**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**




**FORM
        10-KSB**


**(Amendment
      No. 1)**









ý  **ANNUAL
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934**




For
      the
      fiscal year ended: **December
      31, 2007**




 ̈  **TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934**




For
      the
      transition period from: _____________ to _____________




**EGPI
      FIRECREEK, INC.**


(Name
      of
      small business issuer in its charter)





**Nevada**
            
            **000-32507**
            
            **88-0345961**(State
                or Other Jurisdiction
            
            (Commission
            
            (I.R.S.
                Employerof
                Incorporation)
            
            File
                Number)
            
            Identification
                No.)





**6564
      Smoke Tree Lane Scottsdale, AZ 85253**


(Address
      of Principal Executive Office) (Zip Code)




**(480)
      948-6581**


(Registrant’s
      telephone number, including area code)




**N/A**


(Former
      name or former address, if changed since last report)









**Securities
      registered pursuant to Section 12(b) of the Act:**


None




**Securities
      registered pursuant to Section 12(g) of the Act:**


Common
      Stock (Par Value $0.001 Per Share)





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




Indicate
      by check mark if there is no disclosure of delinquent filers in response to
      Item
      405 of Regulation S-B contained in this form, and no disclosures will be
      contained, to the best of registrant’s knowledge, in definitive proxy
      information statements incorporated by reference in Part III of this Form 10-KSB
      or any amendment to this Form 10-KSB. o




Indicated
      by a check mark whether the Registrant is a shell company (as defined in Rule
      12b-2 of the Act). Yes o No ý




The
      issuer’s revenues for its most recent fiscal year were $451,514




The
      aggregate market value on March 31, 2008 of common stock held by non-affiliates
      was approximately $340,050 based on the average of the closing bid and asked
      prices of the registrant’s common stock on such date, as quoted by the National
      Quotation Bureau.




As
      of
      March 31, 2008, the registrant had 1,184,257,619 shares of its $0.001 par value
      common stock issued and outstanding. There are also -0- shares of Series A,
      or B
      preferred stock, and 20,000,000 shares of its Series C preferred stock, issued
      and outstanding, at $0.001 par value for each of the Series of Preferred, and
      no
      shares of non-voting common stock issued and outstanding.




Transitional
      Small Business (Check One). Yes o No ý










**EGPI
      FIRECREEK, INC.**


**FORM
      10-KSB**


**FOR
      THE FISCAL YEAR ENDED DECEMBER 31, 2007**


**INDEX**





**PART
                I**Item
                1.
            Description
                of Business
            3Item
                1A.
            Risk
                Factors
            8Item
                2.
            Description
                of Property
            15Item
                3.
            Legal
                Proceedings
            26Item
                4.
            Submission
                of Matters to a Vote of Security Holders
            26**PART
                II**Item
                5.
            Market
                for Common Equity and Related Stockholder Matters
            27Item
                6.
            Management’s
                Discussion and Analysis or Plan of Operation
            30Item
                7.
            Financial
                Statements and Supplementary Data
            F-1-18Item
                8.
            Changes
                in and Disagreements with Accountants on Accounting and Financial
                Disclosure
            35Item
                8A.
            Controls
                and Procedures
            35Item
                8B.
            Other
                Information
            35**PART
                III**Item
                9.
            Directors,
                Executive Officers, Promoters and Control Persons, Compliance with
                Section
                16(A) of the Exchange Act
            36Item
                10.
            Executive
                Compensation
            39Item
                11.
            Security
                Ownership of Certain Beneficial Owners and Management
            43Item
                12.
            Certain
                Relationships and Related Transactions
            44Item
                13.
            Exhibits
            51Item
                14.
            Principal
                Accountant Fees and Services
            54SIGNATURES
            55




2




*This
      Annual Report on Form 10-KSB includes forward-looking statements within the
      meaning of Section 27A of the Securities Act of 1933, as amended, and
      Section 21E of the Securities Exchange Act of 1934, as amended. The Company
      has based these forward-looking statements on the Company’s current expectations
      and projections about future events. These forward-looking statements are
      subject to known and unknown risks, uncertainties and assumptions about us
      and
      the Company’s subsidiaries that may cause the Company’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 such forward-looking statements. In some cases, you can identify
      forward-looking statements by terminology such as “may,” “will,” “should,”
“could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,”
“continue” or the negative of such terms or other similar expressions. Factors
      that might cause or contribute to such a material difference include, but are
      not limited to, those discussed elsewhere in this Annual Report, including
      the
      section entitled “Risks Particular to the Company’s Business” and the risks
      discussed in the Company’s other Securities and Exchange Commission filings. The
      following discussion should be read in conjunction with the Company’s audited
      Consolidated Financial Statements and related Notes thereto included elsewhere
      in this report.*




**PART
      I**





**ITEM
      1 - DESCRIPTION OF BUSINESS**




**HISTORY**




EGPI
      Firecreek, Inc. (the “Company”, “EGPI”, “we”, “us” or “our” ) was incorporated
      in the state of Nevada on October 4, 1995 as Sterling Market Positions, Inc.
      with 10,000,000 shares of $.001 par value common stock authorized. Effective
      June 24, 1999, the Company changed its name to Energy Producers, Inc. and
      increased its authorized common shares to 50,000,000 with a par value of $0.001.
      The Company’s principal place of business is 6564 Smoke Tree Lane, Scottsdale,
      AZ 85253.




On
      August
      25, 1999, the Company was acquired by Energy Producers Group, Inc., and its
      wholly owned subsidiary, Producers Supply, Inc. The purpose of the acquisition
      and reverse merger was to become an oil and gas company, and later diversify.
      The Company focused its business on oil and gas exploration and acquiring
      existing production with proven reserves.




On
      December 31, 2005 the board of directors of the Company authorized the disposal
      of the Company’s wholly owned subsidiary marine sales segment assets and
      operations International Yacht Sales Group, Ltd. located in Torquay Devon,
      United Kingdom.




In
      March
      2006 the Company through its wholly owned subsidiary Firecreek Petroleum, Inc,
      (“Firecreek”), began production and sale of natural gas from completed wells
      located in Sweetwater County, Wyoming.




On
      December 13, 2006, the Company increased its total authorized capital stock
      from
      980,000,000 shares to 1,320,000,000.




On
      July
      1, 2007 the Company through its wholly owned subsidiary Firecreek began
      production and sale of oil from the Fant Ranch Unit located in Knox County,
      Texas.




***Overview***




The
      Company, through its wholly-owned subsidiary Firecreek, has been building and
      integrating a line segment of operations facilitating plans for the Company’s
      commencement of oil and gas operations.




During
      2006 the Firecreek operations were restructured resulting in its corporate
      offices being moved to Scottsdale, Arizona.




In
      2007
      the Company began focusing its efforts on development of domestically based
      oil
      and gas acquisition and production located in Texas and Wyoming.




**RECENT
      DEVELOPMENTS**




On
      January 3, 2008, the Company appointed Messrs. Michael Novielli, Douglas
      Leighton, Theodore Smith and Douglas D’Agata to the Company’s Board of
      Directors. For further information please see our Current Report on form 8-K
      filed on January 7, 2008, incorporated herein by reference and Item 9 contained
      in this Annual Report.




On
      December 26, 2007, in connection with the issuance of two Debentures to Dutchess
      Private Equities Fund, Ltd., the Company executed and delivered to Dutchess
      a
      Subscription Agreement pursuant to which the Company issued to Dutchess 700
      million shares of its common stock as additional consideration for certain
      financing and 20 million shares of its Series C Preferred Stock. As a result
      of
      these issuances, Dutchess shall own approximately eighty-five percent (85%)
      of
      the issued and outstanding shares of the Company’s common stock; such percentage
      ownership shall not change upon completion of the reverse stock split described
      above. Moreover, the Company agreed that all obligations pursuant to the
      Debenture are to be secured pursuant to that certain Security Agreement between
      the Company and Dutchess on March 27, 2007.


3




In
      January, 2008, Firecreek commenced with an enhancement/rehabilitation phase
      2
      program for the Fant Ranch Unit located in Knox County, Texas. The program
      includes cleaning out casing perforations, maintenance, paraffin removal, repair
      and acid stimulation for a majority of the oil wells in the unit. The purpose
      of
      the program has been to maintain the existing wells regularly, and to increase
      the overall well efficiency and production for the field. The Company has
      received early indications from its operator that the program has been
      successful.




On
      January 8, 2008, Firecreek entered into an Assignment and Bill of Sale (the
      “Assignment”) with Success Oil Co., Inc. (“SOC”) relating to the purchase and
      sale of certain 40 acre tract of land and leases (the “North 40”), with first
      right for an additional 40 acre lease (the “South 40”), located in Ward County,
      Texas, more commonly known as the J.B. Tubb leasehold estate (the “Tubb Lease”).
      The Company participated in a workover, drilling and development program, and
      has recently brought three wells online as a result. For further information
      please see our Current Report on form 8-K filed on January 9, 2008, incorporated
      herein by reference and information contained elsewhere in this Annual
      Report.




**THE
      BUSINESS**




Through
      the acquisition of Firecreek, the Company has been building and integrating
      a
      line segment of operations facilitating plans for the Company’s commencement of
      more focused domestically based oil and gas operations.




In
      our
      Fiscal Year 2006, the Company completed two workover programs, entered a third
      workover program, and commenced with natural gas production. This resulted
      from
      the acquisition of non operated oil and gas interests located in Sweetwater
      County, Wyoming in November 2005 (please see further information in this
      Section, under “Firecreek Current Oil and Gas Operations”, and additional
      information listed in Item 2, “Description of Property”).




In
      2007,
      the Company commenced with oil production related to the acquisition of the
      Fant
      Ranch Unit in Knox County, Texas. The Company’s production of oil was initiated
      from 17 producing oil wells and 1 injection well in the Fant system. In
      September of 2007 two more wells were brought online, one well for oil
      production, and one for water stimulation. Our Fiscal Year 2008 plans include
      continuing research and evaluation of acquisitions and development for oil
      and
      gas programs located primarily in the U.S, and will also include furthering
      work
      programs for our existing oil and gas properties.




***Firecreek
      Oil and Gas - Shift of Focus to Domestic Operations***




Through
      Firecreek, our goal is to become an independent oil and gas company engaged
      in
      the exploration, development and exploitation of crude oil and natural gas
      primarily in the United States. Our activities in 2005 were technically and
      politically focused on opportunities for the potential acquisition to enhance
      development of selected proved oil and gas projects located in Russia, and
      similar type viable projects in Romania and Kazakhstan and other countries
      within the same proximate geographical location.




Through
      a
      restructure of the Firecreek operations in 2006, operating overhead was reduced.
      Throughout 2006, the Company and Firecreek pursued business alliances to assist
      in potentially acquiring one or more domestic or overseas projects previously
      established through our strategic business relationships and alliances.




In
      2007
      due to the rising costs related to the pursuit of overseas activities relative
      to the cost of financing for our Company, we have elected to curtail foreign
      expenditures and concentrate on domestic projects. Please see additional
      information in this section at the heading ***Firecreek’s
      Overseas Project Activity Development in Central Asian and European Countries,
      and***  ***Firecreek’s
      Future Planned Oil and Gas Operations.***




**Firecreek’s
      Current Oil and Gas Operations**




***Ten
      Mile Draw Project, Sweetwater County, Wyoming***




Effective
      November 15, 2005, Firecreek purchased a 50% undivided non-operating interest
      in
      certain leases, wells, equipment, mineral interests including oil and gas
      reserves, and other rights, (the “Assets”) located in Sweetwater County, Wyoming
      from Newport Oil Corporation (“Newport”), under the prospect named “Ten Mile
      Draw” (“TMD”). An Operating Agreement was entered into at the time of the
      purchase, whereas Newport became operator for Firecreek’s non-operated 50%
      interests, and Newport’s operated 50% interests. The Operating Agreement also
      provides for our mutual understandings pertaining to the exploration and
      development of two tracts of land, and additional rights and options further
      established therein. In accordance with the terms of the Purchase and Operating
      Agreements, Newport initiated its Phase 1 work program in November and December
      2005 to re-complete the first two gas wells, and to restore their production
      to
      bring on line to the area pipeline system for sales of natural gas. As a result
      of these efforts, natural gas production commenced for the two initial wells
      as
      of approximately mid-March 2006. Under various rights established with Newport,
      we commenced with a third workover well program in third quarter 2006 completing
      the well in the first quarter of 2007. Due to technical issues, the 13-9 well
      has not yet achieved commercial production status, however we remain positive
      for future results. We continue to consider plans for expansion for well
      drilling development programs in the TMD but will be dependent on the economics
      in the area (also see “Description of Properties” and further discussion this
      section).


4




***Purchase
      and Work Program Costs Associated With Our Acquired Interests In The
      TMD***




The
      Company invested approximately $1.1 million on November 14, 2005 toward purchase
      of its interests and initial Phase 1 development in the TMD project. Of the
      $1.1
      million $601,000 was paid for the assets, and $488,130 was paid for workover
      costs and equipment as our share pursuant to the initial Authorization For
      Expenditure (“AFE”) estimate for workover for the first two wells at the time of
      closing pursuant to the terms of the Purchase and Operating Agreements with
      Newport. Newport also contributed the sum of $614,129.50 at the time of closing
      (total of $1,228,259) for its share of the initial Authorization For Expenditure
      estimate.




During
      Fiscal Year Ended 2006, the Company’s expenditures in the TMD project including
      capital expenses for equipment, totaled $403,732.  Total workover cost
      overages related to the first two wells, the 16-1 and 7-16 wells, and costs
      related to the AFE for a third workover well, the 13-9 well, and overage charges
      related to the 13-9 well workover program were $524,969. In the Fiscal Year
      Ended 2007, we incurred $74,564 toward additional costs related to the 13-9
      well.




Funding
      for the Company’s interests purchased in the Fiscal Year Ended 2005, and ongoing
      costs related to ongoing TMD project requirements for the Fiscal Year Ended
      2006
      were obtained from its Equity Line providers, Dutchess Private Equities Funds,
      through Dutchess Private Equities Fund, LP and Dutchess Private Equities Fund,
      II, LP (collectively “Dutchess”) in the form of a Promissory Note or Notes, as
      amended, and further secured by our interests held in TMD, and from each Put
      tendered pursuant to that certain Investment Agreement, as amended, dated August
      23, 2005, between the Company and Dutchess.




***Various
      Terms and Rights Under The Operating Agreement For The
      TMD***




The
      Operating Agreement provides for the duties and obligations of the operator
      and
      the obligations of Firecreek as the non-operator with respect to the funding
      of
      certain workover expenses and drilling operations in planning stages. The
      Operating Agreement provides that unless changed by other provisions therein,
      costs and liabilities incurred in operations are borne and paid equally by
      the
      parties, and equipment and materials acquired in operations are owned, according
      to their interests identified as 50% for Firecreek and 50% for Newport. There
      are workover obligations related to three existing wells of which two of the
      three wells were completed and brought online in 2006. The third workover under
      the same 50/50 structure as the first two workover wells was completed in the
      first quarter of 2007. The Operating Agreement further contemplates drilling
      new
      wells and development program related to our acquired interests on land and
      according to various rights and options therein available at our election,
      subject to terms of the Operating Agreement, to be undertaken on a third for
      quarter basis. The Operating Agreement calls for Newport to operate the leases,
      equipment, wells and reserve interests for the Company through Firecreek on
      a
      month-to-month accounting basis. Newport is experienced in the area with staff
      available for oversight and monitoring of the Company’s interests. Newport
      utilizes a pumper operator located in and familiar with that area. Newport
      shall
      administrate monthly activities including the Company’s expected gas production
      income when available, issuing monthly management reports, lease operating
      and
      interest owner expense and income payments, and compiling same for delivery
      to
      our accounting offices.




***Fant
      Ranch Unit Project, Knox County, Texas***




Effective
      July 1, 2007, Firecreek purchased a 100% working interest and corresponding
      75%
      net revenue interest  in certain leases, wells, equipment, mineral
      interests, oil and gas reserves (the “Assets”), known as the Fant Ranch Unit
      (“Fant”) located in Knox County, Texas from Ward Energy LP (“Ward”). We entered
      into a standard operating agreement at the time of the purchase with Success
      Oil
      Co. Inc., (“Success”) whereas Success became operator on behalf of the interests
      in Fant held by the Company through Firecreek, and subsequently taking over
      operations in transition from Wards then Operating unit. In September and
      October 2007, Firecreek engaged Success to initiate a Phase 1 workover and
      restoration program for two additional wells, the no.’s 7-1 and 1-4, to restore
      their production to bring on line for sales of oil. In early January 2008,
      the
      Company through its Firecreek unit engaged Success to commence with a Phase
      2
      work program for Fant (see additional discussion listed in “Recent Developments”
located at the beginning of this Report).


5




***Various
      Terms and Rights Under The Operating Agreement For The Fant Ranch
      Unit***




Under
      the
      Operating Agreement, Success is the operator of the Fant Ranch Unit for
      Firecreek’s working interests. The Operating Agreement provides for the duties
      and obligations of the operator and the obligations of Firecreek as the
      non-operator with respect to various lease operating and workover expenses.
      The
      Operating Agreement provides that unless changed by other provisions therein,
      costs and liabilities incurred in operations are borne and paid equally by
      the
      parties, and equipment and materials acquired in operations are owned, according
      to their interests identified as 100% for Firecreek. The Operating Agreement
      calls for Success to operate the Fant Ranch Unit, equipment, wells and reserve
      interests for the Company through Firecreek on a month-to-month accounting
      basis. Success is experienced in the area with staff available for oversight
      and
      monitoring of the Company’s interests. Success utilizes a pumper operator
      located in and familiar with that area. Success administrates monthly activities
      including the Company’s oil production income, issuing monthly management
      reports, lease operating and interest owner expense and income payments, and
      compiling same for delivery to our accounting offices.




***Purchase
      And Work Program Costs Associated With Our Acquired Interests In The Fant Ranch
      Unit***




The
      Company invested approximately $1.5 million on July 9, 2007 toward purchase
      of
      its 100% working interests in Fant Ranch Unit from Ward. In addition to the
      purchase price, the Company also purchased oil in the tanks in the amount of
      $38,705. Of the $1.5 million acquisition costs, $906,350 was attributed to
      the
      equipment, and $593,650 was attributed to the unit lease.




During
      the Year Ended 2007, the Company’s expenditures for Fant including repair and
      reinstatement of two wells, the no.’s 7-1 and 1-4, totaled $46,172.




Funding
      for the Company’s interests purchased in 2007 including workover and other
      related costs for the Fant were obtained from Dutchess in the form of a
      Debenture, and further secured by the assets of the Company. Additional terms
      for finance required 12% compound interest payable monthly, along with 20%
      of
      the production revenue net of operations expense, royalties, and taxes, and
      of
      other revenue of the Company.




***Competition***




The
      oil
      and gas industry is highly competitive. As a new independent domestic producer
      entering the oil and gas business, the Company will not initially own and may
      never own any refining or retail outlets and may have little control over the
      price it will receive for planned crude oil production. Although management
      has
      established relationships in its proposed acquisition activities, significant
      competition by individual producers and operators or major oil companies exists.
      Integrated and independent companies and individual producers and operators
      are
      active bidders for desirable oil and gas properties. Many of these competitors
      have greater financial resources than the Company currently has now or may
      have
      in the near future.




**Sales
      and Marketability**




***TMD
      Project, Wyoming***




The
      Company through its Firecreek unit commenced selling natural gas during 2006
      through the interests it holds in the leases, wells, and equipment in the TMD. A
      Gas Purchase Agreement was entered into November 11, 2005 by Emerald Operating
      Company (“Emerald”) as “Producer”, and Western Gas Resources, Inc. (“Western”).
      Effective January 1, 2006, Newport, the Company’s Operator for its interests in
      the TMD Project and Western, signed a Ratification Agreement, adopting the
      Gas
      Purchase Agreement as the agreement between them covering gas purchases,
      pursuant to which Newport became the “Producer”. Newport is the operating
      partner for our non operated interests owned in the TMD. The Gas Purchase
      Agreement has a term of three years, continuing thereafter until either party
      gives written notice of termination at least thirty days prior to the expiration
      of the primary term or any extension of the primary term. Payments relative
      to
      the Company’s receipt from Newport, based on Gas received to the pipeline are
      estimated to be a standard 45-60 days following monthly settlement and
      calculation by Western. The British Thermal Unit (BTU) content of our gas
      produced in the TMD workover wells tested above standard. Through Newport we
      are
      entitled to receive bonus payment adjustment increase for sales of gas, less
      gathering fees, as applicable, in accordance with the then terms and
      calculations of the Gas Purchase Agreement. Prices paid by Western accordingly
      are adjusted for a BTU content of each zone as well as the liquids revenue
      received. The Company believes it has no commitment that obligates us to produce
      any set amount of natural gas (see also “Description of properties”).




***Fant
      Ranch Unit, Texas***




The
      Company presently sells and receives monthly payment for the Fant Units
      production of oil in Knox County, Texas by division order with BML Inc. which
      was assigned at the closing by deed in lieu, operator to operator from Ward
      Energy LP operations unit Greasewood Oil to Success. BML purchases all of the
      Company’s crude oil pertaining to its interests owned based on a month-to-month
      contract, which can be terminated upon thirty (30) day’s notice by either party.
      A division order is a contract for the sale of oil, by the holder of a revenue
      interest in well or property,  to the purchaser.  It lists the names
      of revenue interest owners of a producible oil well or wells, along with the
      respective share of production revenues, and directs the purchaser to distribute
      the proceeds of production sales, accordingly. The Company receives according
      to
      its interests for the oil sold to BML, the average of the Plains price for
      the
      oil in for the month sold, adjusted by Platt pricing, less a transportation
      cost
      for the oil of $1.75 per barrel. The Company has no commitment that obligates
      us
      to produce any set amount of oil (see also “Management’s Discussion and Analysis
      of Financial Condition, and Plan of Operation", and "Description of
      properties").


6





Presently,
      the marketability of the Company's crude oil has not posed a problem for us.
       Crude oil can be easily sold wherever it is produced in the state(s) that
      the Company operates subject to the transportation cost. The crude oil produced
      by the Company is transported by truck.  On the other hand, natural gas can
      be more difficult to sell since transportation requires a pipeline.  In the
      areas that the Company is presently pursuing new drilling activity for natural
      gas, other companies have been delayed up to a year because of the
      unavailability of a pipeline. No assurance can be given that natural gas wells
      drilled by the Company will be placed on line within a year after the well
      is
      drilled and completed.





***Future
      Development Contemplated, Ten Mile Draw Project***




One
      of
      the opportunities of interest is a potential drilling program for 3-5 wells
      in
      the Almond and Lewis Sand formations at depths to approximately 4,500 feet.
      Presently, the Company holds interests and rights in areas being considered
      and
      available for one or more drilling programs. The properties and interests are
      located in our core area operated by Newport Oil Corporation, which can provide
      or sub contract the services for the drilling and development programs. Newport
      has worked several years in the region and is directly associated with the
      oil
      and gas business. Well data and older reserve analysis indicates that the Almond
      and Lewis Sand formations have historically produced long life reserves with
      a
      revenue potential, subject to inherent risks, for 20 to 30 years. The Company
      through Firecreek will continue to consider viability for future projects in
      the
      TMD. We will continue to review and consider timing factors and capital
      expenditure requirements related to area economics. These include pricing for
      site preparation, rig, equipment, crewing, permits, title, and legal costs.
      Other considerations include natural gas and area pipeline availability, and
      spot price fluctuations, and consideration of costs for a mud motor drilling
      program vs conventional drilling.




