UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      D.C. 20549





FORM
      10-QSB





T
            Quarterly
                report pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934 For the quarterly period ended: March 31,
                2007





o
            Transition
                report pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934 For the transition period from _______ to
                _________





Commission
      file number: 0-49837





WESTSIDE
                ENERGY CORPORATION(Exact
                name of small business issuer as specified in its
                charter)





Nevada
            88-0349241(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer Identification No.)





3131
                Turtle Creek Blvd, Ste 1300, Dallas, TX
            75219(Address
                of principal executive officer)
            (Zip
                Code)





214/522-8990(Issuer’s
                telephone number)





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days. Yes   TNo   o





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act). Yes   oNo   T





The
      number of shares of common stock, $.01 par value, outstanding as of May 16,
      2007: 21,476,526 shares





Transitional
      Small Business Disclosure Format (check
      one):   Yes   o   No   T















WESTSIDE
      ENERGY CORPORATION


PERIOD
      ENDED MARCH 31, 2007





INDEX


PART
                  I.  FINANCIAL INFORMATION
              PageITEM
                  1.  FINANCIAL STATEMENTS
              1Financial
                  statements of Westside Energy Corporation:
              1Consolidated
                  balance sheets as of March 31, 2007 and December
                  31, 2006
              1Consolidated
                  statements of operations for the three months
                  ended March 31, 2007 and March 31, 2006
              2Consolidated
                  statements of cash flows for the three
                  months ended March 31, 2007 and March 31, 2006
              3Notes
                  to consolidated financial
                  statements
              4ITEM
                  2.  MANAGEMENT’S DISCUSSION AND
                  ANALYSIS
              7ITEM
                  3.  CONTROLS AND
                  PROCEDURES
              12PART
                  II.  OTHER INFORMATION
              12ITEM
                  1.   LEGAL
                  PROCEEDINGS
              12ITEM
                  2.  UNREGISTERED SALES OF EQUITY SECURITIES
                  AND USE OF PROCEEDS
              12ITEM
                  6.   EXHIBITS
              13SIGNATURES
              13





*Index*





**PART
      I.   FINANCIAL INFORMATION**





**ITEM
      1.   FINANCIAL
      STATEMENTS**





WESTSIDE
        ENERGY CORPORATION
 CONSOLIDATED
        BALANCE SHEETS
 (unaudited)
 
 March
                  31,2007
              
              
              December
                  31,2006ASSETSCurrent
                  assetsCash
              
              $
              14,826,264
              
              
              $
              5,003,803Certificates
                  of deposit and escrow account
              
              
              27,887
              
              
              
              27,887Marketable
                  securities
              
              
              -
              
              
              
              425,000Accounts
                  receivable
              
              
              4,432,502
              
              
              
              5,189,504Derivative
                  asset
              
              
              -
              
              
              
              169,885Prepaid
                  assets
              
              
              9,946
              
              
              
              122,914Total
                  current assets
              
              
              19,296,599
              
              
              
              10,938,993Oil
                  and gas properties, using successful efforts accountingProved
                  properties
              
              
              28,268,404
              
              
              
              23,681,084Unproved
                  properties
              
              
              8,419,772
              
              
              
              10,319,150Accumulated
                  depreciation, depletion and amortization
              
              
              (11,673,530
              )
              
              
              (10,851,176
              )Net
                  oil and gas properties
              
              
              25,014,646
              
              
              
              23,149,058Deferred
                  financing costs
              
              
              325,007
              
              
              
              265,907Property
                  and equipment net of accumulated depreciation
                  of  $102,941
              
              
              140,037
              
              
              
              150,322TOTAL
                  ASSETS
              
              $
              44,776,289
              
              
              $
              34,504,280LIABILITIES
                  AND STOCKHOLDERS' EQUITYCurrent
                  liabilitiesAccounts
                  payable and accrued expenses
              
              $
              6,876,418
              
              
              $
              7,171,069Short
                  term portion of debt - related party
              
              
              -
              
              
              
              -Short
                  term portion of debt
              
              
              -
              
              
              
              3,997,500Derivative
                  liability
              
              
              183,521
              
              
              
              -Total
                  current liabilities
              
              
              7,059,939
              
              
              
              11,168,569Non-current
                  liabilitiesAsset
                  retirement obligations
              
              
              166,503
              
              
              
              153,487Long
                    term portion of debt - related party, net of discountof
                    $269,206 and $0, respectively.
              
              
              24,730,794
              
              
              
              -Long
                  term portion of debt, net of discount of $0 and $404,325,
                  respectively.
              
              
              -
              
              
              
              7,609,057TOTAL
                  LIABILITIES
              
              
              31,957,236
              
              
              
              18,931,113STOCKHOLDERS'
                  EQUITYPreferred
                  stock, $.01 par value, 10,000 shares authorized, none issued and
                  outstanding
              
              
              -
              
              
              
              -Common
                  stock, $.01 par value, 50,000 shares authorized, 21,466,526 and
                  21,461,909
                  shares issued and outstanding
              
              
              214,665
              
              
              
              214,619Additional
                  paid in capital
              
              
              34,567,080
              
              
              
              34,501,241Accumulated
                  comprehensive income (loss)
              
              
              (183,521
              )
              
              
              169,885Accumulated
                  deficit
              
              
              (21,779,171
              )
              
              
              (19,312,578
              )TOTAL
                  STOCKHOLDERS' EQUITY
              
              
              12,819,053
              
              
              
