UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION






Washington, D.C.
20549




FORM
10-K






þ ANNUAL REPORT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934






For the fiscal year
ended November 30,
2008






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 000-53447






MASS
Petroleum Inc.


(Exact name of
registrant as specified in its charter)




NEVADA
            
            20-5893809(State or
      Other Jurisdiction of Incorporation of Organization)
            
            (I.R.S.
      Employer Identification No.)








Suite
507-700 West Pender Street
 Vancouver,
British Columbia, V6C 1G8
 (Address of
principal executive offices)


(604) 662
3910


(Registrant’s
telephone number, including area code)




Securities
registered under Section 12(b) of the Exchange Act: None


Securities
registered under Section 12(g) of the Exchange Act: Common
Stock, $0.0001 par value





Indicate by check
mark if the registrant is a well-known seasoned issuer, as defined in Rule 405
of the Securities Act. Yes o   Noþ





Indicate by check
mark if the registrant is not required to file reports pursuant to Section 13 or
Section 15(d) of the Act.  Yes o   Noþ





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. Yesþ   No
o





Indicate by check
mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
(§ 229.405 of this chapter) is not contained herein, and will not be contained,
to the best of registrant’s knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. þ





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





Large accelerated
filer o           Accelerated
filer o        Non-accelerated
filer o      Smaller reporting companyþ





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





Aggregate market
value of the voting and non-voting stock of the registrant held by
non-affiliates of the registrant as of May 31, 2008:$47,336,000(Non-affiliate
holdings of 29,585,000 common shares, closing price of $1.60).





As
of March 17, 2009the
registrant’s outstanding stock consisted of 81,088,000 common
shares.














MASS
PETROLEUM INC.






TABLE
OF CONTENTS




Part I
 Item 1 Description
of Business Item 1A Risk Factors
 Item 1B Unresolved
Staff Comments
 Item 2
Properties
 Item 3 Legal
Proceedings Item 4 Submission of Matters to a Vote of Security
Holders
  Part
II
 Item 5 Market for
Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities Item 7 Management’s Discussion and Analysis of Financial
Condition and Results of Operation
 Item 8 Financial
Statements and Supplementary Data
 Item 9 Changes In
and Disagreements with Accountants on Accounting and Financial
Disclosure
 Item 9A Controls
and Procedures Item 9B Other
Information
  PART  III
 Item 10 Directors,
Executive Officers and Corporate GovernanceItem 11 Executive Compensation Item
12 Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters Item 13 Certain Relationships and Related Transactions and
Director IndependenceItem  14 Principal Accountant Fees and
Services
  PART IV
 Item 15 Exhibits,
Financial Statement Schedules




2




PART
I





Item
1. Description of Business




Forward-looking
Statements




This annual report
contains forward-looking statements. These statements relate to future events or
our future financial performance. In some cases, you can identify
forward-looking statements by terminology such as "may", "will", "should",
"expects", "plans", "anticipates", "believes", "estimates", "predicts",
"potential" or "continue" or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown
risks, uncertainties and other factors that may cause our or our industry's
actual results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking
statements.




Although we believe
that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable laws, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements so as to conform these statements to actual results.




As
used in this annual report, the terms "we", "us", "our", “the Company”, and
"MASS" mean MASS Petroleum Inc., unless otherwise indicated.




All dollar amounts
refer to US dollars unless otherwise indicated.




Overview




We
are a start up oil and gas exploration company. We were incorporated in the
State of Nevada on February 14, 2006, under the name “XTOL Energy Inc.” We
operated under this name until October 10, 2007, and then changed our name to
LAUD Resources Inc.  On June 23, 2008 we changed our name to MASS
Petroleum Inc. and on July 11, 2008 we received a new symbol for the quotation
of our common stock on the OTC Bulletin Board, “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) 662-3910.  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 $13,098
from our 2.34% non operated interest in three operating wells in Oklahoma from
the time we acquired our interest on August 1, 2006 to November 30,
2008.





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 interest from producing oil wells with the
higher risk development of oil and gas exploration projects. For the next twelve
months (beginning December 2008), we plan to purchase additional operated and
non-operated interests in producing oil and natural gas properties, to acquire
additional development stage exploration properties and to carry out an
exploration program on the acquired properties.  We are not involved
in any bankruptcy, receivership or similar proceedings.




3




Business
Developments





During our fiscal
year ended November 30, 2008, the following developments occurred:





·
            On February
      5, 2008 we declared a stock dividend in the amount of $0.000001 per share
      to each of our shareholders of record as of February 5, 2008 (being
      81,088,000 common shares issued and outstanding). The dividend was payable
      in fully paid and non-assessable common shares of APIC Resources Inc.,
      effectively resulting in the issuance of 1 common share of APIC for every
      100 of our common shares owned. In connection with our dividend
      declaration, our holdings of 100 common shares of APIC Resources Inc. were
      cancelled.


·
            On June 9,
      2008 we appointed Vitaly Melnikov as our Chief Financing Officer and
      accepted the resignation of Jordan Shapiro from the position effective
      immediately. Jordan Shapiro continues to act as our
    Secretary.


·
            On June 17,
      2008 we appointed Vitaly Melnikov and Oleg Bilinsky as our directors, with
      Mr. Bilinsky being appointed as the Chairman of our Board of Directors. We
      increased the number of directors serving on our board of directors to
      four.


·
            On June 24,
      2008 we appointed Oleg Bilinski as our President and Chief Executive
      Officer, and accepted Gary Chayko’s resignation from these positions. Mr.
      Chayko also resigned his position as our director, reducing the number of
      our directors to three.


·
            On October 6,
      2008 we filed a registration statement with the SEC registering our common
      shares pursuant to section 12(g) of the Exchange
  Act.


·
            On October
      15, 2008 we granted Vitaly Melnikov options to purchase 500,000 of our
      common shares at an exercise price of $1.50 per share, with vesting dates
      ranging from December 6, 2008 to June 6, 2010 and with expiry dates
      ranging from December 5, 2010 to June 5,
2012.




On
May 19, 2008 we entered into a share exchange agreement and addendum with
Uraltransneft Co. Ltd., a Russian corporation, and its selling shareholders,
Igor Alexeevich Kuznetsov, Valeriy Volegov, and Yuriy
Krylov.  Pursuant to the agreement we have agreed to issue 41,100,000
common shares of our capital stock to the selling shareholders in exchange for
all outstanding shares of Uraltransneft. Closing of the agreement may take place
on a date to be mutually determined by the parties and is subject to the
satisfaction of certain conditions precedent including:






·
            Acquisition
      by Uraltransneft of a target corporation whose assets include full oil
      extraction infrastructure, transport equipment, pipeline, and wells
      producing 2,000 barrels of oil per day with at least 7,500,000 barrels of
      oil in reserves.




·
            Satisfactory
      completion of due diligence by us of certain oilfields confirming the
      presence of not less than 15,000,000 barrels of oil reserves, and
      assignment by Uraltransneft to us of an option agreement to purchase a
      100% interest in those oilfields.




·
            Surrender for
      cancellation by Mr. Jordan Shapiro, Hudson Capital Corp. and Mr. Gary
      Chayko of a total of 40,088,000 common shares and 20,000,000 options to
      purchase common shares in our capital
stock.




·
            Satisfactory
      completion of customary due diligence by us and
    Uraltransneft.






Following closing,
we have agreed to provide $6,000,000 in financing to Uraltransneft in four
installments of $1,500,000 each payable within 7 days, three months, six months,
and 12 months following closing. Additionally, we have the non-exclusive option
to arrange a best efforts financing of up to $13,500,000 to be used for the
purchases of three companies from Uraltransneft for $11,500,000 and $2,000,000
that hold oil extraction licenses from six oilfields located in Perm Krai,
Russia. This purchase is subject to our satisfactory review of a detailed
budget, to be prepared Uraltransneft and provided to us within seven days after
we have acquired the oilfields under the non-exclusive option. Within ten days
of closing the share exchange agreement, Uraltranseft will provide us with a
purchase agreement by which we may exercise the option if we so
choose.




If
we fail to provide $6,000,000 in financing to Uraltransneft within 12 months of
the closing, either party may terminate the share exchange agreement upon
providing notice to the other party. Upon such termination, all transactions and
cancellations of shares and options pursuant to the agreement will be reversed
and Uraltransneft will be returned to its original shareholders. In the event of
termination, Uraltransneft will not have any obligation to return any financing
it receives pursuant to the agreement.




Closing of the
agreement will result in Uraltransneft becoming our wholly owned subsidiary.
Additionally, the three selling shareholders of Uraltransneft will each hold
approximately 13,700,000 common shares (the equivalent of 16.8%) of our issued
and outstanding common stock.




Uraltransfneft Co.
Ltd. 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. There is no
material relationship between us and Uraltransneft or the selling shareholders
other than the material agreement entered into.




As of March 17,
2009 we have not been able to raise the required funds to close the agreement
with Uraltransfneft and our management believes the likelihood of closing the
agreement is uncertain.  We will continue with our efforts to complete
this transaction until our board of directors concludes that it is no longer in
our best interest to do so or our contractual rights expire.




4




Future Oil and Gas
Interests





In
conjunction with our efforts to complete the transaction for the acquisition of
Uraltransneft we are also searching for oil and gas leases or interests in
leases in small and medium-sized oil and natural gas production companies and
properties. For our initial acquisitions, we are looking for low risk property
interests. During the 12 months beginning April 2009, we intend to include in
our portfolio additional non-operated interests in producing wells as well as an
exploration interest in a development stage oil and gas property.  As
we continue the development of our portfolio of interests, we will be looking
for properties and interests that have the following qualities:





·
            at least
      developmental drilling in proven producing areas;


·
            significant
      additional production capacity through developmental drilling,
      recompletions and workovers;


·
            further
      developmental potential; and


·
            in some
      cases, ability to assume operatorship or appointment of a known operator
      with relevant experience in the
area.




Markets





We
are currently in the exploration stage and we have generated only nominal
revenues. We are not producing oil or gas and we have no
customers.  We only have a non-operated working interest in three
wells in Oklahoma at this time.  The availability of a ready market
and the prices obtained for oil and gas produced depend on many factors,
including the extent of domestic production and imports of oil and gas, the
proximity and capacity of natural gas pipelines and other transportation
facilities, fluctuating demand for oil and gas, the marketing of competitive
fuels, and the effects of governmental regulation of oil and gas production and
sales.





A
ready market exists for domestic oil and gas through existing pipelines and
transportation of liquid products. Whether an international market exists
depends upon the existence of international delivery systems and on political
and pricing factors.





If
we are successful in producing oil and gas in the future, we expect our future
customers for our oil and gas to be refiners, remarketers and third party
intermediaries, who either have, or have access to, consumer delivery systems.
We intend to sell our oil and gas under both short-term (less than one year) and
long-term (one year or more) agreements at prices negotiated with third parties.
Typically either the entire contract (in the case of short-term contracts) or
the price provisions of the contract (in the case of long-term contracts) are
renegotiated at intervals ranging in frequency from daily to annually. We have
not yet adopted any specific sales and marketing plans. However, as we purchase
future properties, the need to hire marketing personnel will be
addressed.




Competition





The oil and gas
industry is highly competitive. We are a new exploration stage company and have
a weak competitive position in the industry. We compete with junior and senior
oil and gas companies, independent producers and institutional and individual
investors who are actively seeking to acquire oil and gas properties throughout
the world together with the equipment, labor and materials required to operate
on those properties. Competition for the acquisition of oil and gas interests is
intense with many oil and gas leases or concessions available in a competitive
bidding process in which we may lack the technological information or expertise
available to other bidders.





Many of the oil and
gas companies with which we compete for financing and for the acquisition of oil
and gas properties have greater financial and technical resources than those
available to us. Accordingly, these competitors may be able to spend greater
amounts on acquiring oil and gas interests of merit or on exploring or
developing their oil and gas properties. This advantage could enable our
competitors to acquire oil and gas properties of greater quality and interest to
prospective investors who may choose to finance their additional exploration and
development. Such competition could adversely impact our ability to attain the
financing necessary for us to acquire further oil and gas interests or explore
and develop our current or future oil and gas properties.





We
also compete with other junior oil and gas companies for financing from a
limited number of investors that are prepared to invest in such companies. The
presence of competing junior oil and gas companies may impact our ability to
raise additional capital in order to fund our acquisition or exploration
programs if investors perceive that investments in our competitors are more
attractive based on the merit of their oil and gas properties or the price of
the investment opportunity. In addition, we compete with both junior and senior
oil and gas companies for available resources, including, but not limited to,
professional geologists, land specialists, engineers, camp staff, helicopters,
float planes, oil and gas exploration supplies and drill rigs.





General competitive
conditions may be substantially affected by various forms of energy legislation
and/or regulation introduced from time to time by the governments of the United
States and other countries, as well as factors beyond our control, including
international political conditions, overall levels of supply and demand for oil
and gas, and the markets for synthetic fuels and alternative energy
sources.