***Wyoming
      Regulations***




Any
      oil
      undertaking within the State of Wyoming requires obtaining the necessary permits
      and approvals from the Wyoming Oil and Gas Conservation Commission (“WOGCC”).
      Once a lease is obtained, an operator’s agreement must be on file with the
      WOGCC. In addition, federal regulations including those governed by the
      Environmental Protection Agency must be strictly followed (see additional
      discussion addressing the regulatory environment governing oil & gas
      drilling and production found under “Business Risks”; “Governmental
      Regulation”). We believe our operator Newport has obtained all necessary permits
      to operate the two workover wells associated with the Company’s interests in TMD
      project held by Firecreek.




***Texas
      Regulations***




Any
      oil
      undertaking with the State of Texas requires obtaining necessary permits and
      approvals from the Railroad Commission of Texas (“RRC”). Once a lease is
      obtained an operator’s agreement must be on file with the RRC.  Federal
      regulations including those governed by the Environmental Protection Agency
      must
      also be strictly followed (see additional discussion addressing the regulatory
      environment governing oil & gas drilling and production found under
“Business Risks”; “Governmental Regulation”). We believe our operator Success
      has obtained and or filed all necessary permits and reports to operate the
      wells
      and maintain compliance associated with the Company’s interests in Fant Ranch
      Unit held by Firecreek.




***Entry
      and Eventual Stability In The Oil And Gas Business Will Be Dependent Largely
      On
      Our Ability To Acquire Significant Financing Amounts***




The
      Company’s entry and eventual stability in the oil and gas business will be
      dependent largely on our ability to continuously acquire significant financing
      amounts, which may be necessary with and or in addition to its present equity
      line arrangements, and other potential financing providers, to carry out and
      implement its plans (see “Management Discussion and Analysis”, “Business Risks”,
      and “Liquidity and Capital Resources” sections).




The
      Company and its Firecreek unit are presently in different stages of review
      and
      discussion, gathering data and information, and any available reports on other
      potential field acquisitions, work over programs, and new drilling projects,
      located in Texas, New Mexico, and other productive regions and areas in the
      U.S.
      However, no assurances can be given by the Company that will be successful
      in
      pursuing these other prospects.




Successful
      negotiations for acquisitions, confidentiality, timing and the Company’s
      financial capabilities will continue to play a significant role in any success
      of both current and future operations for the Company activities, including
      existing subsidiary operations, and or any future planned subsidiary or special
      purpose entity (SPE) operations which in the future may exist.




From
      time
      to time Management will examine oil and gas operations in other geographical
      areas for potential acquisition and joint venture development.


7


***Firecreek’s
      Overseas Project Activity Development in Central Asian and European
      Countries***




***Strategic
      Alliance with Sahara Group***




For
      historical information regarding the Sahara Group please see the section titled
      “The Business” and other information contained in Form 10-KSB, as amended, filed
      April 14, 2006, and in Form 10-KSB/A(Amendment No. 3), as amended filed April
      11, 2008.




In
      2007,
      the Company focused on its domestic US oil and gas operations. There was no
      further activity with the Sahara group in Russia, Kazakhstan, Ukraine and
      Turkey, with the exception of the sale of certain opportunity rights to access
      of projects in Ukraine (for further information please see Item 6, Management
      Discussion and Analysis or Plan of Operation presented further this Report).
       It is the Company’s intention  to wind down the Sahara entity. The
      Company  may re enter negotiations at a future date predicated on the
      contacts and business relationships previously established in these
      countries.




***Firecreek’s
      Future Planned Oil and Gas Operations***




***Status
      of Firecreek’s Overseas Project Activity***




For
      current status of Firecreek please see information in this section “The
      Business” under above sub heading “Firecreek Oil and Gas Segment”. For
      historical information please also see “The Business” and other information
      contained in Form 10-KSB filed April 14, 2006, as amended, incorporated herein
      by reference, and in Form 10-KSB/A (Amendment No. 3), as amended filed April
      11,
      2008,




In
      2007
      the Company focused on its’ domestic US oil and gas operations. There was no
      further activity for Firecreek’s Overseas project activity in Romania and Libya.
      The Company may re enter negotiations at a future date predicated on the
      contacts and business relationships previously established in these
      countries.




**ITEM
              1A.**
            **RISK
                FACTORS**





**RISKS
      RELATED TO OUR BUSINESS**




**We
      incurred historical losses and have a working capital deficit. As a result,
      we
      may not be able to generate profits, support our operations, or establish a
      return on invested capital.**




We
      incurred net losses in fiscal year ended December 31, 2007 of $1,474,050 and
      net
      losses in fiscal year ended December 31, 2006 of $4,350,702. As of December
      31,
      2007, we had a working capital deficit of $3,519,638. In addition, we expect
      to
      increase our infrastructure and operating expenses to fund our anticipated
      growth. As a result, we may not be able to generate profits in 2008 or
      thereafter and may not be able to support our operations or otherwise establish
      a return on invested capital. We cannot assure you that any of our business
      strategies will be successful or that significant revenues or profitability
      will
      ever be achieved or, if they are achieved, that they can be consistently
      sustained or increased on a quarterly or annual basis.




**We
      Expect Our Operating Losses To Continue**




The
      Company expects to incur increased operating expenses during fiscal year 2008.
      The amount of net losses and the time required for the Company to reach and
      sustain profitability are uncertain. The likelihood of the Company’s success
      must be considered in light of the problems, expenses, difficulties, and delays
      frequently encountered in connection with a new business, including, but not
      limited to, uncertainty as to development and acquisitions and the time required
      for the Company’s planned production to become available in the marketplace.
      There can be no assurance that the Company will ever generate increased product
      revenue or achieve profitability at all or on any substantial basis. The Company
      incurred a net loss of $1,474,050 in fiscal 2007 and $4,350,702 in fiscal year
      2006.




**Our
      Level Of Indebtedness May Affect Our Business.**




Our
      level
      of indebtedness could have important consequences for our operations, including:




We
      may
      need to use a large portion of our cash flow to repay principal and pay interest
      on our debt, which will reduce the amount of funds available to finance our
      operations and other business activities;




Our
      debt
      level may make us vulnerable to economic downturns and adverse developments
      in
      our businesses and markets; and




Our
      debt
      level may limit our ability to pursue other business opportunities, borrow
      money
      for operations or capital expenditures in the future or implement our business
      strategy. Some of our debt is now overdue, however the holder of the debt has
      elected not to enforce the default provisions and continues to work with us,
      and
      has in fact issued new debt to us in March and June 2007 for our
      operations.


8




We
      expect
      to obtain the funds to pay our expenses and to pay principal and interest on
      our
      debt by utilizing cash flow from operations. Our ability to meet these payment
      obligations will depend on our future financial performance, which will be
      affected by financial, business, economic and other factors. We will not be
      able
      to control many of these factors, such as economic conditions in the markets
      in
      which we operate. We cannot be certain that our future cash flow from operations
      will be sufficient to allow us to pay principal and interest on our debt and
      meet our other obligations. If cash flow from operations is insufficient, we
      may
      be required to refinance all or part of our existing debt, sell assets, and
      borrow more money or issue additional equity.




**We
      have a limited amount of cash and are likely to require additional capital
      to
      continue our operations.**




We
      have a
      limited amount of available cash and will likely require additional capital
      to
      successfully implement our business plan. Although we raised gross proceeds
      of
      up to $4.0 million in May 2005 through the sale of callable secured convertible
      notes and three year common stock purchase warrants to Tirion, these funds
      were
      sufficient to sustain our operations for only 6 months. The Dutchess equity
      line
      and debentures have added additional working capital which will sustain our
      operations for an extended period of time; however, certain draw down
      restrictions pertaining to the Puts under the equity line apply which could
      shorten this period of time. There can be no assurance that we will be able
      to
      obtain additional funding when needed, or that such funding, if available,
      will
      be obtainable on terms acceptable to us. In the event that our operations do
      not
      generate sufficient cash flow, or we cannot obtain additional funds if and
      when
      needed, we may be forced to curtail or cease our activities, which would likely
      result in the loss to investors of all or a substantial portion of their
      investment.




***Production
      Risks***




All
      of
      the Company’s current and proposed oil and gas activities would be subject to
      the risks normally incident to the exploration for, and development and
      production of, natural gas and crude oil. These include, but are not limited
      to,
      blowouts, cratering and fires, each of which could result in damage to life
      and
      property. In accordance with customary industry practices, the Company plans
      to
      maintain future insurance for its proposed operations against some, but not
      all,
      of the risks. Losses and liabilities arising from such events could reduce
      revenues and increase costs to the Company to the extent not covered by
      insurance.




***Risks
      And Uncertainties Can Impact Our Growth***




There
      are
      several risks and uncertainties, including those relating to the Company’s
      ability to raise money and grow its business and potential difficulties in
      integrating new acquisitions for the oil and gas sector of operations,
      especially as they pertain to foreign markets and market conditions. These
      risks
      and uncertainties can materially affect the results predicted. Other risks
      include the Company’s limited operating history, the limited financial
      resources, domestic or global economic conditions, activities of competitors
      and
      the presence of new or additional competition, and changes in federal or state
      laws and conditions of equity markets.




The
      Company’s future operating results over both the short and long term will be
      subject to annual and quarterly fluctuations due to several factors, some of
      which are outside the control of the Company. These factors include but are
      not
      limited to fluctuating market demand for our services, and general economic
      conditions.




***Governmental
      Regulation***




***Effect
      of Probable Governmental Regulation on the Business Domestically and in Foreign
      Countries***




As
      we
      expand our efforts to develop our business, we will have to remain attentive
      to
      relevant federal and state regulations. We intend to comply fully with all
      laws
      and regulations, and the constraints of federal and state restrictions could
      impact the success of our efforts.




Our
      oil
      and gas business and services may become established in multiple states and
      foreign countries. These jurisdictions may claim that we are required to qualify
      to do business as a foreign corporation in each such state and foreign country.
      New legislation or the application of laws and regulations from jurisdictions
      in
      this area could have a detrimental effect upon our business. We cannot predict
      the impact, if any, that future regulatory changes or developments may have
      on
      our business, financial condition, or results of operation.




The
      Company and its current and future operations are subject to federal, state
      and
      local laws, and regulations and ordinances relating to the production and sale
      of oil and gas. Some of the laws that the Company is subject to include the
      Clean Air Act, the Clean Water Act, and the Endangered Species Act. Other laws
      and regulations include laws governing allowable rates of production, well
      spacing, air emissions, water discharges, marketing, pricing, taxes, and use
      restrictions and other laws relating to the petroleum industry. For example,
      coal bed methane wells are being highly regulated for disposing of produced
      fresh water on the surface. The EPA is requiring that the fresh water meet
      more
      stringent standards than before, and can require the water be injected
      underground making drilling these wells potentially uneconomical. As another
      example, Governmental
      regulation may delay drilling in areas that have endangered species. Therefore,
      if the Company were to undertake a drilling program in such an area by a
      proposed development project in the future, no assurance could be given that
      such delays would not become more expensive. Regulations may have a negative
      financial impact on us depending on the compliance costs.




9




Any
      failure to obtain, or delays in obtaining regulatory approvals by the Company
      or
      its operators, could delay or adversely affect the Company’s ability to generate
      revenues. These laws and regulations could impose substantial liabilities for
      the Company if it fails to comply. Further, there can be no assurance that
      the
      Company through its contract operators will be able to obtain necessary
      regulatory approvals for any of its future activities including those which
      may
      be proposed for the further development of oil and gas. Although the Company
      does not anticipate problems satisfying any of the regulations involved, the
      Company cannot foresee the possibility of new regulations, which could adversely
      affect the business of the Company.




Environmental
      regulations and taxes imposed by state governments in a jurisdiction wherein
      oil
      and gas properties are located impose a burden on the cost of production. Of
      the
      gross production revenues, severance and ad valorem taxes in Wyoming for oil
      and
      gas amount to approximately 12%.




Environmental
      requirements do have a substantial impact upon the energy industry. Generally,
      these requirements do not appear to affect the proposed Company operations
      any
      differently, or to any greater or lesser extent, than other companies in the
      domestic industry as a whole. The Company will establish policies and procedures
      for compliance with environmental laws and regulations affecting its proposed
      operations. The Company believes that compliance with environmental laws and
      regulations will not have a material adverse effect on the Company’s operations
      or financial condition. There can be no assurances, however, that changes in
      or
      additions to laws or regulations regarding the protection of the environment
      will not have such an impact in the future.




At
      this
      time no regulatory or additional regulatory approvals are necessary and, to
      the
      best knowledge of the officers, we have complied with all laws, rules and
      regulations.




***Cost
      And Effects Of Compliance With Environmental Laws***




Our
      business will be subject to regulation under the state and federal laws
      regarding environmental protection and hazardous substances control with respect
      to its current and future oil and gas operations. We are unaware of any bills
      currently pending in Congress that could change the application of such laws
      so
      that they would affect us.




***Risk
      Factors Affecting Our Future Results Of Operations For The
      Company***




Due
      to
      the Company’s limited operating history, it is difficult to accurately predict
      future revenues. This may result in one or more future quarters where the
      Company’s financial results may fall below the expectation of management and
      investors. However firmly management may believe in its prospects, the Company
      could fail. Operating results may vary, depending upon a number of factors,
      many
      of which are outside the Company’s control. Material factors expected to impact
      the Company’s operating results include, legal costs associated with
      registration of options and other filing requirements, expansion activities,
      increased interest and expenses for borrowings and possible hiring of additional
      full time employees. Every investor should evaluate the risks, uncertainties,
      expenses and difficulties frequently encountered by companies in the early
      stage
      of development. The past performance of the Company cannot be used to predict
      the future performance.




***Lack
      Of Experience***




Certain
      of our management may only devote a small percentage of their time to Company
      business. This lack of specific training, and experience for integration of
      the
      oil and gas sector coupled with working in the regulatory environment and less
      than full time effort in certain cases will probably cause management to miss
      opportunities that more experienced managers would recognize and take advantage
      of. Management’s decisions and choices may not be well thought out and
      operations and earnings and ultimate financial success may suffer irreparable
      harm. Additionally, these individuals have not previously worked together.
      If
      senior executives and managers are unable to work effectively as a team,
      business operations could be considerably disrupted.




***Oil
      And Gas Prices Fluctuate Widely, And Low Prices For An Extended Period Of Time
      Are Likely To Have A Material Adverse Impact On Our
      Business***




Our
      revenues, operating results, financial condition and ability to borrow funds
      or
      obtain additional capital depend substantially on prevailing prices for natural
      gas and, to a lesser extent, oil. Declines in oil and natural gas prices may
      materially adversely affect our financial condition, liquidity, ability to
      obtain financing and operating results. Lower oil and gas prices also may reduce
      the amount of oil and gas that we can produce economically. Historically, oil
      and gas prices and markets have been volatile, with prices fluctuating widely,
      and they are likely to continue to be volatile.


10




Prices
      for oil and natural gas are subject to wide fluctuations in response to
      relatively minor changes in the supply of and demand for oil and gas, market
      uncertainty and a variety of additional factors that are beyond our control.
      These factors include:




·
            The
                domestic and foreign supply of oil and natural
                gas.




·
            The
                level of consumer product
                demand.




·
            Weather
                conditions.




·
            Political
                conditions in oil producing regions, including the Middle
                East.




·
            The
                ability of the members of the Organization of Petroleum Exporting
                Countries to agree to and maintain oil price and production
                controls.




·
            The
                price of foreign imports.




·
            Actions
                of governmental authorities.




·
            Domestic
                and foreign governmental
                regulations.




·
            The
                price, availability and acceptance of alternative
                fuels.




·
            Overall
                economic conditions.




These
      factors make it impossible to predict with any certainty the future prices
      of
      oil and gas.




***Drilling
      natural gas and oil wells is a high-risk activity.***




Our
      growth is materially dependent upon the success of our drilling program.
      Drilling for natural gas and oil involves numerous risks, including the risk
      that no commercially productive natural gas or oil reservoirs will be
      encountered. The cost of drilling, completing and operating wells is substantial
      and uncertain, and drilling operations may be curtailed, delayed or cancelled
      as
      a result of a variety of factors beyond our control, including:




·
            unexpected
                drilling conditions, pressure or irregularities in
                formations;


·
            equipment
                failures or accidents;


·
            adverse
                weather conditions;


·
            compliance
                with governmental requirements; and


·
            shortages
                or delays in the availability of drilling rigs or crews and the delivery
                of equipment.




Our
      future drilling activities may not be successful and, if unsuccessful, such
      failure will have an adverse affect on our future results of operations and
      financial condition. Our overall drilling success rate or our drilling success
      rate for activity within a particular geographic area may decline. We may
      ultimately not be able to lease or drill identified or budgeted prospects within
      our expected time frame, or at all. We may not be able to lease or drill a
      particular prospect because, in some cases, we identify a prospect or drilling
      location before seeking an option or lease rights in the prospect or location.
      Similarly, our drilling schedule may vary from our capital budget. The final
      determination with respect to the drilling of any scheduled or budgeted wells
      will be dependent on a number of factors, including:




·
            the
                results of exploration efforts and the acquisition, review and analysis
                of
                the seismic data




·
            the
                availability of sufficient capital resources to us and the other
                participants for the drilling of the
                prospects




·
            the
                approval of the prospects by other participants after additional
                data has
                been compiled




·
            economic
                and industry conditions at the time of drilling, including prevailing
                and
                anticipated prices for natural gas and oil and the availability of
                drilling rigs and crews




·
            our
                financial resources and results;
                and




·
            the
                availability of leases and permits on reasonable terms for the
                prospects.




These
      projects may not be successfully developed and the wells, if drilled, may not
      encounter reservoirs of commercially productive natural gas or oil.


11





***Reserve
      estimates depend on many assumptions that may prove to be inaccurate. Any
      material inaccuracies in our reserve estimates or underlying assumptions could
      cause the quantities and net present value of our reserves to be overstated.***





Reserve
      engineering is a subjective process of estimating underground accumulations
      of
      natural gas and crude oil that cannot be measured in an exact manner. The
      process of estimating quantities of proved reserves is complex and inherently
      uncertain, and the reserve data included in this document are only estimates.
      The process relies on interpretations of available geologic, geophysic,
      engineering and production data. As a result, estimates of different engineers
      may vary. In addition, the extent, quality and reliability of this technical
      data can vary. The differences in the reserve estimation process are
      substantially due to the geological conditions in which the wells are drilled.
      The process also requires certain economic assumptions, some of which are
      mandated by the Securities and Exchange Commission, such as natural gas and
      oil
      prices. Additional assumptions include drilling and operating expenses, capital
      expenditures, taxes and availability of funds. The accuracy of a reserve
      estimate is a function of:


·
            the
                quality and quantity of available
                data;


·
            the
                interpretation of that data;


·
            the
                accuracy of various mandated economic assumptions;
                and


·
            the
                judgment of the persons preparing the
                estimate.





Results
      of drilling, testing and production subsequent to the date of an estimate may
      justify revising the original estimate. Accordingly, initial reserve estimates
      often vary from the quantities of natural gas and crude oil that are ultimately
      recovered, and such variances may be material. Any significant variance could
      reduce the estimated quantities and present value of our reserves.




***Our
      future performance depends on our ability to find or acquire additional natural
      gas and oil reserves that are economically recoverable.***




In
      general, the production rate of natural gas and oil properties declines as
      reserves are depleted, with the rate of decline depending on reservoir
      characteristics. Unless we successfully replace the reserves that we produce,
      our reserves will decline, eventually resulting in a decrease in natural gas
      and
      oil production and lower revenues and cash flow from operations. Our future
      natural gas and oil production is, therefore, highly dependent on our level
      of
      success in finding or acquiring additional reserves. We may not be able to
      replace reserves through our exploration, development and exploitation
      activities or by acquiring properties at acceptable costs. Low natural gas
      and
      oil prices may further limit the kinds of reserves that we can develop
      economically. Lower prices also decrease our cash flow and may cause us to
      decrease capital expenditures.




Exploration,
      development and exploitation activities involve numerous risks that may result
      in dry holes, the failure to produce natural gas and oil in commercial
      quantities and the inability to fully produce discovered reserves. We are
      continually identifying and evaluating opportunities to acquire natural gas
      and
      oil properties. We may not be able to successfully consummate any acquisition,
      to acquire producing natural gas and oil properties that contain economically
      recoverable reserves, or to integrate the properties into our operations
      profitably.




***Seasonality***




Demand
      for natural gas has historically been seasonal, with peak demand and typically
      higher prices occurring during the colder winter months.




***Regulation
      of Oil and Natural Gas Exploration and Production***




Exploration
      and production operations are subject to various types of regulation at the
      federal, state and local levels. This regulation includes requiring permits
      to
      drill wells, maintaining bonding requirements to drill or operate wells, and
      regulating the location of wells, the method of drilling and casing wells,
      the
      surface use and restoration of properties on which wells are drilled, and the
      plugging and abandoning of wells. Our operations are also subject to various
      conservation laws and regulations. These include the regulation of the size
      of
      drilling and spacing units or proration units, the density of wells that may
      be
      drilled in a given field and the unitization or pooling of oil and natural
      gas
      properties. Some states allow the forced pooling or integration of tracts to
      facilitate exploration while other states rely on voluntary pooling of lands
      and
      leases. In addition, state conservation laws establish maximum rates of
      production from oil and natural gas wells, generally prohibiting the venting
      or
      flaring of natural gas and impose certain requirements regarding the ratability
      of production. The effect of these regulations is to limit the amounts of oil
      and natural gas we can produce from our wells, and to limit the number of wells
      or the locations where we can drill. Because these statutes, rules and
      regulations undergo constant review and often are amended, expanded and
      reinterpreted, we are unable to predict the future cost or impact of regulatory
      compliance. The regulatory burden on the oil and gas industry increases the
      cost
      of doing business and, consequently, affects profitability. We do not believe,
      however, that we are affected differently by these regulations than others
      in
      the industry.


12




***We
      have limited control over the activities on properties we do not operate.***




Other
      companies operate some of the properties in which we have an interest. We have
      limited ability to influence or control the operation or future development
      of
      these non-operated properties or the amount of capital expenditures that we
      are
      required to fund with respect to them. The failure of an operator of our wells
      to adequately perform operations, an operator’s breach of the applicable
      agreements or an operator’s failure to act in ways that are in our best interest
      could reduce our production and revenues. Our dependence on the operator and
      other working interest owners for these projects and our limited ability to
      influence or control the operation and future development of these properties
      could materially adversely affect the realization of our targeted returns on
      capital in drilling or acquisition activities and lead to unexpected future
      costs.




***Requirement
      For Additional Capital***




The
      Company believes that additional debt or equity financing will be necessary
      to
      develop its planned activities through the next twelve to twenty four months.
      However, no assurance can be given that all or a significant portion of any
      debt
      or equity financing will be consummated, or that any changes in the Company’s
      operations and expansion plans would not consume available resources more
      rapidly than anticipated. The Company will need substantial funding to support
      the long-term expansion, development, and marketing of its business and
      subsidiary operations.




To
      the
      extent that the Company’s capital resources, including the proceeds of any
      offering, are insufficient to meet current or planned requirements, the Company
      will continue to seek additional funds through equity or debt financing,
      collaborative, or other arrangements with corporate partners, and from other
      sources, which may have the effect of diluting the holdings of existing
      shareholders. The Company has no effective or approved current arrangement
      with
      respect to such additional financing that is either secured or finalized at
      this
      time. Even though the Company has existing prospects for general or project
      financing, the outcome may change, be delayed, or may not be conclusive,
      therefore financing is not assured or guaranteed. Financing to be potentially
      obtained from prospects is not assured or guaranteed until actually consummated
      and financing actually provided.




