---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549

FORM 10-Q

[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended August 31, 2009

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________________To
______________________

Commission file number000-53447

MASS PETROLEUM
INC.(Exact name of registrant as specified in its
charter)

N/A(Former Name)

|Nevada                                           | 20-5893809                          
|------------------------------------------------ | ------------------------------------
|(State or other jurisdiction of incorporation or | (I.R.S. Employer Identification No.)
|organization)                                    |                                     
|                                                 |                                     
|Suite 507-700 West Pender Street,                |                                     
|Vancouver, British Columbia                      | V6C 1G8                             
|(Address of principal executive offices)         | (Zip Code)                          

604 662 3910(Registrants telephone
number)

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

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated filer. See
definition of accelerated filer and large accelerated filer in Rule 12b-2 of
the Exchange Act. (Check one):

|Large accelerated filer [ ] | Accelerated filer [ ] | Non-accelerated filer [ ] | Smaller reporting company [X]
|--------------------------- | --------------------- | ------------------------- | -----------------------------

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:

Check whether the registrant has filed all documents and reports
required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act
of 1934 subsequent to the distribution of securities under a plan confirmed by a
court. [ ] Yes [ ] No

APPLICABLE ONLY TO CORPORATE ISSUERS:

As of October 19, 2009, the registrants outstanding common
stock consisted of 81,088,000 shares.

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Table of Contents

|PART I  FINANCIAL INFORMATION
|------------------------------
|Item 1.                       
|Item 2.                       
|Item 4T.                      
|                              
|PART II  OTHER INFORMATION   
|Item 1.                       
|Item 2.                       
|Item 4.                       
|Item 5.                       
|Item 6.                       

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PART I  FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

The unaudited financial statements of MASS Petroleum Inc. (the
Company, MASS, we, our, us) follow. All currency references in this
report are in US dollars unless otherwise noted.

MASS Petroleum Inc.

(An Exploration Stage Company)

August 31, 2009

|                                  | Index
|--------------------------------- | -----
|Balance Sheets                    | F-1  
|Statements of Operations          | F-2  
|Statements of Cash Flows          | F-3  
|Notes to the Financial Statements | F-4  

---

|MASS Petroleum Inc.           
|------------------------------
|(An Exploration Stage Company)
|Balance Sheets                
|(Expressed in US dollars)     

|                                                                        |  | August 31,  |   |  | November 30, |  
|----------------------------------------------------------------------- |  | ----------- | - |  | ------------ | -
|                                                                        |  | 2009        |   |  | 2008         |  
|                                                                        |  | $           |   |  | $            |  
|                                                                        |  | (unaudited) |   |  |              |  
|                                                                        |  |             |   |  |              |  
|ASSETS                                                                  |  |             |   |  |              |  
|Current Assets                                                          |  |             |   |  |              |  
|Cash                                                                    |  | 5,293       |   |  | 45,994       |  
|Amounts receivable                                                      |  | 2,744       |   |  | 757          |  
|Prepaid expenses                                                        |  | 917         |   |  | 121,370      |  
|Total Current Assets                                                    |  | 8,954       |   |  | 168,121      |  
|Property and Equipment (Note 3)                                         |  |            |   |  | 565          |  
|Oil and Gas
      Property (Note 4)                                     |  | 12,079      |   |  | 13,052       |  
|Total Assets                                                            |  | 21,033      |   |  | 181,738      |  
|                                                                        |  |             |   |  |              |  
|LIABILITIES AND STOCKHOLDERS DEFICIT                                   |  |             |   |  |              |  
|Current Liabilities                                                     |  |             |   |  |              |  
|Accounts payable                                                        |  | 93,504      |   |  | 80,114       |  
|Accrued liabilities                                                     |  | 2,705       |   |  | 2,655        |  
|Due to related parties (Note 7)                                         |  | 121,467     |   |  | 95,782       |  
|Loans
      payable (Note 6)                                            |  | 82,500      |   |  | 55,000       |  
|Total Liabilities                                                       |  | 300,176     |   |  | 233,551      |  
|Commitments and Contingencies (Notes 1, 9 and 10)                       |  |             |   |  |              |  
|Stockholders Deficit                                                   |  |             |   |  |              |  
|Preferred stock, 20,000,000 shares authorized,
      $0.0001 par value; |  |             |   |  |              |  
|None issued and outstanding                                             |  |            |   |  |             |  
|Common stock, 160,000,000 shares authorized,
      $0.0001 par value;   |  |             |   |  |              |  
|81,088,000 shares issued and
      outstanding (Note 8)                 |  | 8,109       |   |  | 8,109        |  
|Additional paid-in capital                                              |  | 1,664,228   |   |  | 1,377,758    |  
|Donated capital                                                         |  | 33,750      |   |  | 33,750       |  
|Deficit accumulated during the exploration stage                        |  | (1,985,230  | ) |  | (1,471,430   | )
|Total Stockholders Deficit                                             |  | (279,143    | ) |  | (51,813      | )
|Total Liabilities
      and Stockholders Deficit                       |  | 21,033      |   |  | 181,738      |  

