbas
      Buenas (Chile)
                        
                        $
                        236,613Total
                        
                        $
                        491,563
 
 The above
expenses include consulting, claims, equipment rentals, contract labor, field
wages, drilling and other project related expenses.
  16.     
General and administration expenses
 
 General
and administration expense for the three month period ended January 31, 2009
include the following:
 
 Non-cash
      compensation expense relating to the issue of options and
      warrants
                    
                    $
                    91,641Non
      cash expense relating to the amortization of deferred stock
      compensation relating to issue of stock to
consultants
                    
                    $
                    62,500Legal,
      accounting and audit
                    
                    $
                    72,166Office,
      payroll and other general expenses
                    
                    $
                    116,236Total
                    
                    $
                    342,543
  - 23
-
  PACIFIC
COPPER CORP.
 (AN
EXPLORATION STAGE MINING COMPANY)
 Condensed
Notes to Interim Consolidated Financial Statements
 January
31, 2009
 (Amounts
expressed in US Dollars)
 (Unaudited-Prepared
by Management)
 
 17.      Subsequent Events
  Subsequent
events not already reported in these financial statements are as
follows:
 
 Subsequent
to the quarter ended January 31, 2009, a related party repaid an amount of
$25,000 (refer to note 12 to the financial statements).
 
 Subsequent
to the quarter ended January 31, 2009, on February 17, 2009, Pacific Copper
issued a secured promissory note (the “War Eagle Note”) to War Eagle Mining
Company, Inc. a Canadian corporation (“War Eagle”).  War Eagle and the
Company share a common director.  The War Eagle Note has a face amount
of $155,000 which includes amounts previously advanced to the
Company.  Pursuant to the War Eagle Note, War Eagle agreed to make
advances of credit to Kriyah for the benefit of Pacific
Copper.  Kriyah performs administrative services for Pacific Copper
and also shares office space with War Eagle and Pacific Copper.  Upon
execution of the War Eagle Note, an initial advance of $15,000 was made to
Kriyah for the benefit of the Company, with subsequent  advances of
$15,000 to be made on the 1st day of
the months of February, March, April, and May of 2009, and a final payment of
$10,000 to be made on or before June 1, 2009.  Under the terms of the
War Eagle Note, all amounts advanced are due and payable on June 30, 2009 with
interest at 15% per annum.  The War Eagle Note covers a prior advance
of $70,000 that was received by Pacific Copper on June 22, 2008.  The
principal amount outstanding under the War Eagle Note (beginning with the
initial advance on June 22, 2008) bears interest at 15% per
annum.  The War Eagle Note is secured by a blanket security interest
in all real, personnel, and intangible interests of Pacific Copper associated
with each of the La Guanaca, El Corral, La Mofralla and Venado projects (the
Company’s South American oxide copper properties, as described in this
report).  While War Eagle funded $30,000 on February 17, 2009 pursuant
to the War Eagle Note (bringing the outstanding principal amount to $100,000),
War Eagle has notified the Company that it will not fund the March, April or May
advances or the $10,000 final advance contemplated in the War Eagle Note,
leaving a funding shortfall of $55,000.  The Company has notified War
Eagle that it considers this failure to fully fund the War Eagle Note to be a
breach and has reserved all of its legal rights.
 
 Subsequent
to the quarter ended January 31, 2009, as of February 27, 2009, Pacific Copper,
through its wholly owned subsidiary Pacific LTDA, entered into a definitive
mineral property acquisition agreement (the “Gareste Agreement”) with Gareste
pursuant to which the Company acquired a 100% interest in the following copper
oxide properties located in Atacama Region II, Chile: the “Venado Property”
(also known as the “Venapai Property”) consisting of approximately 3600 hectares
of exploration concessions, located roughly 45 kilometers from the city of
Copiapo, the “El Corral Property”, consisting of approximately 4000 hectares of
exploration concessions, located roughly 60 kilometers from the city of Copiapo,
and the adjacent “La Mofralla Property”, consisting of approximately 250
hectares of exploration concessions also located roughly 60 kilometers from the
City of Copiapo.  These properties were subject to separate letters of
intent entered into during July and October of 2008, as previously
disclosed.
 
 Under the
Gareste Agreement the Company is required to issue a total of 5,000,000 shares
of its common stock to Gareste, allocable as follows: 2,000,000 shares of common
stock as consideration for the Venado Property, 2,000,000 shares of common stock
as consideration for the El Corral Property and 1,000,000 shares of common stock
as consideration for the La Mofralla Property.  In addition, the
Venado Property is subject to a 2% net smelter return royalty, capped at
$10,000,000, 50% of which can be repurchased by Pacific Copper at any time prior
to the commencement of production for $3,000,000, and the El Corral Property is
subject to a 2% net smelter return royalty, capped at $10,000,000, 50% of which
can be repurchased by Pacific Copper at any time prior to the commencement of
production for $2,000,000.  As of the date of this report, title to
the properties has been transferred to Pacific LTDA and the closing is in
process.
  - 24
-
  MANAGEMENT'S
DISCUSSION AND ANALYSIS OF
  FINANCIAL
CONDITION AND RESULTS OF OPERATION
  FOR
THE THREE MONTH PERIOD ENDED JANUARY 31, 2009
 
 Discussion
of Operations & Financial Condition
 Three
months ended January 31, 2009
 
 The
Company is in the exploration stage and has not yet realized revenues from any
operations.  The Company has incurred a loss of $890,949 for the
three-month period ended January 31, 2009.  This loss includes a non-cash
stock based compensation expense for $64,904 and non-cash compensation
expense for issue of warrants for $26,737.  At January 31, 2009, the
Company had an accumulated deficit during the exploration stage of
$15,068,264.  During the year ended October 31, 2007, the Company
raised $3,234,450.  During the year ended October 31, 2008, the
Company raised an additional $1,475,815 (net of offering
costs).  Further, during the year ended October 31, 2008, the Company
raised an additional $100,000 from subscriptions for convertible notes (See note
14 to the Company’s financial statements contained in this
report).  The Company did not raise any share capital during the three
months ended January 31, 2009.  Management's plan is to continue
raising additional funds through future equity or debt financing until it
achieves profitable operations from mineral extraction
activities.  There is no assurance that we will be successful in
obtaining such financing.
 