In
the face of competition, we may not be successful in acquiring, exploring or
developing profitable oil and gas properties or interests, and we cannot give
any assurance that suitable oil and gas properties or interests will be
available for our acquisition, exploration or development. Despite this, we hope
to compete successfully in the oil and gas industry by:





·
            keeping our
      costs low;





·
            relying on
      the strength of our management’s contacts;
and





·
            using our
      size and experience to our advantage by adapting quickly to changing
      market conditions or responding swiftly to potential
      opportunities.




5




Subsidiaries




On
January 24, 2008 we incorporated APIC Resources, Inc. as our wholly owned
subsidiary.  On February 5, 2008 we issued a dividend of $0.000001 to
each of our 81,088,000 common shares outstanding as of February 5,
2008.  We satisfied this dividend by arranging APIC Resources, Inc. to
issue one share of their common stock for every $0.0001 of dividend
declared.  This effectively became an issuance of one APIC Resources,
Inc. share for every 100 shares of our stock held by our shareholders at
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 we cancelled our 100 shares in APIC Resources, Inc. and as of
February 5, 2008, we no longer owned any shares in APIC Resources,
Inc.




As
of March 17, 2009 we do not have any subsidiaries.




Intellectual
Property




We
have not filed for any protection of our trademarks for our corporate name. We
own the copyright of our logo and all of the contents of our website,
www.masspetroleum.com.




Research and Development
Expenditures




We
have not spent any amounts on research and development activities since our
inception. Our planned expenditures for our operation and exploration programs
are summarized under the section of this Annual Report entitled “Management
Discussion and Analysis of Financial Condition and Results of
Operations.”




Government
Regulations




Our current and
future operation and exploration activities are or will be subject to various
laws and regulations in US, Canada and possibly Russia in which we do or will
conduct our activities. These laws and regulations govern the protection of the
environment, conservation, prospecting, development, energy production, taxes,
labor standards, occupational health, work safety, toxic substances, chemical
products and materials, waste management, and other matters relating to the oil
and gas industry.  As we acquire more operating or exploration
interests, we will likely experience an increase in government oversight and
associated costs.





Regarding our
current non-operated interest, we are responsible for a 2.34% share of the costs
of (1) any claims arising from the production and sale of hydrocarbons from the
interest after August 1, 2006, which is the date we acquired our 2.34% interest
in the three wells in Oklahoma; (2) any governmental request or requirement to
plug, re-plug or abandon any wells, status or classification, or take any clean
up or other actions with respect to our interest; and (3) any claims for
personal injury, death, damage to property or damage to the environment arising
directly or indirectly from the use, occupation, operation, maintenance or
abandonment of our interest. As at November 30, 2008 we have not incurred any
such costs.





Permits,
registrations or other authorizations will be required for the operation of our
future facilities and for our future oil and gas exploration and production
activities. These permits, registrations or authorizations are subject to
revocation, modification and renewal. Governmental authorities have the power to
enforce compliance with these regulatory requirements, the provisions of
required permits, registrations or other authorizations, and lease conditions,
and violators are subject to civil and criminal penalties, including fines,
injunctions or both. Failure to obtain or maintain a required permit may also
result in the imposition of civil and criminal penalties. Third parties may have
the right to sue to enforce compliance.





We
expect to be able to comply with those laws and do not believe that compliance
will have a material adverse effect on our competitive position. We have
obtained, and intend to obtain all licenses and permits required by all
applicable regulatory agencies in connection with any oil and gas operations we
carry out and our future exploration activities. We intend to maintain standards
of environmental compliance consistent with regulatory requirements. We have
obtained, and will obtain at the appropriate time, environmental permits,
licenses or approvals required for our operations. We are not aware of any
material violations of environmental permits, licenses or approvals issued with
respect to our operations. We believe that the operator of the properties in
which we have an interest complies with all applicable laws, rules and
regulations relating to the control of air emissions on the
properties.  At this time, we do not anticipate any material capital
expenditures to comply with various environmental requirements.





Compliance with
environmental requirements, including financial assurance requirements and the
costs associated with the cleanup of any spill, could have a material adverse
effect on our capital expenditures, earnings or competitive position. Failure to
comply with any laws and regulations may result in the assessment of
administrative, civil and criminal penalties, the imposition of injunctive
relief or both. Legislation affecting the oil and gas industry is under constant
review for amendment or expansion, frequently increasing the regulatory burden.
Changes in any of these laws and regulations could have a material adverse
effect on business.  In view of the many uncertainties with respect to
current and future laws and regulations, including their applicability to us, we
cannot predict the overall effect of such laws and regulations on our future
operations.




6





US
Regulations





Our operations are
or will be subject to various types of regulation at the federal, state and
local levels.  Such regulation includes requiring permits for the
drilling of wells; maintaining bonding requirements in order to drill or operate
wells; implementing spill prevention plans; submitting notification and
receiving permits relating to the presence, use and release of certain materials
incidental to oil and gas operations; and regulating the location of wells, the
method of drilling and casing wells, the use, transportation, storage and
disposal of fluids and materials used in connection with drilling and production
activities, surface usage and the restoration of properties upon which wells
have been drilled, the plugging and abandoning of wells and the transporting of
production.





Our operations are
or will be also subject to various conservation matters, including the
regulation of the size of drilling and of spacing units or proration units, the
number of wells which may be drilled in each unit, and the unitization or
pooling of oil and gas properties.  In this regard, some states allow
the forced pooling or integration of tracts to facilitate exploration while
other states rely on voluntary pooling of lands and leases, which may make it
more difficult to develop oil and gas properties. In addition, state
conservation laws establish maximum rates of production from oil and gas wells,
generally limit the venting or flaring of gas, and impose certain requirements
regarding the ratable purchase of production.  The effect of these
regulations is to limit the amounts of oil and gas we may be able to produce
from our wells and to limit the number of wells or the locations at which we may
be able to drill.





Operations on
properties in which we have an interest are subject to extensive federal, state
and local environmental laws that regulate the discharge or disposal of
materials or substances into the environment and otherwise are intended to
protect the environment.  Numerous governmental agencies issue rules
and regulations to implement and enforce such laws, which are often difficult
and costly to comply with and which carry substantial administrative, civil and
criminal penalties and in some cases injunctive relief for failure to
comply.





Some laws, rules
and regulations relating to the protection of the environment may, in certain
circumstances, impose “strict liability” for environmental
contamination.  These laws render a person or company liable for
environmental and natural resource damages, cleanup costs and, in the case of
oil spills in certain states, consequential damages without regard to negligence
or fault.  Other laws, rules and regulations may require the rate of
oil and gas production to be below the economically optimal rate or may even
prohibit exploration or production activities in environmentally sensitive
areas.  In addition, state laws often require some form of remedial
action, such as closure of inactive pits and plugging of abandoned wells, to
prevent pollution from former or suspended operations.





Legislation has
been proposed in the past and continues to be evaluated in Congress from time to
time that would reclassify certain oil and gas exploration and production waste
as hazardous waste. If such reclassification is successful, it would make these
wastes subject to much more stringent storage, treatment, disposal and clean-up
requirements, which could have a significant adverse impact on operating
costs.  From time to time initiatives to further regulate the disposal
of oil and gas wastes are also proposed in certain states and may include
initiatives at the county, municipal and local government
levels.  These various initiatives could have a similar adverse impact
on operating costs.





The regulatory
burden of environmental laws and regulations increases our cost and risk of
doing business and consequently affects our profitability.  The
federal Comprehensive Environmental Response, Compensation and Liability Act, or
CERCLA, also known as the “Superfund” law, imposes liability, without regard to
fault, on certain classes of persons with respect to the release of a “hazardous
substance” into the environment.  These persons include the current or
prior owner or operator of the disposal site or sites where the release occurred
and companies that transported, disposed or arranged for the transport or
disposal of the hazardous substances found at the site.  Persons who
are or were responsible for releases of hazardous substances under CERCLA may be
subject to joint and several liability for the costs of cleaning up the
hazardous substances that have been released into the environment and for
damages to natural resources. It is not uncommon for the federal or state
government to pursue such claims. The federal Environmental Protection Agency
and various state agencies continue to promulgate regulations that limit the
disposal and permitting options for certain hazardous and non-hazardous
wastes.





It
is also not uncommon for neighboring landowners and other third parties to file
claims for personal injury or property or natural resource damages allegedly
caused by the release of hazardous substances into the environment.




7




Canadian
Regulations





As
our business plan may involve operation or exploration activities in Canada, we
expect to comply with Canadian laws and regulations related to the oil and gas
industry. Canada has regulatory provisions relating to permits for the drilling
of wells, the spacing of wells, the prevention of oil and natural gas waste,
allowable rates of production and other matters.  The amount of oil and
natural gas produced is subject to control by regulatory agencies in each
province that periodically regulate allowable rates of
production.





In
addition to the foregoing, our Canadian operations may be affected from time to
time by future political developments in Canada and by Canadian federal,
provincial and local laws and regulations, such as restrictions on production
and export, oil and natural gas allocation and rationing, price controls, tax
increases, expropriation of property, modification or cancellation of contract
rights, and environmental protection controls.





The Canada Oil and Gas Operations
Act provides for the making of regulations concerning the design, safety,
construction, installation, inspection, testing, monitoring, operation,
maintenance and repair of installations used in the exploration, development and
production of oil and gas. The Act prohibits anyone from carrying on any work or
activity related to the exploration for or the production of oil or gas unless
they first obtain a license or authorization issued by the National Energy
Board. As part of the application process, a plan must be submitted which shows
that Canadians are being employed and that Canadian goods and services are being
used. The National Energy Board may require that certain conditions be
fulfilled, for example, that the person obtain appropriate insurance and that
environmental studies be carried out.





The Oil and Gas Spills and Debris
Liability Regulations govern the limits of liability for spills,
authorized discharges and debris emanating or originating from work or activity
related to the exploration or production of oil and gas.





The Canada Oil and Gas Drilling
Regulations govern the exploration, drilling and conservation of oil and
gas and specifies measures to ensure the safety of these operations. These
regulations stipulate that no person may drill a well without authorization and
approval, which is obtained upon application to the Chief Conservation
Officer.





The Registration of Storage Tank Systems
for Petroleum Products and Allied Petroleum Products on Federal Lands or
Aboriginal Lands Regulations require registration of all specified
storage tank systems located on federal lands or aboriginal lands, with the
appropriate federal department administering the land. Environment Canada will
have access to the consolidated storage tank system records in each appropriate
federal department. A prohibition on fuel delivery is provided for any
unregistered storage tank systems.





Russian
Regulations





If
our transaction with Uraltransneft completes, we will be required to comply with
all applicable Russian regulations.  According to the laws and
regulations of the Russian Federation, organizations are permitted to carry out
development and production activities on licensed fields, provided the companies
conform to ecological standards. Accordingly, we will likely encounter two
separate costs associated with environmental law compliance: costs associated
with obtaining licenses and costs associated with obtaining permission from the
Russian Ministry of Natural Resources.





Though we did not
incur any costs associated with complying with government regulations for the
year ended November 30, 2008, if our acquisition of Uraltransneft completes or
we acquire other operating, non-operating or exploration interests, we will
likely incur such expenses.  However, exact expenses will depend on
the location, size and nature of any interests we may acquire.




Employees and
Consultants




As
of November 30, 2008, we did not have any full time or part time employees. Our
Chief Executive Officer and our Chief Financial Officer work as part time
consultants in the areas of business development and management; each
contributing approximately 15% of their time to us.  Our Secretary and
Treasurer is also involved in our operations and devotes approximately 10% of
his time to us.  We currently engage independent contractors in the
areas of accounting, geologist services, legal, auditing services, investment
banking and corporate development.





8


Item
1A. Risk Factors





Not
required.





Item
1B. Unresolved Staff Comments





None.





Item
2. Properties





The Kingfisher County
Wells




On
August 1, 2006, we purchased a 2.34% non operated interest in three producing
wells located in Kingfisher County, Oklahoma, which are described as Stebens #1,
Oblander #1-29 and Schneider #1. Our interest gives us the right to receive
2.34% of the operating profits from the operator of the wells, Range Resources
Corporation of Fort Worth, Texas.





During the first
six months of 2007, these wells produced a combined average of approximately 130
thousand cubic feet of gas per day and 1.2 barrels of oil per day. The 2.34%
interest generated an average monthly income of approximately $515 per month
during the past five years. We received revenues of $13,098 from our 2.34%
interest from February 2007 to November 30, 2008.





The following table
describes our interest in the Kingfisher County wells:





Name of
    Well
            Location
            Nature
      of InterestStebens
      #1
            Kingfisher
      County, Oklahoma
            2.34% non
      operated interestOblander
      #1-29
            Kingfisher
      County, Oklahoma
            2.34% non
      operated interestSchneider
      #1
            Kingfisher
      County, Oklahoma
            2.34% non
      operated interest







Other than our
interests in the Oklahoma Properties, we do not own or have any rights to
acquire any interests in any other oil and gas properties.