***Need
      For Expansion***




The
      Company expects expansion will be required to address potential growth. This
      need for expansion will continue to place a significant strain on the management
      and financial resources of the Company. Failure to manage growth could disrupt
      the operations and ultimately prevent the Company from generating expected
      revenues. The Company’s business strategy includes entering into business
      partnerships and may include acquiring future businesses, such as, existing
      production or products, technology and acquisitions related to oil and gas
      or
      other resources, oil and gas field operations, and engineering. Other areas
      of
      future operations may include real estate, land and commercial development,
      technology and facilities, and fuel cell technology. The Company may be unable
      to complete suitable business partnerships and acquisitions on commercially
      reasonable terms, if at all. Competition could impair the Company’s ability to
      successfully pursue these aspects of this business strategy.




Business
      partnerships or acquisitions could disrupt ongoing business, distract management
      and employees and increase expenses. If the Company makes an acquisition, it
      could face difficulties assimilating that company’s personnel and operations.
      Key personnel of the acquired company may decide not to work for the Company.
      Acquisition of additional services or technologies also involves risk of
      incompatibility and lack of integration into existing operations. If the Company
      finances the acquisitions by issuing equity securities, this could dilute
      existing stockholders positions. Additionally, funding instruments may have
      rights, preferences or privileges senior to, or more favorably than, those
      of
      the Company’s stockholders.




***Limited
      Financial Data***




As
      a
      result of its limited operating history, the Company has limited historical
      financial data upon which to forecast revenues and results of operation. The
      actual effect of these factors on the price of stock will be difficult to
      assess. Results of operation may fall well below the expectations of securities
      analysts and investors, and the trading price of the Company’s common stock may
      drop.


13


**Estimating
      Inaccuracies**




There
      are
      numerous uncertainties inherent in estimating quantities of proven reserves
      and
      in projecting future rates of production and timing of development expenditures,
      including many factors beyond the control of the Company. Reserve engineering
      is
      a subjective process of estimating underground accumulations of crude oil,
      condensate and natural gas liquids that cannot be measured in an exact manner.
      The accuracy of any reserve estimate is a function of the amount and quality
      of
      data and of engineering and geological interpretation. Estimates by different
      engineers may vary. Results of drilling, testing and production after the date
      of an estimate may justify revision of such estimates. Reserve estimates are
      often different from the quantities ultimately recovered including the continual
      possibility of failure to find oil or gas and the drilling of a dry hole, and
      concentrations of oil in unexpected differing amounts on certain holes or
      targets drilled.




***Declining
      Reserves***




Volumes
      of proposed oil and gas reserves acquired by the Company will decline as
      reserves are depleted. Reserve volumes generated from future activities of
      the
      Company are highly dependent upon the level of success in acquiring or finding
      additional reserves.




***Key
      Officers Management Services Were Provided By Outside Consulting Firms, And
      Individuals Contributing Additional Key Officers Management Services, During
      Fiscal Year Ended December 31, 2007***




Individual
      outside consulting firms owned by key Officers and/or current Directors, Dennis
      R. Alexander, Chairman, President and CFO, Rupert C. Johnson, Director, Dermot
      McAtamney, Co-Treasurer and current Director, and Melvena Alexander,
      Co-Treasurer, Secretary and Comptroller, managed the business of the Company.
       Accordingly, the loss of the services of any key individual could have an
      effect on the development of the Company’s business. The Company may hire future
      employees and additional employees not provided through outside consulting
      firms, and depend on their services, the loss of which may effect the
      development of the Company’s business and could adversely affect the conduct of
      our business. While it intends to do so, the Company has not yet applied for
      key-man life insurance and the Company has not obtained insurance covering
      the
      possibility that any of its key officers and management personnel might become
      disabled or otherwise unable to render services to the Company. The success
      of
      the Company is also dependent upon its ability to attract, contract with and
      retain highly qualified technical, managerial and marketing personnel. The
      Company faces competition for such personnel from other companies, many of
      which
      have significantly greater resources than the Company. There can be no assurance
      that the Company will be able to recruit and retain such personnel.




***Officers
      And Directors Beneficially Own And Represent Approximately 76.21 % Of the
      Company’s Issued and Outstanding Common Stock***




The
      executive officers and directors of the Company currently beneficially own
      and
      represent approximately 76.21% of the issued and outstanding Common Stock.
      Accordingly, such persons may be able to maintain control the Board of Directors
      of the Company and direct the affairs of the Company.




***Penny
      Stock As A Risk***




Definition
      And Rule Reference: The Securities and Exchange Commission has adopted Rule
      3a51-1 of General Rules and Regulations, Promulgated under the Securities and
      Exchange Act of 1934, which established the definition of a “penny stock”, for
      the purposes relevant to the Company, as any equity security that has a market
      price of less than $5.00 per share, or with an exercise price of less than
      $5.00
      per share, subject to certain exceptions. For any transaction involving a penny
      stock, unless exempt, the rules require: (i) that broker or dealer approve
      a
      person’s account for transactions in penny stocks; and, (ii) the broker or
      dealer receive from the investor a written agreement to the transaction, setting
      forth the identity and quantity of the penny stock to be purchased.




***Future
      sales of our Shares of Common Stocks in the public market could lower our share
      price.***




We
      may
      sell additional Shares of Common Stock in subsequent offerings. We may also
      issue additional Shares of Common Stock to finance future acquisitions,
      including acquisitions larger than those we have done in the past. We cannot
      predict the size of future issuances of our Shares of Common Stock or the
      effect, if any, that future issuances and sales of our Shares of Common Stock
      will have on the market price of our Shares of Common Stock. Sales of
      substantial amounts of Shares of Common Stock, or the perception that such
      sales
      could occur, may adversely affect prevailing market prices for our Shares of
      Common Stock.




***Obligations
      And Contingencies***




The
      Company is liable for future restoration and abandonment costs associated with
      its oil and gas properties. These costs include future site restoration and
      plugging costs of wells. The cost of future abandonment of producing wells
      has
      not been determined the date of this report. Management believes that these
      costs will not have a material adverse effect upon its financial position or
      results of operations.


14




***Other***




The
      Company’s corporate parent operations during fiscal year ended 2007 did not
      retain any employees. Individual consulting firms owned by two key
      officers/directors along with three additional key officers/directors
      contributing time and effort managed the day-to-day operations of our Company.
      We have accounting consultants, legal consultants, oil and gas technical team
      consultants and engineers available for project purposes on a part time basis;
      one advisor assists us with project evaluations and business development,
 information and research, technical writing and presentation. The Company
      will consider full time employees upon sufficient capitalization and cash flow
      which may include accounting systems and data processing coordinator, oil and
      gas staff analyst and coordinator, financing officer; assistant to executive
      officers, and other. Future performance will be substantially dependent on
      the
      continued services of management and the ability to retain and motivate them.
      The loss of the services of any officers or senior managers could affect
      activities of our business and its operations until additional personnel can
      be
      retained and trained to perform some of the management tasks. At the present
      time the Company does not have long-term employment agreements with any key
      personnel and does not maintain any life insurance policies.




**ITEM
              2.**
            **DESCRIPTION
                OF PROPERTY**





Glossary
      of Oil and Gas Terms.




Barrel:
      Equal to 42 U.S. gallons.




Basin:
      A
      depressed sediment-filled area, roughly circular or elliptical in shape,
      sometimes very elongated. Regarded as a good area to explore for oil and
      gas.




British
      thermal unit, (BTU): A measure of the heating value of a fuel.




Completion:
      The installation of permanent equipment for the production of oil or
      gas.




Field:
      A
      geographic region situated over one or more subsurface oil and gas reservoirs
      encompassing at least the outermost boundaries of all oil and gas accumulations
      known to be within those reservoirs vertically projected to the land
      surface.




Fracturing:
      The application of hydraulic pressure to the reservoir formation to create
      fractures through which oil or gas may move to the wellbore.




Improved
      Oil Recovery (“IOR”): Effort to improve or enhance oil recovery that does not
      include secondary or tertiary basic recovery methods. In most oil fields, only
      a
      fraction of the oil can be produced by natural reservoir pressure and by
      conventional methods such as pumping. The remaining, or residual, oil can be
      recovered only by using recovery methods that restore pressure and fluid flow
      in
      underground formations through the introduction of water, gas, chemicals, or
      heat into the reservoir.




License:
      Formal or legal permission to explore for oil and gas in a specified
      area.




Log:
      Io
      conduct a survey inside a borehole to gather information about the subsurface
      formations; the results of such a survey. Logs typically consist of several
      curves on a long grid that describe properties within the wellbore or
      surrounding formations that can be interpreted to provide information about
      the
      location of oil, gas, and water. Also called well logs, borehole logs, wireline
      logs.




Mcf:
      Is a
      thousand cubic feet of natural gas.




Mineral
      interest: The ownership of rights to gas, oil, or other minerals as they
      naturally occur in place, at or below the surface of a tract of land. Ownership
      of the minerals carries with it the right to make such reasonable use of the
      surface as may be necessary to explore for and produce the minerals. Only the
      mineral owner (or fee owner) may execute an oil or gas lease conveying his
      interest in a tract of land.




Oil:
      Crude oil or condensate.




Operator:
      An individual, company, trust, or foundation responsible for the exploration,
      development, and production of an oil or gas well or lease.




Productive:
      Able to produce oil and/or gas.


15




Proved
      reserves: Estimated quantities of crude oil, condensate, natural gas, and
      natural gas liquids that geological and engineering data demonstrate with
      reasonable certainty to be commercially recoverable in the future from known
      reservoirs under existing conditions using established operating procedures
      and
      under current governmental regulations.




Proved
      undeveloped reserves: Economically recoverable reserves estimated to exist
      in
      proved reservoirs, which will be recovered from wells, drilled in the
      future.




Reserves:
      The estimated value of oil, gas and/or condensate, which is economically
      recoverable.




Tons:
      A
      ton of oil is equal to 7.29 barrels of oil.




Working
      interest: The percentage of the operating, drilling, completing and reworking
      costs that the Company is required to pay. The net revenue interest is the
      percentage of the revenues that the Company receives from the sale of oil that
      is produced from the wells.




Working
      interest on a “Third for Quarter Basis”: The non-operator usually will pay all
      costs attributable to restoring the well or wells to production and will own
      75%
      of the working interest in the well or wells; The operator receives the
      remaining 25% working interest as a free carried working interest.




Recompletion:
      The completion for production of an existing well bore in another formation
      from
      that in which the well has been previously completed.




Severance: The
      owner of all rights to a tract of land (vertically or horizontally). In
      horizontal severance, for example, if he chooses to sell all or part of
      the mineral rights, two distinct estates are
      created: the surface rights to the tract of land and the mineral
      rights to the same tract. The two estates may change hands independently of
      each other. Severed mineral rights may be restricted as to mineral type, or
      limited by depth, in which case the landowner retains the rights to minerals
      other than those severed, and to depth intervals other than those severed.




Workover:
      Operations on a producing well to restore or increase production. A workover
      may
      be performed to stimulate the well, remove sand or wax from the wellbore, to
      mechanically repair the well, or for other reasons.




The
      Company may participate in the drilling of a well or wells if it is able to
      successfully acquire attractive oil and gas leases with substantially proven
      undeveloped reserves, a preferred majority or suitable working interest being
      available, and can obtain or provide financing or market an interest on terms
      acceptable to the Company.




**Oil
      and Gas Properties, Leases, and Interests**




***Knox
      County, Texas***




The
      Company owns an interest in 38 oil wells located in Knox County, Texas, known
      as
      the Fant Ranch Unit. Of the 38 oil wells, approximately 20 are currently
      producing, 6 are injection wells, and 12 are shut in –temporarily abandoned. The
      Company attempts to maintain all of its operating wells in good working
      condition. Our contract operator, familiar with the oil and gas business in
      the
      area, contracts pumper(s) to oversee wells and interests owned by the Company.




The
      Knox
      County, Texas wells, properties and interests held by the Company are included
      as security for promissory notes, and debenture agreements held by Dutchess
      Private Equities Fund, LTD (“Dutchess”).  All liens and encumbrances are
      discussed later in this section.




The
      Company owns a majority working and net revenue interest in oil properties,
      which includes unitized lease(s), equipment, oil wells and injection wells
      set
      up for production of these interests in proved developed producing oil reserves,
      with revenues.


16




The
      following table details the interests of the Company in the Fant Ranch Unit
      and
      all wells are located in Knox County, Texas.


**Well**
              
              **Lease**
              
              **Well Names**
              
              
              
              **Working**
              
              **Net Revenue****Count**
              
              **Name**
              
              **Under Leases**
              
              **County**
              
              **Interest (%)**
              
              **Interest (%)**
              
              **Status**1
              
              
              Fant
                  Tract 1
              
              
              1-2
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              32
              
              
              Fant
                  Tract 1
              
              
              1-3
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              13
              
              
              Fant
                  Tract 1
              
              
              1-4
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              14
              
              
              Fant
                  Tract 1
              
              
              1-5
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              15
              
              
              Fant
                  Tract 1
              
              
              1-6
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              36
              
              
              Fant
                  Tract 2
              
              
              2-1
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              17
              
              
              Fant
                  Tract 2
              
              
              2-3
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              18
              
              
              Fant
                  Tract 2
              
              
              2-4
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              39
              
              
              Fant
                  Tract 2
              
              
              2-5
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              210
              
              
              Fant
                  Tract 3
              
              
              3-2
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              211
              
              
              Fant
                  Tract 5
              
              
              5-1
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              112
              
              
              Fant
                  Tract 5
              
              
              5-2
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              113
              
              
              Fant
                  Tract 5
              
              
              5-3
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              114
              
              
              Fant
                  Tract 5
              
              
              5-4
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              215
              
              
              Fant
                  Tract 5
              
              
              5-5
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              216
              
              
              Fant
                  Tract 5
              
              
              5-6
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              317
              
              
              Fant
                  Tract 5
              
              
              5-7
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              118
              
              
              Fant
                  Tract 6
              
              
              6-1
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              219
              
              
              Fant
                  Tract 6
              
              
              6-2
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              120
              
              
              Fant
                  Tract 6
              
              
              6-3
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              221
              
              
              Fant
                  Tract 6
              
              
              6-4
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              122
              
              
              Fant
                  Tract 6
              
              
              6-5
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              323
              
              
              Fant
                  Tract 6
              
              
              6-7
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              124
              
              
              Fant
                  Tract 6
              
              
              6-8
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              225
              
              
              Fant
                  Tract 7
              
              
              7-1
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              126
              
              
              Fant
                  Tract 7
              
              
              7-2
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              327
              
              
              Fant
                  Tract 7
              
              
              7-3
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              128
              
              
              Fant
                  Tract 7
              
              
              7-4
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              229
              
              
              Fant
                  Tract 7
              
              
              7-5
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              130
              
              
              Fant
                  Tract 7
              
              
              7-6
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              231
              
              
              Fant
                  Tract 7
              
              
              7-7
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              132
              
              
              Fant
                  Tract 7
              
              
              7-8
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              233
              
              
              Fant
                  Tract 7
              
              
              7-9
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              234
              
              
              Fant
                  Tract 10
              
              
              10-1
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              135
              
              
              Fant
                  Tract 10
              
              
              10-2
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              136
              
              
              Fant
                  Tract 11
              
              
              11-1
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              137
              
              
              Fant
                  Tract 11
              
              
              11-2
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              238
              
              
              Fant
                  Tract 12
              
              
              12-3
              
              
              Knox
              
              
              100
              %
              
              75
              %
              
              1





Status





1.
      Active
      and or Productive Wells =20


2.
      Shut
      In -Temporarily Abandoned =12


3.
      Injection Well =6




A
      mineral
      interest is the ownership of rights to gas, oil, or other minerals as they
      naturally occur in place, at or below the surface of a tract of land. Ownership
      of the minerals carries with it the right to make such reasonable use of the
      surface as may be necessary to explore for and produce the minerals. Only the
      mineral owner (or fee owner) may execute an oil or gas lease conveying his
      interest in a tract of land.  Severance:  The owner of all rights to a
      tract of land (vertically or horizontally).  In horizontal severance, for
      example, if he chooses to sell all or part of the mineral rights, two distinct
      estates are created:  the surface rights to the tract of land and the
      mineral rights to the same tract.  The two estates may change hands
      independently of each other.


17




Severed
      minerals rights may be restricted as to mineral type, or limited by depth,
      (in
      which case the landowner retains the rights to minerals other than those
      severed, and to depth intervals other than those severed.)




The
      table
      above is the Company’s current interest in the leased wells and equipment that
      principally produce our revenues from the production of oil, and is not all
      inclusive of our interests in the properties.  The interests are subject to
      a security interest held by Dutchess.




The
      Company attempts to maintain all of its operating wells in good working
      condition. Success Oil Co., Inc., a Texas corporation, operator license number
      828326 is familiar with the oil and gas business in the area. Success operates
      the Company's interests in the properties overseeing production and maintenance
      activities for its oil wells, equipment and other development activities for
      the
      leases.




The
      Material terms of the Operating Agreement with the Company include:




Success
      is an independent contractor and operates the subject properties on a contract
      basis for a monthly overhead fee of $250.00 per well (presently for 20 wells).
       All other charges whether by Success, an affiliate of Success or third
      parties will be the responsibility of the working interest owners of the
      properties. Either party may elect to cancel the agreement upon 30-day written
      notice to the other party.




Success
      Oil Co., Inc. furnishes the monthly Lease Operation Expense and various activity
      reports to the Company via its wholly owned subsidiary Firecreek.  The run
      checks sent to the operator represent monthly payments due for the production
      of
      oil BML has received.  Success administrates monthly activities, and after
      payment of management, consulting, and lease-operating expenses (LOE's), it
      collects and compiles the Joint Interest Billing (JIB) Statements and certain
      reports and financial statements related to production income and expenses
      for
      monthly delivery to Company’s accounting for compilation.




As
      previously stated herein, the Company invested approximately $1.5 million on
      July 9, 2007 toward purchase of its 100% working interests in Fant Ranch Unit
      from Ward. In addition to the purchase price, the Company also purchased oil
      in
      the tanks in the amount of $38,705. Of the $1.5 million acquisition costs
      $906,350 was attributed to the equipment, and $593,650 was attributed to the
      unit lease.




During
      the Year Ended 2007, the Company’s expenditures for Fant including repair and
      reinstatement of two no.’s 7-1 and 1-4 wells totaled $46,172.




Funding
      for the Company’s interests purchased in 2007 including workover and other
      related costs for the Fant were obtained from Dutchess Private Equities Fund,
      LTD (“Dutchess”) in the form of a Debenture, and further secured by the Assets
      of the Company. Additional terms for finance required 12% compound interest
      payable monthly (approximately $20,000), along with 20% of the production
      revenue net of operations expense, royalties, and taxes, and of other revenue
      of
      the Company, also due on a monthly basis.




***Description
      of Lands and Leases:***




**FANT
      RANCH UNIT TRACT #1:**




320
      acres, M/L, described as the southwest half (SW/2) out of a 640 acre tract,
      M/L,
      in the Washington County RR Co. Survey #2 (A-1364), Knox County, Texas.
 Being the same 320 acre tract described in Oil & Gas Lease from Mrs.
      Louise McFarland, et al, to Texas Pacific Oil Co. Inc. DTD 5/23/80 and recorded
      in Volume 198, Page 699 of the Deed Records of Knox County, Texas.




**FANT
      RANCH UNIT TRACT #2:**




320
      acres, M/L, described as the northeast half (NE/2) out of a 640 acre tract,
      M/L,
      in the Washington County RR Co. Survey #2 (A-1364), Knox County, Texas.
 Being the same 320 acre tract described in Oil & Gas Lease from Mrs.
      Louise McFarland, et al, to Texas Pacific Oil Co. Inc. DTD 5/23/80 and recorded
      in Volume 198, Page 699 of the Deed Records of Knox County,
      Texas.


18


**FANT
      RANCH UNIT TRACT #3:**




160
      acres, M/L, out of a 640 acre tract, M/L, said 640 tract being all of the
      Indianola RR Co. Survey #55, Blk Z, (A-558), Knox County, Texas.  Being the
      same 640 acre tract described in Oil & Gas Lease from John P. Callahan, et
      ux, to Texas Pacific Oil Co. Inc. DTD 5/20/80 and recorded in Volume 199, Page
      199 of the Deed Records of Knox County, Texas.




**FANT
      RANCH UNIT TRACT #4:**




220
      acres, M/L, out of the NE/2 of a 640 acre tract, M/L, said 640 acre tract being
      all of the T. M. Adams Survey #56, Block Z, (A-1367), Knox County, Texas, and
      being the same 640 acre tract described as the first tract in the Oil & Gas
      Lease from Ladd Petroleum Corporation to Texas Pacific Oil Co. Inc. DTD 1/30/80
      and recorded in Volume 196, Page 727 of the Deed Records of Knox County,
      Texas.




**FANT
      RANCH UNIT TRACT #5:**




320
      acres, M/L, described as the southwest half (SW/2) out of a 640 acre tract
      being
      all of the T. M. Adams Survey #56, Block Z, (A-1367), Knox County, Texas, and
      being the same 640 acre tract described as the first tract in the Oil & Gas
      Lease from Ladd Petroleum Corporation to Texas Pacific Oil Co. Inc. DTD 1/30/80
      and recorded in Volume 196, Page 727 of the Deed Records of Knox County,
      Texas.




**FANT
      RANCH UNIT TRACT #6:**




320
      acres, M/L, described as the northeast half (NE/2) in the John H. Gibson Survey
      #57, Certificate No. 290, Block Z, (A-556), Knox County, Texas, and being the
      same 320 acre tract described in the Oil & Gas Lease from Martin Properties,
      a Partnership, et al, to Texas Pacific Oil Co. Inc. DTD 5/19/80 and recorded
      in
      Volume 199, Page 211 of the Deed Records of Knox County, Texas.




**FANT
      RANCH UNIT TRACT #7:**




320
      acres, M/L, described as the southwest half (SW/2) in the John H. Gibson Survey
      #57, Certificate No. 290, Block Z, (A-556), Knox County, Texas, and being the
      same 320 acre tract described in the Oil & Gas Lease from Martin Properties,
      a Partnership, et al, to Texas Pacific Oil Co. Inc. DTD 5/19/80 and recorded
      in
      Volume 199, Page 211 of the Deed Records of Knox County, Texas.




**FANT
      RANCH UNIT TRACT #8:**




160
      acres, M/L, out of a 640 acre tract, M/L, said 640 acre tract being all of
      the
      G. C. and S. F. Ry. Co. Survey #8, Certificate No. 2/328, (A-1366), Knox County,
      Texas, and being the same 640 acre tract described in the Oil & Gas Lease
      from Lewis E. Lyles and Earl J. Lyles to Texas Pacific Oil Co. Inc. DTD 9/27/79
      and recorded in Volume 196, Page 279 of the Deed Records of Knox County,
      Texas.




**FANT
      RANCH UNIT TRACT #9:**




40
      acres,
      M/L, out of a 320 acre tract, M/L, in the Indianola RR Co. Survey, Section
      #59
      (A-986), Block Z, Knox County, Texas, said tract being described in Oil &
Gas Lease from Ralph E. Bullington, et al, to Sun Exploration and Production
      Company, dated June 14, 1982, recorded in Volume 210, Page 721, and amended
      in
      Lease Extension dated February 19, 1984, of the Deed Records of Knox County,
      Texas.




**FANT
      RANCH UNIT TRACT #10:**




160
      acres, M/L, described as SW/2 of the SW/2 out of a 640-acre tract, M/L, said
      640
      acre tract being all of the T. M. Adams Survey #58, (A-1365), Block Z, Knox
      County, Texas, and referenced as the second tract in Oil & Gas Lease
      hereinabove described in Unit Tract 4.




**FANT
      RANCH UNIT TRACT #11:**




160
      acres, M/L, described as the SE/2 of the NE/2 out of a 640-acre tract, M/L,
      said
      640 acre tract being all of the T. M. Adams Survey #58, (A-1365), Block Z,
      Knox
      County, Texas, and referenced as the second tract in Oil & Gas Lease
      hereinabove described in Unit Tract 4.