 As of the
date of the filing of this report, the Company has very little
cash.  As of the quarter ended January 31, 2009, the Company’s current
liabilities were $1,267,362 while current assets were
$59,414.  Management has taken steps to reduce operating
costs.  These steps include deferral of salaries for senior
management, deferral of payments to consultants and service providers, and
suspension of all exploration activities.
 
 Management
expects that the Company will receive  payments from Zoro Mining Corp.
(“Zoro”) pursuant to an existing receivable (which has been reduced by a reserve
for doubtful accounts - See Note 12 to the financial statements contained in
this report).  Zoro owes the Company gross $222,000 as of January 31,
2009 (net receivable $25,000 after adjusting a reserve for doubtful account for
$197,000 created as a matter of caution due to current unfavorable and
challenging general economic conditions) and has subsequent to the quarter
repaid $25,000.  Management believes that these funds will help to
alleviate short term cash deficiencies.  Management also anticipates
that additional advances or other financing arrangements, similar to those
provided in the past, will be arranged through a Director of the Company.
Such historical financings have generally taken the form of unsecured bank loans
or lines of credit, cash advances, advances under promissory notes, and
investments in Company securities or advances under convertible notes. The
Company has  also received advances from War Eagle Mining Company, Inc
(“War Eagle”)  pursuant to a secured promissory note granted on
February 17, 2009 (the “War Eagle Note”).  War Eagle has notified the
Company that it will not honor further funding advances under the War Eagle
Note.  The Company has notified War Eagle that it considers War Eagle
to have breached its obligations under the War Eagle Note.   See
Note 17 of the Company’s financial statements included with this report for a
further description of the War Eagle Note.
 
 Due to
current difficult economic conditions and increased competition among small
mineral exploration stage companies for available sources of capital, it has
become more difficult to raise financing than in the previous operating years of
the Company.  The continued depletion of current cash and cash
equivalents to meet ongoing administrative expenses and other continuing
obligations is a material concern of management.  The continued
operation of the Company is dependent on raising additional financing to meet
commitments and obligations and there can be no assurance that such financing
can be obtained on a timely basis or on favorable terms or at all.  If
we fail to obtain financing, the Company may be forced to cease doing
business.
  - 25
-
 
 SELECTED QUARTER
INFORMATION
 
 January 31, 2009
                            
                            
                            January 31, 2008Revenues
                            
                            $
                            Nil
                            
                            
                            $
                            NilNet
      Loss
                            
                            $
                            890,949
                            
                            
                            $
                            6,995,469Loss
      per share-basic and diluted
                            
                            $
                            (0.02
                            )
                            
                            $
                            (0.21
                            )Total
      Assets
                            
                            $
                            200,168
                            
                            
                            $
                            544,385Total
      Liabilities
                            
                            $
                            1,304,972
                            
                            
                            $
                            182,540Cash
      dividends declared per share
                            
                            Nil
                            
                            
                            Nil
 
 Total
assets for the quarter ended January 31, 2009 include cash and cash equivalents
for $17,961, prepaid expenses for $16,453, advances to a related party for
$25,000, capital assets for $140,154 and mining claims for $600. For the quarter
ended January 31, 2008,  total assets includes cash and cash
equivalents of $389,229, prepaid expenses of $55,347 capital assets of $99,209
and mineral claims for $600.
 
 Revenues
 
 No
revenue was generated by the Company’s operations during the three month period
ended January 31, 2009 and January 31, 2008.
 
 Net
Loss
  The
Company’s expenses are reflected in the Statements of Operation under the
category of Expenses.  The Company is an exploration stage mining
company and has not yet realized any revenue from its operations.  The
Company is primarily engaged in the acquisition and exploration of mining
properties.  Mineral property exploration costs are expensed as
incurred.  Mineral property payments are capitalized only if the
Company is able to allocate any economic value beyond proven and probable
reserves.  When it has been determined that a mineral property can be
economically developed as a result of establishing proven and probable reserves,
the costs incurred to develop such property will be capitalized.  For
the purpose of preparing financial information, the Company is unable to
allocate any economic value beyond proven and probable reserves and hence all
property payments are considered to be impaired and accordingly written off to
project expense.  All costs associated with a property that has the
potential to add to the Company’s proven and probable reserves are expensed
until a final feasibility study demonstrating the existence of proven and
probable reserves is completed.  No costs have been capitalized in the
periods covered by these financial statements.  Once capitalized, such
costs will be amortized using the units-of-production method over the estimated
life of the probable reserve.  Mineral property acquisition costs will
also be capitalized in accordance with the FASB Emerging Issues Task Force
("EITF") Issue 04-2 when management has determined that probable future benefits
consisting of a contribution to future cash inflows have been identified and
that adequate financial resources are available or are expected to be available
as required to meet the terms of property acquisition and budgeted exploration
and development expenditures.  Mineral property payments are expensed
as incurred if the criteria for capitalization is not met.
  To date,
mineral property exploration costs have been expensed as incurred.  As
of the date of these financial statements, the Company has incurred only
property payments and exploration costs which have been expensed.  To
date the Company has not established any proven or probable reserves on its
mineral properties.
  - 26
-
 
 The
significant components of expense that have contributed to the total operating
expense are discussed as follows:
 
 (a) General and Administrative
Expense
 
 Included
in operating expenses for the three month period ended January 31, 2009 is
general and administrative expense of $342,543, as compared with $760,388 for
the three month period ended January 31, 2008.  General and
administrative expense represents approximately 40.32% of the total operating
expense for the quarter ended January 31, 2009. This expense for the quarter
ended January 31, 2009 includes professional, consulting, office and general and
non cash compensation expense relating to the issue of options and warrants for
$91,641 (prior period: $199,958)and non cash expense relating to the
amortization of deferred stock compensation relating to issue of stock to
consultants for $62,500 (prior period $262,500).
 