We
have an executive office located at Suite 507-700 West Pender Street, Vancouver,
British Columbia, Canada, V6C 1G8. From June 1, 2008 to November 30, 2008, we
rented office at a cost of $1,833 per month. From December 1, 2008 to May 31,
2008, our offices were provided to us by our former chief financial officer at
no charge and we recognized donated rent of $3,000 for the year ended November
30, 2008.





Item
3. Legal Proceedings





We
know of no material pending or active legal proceedings to which we are a party
or concerning any of our properties. We are not aware of any legal proceedings
contemplated by any governmental authority against us.





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




On
June 9, 2008, without the formality of convening a meeting, we received approval
from holders of 64% of our common voting stock to change our name from LAUD
Resources Inc. to MASS Petroleum Inc.









9




PART
II




Item
5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities.




Market
Information




There is a limited
public market for our common shares. Our common shares are quoted on the OTC
Bulletin Board under the symbol “MASP.OB”.  Trading in stocks quoted
on the OTC Bulletin Board is often thin and is characterized by wide
fluctuations in trading prices due to many factors that may be unrelated to a
company’s operations or business prospects. We cannot assure you that there will
be a market in the future for our common stock.




OTC Bulletin Board
securities are not listed or traded on the floor of an organized national or
regional stock exchange. Instead, OTC Bulletin Board securities transactions are
conducted through a telephone and computer network connecting dealers in stocks.
OTC Bulletin Board issuers are traditionally smaller companies that do not meet
the financial and other listing requirements of a regional or national stock
exchange.




Our common shares
became eligible for quotation on the OTC Bulletin Board on July 9, 2007, but no
trades were made until October 4, 2007.




The following table
shows the high and low bid quotations of our common shares on the OTC Bulletin
Board. The following quotations reflect inter-dealer prices, without retail
mark-up, mark-down or commission and may not necessarily represent actual
transactions:




Period
            
            High
      ($)
            
            
            Low
      ($)December 1,
      2008 – February 28, 2009
            
            
            2.85
            
            
            
            0.15September 1,
      2008 – November 30, 2008
            
            
            3.70
            
            
            
            2.25June 1, 2008
      – August 31, 2008
            
            
            4.65
            
            
            
            1.60March 1, 2008
      – May 31, 2008
            
            
            1.60
            
            
            
            0.71December 1,
      2007 – February 29, 2008
            
            
            1.01
            
            
            
            0.40July 30, 2007
      – November 30, 2007
            
            
            0.40
            
            
            
            0.40





During February
2009, the highest quoted price for our common stock was $0.45 and the lowest
quoted price was $0.15. The price quoted for our common stock on March 12, 2009
was $0.50 per share.




Holders




As
of March 12, 2009, there were 41 holders of record of our common
stock.




Dividends




On
February 5, 2008 we issued a dividend of $0.000001 to each of our 81,088,000
common shares outstanding as of February 5, 2008.  We satisfied this
dividend by arranging for APIC Resources, Inc., a Nevada company incorporated on
January 24, 2008, to issue one share of their common stock for every $0.0001 of
dividend declared.  This effectively became an issuance of one APIC
Resources, Inc. share for every 100 shares of our stock.  These shares
were issued pursuant to exemptions from registration under Regulation S and
Section 4(2) of the Securities Act.  In conjunction with this
arrangement we cancelled 100 shares which we owned in APIC Resources,
Inc.  Prior to the declaration of the dividend and cancellation of our
shares in APIC Resources, Inc., APIC Resources, Inc. was our wholly owned
subsidiary.  As of February 5, 2008, we no longer own any shares in
APIC Resources, Inc. and we do not have any subsidiaries.




10




Equity
Compensation Plans




We
have not implemented any equity compensation plans.




Recent
Sales of Unregistered Securities




Since December 1,
2007 to November 30, 2008, we completed one grant of unregistered securities
which was not previously reported in our quarterly filings for fiscal
2008:





·
            On June 9,
      2008 we granted to Vitaly Melnikov, our Chief Financial Officer, options
      to purchase 500,000 shares of our common stock in exchange for services
      rendered and to be rendered. The shares vested and will vest in four equal
      installments of 125,000 shares each, semi-annually over a period of 2
      years beginning on December 6, 2008, and the exercise price is $1.50 per
      share.




We
completed the offering of the common stock pursuant to Rule 903 of Regulation S
of the Securities Act on the basis that the sale of the common stock was
completed in an "offshore transaction", as defined in Rule 902(h) of Regulation
S. We did not engage in any directed selling efforts, as defined in Regulation
S, in the United States in connection with the sale of the units. Each investor
was not a US person, as defined in Regulation S, and was not acquiring the
shares for the account or benefit of a US person.




Each investor was
given adequate access to sufficient information about us to make an informed
investment decision. None of the securities were sold through an underwriter and
accordingly, there were no underwriting discounts or commissions involved. No
registration rights were granted to the recipient.




Use
of Proceeds from Sale of Registered Securities




None during the
fiscal year ended November 30, 2008.




Item
7. Management’s Discussion and Analysis of Financial Condition and Results of
Operation




Safe Harbor




This Annual Report
on Form 10-K contains forward-looking statements that involve risks and
uncertainties. These statements relate to future events or our future financial
performance. In some cases, you can identify forward-looking statements by
terminology including, "could" "may", "will", "should", "expect", "plan",
"anticipate", "believe", "estimate", "predict", "potential" and the negative of
these terms or other comparable terminology. These statements are only
predictions. Actual events or results may differ materially.




While these
forward-looking statements, and any assumptions upon which they are based, are
made in good faith and reflect our current judgment regarding the direction of
our business, actual results will almost always vary, sometimes materially, from
any estimates, predictions, projections, assumptions or other future performance
suggested in this Annual Report.




Overview




We
are engaged in the acquisition of interests and leases of producing oil and
natural gas wells. Our plan of operations for the next twelve months is to
create revenue from non-operated interests of producing oil and gas wells and to
acquire an interest in, and further develop a development stage oil and gas
exploration project.




We
have only recently begun our current operations, have earned nominal revenues
and have accumulated a net loss of $1,471,430 from February 14, 2006 (date of
inception) to November 30, 2008.


We
acquired a 2.34% interest in three wells in Kingfisher County, Oklahoma. We do
not yet have any exploration projects, but we are looking for new opportunities.
We need additional capital to carry out our current business plan. We also
anticipate that we will require additional financing in order to pursue full
exploration of our acquired claims. We may not have sufficient financing to
undertake our current and future business and there is no assurance that we will
be able to obtain the necessary financing.




We
are a start-up stage corporation with limited operations and limited revenues
from our business operations. Our auditors have issued us with a going concern
opinion. This means that our auditors believe there is substantial doubt that we
can continue as an on-going business for the next twelve months unless we obtain
additional capital to fund our operations. Our only source of cash at this time
is investments by others in our company. We must raise cash to implement our
plan of operation.




11




Liquidity and Capital
Resources




As
of November 30, 2008, we had cash of $45,994 compared to $229,288 in cash at
November 30, 2007.  At November 30, 2008, we had a working capital
deficit of $65,430 compared to a working capital surplus of $533,720 at November
30, 2007. Our accumulated deficit was $1,403,281 as at November 30, 2008
compared to $510,745 as at November 30, 2007.




Our net loss of
$1,471,430 from February 14, 2006 (date of inception) to November 30,
2008 has been funded primarily through the sale of shares of our common
stock, along with loans from our management team and other non-related parties.
For the fiscal year ended November 30, 2008, we borrowed net funds of $135,000
in debt financing and did not raise any funds from equity financing.
Cumulatively from February 14, 2006 (date of inception) to November 30, 2008, we
have borrowed total net funds of $135,000 and raised net proceeds of $444,500
from the sale of shares of our common stock.


Our cash
commitments for the next twelve months are as follows:




·
            On August 19,
      2008, we engaged Gryphon Trade and Finance, LLC to provide us with
      financial advisory services in connection with our equity and debt
      financing activities. We paid Gryphon $17,500 upon entering into the
      agreement and have agreed to pay an additional $17,500 within ten business
      days of accepting a funding proposal of $83,000,000 or more. We will also
      pay Gryphon 3% of the amount of any senior debt capital the company
      assists us in raising and 5% of the amount of any equity capital
      raised.




·
            On June 9,
      2008, we engaged a consultant, Vitaly Melnikov, to act as our Chief
      Financial Officer. The term of the consulting agreement is from June 9,
      2008 to June 6, 2011 and we have agreed to pay Cdn$3,000 per month and
      issue 500,000 stock options to purchase 500,000 common shares at an
      exercise price of $1.50 per share to Mr. Melnikov. The stock options will
      vest at a rate of 125,000 options on December 6, 2008, June 6, 2009,
      December 6, 2009, and June 6, 2010 and 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 us as of the date of the
      agreement assumes control of the us or acquires substantially all of our
      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.




·
            As at
      November 30, 2008 we had an outstanding accounts payable balance of
      $80,114 and accrued liabilities of
$2,655.




·
            As at
      November 30, 2008 we owed $25,000 to one of our shareholders, payable on
      January 31, 2009 or within seven days of our completion of a $1.5 million
      financing. The loan is unsecured and bears interest at 5% per
      annum.




·
            Also as at
      November 30, 2008, we owed $30,000 under a loan agreement which is due on
      October 15, 2009 or when upon our completion of a private placement or
      receipt of proceeds from other loans. The amount is unsecured and bears
      interest at a rate of 2% per annual, calculated on the basis of a 360 day
      year for the actual days elapsed. Interest that is not paid as it becomes
      due is added to the principal and is treated as part of the
      principal.




As
of November 30, 2008, we did not have enough cash to cover all payments to our
consultants and the outstanding balances under our two loans, which both come
due within the next twelve months. We plan to begin raising equity if and when
markets improve. We will attempt to renegotiate our loan agreements or make
other arrangements to defer payment on our outstanding loans. There can be no
assurance that markets will improve in the near future or that we will be
successful in arranging suitable terms for repayment of our outstanding loans.
Our ability to continue as a going concern remains uncertain.




We
used net cash of $243,294 in operating activities for the fiscal year ended
November 30, 2008, compared to $146,814 for the fiscal year ended November 30,
2007. For the period from February 14, 2006 (Date of Inception) to November 30,
2008, we used net cash of $421,077 in operating activities. The increase in net
cash used to fund our operations was $96,840 from fiscal 2007 to fiscal 2008 due
to increased operating activities after we acquired our 2.34% non operated
interest in three Kingfisher County oil wells.




We
used net cash of $75,000 in investing activities to fund a loan to Uraltransneft
Co. Ltd. under a loan agreement entered into on July 3, 2008, with the loan
bearing interest at a rate of 0.50% per annum. The loan became due on January 1,
2009 but has not yet been repaid. As there is no certainty as to when or if we
will ever be repaid, we have recognized a provision for the entire principal sum
of $75,000.




12




On
the financing side, we received net cash of $135,000 for the twelve months ended
November 30, 2008, compared to $276,500 for the twelve months ended November 30,
2007. The funds received in fiscal 2008 were comprised entirely of proceeds from
debt financing as follows:




·
            We entered
      into a loan agreement with one of our shareholders on July 3, 2008 and
      received a principal sum of $25,000 which is payable on January 31, 2009
      or within seven days of our completing a $1,500,000 financing. The loan is
      unsecured and bears interest at a rate of 5% per
  annum.




·
            We entered
      into a loan agreement with an unrelated party for $30,000 on October 15,
      2008 which is payable in one year or when we complete a private placement
      or receive proceeds from other loans. The amount is unsecured and bears
      interest at 2% per annum, calculated on the basis of a 360 day year for
      the actual number of days elapsed. Interest that is not paid as it becomes
      due is treated as part of the principal
sum.




Since our inception
to November 30, 2008, we have received net cash from financing activities of
$579,500, with $444,500 generated as net cash from private placement sales of
our common stock, and $135,000 from debt financing as disclosed in the preceding
paragraph. We have used net cash of $112,429 in investing activities from our
inception to November 30, 2008, including the loan of $75,000 to Uraltransneft,
$3,391 to purchase property and equipment, and $34,038 to purchase our 2.34% non
operated interest in three Kingfisher County oil wells.




During the fiscal
year ended November 30, 2008, we required approximately $35,090 in cash to fund
our operations each month. As of November 30, 2008, we had cash of
$45,994.  However, we anticipate that beginning December 2008 our
monthly expenses will increase to $269,000, which includes $7,000 monthly for
general and administrative expenses, $10,000 monthly for consulting and employee
expenses, $8,000 monthly for professional fees, $2,500,000 for the acquisition
of non-operated working interests and an exploration project and approximately
$66,667 monthly for exploration costs.




Currently, we are
reviewing additional non-operated working interests and leases in Oklahoma,
California, Texas, Canada and Russia.