**FANT
      RANCH UNIT TRACT #12:**




40
      acres,
      M/L, in the form of a square, out of the W. G. Scales Survey, (A-665), Knox
      County, Texas, described by metes and bounds as follows:


19


Beginning
      at the Southwest corner of the W. G. Scales Survey (A-665), also being where
      the
      Southeast corner of the T. M. Adams Survey, (A-1365), the T. M. Adams Survey
      (A-1367), and the J. H. Gibson Survey, (A-556), intersect with said Scales
      Survey; thence in a Northwesterly direction with said Scales and said T. M.
      Adams Survey lines 1300 feet to a point for corner; thence Northeast 1300 feet,
      running parallel with the Scales and the T. M. Adams Survey lines, to a point
      for corner; thence Southeast 1300 feet to a point for corner in the Scales
      and
      the T. M. Adams Survey line; thence Southwesterly 1300 feet along said Scales
      and said T. M. Adams Survey line to the place of the beginning.




***Proved
      Reserves –Fant***




The
      following table sets forth the estimated total proved developed producing,
      oil
      reserves, net to the Company’s interest. The reserve information is based on
      excerpts of the independent report prepared by Williamson Petroleum Consultants,
      Inc., P.E. #21492.  The engineering evaluation was performed to estimate
      proved developed producing reserves and future net revenue from the Fant Ranch
      Unit to the subject interests. This evaluation was authorized by EGPI Firecreek,
      Inc. (Firecreek). NYMEX spot prices were subtracted from the lease wellhead
      prices obtained from Firecreek for the most recent 12-month period to determine
      lease price differentials.




These
      lease differentials were used with the December 31, 2007 NYMEX spot price of
      $96.01 to determine the effective date price. After the effective date, prices
      were held constant for the life of the property. The projection of the reserves
      and future net revenue to the evaluated interests were based on economic
      parameters and operating conditions considered applicable as of December 31,
      2007. Following is a summary of the results of the evaluation effective December
      31, 2007:




The
      following reflects the Company’s Net Revenue Interests net of estimated future
      income taxes:


**PROVED DEVELOPED**
                **PRODUCING**Net
                  Reserves to the
                Evaluated
                  Interests:Oil
                  Condensate, MBBL
              
              
              64.709Future
                  Net Revenue, M$:
                Undiscounted
              
              $
              2,027,098Discounted
                  Per Annum
                at
                  10.00 Percent
              
              $
              1,418,360




It
      should
      be emphasized that with the current economic uncertainties, fluctuation in
      market conditions could significantly change the economics of the property
      included in this report. Firecreek provided six months of operating cost data
      beginning with their purchase of the property in July 2007. Over this period
      a
      program to return the property to full production status resulted in higher
      operating expenses which are projected to continue through December 2008.
      Beginning January 2009 costs were expected to stabilize at reduced levels
      estimated by the certified petroleum engineer after discussion with Firecreek
      and the operator. After January 2009, costs were held constant for the remaining
      life of the property. State production taxes and average county ad valorem
      taxes
      have been deducted at the published rates for Texas as appropriate. Based on
      information supplied by Firecreek, capital costs were not included in the
      projection of reserves and economics in this evaluation.




There
      are
      numerous uncertainties inherent in estimating quantities of proved reserves.
      The
      reserves and reservoir predictions are estimates only. There are numerous
      uncertainties in the estimation of interpretation parameters, including factors
      such as product prices, product demand, subsurface heterogeneities, and other
      variables, that are beyond the control of the authors of the report as well
      as
      the owners of the subject properties. The estimates in the appraisal are based
      on various assumptions relating to rates of future production, timing and amount
      of development expenditures, oil and gas prices, and the results of planned
      development work. Actual future production rates and volumes, revenues, taxes,
      operating expenses, development expenditures, and quantities of recoverable
      oil
      and gas reserves may vary substantially form those assumed in the estimates.
      Any
      significant change in these assumptions, including changes that result from
      variances between projected and actual results, could materially and adversely
      affect future reserve estimates. In addition, such reserves may be subject
      to
      downward or upward revision based upon production history, results of future
      development, prevailing oil prices, and other factors.




Reservoir
      engineering and geological interpretation are a subjective process of estimating
      underground accumulations of oil and natural gas that cannot be measured in
      an
      exact manner. The accuracy of any reserve estimate, performance prediction,
      or
      geological analysis is a function of the quality of the available data and
      of
      engineering and geological interpretation and judgment. In addition, the impacts
      of various drilling, completion, and production practices on productivity can
      be
      estimated but not fully defined or quantified. As a result, estimates and
      analyses by different engineers and geoscientists may vary.


20




***Sweetwater
      County, Wyoming***




Through
      Firecreek, the Company owns an interest in 4 gas wells located in Sweetwater
      County, Wyoming, 2 of which were completed and went in production in
      2006 for the production of gas. A third well was completed in the first quarter
      2007. Due to technical issues, the well no. 13-9 has not yet achieved commercial
      production status, however we remain positive for future results.




The
      Company attempts to maintain all of its operating wells in
      good working condition. Our contract operator, Newport Oil Corporation
      (“Newport”) is familiar with the oil and gas business in the area and utilizes a
      contract pumper to oversee wells and interests owned by the Company.




The
      Sweetwater County, Wyoming properties and interests are secured
      by the Company’s loan and promissory notes held by Dutchess Private Equities
      Funds, through Dutchess Private Equities Fund, LP and Dutchess Private Equities
      Fund, II, LP (collectively “Dutchess”). All liens and encumbrances are
      discussed later in this section.




The
      Company owns a 50% undivided non operated interest in certain leases,
      wells, equipment, mineral interests including oil and gas reserves, and other
      rights, (the “Assets”) located in Sweetwater County, Wyoming from Newport, under
      the prospect named “Ten Mile Draw” (“TMD”). An Operating Agreement was entered
      into at the time of the Purchase, between Firecreek and Newport whereas Newport
      became operator for Firecreek’s non operated 50% interests, and Newport’s
      operated 50% interests. The Operating Agreement also provides for our mutual
      understandings pertaining to the exploration and development of two tracts
      of
      land, and additional rights and options further established therein. Also please
      see “The Business”; Firecreek’s Current Oil and Gas Operations”; “Ten Mile Draw
      Project, Sweetwater County, Wyoming”; “Future Development Contemplated, Ten Mile
      Draw Project”.




The
      Assets represent: (i) the estates and mineral rights created by oil and gas
      leases described in Exhibit “A” to the purchase agreement, insofar as they cover
      the lands described in Exhibit “A”, and all oil, gas, water disposal and other
      wells located on the lands or lands pooled therewith, together with all of
      Newport’s interest in the rights and appurtenances incident thereto; (ii) all of
      Newport’s rights in, to and under agreements relating to such lands, leases or
      wells; (iii) fixtures, personal property, facilities and equipment used or
      held
      for use or charged to such lands, leases, or wells; and (iv) all books, files,
      data and records in Newport’s possession relating to such lands, leases or
      wells, reserving to Newport the right to retain possession of the originals
      of
      such records. Further information on the Ten Mile Draw Purchase and Sale,
      Operating Agreements with Newport, and other associated Agreements per attached
      exhibits can be found in our Current Report on Form 8-K filed November 16,
      2005,
      incorporated herein by reference. The following table and (1) base map of the
      area, details the interests of the Company.




Exhibit
      “A” to the purchase agreement identified the following leases, wells, lands and
      interests relating to the Ten Mile Draw Project in Sweetwater County,
      Wyoming:




Leases:





**Lease Date**
            
            **Lessor**
            
            **Lessee**
            
            **Legal Description**2/2/1968
            
            State Of Wyoming
            
            Elaine
                Wolf
            
            Township
                21 NorthRange
                99 WestAll
                of section 166/30/1972
            
            Champlin Petroleum Company
            
            AMOCO Petroleum Company
            
            Township
                21 NorthRange
                99 WestSouth
                half of section 9




Wells:




**Field**
            
            **Well Name**
            
            **API Number**
            
            **Location**Ten Mile Draw
            
            AMOCO Champlin 1-15
            
            49-037-20999
            
            T21N-R99W-15-CE/2NWSWTen
                Mile Draw
            
            State
                68-15600 7-16
            
            49-037-20511
            
            T21N-R99W-16-NWSWNETen
                Mile Draw
            
            State
                68-15600 16-1
            
            49-037-20311
            
            T21N-R99W-16-SWSWTen
                Mile Draw
            
            UPR
                13-9
            
            49-037-20351
            
            T21N-R99W-9-CSWSW




21





Acreage
      Under First Right of Refusal:





**Lease Date**
            
            **Lessor**
            
            **Lessee**
            
            **Legal Description**1/28/1978
            
            USA W-53458
            
            Texas Gas Exploration Corporation
            
            Township 20 NorthRange
                99 WestAll
                of section 206/30/1972
            
            Champlin Petroleum Company
            
            AMOCO Petroleum Company
            
            Township
                21 NorthRange
                99 West:Section
                07: W/2, SE/4Section
                15: W/2, SE/4Section
                17: W/2, SE/4Section
                21: W/2, SE/4Section
                23: W/2, SE/4Section
                27: W/2, SE/4




At
      the
      closing of the purchase of such 50% undivided interest in the above-described
      Assets, Firecreek and Newport entered into an Operating Agreement (“Operating
      Agreement”), dated effective November 15, 2005, covering the oil and gas leases
      and interests described above. Under the Operating Agreement, Newport is the
      operator of the Ten Mile Draw Project and Firecreek is the non-operator. The
      Operating Agreement provides that unless changed by other provisions of the
      Operating Agreement, costs and liabilities incurred in operations under the
      Operating Agreement are borne and paid by the parties, and equipment and
      materials acquired in operations are owned, by the parties, as their interests
      are identified in the Operating Agreement, being 50% for Firecreek and 50%
      for
      Newport. The operator, Newport, will also charge a monthly overhead fee of
      $500.00 per producing well. Under the Operating Agreement, Newport furnishes
      the
      monthly Lease Operation Expense and activity reports to the Company, acting
      in
      capacities as Manager and consultant. Newport coordinates with
      Company management for oversight and decision making on
      important items related to gas production, workover and or development
      activities. Newport will administrate the Company’s monthly run checks
      from Western Gas Resources, Inc. Newport will collect and process the run
      checks representing the monthly payments due for the production of gas
      related to the Company and Newport’s interests. Newport administrates
      monthly payments and activities including revenue received to be paid for
      the Company’s gas production income relative to our interests in the properties,
      and will include accounting for lease operating expenses (LOE’s), collecting and
      compiling Joint Interest Billing (JIB) statements and certain reports and
      financial statements related to production income and expenses for monthly
      delivery to the Company’s accounting personnel. The Operating Agreement is in
      perpetuity, unless generally speaking, the business is wound up or down, or
      other triggering events transpire, as defined by the terms therein listed in
      the
      Operating Agreement. The Company may elect to cancel the agreement for good
      cause, or Newport may cancel the Agreement upon 30 day written notice to the
      Company.




The
      Operating Agreement additionally provides for the duties and obligations of
      the
      operator and the obligations of Firecreek as the non-operator with respect
      to
      the funding of certain workover and drilling operations. The workover
      obligations relate to three existing wells: (i) State 68-15600 7-16 (the “7-16
      Well”); (ii) State 68-15600 16-1 (the “16-1 Well”); and (iii) UPR 13-9 (the
“13-9 Well”). The fourth well covered by Exhibit “A” to the purchase agreement,
“AMOCO Champlin 1-15”, is non-productive at present and will be shut
      in.




With
      respect to the three workover wells, Firecreek and Newport are each responsible
      for 50% of the workover costs and fixed assets and have 50% of the working
      interest. As to the 7-16 Well and the 16-1 Well, each of Firecreek and Newport
      contributed the sum of $614,129.50 (total of $1,228,259) pursuant to the initial
      AFE for workover at and fixed assets the time of closing, with the
      acknowledgment that the initial AFE was only an estimate of workover costs
      for
      those two wells and each party is liable for 50% of all costs attributable
      to
      workover of those wells. Regarding the 13-9 Well, located in Section 9 of
      Township 21 North, Range 99 West, 6 th Prime
      Meridian; Effective June 30, 2006, the Company, Firecreek, and Newport entered
      into an Addendum Agreement pursuant to Article III Section 3.1 sub section
      B, of
      the Purchase and Sale Agreement, and Article VI, A. 1, paragraph three of the
      and Operating Agreement dated November 10 and November 15, 2005, respectively.
      The Company, Firecreek, and Newport reached a mutual satisfactory resolution
      regarding certain third party overriding royalties, conversion rights, and
      interests held in a certain 320 acre tract containing a third well which
      Firecreek and Newport would commence with the workover program on the 13-9
      well
      (referred to as well “UPRR Patented 13-9”). During Fiscal Year Ended 2006,
      Firecreek incurred an additional $524,969 toward workover related costs
      attributable to the 16-1, 7-16 and 13-9 wells, and for the Fiscal Year Ended
      2007, incurred an additional $74,564 toward additional costs related to the
      13-9
      well.




22





With
      respect to the two workover wells in Section 16, Township 21 (the 7-16 Well
      and
      the 16-1 Well), the total 100% working interest is subject to: (i) a royalty
      interest of 12.5%; and (ii) an overriding royalty interest of 5.00%. The total
      net revenue interest is therefore 100% minus 17.5% or 82.50%, and Firecreek
      has
      one-half of this or 41.25%.




With
      respect to the 13-9 Well, located in Section 9 of Township 21 North, Range
      99
      West, 6th Prime Meridian, the total 100% working interest is subject to: (i)
      a
      royalty interest of 15%, and (ii) an overriding royalty interest of 5.00%.
      The
      total net revenue interest is therefore 100% minus 20.0% or 80.00%, and
      Firecreek has one-half of this or 40.00%. The working interest in this well
      is
      further subject to the terms of a recently executed Farm Out agreement between
      a
      third party and Newport.




The
      Operating Agreement contemplates drilling additional wells in Section 16,
      Township 21 North, Range 99 West, 6th Prime Meridian, and four to six wells
      on
      other land subject to the Operating Agreement. With respect to new wells,
      Newport will prepare proposed drilling programs and submit those to Firecreek
      for review.




Newport
      will formally offer to Firecreek the opportunity to participate in new wells
      and
      Firecreek will have fifteen days to elect to “participate” or “not participate”
in such wells. If Firecreek elects to “not participate”, it will lose all rights
      to participate in future wells. Newport, as the operator, is responsible for
      the
      management of the development program and will determine the parameters, timing,
      and direction of further drilling.




To
      secure
      its obligations under the Operating Agreement, each party granted to the other
      a
      lien on any interest it owns or acquires in leases and interests in the area
      subject to the Operating Agreement, and a security interest and/or purchase
      money security interest in any interest it owns or acquires in personal property
      and fixtures on or used in connection therewith, to secure performance of its
      obligations under the Operating Agreement.




Each
      of
      the parties may sell its interest under the Operating Agreement provided the
      entire interest of the party is sold, or as mutually agreeable by the parties
      from time to time in writing.




The
      Company attempts to maintain all of its operating wells in
      good working condition. Newport, based in Clearwater, FL, is familiar with
      the oil and gas business and interests located in Sweetwater County, Wyoming.
      Newport operates the Company’s interests in the properties, further utilizing a
      contract pumper in the area who oversees production and maintenance activities
      for the wells, equipment, and other development activities for the leases.




***Financing
      Related To Our Oil and Gas Interests Located In Sweetwater County,
      Wyoming***




The
      wells
      and interests listed above are secured and encumbered by notes to Dutchess.
      Information on the Dutchess Agreements, the Ten Mile Draw Purchase and Sale
      with
      Newport, and attached additional exhibits can be found in our Current Reports
      on
      Form 8-K filed April 27, 2006, July 7, 2006, and November 16, 2005, and in
      “Notes To Financial Statements” Note 12, Issuance of Convertible Debentures,
      incorporated herein by reference.




The
      Company paid cash of approximately $1.1 million on November 14, 2005 toward
      purchase of its interests and initial Phase 1 development in the Ten Mile Draw
      project. Of the $1.1 million, $601,000 were paid for the assets, and $488,130
      plus other title and miscellaneous costs pursuant to the initial AFE estimate
      for workover for our share of the first two wells at the time of closing
      pursuant to the terms of the Purchase and Operating Agreements with Newport.




General
      Terms for the three Dutchess notes for Fiscal Year Ended December 31, 2006,
      and
      2005:




Original
      face value principal amount notes in the amount of $6,272,750 secured by the
      Company’s interests related to its assets and interests in the subject
      properties located in Sweetwater County, Wyoming, and from each Put tendered
      pursuant to that certain Investment Agreement, as amended, dated August 23,
      2005, between the Company and Dutchess. There are no due on sale provisions
      for
      the notes (See also section on “Liquidity and Capital Resources”, and
“Notes To Financial Statements” Note 10, Equity Credit Line, incorporated herein
      by reference).




***Exploration
      and Production***




The Company did
      not participate in the drilling of a well
      or wells since May/June of 2000 through 2002. The Company, in addition
      to its present plans contemplated for the Ten Mile Draw, may participate in
      the
      drilling of a well or wells if it is able to successfully acquire attractive
      oil
      and gas leases with substantially proven undeveloped reserves, a preferred
      majority, or suitable working interest being available, and can obtain or
      provide financing or market an interest on terms acceptable to the
      Company . (Please
      also see section on Recent Developments, at the beginning of this
      Report)


23




***Proved
      Reserves -TMD***




The
      following table sets forth the estimated total proved developed producing,
      and
      total proved undeveloped oil and gas for Net Quantity reserves, owned by the
      Company’s wholly owned subsidiary Firecreek. This analysis was performed in a
      professional manner using customary and accepted petroleum engineering and
      geological practices and techniques. The analysis is valid for the data provided
      to the authors of the report (listed below), representing a true and accurate
      assessment of the Proven Developed Reserves, the Proven Undeveloped Reserves,
      for the interests held by Firecreek in the south half of Section 9 and all
      of
      Section 16, Township 21 North, Range 99 West, as outlined in the report. The
      following reserve information is based on excerpts of the independent
      engineering and geological report prepared by Michael T. Borah (Wyoming PE
      No.
      5107) and Lynette D. W. George (Wyoming PG No. 1004), respectively, at the
      request of the Company. Natural Gas prices for the various economic analyses
      were based on the actual gas purchase statements from Western Gas for December
      2007: $7.773 per Mcf for the State 7-16 well, and $6.483 per Mcf for the
      Continental Divide 16-1 well. Prices were adjusted for a BTU content of each
      zone as well as the liquids revenue received. These prices were utilized for
      all
      economics performed for this report.




The
      Company’s net reserves and Net Present Value are listed below for the subject
      acreage, based on the appropriate category and effective January 1, 2007. These
      reflect the Company’s Net Revenue Interests net of estimated future income
      taxes:




**Proven Developed**
            
            **Proven Undeveloped**Lewis/ Almond
            
            312,189
                Mcf
            
            0Almond
            
            
            
            717,011
                Mcf





Proven
                Developed
            Net
                Present Value (10%) = $475,099Proven
                Undeveloped
            Net
                Present Value (10%) = $1,143,812Total
                Proven Reserves:
            1,029,200
                McfTotal
                Net Present Value:
            $1,414,703





Newport
                Oil Corporation is the Operator.





(1)




The
      reserves assigned to the properties in the evaluation were determined by
      analyzing current test data, extrapolating historical production data, and
      comparing field data with the production history of similar wells in the area.
      The current volatility of oil and gas prices provides and element of uncertainty
      to any estimates. If prices should vary significantly from those projected
      in
      the appraisal, the resulting values would change substantially. The reserve
      estimates contained in the engineering and geological report are based on
      accepted engineering and evaluation principles. The present value of estimated
      future net revenues, discounted at 10% does not necessarily represent an
      estimate of fair market value for the evaluated properties.




There
      are
      numerous uncertainties inherent in estimating quantities of proved reserves.
      The
      reserves and reservoir predictions are estimates only. There are numerous
      uncertainties in the estimation of interpretation parameters, including factors
      such as product prices, product demand, subsurface heterogeneities, and other
      variables, that are beyond the control of the authors of the report as well
      as
      the owners of the subject properties. The estimates in the appraisal are based
      on various assumptions relating to rates of future production, timing and amount
      of development expenditures, oil and gas prices, and the results of planned
      development work. Actual future production rates and volumes, revenues, taxes,
      operating expenses, development expenditures, and quantities of recoverable
      oil
      and gas reserves may vary substantially form those assumed in the estimates.
      Any
      significant change in these assumptions, including changes that result from
      variances between projected and actual results, could materially and adversely
      affect future reserve estimates. In addition, such reserves may be subject
      to
      downward or upward revision based upon production history, results of future
      development, prevailing oil prices, and other factors.




Reservoir
      engineering and geological interpretation are a subjective process of estimating
      underground accumulations of oil and natural gas that cannot be measured in
      an
      exact manner. The accuracy of any reserve estimate, performance prediction,
      or
      geological analysis is a function of the quality of the available data and
      of
      engineering and geological interpretation and judgment. In addition, the impacts
      of various drilling, completion, and production practices on productivity can
      be
      estimated but not fully defined or quantified. As a result, estimates and
      analyses by different engineers and geoscientists may vary.




24


The
      actual amount of the Company’s proved reserves is dependent on the prevailing
      price for oil, which is beyond the Company’s control of influence. World oil
      prices declined significantly during 1997 and 1998 from previous years and
      increased significantly during years 1999 and 2000. In 2001 and 2002 prices
      again have been extremely volatile. In 2003, 2004, and 2005, 2006, the futures
      market reported unprecedented natural gas and crude oil price, along with
      increasing volatility in 2006 and 2007. There can be no assurance that oil/gas
      prices will decline or increase in the future. Oil and gas prices have been
      and
      are likely to continue to be volatile and subject to wide fluctuations in
      response to any of the following factors: relatively minor changes in the supply
      of and demand for oil and gas; market uncertainty; political conditions in
      international oil producing regions; fear of war, or non fear of war; the extent
      of domestic production and importation of oil; the level of consumer demand;
      weather conditions; the competitive position of oil as a source of energy as
      compared with natural gas, coal, nuclear energy, hydroelectric power, and other
      energy sources; the refining capacity of prospective oil purchasers; national
      inventory levels; the effect of federal and state regulation on the production,
      transportation and sale of oil; and other factors all of which are beyond the
      control or influence of the Company.




**Wells
      And Acreage**




In
      the
      oil and gas industry and as used herein, the word “gross” well or acre is a well
      or acre in which a working interest is owned; the number of gross
      wells is the total number of wells in which a working interest is owned. A
“net” well or
 acre is deemed to exist when the sum
      of fractional ownership working interests in gross wells or
      acres equals one. The number of net wells or acres is the sum of the fractional
      working interests owned in gross wells or acres.




Set
      fourth below is information respecting the developed and undeveloped acreage
      owned by the Company in Knox County, Texas, and Sweetwater County, Wyoming
      as of
      December 31, 2007:




**Developed Acreage**
            
            **Undeveloped Acreage****Gross**
            
            **Net**
            
            **Gross**
            
            **Net**Sweetwater
                County, Wyoming
            
            
            320
            
            
            160
            
            
            960
            
            
            360Knox
                County, Texas
            
            
            2520
            
            
            1890
            
            
            -0-
            
            
            -0-Total
            
            
            2840
            
            
            2045
            
            
            960
            
            
            360




**Production
      And Sale Of Oil And Gas**




PRODUCTION
      AND SALE OF OIL AND GAS




The
      following table summarizes certain information relating to the Company's net
      Natural oil and natural gas produced and from the Company’s property interests
      held, after royalties, during the periods indicated. The Company did not produce
      any oil for the fiscal period ended December 31, 2006:




**Year
                Ended December 31,****2007**
            
            **2006**Average
                net daily production of oil (Bbl)
            
            
            22.56
            
            
            -0-Average
                net daily production of gas (Mcf)
            
            
            73.79
            
            
            *95Average
                sales price of oil ($ per Bbl)
            
            $
            81.73
            
            
            -0-Average
                sales price of gas ($ per Mcf)
            
            
            5.02
            
            $
            5.41Average
                lifting cost per bbl oil equiv.
            