 (b) Project
Expense
 
 Included
in operating expenses for the three month period ended January 31, 2009 is
project expenses of $491,563 as compared with $706,663 for the three month
period ended January 31, 2008.  Project expense represents
approximately 57.87 % of the total operating expense for the three month period
ended January 31, 2009. This expense includes consulting, claims, equipment
rentals, contract labor, field wages, photography and other project related
expenses incurred during the quarter on the mineral claims in
Chile.
 
 (c)Mineral
claims acquisition cost expense
 
 (1)           On
December 17, 2007, Pacific Copper acquired Pacific Copper Peru SRL, a limited
liability partnership organized under the laws of Peru (“Peru SRL”) pursuant to
the Share Exchange Agreement among the Company, Peru SRL and the former partners
of Peru SRL dated as of April 11, 2007, as amended (the “Peru
Agreement”).  Pursuant to the Peru Agreement, the Company issued
4,850,000 shares of the Company’s common stock (the “Peru Consideration Shares”)
to the partners of Peru SRL as consideration for the acquisition of 99% of Peru
SRL.  The 1% minority interest was credited with
$24,495.  As a result of the acquisition, Peru SRL became a subsidiary
of the Company. The Company expensed $2,449,295, relating to the issue of
4,850,000 common shares calculated at $0.50 per common share and the allocation
of minority interest for $24,495 net of capitalization for $200 for mineral
property claims.  Property acquisition costs relating to the exploration
properties are being expensed until the economic viability of the project is
determined and proven and probable reserves quantified.  In the absence of
proven and probable reserves, the Company is unable to allocate any economic
values to the claims.  The Company does not consider either of the mineral
claims acquired in this transaction (as listed below) to be material assets
at this time, but our assessment may change after further work is done on the
properties.  Pursuant to this acquisition the Company acquired interest in
the following mineral claims which were capitalized at $100 each:
 
 Tonalia
(subject to the completion of the formal documentation)
 Don
Javier (subject to the completion of formal documentation)
 
 (2)           On
January 8, 2008, Pacific Copper acquired Sociedad Pacific Copper Chile Limitada,
a limited liability partnership organized under the laws of Chile (“Pacific
LTDA”) pursuant to a Share Exchange Agreement entered into as of April 11, 2007
(the “Chile Agreement”), as amended, between the Company and the former partners
of Pacific LTDA.  Pursuant to the Chile Agreement the Company issued
6,088,452 of its common shares (the “Chile Consideration Shares”) to the former
partners of Pacific LTDA as consideration for the acquisition of 99% of Pacific
LTDA.  The 1% minority interest was credited with
$30,750.  As a result of the acquisition, Pacific LTDA became a
subsidiary of the Company.  The Company expensed $3,074,576, relating
to the issue of 6,088,452 common shares calculated at $0.50 per common share and
the allocation of minority interest for $30,750 net of capitalization for $400
for mineral property claims.  Property acquisition costs relating to
the exploration properties are being expensed until the economic viability of
the project is determined and proven and probable reserves quantified.  In
the absence of proven and probable reserves, the Company is unable to allocate
any economic values to the claims.  The Company does not consider any
of the mineral claims acquired in the transaction (as listed below) to be
material assets at this time, but our assessment may change after further work
is done on the properties.  Pursuant to this acquisition the Company
acquired interest in the following mineral claims which were capitalized at $100
each:
  - 27
-
  Carrera
Pinto
 Carrizal
 Cerro
Blanco
 La
Guanaca
  Liquidity
and Capital Resources
 
 The
following table summarizes the company’s cash flows and cash in hand as of
January 31, 2009:
 
 January 31, 2009Cash
      and cash equivalent
                        
                        $
                        17,961Working
      capital (deficit)
                        
                        $
                        (1,207,948
                        )Cash
      used in operating activities
                        
                        $
                        (194,283
                        )Cash
      used in investing activities
                        
                        $
                        nilCash
      provided by financing activities
                        
                        $
                        100,000
 
 As at
January 31, 2009, the Company had a working capital deficit of
$1,207,948.  During the three-month period ended January 31, 2009, the
Company did not spend any funds on investment activity.  The Plant and
Equipment as on January 31, 2009 is $140,154.
  - 28
-
  Critical
Accounting Policies
 
 The
preparation of financial statements in accordance with accounting principles
generally accepted in the United States requires us to make estimates and
assumptions that affect reported amounts of assets and liabilities at the date
of the financial statements, the reported amount of revenues and expenses during
the reporting period and related disclosure of contingent assets and
liabilities.  On an ongoing basis, we evaluate our estimates and
judgments.  To the extent actual results differ from those estimates,
our future results of operations may be affected.  Beside this
critical accounting policy on use of estimates, we believe the following
critical accounting policy affects the preparation of our financial
statements.
 
 Acquisition, Exploration and
Evaluation Expenditures
  The
Company is an exploration stage mining company and has not yet realized any
revenue from its operations.  It is primarily engaged in the
acquisition and exploration of mining properties.  Mineral property
exploration costs are expensed as incurred.  Mineral property payments
are capitalized only if the Company is able to allocate any economic value
beyond proven and probable reserves.  When it has been determined that
a mineral property can be economically developed as a result of establishing
proven and probable reserves, the costs incurred to develop such property will
be capitalized.  For the purpose of preparing financial information,
the Company is unable to allocate any economic value beyond proven and probable
reserves and hence all property payments are considered to be impaired and
accordingly written off to project expense.  All costs associated with
a property that has the potential to add to the Company’s proven and probable
reserves are expensed until a final feasibility study demonstrating the
existence of proven and probable reserves is completed.  No costs have
been capitalized in the periods covered by these financial
statements.  Once capitalized, such costs will be amortized using the
units-of-production method over the estimated life of the probable
reserve.  Mineral property acquisition costs will also be capitalized
in accordance with the FASB Emerging Issues Task Force ("EITF") Issue 04-2 when
management has determined that probable future benefits consisting of a
contribution to future cash inflows have been identified and that adequate
financial resources are available or are expected to be available as required to
meet the terms of property acquisition and budgeted exploration and development
expenditures.  Mineral property payments are expensed as incurred if
the criteria for capitalization is not met.
  To date,
mineral property exploration costs have been expensed as incurred.  As
of the date of these financial statements, the Company has incurred only
property payments and exploration costs which have been expensed.  To
date the Company has not established any proven or probable reserves on its
mineral properties.
 