We
expect to require approximately $3,937,000 in financing to continue our planned
operation and exploration over the next year. Our planned acquisition and
exploration expenditures for oil and gas interests and properties over the next
twelve months (beginning December 2008) are summarized as follows:




Description
            Potentialcompletion
      date
            EstimatedExpenses($)Retain a
      full-time engineer, a full-time land
      specialist and a full-time geologist
            April 1,
      2009
            242,000Purchase
      non-operated working interests in
      existing leases
            May 1,
      2009
            2,000,000Acquire a
      development stage exploration
      project
            August 1,
      2009
            500,000Develop and
      carry out a preliminary
      exploration program on an
      acquired property
            September 1,
      2009 – November 30,
      2010
            800,000Total
            
            3,542,000







Our other planned
operational expenses for the next twelve months (beginning December 2008) are
summarized as follows:




Description
            Potentialcompletion
      date
            EstimatedExpenses($)Select and
      appoint a new Board member
            May 1,
      2009
            -Raise
      additional private or publicequity
      (legal, accounting and marketing
      fees)
            May 1,
      2009
            70,000General and
      administrative expenses
            12
      months
            84,000Professional
      fees (legal, accounting
      and auditing fees)
            12
      months
            96,000Consulting
      and employee fees
            12
      months
            120,000Marketing
      expenses
            12
      months
            25,000Total
            
            395,000




Of
the $3,937,000 we need for the next 12 months, we had $45,994 in cash as of
November 30, 2008. We intend to raise the balance of our cash requirements for
the next 12 months ($3,891,006) from private placements or possibly a registered
public offering, or through further debt financing. At this time we do not have
any commitments from any broker-dealers 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,
investor sentiment, the availability of credit and our ability to secure credit
on reasonable terms. These factors may make the timing, amount, terms and
conditions of additional financing unattractive or unavailable to us. If we
cannot secure sufficient amounts to fund our business plan, 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.




13




Results of
Operations




We
earned nominal revenues for the year ended November 30, 2008 from our
non-operated working interests in three producing wells. We plan to purchase
additional non-operated working interests in existing leases. However, we
anticipate that we will incur substantial losses over the next two
years.




For the fiscal year
ended November 30, 2008, we generated revenues of $6,739 from our
non-operating interest in the Kingfisher property compared to revenues of $6,359
for the fiscal year ended November 30, 2007. The revenues earned in fiscal 2007
and 2008 are the only revenues we have earned since our inception, amounting to
total revenues of $13,098 from February 14, 2006 to November 30,
2008.




We have accumulated
total expenses of $1,409,528 from February 14, 2006 (date of inception) to
November 30, 2008 and incurred expenses of $458,677 for the year ended November
30, 2007. For the year ended November 30, 2008, our expenses increased by
$433,747 to $892,424, primarily due to a substantial increase in general and
administrative expenses as a result of our increased operations after acquiring
our non-operated interest in the Kingfisher county oil wells and consulting fees
we paid to our new management team.




Our accumulated
expenses from February 14, 2006 (date of inception) to November 30, 2008
included $23,812 in depletion and depreciation expenses, and $1,375,424 in
general and administrative expenses.  Of our accumulated general and
administrative expenses, $439,487 was incurred during the fiscal year ended
November 30, 2007 and $57,862 during the period from inception on February 14,
2006 to November 30, 2006.




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




On
August 19, 2008, we entered into an agreement with Gryphon Trade and Finance LLC
to provide us with financial advisory services in connection with our equity
raising and senior debt financing activities. We paid $17,500 upon entry into
the agreement, and have agreed to pay an additional $17,500 within ten days of
accepting a funding proposal of at least $83 million dollars. We will also pay
fees of 3% of the amount of any senior debt capital, and 5% of the amount of any
equity capital, raised with assistance from Gryphon.




From our inception
on February 14, 2006 to November 30, 2008 we accumulated a net loss of
$1,471,430. For the year ended November 30, 2008 we incurred net loss of
$960,685 compared to a net loss of $452,318 for the year ended November 30,
2007.  Our net loss increased by $508,367 from fiscal 2007 to fiscal
2008.




Off-Balance Sheet
Arrangements




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




14


Item
8. Financial Statements and Supplementary Data




Our fiscal year end
is November 30. Our audited financial statements as of November 30, 2008
follow.




MASS PETROLEUM
INC.


(formerly LAUD
Resources Inc.)


(An Exploration
Stage Company)


(Expressed in US
Dollars)








November 30,
2008










Report of
Independent Registered Public Accounting
Firm.........................................................F-1





Balance
Sheets.....................................................................................................................F-2





Statements of
Operations.......................................................................................................F-3





Statements of Cash
Flows......................................................................................................F-4





Statement of
Stockholders’
Equity...........................................................................................F-5





Notes to the
Financial
Statements...........................................................................................F-6







15


















Report of Independent
Registered Public Accounting Firm








To
the Directors and Stockholders


MASS Petroleum
Inc.


(An Exploration
Stage Company)







We have audited the
accompanying balance sheets of MASS Petroleum Inc. (An Exploration Stage
Company) as of November 30, 2008 and 2007, and the related statements of
operations, cash flows and stockholders' equity (deficit) for the years then
ended and accumulated for the period from February 14, 2006 (Date of Inception)
to November 30, 2008. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.




We conducted our
audits in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. The Company is not required to have, nor were we engaged to perform,
an audit of its internal control over financial reporting. An audit includes
consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of internal
control over financial reporting. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.




In our opinion, the
financial statements referred to above present fairly, in all material respects,
the financial position of MASS Petroleum Inc. (An Exploration Company) as of
November 30, 2008 and 2007, and the results of its operations, cash flows and
stockholders’ equity (deficit) for the years then ended and accumulated for the
period from February 14, 2006 (Date of Inception) to November 30, 2008 in
conformity with accounting principles generally accepted in the United
States.




The accompanying
financial statements have been prepared assuming the Company will continue as a
going concern. As discussed in Note 1 to the financial statements, the Company
has a working capital deficit of $65,430 and has incurred operating losses since
inception. These factors raise substantial doubt about the Company’s ability to
continue as a going concern. Management’s plans in regard to these matters are
also discussed in Note 1. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.








/s/
MANNING ELLIOTT LLP





CHARTERED
ACCOUNTANTS




Vancouver,
Canada




F-1




March 13,
2009


MASS Petroleum
Inc.


(formerly LAUD
Resources Inc.)


(An Exploration
Stage Company)


Balance
Sheets


(Expressed in US
dollars)








November
      30,2008
              $
            
            
            November
      30,2007
              $ASSETSCurrent
      AssetsCash
            
            
            45,994
            
            
            
            229,288Amounts
      receivable
            
            
            757
            
            
            
            976Prepaid
      expenses (Note 8(b))
            
            
            121,370
            
            
            
            313,953Total Current
      Assets
            
            
            168,121
            
            
            
            544,217Property and
      Equipment (Note 3)
            
            
            565
            
            
            
            1,695Oil and Gas
      Property (Note 4)
            
            
            13,052
            
            
            
            17,890Total
      Assets
            
            
            181,738
            
            
            
            563,802LIABILITIES
      AND STOCKHOLDERS’ EQUITYCurrent
      LiabilitiesAccounts
      payable
            
            
            80,114
            
            
            
            8,855Accrued
      liabilities
            
            
            2,655
            
            
            
            679Due to
      related parties (Note 7)
            
            
            95,782
            
            
            
            963Loans payable
      (Note 6)
            
            
            55,000
            
            
            
            –Total
      Liabilities
            
            
            233,551
            
            
            
            10,497Commitments
      and Contingencies (Notes 1, 11 and 12)Stockholders’
      (Deficit) EquityPreferred
      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
            
            
            
            8,109Additional
      paid-in capital
            
            
            1,377,758
            
            
            
            1,029,691Donated
      capital (Notes 7(a)(c))
            
            
            33,750
            
            
            
            26,250Deficit
      accumulated during the exploration stage
            
            
            (1,471,430
            )
            
            
            (510,745
            )Total
      Stockholders’ (Deficit) Equity
            
            
            (51,813
            )
            
            
            553,305Total
      Liabilities and Stockholders’ (Deficit) Equity
            
            
            181,738
            
            
            
            563,802




(The Accompanying
Notes are an Integral Part of These Financial
Statements)
 F-2




MASS Petroleum
Inc.


(formerly LAUD
Resources Inc.)


(An Exploration
Stage Company)


Statements of
Operations


(Expressed in US
dollars)








Accumulated
      from
              February
      14, 2006
              (Date
      of Inception)
              to
      November 30,2008
              $
            
            
            For
      the Year
      Ended
              November
      30, 2008
              $
            
            
            For
      the Year
      Ended
              November
      30, 2007
              $Revenue
            
            
            13,098
            
            
            
            6,739
            
            
            
            6,359ExpensesDepletion
            
            
            20,986
            
            
            
            4,838
            
            
            
            16,148Depreciation
            
            
            2,826
            
            
            
            1,130
            
            
            
            1,131General and
      administrative (Note 7(a)(b)(c))
            
            
            1,375,424
            
            
            
            878,075
            
            
            
            439,487Oil and gas
      production
            
            
            8,599
            
            
            
            6,688
            
            
            
            1,911Mineral
      property costs
            
            
            1,693
            
            
            
            1,693
            
            
            
            –Total
      Expenses
            
            
            1,409,528
            
            
            
            892,424
            
            
            
            458,677Net Loss
      Before Other Items
            
            
            (1,396,430
            )
            
            
            (885,685
            )
            
            
            (452,318
            )Provision for
      loan receivable
            
            
            (75,000
            )
            
            
            (75,000
            )
            
            
            –Net
      Loss
            
            
            (1,471,430
            )
            
            
            (960,685
            )
            
            
            (452,318
            )Net Loss Per
      Share – Basic and Diluted
            
            
            
            
            
            
            (0.01
            )
            
            
            (0.01
            )Weighted
      Average Shares Outstanding
            
            
            
            
            
            
            81,088,000
            
            
            
            77,916,000




(The Accompanying
Notes are an Integral Part of These Financial
Statements)
 F-3





MASS Petroleum
Inc.


(formerly LAUD
Resources Inc.)


(An Exploration
Stage Company)


Statements of Cash
Flows


(Expressed in US
dollars)








Accumulated
      from
              February
      14, 2006
              (Date
      of Inception)
              To
      November 30,2008
              $
            
            
            For
      theYear
      Ended
              November
      30,2008
              $
            
            
            For
      theYear
      Ended
              November
      30,2007
              $Operating
      ActivitiesNet
      loss
            
            
            (1,471,430
            )
            
            
            (960,685
            )
            
            
            (452,318
            )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depletion
            
            
            20,986
            
            
            
            4,838
            
            
            
            16,148Depreciation
            
            
            2,826
            
            
            
            1,130
            
            
            
            1,131Donated
      services and rent
            
            
            33,750
            
            
            
            7,500
            
            
            
            15,000Stock-based
      compensation
            
            
            825,477
            
            
            
            546,130
            
            
            
            275,479Provision for
      loan receivable
            
            
            75,000
            
            
            
            75,000
            
            
            
            –Changes in
      operating assets and liabilitiesAmounts
      receivable
            
            
            (757
            )
            
            
            219
            
            
            
            (976
            )Prepaid
      expenses
            
            
            (5,480
            )
            
            
            (5,480
            )
            
            
            –Accounts
      payable
            
            
            80,114
            
            
            
            71,259
            
            
            
            2,953Accrued
      liabilities
            
            
            2,655
            
            
            
            1,976
            
            
            
            (5,194
            )Due to
      related parties
            
            
            15,782
            
            
            
            14,819
            
            
            
            963Net Cash Used
      In Operating Activities
            
            
            (421,077
            )
            
            
            (243,294
            )
            
            
            (146,814
            )Investing
      ActivitiesLoan
      receivable
            
            
            (75,000
            )
            
            
            (75,000
            )
            
            
            –Purchase of
      property and equipment
            
            
            (3,391
            )
            
            
            –
            
            
            
            –Purchase of
      oil and gas property
            
            
            (34,038
            )
            
            
            –
            
            
            
            –Net Cash Used
      In Investing Activities
            
            
            (112,429
            )
            
            
            (75,000
            )
            
            
            –Financing
      ActivitiesProceeds from
      loan payable
            
            
            55,000
            
            
            
            55,000
            
            
            
            –Proceeds from
      related party loan
            
            
            80,000
            
            
            
            80,000Proceeds from
      issuance of common stock
            
            
            446,000
            
            
            
            –
            
            
            
            278,000Stock
      issuance costs
            
            
            (1,500
            )
            
            
            –
            
            
            
            (1,500
            )Net Cash
      Provided by Financing Activities
            
            
            579,500
            
            
            
            135,000
            
            
            
            276,500Increase
      (Decrease) in Cash
            
            
            45,994
            
            
            
            (183,294
            )
            
            
            129,686Cash -
      Beginning of Period
            
            
            –
            
            
            
            229,288
            
            
            
            99,602Cash - End of
      Period
            
            
            45,994
            
            
            
            45,994
            
            
            
            229,288Supplemental
      DisclosuresInterest
      paid
            
            
            –
            
            
            
            –
            
            
            
            –Income taxes
      paid
            
            
            –
            
            
            
            –
            
            
            
            –








(The Accompanying
Notes are an Integral Part of These Financial
Statements)
 F-4




MASS Petroleum
Inc.