            $
            26.52
            
            $
            13.82





*Calculations
      for 2006 Average net daily production of gas (Mcf) was based on partial year
      start up activity averages.





Out
      Corporate offices are located in Scottsdale, Arizona, and our wholly-owned
      subsidiary Firecreek Petroleum, maintained an office in Fort Worth, Texas,
      but
      moved its operations primarily to Scottsdale, Arizona during second quarter
      of
      operations in 2006.




The
      Company had an operating lease for office space in Fort Worth, Texas. Rent
      expense for fiscal year 2007 and 2006 was $35,260 and $84,631, respectively.
      (See also additional discussion and information contained in Item 3, Legal
      Proceedings included in this Report listed under the title Legal Proceedings,
      Texas Litigation, Hickman Investments, Ltd.)


25




The
      Chief
      Executive Officer of the Company provided corporate office space through 2004
      at
      no charge. During the last quarter of 2005, the Company paid $5,132 for
      approximately 1,431 square feet of office space utilized for its headquarters
      located at 6564 Smoke Tree Lane, Scottsdale, Arizona 85253. There is no further
      agreement in place to pay for the premises. At December 31, 2007 and 2006,
      the
      premises continue to be provided free of charge. Please see “Certain
      Relationships and Related Transactions”.




**ITEM
              3.**
            **LEGAL
                PROCEEDINGS**




**Texas
      Litigation**




***Hickman
      Investments, Ltd.***




On
      July
      23, 2007, the Company received notice from the Secretary of State of Texas
      that
      Hickman Investments, Ltd. (“Hickman”) filed a Plaintiff’s First Amended Orginal
      Petition against the Company’s wholly-owned subsidiary Fircreek Petroleum, Inc.
      (“FPI”),, in Tarrant County, Texas (Cause No. 06-048109-3) seeking judgment
      against FPI for breach of lease, foreclosure of Hickman’s liens on FPI’s
      property, attorney’s fees, cost of court, pre-judgment interest, and interest on
      the judgment from date until paid (the “Hickman Petition”).  The Company
      strongly believes that the Hickman Petition is wholly unmeritorious and
      procedurally flawed. The Company will vigorously challenge and defend against
      all claims contained in the Hickman Petition. With respect to the matters in
      the
      filing: on August 9, 2007, the Company filed a general denial with the Tarrant
      County Court At Law, with the matter then held in abeyance pending further
      clarifications and discussions. In March 2008 the Company received request
      for
      interrogatories and is in preparation for an upcoming mediation hearing. (Please
      also see information contained in Form 8-K filed on July 27, 2007, incorporated
      herein by reference.)




**New
      York Litigation**




***Star
      Energy Corp. Transaction Background***




As
      previously reported by EGPI Firecreek, Inc. in its Current Report on Form 8-K,
      dated August 9, 2007, the Company through Firecreek entered into a Letter
      Agreement with Star Energy Corp. (“Star”) relating to the purchase and sale of
      all of the Company’s rights to and interest in certain projects in Ukraine (the
“Agreement”). Such rights and interests in the Ukraine projects included, but
      were not limited to: (1) any right to acquire shares or other interests in
      any
      entities to whom licenses, permits or permissions to explore for or extract
      oil,
      natural gas or other natural resources on any territories referenced in the
      exhibits to the Agreement have been issued by any government authority having
      jurisdiction over such territories; (2) any direct right to acquire licenses,
      permits or permissions to explore for or extract oil, natural gas or other
      natural resources on any territories referenced in the exhibits to the Agreement
      issued or to be issued by any government authority having jurisdiction over
      such
      territories; (3) interests currently held by the Company in any joint ventures,
      partnerships, consortiums, or industry groups that currently have rights to
      any
      Ukraine project or any other arrangements pertaining to any Ukraine project
      in
      which the Company currently has an interest, and (4) any business opportunities
      related to the Projects.  Pursuant to the Agreement, the Company received
      2,100,000 shares of Star’s restricted Common Stock and one hundred thousand
      dollars ($100,000) in cash upon execution of the Agreement.




***Demand
      for Arbitration***




On
      February 28, 2008, the Company received a Demand for Arbitration (the “Demand”)
      from Star against the Company and Double Coin Ltd. (“Double Coin”), an entity
      co-owned in part by Mr. Rupert Johnson, a Director of the Company.  Mr.
      Johnson was retained and compensated by Star as a consultant in the transaction.
      The Demand alleges (i) the Company and Double Coin wilfully failed to cooperate
      with Star in conducting its due diligence review in connection with various
      projects  (ii) that this failure to cooperate with its due diligence review
      prevented Star from acquiring any rights and interests in the projects and
      thus
      amounts to a breach of the Agreement; (iii) that the Company and Double Coin
      breached an implied duty of good faith and fair dealing; and (iv) that the
      Company and Double Coin made misrepresentations in connection with the
      transaction.  Star seeks (i) to have the Agreement declared null and void;
      (ii) the return of the shares issued to the Company (“Company Shares”); (iii)
      the Company to return the $100,000 cash payment (“Cash Payment”).




Although
      the Company is seeking to resolve this matter in an amicable fashion, the
      Company strongly disputes the allegations and  is prepared to vigorously
      defend against the claims set forth in the Demand. Further, as stated in Section
      3(a) of the Agreement, the Company Shares and the Company Cash were irrevocably
      issued upon execution of the Agreement.




In
      March
      2008, the Company received notice for mediation of the matter, and will proceed
      accordingly.




**ITEM
              4.**
            **SUBMISSION
                OF MATTERS TO A VOTE OF SECURITY
                HOLDERS**




No
      matters were submitted to a vote of our security holders during the fourth
      quarter of 2007.




26




**PART
      II**





**ITEM
              5.**
            **MARKET
                FOR COMMON EQUITY AND RELATED STOCKHOLDER
                MATTERS**




**MARKET
      PRICE AND DIVIDENDS OF COMPANY**




The
      Company became available for quotation on the over-the-counter, NASDAQ NQB
      Pink
      Sheets initially January 20, 2000. As of March 14, 2003, the Company moved
      to
      the over-the-counter market, NASDAQ OTC Electronic Bulletin Board quotation
      medium system, and is presently dually quoted on both Pink Sheets and Bulletin
      Board. The range of high and low bid information for the shares of the Company’s
      stock for the last two complete fiscal years, as reported by the OTC Bulletin
      Board National Quotation Bureau, is set forth below. Such quotations represent
      prices between dealers, do not include retail markup, markdown or commission,
      and do not represent actual transactions.




**2008**
            
            **High**
            
            **Low**First
                Quarter
            
            $
            0.0057
            
            $
            0.0009





**Year Ended December 31, 2007**
            
            **High**
            
            **Low**First
                Quarter
            
            $
            0.087
            
            $
            0.0061Second
                Quarter
            
            
            0.076
            
            
            0.0031Third
                Quarter
            
            
            0.0064
            
            
            0.0025Fourth
                Quarter
            
            
            0.0031
            
            
            0.0007





**Year Ended December 31, 2006**
            
            **High**
            
            **Low**First
                Quarter
            
            $
            0.044
            
            $
            0.0171Second
                Quarter
            
            
            0.032
            
            
            0.0161Third
                Quarter
            
            
            0.0191
            
            
            0.0085Fourth
                Quarter
            
            
            0.0153
            
            
            0.008





As
      of
      March 31, 2008, the Company had issued and outstanding 1,184,257,619 shares
      of
      its common stock held by 2,059 holders of record, and 20,000,000 shares of
      its
      Series C preferred stock held by 1 holder of record.




There
      have been no cash dividends declared by the Company since its inception.
      Further, there are no restrictions that would limit the Company’s ability to pay
      dividends on its common equity or that would be likely to do so in the future.




**SECURITIES
      AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS.**




The
      following information is provided for the fiscal year ended December 31, 2007,
      with respect to compensation plans (including individual compensation
      arrangements) under which equity securities of the issuer are authorized for
      issuance, aggregated as follows:




(i)
            All
                compensation plans previously approved by security holders; and


(ii)
            All
                compensation plans not previously approved by security holders.


27





**Equity
      Compensation Plan Information**





**Plan category**
            
            **Number of securities  to be**
              **issued upon exercise of**
              **outstanding options,**
              **warrants and rights**
              **(a)**
            
            **Weighted average exercise**
              **price of outstanding**
              **options,**
              **warrants and rights**
              **(see footnotes)**
              **(b)(*)**
            
            **Number of securities**
              **remaining available for**
              **future**
              **issuance**
              **(c)****(i) Equity compensation
                plans**
              **approved
                by security holders (Form S-8)**2004
                Stock Incentive Plan
            
            
            2,500,000
            
            $
            0.18
            
            
            -0-2004
                Stock Incentive Plan 2
            
            
            1,400,000
            
            $
            0.09
            
            
            -0-2005
                Stock Incentive Plan (1)
            
            
            2,600,000
            
            $
            0.04
            *
            
            1,300,000Total
                for Plans Filed On Form S-8
            
            
            6,500,000
            
            $
            
            
            
            1,300,000**Equity
                compensation plans**
              **approved
                by security holders**Tirion
                Group, Inc. -Warrant (2)(5)
            
            
            2,000,000
            
            
            (5
            )
            
            -0-DLM
                Asset Management,-Warrant (2)(7)
            
            
            3,350,000
            
            $
            0.06
            
            
            3,350,000Tirion
                Group, Inc.-Warrant (7)
            
            
            3,350,000
            
            
            0.06
            
            
            3,350,000John
                R Taylor-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000William
                E. Merritt-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000George
                B. Faulder-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000Dr.
                Mousa Hawamdah-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000James
                Barker-Option (4)
            
            
            1,000,000
            
            $
            0.70
            
            
            1,000,000Charles
                Alliban-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000Dennis
                R. Alexander-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000Gregg
                Fryett-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000Peter
                Fryett-Option (4)
            
            
            2,000,000
            
            $
            0.70
            
            
            2,000,000**Equity
                compensation plans**
              **approved
                by security holders**M.
                Herzog-Option (3)
            
            
            600,000
            
            $
            0.95
            
            
            -0-(Mel
                Herzog and Charlotte Herzog TTEE UA DTD Jan 31, 1994 Herzog Revocable
                Living Trust JT Grantors)D.
                Alexander-Option (3)
            
            
            600,000
            
            $
            0.95
            
            
            -0-M.
                Alexander-Option (3)
            
            
            500,000
            
            $
            0.95
            
            
            -0-D.
                Kronenburg-Option (3)
            
            
            500,000
            
            $
            0.95
            
            
            -0-(David
                J. Kronenberg Assigned to D.J. and S.M. Kronenberg Family
                LLLP)L.
                Trapp-Option (3)
            
            
            600,000
            
            $
            0.95
            
            
            -0-T.
                Richards-Option (3)
            
            
            500,000
            
            $
            0.95
            
            
            -0-Bradley
                Ray-Option (3)
            
            
            500,000
            
            $
            0.95
            
            
            -0-Steven
                Antebi-Warrant (2)
            
            
            4,000,000
            
            $
            0.025
            
            
            -0-Sapphire
                Consultants-Warrant (2)(6)
            
            
            2,500,000
            
            $
            0.02
            
            
            2,500,000Confin
                International Inv.-Warrant (2)(6)
            
            
            3,750,000
            
            $
            0.02
            
            
            3,750,000John
                Brigandi-Warrant (2)
            
            
            625,000
            
            $
            0.02
            
            
            312,000Steven
                Antebi-Warrant (8)
            
            
            4,000,000
            
            $
            0.05
            
            
            4,000,000Joseph
                M. Vasquez (9)
            
            
            500,000
            
            $
            0.022
            
            
            500,000Joseph
                M. Vasquez (9)
            
            
            500,000
            
            $
            0.06
            
            
            500,000Joseph
                M. Vasquez (9)
            
            
            500,000
            
            $
            0.12
            
            
            500,000Total
                (1)
            
            
            41,562,000
            
            $
            0.36
            **
            
            35,762,000




28





(*)     Information
      listed for column (b) in the table above represents the exercise or strike
      price
      for each option or warrant, excluding those noted (1) and (5). The calculation
      for Column (b) note (1) is the estimated average of the closing bid prices
      on
      the effective date of issuances under the plan prior to February 9, 2005.




(**)   The
      final Total listed for column (b) in the table above represents the weighted
      average exercise price for all 2005 options and warrants listed and noted (2),
      through (9) in the table only (please see additional information listed in
      this
      Report, under Item 9. “Issuance of Warrants” located in the “Notes to the
      Consolidated Financial Statements For the Years Ended December 31, 2007 and
      December 31, 2006”).




(1)
      The
      balance of shares available under the 2005 Stock Incentive Plan registered
      on
      Form S-8 are not available for further issuance after February 9, 2005 unless
      authorized, pursuant to terms of various agreements with our lenders during
      the
      year ended December 31, 2007, December 31, 2006, and December 31, 2005, and
      information has been excluded from the final Total calculations listed above
      for
      columns (a), (b), and (c) accordingly.




(2)
      The
      Company provided warrants to a lender and various consultants during 2005.
      For
      further information regarding terms of these warrants to purchase underlying
      shares of the Company’s common stock issued, please see our Registration
      Statement on Form SB-2, as amended, and incorporated herein by
      reference.




(3)
      Represents historical options issued by the Company. For further information
      regarding terms for these options, please see information furnished in our
      Form
      10-KSB, Amendment No. 3, filed on October 4, 2002, and incorporated herein
      by
      reference. As of November 30, 2007 these options have expired.




(4)
      Represents options issued by the Company as part of the Firecreek Petroleum,
      Inc. acquisition which vested, becoming available for exercise February 9,
      2005.
      For terms of these options, please see information furnished in a Current Report
      on Form 8-K/A (Amendment No. 2), filed on September 16, 2004, and incorporated
      herein by reference.




(5)
      The
      strike price for the Tirion Warrant is 80% of the average of the then lowest
      three closing bids for the previous 30 days from the date the warrants are
      exercised. For further information regarding terms of the Warrant please see
      our
      Registration Statement on Form SB-2, as amended, and incorporated herein by
      reference. As of May 19, 2007 these options have expired.




(6)
      On
      March 14, 2006 the Company notified the holders of the Warrants that they must
      exercise their Warrants for cash or the Warrants will be cancelled without
      further notice, 30 days following such notice thereof.




(7)
      Represents an assignment of 3,350,000 shares underlying Warrants held by DLM
      Asset Management, Inc. to Tirion Group, Inc. on February 14, 2006.




(8)
      Represents options issued by the Company in behalf of an extension and amendment
      of a Corporate Advisory Agreement with Steven Antebi, dated January 30, 2006.
      For further information regarding the terms of the extension and amendment
      of a
      Corporate Advisory Agreement, and corresponding option agreement please see
      a
      Current Report on Form 8-K/A, filed on February 3, 2006, incorporated herein
      by
      reference.




(9)
      Represents options issued by the Company on behalf of an Advisory Service
      Agreement with Joseph M. Vasquez dated March 1, 2006. For further information
      regarding the terms of the option agreements please see an amended Current
      Report on Form 8-K/A, filed on March 17, 2006, incorporated herein by
      reference.




**RECENT
      SALES OF UNREGISTERED SECURITIES**




On
      March
      27 and December 26 of 2007, the Company issued to Dutchess two convertible
      debentures one with a face value of $140,000 and the other with a face amount
      $500,000, to pay an incentive fee to the holder of the equity credit line.
      The
      debentures became convertible at the date of the issuances and mature in March
      27, 2012 and December 26, 2014, respectively. The Company claims an exemption
      from the registration requirements of the Securities Act of 1933, as amended
      (the “Act”) for the private placement of these securities pursuant to Section
      4(2) of the Act and/or Rule 506 of Regulation D promulgated thereunder since,
      among other things, the transaction does not involve a public offering, the
      Investor is an “accredited investor” and/or qualified institutional buyer, the
      Investor has access to information about the Company and its investment, the
      Investor will take the securities for investment and not resale, and the Company
      is taking appropriate measures to restrict the transfer of the securities.
      For
      terms of the debentures please see information furnished in our Current Reports
      and Exhibits thereto on Form 8-K filed on March 29, 2007 and January 7, 2008,
      respectively, incorporated herein by reference .




On
      June
      11, 2007 the Company issued to Dutchess a debenture in the face amount of
      $2,000,000 for acquisitions and working capital. The Debenture bears interest
      at
      12% per annum and matures on June 11, 2014. For terms of the debenture please
      see information furnished in our Current Report on Form 8-K, and Exhibits
      thereto filed on Jun 11, 2007, incorporated herein by reference.




29





On
      December 26, 2007, EGPI Firecreek, Inc. the Company issued to Dutchess a
      debenture in the face amount of $2,100,000. The Debenture bears interest at
      12%
      per annum and matures on December 26, 2014. The Company claims an exemption
      from
      the registration requirements of the Act for the private placement of these
      securities pursuant to Section 4(2) of the Act and/or Rule 506 of Regulation
      D
      promulgated thereunder since, among other things, the transaction does not
      involve a public offering, the Investor is an “accredited investor” and/or
      qualified institutional buyer, the Investor has access to information about
      the
      Company and its investment, the Investor will take the securities for investment
      and not resale, and the Company is taking appropriate measures to restrict
      the
      transfer of the securities. For terms of the debenture please see information
      furnished in our Current Report on Form 8-K, and Exhibits thereto filed on
      January 7, 2008, incorporated herein by reference.




On
      April
      21 and June 29 of 2006, the Company issued to Dutchess convertible debentures
      with a face value of $171,875 and $300,000 respectively, to pay an incentive
      fee
      to the holder of the equity credit line. The debentures became convertible
      at
      the date of the issuances and mature in April and June of 2011. The Company
      claims an exemption from the registration requirements of the Act for the
      private placement of these securities pursuant to Section 4(2) of the Act and/or
      Rule 506 of Regulation D promulgated thereunder since, among other things,
      the
      transaction does not involve a public offering, the Investor is an “accredited
      investor” and/or qualified institutional buyer, the Investor has access to
      information about the Company and its investment, the Investor will take the
      securities for investment and not resale, and the Company is taking appropriate
      measures to restrict the transfer of the securities. For terms of the debentures
      please see information furnished in Exhibit “A” to each of Exhibits 99.1 and
      99.2 to our Current Reports on Form 8-K filed on April 27, 2006 and June 7,
      2006, respectively, incorporated herein by reference .




On
      November 14 and December 15 of 2005, the Company issued to Dutchess convertible
      debentures with a face value of $375,000 and $82,500, respectively, to pay
      an
      incentive fee to the holder of the equity credit line. The debentures became
      convertible at the date of the issuances and mature in November and December
      2010. The Company claims an exemption from the registration requirements of
      the
      Act for the private placement of these securities pursuant to Section 4(2)
      of
      the Act and/or Rule 506 of Regulation D promulgated thereunder since, among
      other things, the transaction does not involve a public offering, the Investor
      is an “accredited investor” and/or qualified institutional buyer, the Investor
      has access to information about the Company and its investment, the Investor
      will take the securities for investment and not resale, and the Company is
      taking appropriate measures to restrict the transfer of the securities. For
      terms of the debentures please see information furnished in Exhibit “A” to each
      of Exhibits 10.3, and 99.1 to our Current Reports on Form 8-K filed on November
      and December 16, 2005, respectively, incorporated herein by reference.




**ITEM
              6.**
            **MANAGEMENT’S
                DISCUSSION AND ANALYSIS OR PLAN OF
                OPERATION**




**Summary
      Results Of Operations**




**Overview**




You
      should read the following discussion and analysis in conjunction with the
      audited Consolidated Financial Statements and Notes thereto, and the other
      financial data appearing elsewhere in this Annual Report.




The
      information set forth in Management’s Discussion and Analysis of Financial
      Condition and Results of Operations (“MD&A”) contains certain
“forward-looking statements” within the meaning of Section 27A of the Securities
      Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934,
      as
      amended, and the Private Securities Litigation Reform Act of 1995, including,
      among others (i) expected changes in the Company’s revenues and profitability,
      (ii) prospective business opportunities and (iii) the Company’s strategy for
      financing its business. Forward-looking statements are statements other than
      historical information or statements of current condition. Some forward-looking
      statements may be identified by use of terms such as “believes”, “anticipates”,
“intends” or “expects”. These forward-looking statements relate to the plans,
      objectives and expectations of the Company for future operations. Although
      the
      Company believes that its expectations with respect to the forward-looking
      statements are based upon reasonable assumptions within the bounds of its
      knowledge of its business and operations, in light of the risks and
      uncertainties inherent in all future projections, the inclusion of
      forward-looking statements in this report should not be regarded as a
      representation by the Company or any other person that the objectives or plans
      of the Company will be achieved. In light of these risks and uncertainties,
      there can be no assurance that actual results, performance or achievements
      of
      the Company will not differ materially from any future results, performance
      or
      achievements expressed or implied by such forward-looking statements. The
      foregoing review of important factors should not be construed as exhaustive.
      The
      Company undertakes no obligation to release publicly the results of any future
      revisions it may make to forward-looking statements to reflect events or
      circumstances after the date hereof or to reflect the occurrence of
      unanticipated events.




The
      Company is currently focused on oil and gas activities for development of
 interests acquired in Texas and Wyoming for the production of oil and
      natural gas. During 2007 we are limiting and winding down the pursuit of and
      potential completion of projects overseas in Central Asian and European
      countries, but reserve the right to re enter these activities at a future date.




30





The
      Company has been making presentations to asset-based lenders and other financial
      institutions for the purpose of expanding and supporting our growth potential
      by
      development of our oil and gas operations in 2008 with a goal to increase our
      revenue base and cash flow; however, the Company makes no guarantees and can
      provide no assurances that it will be successful in these endeavors.




One
      of
      the ways our plans for growth could be altered if current opportunities now
      available become unavailable:




The
      Company would need to identify, locate, or address replacing current potential
      acquisitions or strategic alliances with new prospects or initiate other
      existing available projects that may have been planned for later stages of
      growth and the Company may therefore not be ready to activate. This process
      can
      place a strain on the Company. New acquisitions, business opportunities, and
      alliances, take time for review, analysis, inspections and negotiations. The
      time taken in the review activities, is an unknown factor, including the
      business structuring of the project and related specific due diligence
      factors.




**General**




The
      Company historically derived its revenues primarily from retail sales of oil
      and
      gas field inventory equipment, service, and supply items primarily in the
      southern Arkansas area, and from acquired interests owned in revenue producing
      oil wells, leases, and equipment located in Olney, Young County, Texas. The
      Company disposed of these two segments of operations in 2003. The Company
      acquired a marine vessel sales brokerage and charter business, International
      Yacht Sales Group, Ltd. of Great Britain in December 2003 later disposing of
      its
      operations in late 2005. We accounted for the segments as discontinued
      operations in the consolidated statements of operations for the related fiscal
      year.