 Off-Balance
Sheet Arrangement
 
 The
Company had no off- balance sheet arrangements as of January 31, 2009 and
January 31, 2008.
 
 Contractual
Obligations and Commercial Commitments
 
 On June
1, 2007, the Company entered into an agreement with Sweetwater Capital
Corporation, a private company with a director in common with the Company
(“Sweetwater”) for a term of 24 months to provide financial public relations,
business promotion, business growth and development consulting services,
including consultation regarding mergers and acquisitions, and general business
consultation.  The Company will pay Sweetwater $4,000 per month plus
1,000,000 restricted shares of the Company's common stock that will be earned in
equal installments of 250,000 shares on December 1, 2007, March 1, 2008, June 1,
2008 and September 1, 2008.  The said 1,000,000 shares of restricted
Common stock of the Company were tendered in one certificate on June 1,
2007.  The consultant must return any unearned shares upon early
termination of the agreement.  Either the consultant or the Company
may terminate the agreement with or without cause upon sixty (60) days written
notice to the other provided that the Company may not give notice of
cancellation before January 1, 2007.
 
 On April
19, 2007, the Company executed an agreement dated as of April 11, 2007 with
David Hackman, a director of the Company, on behalf of a corporation to be
formed in Peru which, prior to closing, would then own certain mineral claims
located in Peru.  On December 17, 2007, Pacific Copper completed the
acquisition of Peru SRL, pursuant to the Share Exchange Agreement among the
Company, Peru SRL and the former partners of Peru SRL dated as of April 11,
2007. The 4,850,000 shares of the Company’s common stock issued in connection
with the closing of this transaction are held in escrow subject to the
satisfaction of certain post-closing conditions.
  - 29
-
 
 On April
19, 2007 the Company executed an agreement dated as of April 11, 2007 with
Harold Gardner, a director of the Company, on behalf of a corporation to be
formed in Chile which, prior to closing, would then own certain mineral claims
located in Chile.  On January 8, 2008, Pacific Copper acquired Pacific
LTDA pursuant to a Share Exchange Agreement entered into as of April 11, 2007
between the Company and the former partners of Pacific LTDA.  The
6,088,452 shares of the Company’s common stock issued in connection with the
closing of this transaction are held in escrow subject to the satisfaction of
certain post-closing conditions.
 
 On August
9, 2007 the Company and Andrew A. Brodkey executed an employment agreement
pursuant to which the Company retained Mr. Brodkey as President and Chief
Executive Officer.  The Employment Agreement has a two-year term that
commenced on August 1, 2007 and will continue until August 1, 2009 unless
terminated earlier pursuant to the terms of the Employment
Agreement.  Mr. Brodkey’s base salary is $132,000 per
year.  Upon certain events of termination Mr. Brodkey would be
entitled to a maximum of one year’s salary as a severance
payment.  Under the employment agreement, Mr. Brodkey is permitted to
pursue other business opportunities.
 
 On August
14, 2008, the Company entered into a consulting services agreement with Yellow
Rose Ltd., to provide business and financial consulting relating to the European
markets.  The term of this agreement is for a period of 12 months.
Consulting fee of up to $20,000 is billable from the consultant during the term
of this agreement.
 
 On August
22, 2007 the Company entered into an agreement with Kriyah for the performance
of certain administrative and management services.   The
Kriyah Agreement has an initial term of two years and is then automatically
renewable.  Either party may terminate the Kriyah Agreement upon 60 days
prior written notice.  Under the Kriyah Agreement, Kriyah received an
initial payment of $57,504 and will receive payments of $4000 each month
thereafter.  Commencing in January of 2009, this amount was reduced to
$2500 per month.  In order to facilitate the retaining of Kriyah, the
Company guaranteed a lease agreement for the office space used by Kriyah in
Tucson, Arizona.  The Company’s maximum obligation under the lease
guarantee, as of January 31, 2009, would be $246,608.52 in the event of a lease
default with full acceleration of rent.  Kriyah’s Manager, Andrew A.
Brodkey, is also the President and CEO of the Company.
 
 On
September 1, 2007, the Company entered into a Payroll Service Agreement with
Kriyah to administer payroll and health insurance benefits to Andrew A. Brodkey,
President and CEO of the Company, as contemplated in his Employment Agreement
with the Company dated August 1, 2007 (“Employment Agreement”).  The
Company shall reimburse Kriyah monthly for all direct costs for wages, covered
by the Employment Agreement and health benefits provided by Kriyah and invoiced
to the Company for Mr. Brodkey.
 
 On August
16, 2007, the Company entered into an agreement with Hydro Geophysics Inc.
(“HGI”).  Pursuant to this agreement, HGI provided certain mineral
exploration, analytical and consulting services to the Company, as requested
from time to time, with respect t the Company’s South American
projects.  This contract expired on February 16, 2009.  The
Company remains obligated for the payment of an aggregate of $89,212 of unpaid
invoices under this contract.
 
 On
January 24, 2008, the Company, through its subsidiary Pacific LTDA entered into
an exclusive exploration, mining and exploitation agreement (the "Guanaca
Lease") for the La Guanaca oxide copper project located northeast of the town of
Inca de Oro, Chanaral Province, Atacama Region 3, Chile.  This
property, which consists of approximately 300 hectares of exploration
concessions, is road-accessible and was previously explored in the mid-1990's
through geophysical methods, sampling and drilling by Empresa Nacional de
Mineria ("ENAMI") a Chilean nationally-owned mining enterprise.  The
Guanaca Lease is for a term of 5 years and is renewable automatically for
additional 5-year periods.  The owners of the La Guanaca property will
receive US$2,000 per month in cash during the term of the
agreement.
 