              15,573,167TOTAL
                  LIABILITIES AND STOCKHOLDERS' EQUITY
              
              $
              44,776,289
              
              
              $
              34,504,280
 
 See
        accompanying notes to consolidated financial statements.
  1
 *Index*
  WESTSIDE
        ENERGY CORPORATION
 CONSOLIDATED
        STATEMENTS OF OPERATIONS
 (unaudited)
 
 Three
                  Months Ended March 31,**2007**
              
              
              **2006****Revenues**Oil
                  & Gas Sales
              
              $
              915,227
              
              
              $
              352,401**Expenses**Production
              
              
              498,015
              
              
              
              250,268Exploration
              
              
              -
              
              
              
              65General
                  and administrative
              
              
              1,016,224
              
              
              
              1,442,402Depreciation,
                  depletion, and amortization
              
              
              841,651
              
              
              
              175,062Total
                  Expenses
              
              
              2,355,890
              
              
              
              1,867,797**Loss
                  from operations**
              
              
              (1,440,663
              )
              
              
              (1,515,396
              )**Other
                  Income (Expense)**Interest
                  income
              
              
              30,203
              
              
              
              76,854Interest
                  expense
              
              
              (1,056,133
              )
              
              
              (40,793
              )Total
                  Other Income [Expense]
              
              
              (1,025,930
              )
              
              
              36,061NET
                  LOSS
              
              $
              (2,466,593
              )
              
              $
              (1,479,335
              )Other
                comprehensive loss:Unrealized
                  loss on derivative instruments
              
              
              (353,406
              )
              
              
              (110,932
              )Total
                comprehensive loss
              
              $
              (2,819,999
              )
              
              $
              (1,590,267
              )Basic
                  and diluted loss per common share
              
              $
              (0.11
              )
              
              $
              (0.07
              )Weighted
                  average common shares outstanding
              
              
              21,458,798
              
              
              
              20,398,211
 
 See
        accompanying notes to consolidated financial statements.


2
 *Index*




WESTSIDE
        ENERGY CORPORATION
 CONSOLIDATED
        STATEMENTS OF CASH FLOWS
 (unaudited)
 
 Three
                  months ended March 31,2007
              
              
              2006CASH
                  FLOWS FROM OPERATING ACTIVITIESNet
                  loss
              
              $
              (2,466,593
              )
              
              $
              (1,479,335
              )Adjustments
                  to reconcile:Stock
                  for services
              
              
              66,068
              
              
              
              60,939Depreciation,
                  depletion and amortization
              
              
              835,790
              
              
              
              204,183Amortization
                  of discount on note and deferred financing costs.
              
              
              676,093
              
              
              
              8,687Amortization
                  of deferred transaction charges
              
              
              -
              
              
              
              5,535Changes
                  in :Accounts
                  receivable
              
              
              757,001
              
              
              
              (1,501,180
              )Prepaid
                  assets
              
              
              112,968
              
              
              
              (448,389
              )Deferred
                  transactions charges
              
              
              (328,213
              )
              
              
              -Accounts
                  payable and accrued expenses
              
              
              (300,763
              )
              
              
              1,263,287NET
                  CASH USED IN OPERATING ACTIVITIES
              
              
              (647,649
              )
              
              
              (1,886,273
              )CASH
                  FLOWS FROM INVESTING ACTIVITIESCash
                  acquired on acquisition of EBS
              
              
              -
              
              
              
              955,774Advances
                  to EBS
              
              
              -
              
              
              
              (3,644,754
              )Proceeds
                  from sale of marketable securities
              
              
              425,000
              
              
              
              525,000Capital
                  expenditures for oil and gas properties
              
              
              (2,959,803
              )
              
              
              (2,894,142
              )NET
                  CASH USED IN INVESTING ACTIVITIES
              
              
              (2,534,803
              )
              
              
              (5,058,122
              )CASH
                  FLOWS FROM FINANCING ACTIVITIESProceeds
                  from loan - related party
              
              
              25,000,000
              
              
              
              5,210,000Proceeds
                  from sale of common stock, net
              
              
              15,795
              
              
              
              9,678,293Payments
                  on note
              
              
              (12,010,882
              )
              
              
              -NET
                  CASH PROVIDED BY FINANCING ACTIVITIES
              
              
              13,004,913
              
              
              
              14,888,293NET
                  CHANGE IN CASH
              
              
              9,822,461
              
              
              
              7,943,898CASH
                  BALANCESBeginning
                  of period
              
              
              5,003,803
              
              
              
              604,411End
                  of period
              
              $
              14,826,264
              
              
              $
              8,548,309SUPPLEMENTAL
                  CASH FLOW DISCLOSURESCash
                  paid for interest
              
              $
              385,901
              
              
              $
              -Cash
                  paid for income taxes
              
              
              -
              
              
              
              -NON
                  CASH DISCLOSURESDiscount
                  on note payable
              
              $
              269,206
              
              
              $
              182,000Change
                  in derivative liability
              
              $
              294,453
              
              
              $
              (110,932
              )Stocks
                  issued for deferred stock compensation
              
              $
              57,460
              
              
              $
              31,666Stock
                  issued for debt
              
              $
              -
              
              
              $
              20,000Asset
                  retirement  obligation incurred
              
              $
              13,016
              
              
              $
              -
 
 See
        accompanying notes to consolidated financial statements.