(The Accompanying Notes are an Integral Part of These Financial
Statements)

F-1

---

|MASS Petroleum Inc.           
|------------------------------
|(An Exploration Stage Company)
|Statements of Operations      
|(Expressed in US dollars)     
|(unaudited)                   

|                                             |  | Accumulated from    |   |  | For the      |   |  | For the      |   |  | For the     |   |  | For the     |  
|-------------------------------------------- |  | ------------------- | - |  | ------------ | - |  | ------------ | - |  | ----------- | - |  | ----------- | -
|                                             |  | February 14, 2006   |   |  | Three months |   |  | Three months |   |  | Nine months |   |  | Nine months |  
|                                             |  | (Date of Inception) |   |  | Ended        |   |  | Ended        |   |  | Ended       |   |  | Ended       |  
|                                             |  | to August 31,       |   |  | August 31,   |   |  | August 31,   |   |  | August 31,  |   |  | August 31,  |  
|                                             |  | 2009                |   |  | 2009         |   |  | 2008         |   |  | 2009        |   |  | 2008        |  
|                                             |  | $                   |   |  | $            |   |  | $            |   |  | $           |   |  | $           |  
|                                             |  |                     |   |  |              |   |  |              |   |  |             |   |  |             |  
|Revenue                                      |  | 14,958              |   |  | 655          |   |  | 2,216        |   |  | 1,860       |   |  | 5,116       |  
|                                             |  |                     |   |  |              |   |  |              |   |  |             |   |  |             |  
|Expenses                                     |  |                     |   |  |              |   |  |              |   |  |             |   |  |             |  
|Depletion                                    |  | 21,959              |   |  | 343          |   |  | 1,686        |   |  | 973         |   |  | 3,574       |  
|Depreciation                                 |  | 3,391               |   |  |             |   |  | 283          |   |  | 565         |   |  | 848         |  
|General and administrative (Note7)           |  | 1,888,603           |   |  | 116,797      |   |  | 359,059      |   |  | 513,179     |   |  | 561,012     |  
|Oil and gas production                       |  | 9,542               |   |  | 282          |   |  | 379          |   |  | 943         |   |  | 1,222       |  
|Mineral property costs                       |  | 1,693               |   |  |             |   |  | 1,289        |   |  |            |   |  | 1,289       |  
|Total Expenses                               |  | 1,925,188           |   |  | 117,422      |   |  | 362,696      |   |  | 515,660     |   |  | 567,945     |  
|Net Loss Before Other Items                  |  | (1,910,230          | ) |  | (116,767     | ) |  | (360,480     | ) |  | (513,800    | ) |  | (562,829    | )
|Provision for loan receivable                |  | (75,000             | ) |  |             |   |  |             |   |  |            |   |  |            |  
|Net Loss                                     |  | (1,985,230          | ) |  | (116,767     | ) |  | (360,480     | ) |  | (513,800    | ) |  | (562,829    | )
|                                             |  |                     |   |  |              |   |  |              |   |  |             |   |  |             |  
|Net Loss Per Share
       Basic and Diluted |  |                     |   |  |             |   |  |             |   |  | (0.01       | ) |  | (0.01       | )
|                                             |  |                     |   |  |              |   |  |              |   |  |             |   |  |             |  
|Weighted Average
      Shares Outstanding    |  |                     |   |  | 81,088,000   |   |  | 81,088,000   |   |  | 81,088,000  |   |  | 81,088,000  |  

(The Accompanying Notes are an Integral Part of These Financial
Statements)

F-2

---

|MASS Petroleum Inc.           
|------------------------------
|(An Exploration Stage Company)
|Statements of Cash Flows      
|(Expressed in US dollars)     
|(unaudited)                   