 - 30
-
  On
February 12, 2008, the Company’s subsidiary, Pacific LTDA, entered into an
Operator Agreement (the “Chile Operator Agreement”) with Gareste Limitada, a
limited liability partnership organized under the laws of Chile
(“Gareste”).  Pursuant to the Chile Operator Agreement Gareste will
prepare and submit proposed annual work programs and accompanying budgets to
Pacific LTDA covering the exploration and, if warranted, development of certain
mineral concessions held by Pacific LTDA.  Gareste will provide
comprehensive management services and contract for  transportation,
labor, insurance and logistical services for all approved
programs.  Gareste’s overhead reimbursement and compensation will be
specified in each proposed budget and subject to approval by Pacific
LTDA.  The Chile Operator Agreement is terminable by either party upon
90-days’ prior notice.  Harold Gardner, a member of the Company’s
board of directors, is a partner in Gareste.
 
 On
February 12, 2008 The Company’s subsidiary, Peru SRL entered into an Operator
Agreement (the “Peru Operator Agreement”) with Inversiones Mineras Stiles, a
limited liability partnership organized under the laws of Peru
(“Stiles”).  Pursuant to the Peru Operator Agreement Stiles will
prepare and submit proposed annual work programs and accompanying budgets to
Peru SRL covering the exploration and, if warranted, development of certain
mineral concessions held by Peru SRL.  Stiles will provide
comprehensive management services and contract for transportation, labor,
insurance and logistical services for all approved programs.  Stiles’
overhead reimbursement and compensation will be specified in each proposed
budget and subject to approval by Peru SRL.
 
 On
February 28, 2008 the Company entered into an agreement with Michael A. McClave
(“McClave”).  Pursuant to this agreement, McClave will provide certain
mineral exploration, geological and consulting services to the Company, as
requested from time to time.  Pacific Copper will be invoiced on a
monthly basis for services rendered on the projects.  Either party may
terminate this agreement by giving 30 days notice with or without
cause.
 
 On May
15, 2008, the Company entered into a consulting and professional services
agreement with Jehcorp Inc. (“Consultant”).  Pursuant to this
agreement, Consultant agrees to provide and perform for the benefit of the
Company certain expert technical consulting services, specifically including,
but not limited to, the preparation of a Canadian National Instrument NI-43-101
Technical Report for various properties owned or controlled by the Company and
its subsidiaries in Peru and Chile.  The Company will be invoiced on a
monthly basis for services rendered and the Consultant was advanced
$5,000.
 
 The
Company, through Pacific LTDA, also executed a letter of intent with
Gareste acquire its interest in the “Yerbas Buenas” oxide copper property
located 130 km southeast of the city of Copiapo, Atacama Region III,
Chile.  Yerbas Buenas is located roughly 20 km from the El Corral
property.  Gareste will receive 2 million shares of the Company at
closing in exchange for its interest at Yerbas Buenas, and a 2% NSR royalty,
capped at $6 million, 1% of which can be repurchased for the sum of $2 million
at any time prior to commercial production.  As of the date of this
report, the Company and Gareste have postponed performance under this letter of
intent due to the current copper market conditions and general economic decline
worldwide.
 
 On June
10, 2008 the Company executed an agreement with Eagle Mapping Ltd. for providing
services for a total consideration payable for $52,200.
 
 On
October 28, 2008, the Company received a cease trade order (the “CTO”) from the
British Columbia Securities Commission (the “BCSC”), the effect of which is
limited to the Province of British Columbia. By its terms, the CTO was issued
for not filing a technical report under Canadian National Instrument 43-101
Standards of Disclosure for
Mineral Projects(“NI 43-101”) with respect to its material copper oxide
projects in Chile after having made public disclosures regarding such
properties.  The Company has engaged counsel in British Columbia and
is in the process of obtaining and filing the reports and information required
by the BCSC and otherwise satisfying the requirements of British Columbia
law.  As of the date of this report, this matter has not been resolved
and the CTO is in effect. The financial impact of the CTO is
unknown.
  - 31
-
 
 Subsequent
Events
 
 Subsequent
to the quarter ended January 31, 2009, a related party repaid an amount of
$25,000 (refer to note 12 to the financial statements).
 
 Subsequent
to the quarter ended January 31, 2009, on February 17, 2009, Pacific Copper
issued a secured promissory note (the “War Eagle Note”) to War Eagle Mining
Company, Inc. a Canadian corporation (“War Eagle”).  War Eagle and the
Company share a common director.  The War Eagle Note has a face amount
of $155,000 which includes amounts previously advanced to the
Company.  Pursuant to the War Eagle Note, War Eagle agreed to make
advances of credit to Kriyah for the benefit of Pacific
Copper.  Kriyah performs administrative services for Pacific Copper
and also shares office space with War Eagle and Pacific Copper.  Upon
execution of the War Eagle Note, an initial advance of $15,000 was made to
Kriyah for the benefit of the Company, with subsequent  advances of
$15,000 to be made on the 1st day of
the months of February, March, April, and May of 2009, and a final payment of
$10,000 to be made on or before June 1, 2009.  Under the terms of the
War Eagle Note, all amounts advanced are due and payable on June 30, 2009 with
interest at 15% per annum.  The War Eagle Note covers a prior advance
of $70,000 that was received by Pacific Copper on June 22, 2008.  The
principal amount outstanding under the War Eagle Note (beginning with the
initial advance on June 22, 2008) bears interest at 15% per
annum.  The War Eagle Note is secured by a blanket security interest
in all real, personnel, and intangible interests of Pacific Copper associated
with each of the La Guanaca, El Corral, La Mofralla and Venado projects (the
Company’s South American oxide copper properties, as described in this
report).  While War Eagle funded $30,000 on February 17, 2009 pursuant
to the War Eagle Note (bringing the outstanding principal amount to $100,000),
War Eagle has notified the Company that it will not fund the March, April or May
advances or the $10,000 final advance contemplated in the War Eagle Note,
leaving a funding shortfall of $55,000.  The Company has notified War
Eagle that it considers this failure to fully fund the War Eagle Note to be a
breach and has reserved all of its legal rights.
 