3
 *Index*


WESTSIDE
        ENERGY
        CORPORATION
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 (Unaudited)
 
  NOTE
        1 -
        BASIS OF PRESENTATION
 
 The
        accompanying unaudited interim financial statements of Westside Energy
        Corporation (“Westside”), have been prepared in accordance with accounting
        principles generally accepted in the United States of America and the rules
        of
        the Securities and Exchange Commission, and should be read in conjunction
        with
        the audited financial statements and notes thereto contained in Westside's
        latest annual report filed with the SEC on Form 10-KSB.  In the
        opinion of management, all adjustments, consisting of normal recurring
        adjustments, necessary for a fair presentation of financial position and
        the
        results of operations for the interim periods presented have been reflected
        herein. The results of operations for interim periods are not necessarily
        indicative of the results to be expected for the full year. Notes to the
        financial statements which would substantially duplicate the disclosure
        contained in the audited financial statements for fiscal year 2006, as reported
        in Form 10-KSB, have been omitted.
 
 The
        consolidated financial statements reflect the accounts of Westside, including
        its wholly-owned subsidiaries from March 15, 2006, the date of the acquisition
        of EBS discussed in Note 7. Significant inter-company accounts and transactions
        have been eliminated.
 
 
 NOTE
        2 -
        STOCK-BASED COMPENSATION
 
 On
        January 1, 2006, Westside adopted SFAS No. 123(R), "Share-Based Payment”. SFAS
        123(R) replaced SFAS No. 123 and supersedes APB Opinion No. 25. SFAS 123(R)
        requires all share-based payments to employees, including grants of employee
        stock options, to be recognized in the financial statements based on their
        fair
        values. The pro forma disclosures previously permitted under SFAS 123 are
        no
        longer an alternative to financial statement recognition. Westside adopted
        SFAS
        123(R) using the modified prospective method which requires the application
        of
        the accounting standard as of January 1, 2006.
 
 Prior
        to
        2006, Westside began issuing common stock to employees as compensation. Westside
        recorded as compensation expense the fair value of such shares as calculated
        pursuant to Statement of Financial Accounting Standard No. 123, Accounting
        for
        Stock-Based Compensation, recognized over the related service period. Westside
        has no option plans for its employees. Westside accounts for stock-based
        compensation issued to non-employees in accordance with the provisions of
        SFAS
        No. 123 and EITF No. 96-18, “Accounting for Equity Investments That Are Issued
        to Non-Employees for Acquiring, or in Conjunction with Selling Goods or
        Services”. For expensing purposes, the value of common stock issued to
        non-employees and consultants is determined based on the fair value of the
        services received or the fair value of the equity instruments issued, whichever
        value is more reliably measurable.
 
 
 NOTE
        3 -
        CONCENTRATION OF RISK
 
 At
        March
        31, 2007, Westside's cash in financial institutions exceeded the federally
        insured deposits limit by $14,476,264.
 
 
 NOTE
        4 -
        DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
 
 On
        March
        17, 2006, Westside entered into swap agreements in order to provide a measure
        of
        stability to Westside's cash flows due to volatile oil and gas prices and
        to
        manage the exposure to commodity price risk.
 
 SFAS
        No. 133 “Accounting for Derivative Instruments and Hedging Activities”
requires that all derivative instruments be recorded on the balance sheet
        at
        their fair value. Changes in the fair value of each derivative is recorded
        each
        period in current earnings or other comprehensive income, depending on whether
        the derivative is designated as part of a hedge transaction and, if it is,
        the
        type of hedge transaction. To make this determination, management formally
        documents the hedging relationship and its risk-management objective and
        strategy for undertaking the hedge, the hedging instrument, the item, the
        nature
        of the risk being hedged, how the hedging instrument's effectiveness in
        offsetting the hedged risk will be assessed, and a description of the method
        of
        measuring ineffectiveness. This process includes linking all derivatives
        that
        are designated as cash-flow hedges to specific cash flows associated with
        assets
        and liabilities on the balance sheet or to specific forecasted
        transactions.
 
 Westside
        also formally assesses, both at the hedge's inception and on an ongoing basis,
        whether the derivatives that are used in hedging transactions are highly
        effective in offsetting cash flows of hedged items. A derivative that is
        highly
        effective and that is designated and qualifies as a cash-flow hedgehas its changes in fair value recorded in other
        comprehensive income to the extent that the derivative is effective as a
        hedge.
        Any other changes determined to be ineffective do not qualify for cash-flow
        hedge accounting and are reported currently in earnings.
  Westside
        discontinues cash-flow hedge accounting when it is determined that the
        derivative is no longer effective in offsetting cash flows of the hedged
        item,
        the derivative expires or is sold, terminated, or exercised, the derivative
        is
        redesignated as a non-hedging instrument because it is unlikely that a
        forecasted transaction will occur, or management determines that designation
        of
        the derivative
        as a cash-flow hedge instrument is no longer appropriate. In situations in
        which
        cash-flow hedge accounting is discontinued, Westside continues to carry the
        derivative at its fair value on the balance sheet and recognizes any subsequent
        changes in its fair value in earnings.
  4
 *Index*
  When
        the
        criteria for cash-flow hedge accounting are not met, realized gains and losses
        (i.e., cash settlements) are recorded in other income and expense in the
        Statements of Operations. Similarly, changes in the fair value of the derivative
        instruments are recorded as unrealized gains or losses in the Statements
        of
        Operations. In contrast, cash settlements for derivative instruments that
        qualify for hedge accounting are recorded as additions to or reductions of
        oil
        and gas revenues while changes in fair value of cash flow hedges are recognized,
        to the extent the hedge is effective, in other comprehensive income until
        the
        hedged item is recognized in earnings.
  Based
        on
        the above, management has determined that the swaps qualify for cash-flow
        hedge
        accounting treatment. For the period ended March 31, 2007, Westside recognized
        a
        derivative liability of $183,521 with the change in fair value reflected
        in
        accumulated comprehensive loss.
   NOTE
        5 –
LONG TERM DEBT – RELATED PARTY
 