(formerly LAUD
Resources Inc.)


(An Exploration
Stage Company)


Statement of
Stockholders’ Equity (Deficit)


For the Period from
February 14, 2006 (Date of Inception) to November 30, 2008


(Expressed in US
dollars)





DeficitAccumulatedAdditional
            
            
            Common
            
            
            
            
            
            During
      thePaid-in
            
            
            Stock
            
            
            Donated
            
            
            ExplorationShares
            
            
            Amount
            
            
            Capital
            
            
            Subscribed
            
            
            Capital
            
            
            Stage
            
            
            Total#
            
            
            $
            
            
            $
            
            
            $
            
            
            $
            
            
            $
            
            
            $Balance –
      February 14, 2006 (Date of Inception)
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –Common stock
      issued at $0.0001 per share
            
            
            100,000,000
            
            
            
            10,000
            
            
            
            (5,000
            )
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            5,000Common stock
      issued at $0.05 per share
            
            
            3,100,000
            
            
            
            310
            
            
            
            77,190
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            77,500Common stock
      issued at $0.25 per share
            
            
            684,000
            
            
            
            68
            
            
            
            85,432
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            85,500Cancellation
      of common stock
            
            
            (40,000,000
            )
            
            
            (4,000
            )
            
            
            4,000
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –Stock-based
      compensation
            
            
            –
            
            
            
            –
            
            
            
            800
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            800Common stock
      issued for consulting services
            
            
            12,000,000
            
            
            
            1,200
            
            
            
            223,800
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            225,000Common stock
      to be issued for consulting services rendered
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            2,500
            
            
            
            –
            
            
            
            –
            
            
            
            2,500Donated
      services and rent
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            11,250
            
            
            
            –
            
            
            
            11,250Net loss for
      the period
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            (58,427
            )
            
            
            (58,427
            )Balance –
      November 30, 2006
            
            
            75,784,000
            
            
            
            7,578
            
            
            
            386,222
            
            
            
            2,500
            
            
            
            11,250
            
            
            
            (58,427
            )
            
            
            349,123Common stock
      issued at $0.125 per share
            
            
            80,000
            
            
            
            8
            
            
            
            9,992
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            10,000Common stock
      issued for consulting services
            
            
            20,000
            
            
            
            2
            
            
            
            2,498
            
            
            
            (2,500
            )
            
            
            –
            
            
            
            –
            
            
            
            –Common stock
      issued at $0.25 per share less share issuance costs
            
            
            60,000
            
            
            
            6
            
            
            
            14,994
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            15,000Common stock
      issuance costs
            
            
            –
            
            
            
            –
            
            
            
            (1,500
            )
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            (1,500
            )Common stock
      issued for advisory services
            
            
            20,000
            
            
            
            2
            
            
            
            4,998
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            5,000Common stock
      issued at $0.225 per share
            
            
            1,124,000
            
            
            
            113
            
            
            
            252,887
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            253,000Common stock
      issued for consulting services
            
            
            4,000,000
            
            
            
            400
            
            
            
            359,600
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            360,000Donated
      services and rent
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            15,000
            
            
            
            –
            
            
            
            15,000Net loss for
      the year
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            (452,318
            )
            
            
            (452,318
            )Balance –
      November 30, 2007
            
            
            81,088,000
            
            
            
            8,109
            
            
            
            1,029,691
            
            
            
            –
            
            
            
            26,250
            
            
            
            (510,745
            )
            
            
            553,305Fair value of
      stock options
            
            
            –
            
            
            
            –
            
            
            
            348,067
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            348,067Donated
      services and rent
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            7,500
            
            
            
            –
            
            
            
            7,500Net loss for
      the year
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            –
            
            
            
            (960,685
            )
            
            
            (960,685
            )Balance –
      November 30, 2008
            
            
            81,088,000
            
            
            
            8,109
            
            
            
            1,377,758
            
            
            
            –
            
            
            
            33,750
            
            
            
            (1,471,430
            )
            
            
            (51,813
            )






(The Accompanying
Notes are an Integral Part of These Financial
Statements)
 F-5




MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)


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, 2007, 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 November 30, 2008, the Company has a working
capital deficit of $65,430, has not generated significant revenue and has
accumulated losses totaling $1,471,430 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)
            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, donated expenses, 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.




c)
            Cash and Cash
      Equivalents


The Company
considers all highly liquid instruments with maturity of three months or less at
the time of issuance to be cash equivalents.




d)
            Property and
      Equipment




Property and
equipment consists of computer hardware, is recorded at cost and is being
amortized on a straight-line basis over its estimated life of three
years.






F-6


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)


2.
            Summary of
      Significant Accounting Policies
(continued)




e)
            Earnings
      (Loss) Per Share




The Company
computes earnings (loss) per share in accordance with SFAS No. 128, “Earnings per Share”. SFAS No.
128 requires presentation of both basic and diluted earnings per share (“EPS”)
on the face of the income statement. Basic EPS is computed by dividing earnings
(loss) available to common shareholders (numerator) by the weighted average
number of shares outstanding (denominator) during the period. Diluted EPS gives
effect to all dilutive potential common shares outstanding during the period
using the treasury stock method and convertible preferred stock using the
if-converted method. In computing diluted EPS, the average stock price for the
period is used in determining the number of shares assumed to be purchased from
the exercise of stock options or warrants. Diluted EPS excludes all dilutive
potential shares if their effect is anti dilutive.




f)
            Comprehensive
      Loss


SFAS No. 130,
“Reporting Comprehensive
Income,” establishes standards for the reporting and display of
comprehensive loss and its components in the financial statements. As at
November 30, 2008 and 2007, the Company has no items that represent a
comprehensive loss and, therefore, has not included a schedule of comprehensive
loss in the financial statements.




g)
            Oil and Gas
      Properties




The Company
utilizes the full-cost method of accounting for petroleum and natural gas
properties.  Under this method, the Company capitalizes all costs
associated with acquisition, exploration and development of oil and natural gas
reserves, including leasehold acquisition costs, geological and geophysical
expenditures, lease rentals on undeveloped properties and costs of drilling of
productive and non-productive wells into the full cost pool on a country by
country basis. When the Company obtains proven oil and gas reserves, capitalized
costs, including estimated future costs to develop the reserves proved and
estimated abandonment costs, net of salvage, will be depleted on the
units-of-production method using estimates of proved reserves. The costs of
unproved properties are not amortized until it is determined whether or not
proved reserves can be assigned to the properties. Until such determination is
made the Company assesses annually whether impairment has occurred, and includes
in the amortization base drilling exploratory dry holes associated with unproved
properties.




The Company applies
a ceiling test to the capitalized cost in the full cost pool. The ceiling test
limits such cost to the estimated present value, using a ten percent discount
rate, of the future net revenue from proved reserves, based on current economic
and operating conditions. Specifically, the Company computes the ceiling test so
that capitalized cost, less accumulated depletion and related deferred income
tax, do not exceed an amount (the ceiling) equal to the sum of: (A) The present
value of estimated future net revenue computed by applying current prices of oil
and gas reserves (with consideration of price changes only to the extent
provided by contractual arrangements) to estimated future production of proved
oil and gas reserves as of the date of the latest balance sheet presented, less
estimated future expenditures (based on current cost) to be incurred in
developing and producing the proved reserves computed using a discount factor of
ten percent and assuming continuation of existing economic conditions; plus (B)
the cost of property not being amortized; plus (C) the lower of cost or
estimated fair value of unproven properties included in the costs being
amortized; less (D) income tax effects related to differences between the book
and tax basis of the property. For unproven properties, the Company excludes
from capitalized costs subject to depletion, all costs directly associated with
the acquisition and evaluation of the unproved property until it is determined
whether or not proved reserves can be assigned to the property. Until such a
determination is made, the Company assesses the property at least annually to
ascertain whether impairment has occurred. In assessing impairment the Company
considers factors such as historical experience and other data such as primary
lease terms of the property, average holding periods of unproved property, and
geographic and geologic data. The Company adds the amount of impairment assessed
to the cost to be amortized subject to the ceiling test.




h)
            Revenue
      Recognition




The Company
recognizes oil and gas revenue when production is sold at a fixed or
determinable price, persuasive evidence of an arrangement exists, delivery has
occurred and title has transferred, and collectability is reasonably
assured.




F-7


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)


2.
            Summary of
      Significant Accounting Policies
(continued)




i)
            Long-lived
      Assets




In accordance with
SFAS No. 144, “Accounting for
the Impairment or Disposal of Long-Lived Assets”, the Company tests
long-lived assets or asset groups for recoverability when events or changes in
circumstances indicate that their carrying amount may not be recoverable.
Circumstances which could trigger a review include, but are not limited to:
significant decreases in the market price of the asset; significant adverse
changes in the business climate or legal factors; accumulation of costs
significantly in excess of the amount originally expected for the acquisition or
construction of the asset; current period cash flow or operating losses combined
with a history of losses or a forecast of continuing losses associated with the
use of the asset; and current expectation that the asset will more likely than
not be sold or disposed significantly before the end of its estimated useful
life. Recoverability is assessed based on the carrying amount of the asset and
its fair value which is generally determined based on the sum of the
undiscounted cash flows expected to result from the use and the eventual
disposal of the asset, as well as specific appraisal in certain instances. An
impairment loss is recognized when the carrying amount is not recoverable and
exceeds fair value.




j)
            Asset
      Retirement Obligations




The Company follows
the provisions of SFAS No. 143, “Accounting for Asset Retirement
Obligations,” which establishes standards for the initial measurement and
subsequent accounting for obligations associated with the sale, abandonment or
other disposal of long-lived tangible assets arising from the acquisition,
construction or development and for normal operations of such
assets.




k)
            Financial
      Instruments


The fair values of
financial instruments, which include cash, amounts receivable, accounts payable,
amounts due to related parties and loans payable were estimated to approximate
their carrying values due to the immediate or short-term maturity of these
financial instruments.




l)
            Income
      Taxes




The Company
accounts for income taxes using the asset and liability method in accordance
with SFAS No. 109, “Accounting
for Income Taxes”. The asset and liability method provides that deferred
tax assets and liabilities are recognized for the expected future tax
consequences of temporary differences between the financial reporting and tax
bases of assets and liabilities, and for operating loss and tax credit
carryforwards. Deferred tax assets and liabilities are measured using the
currently enacted tax rates and laws that will be in effect when the differences
are expected to reverse. The Company records a valuation allowance to reduce
deferred tax assets to the amount that is believed more likely than not to be
realized.




m)
            Foreign
      Currency Translation




The Company’s
functional and reporting currency is the United States dollar. Occasional
transactions may occur in a foreign currency and management has adopted SFAS No.
52 “Foreign Currency
Translation”. Monetary assets and liabilities denominated in foreign
currencies are translated using the exchange rate prevailing at the balance
sheet date. Non-monetary assets and liabilities denominated in foreign
currencies are translated at rates of exchange in effect at the date of the
transaction. Average monthly rates are used to translate revenues and expenses.
Gains and losses arising on translation or settlement of foreign currency
denominated transactions or balances are included in the determination of
income. The Company has not, to the date of these financial statements, entered
into derivative instruments to offset the impact of foreign currency
fluctuations.




n)
            Stock-based
      Compensation




In
accordance with SFAS No. 123R “Share Based Payments,” the
Company accounts for share-based payments using the fair value method. All
transactions in which goods or services are the consideration received for the
issuance of equity instruments are accounted for based on the fair value of the
consideration received or the fair value of the equity instrument issued,
whichever is more reliably measurable.




F-8


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)


2.
            Summary of
      Significant Accounting Policies
(continued)




o)
            Deferred
      Financing Costs




In
accordance with the Accounting Principles Board Opinion 21 “Interest on Receivables and
Payables”, the Company recognizes debt issue costs on the balance sheet
as deferred charges, and amortizes the balance over the term of the related
debt. The Company follows the guidance in the EITF 95-13 “Classification of Debt Issue Costs
in the Statement of Cash Flows” and classifies cash payments for debt
issue costs as a financing activity.




p)
            Recent
      Accounting Pronouncements




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




In
May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles”. SFAS No. 162 identifies the sources of accounting
principles and the framework for selecting the principles to be used in the
preparation of financial statements of nongovernmental entities that are
presented in conformity with generally accepted accounting principles in the
United States. It is effective 60 days following the SEC’s approval of the
Public Company Accounting Oversight Board amendments to AU Section 411, “The Meaning of Present Fairly in
Conformity With Generally Accepted Accounting Principles”. The adoption
of this statement is not expected to have a material effect on the Company’s
financial statements.




In
March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative
Instruments and Hedging Activities – an amendment to FASB Statement No.
133”. SFAS No. 161 is intended to improve financial standards for
derivative instruments and hedging activities by requiring enhanced disclosures
to enable investors to better understand their effects on an entity’s financial
position, financial performance, and cash flows. Entities are required to
provide enhanced disclosures about: (a) how and why an entity uses derivative
instruments; (b) how derivative instruments and related hedged items are
accounted for under Statement 133 and its related interpretations; and (c) how
derivative instruments and related hedged items affect an entity’s financial
position, financial performance, and cash flows. It is effective for financial
statements issued for fiscal years beginning after November 15, 2008, with early
adoption encouraged. The adoption of this statement is not expected to have a
material effect on the Company’s financial statements.