Effective
      July 1, 2004, we acquired Firecreek Petroleum, Inc., and its subsidiary
      Firecreek Romania, SRL. Firecreek was focused on exploration and development
      specializing in the niche market of rehabilitation and enhancement of existing
      oilfields through modern management and state of the art technological
      applications internationally. Throughout 2004 and 2005, the Firecreek unit
      developed relationships, pursued and prepared for potential acquisitions in
      Romania and Libya, and through its strategic alliances developed other potential
      projects for acquisition located in Russia, Romania, Kazakhstan, Ukraine, and
      Turkey. Firecreek’s business was subsequently restructured in the first quarter
      of 2006. This process undertook closing our Firecreek subsidiary Ft. Worth
      Texas
      offices, eliminating or lowering many expenses including employees, consultants,
      telephones, long distance, cellular fees, travel, office supplies, data fees,
      and other. Books, accounting records and data were transferred to the Parent
      offices located in Scottsdale Arizona. The restructuring helped to decrease
      overall operating losses for the year 2006, and also to a lesser extent
      conserved existing cash flows. In 2007 Firecreek focused primarily on
      development of U.S. based domestic oil and gas operations in Texas and
      Wyoming.




Effective
      November 15, 2005, Firecreek purchased a 50% undivided working interest in
      leases, wells, equipment, gas and to a lesser extent oil reserves, and other
      rights, located in Green River Basin, Sweetwater County, Wyoming. The project
      is
      listed under the prospect name “Ten Mile Draw” (“TMD”). Through our operator
      Newport Oil Corporation (“Newport”) having completed a successful workover
      program we commenced with gas production from two wells, the 16-1 and 7-16,
      in
      the first and second quarters of 2006, and subsequently began a workover program
      for a third well, the 13-9, in July of 2006 thereof. Experiencing technical
      difficulties and weather conditions Newport completed the 13-9 well in March
      of
      2007. In the second quarter 2007 the 13-9 was taken off production as notified
      by our operator, for the purpose of removing water and fracing fluid build
      up
      and for the purpose of increasing the overall potential for future production.
      In late October of 2007 the Company approved an authorization for expenditure
      related to the 13-9 well (packer workover) to separate the Almond formation
      from
      the Lewis formation. Operations then attempted to reduce the water believed
      coming from the Almond formation, with goal to produce the Lewis sand formation
      on a commercial level. Due to the winter months creating difficulties for
      location work, our operator elected to delay further attempt to kick the well
      off until the spring of 2008 to see if the 13-9 can reach a commercial
      production level. Depending on the economics in the the Wyoming area, the
      Company continues to contemplate one or more additional drilling programs for
      future development in the TMD area (see further discussion in “The
      Business”).




Effective
      July 1, 2007, Firecreek purchased a 100% working interest and related 75% net
      revenue interest in leases, wells, equipment, and oil reserves located in Knox
      County, Texas. The project is listed as the Fant Ranch Unit. Through our
      operator Success Oil Co. Inc., we took over operations, commenced with oil
      production in the third and fourth quarter of 2007, and implemented a phase
      one
      program to rehabilitate and bring two additional wells on line in the Fant
      Unit.
      The Company, subsequent to December 31, 2007 has commenced with enhancement
      and
      rehabilitation for the majority of the producing wells in the Fant Unit which
      the Company believes will improve and stabilize mechanical aspects and
      performance levels for the wells, equipment, and overall production. For
      additional information please see our Report on Form 8-K filed on July 16,
      2007
      incorporated herein by reference.




31


On
      August
      3, 2007, the Company through its Firecreek unit concluded a transaction for
      the
      sale of rights and opportunities for development works and projects located
      in
      the Ukraine. Through the agreement the purchaser acquired the rights to acquire
      licenses, permits and permissions to explore for and extract oil, natural gas
      or
      other natural resources on the territories referenced in the agreement. For
      additional information please see information and exhibits to a Report on Form
      8-K filed on August 13, 2007, incorporated herein by reference. Please also
      see
      Item 3, Legal Proceedings in this report for updated status.




The
      Company expects to incur an increase in operating expenses during the next
      year
      from commencing activities related to its plans for the Company and Firecreek
      oil and gas operations. The amount of net losses and the time required for
      the
      Company to reach and maintain profitability are uncertain at this time. There
      is
      a likelihood that the Company will encounter difficulties and delays encountered
      with business subsidiary operations, including, but not limited to uncertainty
      as to development and the time and timing required for the Company’s plans to be
      fully implemented, governmental regulatory responses to the Company’s plans,
      fluctuating markets and corresponding spikes, or dips in our products demand,
      currency exchange rates between countries, acquisition and development pricing,
      related costs, expenses, offsets, increases, and adjustments. There can be
      no
      assurance that the Company will ever generate significant revenues or achieve
      profitability at all or on any substantial basis.




**RESULTS
      OF OPERATIONS – December 31, 2007 Compared to December 31,
      2006**




Total
      revenue for the commencement of production and sale of oil and natural gas
      in
      fiscal year 2007 was $451,514 compared to $146,831 in total revenue for the
      year
      2006. Oil and Natural gas sales now account for a majority of the Company's
      revenues, attributable to the Fant Ranch Unit oil wells in Knox County, Texas
      and natural gas wells in Sweetwater County, Wyoming.




In
      August
      2007 the Company generated $667,000 in other income from the sale of
      rights/assets to a third party.




Costs
      of
      operations for oil and natural gas production were $447,264 in 2007 as compared
      to $187,911 in 2006. This item includes all well operating expenses and any
      amounts paid to the property manager and consultants.




General
      and administrative costs decreased approximately 51% percent to $1,250,458
      in
      2007 from $2,575,147 in 2006.




Following
      is a breakdown of general and administrative costs for this period versus a
      year
      ago:




**Detail
                of general and administrative expenses:**
            
            **2007**
            
            **2006**Advertising
                & promotion
            
            $
            3,159
            
            $
            66,148Administration
            
            
            3,509
            
            
            126,897Consulting
            
            
            351,583
            
            
            661,271Depreciation
            
            
            0
            
            
            31,467Investor
                incentives/commissions
            
            
            289,439
            
            
            315,262Professional
                fees
            
            
            347,939
            
            
            440,226Rent
                & storage
            
            
            44,093
            
            
            88,797Salaries
                & benefits
            
            
            90,000
            
            
            218,688Travel
                costs
            
            
            0
            
            
            101,422Well
                development
            
            
            120,736
            
            
            524,969Total
            
            $
            1,250,458
            
            $
            2,575,147




Advertising
      and Promotion costs of $3,159 were used for investor relations and market
      awareness.




Administration
      Costs of $3,509 was used for office and general operating expenses.




Consulting
      Fees of $351,583 were incurred for consulting and advisory fees for business
      management activities..




Investor
      Incentives/commissions of $289,439 include costs related to obtaining financing
      and credit lines.




Professional
      Fees of $347,939 were incurred in regards to legal costs, audit costs, securing
      financing, and the acquisition of leads and contacts with regard to possible
      new
      business ventures and includes data acquisition costs, technical work, and
      engineering reports.




Rent
      and
      Storage of $44,093 includes leasing and furnishing offices in Forth Worth,
      Texas.




Salaries
      and Benefits of $90,000 were used to pay Firecreek employees in 2007.




Travel
      costs of $0 in 2007 compared to $101,422 in 2006 in connection with signing
      of
      agreements, negotiating contracts and arranging for potential
      financing.




32





Wells
      development includes costs of $120,736 related to workover programs for our
      oil
      and gas interest held in the Ten Mile Draw project in Sweetwater County,
      Wyoming, and Fant Ranch Unit work programs.




After
      deducting general and administrative expense, the Company experienced a loss
      from operations of $1,246,208 in 2007 as compared to a loss of $2,616,227 in
      fiscal 2006.




Interest
      expense for fiscal year 2007 was $1,266,152 compared to $1,749,340 in fiscal
      year 2006. Gain on derivative liability for fiscal year 2007 was $361,964 as
      compared to $14,865 in fiscal year 2006.




After
      deducting interest expense and adding the gain on derivative liability, the
      Company incurred a net loss of $1,474,050 in fiscal year 2007 compared to a
      loss
      of $4,350,702, in fiscal year 2006.




After
      accounting for other income and expenses, the net loss for fiscal year ended
      2007 was $1,474,050, or $0.00 per share as compared to $4,350,702, or $ 0.02
      per
      share for fiscal year ended 2006.




**LIQUIDITY
      AND CAPITAL RESOURCES**




Cash
      on
      hand at December 31, 2007 was $2,009,734 compared to $14,955 at the beginning
      of
      the year. At December 31, 2007, the Company had working capital deficit of
      $3,519,638 compared to $4,555,005 at the beginning of the year.




Cash
      used
      by operating activities was $784,190 for the year ended December 31, 2007,
      compared with $1,569,827 for the year ended December 31, 2006.




The
      Company paid in $1,626,031in fiscal year 2007 of leases and equipment, all
      of
      which was related to the acquisition of the Fant Ranch Base. In fiscal year
      ended 2006, we purchased $271,746 of well equipment for the Ten Mile Draw.
      The
      Company received $4,405,000 in fiscal year 2007 compared to  $1,505,000 in
      fiscal year 2006 by issuing convertible debentures and promissory notes on
      its
      equity credit line.




Total
      assets increased to $4,833,885 at December 31, 2007 compared to $1,203,014
      at
      the beginning of the year mainly as a result of the acquisition of oil and
      gas
      assets, and proceeds from debenture financing.




Shareholders
      deficit decreased to $3,784,037 at December 31, 2007 from a deficit of
      $5,197,711 at December 31, 2006. During fiscal year 2007, the Company issued
      10,142,158 shares to consultants valued at $58,786 for services rendered. In
      addition, the Company issued 78,747,315shares to pay the equity line of
      $260,378. During fiscal year 2007, the Company issued convertible debentures
      with a face amount of $4,100,000 and 700,000,000 shares of common stock and
      20,000,000 of preferred stock and received net proceeds of $3,970,000. The
      issuances of the common stock and the preferred stock were valued at fair market
      of $700,000 and $200,000 respectively. The fair value associated with the
      issuance of the debentures using the Black Sholes Options pricing model was
      $1,853,360.




In
      addition, the value of the Star Energy stock received for the sale of our rights
      in the Ukraine discussed above fell $184,800 which we have classified as other
      comprehensive income since we regard this stock holding as a security “available
      for sale”, however that classification could change in 2008, in which case we
      most likely will classify any gains or losses from this asset into regular
      earnings.




Finally,
      we incurred  net losses during 2007 of $1,474,050, which results in an
      ending shareholder deficit at December 31, 2007 of $3,784,037.




The
      Company must generally undertake certain ongoing expenditures in connection
      expanding and developing its Firecreek Petroleum, Inc. oil and gas business,
      and
      for various past and present legal, accounting, consulting, and technical
      review, and to perform due diligence for activating one or more of its
      acquisition and development programs; furthering its development of new and
      ongoing business prospects, and in pursuing capital financing for its existing
      and proposed operations.




The
      equity line financing company that provided the Equity Line has cancelled the
      Equity Line. As part of additional financing on December 26, 2007 for $2.1
      million dollars, the terms of that loan included the issuance of two debentures,
      40% of the revenues generated by the Company which is applied to previously
      existing notes, and 85% of the stock of the Company as an inducement (for
      further information please see Current Report on form 8-K filed on January
      7,
      2008, incorporated herein by reference).  In addition, certain members of
      the financing Company have become members of the Company’s Board of Directors.
      Although unlikely, there can be no assurance that the finance company issuing
      the notes will continue to refrain from noticing or acting on a formal default,
      however the Company believes its present members are working uniformly to assist
      growth of the Company.  A change from a favorable circumstance with our
      finance company, encountering a formal default, could, in lieu of positive
      negotiations occurring, anticipate potentially detrimental conditions including
      but not limited to one or more of the following: i) rapid conversion of
      debentures to shares of the Company’s up to 85% of the common stock in
      accordance with the terms and provisions of the note agreements, ii)
      acceleration and foreclosure on one or all of the assets of the Company and
      its
      subsidiaries, iii) imposing financial duress creating difficulty or inability
      to
      run the Company or its business affairs, iv) create pressure on the Company’s
      stock by increased supply, and v) increased dilution to shareholders. Although
      the terms of the notes are stringent, the Company continues to secure needed
      financing for its growth plans.




33


Management
      has estimated that such cost for initially paying down certain of the Company’s
      recent debt, including such amounts needed to pay partial or full payment of
      its
      equity line notes, and activating development of its current plans for domestic
      and overseas commencement of oil and gas segment operations, will initially
      require approximately $8,000,000 to $12,500,000 or more during the first six
      to
      twelve months of fiscal 2007. The Company obtained $435,000 in March 2007,
      $2,000,000 in June 2007, and $2,100,000 in December 2007 from the issuance
      of a
      promissory note and three debentures to the finance company that has provided
      financing originally through an Equity Line. In December members of the
      financing company joined the Company’s Board of Directors, as a condition of the
      financing discussed and as provided herein. The Equity Line has been canceled
      with the financing that occurred on December 26, 2007. We are working to secure
      up to $10,000,000 or more in asset based, and or other debt or equity finance
      projected by June or later to assist our 2008 plans. There can be no guarantee
      or assurance that we will receive or be successful in obtaining additional
      financing. In addition, the Company has a covenant with its equity line finance
      company, which managing members are directors, affiliates, and shareholders
      of
      the Company, not to enter into any additional financing agreements, debt or
      equity, without prior expressed written consent, which shall not be unreasonably
      withheld.




Financing
      our full expansion and development plans for our domestic and overseas oil
      and
      gas operations could require up to $50,000,000 or more. The Company may elect
      to
      reduce or increase its requirement as circumstances dictate. We may elect to
      revise these plans and requirements for funds depending on factors including;
      changes in acquisition and development estimates; interim corporate and project
      finance requirements; unexpected timing of markets as to cyclical aspects as
      a
      whole; currency and exchange rates; project availability with respect to
      interest and timing factors indicated from parties representing potential
      sources of capital; structure and status of our strategic alliances, potential
      joint venture partners, and or our targeted acquisitions and or
      interests.




The
      Company cannot predict that it will be successful in obtaining funding for
      its
      plans or that it will achieve profitability in fiscal 2008.


34





**ITEM
              7.**
            **FINANCIAL
                STATEMENTS AND SUPPLEMENTARY
                DATA**





**EGPI
      FIRECREEK, INC.**


**(formerly
      Energy Producers, Inc.)**





**CONSOLIDATED**


**FINANCIAL
      STATEMENTS**


**DECEMBER
      31, 2006 AND DECEMBER 31, 2005**


**Index
      to Financial Statements**





Independent
                Auditor’s Report
            
            F-2Consolidated
                Balance Sheets
            
            F-3Consolidated
                Statement of Operations
            
            F-4Consolidated
                Statement of Cash Flows
            
            F-5Consolidated
                Statement of Changes in Shareholders Deficit
            
            F-6Notes
                to the Consolidated Financial Statements
            
            F-7
                – F-18


F-1





**DONAHUE
      ASSOCIATES, LLC**


**Certified
      Public Accountants**


**27
      Beach Road Suite CO5A**


**Monmouth
      Beach, NJ 07750**


**Tel.
      732-229-7723**




**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**




To
      the
      Board of Directors and Stockholders of EGPI Firecreek, Inc.




We
      have
      completed the audits of the consolidated financial statements of EGPI Firecreek,
      Inc. (the “Company”) and its internal control over financial reporting as of
      December 31, 2007 and December 31, 2006 in accordance with the
      standards of the Public Company Accounting Oversight Board (United States).




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 audit to obtain reasonable assurance about whether the
      consolidated financial statements are free of material misstatement. The Company
      is not required to have, nor were we engaged to perform, an audit of its
      internal control over financial reporting. Our audits included 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 the Company’s internal control
      over financial reporting. Accordingly, we express no such opinion. An audit
      also
      includes, examining, on a test basis, evidence supporting the amounts and
      disclosures in the consolidated financial statements, 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 consolidated financial statements present fairly, in all material
      respects, the financial position of EGPI Firecreek, Inc. (the “Company”) at
      December 31, 2007 and December 31, 2006, and the results of its
      operations, cash flows, and changes in shareholders’ equity for the years then
      ended in conformity with accounting principles generally accepted in the United
      States of America. 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.




The
      accompanying financial statements have been prepared assuming that the Company
      will continue as a going concern.  As discussed in Note 2 to the financial
      statements, the Company has suffered recurring losses and negative cash flows
      from operations that raise substantial doubt about its ability to continue
      as a
      going concern.  Management’s plans in regard to these matters are also
      discussed in Note 2.  The financial statements do not include any
      adjustments that might result from the outcome of this uncertainty




By:Donahue
                Associates, LLC.Monmouth
                Beach, New JerseyApril
                14, 2008




F-2





**EGPI
      Firecreek, Inc.**


**Consolidated
      Balance Sheets**


**As
      of December 31, 2007 and December 31, 2006**





****
            
            **2007**
            
            **2006****ASSETS**Current
                assets:Cash
            
            $
            2,009,734
            
            $
            14,955Accounts
                receivable
            
            
            76,348
            
            
            0Deferred
                charges
            
            
            13,739
            
            
            319,190Total
                current assets
            
            $
            2,099,821
            
            $
            334,145Other
                assets:Investment
                in Star Energy, fair market value
            
            
            382,200
            
            
            0Deferred
                charges
            
            
            116,934Fixed
                assets- net
            
            
            2,234,930
            
            
            868,869Total
                assets
            
            $
            4,833,885
            
            $
            1,203,014**LIABILITIES
                AND SHAREHOLDERS' DEFICIT**Current
                liabilities:Accounts
                payable & accrued expenses
            
            $
            866,110
            
            $
            839,373Equity
                line notes payable- net of discount
            
            
            4,753,349
            
            
            4,049,777Total
                current liabilities
            
            $
            5,619,459
            
            $
            4,889,150Advances
                payable to shareholders
            
            
            218,926
            
            
            168,052Convertible
                debentures- net of discount
            
            
            632,563
            
            
            0Derivative
                liability
            
            
            2,146,974
            
            
            1,343,533Total
                liabilities
            
            $
            8,617,922
            
            $
            6,400,735Shareholders'
                deficit:Series
                A preferred stock, 20 million authorized, par value $0.001, one share
                convertible to one common share, no stated dividend, none
                outstanding
            
            $
            0
            
            $
            0Series
                B preferred stock, 20 million authorized, par value $0.001, one share
                convertible to one common share, no stated dividend, none
                outstanding
            
            
            0
            
            
            0Series
                C preferred stock, 20 million authorized, stated value $.001, one
                share
                convertible to ten common shares, no stated dividend. 20 million
                shares
                outstanding
            
            
            200,000
            
            
            0Common
                stock- $.001 par value, authorized 1,320,000,000 shares, issued and
                outstanding, 1,184,257,619 at December 31, 2007 and 395,367,446 shares
                at
                December 31, 2006
            
            $
            1,184,257
            
            $
            395,367Additional
                paid in capital
            
            
            20,970,812
            
            
            18,887,168Other
                comprehensive loss
            
            
            (184,800
            )
            
            0Accumulated
                deficit
            
            
            (25,954,306
            )
            
            (24,480,256
            )Total
                shareholders' deficit
            
            
            (3,784,037
            )
            
            (5,197,721
            )Total
                Liabilities & Shareholders' Deficit
            
            $
            4,833,885
            
            $
            1,203,014





**See
      the notes to the consolidated financial statements.**


F-3




**EGPI
      Firecreek, Inc.**


**Consolidated
      Statements of Operations**


**For
      the Years Ended December 31, 2007 and December 31,
      2006**





**2007**
            
            **2006**Gross
                Revenues from sales
            
            $
            451,514
            
            $
            146,831Cost
                of sales
            
            
            (447,264
            )
            
            (187,911
            )Net
                Revenues from sales
            
            $
            4,250
            
            **$**
            (41,080
            )General
                and administrative expenses:General
                administration
            
            $
            1,250,458
            
            $
            2,575,147Total
                general & administrative expenses
            
            
            1,250,458
            
            
            2,575,147Net
                loss from operations
            
            $
            (1,246,208
            )
            $
            (2,616,227
            )Other
                revenues and expenses:Gain
                on sale of asset
            
            
            667,000
            
            
            0Gain
                on derivative liability
            
            
            361,964
            
            
            14,865Interest
                income
            
            
            9,346
            
            
            0Interest
                expense
            
            
            (1,266,152
            )
            
            (1,749,340
            )Net
                loss before provision for income taxes
            
            $
            (1,474,050
            )
            $
            (4,350,702
            )Provision
                for income taxes
            
            
            0
            
            
            0Net
                loss
            
            $
            (1,474,050
            )
            $
            (4,350,702
            )Basic
                & fully diluted net loss per common share:Loss
                per share
            
            $
            (0.00
            )
            $
            (0.02
            )Weighted
                average of common shares outstanding:Basic
                & fully diluted
            
            
            431,768,250
            
            
            286,203,311




**See
      the notes to the consolidated financial statements.**




F-4




**EGPI
      Firecreek, Inc.**


**Consolidated
      Statements of Cash Flows**


**For
      the Years Ended December 31, 2007 and December 31, 2006**





**2007**
            
            **2006**Operating
                Activities:Net
                loss
            
            $
            (1,474,050
            )
            $
            (4,350,702
            )Adjustments
                to reconcile net loss items not requiring the use of cash:Impairment
                expense
            
            
            135,786
            
            
            0Depreciation
                & depletion expense
            
            
            124,184
            
            
            100,736Consulting
                expense
            
            
            58,786
            
            
            336,003Interest
                expense
            
            
            1,161,152
            
            
            1,749,341Amortization
                of deferred charges
            
            
            188,517
            
            
            152,685Gain
                on sale of asset
            
            
            (567,000
            )
            
            0Gain
                on derivative liability
            
            
            (361,964
            )
            
            (14,865
            )Changes
                in other operating assets and liabilities :Accounts
                receivable
            
            
            (76,338
            )
            
            2,759Accounts
                payable and accrued expenses
            
            
            26,737
            
            
            454,216Net
                cash used by operations
            
            $
            (784,190
            )
            $
            (1,569,827
            )Investing
                activities:Purchase
                of lease & equipment
            
            $
            (1,626,031
            )
            $
            (271,746
            )Net
                cash used for investing activities
            
            
            (1,626,031
            )
            
            (271,746
            )Financing
                Activities:Credit
                equity line
            
            $
            435,000
            
            $
            1,505,000Convertible
                debentures
            
            
            3,970,000
            
            
            0Issuance
                common stock
            
            
            0
            
            
            77,790Warrants
                converted to stock
            
            
            0
            
            
            100,000Shareholder
                advances received
            
            
            0
            
            
            23,776Net
                cash provided by financing activities
            
            
            4,405,000
            
            
            1,706,566Net
                increase (decrease) in cash during the year
            
            $
            1,994,779
            
            $
            (135,007
            )Cash
                balance at January 1st
            
            
            14,955
            
            
            149,962Cash
                balance at December 31st
            
            $
            2,009,734
            
            $
            14,955Supplemental
                disclosures of cash flow information:Interest
                paid during the period
            
            $
            112,263
            
            $
            0Income
                taxes paid during the period
            
            $
            0
            
            $
            0




**See
      the notes to the consolidated  financial
      statements.**


F-5




**EGPI
      Firecreek, Inc.**


**Consolidated
      Statement of Changes in Shareholders’ Deficit**


**For
      the Years Ended December 31, 2007 and December 31, 2006**





**Other****Preferred**
            
            **Preferred**
            
            **Common**
            
            **Par**
            
            **Paid in**
            
            **Accumulated**
            
            **Comprehensive****Shares**
            
            **Value**
            
            **Shares**
            
            **Value**
            
            **Capital**
            
            **Deficit**
            
            **Loss**
            
            **Total**Balance
                at December 31, 2005
            
            
            2,025,000
            
            $
            1,539,000
            
            
            220,913,500
            
            $
            220,913
            
            $
            15,420,637
            
            $
            (20,129,554
            )
            $
            0
            
            $
            (4,488,004
            )Issuance
                of warrants
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            5,407
            
            
            
            
            
            
            
            
            5,407Issued
                shares for services
            
            
            0
            
            
            0
            
            
            87,500,000
            
            
            87,500
            
            
            666,200
            
            
            
            
            
            
            
            
            753,700Issuance
                of common stock
            
            
            0
            
            
            0
            
            
            4,148,514
            
            
            4,149
            
            
            73,641
            
            
            
            
            
            
            
            
            77,790Conversion
                of warrants
            
            
            0
            
            
            0
            
            
            4,000,000
            
            
            4,000
            
            
            96,000
            
            
            
            
            
            
            
            
            100,000Conversion
                of preferred stock
            
            
            (2,025,000
            )
            
            (1,539,000
            )
            
            20,250,000
            
            
            20,250
            
            
            1,518,750
            
            
            
            
            
            
            
            
            1,539,000Issued
                shares to pay equity line
            
            
            0
            
            
            0
            
            
            58,555,432
            
            
            58,555
            
            
            1,106,543
            
            
            
            
            
            
            
            
            1,165,098Net
                loss for the fiscal year
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (4,350,702
            )
            
            
            
            
            (4,350,702
            )Balance
                at December 31, 2006
            
            
            0
            
            $
            0
            
            
            395,367,446
            
            
            395,367
            
            
            18,887,178
            
            
            (24,480,256
            )
            
            0
            
            
            (5,197,711
            )Issued
                shares to pay equity line
            
            
            0
            
            
            0
            
            
            78,747,315
            
            
            78,747
            
            
            181,631
            
            
            
            
            
            
            
            
            260,378Shares
                issued to pay consultants
            
            
            0
            
            
            0
            
            
            10,142,858
            
            
            10,143
            
            
            48,643
            
            
            
            
            
            
            
            
            58,786Issuance
                of preferred stock
            
            
            20,000,000
            
            
            200,000
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            200,000Issuance
                of common stock
            
            
            0
            
            
            0
            
            
            700,000,000
            
            
            700,000
            
            
            0
            
            
            
            
            
            
            
            
            700,000Issuance
                of debenture- conversion feature
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            456,520
            
            
            
            
            
            
            
            
            456,520Reclassification
                of derivative liability
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            1,396,840
            
            
            
            
            
            
            
            
            1,396,840Loss
                on investment (Star Energy)
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (184,800
            )
            
            (184,800
            )Net
                loss for the fiscal year
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (1,474,050
            )
            
            
            
            
            (1,474,050
            )Balance
                at December 31, 2007
            
            
            20,000,000
            
            $
            200,000
            
            
            1,184,257,619
            
            $
            1,184,257
            
            $
            20,970,812
            
            $
            (25,954,306
            )
            $
            (184,800
            )
            $
            (3,784,037
            )





**Please
      see the notes to the consolidated financial
      statements.**


F-6




**EGPI
      Firecreek, Inc.**


**Notes
      to the Consolidated Financial Statements**


**For
      the Years Ended December 31, 2007 and December 31, 2006**





**1.
      Organization of the Company and Significant Accounting
      Principles**




EGPI
      Firecreek, Inc. (the Company”, “we” or “us”) was incorporated in the State of
      Nevada October 1995. Effective October 13, 2004 the Company, previously known
      as
      Energy Producers Inc., changed its name to EGPI Firecreek, Inc.