 On
        March
        27, 2007, Westside closed a $25 million senior secured loan from four entities
        managed by Wellington Management Company, LLP to replace the credit facility
        previously provided by GasRock Capital, LLC.  Two of the lending
        entities are among the largest institutional holders of the Company’s
        outstanding shares.
 
 As
        a
        result of this new loan agreement all previously deferred financing costs
        and
        original issue discounts associated with the loan provided by Gas Rock Capital,
        LLC of $670,231 have been recorded in the current period as a component of
        interest expense.
 
 The
        new
        loan arrangement was provided by four private investment funds managed by
        Wellington Management, LLC, the largest beneficial holder of our outstanding
        common stock. The new loan arrangement:
 
 ·
              provided
                  $25 million in funds, which were advanced in their entirety upon
                  completion of the new loan
                  arrangement;
 ·
              is
                  secured by a first lien on all of the oil and gas properties comprising
                  our Southeast and Southwest
                  Programs;
 ·
              grants
                  to the lenders the right to receive a lien in any and all of the
                  proceeds
                  received upon the sale of a property comprising our North Program
                  or any
                  subsequent property acquired with such
                  proceeds;
 ·
              bears
                  annual interest at 10.0%, or (in the case of default) 12.0%
                  annually;
 ·
              grants
                  to the lenders a three percent (3.0%) overriding royalty interest
                  (proportionately reduced to our working interest) in all oil and
                  gas
                  produced from the properties now comprising our Southeast and Southwest
                  Programs;
 ·
              contains
                  limiting operating covenants;
 ·
              contains
                  events of default arising from failure to timely repay principal
                  and
                  interest or comply with certain covenants;
                  and
 ·
              requires
                  the repayment of the outstanding balance of the loan in March
                  2009.
 
 Westside
        has recorded a discount of $271,861 related to the conveyance of the overriding
        royalty interest discussed above. As of March 31, 2007, $2,655 of this discount
        has been amortized as a component of interest expense. Westside incurred
        fees
        and other costs directly associated with this loan agreement of $328,213,
        These
        fees have been recorded as deferred financing costs. As of March 31, 2007,
        $3,206 of these deferred financing costs has been amortized as a component
        of
        interest expense. Both the discount and deferred financing costs are being
        amortized over the expected term of the note using the effective interest
        method.
 
 Westside
        analyzed these instruments for derivative accounting consideration under
        SFAS
        133 and EITF 00−19 and determined that derivative accounting is not
        applicable.
 
 
 NOTE
        6 –
EQUITY
 
 Westside
        had the following equity transactions for the three-month period ended March
        31,
        2007:
 
 ·
              10,000
                  warrants were exercised for proceeds of
                  $5,000.
 ·
              7,950
                  shares of common stock were issued for current and future services
                  to be
                  earned evenly over the next three years.  Westside recognized
                  $76,863 in expenses during the first quarter for the amortization
                  of
                  shares issued for future
                  compensation.
 ·
              An
                  employee who had previously been issued shares resigned form Westside
                  resulting in the cancellation 13,333 shares previously issued for
                  future
                  services.
  5
 *Index*
  NOTE
        7 -
        PURCHASE OF EBS OIL AND GAS PARTNERS PRODUCTION COMPANY, L.P.
 
 On
        March
        15, 2006, Westside acquired EBS Oil and Gas Partners Production Company,
        L.P.
        and EBS Oil and Gas Partners Operating Company, L.P. (collectively "EBS").
        The
        acquired EBS assets consist (in part) of rights in approximately 9,837 gross
        acres and an approximately one-sixth interest in Tri-County Gathering, a
        pipeline system serving part of the Barnett Shale area. The interest in the
        pipeline system was sold in November 2006 for $5,000,000.
 
 The
        purchase price for the Equity Interests consisted of an initial purchase
        price
        paid at closing (the "Initial Purchase Price") and additional consideration
        to
        be paid after closing (the "Additional Consideration"). The Initial Purchase
        Price was set at $9,804,839, subject to certain adjustments. The adjustments
        included a reduction in the Initial Purchase Price for all debt owed by EBS,
        including (a) indebtedness in the approximate amount of $5,850,000 owed by
        EBS
        to Westside, and (b) indebtedness in the approximate amount of $1,600,000
        owed
        by EBS to a third party. After making adjustments, Westside paid in cash
        at the
        closing approximately $151,000 to the Class B partners of EBS and an EBS
        payable
        in the amount of approximately $294,000, and Westside received a credit in
        the
        approximate amount of $1,700,000 against the future payment of the Additional
        Consideration. Funding for the cash paid at the closing and the retirement
        of
        the Third Party Loan was provided from Westside's available cash and by GasRock
        Capital LLC ("GasRock") pursuant to an Advancing Term Credit Agreement (the
        "Credit Agreement"). The additional consideration was resolved and finalized
        in
        2006.
 