 Subsequent
to the quarter ended January 31, 2009, as of February 27, 2009, Pacific Copper,
through its wholly owned subsidiary Pacific LTDA, entered into a definitive
mineral property acquisition agreement (the “Gareste Agreement”) with Gareste
pursuant to which the Company acquired a 100% interest in the following copper
oxide properties located in Atacama Region II, Chile: the “Venado Property”
(also known as the “Venapai Property”) consisting of approximately 3600 hectares
of exploration concessions, located roughly 45 kilometers from the city of
Copiapo, the “El Corral Property”, consisting of approximately 4000 hectares of
exploration concessions, located roughly 60 kilometers from the city of Copiapo,
and the adjacent “La Mofralla Property”, consisting of approximately 250
hectares of exploration concessions also located roughly 60 kilometers from the
City of Copiapo.  These properties were subject to separate letters of
intent entered into during July and October of 2008, as previously
disclosed.
 
 Under the
Gareste Agreement the Company is required to issue a total of 5,000,000 shares
of its common stock to Gareste, allocable as follows: 2,000,000 shares of common
stock as consideration for the Venado Property, 2,000,000 shares of common stock
as consideration for the El Corral Property and 1,000,000 shares of common stock
as consideration for the La Mofralla Property.  In addition, the
Venado Property is subject to a 2% net smelter return royalty, capped at
$10,000,000, 50% of which can be repurchased by Pacific Copper at any time prior
to the commencement of production for $3,000,000, and the El Corral Property is
subject to a 2% net smelter return royalty, capped at $10,000,000, 50% of which
can be repurchased by Pacific Copper at any time prior to the commencement of
production for $2,000,000.  As of the date of this report, title to
the properties has been transferred to Pacific LTDA and the closing is in
process.
  RISK
FACTORS
  1.           
WE DO NOT HAVE ADEQUATE CASH ON HAND TO MEET CURRENT OBLIGATIONS
  As of the
date of the filing of this report, the Company has very little
cash.  As of the quarter ended January 31, 2009, the Company’s current
liabilities were $1,267,362 while current assets
were  $59,414.  Management has taken steps to reduce
operating costs.  As a result of current general economic conditions,
the Company’s ability to attract investment and/or obtain financing is extremely
limited.  If we fail to obtain financing, the Company will be forced
to cease doing business.
  - 32
-
 
 2.
              SUBSTANTIAL
      PORTIONS OF OUR SOUTH AMERICAN COPPER OXIDE EXPLORATION PROPERTY ASSETS
      HAVE BEEN PLEDGED TO SECURE A SHORT-TERM
NOTE
 
 Subsequent
to the quarter ended January 31, 2009, on February 17, 2009, Pacific Copper
issued a secured promissory note (the “War Eagle Note”) to War Eagle Mining
Company, Inc. a Canadian corporation (“War Eagle”).  The War Eagle
Note has a face amount of $155,000.  All amounts advanced under the
War Eagle Note are due and payable on June 30, 2009 with interest at 15% per
annum.  By its terms, the War Eagle Note is secured by a blanket
security interest in all real, personnel, and intangible interests of the
Company associated with each of the La Guanaca, El Corral, La Mofralla and
Venado projects (the Company’s South American oxide copper properties, as
described herein).  The Company has declared a breach by War Eagle
under the War Eagle Note for failure by War Eagle to fully fund advances under
the War Eagle Note.  While the Company believes it has a strong legal
position with respect to the dispute with War Eagle, it is possible that if the
Company does not repay the War Eagle Note on June 30, 2009 (the maturity date),
it could lose its interest in the properties securing the War Eagle
Note.
 
 3.
              THE
      COMPANY HAS NO SOURCE OF OPERATING REVENUE AND EXPECTS TO INCUR
      SIGNIFICANT EXPENSES BEFORE ESTABLISHING AN OPERATING COMPANY, IF IT IS
      ABLE TO ESTABLISH AN OPERATING COMPANY AT
ALL.
 
 Currently,
the Company has no source of revenue, and no commitments to obtain additional
financing.  The Company will require significant additional working
capital to carry out its exploration programs.  The Company has no
operating history upon which an evaluation of its future success or failure can
be made.  The ability to achieve and maintain profitability and
positive cash flow is dependent upon:
 
 §     further
exploration of our properties and the results of that exploration;
 
 §     raising
the capital necessary to conduct this exploration; and
 
 §     raising
capital to develop our properties.
 
 Because
the Company has no operating revenue, it expects to incur operating losses in
future periods as it continues to spend funds to explore its
properties.  Failure to raise the necessary capital to continue
exploration could cause the Company to go out of business.
 
 4.
              BECAUSE
      OF THE UNIQUE DIFFICULTIES AND UNCERTAINTIES INHERENT IN MINERAL
      EXPLORATION VENTURES AND CURRENT DETERIORATION IN EQUITY MARKETS, WE FACE
      A HIGH RISK OF BUSINESS FAILURE.
 
 Investors
should be aware of the difficulties normally encountered by new mineral
exploration companies and the high rate of failure of such
enterprises.  Our prospects are further complicated by a pronounced
deterioration in equity markets and constriction in equity capital available to
finance and maintain our exploration activities.  Our likelihood of
success must be considered in light of the problems, expenses, difficulties,
complications and delays encountered in connection with the exploration of the
mineral properties that we plan to undertake and the difficult economy and
market volatility that we are experiencing.  Moreover, most
exploration projects do not result in the discovery of commercially mineable
deposits.
 