The
      Company is a 50% non-controlling owner of three gas wells in Wyoming.




In
      December 2006, the Company increased its authorized common stock to
      1,320,000,000 shares with par value of $.001. Twenty million of these shares
      are
      non-voting.




*Consolidation-* the
      accompanying consolidated financial statements include the accounts of the
      Company and its wholly owned subsidiary.  All significant inter-company
      balances have been eliminated.




*Use
      of Estimates* -
      The
      preparation of the financial statements in conformity with accounting principles
      generally accepted in  the United States of America requires management to
      make reasonable estimates and assumptions that affect the reported amounts
      of
      the assets and liabilities and disclosure of contingent assets and liabilities
      and the reported amounts of revenues and expenses at the date of the
      consolidated financial statements and for the period they include.  Actual
      results may differ from these estimates.




*Revenue
      and Cost Recognition-* Revenue
      is recognized from oil sales at such time as the oil is delivered to the
      buyer *.* For
      its
      producing activities, the Company uses successful efforts costing.




*Properties
      and Equipment-* The
      Company uses the successful efforts method of accounting for oil and gas
      producing activities. Under this method, acquisition costs for proved and
      unproved properties are capitalized when incurred. Exploration costs, including
      geological and geophysical costs, the costs of carrying and retaining unproved
      properties and exploratory dry hole drilling costs, are expensed. Development
      costs, including the costs to drill and equip development wells, and successful
      exploratory drilling costs to locate proved reserves are capitalized.




Exploratory
      drilling costs are capitalized when incurred pending the determination of
      whether a well has found proved reserves. A determination of whether a well
      has
      found proved reserves is made shortly after drilling is completed. The
      determination is based on a process which relies on interpretations of available
      geologic, geophysic, and engineering data. If a well is determined to be
      successful, the capitalized drilling costs will be reclassified as part of
      the
      cost of the well. If a well is determined to be unsuccessful, the capitalized
      drilling costs will be charged to expense in the period the determination is
      made. If an exploratory well requires a major capital expenditure before
      production can begin, the cost of drilling the exploratory well will continue
      to
      be carried as an asset pending determination of whether proved reserves have
      been found only as long as: i) the well has found a sufficient quantity of
      reserves to justify its completion as a producing well if the required capital
      expenditure is made and ii) drilling of the additional exploratory wells is
      under way or firmly planned for the near future. If drilling in the area is
      not
      under way or firmly planned, or if the well has not found a commercially
      producible quantity of reserves, the exploratory well is assumed to be impaired,
      and its costs are charged to expense.




In
      the
      absence of a determination as to whether the reserves that have been found
      can
      be classified as proved, the costs of drilling such an exploratory well is
      not
      carried as an asset for more than one year following completion of drilling.
      If,
      after that year has passed, a determination that proved reserves exist cannot
      be
      made, the well is assumed to be impaired, and its costs are charged to expense.
      Its costs can, however, continue to be capitalized if a sufficient quantity
      of
      reserves are discovered in the well to justify its completion as a producing
      well and sufficient progress is made in assessing the reserves and the well’s
      economic and operating feasibility.




The
      impairment of unamortized capital costs is measured at a lease level and is
      reduced to fair value if it is determined that the sum of expected future net
      cash flows is less than the net book value. The Company determines if an
      impairment has occurred through either adverse changes or as a result of the
      annual review of all fields. During 2007 and 2006, the Company did not record
      any impairment.




Development
      costs of proved oil and gas properties, including estimated dismantlement,
      restoration and abandonment costs and acquisition costs, are depreciated and
      depleted on a field basis by the units-of-production method using proved
      developed and proved reserves, respectively. The costs of unproved oil and
      gas
      properties are generally combined and impaired over a period that is based
      on
      the average holding period for such properties and the Company's experience
      of
      successful drilling.




F-7




Costs
      of
      retired, sold or abandoned properties that make up a part of an amortization
      base (partial field) are charged to accumulated depreciation, depletion and
      amortization if the units-of-production rate is not significantly affected.
      Accordingly, a gain or loss, if any, is recognized only when a group of proved
      properties (entire field) that make up the amortization base has been retired,
      abandoned or sold.




*Cash-* For the
      purpose of calculating changes in cash flows, cash includes all cash balances
      and highly liquid short-term investments with original maturity dates of three
      months or less.




*Deferred
      costs-* Deferred
      costs are the costs of obtaining the equity line of credit and other convertible
      debentures as discussed in Note 10 and Note 11.  The deferred costs are
      amortized over the life of the loan.




*Fixed
      Assets* **-** Fixed
      assets are stated at cost. Depreciation expense is computed using the
      straight-line method over the estimated useful life of the asset. The following
      is a summary of the estimated useful lives used in computing depreciation
      expense:




Office
                equipment
            
            
            3
                yearsComputer
                hardware & software
            
            
            3
                yearsImprovements
                & furniture
            
            
            5
                yearsWell
                equipment
            
            
            7
                years




Expenditures
      for major repairs and renewals that extend the useful life of the asset are
      capitalized.  Minor repair expenditures are charged to expense as
      incurred.




*Long
      Lived Assets* -
      In
      accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of
      Long-Lived Assets”, the Company reviews for the impairment of long-lived assets
      whenever events or changes in circumstances indicate that the carrying amount
      of
      an asset may not be recoverable. An impairment loss would be recognized when
      estimated future cash flows expected to result from the use of the asset and
      its
      eventual disposition is less than its carrying amount.




*Income
      taxes-* The
      Company accounts for income taxes in accordance with the Statement of Accounting
      Standards No. 109 (SFAS No. 109), " *Accounting
      for Income Taxes* ".
       SFAS No. 109 requires an asset and liability approach to financial
      accounting and reporting for income taxes.  Deferred income tax assets and
      liabilities are computed annually for differences between financial statement
      and income tax bases of assets and liabilities that will result in taxable
      income or deductible expenses in the future based on enacted tax laws and rates
      applicable to the periods in which the differences are expected to affect
      taxable income.  Valuation allowances are established when necessary to
      reduce deferred tax assets and liabilities to the amount expected to be
      realized.  Income tax expense is the tax payable or refundable for the
      period adjusted for the change during the period in deferred tax assets and
      liabilities.




*Reclassifications* -
      Certain
      2006 amounts in the consolidated financial statements have been reclassified
      to
      conform to the 2007 presentation.




*Recent
      accounting pronouncements:*




In
      July
      2006, the FASB issued Interpretation No. 48 ("FIN 48"), " *Accounting
      to Uncertainty in Income Taxes* and *An
      Interpretation of FASB Statement No.109* ."
      FIN 48
      clarifies the accounting for uncertainty in income taxes recognized in an
      enterprise's financial statements in accordance with SFAS 109.  FIN 48 also
      prescribes a recognition threshold and measurement attribute for the financial
      statement recognition and measurement of a tax position taken or expected to
      be
      taken in a tax return. The new FASB standard also provides guidance on
      de-recognition, classification, interest and penalties, accounting in interim
      periods, disclosure, and transition. The provisions of FIN 48 are effective
      for
      the Company's first quarter ending March 31, 2008. The adoption of FIN 48 will
      not have a material impact on the financial statements of the
      Company.




In
      September 2006, the FASB issued SFAS No.157, " *Fair
      Value Measurements* ",
      which
      defines fair value, establishes a framework for measuring fair value in
      generally accepted accounting principles and expands disclosures about fair
      value measurements. SFAS 157 is effective for financial statements issued for
      fiscal years beginning after November 15, 2007 and interim periods within those
      fiscal years. Earlier application is encouraged provided that the reporting
      entity has not yet issued financial statements for that fiscal year including
      financial statements for an interim period within that fiscal year. The adoption
      of SFAS No. 157 will not have a material impact on the financial statements
      of
      the Company.




In
      January 2007, the FASB issued Derivatives Implementation Group Statement 133
      Implementation Issue No. B40, *“Embedded
      Derivatives: Application of Paragraph 13(b) to Securitized Interested in
      Prepayable Financial Assets* ”.
      This
      Issue provides a narrow scope exception from paragraph 13(b) of Statement No.
      133 for securitized interests that contain only an embedded derivative that
      is
      tied to the prepayment risk of the underlying prepayable financial assets.
      The
      guidance in this Issue is generally effective upon initial adoption of Statement
      No. 155.  Derivatives Implementation Group Statement 133 Implementation
      Issue No. B40 did not have a material impact on the Company’s financial
      statements.




F-8




In
      February 2007, the FASB issued SFAS No.159, " *The
      Fair Value Option for Financial Assets and Financial
      Liabilities”* &.
      The statement permits entities to choose to measure certain financial assets
      and
      liabilities at fair value. Unrealized gains and losses on items for which the
      fair value option has been elected are reported in earnings. SFAS No.159 is
      effective as of the beginning of an entity's fiscal year that begins after
      November 15, 2007. The adoption of SFAS No. 159 will not have a material impact
      on the financial statements of the Company.




In
      November 2007, the Securities and Exchange Commission issued Staff Accounting
      Bulletin (SAB) No. 109, " *Written
      Loan Commitments Recorded at Fair Value Through Earnings* ."
      SAB
      No.109 states that the expected net future cash flows related to the associated
      servicing of a loan should be included in the measurements of all written loan
      commitments that are accounted for at fair value through earnings. The
      provisions of SAB No.109 are applicable to written loan commitments issued
      or
      modified in fiscal quarters beginning after December 15, 2007. The adoption
      of
      SAB No. 159 will not have a material impact on the financial statements of
      the
      Company.




In
      December 2007, the FASB issued SFAS No. 141 (revised 2007), " *Business
      Combinations* "
      (SFAS
      141(R)), which replaces SFAS No. 141, " *Business
      Combinations* ."
      SFAS
      141(R) retains the underlying concepts of SFAS 141 in that all business
      combinations are still required to be accounted for at fair value under the
      acquisition method of accounting but SFAS 141(R) changed the method of applying
      the acquisition method in a number of significant aspects. Acquisition costs
      will generally be expensed as incurred; noncontrolling interests will be valued
      at fair value at the acquisition date; in-process research and development
      will
      be recorded at fair value as an indefinite-lived intangible asset at the
      acquisition date; restructuring costs associated with a business combination
      will generally be expensed subsequent to the acquisition date; and changes
      in
      deferred tax asset valuation allowances and income tax uncertainties after
      the
      acquisition date generally will affect income tax expense. SFAS 141(R) is
      effective on a prospective basis for all business combinations for which the
      acquisition date is on or after the beginning of the first annual period
      subsequent to December 15, 2008, with the exception of the accounting for
      valuation allowances on deferred taxes and acquired tax contingencies. SFAS
      141(R) amends SFAS 109 such that adjustments made to valuation allowances on
      deferred taxes and acquired tax contingencies associated with acquisitions
      that
      closed prior to the effective date of SFAS 141(R) would also apply the
      provisions of SFAS 141(R). Early adoption is not permitted. SFAS 141(R) is
      not
      expected to have a material impact 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* ."
      This
      statement is effective for fiscal years, and interim periods within those fiscal
      years, beginning on or after December 15, 2008, with earlier adoption
      prohibited. This statement requires the recognition of a noncontrolling interest
      (minority interest) as equity in the consolidated financial statements and
      separate from the parent's equity. The amount of net income attributable to
      the
      noncontrolling interest will be included in consolidated net income on the
      face
      of the income statement. It also amends certain of ARB No. 51's consolidation
      procedures for consistency with the requirements of SFAS 141(R). This statement
      also includes expanded disclosure requirements regarding the interests of the
      parent and its noncontrolling interest. SFAS 160 is not expected to have a
      material impact on the Company’s financial statements.




**2.
      Going Concern**




The
      accompanying consolidated financial statements have been presented in accordance
      with generally accepted accounting principals, which assume the continuity
      of
      the Company as a going concern.  However, during the years ended December
      31, 2007 and December 31, 2006, the Company generated no material revenues
      and
      has relied on borrowings and the issuance of common and preferred stock to
      raise
      money for its business operations and plans.  This situation raises the
      doubt of the Company’s ability to continue as a going concern




Management’s
      plans with regard to this matter are as follows:




-Raise
      interim and long term finance in addition to its present equity line to assist
      expansion-development and acquisition programs for oil and gas, corporate
      operations, and for the purpose of building on the current revenue
      base.




-Obtain
      asset based project finance or develop joint ventures to fund work programs
      for
      oil and gas projects domestically and overseas.




-Pursue
      formation of strategic alliances with more firmly established peer groups to
      assist acquisition activities.




-Initiate
      search for experienced oil and gas personnel to add to our staff.




F-9




**3.
      Fair Values of Financial Instruments** ******




Fair
      value estimates, assumptions and methods used to estimate fair value of the
      Company’s financial instruments are made in accordance with requirements of SFAS
      No. 107, “ *Disclosure
      about Fair Value of Financial Instruments* .”
       The Company has used available information to derive its estimates.
 However, because these estimates are made as of a specific point in time,
      they are not necessarily indicative of amounts the Company could realize
      currently.  The use of different assumptions or estimating methods may have
      a material effect on the estimated fair value amounts.




The
      carrying amounts of the cash, accounts receivable, deferred charges, investment
      in Star Energy, accounts payable and accrued expenses, equity line notes
      payable, advances payable to shareholders, convertible debentures payable and
      derivative liability payable reported in the balance sheets are estimated by
      management to approximate fair value at December 31, 2007 and December 31,
      2006.




**4.
      Net Loss per Share**




The
      Company applies SFAS No. 128, *Earnings
      per Share* to
      compute net loss per share *.* In
      accordance with SFAS No. 128, basic net loss per share has been computed based
      on the weighted average of common shares outstanding during the years. Diluted
      net loss per share gives the effect of outstanding common stock equivalents
      in
      the form of warrants, convertible preferred stock, and convertible debentures.




The
      effects on net loss per share of the common stock equivalents, however, are
      not
      included in the calculation of net loss per share since their inclusion would
      be
      anti-dilutive.




Net
      loss
      per common share has been computed as follows:


**2007**
              
              **2006**Net
                  loss
              
              $
              (1,474,050
              )
              $
              (4,350,702
              )Total
                  shares outstanding
              
              
              1,184,257,619
              
              
              395,367,446Weighted
                  average
              
              
              431,768,250
              
              
              286,203,311Loss
                  per share
              
              $
              (0.00
              )
              $
              (0.02
              )




F-10




**5.
      Common and Preferred Stock Transactions**




During
      the year ended December 31, 2006, the Company issued 4,000,000 shares for the
      conversion of 4,000,000 warrants and received proceeds of $100,000.




During
      the year ended December 31, 2006, the Preferred C shareholders converted their
      shares to 20,250,000 shares of common stock.




During
      the year ended December 31, 2006, the Company issued 58,555,432 shares of common
      stock to pay down the equity line of credit.




During
      the year ended December 31, 2006, the Company issued 4,148,514 shares of common
      stock and received proceeds of $77,790.




During
      the year ended December 31, 2006, the Company issued 87,500,000 shares of common
      stock to employees and consultants for services rendered.




During
      the year ended December 31, 2007, the Company issued 10,142,858 shares of common
      stock to pay consulting fees.




During
      the year ended December 31, 2007, the Company issued 78,747,315 shares of common
      stock to pay down the equity line.




During
      the year ended December 31, 2007, the Company issued 700,000,000 shares of
      common stock as an incentive to a noteholder.




During
      the year ended December 31, 2007, the Company issued 20,000,000 shares of
      Preferred C stock as an incentive to a noteholder.




**6.
      Preferred Stock Series**




*Series
      A preferred stock* :
      Series
      A preferred stock has a par value of $0.001 per share and no stated dividend
      preference. The Series A is convertible into common stock at a conversion
      ratio of one preferred share for one common share. Preferred A has
      liquidation preference over Preferred B stock and common stock.




*Series
      B preferred stock* :
      Series
      B preferred stock has a par value of $0.001 per share and no stated dividend
      preference. The Series B is convertible into common stock at a conversion
      ratio of one preferred share for one common share. The Series B has liquidation
      preference over Preferred C stock and common stock.




*Series
      C preferred stock* :
      The
      Preferred C stock has a stated value of $.001 and no stated dividend rate and
      is
      non-participatory.  One share of preferred is convertible into 10 shares of
      common stock.  The Series C has liquidation preference over common stock.




**7.
      Fixed Assets- Net**




The
      following is a detailed list of fixed assets:


**2007**
              
              **2006**Well
                  leases
              
              $
              1,068,650
              
              $
              475,000Well
                  equipment
              
              
              1,316,710
              
              
              403,732Computer
                  equipment & software
              
              
              0
              
              
              63,676Office
                  equipment
              
              
              0
              
              
              19,056Improvements
                  & furniture
              
              
              0
              
              
              30,166Accumulated
                  depreciation & depletion
              
              
              (150,430
              )
              
              (122,761
              )Fixed
                  assets- net
              
              $
              2,234,930
              
              $
              868,869




In
      fiscal
      year 2007, the Company closed its former Firecreek offices in Fort Worth, Texas
      as part of its restructuring efforts.  Management elected to impair the
      value of the fixed assets associated with this office and recorded the
      impairment expense in the statement of operations.




F-11





**8.
      Concentration of Credit Risk**




The
      inability of the Company to make its payments on the equity line discussed
      in
      Note 10 could limit or entirely prevent the Company’s ability to draw down
      additional borrowings now or in the future, or to generate cash from the
      issuance of common stock to sustain operations and growth. A withdrawal of
      support of the issuer equity line of credit would have a material adverse affect
      on the Company’s financial position and its ability to continue to operate as a
      going concern.




**9.
       Issuance of Warrants**




During
      the fiscal year ended December 31, 2006, the Company issued 5,500,000 warrants
      to consultants and recorded an expense of $5,407.




The
      Company applies SFAS No. 123, “ *Accounting
      for Stock-Based Compensation* ”
to
      account for warrant issues.  Accordingly, all warrants granted are recorded
      at fair value using a generally accepted option pricing model at the date of
      the
      grant.  For purposes of determining compensation expense under SFAS 123,
      the fair value of each warranted granted is measured at the date of the grant
      by
      the option pricing model with the following assumptions for fiscal year 2006;
      the dividend yield is 0%, volatility is 20%, and the risk free interest rate
      is
      4%.




The
      fair
      values generated by option pricing model may not be indicative of the future
      values, if any, that may be received by the warrant holder.




There
      is
      no formal stock option plan for employees.




A
      list of
      warrants outstanding is as follows:


**Weighted Average**
              
              **Weighted Average****Amount**
              
              **Exercise Price**
              
              **Years to Maturity**Outstanding
                  at December 31, 2005
              
              
              40,062,000
              
              $
              0.37
              
              
              3.24Issued
              
              
              5,500,000Exercised
              
              
              (4,000,000
              )Expired
              
              
              0Outstanding
                  at December 31, 2006
              
              
              41,562,000
              
              $
              0.40
              
              
              2.72Issued
              
              
              0Exercised
              
              
              0Expired
              
              
              (5,800,000
              )Outstanding
                  at December 31, 2007
              
              
              35,762,000
              
              $
              0.36
              
              
              1.61




**10.
      Equity Credit Line**




In
      fiscal
      year 2005, the Company entered into an equity line credit agreement with Duchess
      Private Equities Ltd. (“Dutchess”), a financing company and the Company’s
      majority shareholder at December 31, 2007.  Duchess has agreed to lend the
      Company up to $25,000,000 through 2008. The Company has borrowed $4,753,349
      and
      $4,049,777 against the credit line at December 31, 2007 and December 31, 2006,
      respectively.




Under
      the
      terms of the equity line agreement, the Company is obligated to pay the face
      value of the equity line notes in cash or an equivalent amount in common stock.
      All of the assets of the Company secure the equity line notes. The notes have
      an
      effective interest rate of approximately 20%.  As an incentive to enter the
      equity line of credit, the Company also issued incentive convertible debentures,
      see reference footnote 11, the fair market value of which has been discounted
      against the face of the equity line notes and is being amortized to interest
      expense over the life of the equity line notes.




F-12





The
      following is the schedule of the equity line notes payable:




**2007**
            
            **2006**Matured
                in September 2006, effective interest of 18.55%
            
            $
            1,086,803
            
            $
            1,117,451Matured
                in November 2006, effective interest of 22.12%
            
            
            1,488,215
            
            
            1,489,520Matured
                in December 2006, effective interest of 22.12%
            
            
            129,885
            
            
            129,885Matured
                in April 2007, effective interest of 22.12%
            
            
            581,603
            
            
            639,554Matured
                in December 2007, effective interest of 17.34%
            
            
            1,042,651
            
            
            969,195Matures
                in March 2008, effective interest of 25.68%
            
            
            474,623
            
            
            0Less
                discount
            
            
            (50,430
            )
            
            (295,828
            )Total
                equity line of credit
            
            $
            4,753,349
            
            $
            4,049,777





At
      December 31, 2007, the Company is in default of the equity line notes by
      $4,329,156.  The equity line agreement provides for interest penalties in
      the event of a default.  The interest penalties at December 31, 2007 are
      $1,542,861 as per the agreement.  However at December 31, 2007, Duchess has
      agreed not to enforce any of the penalty provisions.