 
 The
        following unaudited pro forma information assumes the acquisition of EBS
        occurred as of January 1, 2006. The pro forma results are not necessarily
        indicative of what actually would have occurred had the acquisition been
        in
        effect for the period presented.
 
 Three
        month period ended March 31, 2006:
 
 **As**
                **Reported**
              
              
              **Pro-**
                **Forma**Revenues
              
              $
              352,401
              
              
              $
              1,021,222Net
                  Loss
              
              $
              (1,479,335
              )
              
              $
              (1,519,191
              )Loss
                  Per Share
              
              $
              (0.07
              )
              
              $
              (0.07
              )


6
 *Index*





**ITEM
      2.   MANAGEMENT’S DISCUSSION AND
      ANALYSIS**





**General**





Westside
      Energy Corporation is an independent natural gas and oil exploration and
      production company based in Dallas, Texas with operations in the Barnett Shale
      in the Fort Worth Basin located in north central Texas.  We have been
      successful in identifying and acquiring acreage positions where vertical and
      horizontal drilling, advanced fracture stimulation and enhanced recovery
      technologies create the possibility of economically developing and producing
      natural gas and oil reserves from the Barnett Shale. We have assembled a
      portfolio of large, predominantly undeveloped leasehold interests in the Barnett
      Shale, which we believe positions us for significant long-term growth in proved
      natural gas and oil reserves and production.  As of March 31, 2007, we
      owned natural gas and oil leasehold interests in approximately 76,733 gross
      (67,184 net) acres, approximately 96% of which are undeveloped. In addition,
      we
      owned working interests in 45 gross (15 net) wells in the Barnett
      Shale.  We incorporated under Nevada law in November 1995 as "Eventemp
      Corporation," a company with activities related to the automotive
      industry.  Following several years of business inactivity, we entered
      the natural gas and oil industry in February 2004 and in the following month
      changed our name to "Westside Energy Corporation."  There can be no
      assurance that we will be successful in our exploration, development and
      production activities.  The oil and gas business involves numerous
      risks, the principal ones of which are described in the section captioned "RISK
      FACTORS" in our Annual Report on Form 10-KSB for the year ended December 31,
      2006.





Listed
      below are key Company events that have occurred in 2007 to date:





*
            We
                completed our first horizontal Hill County well, the Primula #1H
                well, in
                which we own a 50% interest.  This well tested at a gross
                initial rate of 2.1 million cubic feet per day from its 1,600' productive
                horizontal section.





*
            We
                spud our second horizontal well in Hill County, the Ellison Estate
                #1H, in
                which we own a 50% interest.  This well was recently fracture
                stimulated and is currently flowing back natural gas and completion
                fluids.





*
            The
                Fortenberry #2H horizontal well, in which we own a 37.5% interest,
                reached
                its target depth and was cased.   This well was recently
                completed and is currently flowing back completion fluids and hydrocarbons
                at a rate of 982 MCF/D and 82 BO/D on a 33/64-inch
                choke.





*
            We
                entered into a new loan arrangement to replace our existing credit
                facility provided by GasRock Capital LLC.  The new loan
                arrangement was provided by four private investment funds managed
                by
                Wellington Management, LLC, the largest beneficial holder of our
                outstanding common stock.  For more information about this loan
                arrangement, see the subsection captioned “Liquidity and Capital
                Resources” below.





*
            We
                finalized our 2007 project budget in the amount of $15
                million.  This budget, primarily for activities in Hill County,
                is allocated as follows ($
                millions):





Drilling:
            $12
            
            for
                8 gross / 4 net wells.Leasehold:
            2
            
            for
                acreage additions and renewals.Seismic:
            1
            
            for
                3-D data over 12,000 gross acres.Total:
            $15





7
 *Index*





The
      following discussion and analysis of our financial condition and results of
      operations should be read in conjunction with our consolidated financial
      statements and related notes included elsewhere in this Report. In addition
      to
      historical information, the discussion in this Report contains forward-looking
      statements that involve risks and uncertainties. Actual results could differ
      materially from those anticipated by these forward-looking statements due to
      factors including, but not limited to, those factors set forth elsewhere in
      this
      Report and in the section captioned "RISK FACTORS" in our Annual Report on
      Form
      10-KSB for the year ended December 31, 2006.





**Results
      of Operations**





Financial
      results for the three-month period ended March 31, 2007 are not directly
      comparable to financial results for the three-month period ended March 31,
      2006.   The completion of the EBS acquisition near the end of the
      first quarter of 2006 did not greatly affect the financial results for that
      quarter, but did greatly affected the financial results for subsequent quarters,
      including the first quarter of 2007.





*Quarter
      Ended March 31, 2007 Compared to the Quarter Ended March 31,
      2006*





*Revenues.*******Revenues
      from sales of oil and natural gas were $915,227 in the first quarter of 2007
      as
      compared to $352,401 in the first quarter of 2006.  This increase in
      revenues reflects the impact of higher sales volumes and prices for both oil
      and
      gas.  Oil sales volumes increased from an average of 27 to 43 barrels
      per day, and average oil sales prices increased from $60.00 to $60.97 per
      barrel.  Natural gas sales increased from an average of 466 to 1,230
      thousand cubic feet (MCF) per day while average natural gas sales prices
      increased from $5.60 to $6.15 per MCF.