In
December 2007, the FASB issued SFAS No. 141R, “Business
Combinations”.  This statement replaces SFAS 141 and defines
the acquirer in a business combination as the entity that obtains control of one
or more businesses in a business combination and establishes the acquisition
date as the date that the acquirer achieves control. SFAS 141R requires an
acquirer to recognize the assets acquired, the liabilities assumed, and any
noncontrolling interest in the acquiree at the acquisition date, measured at
their fair values as of that date. SFAS 141R also requires the acquirer to
recognize contingent consideration at the acquisition date, measured at its fair
value at that date. This statement is effective for fiscal years, and interim
periods within those fiscal years, beginning on or after December 15, 2008.
Earlier adoption is prohibited. The adoption of this statement is not expected
to have a material effect on the Company's financial statements.




In
December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements-an amendment of ARB No. 51”. SFAS No.
160 establishes accounting and reporting standards for the noncontrolling
interest in a subsidiary and for the deconsolidation of a subsidiary. SFAS No.
160 is effective for fiscal years, and interim periods within those fiscal
years, beginning on or after December 15, 2008. The adoption of this statement
is not expected to have a material effect on the Company’s financial
statements.




F-9


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)


2.
            Summary of
      Significant Accounting Policies
(continued)




p)
            Recent
      Accounting Pronouncements
(continued)




In
February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial
Assets and Financial Liabilities – Including an Amendment of FASB Statement No.
115”.  This statement permits entities to choose to measure
many financial instruments and certain other items at fair value. Most of the
provisions of SFAS No. 159 apply only to entities that elect the fair value
option. However, the amendment to SFAS No. 115 “Accounting for Certain
Investments in Debt and Equity Securities” applies to all entities with
available-for-sale and trading securities. SFAS No. 159 is effective as of the
beginning of an entity’s first fiscal year that begins after November 15, 2007.
The adoption of this statement did not have a material effect on the Company’s
financial statements.




In
September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”. The
objective of SFAS No. 157 is to increase consistency and comparability in fair
value measurements and to expand disclosures about fair value measurements. SFAS
No. 157 defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles, and expands disclosures about fair
value measurements. SFAS No. 157 applies under other accounting pronouncements
that require or permit fair value measurements and does not require any new fair
value measurements. The provisions of SFAS No. 157 are effective for fair value
measurements made in fiscal years beginning after November 15, 2007. The
adoption of this statement did not have a material effect on the Company’s
financial statements.








3.
            Property and
      Equipment





Cost
              $
            
            
            AccumulatedDepreciation
              $
            
            
            November
      30,2008
              Net
      CarryingValue
              $
            
            
            November
      30, 2007
              Net
      CarryingValue
              $Computer
      hardware
            
            
            3,391
            
            
            
            2,826
            
            
            
            565
            
            
            
            1,695







4.
            Oil and Gas
      Property








November
      30,2008
              Net
      CarryingValue
              $
            
            
            November
      30, 2007
              Net
      CarryingValue
              $Proved
      Properties, OklahomaAcquisition
      Costs
            
            
            34,038
            
            
            
            34,038Depletion
            
            
            (20,986
            )
            
            
            (16,148
            )Net Carrying
      Value
            
            
            13,052
            
            
            
            17,890




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.








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 has not collected the loan after it became due
on January 1, 2009.  As there is uncertainty as to the collectability
of the loan at November 30, 2008, a provision has been recognized for the entire
amount.






F-10


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)


6.
            Loans
      Payable




a)
            On July 3,
      2008, the Company entered into a loan agreement with a shareholder for
      $25,000 which is payable on January 31, 2009 or within seven days of the
      Company completing a $1,500,000 financing, is unsecured and bears interest
      at 5% per annum.




b)
            On October
      15, 2008, the Company entered into a loan agreement for $30,000 which is
      payable on October 15, 2009 or when the Company completes a private
      placement or receives proceeds from other loans.  The amount is
      unsecured and bears interest at 2% per annum, calculated on the basis of
      360 day year for actual days elapsed.  If interest is not paid
      as it becomes due, it will be added to the principal sum and treated as
      part of the principal sum.




7.
            Related Party
      Transactions




a)
            During the
      year ended November 30, 2008, the Company recognized $4,500 (2007 -
      $9,000) for donated services at $750 per month provided by the former
      President of the Company. Refer also to note
  7(b).




b)
            On June 9,
      2008, the Company entered into a consulting agreement with the CFO of the
      Company and agreed to pay Cdn$3,000 per month and issue 500,000 stock
      options to purchase 500,000 common shares at an exercise price of $1.50
      per share. During the year ended November 30, 2008, the Company paid
      $17,938 in management fees.




c)
            The Company
      recognized $3,000 (2007 - $6,000) of donated rent at $500 per month for
      office premises provided by the former CFO of the Company. Commencing June
      2008, the Company paid $11,000 of rent expense to an unrelated
      party.




d)
            As at
      November 30, 2008, the Company is indebted to the CFO of the Company for
      $5,014 (Cdn$6,211) (November 30, 2007 - $nil), representing $4,844 in
      management fees owed and $170 in expenditures paid for on behalf of the
      Company. The amount due is non-interest bearing, unsecured and due on
      demand.




e)
            On July 3,
      2008, the Company entered into a loan agreement with a company controlled
      by a director of the Company for $50,000 which is due on January 31, 2009
      or within seven days of the Company completing a $1,500,000 financing, is
      unsecured, and bears interest at 5% per annum. As at November 30, 2008,
      the Company is also indebted to this company for $1,668, which is
      non-interest bearing, unsecured and due on
  demand.




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 November 30, 2008,
      the Company is also indebted to this director for $9,100 (Cdn$10,812)
      (November 30, 2007 - $963), representing expenditures paid on behalf of
      the Company. These amounts is unsecured, non-interest bearing and due on
      demand.




8.
            Common
      Stock




The Common stock
transactions for the year ended November 30, 2007 are as follows:




a)
            On October 1,
      2007, the Company effected a 2:1 forward stock split of the authorized,
      issued and outstanding common stock. As a result, the authorized share
      capital increased from 80,000,000 shares of common stock to 160,000,000
      shares of common stock with no change in par value. All share amounts have
      been retroactively adjusted for all periods
  presented.




b)
            On July 24,
      2007, the Company issued 4,000,000 shares of common stock at a fair value
      of $360,000 to a consultant for services to be provided over a two year
      period. As at November 30, 2008, $115,890 (2007 - $296,384) is included in
      prepaid expenses and will be recognized over the remaining term of the
      consulting agreement.




c)
            On June 4,
      2007, the Company issued 924,000 units at approximately $0.225 per unit
      for proceeds of $208,000. Each unit is consisted of one share of common
      stock and one-tenth of a share purchase warrant. One whole share purchase
      warrant is exercisable into one common share at $0.25 per share until June
      4, 2009.




F-11


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)






8.
            Common
      Stock(continued)




d)
            On May 16,
      2007, the Company issued 200,000 shares of common stock at a price of
      $0.225 per share for proceeds of
$45,000.




e)
            On April 18,
      2007, the Company issued 20,000 shares of common stock at a fair value of
      $5,000 pursuant to an Advisory Board
Agreement.




f)
            On February
      2, 2007, the Company issued 60,000 shares of common stock at a price of
      $0.25 per share for proceeds of $15,000. In connection with this private
      placement, the Company paid a commission of $1,500 and issued 3,000 share
      purchase warrants at a fair value of $248 exercisable at $0.25 per common
      share until February 7, 2008.




g)
            On January
      12, 2007, the Company issued 20,000 shares of common stock at a fair value
      of $2,500 to a consultant for services rendered. This amount was recorded
      as common stock subscribed as at November 30,
  2006.




h)
            On December
      13, 2006, the Company issued 80,000 shares of common stock at a price of
      $0.125 per share for proceeds of
$10,000.




i)
            On November
      29, 2006, the Company issued 12,000,000 shares of common stock at a fair
      value of $225,000 pursuant to a consulting agreement. As at November 30,
      2007, $17,569 is included in prepaid expenses.  During the year
      ended November 30, 2008, the Company recognized $17,569 of consulting
      fees.




9.
            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 for these stock options was estimated at the date of
grant using the Black-Scholes option-pricing model assuming an expected life of
3.25 years, 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. As at November 30, 2008, there were 500,000 unvested stock
options. During the year ended November 30, 2008, the Company recorded
stock-based compensation of $348,067 as general and administrative
expense.




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






Number
      of Options
            
            
            Weighted
      Average
              ExercisePrice
              $
            
            
            Weighted
      Average Remaining Contractual
              Life
      (years)
            
            
            Aggregate
              IntrinsicValue
              $Outstanding,
      November 30, 2006 and 2007
            
            
            20,000,000
            
            
            
            0.0001Granted
            
            
            500,000
            
            
            
            1.50Cancelled
            
            
            (20,000,000
            )
            
            
            0.0001Outstanding,
      November 30, 2008
            
            
            500,000
            
            
            
            1.50
            
            
            
            2.77
            
            
            
            825,000Exercisable,
      November 30, 2008
            
            
            
            
            
            
            
            
            
            
            







F-12


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)






9.
            Stock Options
      (continued)




A
summary of the status of the Company’s non-vested stock options as of November
30, 2008, and changes during the year ended November 30, 2008, is presented
below:




Non-vested
      options
            
            Number
      of Options
            
            
            Weighted
      AverageGrant
      DateFair
      Value
              $Non-vested at
      November 30, 2007
            
            
            
            
            Granted
            
            
            500,000
            
            
            
            1.39Vested
            
            
            
            
            Non-vested at
      November 30, 2008
            
            
            500,000
            
            
            
            1.39




As
at November 30, 2008, there was $346,007 of unrecognized compensation costs
related to non-vested share-based compensation, which is expected to be
recognized over a weighted average period of 1.51 years.




10.
            Share
      Purchase Warrants




The following table
summarizes the continuity of the Company’s share purchase warrants:




Number
      ofWarrants
            
            
            Weighted
      Average Exercise Price
              $Balance,
      November 30, 2006
            
            
            –
            
            
            
            –Issued
            
            
            95,400
            
            
            
            0.25Balance,
      November 30, 2007
            
            
            95,400
            
            
            
            0.25Expired
            
            
            (3,000
            )
            
            
            0.25Cancelled
            
            
            (92,400
            )
            
            
            0.25Balance,
      November 30, 2008
            
            
            –
            
            
            
            –








11.
            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.
Closing of the Agreement is subject to the satisfaction of certain conditions
precedent including:




·
            Acquisition
      by Uraltransneft of a target corporation whose assets include full oil
      extraction infrastructure, transport equipment, pipeline, and wells
      producing 2,000 barrels of oil per day with at least 7,500,000 barrels of
      oil in reserves.




·
            Satisfactory
      completion of due diligence by the Company of certain oilfields confirming
      the presence of not less than 15,000,000 barrels of oil reserves, and
      assignment by Uraltransneft to the Company of an option agreement to
      purchase a 100% interest in those
oilfields.






F-13


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)




11.
            Share
      Exchange Agreement (continued)




·
            Resignation
      of Jordan Shapiro (resigned on June 9, 2008) as Chief Financial Officer,
      Principal Accounting Officer of the Company and resignation of Gary Chayko
      (resigned on June 24, 2008) as President, Chief Executive Officer and
      director of the Company.




·
            Surrender for
      cancellation by the former Chief Financial Officer of the Company, Hudson
      Capital Corp. and the former President of the Company of a total of
      40,088,000 common shares and 20,000,000 stock options (cancelled on July
      14, 2008) to purchase common shares of the
  Company.




·
            Satisfactory
      completion by the Company and Uraltransneft of customary due
      diligence.






Following closing,
the Company has agreed to provide $6,000,000 in financing to Uraltransneft in
four installments of $1,500,000 payable within seven days, three months, six
months, and one year following closing, respectively. Additionally, the Company
has agreed to make best efforts to secure up to $13,500,000 in financing for the
purchases of certain companies that hold oil extraction licenses of equivalent
value in relation to oil fields located in Perm Krai, Russia.




If the Company
fails to provide $6,000,000 in financing to Uraltransneft within one year of the
closing, either party may terminate the Agreement with notice. Upon such
termination, all transactions and cancellations of shares and options pursuant
to the Agreement will be reversed and Uraltransneft will be returned to its
original shareholders. In the event of termination, Uraltransneft will not have
any obligation to return any financing it receives pursuant to the
Agreement.