|                                                                                  |  | For the     |   |  | For the     |  
|--------------------------------------------------------------------------------- |  | ----------- | - |  | ----------- | -
|                                                                                  |  | Nine months |   |  | Nine months |  
|                                                                                  |  | Ended       |   |  | Ended       |  
|                                                                                  |  | August 31,  |   |  | August 31,  |  
|                                                                                  |  | 2009        |   |  | 2008        |  
|                                                                                  |  | $           |   |  | $           |  
|                                                                                  |  |             |   |  |             |  
|Operating Activities                                                              |  |             |   |  |             |  
|                                                                                  |  |             |   |  |             |  
|Net loss                                                                          |  | (513,800    | ) |  | (562,829    | )
|                                                                                  |  |             |   |  |             |  
|Adjustments to reconcile net
      loss to net cash used in operating activities: |  |             |   |  |             |  
|Depletion                                                                         |  | 973         |   |  | 3,574       |  
|Depreciation                                                                      |  | 565         |   |  | 848         |  
|Donated services and rent                                                         |  |            |   |  | 7,500       |  
|Stock-based
      compensation                                                    |  | 402,360     |   |  | 297,080     |  
|                                                                                  |  |             |   |  |             |  
|Changes in operating assets
      and liabilities                                 |  |             |   |  |             |  
|Amounts receivable                                                                |  | (1,987      | ) |  | (450        | )
|Prepaid expenses                                                                  |  | 4,563       |   |  | (13,044     | )
|Accounts payable                                                                  |  | 13,390      |   |  | 18,100      |  
|Accrued
      liabilities                                                         |  | 50          |   |  | 58,891      |  
|Due to related parties                                                            |  | 25,685      |   |  | 18,192      |  
|                                                                                  |  |             |   |  |             |  
|Net Cash Used In
      Operating Activities                                       |  | (68,201     | ) |  | (172,138    | )
|                                                                                  |  |             |   |  |             |  
|Investing Activities                                                              |  |             |   |  |             |  
|                                                                                  |  |             |   |  |             |  
|Loan
      receivable                                                             |  |            |   |  | (75,000     | )
|                                                                                  |  |             |   |  |             |  
|Net Cash Used in
      Investing Activities                                       |  |            |   |  | (75,000     | )
|Financing Activities                                                              |  |             |   |  |             |  
|                                                                                  |  |             |   |  |             |  
|Deferred financing costs                                                          |  |            |   |  | (17,500     | )
|Proceeds from loan payable                                                        |  | 27,500      |   |  | 25,000      |  
|Proceeds from related party loan                                                  |  |            |   |  | 50,000      |  
|                                                                                  |  |             |   |  |             |  
|Net Cash Provided by Financing Activities                                         |  | 27,500      |   |  | 57,500      |  
|                                                                                  |  |             |   |  |             |  
|Decrease in Cash                                                                  |  | (40,701     | ) |  | (189,638    | )
|                                                                                  |  |             |   |  |             |  
|Cash - Beginning of Period                                                        |  | 45,994      |   |  | 229,288     |  
|                                                                                  |  |             |   |  |             |  
|Cash - End of Period                                                              |  | 5,293       |   |  | 39,650      |  
|                                                                                  |  |             |   |  |             |  
|Supplemental Disclosures                                                          |  |             |   |  |             |  
|                                                                                  |  |             |   |  |             |  
|Interest paid                                                                     |  |             |   |  |            |  
|Income taxes paid                                                                 |  |             |   |  |            |  

(The Accompanying Notes are an Integral Part of These Financial
Statements)

F-3

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|1. | Nature of Operations and Continuance of
Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | The Company was incorporated in the State of Nevada on
      February 14, 2006 under the name XTOL Energy Inc. On October 11, 2008, the
      Company changed its name to LAUD Resources Inc. On June 23, 2008, the
      Company changed its name from LAUD Resources Inc. to MASS Petroleum Inc.
      The Company is an Exploration Stage Company, as defined by Statement of
      Financial Accounting Standard (SFAS) No.7 Accounting and Reporting
      for Development Stage Enterprises. The Companys principal business
      is the acquisition and exploration of oil and gas properties located in
      the United States.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | On January 24, 2008, the Company incorporated APIC
      Resources, Inc. (APIC) as its wholly owned subsidiary. On February 5,
      2008, the Company declared a dividend of $0.000001 for each of the
      Companys 81,088,000 common shares outstanding as of February 5, 2008. The
      Company satisfied this dividend by arranging APIC to issue one share of
      their common stock for every $0.0001 of dividend declared. This
      effectively became an issuance of one APIC share for every 100 shares of
      the Companys stock held by the shareholders as of February 5, 2008. These
      shares were issued without a prospectus in reliance on Regulation S and
      pursuant to exemptions from registration under Section 4(2) of the
      Securities Act of 1933. In conjunction with this arrangement, the Company
      cancelled its 100 shares in APIC and as of February 5, 2008, the Company
      no longer owned any shares in APIC. APIC had no operations or assets prior
      to the spin off.                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   | These financial statements have been prepared on a going
      concern basis, which implies the Company will continue to realize its
      assets and discharge its liabilities in the normal course of business. The
      Company has not generated significant revenues since inception and has
      never paid any dividends and is unlikely to pay dividends or generate
      earnings in the immediate or foreseeable future. The continuation of the
      Company as a going concern is dependent upon the continued financial
      support from its shareholders, the ability of the Company to obtain
      necessary equity financing to continue operations, and the attainment of
      profitable operations. As at August 31, 2009, the Company has a working
      capital deficit of $291,222, has not generated significant revenue and has
      accumulated losses totaling $1,985,230 since inception. These factors
      raise substantial doubt regarding the Companys ability to continue as a
      going concern. These financial statements do not include any adjustments
      to the recoverability and classification of recorded asset amounts and
      classification of liabilities that might be necessary should the Company
      be unable to continue as a going concern.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|2. | Summary of Significant Accounting
  Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

| | a) | Basis of Presentation                                                                                                                                                                                                                        
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                              
| |    | These financial statements and related notes are
      presented in accordance with accounting principles generally accepted in
      the United States, and are expressed in US dollars. The Companys fiscal
      year-end is November 30.

| | b) | Interim Financial Statements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | These interim unaudited financial statements have been
      prepared on the same basis as the annual financial statements and in the
      opinion of management, reflect all adjustments, which include only normal
      recurring adjustments, necessary to present fairly the Companys financial
      position, results of operations and cash flows for the periods shown. The
      results of operations for such periods are not necessarily indicative of
      the results expected for a full year or for any future
  period.