*Expenses.*******Operating
      expenses increased to $2,355,890 in the first quarter of 2007 from $1,867,797
      for the first quarter of 2006.  This significant increase reflects the
      impact on expenses of higher oil and gas sales volumes in the first quarter
      of
      2007 and increases in staff after the first quarter of
      2006.  Production expenses were $498,015 in the first quarter of 2007
      as compared to $250,268 in the first quarter of 2006, reflecting increased
      production operations activities associated with the substantial increase in
      sales volumes as well as higher oil and gas severance taxes due to both higher
      volumes and prices.  General and administrative expenses decreased to
      $1,016,224 in the first quarter of 2007 from $1,442,402 in the first quarter
      of
      2006 primarily as a result of lower stock compensation expenses.





*Depreciation,
      Depletion and Amortization.*******Depreciation,
      depletion and amortization costs increased to $841,651 in the first quarter
      of
      2007 from $175,062 in the first quarter of 2006, reflecting the impact of the
      substantial increase in volumes of oil and natural gas produced and sold and
      the
      expensing of capitalized costs on a units-of-production basis.





*Operating
      Loss.*******As a result of the above described
      revenues and expenses, we incurred an operating loss of $1,440,663 in the first
      quarter of 2007 as compared to an operating loss of $1,515,396 in the first
      quarter of 2006.





*Other
      Income (Expense).*Other income and expense items in the first
      quarter of 2007 included $30,203 in interest income and $1,056,133 in interest
      expense.  The first quarter of 2006 results included $76,854 in
      interest income and $40,793 in interest expense.****Interest
      expense increased in 2007 as a result of borrowings under the GasRock and
      Wellington credit facilities.





*Net
      Loss.*We incurred a net loss of $2,466,593, or $0.11 per share,
      for the quarter ended March 31, 2007 as compared to a net loss of $1,479,335,
      or
      $0.07 per share, for the quarter ended March 31, 2006.





8
 *Index*





**Liquidity
      and Capital Resources**





*Cash
      and Cash Equivalents*. As of March 31, 2007, we had cash, cash equivalents
      and marketable securities of approximately $14.9 million, representing an
      increase of $9.4 million from March 31, 2006.





*Hedging*.
      Under our senior secured credit facility, we were required to hedge a
      substantial portion of our reserves. In March 2006, we entered into swap
      contracts covering approximately 75% of our projected production through March
      2008 from our proved developed producing reserves estimated as of December
      31,
      2005 based on a report prepared by LaRoche Petroleum Consultants, Ltd., a
      third-party engineering firm. The prices stated in the swap contracts were
      $8.05
      per MMBtu for natural gas and $66.15 per barrel for oil. In the first quarter
      of
      2007, we added additional hedge positons, extending from February 2007 to
      December 2008. The prices stated in these swap contracts was $7.45 per MMBtu
      of
      natural gas and $55.50 per barrel of oil.





*Senior
      Secured Financing*. In March 2006, we entered into a $45 million senior
      secured revolving credit facility with GasRock Capital LLC (“GasRock”). In
      connection with our acquisition of EBS Oil and Gas Partners Production Company
      L.P. and its affiliated operations company, we borrowed approximately $5.3
      million under the GasRock credit facility for payments at closing, approximately
      $1.6 million to discharge certain of the acquired companies' indebtedness,
      and
      amounts for reimbursement of costs related to previous drilling and future
      development drilling. Subsequently, we borrowed an additional amount of
      approximately $10 million under the GasRock credit facility. During March 2007,
      we entered into a new loan arrangement to replace the GasRock facility, which
      was paid off and terminated. The new loan arrangement was provided by four
      private investment funds managed by Wellington Management, LLC, the largest
      beneficial holder of our outstanding common stock. The new loan
      arrangement:





*
            provided
                $25 million in funds, which were advanced in their entirety upon
                completion of the new loan
                arrangement;


*
            is
                secured by a first lien on all of the oil and gas properties comprising
                our Southeast and Southwest
                Programs;


*
            grants
                to the lenders the right to receive a lien in any and all of the
                proceeds
                received upon the sale of a property comprising our North Program
                or any
                subsequent property acquired with such
                proceeds;


*
            bears
                annual interest at 10.0%, or (in the case of default) 12.0%
                annually;


*
            grants
                to the lenders a three percent (3.0%) overriding royalty interest
                (proportionately reduced to our working interest) in all oil and
                gas
                produced from the properties now comprising our Southeast and Southwest
                Programs;


*
            contains
                limiting operating covenants;


*
            contains
                events of default arising from failure to timely repay principal
                and
                interest or comply with certain covenants;
                and


*
            requires
                the repayment of the outstanding balance of the loan in March
                2009.





We
      continually evaluate our capital needs and compare them to our capital
      resources. Our budgeted project expenditures for 2007 are approximately $15.0
      million and are to be used primarily for drilling and development of our
      properties. We expect to fund these expenditures from available cash and revenue
      generated during 2007 and, if necessary, from additional borrowings. The level
      of project expenditures is largely discretionary and the amount of funds devoted
      to any activity may increase or decrease depending on available opportunities,
      commodity prices, cash flows, development results and other
      considerations.





9
 *Index*





We
      believe that our available cash and access to additional borrowings will be
      sufficient to enable us to pursue our business plans for the next 12
      months.