Also, following
closing, the Company has the non-exclusive option, based on market conditions,
to arrange on a best efforts basis for up to $13,500,000 in financing, the
proceeds of which shall be provided for the purchase of three companies which
have licenses for oil extraction from six oilfields located in Perm Krai, Russia
for $11,500,000 and $2,000,000.  Within seven days after the
acquisition of the six oilfields, Uraltransneft shall provide a detailed budget
of the first six months of activities in regards to the provision of the
necessary facilities to the oilfields. Within ten days of Closing, Uraltransneft
shall provide a purchase agreement for the acquisition of the three oil
extraction companies holding licenses for the development of six
oilfields.




As at November 30,
2008, management believes that the closing of this transaction is
uncertain.








12.
            Commitments




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.







F-14


MASS Petroleum
Inc.
 (formerly LAUD
Resources Inc.)
 (An Exploration
Stage Company)
 Notes to the
Financial Statements
 (Expressed in US
dollars)


13.
            Income
      Tax




The Company has a
net operating loss carryforward of $1,002,246 available to offset taxable income
in future years which commence expiring in fiscal 2026.




The Company is
subject to United States federal and state income taxes at an approximate rate
of 35%.  The reconciliation of the provision for income taxes at the
United States federal statutory rate compared to the Company’s income tax
expense as reported is as follows:







November
      30,2008
              $
            
            
            November
      30,2007
              $Income tax
      recovery at statutory rate
            
            
            336,240
            
            
            
            158,311Donated
      services
            
            
            (2,625
            )
            
            
            (5,250
            )Stock-based
      compensation
            
            
            (121,823
            )
            
            
            –Depletion and
      depreciation
            
            
            3,111
            
            
            
            (1,350
            )Provision for
      loan receivable
            
            
            (26,250
            )Valuation
      allowance change
            
            
            (188,653
            )
            
            
            (151,711
            )Provision for
      income taxes
            
            
            –
            
            
            
            –




The significant
components of deferred income tax assets and liabilities at November 30, 2008
and 2007 are as follows:




November
      30,2008
              $
            
            
            November
      30,2007
              $Net operating
      loss carryforward
            
            
            352,864
            
            
            
            164,714Oil and gas
      property
            
            
            3,772
            
            
            
            3,269Valuation
      allowance
            
            
            (356,636
            )
            
            
            (167,983
            )Net deferred
      income tax asset
            
            
            –
            
            
            
            –




F-15




Item
9. Changes In and Disagreements with Accountants on Accounting and Financial
Disclosure




None.





Item
9A. Controls and Procedures




Evaluation of Disclosure
Controls and Procedures





In
connection with the preparation of this annual report, an evaluation was carried
out by our management, with the participation of our 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 (the “Exchange Act”)) as of November 30,
2008.  Disclosure controls and procedures are designed to ensure that
information required to be disclosed in reports filed or submitted under the
Exchange Act is recorded, processed, summarized, and reported within the time
periods specified in the SEC’s rules and forms, and that such information is
accumulated and communicated to management, including the Chief Executive
Officer and Chief Financial Officer, to allow timely decisions regarding
required disclosures.




Based on that
evaluation, and the material weaknesses outlined in our Management Report on
Internal Control Over Financial Report, our management concluded, as of the end
of the period covered by this annual report, that our disclosure controls and
procedures were not effective in recording, processing, summarizing
and reporting information required to be disclosed, within the time periods
specified in the SEC’s rules and forms, and that such information
was not accumulated and communicated to management, including the
Chief Executive Officer and Chief Financial Officer, to allow timely decisions
regarding required disclosures.




Management Report on
Internal Control Over Financial Reporting





Our management is
responsible for establishing and maintaining effective internal control over
financial reporting.  Under the supervision of our Chief Executive
Officer and Chief Financial Officer, the Company conducted an evaluation of the
effectiveness of our internal control over financial reporting as of November
30, 2008 using the criteria established in Internal Control—Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO).




A
material weakness is a deficiency, or combination of deficiencies, in internal
control over financial reporting, such that there is a reasonable possibility
that a material misstatement of the Company’s annual or interim financial
statements will not be prevented or detected on a timely basis. In its
assessment of the effectiveness of internal control over financial reporting as
of November 30, 2008, the Company determined that there were control
deficiencies that constituted material weaknesses, as described
below.




1.
            Certain
      entity level controls establishing a “tone at the top” were considered
      material weaknesses. The Company has no independent directors and no audit
      committee. There is no policy on fraud.  A whistleblower policy
      is not necessary given the small size of the organization. There is no
      code of ethics.2.
            Due to the
      significant number and magnitude of out-of-period adjustments identified
      during the audit of our financial statements for the year ended November
      30, 2008, management has concluded that the controls over the period-end
      financial reporting process were not operating effectively. Controls were
      not effective to ensure that significant non-routine transactions,
      accounting estimates, and other adjustments were appropriately reviewed,
      analyzed, and monitored on a timely basis. A material weakness in the
      period-end financial reporting process could result in the Company not
      being able to meet its regulatory filing deadlines and, if not remediated,
      has the potential to cause a material misstatement or to miss a filing
      deadline in the future. Specific items of concern in our management report
      include the following:
              
              ·The value of
      stock based compensation awarded to a senior executive officer was
      understated due to problems with inputs used to effect the Black Scholes
      calculation.·Transfer
      agent and legal fees were under-accrued.·A prepaid
      expense for oil and gas exploration should have been partially expensed to
      recognize work exploration activities conducted during the year ended
      November 30, 2008.·A provision
      for accounts receivable was added to reflect the uncertainty of collection
      of the $75,000 loan to Uraltransneft.·Financing
      costs of $17,500 paid to Gryphon Finance and Trade LLC had to be expensed
      immediately because no specific financing was identified.·An
      outstanding cheque payable to one of our trade creditors was held back by
      us at year end; as a result, we were required to increase the balance of
      our cash and our accounts payable line items in our financial
      statements.





Management is
currently evaluating remediation plans for the above control
deficiencies.





In
light of the existence of these control deficiencies, the Company concluded that
there is a reasonable possibility that a material misstatement of the annual or
interim financial statements will not be prevented or detected on a timely basis
by the company’s internal controls.





As
a result, management has concluded that the Company did not maintain effective
internal control over financial reporting as of November 30, 2008 based on
criteria established in Internal Control—Integrated
Frameworkissued by COSO.





Manning Elliott
LLP, an independent registered public accounting firm, was not required to and
has not issued a report concerning the effectiveness of our internal control
over financial reporting as of November 30, 2008.




Changes in Internal
Control





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





Item
9B. Other Information.




None.




16




PART
III




Item
10. Directors, Executive Officers and Corporate Governance.





Directors and
Officers




Our bylaws allow
the number of directors to be fixed by the Board of Directors. Our Board of
Directors has fixed the number of directors at three.




Our current
directors and officers are as follows:





Name
            Age
            PositionOleg
      Bilinski
            45
            Director,
      President, Chief Executive OfficerVitaly
      Melnikov
            34
            Director,
      Chief Financial OfficerJordan
      Shapiro
            36
            Director,
      Secretary, Treasurer




The directors will
serve as directors until our next shareholder meeting or until a successor is
elected who accepts the position. Officers hold their positions at the will of
the Board of Directors.  There are no arrangements, agreements or
understandings between non-management shareholders and management under which
non-management shareholders may directly or indirectly participate in or
influence the management of our affairs.




Oleg
Bilinski, Director, President and Chief Executive Officer






Oleg Bilinsky has
been a director since June 17, 2008, and our President and Chief Executive
Officer since June 24, 2008. From Ju Mr. Bilinski has over 17 years of global
investment expertise including experience in the financing of natural resource
companies. Since 1990, he has been the President of UK International Trade
Corporation, a company whose main focus is to establish business relationships
between North America and Eastern Europe. He was also a founder of American
Uranium Corporation (OTC BB: AUUM) formerly Alpine Resources Corporation;
Geostar Mineral Corporation (OTC BB: GEOS); Chatsworth Data Solution (OTC BB:
CHWD) formerly Adera Mines Limited. Mr. Bilinski holds a degree in chemistry and
biology from Lviv State University in the Ukraine.




Vitaly
Melnikov, Director and Chief Financial Officer




Vitaly Melnikov has
been a director since June 17, 2008 and our Chief Financial Officer since June
9, 2008. From July 2002 to September 2005, Mr. Melnikov held the position of
Finance Manager (Marketing and Trading) of Hurricane Hydrocarbons Ltd.(also
known as PetroKazakhstan), a Calgary, Canada based, publicly traded energy
corporation engaged in the exploration, development, production, acquisition,
refining and marketing of oil and refined products in the Republic of
Kazakhstan. Among his duties there, Mr. Melnikov managed a multi-national team
of 30 financial and accounting specialists and oversaw the financial affairs and
sales units of companies with annual revenues of over $450 million. From
December 2005 to June 2007 Mr. Melnikov served as Vice President, Finance and
Administration of UrAsia Energy Ltd. (now Uranium One), a TSX and AIM listed
company with a market cap of $3 billion. While there, he assisted in the merger
of UrAsia Energy with Uranium One, creating a uranium producer with a $5 billion
market cap. From July 2007 to November 2007, Mr. Melnikov served as Interim
Chief Financial Officer and Controller of Tsar Emerald Corporation, a Vancouver
based company engaged in the extraction, processing and sale of gemstones. From
November 2007 to present, Mr. Melnikov has worked as a self employed financial
and accounting consultant in the natural resources sector. Mr. Melnikov holds a
masters degree in business administration from American University in
Kyrgyzstan.




Jordan
Shapiro, Director and Chief Financial Officer





Mr. Shapiro has
been a director and our Chief Financial Officer since our inception on February
14, 2006 to present. From 2002 to present, Mr. Shapiro has been the founder and
President of Hudson Capital Corporation, a venture capital firm assisting
companies in the areas of corporate finance, business development and investor
relations. From 1997 to 2002, Mr. Shapiro worked as an investment advisor at
Canaccord Capital Corporation, a company in the business of providing financial
services and investment advice to private investors and companies in Canada and
the United States. At Canaccord Capital, Mr. Shapiro specialized in venture
capital financings and derivatives trading. From November 2005 to present, Mr.
Shapiro has worked with Hemis Corporation, a public company quoted on the OTC
Bulletin Board under the symbol “HMSO.OB”, as an independent
contractor to provide financial consulting services in business
development.  Mr. Shapiro holds a Bachelor of Arts degree from the
University of Western Ontario.







Other than as
disclosed above, our directors currently do not serve on the boards of other
public companies.




17





Significant
Employees




There are no
individuals other than our executive officer who make a significant contribution
to our business.





Family
Relationships




There are no family
relationships among our officers or directors.





Legal
Proceedings




None of our
directors, executive officers, promoters or control persons has been involved in
any of the following events during the past five years:




·
            any
      bankruptcy petition filed by or against any business of which such person
      was a general partner or executive officer either at the time of the
      bankruptcy or within two years prior to that
  time;




·
            any
      conviction in a criminal proceeding or being subject to a pending criminal
      proceeding (excluding traffic violations and other minor
      offenses);




·
            being subject
      to any order, judgment, or decree, not subsequently reversed, suspended or
      vacated, of any court of competent jurisdiction, permanently or
      temporarily enjoining, barring, suspending or otherwise limiting his
      involvement in any type of business, securities or banking activities;
      or




·
            being found
      by a court of competent jurisdiction (in a civil action), the SEC or the
      Commodity Futures Trading Commission to have violated a federal or state
      securities or commodities law, and the judgment has not been reversed,
      suspended, or vacated.





Section 16(a) Beneficial
Ownership Compliance Reporting





Section 16(a) of
the Securities Exchange Act of 1934 requires a company’s directors and officers,
and persons who own more than ten-percent (10%) of the company’s common stock,
to file with the Securities and Exchange Commission reports of ownership on Form
3 and reports of change in ownership on Forms 4 and 5. Such officers, directors
and ten-percent stockholders are also required to furnish the company with
copies of all Section 16(a) reports they file. Based solely on our review of the
copies of such forms received by us and on written representations from certain
reporting persons, we believe that all Section 16(a) reports applicable to our
officers, directors and ten-percent stockholders with respect to the fiscal year
ended November 30, 2008 were filed.





Code of
Ethics




We
have not yet adopted a code of ethics that applies to our principal executive
officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions because we have not yet
finalized the content of such a code. Companies whose equity securities are
listed for trading on the OTC Bulletin Board are not currently required to
implement a code of ethics.




Director
Nominees





As
of November 30, 2008 there have been no material changes to the procedures by
which security holders may recommend nominees to our Board of
Directors.





Audit
Committee




The functions of
the Audit Committee are currently carried out by our Board of
Directors.  Our Board of Directors has determined that we do not
presently need an audit committee financial expert on our Board of Directors
carrying out the duties of the Audit Committee.  Our Board of
Directors has determined that the cost of hiring a financial expert to act as
one of our directors and to be a member of the Audit Committee or otherwise
perform Audit Committee functions outweighs the benefits of having a financial
expert on the Audit Committee.




18





Item
11. Executive Compensation.




The following
Summary Compensation Table sets forth the total annual compensation paid or
accrued by us to or for the account of the Principal Executive Officer (“PEO”)
and our Principal Financial Officer (“PFO”). None of our other executive
officers received compensation in excess of $100,000 during the fiscal year
ended November 30, 2008.