| | c) | Use of Estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    | The preparation of financial statements in conformity
      with US generally accepted accounting principles requires management to
      make estimates and assumptions that affect the reported amounts of assets
      and liabilities and disclosure of contingent assets and liabilities at the
      date of the financial statements and the reported amounts of revenues and
      expenses during the reporting period. The Company regularly evaluates
      estimates and assumptions related to the valuation of long-lived assets
      and oil and gas properties, stock-based compensation and deferred income
      tax asset valuation allowances. The Company bases its estimates and
      assumptions on current facts, historical experience and various other
      factors that it believes to be reasonable under the circumstances, the
      results of which form the basis for making judgments about the carrying
      values of assets and liabilities and the accrual of costs and expenses
      that are not readily apparent from other sources. The actual results
      experienced by the Company may differ materially and adversely from the
      Companys estimates. To the extent there are material differences between
      the estimates and the actual results, future results of operations will be
      affected.

F-4

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | d)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | e)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | f)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | g)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | h)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           

F-5

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | i)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | j)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | k)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | l)                                                        
|   |                                                           
|   |                                                           

Level 1

Level 1 applies to assets or
liabilities for which there are quoted prices in active markets for identical
assets or liabilities.

Level 2

Level 2 applies to assets or
liabilities for which there are inputs other than quoted prices that are
observable for the asset or liability such as quoted prices for similar assets
or liabilities in active markets; quoted prices for identical assets or
liabilities in markets with insufficient volume or infrequent transactions (less
active markets); or model-derived valuations in which significant inputs are
observable or can be derived principally from, or corroborated by, observable
market data.

Level 3

Level 3 applies to assets or
liabilities for which there are unobservable inputs to the valuation methodology
that are significant to the measurement of the fair value of the assets or
liabilities.

The Companys financial instruments
consist principally of cash, accounts payable, amounts due to related parties,
and loans payable. Pursuant to SFAS No. 157, the fair value of our cash
equivalents is determined based on Level 1 inputs, which consist of quoted
prices in active markets for identical assets. The Company believes that the
recorded values of all of the other financial instruments approximate their
current fair values because of their nature and respective maturity dates or
durations.

F-6

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | l)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | m)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | n)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | o)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | p)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   | q)                                                        
|   |                                                           
|   |                                                           

F-7

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | q)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           

F-8

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | q)                                                        
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|3. | Property and Equipment                                    

| |                   |  |       |  |  |              |  |  | August 31,   |  |  | November 30, | 
| | ----------------- |  | ----- |  |  | ------------ |  |  | ------------ |  |  | ------------ | 
| |                   |  |       |  |  |              |  |  | 2009         |  |  | 2008         | 
| |                   |  |       |  |  | Accumulated  |  |  | Net Carrying |  |  | Net Carrying | 
| |                   |  | Cost  |  |  | Depreciation |  |  | Value        |  |  | Value        | 
| |                   |  | $     |  |  | $            |  |  | $            |  |  | $            | 
| |                   |  |       |  |  |              |  |  |              |  |  |              | 
| | Computer hardware |  | 3,391 |  |  | 3,391        |  |  |             |  |  | 565          | 

|4. | Oil and Gas Property
|-- | --------------------

| |                             |  | August 31,   |   |  | November 30, |  
| | --------------------------- |  | ------------ | - |  | ------------ | -
| |                             |  | 2009         |   |  | 2008         |  
| |                             |  | Net Carrying |   |  | Net Carrying |  
| |                             |  | Value        |   |  | Value        |  
| |                             |  | $            |   |  | $            |  
| |                             |  |              |   |  |              |  
| | Proved Properties, Oklahoma |  |              |   |  |              |  
| |                             |  |              |   |  |              |  
| | Acquisition Costs           |  | 34,038       |   |  | 34,038       |  
| | Depletion                   |  | (21,959      | ) |  | (20,986      | )
| |                             |  |              |   |  |              |  
| | Net Carrying Value          |  | 12,079       |   |  | 13,052       |  

On August 1, 2006, the Company acquired
a 2.34% non operating interest in three oil and gas wells located in Oklahoma
for $34,038.

F-9

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|5. | Loan Receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | On July 3, 2008, the Company entered into a loan
      agreement with Uraltransneft Co. Ltd. (Uraltransneft) and advanced
      $75,000 to Uraltransneft. The loan is due on January 1, 2009, bears
      interest at 0.50% per annum and is unsecured. The Company did not collect
      the loan after it became due on January 1, 2009. As there was uncertainty
      as to the collectability of the loan at November 30, 2008, a provision was
      recognized for the entire amount.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|6. | Loans Payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|7. | Related Party Transactions                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