**Critical
      Accounting Policies and Estimates**





Our
      discussion of our financial condition and results of operations is based on
      the
      information reported in our financial statements. The preparation of our
      financial statements requires us to make assumptions and estimates that affect
      the reported amounts of assets, liabilities, revenues and expenses as well
      as
      the disclosure of contingent assets and liabilities as of the date of our
      financial statements. We base our assumptions and estimates on historical
      experience and other sources that we believe to be reasonable at the time.
      Actual results may vary from our estimates due to changes in circumstances,
      weather, politics, global economics, mechanical problems, general business
      conditions and other factors. Our significant accounting policies are detailed
      in the footnotes to our financial statements included in this Quarterly Report.
      We have outlined below certain of these policies that have particular importance
      to the reporting of our financial condition and results of operations and that
      require the application of significant judgment by our management.





***Key
      Definitions - Proved Oil and Natural Gas Reserves***





Proved
      reserves, as defined by the SEC, are the estimated quantities of crude oil,
      condensate, natural gas and natural gas liquids that geological and engineering
      data demonstrate with reasonable certainty are recoverable in future years
      from
      known reservoirs under existing economic and operating conditions. Valuations
      include consideration of changes in existing prices provided only by contractual
      arrangements, but not on escalations based upon future conditions. Prices do
      not
      include the effect of derivative instruments, if any, entered into by
      us.





Proved
      developed reserves are those reserves expected to be recovered through existing
      equipment and operating methods. Additional oil and gas volumes expected to
      be
      obtained through the application of fluid injection or other improved recovery
      techniques for supplementing the natural forces and mechanisms of primary
      recovery are included as proved developed reserves only after testing of a
      pilot
      project or after the operation of an installed program has confirmed through
      production response that increased recovery will be achieved.





Proved
      undeveloped reserves are those reserves that are expected to be recovered from
      new wells on non-drilled acreage, or from existing wells where a relatively
      major expenditure is required for re-completion. Reserves on non-drilled acreage
      are limited to those drilling units offsetting productive units that are
      reasonably certain of production when drilled. Proved reserves for other
      non-drilled units are claimed only where it can be demonstrated with certainty
      that there is continuity of production from the existing productive
      formation.





***Estimation
      of Reserves***





Volumes
      of reserves are estimates that, by their nature, are subject to revision. The
      estimates are made using all available geological and reservoir data as well
      as
      production performance data. There are numerous uncertainties in estimating
      crude oil and natural gas reserve quantities, projecting future production
      rates
      and projecting the timing of future development expenditures. Natural gas and
      oil reserve engineering must be recognized as a subjective process of estimating
      underground accumulations of natural gas and oil that cannot be measured in
      an
      exact way. Estimates of independent engineers that we use may differ from those
      of other engineers. The accuracy of any reserve estimate is a function of the
      quantity and quality of available data and of engineering and geological
      interpretation and judgment. Accordingly, future estimates are subject to change
      as additional information becomes available.





10
 *Index*





***Revenue
      Recognition***





We
      record
      natural gas and oil revenues using the entitlement method of accounting for
      production, in which any excess amount received by us above our share of
      production is treated as a liability. If we receive less than our share of
      production, the underproduction is recorded as an asset. We did not have an
      imbalance position relative to volumes or values at March 31, 2007.





***Successful
      Efforts Accounting***





We
      utilize the successful efforts method to account for our natural gas and oil
      operations. Under this method, all costs associated with natural gas and oil
      lease acquisitions, successful exploratory wells and all development wells
      are
      capitalized and amortized on a unit-of-production basis over the remaining
      life
      of proved developed reserves and proved reserves on a lease basis. Unproved
      leasehold costs are capitalized pending the results of exploration efforts.
      Exploration costs, including geological and geophysical expenses, exploratory
      dry holes and delay rentals, are expensed when incurred.





***Impairment
      of Properties***





We
      review
      our proved properties for potential impairment at the lease level when
      management determines that events or circumstances indicate that the recorded
      carrying value of any of the properties may not be recoverable. Such events
      include a projection of future natural gas and oil reserves that will be
      produced from a lease, the timing of this future production, future costs to
      produce the natural gas and oil, and future inflation levels. If the carrying
      amount of an asset exceeds the sum of the undiscounted estimated future net
      cash
      flows, we recognize impairment expense equal to the difference between the
      carrying value and the fair market value of the asset, which is estimated to
      be
      the expected present value of future net cash flows from proved reserves,
      without the application of any estimate of risk. We cannot predict the amount
      of
      impairment charges that may be recorded in the future. Unproved leasehold costs
      are reviewed periodically and a loss is recognized to the extent, if any, that
      the cost of a property has been impaired.





***Stock-Based
      Compensation***





Compensation
      expense has been recorded for common stock grants based on the fair value of
      the
      common stock on the measurement date. Statement of Financial Accounting
      Standards No. 123R, "Share-Based Payments," or "SFAS No. 123R," establishes
      standards for accounting for transactions in which an entity exchanges its
      equity instruments for goods and services. SFAS No. 123R focuses primarily
      on
      accounting for transactions in which an entity obtains employee services in
      share-based payment transactions. SFAS No. 123R requires that the fair value
      of
      such equity instruments be recognized as expense in the historical financial
      statements as services are performed. SFAS No. 123R was effective for us as
      of
      the beginning of 2006 and has had no impact on our financial statements, because
      the only equity compensation that we have previously made is in the form of
      grants of common stock, which are recorded at fair value.