Summary
Compensation





Nameand PrincipalPosition
            Year
            Salary
              ($)
            Bonus
              ($)
            StockAwards
              ($)
            OptionAwards
              ($)
            Non-EquityIncentive
              PlanCompensation
              ($)
            Non-qualifiedDeferred
              CompensationEarnings
              ($)
            AllOtherCompensation
              ($)
            Total
              ($)Oleg
      Bilinsky President, CEO, Director (1)
            2008
            0
            0
            0
            0
            0
            0
            0
            0Vitaly
      Melnikov, CFO, Director (2)
            2008
            17,938
            0
            0
            348,067
      (3)
            0
            0
            0
            366,005Jordan
      Shapiro, Secretary, Treasurer, Director (4)
            2008
            0
            0
            0
            0
            0
            0
            0
            02007
            0
            0
            0
            0
            0
            0
            0
            02006
      (5)
            0
            0
            0
            (6)
            0
            0
            0
            0Gary
      Chayko (7)
            2008
            0
            0
            0
            0
            0
            0
            0
            02007
            0
            0
            0
            0
            0
            0
            0
            02006
      (5)
            0
            0
            0
            (6)
            (6)
            0
            0
            0








(1)
            Oleg Bilinsky
      has been our President and Chief Executive Officer since June 24, 2008 and
      a Director since June 17, 2008.


(2)
            Vitaly
      Melnikov has been our Chief Financial Officer since June 24, 2008 and a
      Director since June 17, 2008.


(3)
            On June 9,
      2008, we granted to Vitaly Melnikov options to purchase 500,000 shares of
      our common stock at an exercise price of $1.50 per share. The stock
      options will vest at a rate of 125,000 options on December 6, 2008, June
      6, 2009, December 6, 2009 and June 6, 2010. They are exercisable until the
      earlier of two years following their respective vesting dates or upon
      termination of the option agreement. All non-vested stock options will
      vest immediately, and may be exercised for a period of ninety days after
      such occurrence, if during the term of the agreement any non-affiliated
      third party assumes control of us or acquires substantially all of our
      assets. As of November 30, 2008, 125,000 options granted to Vitaly
      Melnikov have vested.


(4)
            Jordan
      Shapiro is a director and our Secretary and Treasurer. He held the
      position of Chief Financial Officer until his resignation effective June
      24, 2008.


(5)
            For the
      period from Inception (February 14, 2006) to November 30,
      2006.


(6)
            We issued
      10,000,000 post-split options to purchase shares of our common stock at an
      exercise price of $0.00005 to each of Gary Chayko and Jordan Shapiro.
      These options were cancelled effective July 17,
  2008.


(7)
            Gary Chayko
      is our former director, President and Chief Executive Officer. His
      resignation from these positions became effective on June 24,
      2008.





Mr. Melnikov, Mr.
Shapiro and Mr. Bilinski each spend approximately 15% of their time on our
business.





We
pay compensation of Cdn$3,000 per month to Vitaly Melnikov for services as our
director.





Except for options
granted to Mr. Melnikov as provided below, our executive officers and directors
did not receive any other compensation as directors or officers or any
benefits.




Outstanding
Equity Awards at Fiscal Year End





The following table
sets forth certain information concerning unexercised stock options held by the
named executive officers as of November 30, 2008. None of the named executive
officers exercised any of their stock options during the period from inception
(February 14, 2006) to November 30, 2008.





Name
            Number Of SecuritiesUnderlying UnexercisedOptions
      (#)
              Exercisable/Unexercisable
            Option
      Exercise Price per Share ($)
            Option
      Expiration DateVitaly
      Melnikov
            125,000 / 375,000
      (1)
            1.50
            Two
      years following vesting date (1)





(1)
            On June 9,
      2008, we granted to Vitaly Melnikov options to purchase 500,000 shares of
      our common stock at an exercise price of $1.50 per share. The stock
      options will vest at a rate of 125,000 options on December 6, 2008, June
      6, 2009, December 6, 2009 and June 6, 2010. They are exercisable until the
      earlier of two years following their respective vesting dates or upon
      termination of the option agreement. All non-vested stock options will
      vest immediately, and may be exercised for a period of ninety days after
      such occurrence, if during the term of the agreement any non-affiliated
      third party assumes control of us or acquires substantially all of our
      assets.






19





Item
12.  Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters.




The following table
sets forth the ownership, as of March 16, 2009, of our common stock by each of
our directors, and by all executive officers and directors as a group, and by
each person known to us who is the beneficial owner of more than 5% of any class
of our securities. As of March 16, 2009, there were 81,088,000 common shares
issued and outstanding. All persons named have sole voting and investment power
with respect to the shares, except as otherwise noted.  The number of
shares described below includes shares which the beneficial owner described has
the right to acquire within 60 days of the date of this Annual
Report.





Title
      of Class
            Name
      and Address ofBeneficial
      Owner
            Amount
      andNature
      ofBeneficialOwnership
            Percent
      ofClassCommon
            Jordan
      Shapiro (1)
              507-700 West
      Pender Street, Vancouver, British Columbia, V6C 1G8 Canada
            29,481,850
              (2)
            36%
              (3)Vitaly
      Melnikov
              1130 – 4825
      Hazel Street
              Burnaby,
      British Columbia, V5H 4N4Canada
            125,000
              (2)
            (3)
      (4)All
      Executive Officers and Directors as a Group
            29,606,850
            36%
      (3)Common
            Gary Chayko
      (5)
              200 Elgin
      Street, Suite 202
              Ottawa, ON
      K2P 1L5 Canada
            22,100,000
      (6)
            27%
              (3)




1
            Jordan
      Shapiro is our director, Secretary and
  Treasurer.




2
            Includes
      14,650,000 common shares held by Hudson Capital, a company wholly owned by
      Jordan Shapiro; 14,831,850 common shares held by Jordan Shapiro;
      and




3
            Calculated
      based on issued and outstanding shares of 81,088,000 as May 16, 2009, and
      as if all 20,000,000 options were exercised by Vitaly
      Melnikov.




4
            Less than
      1%.




5
            Gary Chayko
      is our former director, President and Chief Executive
    Officer.




6
            Includes
      22,100,000 shares owned by Gary
Chayko.







Pension, Retirement or
Similar Benefit Plans





There are no
arrangements or plans in which we provide pension, retirement or similar
benefits to our directors or executive officers. We have no material bonus or
profit sharing plans pursuant to which cash or non-cash compensation is or may
be paid to our directors or executive officers, except that stock options may be
granted at the discretion of the Board of Directors or a committee
thereof.





Compensation
Committee





We
currently do not have a compensation committee of the Board of Directors or a
committee performing a similar function. It is the view of the Board that it is
appropriate for us not to have such a committee because of our size and because
the Board as a whole determines executive compensation. Each of our directors is
also is a senior officer of the company.





Compensation Committee
Report





Our Board of
Directors as a whole has revised and discussed the compensation discussion and
analysis disclosed in this Form 10-K and based on this review and discussion,
has determined that the disclosure be included in this annual report. The
directors participating in this deliberate included Oleg Bilinski, Vitaly
Melnikov and Jordan Shapiro.




Compensation of
Directors
  We
do not pay our directors any fees for attendance at Board meetings or similar
remuneration or reimburse them for any out-of-pocket expenses incurred by them
in connection with our business.
 
 Change of
Control
 
 As
of November 30, 2008 we had no pension plans or compensatory plans or other
arrangements which provide compensation in the event of a termination of
employment or a change in our control.





20




Item
13. Certain Relationships and Related Transactions, and Director
Independence




During the year
ended November 30, 2008, we recognized $4,500 for donated services at $750 per
month provided by our former President, Gary Chayko.




We
recognized $3,000 for donated rent at $500 per month for office premises
provided by Jordan Shapiro, our director, Secretary and Treasurer, From December
1, 2007 to June 1, 2008.




On
June 9, 2008, we entered into a consulting agreement with Vitaly Melnikov, our
Chief Executive Officer, and agreed to pay to Vitaly Melnikov Cdn$3,000 per
month and issue 500,000 stock options to purchase 500,000 common shares at an
exercise price of $1.50 per share. During the year ended November 30, 2008, we
paid $17,938 in management fees.




As
at November 30, 2008, we are indebted to our Chief Financial Officer, Vitaly
Melnikov, for $5,014, representing $4,844 in management fees owed and $170 in
expenditures paid for on our behalf. The amount due is non-interest bearing,
unsecured and due on demand.




On
July 3, 2008, we borrowed $50,000 from Hudson Capital Corporation, a company
controlled by Jordan Shapiro, our director, pursuant to a loan agreement.
Repayment is due on January 31, 2009 or within seven days of our completion of a
$1,500,000 financing. The loan is unsecured and bears interest at 5% per annum.
As at November 30, 2008, we are also indebted to the lender for $1,668, which is
non-interest bearing, unsecured and due on demand.




On
October 8, 2008, we entered into a loan agreement with one of our shareholders
for $30,000 which is due on October 1, 2009 or within seven days of completion
of a financing by us in excess of $800,000. The loan is unsecured and bears
interest at 5% per annum.  As at November 30, 2008, we are also
indebted to this director for $9,100, representing expenditures paid on our
behalf by the director. This amount is unsecured, non-interest bearing and due
on demand.




Other than as
described above, we have not entered into any transactions with our officers,
directors, persons nominated for these positions, beneficial owners of 5% or
more of our common stock, or family members of these persons wherein the amount
involved in the transaction or a series of similar transactions exceeded the
lesser of $120,000 or 1% of our total assets for the last fiscal
year.





Director
Independence




The OTC Bulletin
Board on which our common shares are listed on does not have any director
independence requirements.  We also do not have a definition of
independence as our directors also hold positions executive officer positions
with us. Once we engage further directors and officers, we plan to develop a
definition of independence and scrutinize our Board of Directors with regards to
this definition.




Item
14. Principal Accounting Fees and Services




Audit, Audit-Related and
Non-Audit Fees






The following table
represents fees for the professional audit services and fees billed for other
services rendered by our current auditors, Manning Elliott for the audit of our
consolidated annual financial statements for the years ended November 30, 2007
and November 30, 2008 and any other fees billed for other services rendered
Manning Elliott during that period.




AUDIT,
      AUDIT-RELATED AND NON-AUDIT FEESDescription
      of Service
              
              Fees
      (December 1, 2006 to November 30, 2007)
                ($)
              
              
              Fees
      (December 1, 2007 to November 30, 2008)
                ($)Audit
      fees
              
              
              21,350
              
              
              
              24,375Audit-related
      fees
              
              
              -
              
              
              
              -Tax
      fees
              
              
              -
              
              
              
              5,000All
      other fees
              
              
              -
              
              
              
              -Total
              
              
              21,350
              
              
              
              29,375




Audit Committee
Approval





Since our
inception, our Board of Directors, performing the duties of the audit committee,
has reviewed all audit and non-audit related fees at least annually. The Board,
acting as the audit committee, pre-approved all audit related services for the
year ended November 30, 2008






21




Part
IV




Item
15.  Exhibits, Financial Statement Schedules





The financial
statement schedules are omitted because they are inapplicable or the requested
information is shown in our financial statements or related notes
thereto.





Exhibits





Exhibit
              Number
            Exhibit
              Description3.1
            Certificate
      of Amendment changing our name from LAUD Resources Inc. to MASS Petroleum
      Inc. (3)10.1
            Share
      Exchange Agreement with Uraltransneft Co. Ltd. dated May 16, 2008 and
      addendum thereto (1)10.2
            Consulting
      Agreement with Vitaly Melnikov for Services as CFO (2)10.3
            Agreement
      for Loan to Uraltransneft Co. Ltd. dated July 3, 2008
  (3)10.4
            Agreement
      for Loan from Hudson Capital Corporation dated July 3, 2008
      (3)10.5
            Agreement
      for Loan from Mark Levy dated July 3, 2008 (3)10.6
            Financial
      Services Letter Agreement with Gryphon Trade and Finance LLC dated August
      21, 200810.7
            Option
      Agreement with Vitaly Melnikov dated October 15, 200831.1
            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
      200231.2
            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
      200232.1
            Certification
      of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  200232.2
            Certification
      of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  2002





(1) Included as an
exhibit to our Form 8-K filed on May 23, 2008


(2) Included as an
exhibit to our Form 8-K filed on June 12, 2008


(3) Included as
exhibits to our Form 10-Q filed on July 21, 2008





SIGNATURES





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









MASS
      PETROLEUM INC.Date:  March
      17, 2009
            By:
            /s/
      Oleg BilinskiOleg
      BilinskiPresident, Chief Executive
      Officer
      and Director






Pursuant to the
requirements of the Exchange Act this Report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.










Signature
            Title
            Date/s/
      Jordan Shapiro
            Secretary,
      Treasurer, and
      Director
            March 17,
      2009Jordan
      Shapiro/s/
      Vitaly Melnikov
            Chief
      Financial Officer and Director
            March 17,
      2009Vitaly
      Melnikov