F-10

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|7. | Related Party Transactions
(continued)
|-- | --------------------------------------

| | f) | On October 8, 2008, the Company entered into a loan
      agreement with a director of the Company for $30,000 which is due on
      October 1, 2009 or within seven days of the Company completing a financing
      in excess of $800,000, is unsecured and bears interest at 5% per annum. As
      at August 31, 2009, the Company is also indebted to this director for
      $13,358 (November 30, 2008 - $9,100), representing expenditures paid on
      behalf of the Company. These amounts is unsecured, non-interest bearing
      and due on demand.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. | Stock Options
|-- | -------------

On June 9, 2008, the Company granted
500,000 stock options to the CFO with an exercise price of $1.50 per share. The
stock options will vest at the rate of 125,000 options on December 6, 2008, June
6, 2009, December 6, 2009, and June 6, 2010. The stock options will be
exercisable until the earlier of two years following their respective vesting
dates or upon termination of the agreement. However, if during the term of the
agreement any third party who is not affiliated with the Company as of the date
of the agreement assumes control of the Company or acquires substantially all of
the Companys assets, all 500,000 stock options will vest immediately and may be
exercised for a period of ninety days following the effective date of such
change of control or disposition of assets. The fair value of these stock
options was estimated at the date of grant using the Black-Scholes
option-pricing model assuming an expected life of 3.25 year, a risk-free rate of
3.28%, an expected volatility of 96%, and a 0% dividend yield. The weighted
average fair value of stock options granted was $1.39 per share.

On March 24, 2009, the Company entered
into an option amendment agreement to re-price the exercise price of 500,000
stock options from $1.50 per share to $0.50 per share. The option amendment
agreement also extended the term of the 500,000 stock options to June 5, 2013.
In accordance with SFAS No. 123R, modifications to the terms of an award are
treated as an exchange of the original award for a new award. Incremental
interest expense is measured as the excess, if any, of the fair value of the
original award immediately before its terms are modified, measured based on the
share price and other pertinent factors at that date. During the nine month
period ended August 31, 2009, the Company recognized an incremental compensation
cost of $37,293 for these modified stock options.

As at August 31, 2009, there were
250,000 unvested stock options. During the nine month period ended August 31,
2009, the Company recorded stock-based compensation of $286,094, including the
incremental compensation cost of $37,293 resulting from the amendment, as
general and administrative expense.

A summary of the Companys stock option
activity is as follows:

| |                                |  |           |  |  | Weighted |  |  | Weighted     |  |  |           | 
| | ------------------------------ |  | --------- |  |  | -------- |  |  | ------------ |  |  | --------- | 
| |                                |  |           |  |  | Average  |  |  | Average      |  |  | Aggregate | 
| |                                |  |           |  |  | Exercise |  |  | Remaining    |  |  | Intrinsic | 
| |                                |  | Number of |  |  | Price*   |  |  | Contractual  |  |  | Value     | 
| |                                |  | Options   |  |  | $        |  |  | Life (years) |  |  | $         | 
| |                                |  |           |  |  |          |  |  |              |  |  |           | 
| | Outstanding, November 30, 2008 |  | 500,000   |  |  | 1.50     |  |  |              |  |  |           | 
| | Granted                        |  | -         |  |  | -        |  |  |              |  |  |           | 
| |                                |  |           |  |  |          |  |  |              |  |  |           | 
| | Forfeited                      |  | -         |  |  | -        |  |  |              |  |  |           | 
| |                                |  |           |  |  |          |  |  |              |  |  |           | 
| |                                |  |           |  |  |          |  |  |              |  |  |           | 
| | Outstanding, August 31, 2009   |  | 500,000   |  |  | 0.50*    |  |  | 3.77         |  |  | 5,000     | 
| |                                |  |           |  |  |          |  |  |              |  |  |           | 
| | Exercisable, August 31, 2009   |  | 250,000   |  |  | 0.50*    |  |  | 3.77         |  |  | 2,500     | 

*August 31, 2009 weighted average
exercise price was revised pursuant to the March 24, 2009 option amendment
agreement

F-11

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|8. | Stock Options (continued)
|-- | -------------------------

A summary of the status of the
Companys non-vested stock options as of August 31, 2009, and changes during the
nine month period ended August 31, 2009, is presented below:

| |                                 |  |           |   |  | Weighted    | 
| | ------------------------------- |  | --------- | - |  | ----------- | 
| |                                 |  |           |   |  | Average     | 
| |                                 |  | Number of |   |  | Fair Value* | 
| | Non-vested options              |  | Options   |   |  | $           | 
| |                                 |  |           |   |  |             | 
| |                                 |  |           |   |  |             | 
| | Non-vested at November 30, 2008 |  | 500,000   |   |  | 1.39        | 
| |                                 |  |           |   |  |             | 
| | Vested                          |  | (250,000  | ) |  | 1.39        | 
| |                                 |  |           |   |  |             | 
| | Non-vested at August 31, 2009   |  | 250,000   |   |  | 1.39*       | 

*August 31, 2009 weighted average fair
value was revised pursuant to the March 24, 2009 option amendment agreement

As at August 31, 2009, there was
$110,226 of unrecognized compensation costs related to non-vested share-based
compensation, which is expected to be recognized over a weighted average period
of 0.76 years.