**Forward-Looking
      Statements**





Statements
      in the preceding discussion relating to future plans, projections, events,
      or
      conditions are forward-looking statements.  Actual results, including
      production growth and capital spending, could differ materially due to changes
      in long-term oil or gas prices or other changes in market conditions affecting
      the oil and gas industry; political events or disturbances; severe weather
      events; reservoir performance; changes in OPEC quotas; timely completion of
      development projects; changes in technical or operating conditions; and other
      factors including those discussed herein and in the section captioned "RISK
      FACTORS" in our Annual Report on Form 10-KSB for the year ended December 31,
      2006.





11
 *Index*




**ITEM
      3.  CONTROLS AND PROCEDURES**





We
      conducted an evaluation, under the supervision and with the participation of
      the
      Chief Executive Officer and Chief Financial Officer, of the effectiveness of
      our
      disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
      under the Securities Exchange Act of 1934 as amended (the "Exchange Act")).
      Based on this evaluation, the Chief Executive Officer and Chief Financial
      Officer concluded that our disclosure controls and procedures as of the end
      of
      the fiscal quarter covered by this Quarterly Report on Form 10-QSB were
      effective at a reasonable assurance level to ensure that information required
      to
      be disclosed by us in reports that we file or submit under the Exchange Act
      is
      recorded, processed, summarized and reported within the time periods specified
      in Securities and Exchange Commission rules and forms.  Our internal
      controls over financial reporting (as defined in Rule 13a-15(f) or Rule
      15d-15(f) under the Exchange Act) have improved significantly during the last
      two years. The improvements include the expansion of the Board of Director's
      on
      March 31, 2005 to include three independent directors, each of whom was
      appointed a member of the Audit Committee, and the addition to staff of a Chief
      Financial Officer/Principal Accounting Officer and a Controller. Systems
      improvements include the installation of a more robust accounting system
      specifically designed to meet the needs of an oil and gas company. The Audit
      Committee members were actively involved in reviews of the financial statements
      for each of the quarters since March 2005. The Chairman of the Audit Committee
      met with our independent auditors in May 2005, and the independent auditors
      met
      with the full Audit Committee on March 28, 2006 and March 29, 2007. The addition
      of a Chief Financial Officer has allowed us to enhance controls over the
      authorization, recording, processing and reporting of transactions. Additional
      accounting staff, including a Controller, joined us as a result of the EBS
      transaction, enhancing our ability to segregate duties and improve our internal
      controls. Management does not expect that our disclosure controls and procedures
      will prevent or detect all errors or fraud. Any control system, no matter how
      well designed and operated, is based upon certain assumptions and can provide
      only reasonable, but not absolute, assurance that its objectives will be met.
      Further, no evaluation of controls can provide absolute assurance that
      misstatements due to error or fraud will not occur.





**PART
      II. OTHER INFORMATION**





**ITEM
      1.  LEGAL PROCEEDINGS**





We
      are
      not now a party to any legal proceeding requiring disclosure in accordance
      with
      the rules of the U.S. Securities and Exchange Commission.  In the
      future, we may become involved in various legal proceedings from time to time,
      either as a plaintiff or as a defendant, and either in or outside the normal
      course of business.  We are not now in a position to determine when
      (if ever) such a legal proceeding may arise. If we ever become involved in
      a
      legal proceeding, our financial condition, operations, or cash flows could
      be
      materially and adversely affected, depending on the facts and circumstances
      relating to such proceeding.





**ITEM
      2.  UNREGISTERED SALES OF EQUITY SECURITIES AND
      USE OF PROCEEDS.**





During
      March 2007, a stockholder of ours exercised warrants issued during the second
      quarter of 2004 to purchase 10,000 shares of our common stock at a per-share
      price of $.50. The issuance of the common stock is claimed to be exempt pursuant
      to Rule 506 of Regulation D under the Securities Act of 1933 (the "Act"). No
      advertising or general solicitation was employed in offering these securities.
      The offering and sale were made only to an accredited investor, and subsequent
      transfers were restricted in accordance with the requirements of the
      Act.





12
 *Index*





**ITEM
      6.     EXHIBITS**





(a)           The
      following exhibits are filed with this Quarterly Report or are incorporated
      herein by reference:





Exhibit


Number   Description





23.01
            Consent
                of LaRoche Petroleum Consultants,
                Ltd.


31.01
            Certification
                pursuant to Rule 13a-14(a) of the Securities Exchange Act of
                1934.


31.02
            Certification
                pursuant to Rule 13a-14(a) of the Securities Exchange Act of
                1934.


32.01
            Certification
                Pursuant to 18 U.S.C. Section 1350, as pursuant to Section 906 of
                the
                Sarbanes-Oxley Act of 2002.


32.02
            Certification
                Pursuant to 18 U.S.C. Section 1350, as pursuant to Section 906 of
                the
                Sarbanes-Oxley Act of 2002.





**SIGNATURE**





In
      accordance with the requirements of the Exchange Act, the Registrant has duly
      caused this Report to be signed on its behalf by the undersigned, thereunto
      duly
      authorized.




WESTSIDE
                  ENERGY CORPORATION(Registrant)By:
              /s/
                  Douglas G. MannerDouglas
                  G. Manner,Chief
                  Executive Officer(Principal
                  Executive Officer)By:
              /s/
                  Sean J. AustinSean
                  J. Austin,Vice
                  President and Chief Financial Officer(Principal
                  Financial Officer and Principal Accounting
                  Officer)


May
      21,
      2007






13