 5.
              THE
      COMPANY IS HIGHLY DEPENDENT UPON ITS OFFICERS AND
      DIRECTORS.  BECAUSE OF THEIR INVOLVEMENT IN OTHER SIMILAR
      BUSINESSES WHICH MAY BE COMPETITORS, THEY MAY HAVE A CONFLICT OF
      INTEREST.
  - 33
-
 
 None of
the Company’s officers or directors works for the Company on a full-time
basis.  The Company’s President and Chief Executive Officer, Andrew
Brodkey, is also the president of one other exploration stage mining company
and, by the terms of his employment agreement with the Company, is permitted to
participate in other mining related businesses.  Some of our directors
are officers or directors of other companies in similar exploration
businesses.  Such business activities may be considered a conflict of
interest because these individuals must continually make decisions on how much
of their time they will allocate to the Company as against their other business
projects, which may be competitive.  Also, the Company has no key man
life insurance policy on any of its senior management or
directors.  The loss of one or more of these officers or directors
could adversely affect the ability of the Company to carry on
business.
 
 6.          
 THE COMPANY COULD ENCOUNTER REGULATORY AND PERMITTING DELAYS.
 
 The
Company could face further delays in obtaining title to properties under
contract with its subsidiary in Peru, as well as delays in obtaining permits to
explore on the properties covered by our claims.  Such delays could
jeopardize financing, if any is available, which could result in having to delay
or abandon work on some or all of the properties.
 
 7.           
RISKS ASSOCIATED WITH PROPERTIES IN SOUTH AMERICA
 
 The
Company is currently pursuing investments and exploration projects in Chile and
Peru. These investments and projects, as well as any other investments or
projects made or undertaken in the future in other developing nations, are
subject to the risks normally associated with conducting business in such
countries, including labor disputes and uncertain political and economic
environments, as well as risks of disturbances or other risks which may limit or
disrupt the projects, restrict the movement of funds or result in the
deprivation of contract rights or the taking of property by nationalization or
expropriation without fair compensation laws or policies, foreign taxation,
limitations on ownership and on repatriation of earnings, and foreign exchange
controls and currency fluctuations.  Foreign investments may also be
adversely affected by changes in United States laws and regulations relating to
foreign trade, investment and taxation.  If the Company’s operations
in a particular foreign country were halted, delayed or interfered with, the
Company’s business could be adversely affected.
 
 8.
              OUR
      PLANNED MINERAL EXPLORATION EFFORTS ARE HIGHLY SPECULATIVE; WE HAVE NOT
      YET ESTABLISHED ANY PROVEN OR PROBABLE
RESERVES.
 
 Mineral
exploration is highly speculative.  It involves many risks and is
often nonproductive.  Even if we believe we have found a valuable
mineral deposit, it may be several years before production is possible. During
that time, it may become no longer feasible to produce those minerals for
economic, regulatory, political, or other reasons.  Additionally, we
may be required to  make substantial capital expenditures and to
construct mining and processing facilities.  As a result of these
costs and uncertainties, we may be unable to start, or if started, to finish our
exploration activities.  In addition, we have not to date established
any proven or probable reserves on our mining properties and there can be no
assurance that such reserves will ever be established.
 
 9.
              MINING
      OPERATIONS  IN GENERAL INVOLVE  A HIGH DEGREE OF RISK,
      WHICH WE MAY BE UNABLE, OR MAY NOT CHOOSE  TO INSURE
      AGAINST.
 
 Our
operations are subject to all of the hazards and risks normally encountered in
the exploration, development and production of minerals.  These
include unusual and unexpected geological  formations, rock falls,
flooding and other conditions  involved in the drilling and removal of
material, any of which could result in damage to, or destruction of, mines and
other producing facilities, damage to life or property, environmental damage and
possible legal liability.  Although we plan to take adequate
precautions to minimize these risks, and risks associated  with
equipment failure or failure of retaining dams which may result
in  environmental  pollution, there can be no assurance that
even with our precautions, damage or loss will not occur and that we will not be
subject to liability which will have a material adverse effect on our business,
results of operation and financial condition.
  - 34
-
 
 10.
              BECAUSE
      OF THE INHERENT DANGERS INVOLVED IN MINERAL EXPLORATION, THERE IS A RISK
      THAT WE MAY INCUR LIABILITY OR DAMAGES AS WE CONDUCT OUR
      BUSINESS.
 
 The
search for valuable minerals involves numerous hazards.  As a result,
we may become subject to liability for such hazards, including pollution,
cave-ins and other hazards against which we cannot insure or against which we
may elect not to insure.  At the present time, we may not have
sufficient coverage to insure against these hazards.  Incurring such
liabilities could result in our going out of business.
  11.           GOING
CONCERN QUALIFICATION
  The
Company has included a “going concern” qualification in the Consolidated
Financial Statements to the effect that we are an exploration stage company and
have no established sources of revenue. In the event that we are unable to raise
additional capital and/or locate mineral resources, as to which in each case
there can be no assurance, we may not be able to continue our
operations.  In addition, the existence of the “going concern”
qualification in our auditor's report may make it more difficult for us to
obtain additional financing.  If we are unable to obtain additional
financing, you may lose all or part of your investment.
  12.           OUR
BUSINESS IS AFFECTED BY CHANGES IN COMMODITY PRICES.
 
 Our
ability to develop our mineral properties and the future profitability of the
Company is directly related to the market price of certain
minerals.  The Company is negatively affected by the current decline
in commodity prices.
 