|9. | Share Exchange Agreement
|-- | ------------------------

On May 19, 2008, the Company entered
into a share exchange agreement and addendum (collectively the Agreement) with
Uraltransneft Co. Ltd. (Uraltransneft), a Russia corporation, and its selling
shareholders. Uraltransneft is based in Perm, Russia, where it holds a crude oil
and gas production license, and is engaged in the businesses of oil exploration,
extraction, processing, distribution, transportation and related services.
Pursuant to the Agreement the Company will issue 41,100,000 shares of common
stock to the selling shareholders in exchange for all outstanding shares of
Uraltransneft. Closing of the Agreement will result in Uraltransneft becoming a
wholly owned subsidiary of the Company. Additionally, the three selling
shareholders of Uraltransneft will each hold approximately 13,700,000 common
shares (the equivalent of 16.8%) of the Companys issued and outstanding common
stock. The Company has shifted its focus from Russia to North America to take
advantage of stable low to medium risk opportunities that have emerged due to
current economic conditions and as at August 31, 2009, the agreement with
Uraltransneft has been terminated.

|10. | Commitments
|--- | -----------

| | a) | On August 5, 2009, the Company entered into a non-binding
      Letter of Intent with Guardian Exploration Inc. (Guardian) whereby the
      Company will purchase Guardians working interest in the Girouxville
      Project. The Girouxville Project consists of a high working interest in
      three light oil wells. The project is located in Alberta and is surrounded
      by other producing oil companies. The preliminary terms are that the
      Company will acquire 100% of Guardians working interest for a total price
      of Cdn$3,350,000, comprised of Cdn$2,000,000 cash and 2,700,000 shares of
      the Companys common stock. The transaction was scheduled to close before
      September 30, 2009, but is subject to the Companys due diligence
      investigation and also the negotiation of a final, formal
  contract.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | b) | On August 19, 2008, the Company entered into an agreement
      with Gryphon Trade and Finance, LLC for financial advisory services in
      connection with the equity raising and/or senior debt financing. Pursuant
      to the agreement, the Company agreed to pay (a) $17,500 (paid) within
      three business days upon signing of the agreement, (b) an additional
      payment of $17,500 within ten business days of accepting a funding
      proposal in the amount of at least $83,000,000, (c) 3% of the amount of
      the senior debt capital raised and (d) 5% of the amount of the equity
      capital raised. As at August 31, 2009, the agreement has been
      terminated.                                                                                                                                                            

F-12

---

|MASS Petroleum Inc.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|(Expressed in US dollars)        
|(unaudited)                      

|11. | Subsequent Events
|--- | -----------------

Effective this quarter, the Company
implemented SFAS No. 165, Subsequent Events (SFAS 165). This standard
establishes general standards of accounting for and disclosure of events that
occur after the balance sheet date but before financial statements are issued.
The adoption of SFAS 165 did not impact the Companys financial position or
results of operations. The Company evaluated all events or transactions that
occurred after August 31, 2009 up through October 20, 2009, the date the Company
issued these financial statements. During this period, the Company did not have
any material recognizable subsequent events other than as disclosed below:

| | a) | The Company received cash advances of $20,000 from a
      shareholder, which are unsecured, non-interest bearing and has no
      repayment terms. The advances were provided for working capital
      purposes.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-13

---

ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

Forward Looking Statements

This report on Form 10-Q contains certain forward-looking
statements. All statements other than statements of historical fact are
forward-looking statements for purposes of these provisions, including any
projections of earnings, revenues, or other financial items; any statements of
the plans, strategies, and objectives of management for future operation; any
statements concerning proposed new products, services, or developments; any
statements regarding future economic conditions or performance; statements of
belief; and any statement of assumptions underlying any of the foregoing. Such
forward-looking statements are subject to inherent risks and uncertainties, and
actual results could differ materially from those anticipated by the
forward-looking statements.

Business Overview

MASS Petroleum Inc. (MASS, we, us) is a start up oil and
gas exploration company. We were incorporated in the State of Nevada on February
14, 2006, under the name of XTOL Energy Inc. We operated under this name until
October 10, 2008 at which time we changed our name to LAUD Resources Inc. On
June 23, 2008 we changed our name to MASS Petroleum Inc. and on July 11, 2008,
the new symbol for the quotation of our common stock on the Over the Counter
Bulletin board became MASP.OB. We do not have any subsidiaries. Our principal
office is located at Suite 507  700 West Pender Street, Vancouver, British
Columbia, V6C 1G8. Our telephone number is (604) 688-6380. Our fiscal year end
is November 30.

We have incurred losses since our inception. We rely upon the
sale of our securities to fund our operations. We have generated limited
revenues of $14,958 from our 2.34% non-operated interest in three operating
wells in Kingfisher County, Oklahoma since our inception to August 31, 2009.

We intend to build our business through the acquisition of producing
  and exploration stage oil and natural gas wells, interests and leases. Our strategy
  is to combine the secure and reliable revenue source of operated and non-operated
  interests from producing oil wells with the higher risk development of oil and
  gas exploration projects. For the next 12 months (beginning November 2009),
  we plan to purchase additional operated and non-operated interests in producing
  oil and natural gas properties, to acquire additional exploration stage properties
  and carry out an exploration program on the acquired properties. We are not
  involved in any bankruptcy, receivership or similar proceedings.

As of August 31, 2009, we terminated the share exchange agreement
  and addendum that we entered into with Uraltransneft Co., Ltd. and the selling
  shareholders of Uraltransneft (entered into on May 19, 2008 and disclosed by
  us in our report on Form 8-K dated May 19, 2008). Our management has decided
  to shift our focus from Russia to North America to take advantage of stable
  low to medium risk opportunities that have emerged due to current economic conditions.
  We have no further obligations or liabilities pursuant to this transaction.

As previously disclosed on our Form 8-K dated August 5, 2009,
  we entered into a non-binding Letter of Intent with Guardian Exploration Inc.
  (“Guardian”) whereby we would purchase Guardian’s working
  interest in the Girouxville Project. The Girouxville Project consists of a high
  working interest in three light oil wells. The project is located in Alberta
  and is surrounded by other producing oil companies. The preliminary terms are
  that we will acquire 100% of Guardian’s working interest for a total price
  of CAD $3,350,000, comprised of CAD $2,000,000 cash and 2,700,000 shares of
  our common stock. The transaction was scheduled to close before September 30,
  2009, but is subject to our due diligence investigation and also the negotiation
  of a final, formal contract. We are currently still conducting our due diligence
  on this project.

2

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Liquidity and Capital Resources

As of August 31, 2009, we had cash of $5,293 and a working
capital deficit of $291,222. Our accumulated deficit from inception to August
31, 2009 was $1,985,230. Our net loss of $513,800 for the nine months ended
August 31, 2009 was mostly funded by funds raised from equity financing since
inception and from loans. During the nine months ended August 31, 2009, we did
not raise any funds through the sale of our equities compared to $nil provided
through equity financing during the same period in 2008. During the nine months
ended August 31, 2009 our cash position decreased by $40,701.

We used net cash of $68,201 in operating activities for the
nine months ended August 31, 2009 compared to net cash of $172,138 used in
operating activities for the same period in 2008. This decrease in cash used in
operating activities was mainly due to less accrued liabilities and higher
stock-based compensation.

During the nine months ended August 31, 2009 our monthly cash
requirement was $7,578 compared to $19,126 for the same period in 2008. At
August 31, 2009, we had cash of $5,293, which will cover our costs for less than
1 month according to our current monthly burn rate.

We expect to require approximately $1,000,000 in financing to
continue our planned operation and exploration over the next year plus another
$1,000,000 to cover our other operational expenses.

Our planned acquisition and exploration expenditures for oil
and gas interests and properties over the next twelve months (beginning November
2009) are summarized as follows:

Description
    Potential
      completion date
    Estimated
      Expenses ($)Retain a full-time
      engineer and a full-time Geologist
    February 1, 2010
    400,000Conduct preliminary evaluation of potential exploration
      stage oil and gas properties for acquisition
    April 1, 2010
    600,000Total
    
    1,000,000


3

---

Our other planned operational expenses for the next 12 months
(beginning November 2009) are summarized as follows:

Description
    Potential
      completion date
    Estimated
      Expenses ($)Select and appoint
      a new Board member
    February 1, 2010
    10,000Raise additional private or public equity (legal,
      accounting and marketing fees)
    12 months
    150,000General and administrative expenses
    12 months
    100,000Professional fees (legal, accounting and auditing fees)
    12 months
    250,000Consultant, officer, and employee fees
    12 months
    450,000Marketing expenses
    12 months
    40,000Total
    
    1,000,000


We intend to raise the $2,000,000 to fund our operations for
the next 12 months from private placements, shareholder loans or possibly a
registered public offering (either self-underwritten or through a broker-dealer)
within the next few months. If we are unsuccessful in raising enough money
through future capital raising efforts, we may review other financing
possibilities such as bank loans. At this time we do not have any commitments
from any broker-dealer to provide us with financing.

There is no assurance that any financing will be available or
if available, on terms that will be acceptable to us. We also may need
additional financing to carry out our business plan.

Obtaining additional financing will be subject to a number of
factors including market conditions, investor acceptance of our business plan,
and investor sentiment. These factors may make the timing, amount, terms and
conditions of additional financing unattractive or unavailable to us. If we
cannot raise at least $2,000,000 we will have to significantly reduce our
spending, delay or cancel planned activities or substantially change our current
corporate structure. In such an event, we intend to implement expense reduction
plans in a timely manner. However, these actions would have material adverse
effects on our business, revenues, operating results, and prospects, resulting
in a possible failure of our business. We may need to obtain additional
financing which may not be available, which could cause us to cease
operations.

4

---

Results of Operations

We began to earn nominal revenues in February 2008 from our
non-operated working interests in three producing wells. We plan to purchase
additional non-operated and operated working interests in existing oil and gas
leases.