 13.           OUR
COMMON STOCK IS A PENNY STOCK.
 
 Our
Common Stock is classified as a penny Stock, which is traded on the OTC Bulletin
Board.  As a result, an investor may find it more difficult to dispose
of or obtain accurate quotations as to the price of the shares of the Common
Stock.  In addition, the “penny stock” rules adopted by the Securities
and Exchange Commission subject the sale of the shares of the Common Stock to
certain regulations which impose sales practice requirements on
broker-dealers.  For example, broker-dealers selling such securities
must, prior to effecting the transaction, provide their customers with a
document that discloses the risks of investing in such
securities.  Furthermore, if the person purchasing the securities is
someone other than an accredited investor or an established customer of the
broker-dealer, the broker-dealer must also approve the potential customer’s
account by obtaining information concerning the customer’s financial situation,
investment experience and investment objectives.  The broker-dealer
must also make a determination whether the transaction is suitable for the
customer and whether the customer has sufficient knowledge and experience in
financial matters to be reasonably expected to be capable of evaluating the risk
of transactions in such securities.  Accordingly, the Commission’s
rules may result in the limitation of the number of potential purchasers of the
shares of the Common Stock.  In addition, the additional burdens
imposed upon broker-dealers by such requirements may discourage broker-dealers
from effecting transactions in the Common Stock, which could severely limit the
market of the Company’s Common Stock.
 
  - 35
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  DISCLOSURE
AND FINANCIAL CONTROLS AND PROCEDURES
  Based on
an evaluation our Chief Executive Officer and Chief Financial Officer conducted,
of the effectiveness of the design and operation of our disclosure controls and
procedures, as required by Exchange Act Rule 13a-15(e) they concluded that our
disclosure controls and procedures were effective as of January 31, 2009, to
ensure that information required to be disclosed by us in the reports that we
file or submit under the Exchange Act are:
  1.
              recorded,
      processed, summarized and reported within the time periods specified by
      the SEC's rules and forms, and
  2.
              accumulated
      and communicated to management, including the Chief Executive Officer and
      Chief Financial Officer, as appropriate to allow timely decisions
      regarding required disclosure.
  Management
of Pacific Copper is responsible for establishing and maintaining adequate
internal control over financial reporting.  Internal control over
financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under
the Securities Exchange Act of 1934 as a process designed by, or under the
supervision of, the company's principal executive and principal financial
officers and effected by the Company's board of directors, management and other
personnel, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with accounting principles generally accepted in the
United States and includes those policies and procedures that:
  (a)  Pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of the assets of the
company;
  (b)  Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with accounting principles
generally accepted in the United States and that receipts and expenditures of
the company are being made only in accordance with authorizations of management
and directors of the company; and
  (c)  Provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the company's assets that could have a
material effect on the financial statements.
  Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements.  Even those systems determined to be
effective can provide only reasonable assurance with respect to financial
statement preparation and presentation.  Because of the inherent
limitations of internal control, there is a risk that material misstatements may
not be prevented or detected on a timely basis by internal control over
financial reporting.  However, these inherent limitations are known
features of the financial reporting process.  Therefore, it is
possible to design into the process safeguards to reduce this risk.
  In making
this assessment, management, used the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission in Internal
Control-Integrated Framework.
  Inherent
in small business is the pervasive problem of segregation of
duties.  Given that the Company has a small accounting department,
segregation of duties cannot be completely accomplished at this stage in the
corporate lifecycle.  Management has added many compensating controls
to effectively reduce and minimize the risk of a material misstatement in the
Company’s financial statements.
  Based on
its assessment, management has concluded that the Company's disclosure controls
and procedures and internal control over financial reporting is effective based
on those criteria.
  During
the quarter ended January 31, 2009, there have been no changes to the Company’s
internal controls over financial reporting that have materially affected, or are
reasonably likely to materially affect, the Company’s internal control over
financial reporting.
  - 36
-
 
 PART
II: OTHER INFORMATION
 
 ITEM
1: LEGAL PROCEEDINGS:
 
 The
Company is not a party to any pending legal proceeding or litigation and none of
the Company’s property is the subject of a pending legal
proceeding.
 
 On
October 28, 2008, the Company received a cease trade order (the “CTO”) from the
British Columbia Securities Commission (the “BCSC”), the effect of which is
limited to the Province of British Columbia. By its terms, the CTO was issued
for not filing a technical report under Canadian National Instrument 43-101
Standards of Disclosure for
Mineral Projects(“NI 43-101”) with respect to its material copper oxide
projects in Chile after having made public disclosures regarding such
properties.  The Company has engaged counsel in British Columbia and
is in the process of obtaining and filing the reports and information required
by the BCSC and otherwise satisfying the requirements of British Columbia
law.  As of the date of this report, this matter has not been resolved
and the CTO is in effect.
 
 ITEM
2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS:
 
 None
 
 ITEM
3: DEFAULTS UPON SENIOR SECURITIES:
 
 None.
 
 ITEM
4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
 
 None.
 
 ITEM
5: OTHER INFORMATION:
 
 
 ITEM
6: EXHIBITS & REPORTS ON FORM 8-K
 
 (a)          10.1        Consulting
Agreement with Yellow Rose Ltd. dated August 14, 2008
 
 10.2
              Mineral
      Property Acquisition Agreement dated as of February 27,
    2009
 
 10.3
              Secured
      Promissory Note dated February 17, 2009 payable to War Eagle Mining
      Company, Inc.
 
 (b)    
     31.1        Rule
13a-14(a)/15d-14(a) Certification of Chief
Executive Officer.
 
 31.2
                Rule
      13a-14(a)/15d-14(a) Certification of Chief
      Financial Officer.
 
 32.1
                Certificate
      of Chief Executive Officer and Chief Financial Officer pursuant to 18
      U.S.C. Section 1350, as adopted pursuant to Section 906 of
      the Sarbanes-Oxley Act of
2002.
  (c)         In
addition, the following reports are incorporated by reference:
 
 Current
Report on Form 8-K, “Item 5.02 Departure of Directors or Certain Officers;
Election of Directors; Appointment of Certain Officers, dated November 21,
2008
  - 37
-
 
 SIGNATURE
 
 Pursuant
to the requirements of the Securities and Exchange Act of 1934, the Registrant
has duly caused this Report to be signed on its behalf by the undersigned
thereunto duly authorized.
 
 Dated:  March
      16, 2009
                /s/
                Jodi HendersonSecretary
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