Revenues

We have generated $14,958 in revenues from our 2.34%
non-operating interest in the Kingfisher property since February 14, 2006
(inception) to August 31, 2009. We generated revenues of $1,860 for the nine
months ended August 31, 2009 compared to $5,116 for the nine months ended August
31, 2008. We generated revenues of $655 for the three months ended August 31,
2009 and $2,216 for the three months ended August 31, 2008.

Net Loss

We incurred a net loss of $513,800 for the nine months ended
August 31, 2009 compared to our net loss of $562,829 for the nine months ended
August 31, 2008. The difference for the decrease in net loss was less general
and administrative expenses. We incurred net loss of $116,767 for the three
months ended August 31, 2009 and $360,480 for the three months ended August 31,
2008. Since February 14, 2006 (date of inception) to August 31, 2009, we have
incurred a net loss of $1,985,230.

5

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Expenses

Our total expenses for the nine months ended August 31, 2009
were $515,660 compared to $567,945, for the same period in 2008. Our total
expenses were $117,422 for the three months ended August 31, 2009 and $362,696
for the three months ended August 31, 2008. The decrease in our expenses during
2009 was attributable to less general and administrative expenses. Our general
and administrative expenses decreased by $242,262 from $359,059 for the three
months ended August 31, 2008 compared to $116,797 for the three months ended
August 31, 2009 because of stock based compensation. Our general and
administrative expenses were $513,179 for the nine months ended August 31, 2009
compared to $561,012 for the same period in 2008.

Our general and administrative expenses consist of professional
fees, management and consulting fees, stock based compensation, bank charges,
travel, meals and entertainment, rent, office maintenance, communications
(cellular, internet, fax and telephone), courier, postage costs and office
supplies.

Inflation

The amounts presented in the financial statements do not
provide for the effect of inflation on our operations or financial position. The
net operating losses shown would be greater than reported if the effects of
inflation were reflected either by charging operations with amounts that
represent replacement costs or by using other inflation adjustments.

Off-Balance Sheet Arrangements

As of August 31, 2009, we had no off balance sheet transactions
that have or are reasonably likely to have a current or future effect on our
financial condition, changes in our financial condition, revenues or expenses,
results of operations, liquidity, capital expenditures or capital resources.

ITEM 4. CONTROLS AND PROCEDURES

N/A

ITEM 4T. CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures

Gary Chayko, our Chief Executive Officer and Vitaly Melnikov,
our Chief Financial Officer evaluated our disclosure controls and procedures
(as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Securities Exchange Act
of 1934 (the Exchange Act) as of a date within 90 days before the filing date
of this report and has concluded that as of the evaluation date, our disclosure
controls and procedures are effective to ensure that information we are required
to disclose in reports that we file or submit under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified
in the Securities and Exchange Commissions rules and forms.

(b) Changes in internal controls

Subsequent to the date of their evaluation, there were no
changes in our internal controls over financial reporting or in other factors
that could significantly affect these controls.

6

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PART II  OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Management is not aware of any legal proceedings contemplated
by any governmental authority or any other party against us. None of our
directors, officers or affiliates are (i) a party adverse to us in any legal
proceedings, or (ii) have an adverse interest to us in any legal proceedings.
Management is not aware of any other legal proceedings that have been threatened
against us.

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

As of August 31, 2009, we terminated the share exchange agreement
  and addendum that we entered into with Uraltransneft Co., Ltd. and the selling
  shareholders of Uraltransneft (entered into on May 19, 2008 and disclosed by
  us in our report on Form 8-K dated May 19, 2008). Our management has decided
  to shift our focus from Russia to North America to take advantage of stable
  low to medium risk opportunities that have emerged due to current economic conditions.
  We have no further obligations or liabilities pursuant to this transaction.

ITEM 6. EXHIBITS

|Exhibit | Exhibit                                                                                                                                                                     
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description                                                                                                                                                                 
|31.1    | Certification
        of the Chief Executive Officer Pursuant to Rule 13a-14 or 15d-14 of the
        Exchange Act pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|31.2    | Certification
        of the Chief Financial Officer Pursuant to Rule 13a-14 or 15d-14 of the
        Exchange Act pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|32.1    | Certification
        of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as adopted
        pursuant to Section 906 of the Sarbanes-Oxley Act of 2002        
|32.2    | Certification
        of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as adopted
        pursuant to Section 906 of the Sarbanes-Oxley Act of 2002        

7

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Exchange Act, the Registrant has duly caused this Quarterly Report to be signed
on its behalf by the undersigned thereunto duly authorized.

|Date: October 20, 2009 | By: | /s/ Gary Chayko           
|---------------------- | --- | --------------------------
|                       |     | Gary Chayko               
|                       |     | President, Chief Executive
|                       |     | Officer and Director      
|                       |     |                           
|Date: October 20, 2009 | By: | /s/ Jordan Shapiro        
|                       |     | Jordan Shapiro            
|                       |     | Secretary, Treasurer      
|                       |     | and Director              
|                       |     |                           
|Date: October 20, 2009 | By: | /s/ Vitaly Melnikov       
|                       |     | Vitaly Melnikov           
|                       |     | Chief Financial Officer   
|                       |     | and Director              

8

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