**11.
      Issuance of Incentive Convertible Debentures**




During
      the fiscal years ended December 31, 2006 and 2005, the Company issued incentive
      convertible debentures to the holders of the Equity Credit Line.  Under the
      guidance of, Derivative Implementation Group Issue No. K1, “ *Miscellaneous:
      Determining Whether Separate Transactions Should Be Viewed as a
      Unit* ”,
      the
      Company determined that the incentive debentures should be viewed as unit with
      the promissory notes issued on the Equity Credit Line.  These incentive
      debentures were not clearly and closely related to the host contracts, and
      have
      been bifurcated as derivative liabilities in accordance with SFAS No. 133,
      “ *Accounting
      for Derivative Instruments and Hedging Activities* ”. Therefore,
      as of December 31, 2007 and 2006, the Company had classified the fair value
      of
      all incentive debentures as a derivative liability.




During
      the fiscal year ended December 31, 2007, the Company issued a 12% incentive
      debenture with a face value of $500,000 to pay an incentive fee to the holder
      of
      the convertible debenture issued on December 26, 2007 (reference footnote 12).
       The incentive debenture was recorded as a discount to the convertible
      debenture at fair market value at the date of issuance to debt discount and
      will
      be amortized over the life of the convertible debenture.  The debenture is
      convertible into common stock at 75% of the lowest bid price of the common
      stock
      for the fifteen days preceding conversion.  The incentive debenture matures
      in December 2014.  At issuance, the incentive debenture was valued using a
      Black Scholes Option Pricing Model utilizing the following assumptions:
 volatility: 20%, straight bond yield: 5.0%, risk-free rate: 4.0%, and
      dividend growth rate: 0.  The fair market value will be assessed each
      balance sheet date over the maturity of the debenture and will be marked to
      market with the gain or loss recorded in the Company’s statement of
      operations.




During
      the fiscal year ended December 31, 2007, the Company issued a non-interest
      bearing incentive debenture with a face value of $140,000 to pay an incentive
      fee to the holder of the equity credit line.  The incentive debenture was
      recorded as a discount to the equity credit line at fair market value at the
      date of issuance to debt discount and will be amortized over the life of the
      equity credit line issuance.  The debenture is convertible into common
      stock at 75% of the lowest bid price of the common stock for the fifteen days
      preceding conversion.  The incentive debenture matures in March 2012.
 At issuance, the incentive debenture was valued using a Black Scholes
      Option Pricing Model utilizing the following assumptions:  volatility: 20%,
      straight bond yield: 5.0%, risk-free rate: 4.0%, and dividend growth rate:
      0.
 The fair market value will be assessed each balance sheet date over the
      maturity of the debenture and will be marked to market with the gain or loss
      recorded in the Company’s statement of operations.




During
      the fiscal year ended December 31, 2006, the Company issued non-interest bearing
      incentive convertible debentures with a face value of $471,875 to pay an
      incentive fee to the holder of the equity credit line. These debentures were
      recorded as a discount to the equity credit line at fair market value at the
      date of issuance to debt discount and will be amortized over the life of the
      equity credit line issuance. The debentures are convertible into common stock
      at
      75% of the lowest bid price of the common stock for the fifteen days preceding
      conversion.  The incentive debentures mature in April 2007 and June 2011.
      At issuance, the conversion feature was valued using a Black Scholes Option
      Pricing Model utilizing the following assumptions:  volatility: 20%,
      straight bond yield: 5.0%, risk-free rate: 2.0%, and dividend growth rate:
      0.
 The fair market value will be assessed each balance sheet date over the
      maturity of the debentures and will be marked to market with the gain or loss
      recorded in the Company’s statement of operations.




F-13




During
      the fiscal year ended December 31, 2005, the Company issued non-interest bearing
      incentive convertible debentures with a face value of $457,500 to pay an
      incentive fee to the holder of the equity credit line. These debentures were
      recorded as a discount to the equity credit line at fair market value at the
      date of issuance to debt discount and will be amortized over the life of the
      equity credit line issuance.  The debentures are convertible into common
      stock at 75% of the lowest bid price of the common stock for the fifteen days
      preceding conversion.  The debentures mature in fiscal year 2010. At
      issuance, the conversion feature was valued using a Black Scholes Option Pricing
      Model utilizing the following assumptions:  volatility: 20%, straight bond
      yield: 5.0%, risk-free rate: 2.0%, and dividend growth rate: 0.  The
      conversion option will be assessed each balance sheet date over the maturity
      of
      the debentures and will be marked to market with the gain or loss recorded
      in
      the Company’s statement of operations.




All
      derivative liabilities are assessed at each balance sheet date and are marked
      to
      market.  At December 31, 2007, the following assumptions were utilized in
      the fair market value assessment:  volatility: 20%, straight bond yield:
      5.0%, risk-free rate: 4.0%, and dividend growth rate: 0.




Maturities
      of the incentive debentures are as follows:




For
                the year ended December 31, 2008
            
            $
            171,875For
                the year ended December 31, 2009
            
            $
            0For
                the year ended December 31, 2010
            
            $
            457,500For
                the year ended December 31, 2011
            
            $
            300,000For
                the year ended December 31, 2012 and thereafter
            
            $
            640,000




**12.
       Issuance of Convertible Debentures**




On
      December 26, 2007, the Company issued a convertible debenture in the face amount
      of $2,100,000.  The debenture bears interest at 12% per annum and matures
      on December 26, 2014.  The Company shall make mandatory monthly payments of
      interest to the noteholder in an amount equal to the interest accrued on the
      principal balance of the debenture from the last interest payment until such
      time as the interest payment is due and payable.  The interest payment
      commenced on January 26, 2008 and continues until the debenture is paid in
      full.
 The noteholder has the right to convert any and all amounts owed into
      share of the Company’s common stock at any time following the closing date.
 The conversion price of the debenture is equal to the lesser of 75% of the
      lowest closing bid price of the common stock during the twenty trading days
      immediately prior to the notice of conversion, or $0.005. The noteholder shall
      be entitled to convert up into eighty-five percent of the total shares
      outstanding contingent on a 1000:1 Reverse Split.   As an inducement
      to the holder, the Company issued 700,000,000 shares of the Company’s common
      stock and 20,000,000 shares of the Company’s Series C Preferred Stock.  In
      addition, the Company also issued a $500,000 incentive debenture to the holder
      (reference footnote 11).  Both the shares of the company’s securities and
      the incentive debenture were recorded as a discount to the debt issuance and
      are
      amortized over the life of the convertible note.  At issuance, the
      conversion feature was accounted for under EITF 00-27, “ *Application
      of Issue No. 98-5 to Certain Convertible Instruments* ”.
      Although the conversion feature is convertible into an indeterminate number
      of
      shares, the noteholder holds a controlling interest in the Company.  Net
      share settlement can occur.  The conversion feature was calculated using
      the intrinsic value method and recorded as a debt discount.




On
      June
      11, 2007, the Company issued a convertible debenture in the face amount of
      $2,000,000.  The debenture bears interest at 12% per annum and matures on
      June 11, 2014.  The Company shall make mandatory monthly payments of
      interest to the noteholder in an amount equal to the interest accrued on the
      principal balance of the debenture from the last interest payment until such
      time as the interest payment is due and payable.  The interest payment
      commenced on July 1, 2007 and continues until the debenture is paid in full.
       The noteholder has the right to convert any and all amounts owed into
      share of the Company’s common stock at any time following the closing date.
 The conversion price of the debenture is equal to the lesser of 75% of the
      lowest closing bid price of the common stock during the twenty trading days
      immediately prior to the notice of conversion, or $0.015.  At issuance, the
      conversion feature was accounted for as a derivative liability in accordance
      with EITF 00-19 “ *Accounting
      For Derivative Instruments Indexed To, and Potentially Settled, In the Company’s
      Own Stock* ,”
due
      to
      the conversion feature permitting conversion into an indeterminate number of
      shares.  At issuance, the conversion feature was valued using a Black
      Scholes Option Pricing Model utilizing the following assumptions:
 volatility: 20%, straight bond yield: 5.0%, risk-free rate: 2.0%, and
      dividend growth rate: 0.  The conversion option will be assessed each
      balance sheet date over the maturity of the debentures and will be marked to
      market with the gain or loss recorded in the Company’s statement of operations.




F-14




As
      of
      December 26, 2007, the conversion feature is no longer accounted for as a
      derivative liability.  The noteholder owns a controlling interest in the
      Company, and has control to authorize additional shares as warranted.  The
      conversion liability was reclassified to additional paid in
      capital.




Maturities
      of the convertible debentures are as follows:




For
                the year ended December 31, 2014
            
            $
            4,100,000




**13.
      Income Tax Provision**




**2007**
            
            **2006**Provision
                for income taxes is comprised of the following:Net
                loss before provision for income taxes
            
            $
            (1,474,050
            )
            $
            (4,350,702
            )Current
                tax expense:Federal
            
            $
            0
            
            $
            0State
            
            
            0
            
            
            0Total
            
            $
            0
            
            $
            0Less
                deferred tax benefit:Timing
                differences
            
            
            (2,353,099
            )
            
            (5,356,647
            )Allowance
                for recoverability
            
            
            2,353,099
            
            
            5,356,647Provision
                for income taxes
            
            $
            0
            
            $
            0A
                reconciliation of provision for income taxes at the statutory rate
                to
                provision for income taxes at the Company’s effective tax rate is as
                follows:Statutory
                U.S. federal rate
            
            
            34
            %
            
            34
            %Statutory
                state and local income tax
            
            
            10
            %
            
            10
            %Less
                allowance for tax recoverability
            
            
            -44
            %
            
            -44
            %Effective
                rate
            
            
            0
            %
            
            0
            %Deferred
                income taxes are comprised of the following:Timing
                differences
            
            $
            2,353,099
            
            $
            5,356,647Allowance
                for recoverability
            
            
            (2,353,099
            )
            
            (5,356,647
            )Deferred
                tax benefit
            
            $
            0
            
            $
            0





Note:
       The deferred tax benefits arising from the timing differences begin to
      expire in fiscal years 2006 and 2027 and may not be recoverable upon the
      purchase of the Company under current IRS statutes.





**14.
      Commitments and Contingencies**




In
      the
      event of a default on the equity line of credit as discussed in Note 10, Duchess
      can secure a portion of the Company’s assets not to exceed 200% of the face
      amount of the credit line and can impose an interest penalty, which is
      $1,542,861 at December 31, 2007. Duchess can also elect to convert the unpaid
      balances of the equity credit line to three year convertible debentures at
      15%
      interest and with an exercise price of 50% of the lowest closing bid price
      for
      the Company’s stock for the fifteen days prior to conversion of the
      debentures.




At
      the
      date of this report, Duchess has elected not to enforce any of the default
      penalty provisions and management has made no provision for this contingency
      in
      the consolidated financial statements.




In
      December 2007, the Company issued a convertible debenture to Duchess for
      $2,100,000 maturing in December 2014 at an annual interest rate of 12%, payable
      each quarter.  In the event the Company’s earnings before interest, taxes,
      and depreciation and amortization (EBITDA) is in excess of $450,000, the Company
      is required to pay 20% of the excess towards the debenture.  Duchess is
      also entitled to receive 40% of the production proceeds of the Fant Ranch
      property (see Note 17) and the J.B. Tubb leasehold acquired in January 2008
      (see
      Note 19) for the next three years and 30% of the production of these assets
      thereafter until the debenture is paid in full.




F-15




**15.
       Gain on Sale of Asset**




In
      August
      2007, the Company sold all of its rights to certain projects in the Ukraine
      that
      had been developed through its subsidiary, Firecreek Petroleum Inc., to Star
      Energy Corp. for $100,000 cash and 2.1 million shares of Star’s stock.  The
      rights to these projects had previously been 100% impaired by the Company in
      2005 and therefore all the proceeds received from the transaction have been
      recorded as a “gain on asset sale” in the consolidated statement of operations.
 Management has classified the Star stock as “available for sale” as per
      SFAS No. 115, “ *Accounting
      for Certain Investments in Debt and Equity Securities* ”
and,
      accordingly, has recorded the loss in the market value of the stock in other
      comprehensive income at December 31, 2007.




**16.
      Non Cash Transactions**




Certain
      transactions during the years ended December 31, 2007 and December 31, 2006
      did
      not involve the use of cash and therefore have been excluded from the
      consolidated statements of cash flows.




During
      the year ended December 31, 2006, the Company issued 58,555,432 shares of common
      stock to pay $1,165,098 of the equity credit line discussed in Note
      10.




During
      the year ended December 31, 2007, the Company issued 78,747,315 shares of common
      stock to pay $280,378 of the equity credit line discussed in Note
      10.




**17.
      Supplemental Information on Natural Gas Operations**




In
      November 2005, the Company purchased a 50% working interest in The Ten Mile
      Draw
      Field, a natural gas field located in Sweetwater County, Wyoming for $1,089,130.
       Of the total acquisition costs $475,000 was used to acquire the lease,
      $126,000 was used for well equipment costs, and $488,130 for development costs.




On
      July
      9, 2007, the Company acquired certain tracts of land and leases located in
      Knox
      County, Texas, known as the Fant Ranch Unit for $1,538,705 which included wells,
      leases and equipment and the oil in the tanks owned by the seller at that
      time.




The
      following is a summary of the Company’s natural gas production activities at
      December 31, 2007 and at December 31, 2006 representing the Company’s net
      revenue interests.




F-16




**Reserve
        Quantity Information**
 **Proved
        Developed and Undeveloped Reserves:** **(All
          United States Based)**


**2007**
            
            **2006****Oil**
            
            **Gas**
            
            **Oil**
            
            **Gas****(Barrels)**
            
            **(Mcf)**
            
            **(Barrels)**
            
            **(Mcf)**Beginning
                of Year
            
            
            0
            
            
            1,040,022
            
            
            n/a
            
            
            947,191Revisions
            
            
            -3,004
            
            
            14,216
            
            
            n/a
            
            
            120,884Improvements
            
            
            0
            
            
            0
            
            
            n/a
            
            
            0Purchases
            
            
            71,774
            
            
            0
            
            
            n/a
            
            
            0Extensions
            
            
            0
            
            
            0
            
            
            n/a
            
            
            0Production
            
            
            -4,061
            
            
            -25,238
            
            
            n/a
            
            
            -28,053End
                of Year
            
            
            64,709
            
            
            1,029,200
            
            
            n/a
            
            
            1,040,022




Proved
      Developed Reserves:




**2007**
            
            **2006****Oil**
            
            **Gas**
            
            **Oil**
            
            **Gas****(Barrels)**
            
            **(Mcf)**
            
            **(Barrels)**
            
            **(Mcf)**Beginning
                of Year
            
            
            0
            
            
            344,739
            
            
            n/a
            
            
            239,861End
                of Year
            
            
            64,709
            
            
            312,189
            
            
            n/a
            
            
            344,739


**Results
        of operations (All United States Based):**


**2007**
              
              **2006**Revenues
              
              $
              451,514
              
              $
              146,831Production
                  costs
              
              
              -257,679
              
              
              -112,657Exploration
                  costs
              
              
              0
              
              
              0Development
                  costs
              
              
              -130,551
              
              
              -524,969Depreciation
                  & amortization
              
              
              -129,921
              
              
              -55,732Provision
                  for income tax
              
              
              0
              
              
              0Net
                  profit (loss) from oil and gas producing activities:
              
              $
              (66,637
              )
              $
              (546,526
              )
 **Capitalized
          cost of oil and gas producing activities:**
  **2007**
              
              **2006**Proved
                  oil and gas lease properties
              
              $
              1,068,650
              
              $
              475,000Well
                  Equipment
              
              
              1,316,710
              
              
              403,732Accumulated
                  depreciation
              
              
              -150,430
              
              
              -75,254Net
                  capitalized costs of natural gas producing activities
              
              $
              2,234,930
              
              $
              803,477
 
 **Costs
          incurred for property acquisitions, exploration, and
          development:**
  **2007**
              
              **2006**Property
                  acquisition
              
              $
              1,506,628
              
              $
              0Proved
              
              
              0
              
              
              0Unproved
              
              
              0
              
              
              0Exploration
              
              
              0
              
              
              0Development
              
              
              120,736
              
              
              524,969Total
              
              $
              1,627,364
              
              $
              524,969
 **Changes
          in discounted future cash flows of proved reserves:**
  **2007**
              
              **2006**Future
                  cash flows
              
              $
              13,978,098
              
              $
              6,242,579Future
                  production costs
              
              
              -8,716,030
              
              
              -3,732,949Future
                  income tax expense
              
              
              -1,105,034
              
              
              -528,178Future
                  net cash flows
              
              
              4,157,034
              
              
              1,981,45210%
                  annual discount
              
              
              -1,323,971
              
              
              -665,372Standardized
                  measure of discounted future net cash flows
              
              $
              2,833,063
              
              $
              1,316,080




F-17





**18.
       Related Party Transactions**




During
      fiscal years 2007 and 2006, the chief executive officer and shareholder provided
      office space to the Company at no charge.




During
      fiscal years 2007 and 2006, two shareholders had unsecured non-interest bearing
      advances receivable from the Company. The Company has imputed an interest rate
      of 20% on these advances.




The
      Company is indebted to Duchess Private Equities Ltd., currently the majority
      stockholder, for $8,918,332 at December 31, 2007.  The debt is in the form
      of the equity line notes discussed in Note 10 and the convertible debentures
      discussed in Note 11.  Interest expense on the loans for fiscal years 2007
      and 2006 is $1,215,278 and $1,174,907, respectively.   The Company is
      in default on these loans for $4,329,156 at December 31, 2007, which results
      in
      interest penalties of $1,542,861 as per the equity line agreement.
 However, Duchess has agreed not to enforce any of the interest penalty
      provisions on the defaulted liabilities at December 31, 2007.




**19.
      Subsequent Events**




In
      January 2008, the Company, through it’s wholly owned subsidiary, Firecreek
      Petroleum, Inc, purchased a certain 40 acre tract of land and leases  with
      first right for an additional 40 acre lease located in Ward County, Texas,
      more
      commonly known as the J.B. Tubb Leasehold Estate.  The Company paid
      $1,400,000 for the lease, equipment and a Participation Agreement which provides
      for turnkey drilling, re-entry and includes multiple wells.




Also
      in
      January of 2008, the Company appointed Messes. Michael Novielli, Douglas
      Leighton, Theodore Smith and Douglas D’Agata to the Company’s Board of Directors
      in compliance with the terms Dutchess debenture issued December 26, 2007
      referred to in Note 12.




F-18


**ITEM
              8.**
            **CHANGES
                IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
                DISCLOSURE**




None




**ITEM
              8A.**
            **CONTROLS
                AND PROCEDURES**




EGPI
      Firecreek, Inc. is responsible for establishing and maintaining adequate
      internal control over financial reporting. EGPI Firecreek, Inc. internal control
      over financial reporting is a process designed to provide reasonable assurance
      regarding the reliability of financial reporting and the preparation of
      financial statements for external purposes in accordance with generally accepted
      accounting principles. Because of its inherent limitations, internal control
      over financial reporting may not prevent or detect misstatements. Also,
      projections of any evaluation of effectiveness to future periods are subject
      to
      the risk that controls may become inadequate because of changes in conditions,
      or that the degree of compliance with the policies or procedures may
      deteriorate.




EGPI
      Firecreek, Inc. management assessed the effectiveness of the Company’s internal
      control over financial reporting as of December 31, 2007. Management has
      attempted designed such disclosure controls and procedures as defined under
      Rule
      13a-13(e) promulgated under the Securities and Exchange Act of 1934 as amended,
      to ensure that material information is made known to them, particularly during
      the period in which this report was prepared. During fiscal year 2007,
      management discovered certain errors made to the Company’s consolidated
      financial statements for the fiscal years ended December 31, 2006 and 2005.
      Such errors, as more fully described in this annual report, in the Company’s
      consolidated financial statements are deemed by management to have occurred
      due
      to material weaknesses in the Company’s controls and procedures. Accordingly,
      based on our assessment we have concluded that, as of December 31, 2007,
      the Company’s internal control over financial reporting were not effective based
      on those criteria outlined under the Securities Exchange Act. The Company has
      taken steps to remediate these material weaknesses, including engaging an
      outside consulting firm to assist with certain complex accounting of the
      Company’s convertible securities.




The
      Company’s President and Chief Financial Officer, the (“Certifying Officer”) has
      evaluated the effectiveness of the Company’s disclosure controls and procedures
      within 90 days of the end of the period covered by this report and believe
      that
      the Company’s disclosure controls and procedures were not effective based on the
      required evaluation as of the end of the period covered by this Report. It
      was
      determined that the Company’s accounting for the convertible debentures issued
      during the fourth quarter of 2005, and during the years ended 2006 and 2007
      were
      not in accordance with U.S. generally accepted accounting principles.
 Specifically, the incentive debenture and the conversion features were not
      bifurcated and classified as a derivative liability in the consolidated balance
      sheets.  The corresponding debt discount should be amortized to interest
      expense over the life of the host convertible debenture.




To
      correct the deficiency the Company, during the first quarter of 2008, engaged
      outside consultants to assist accounting restatements for the periods indicated
      above, and for future complex accounting matters that may arise. The Company
      expended approximately $16,300 for the consulting services, and expects to
      accrue additional expenses quarterly for these ongoing services.




The
      changes in internal controls during the last fiscal quarter, and corrective
      actions taken with regard to deficiencies included obtaining and implementing
      controls around complex accounting transactions, such as accounting for
      derivative liabilities. Management has in the first fiscal of 2008, engaged
      an
      outside accounting firm to oversee the function.




**ITEM
              8B.**
            **OTHER
                INFORMATION**




None


35





**PART
      III**


**ITEM
              9.**
            **DIRECTORS,
                EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
                SECTION
                16(a) OF THE EXCHANGE ACT**




The
      directors, executive officers and significant employees of the Company as of
      March 31, 2008 are as follows:





**NAME**
            
            **AGE**
            
            **POSITION
                WITH COMPANY**Dennis
                R. Alexander
            
            54
            
            Chairman,
                President, and CFO of the Company, Firecreek Petroleum, Inc., and
                Director
                of IYSG ltd.Douglas
                Leighton
            
            39
            
            Director
                of the CompanyRupert
                C. Johnson
            
            58
            
            Director
                of the CompanyMichael
                Novielli
            
            43
            
            Director
                of the CompanyDermot
                McAtamney
            
            52
            
            Director,
                Executive Vice President, and Co-Treasurer of the Company, and Firecreek
                Petroleum, Inc.Theodore
                Smith
            
            31
            
            Director
                of the CompanyDouglas
                D ’ Agata
            
            37
            
            Director
                of the CompanyMelvena
                Alexander
            
            74
            
            Co-Treasurer,
                Secretary and Comptroller of the Company and Firecreek Petroleum,
                Inc.Dr.
                Mousa Hawamdah
            
            58
            
            Director
                of the Company and Firecreek Petroleum, Inc. -Libyan Government
                Advisor





Term
      for
      Directors: In accordance with Article 9.2 of the Company’s Bylaws: The members
      of the Board of Directors shall hold office until the first annual meeting
      of
      Stockholders and until their successors shall have been elected and qualified.
      At the first annual meeting of Stockholders and at each annual meeting
      thereafter the Stockholders shall elect Directors to hold office until the
      next
      succeeding annual meeting, except in the case of classification of the
      Directors. Each Director shall hold office for the term for which he is elected
      until his successor shall have been elected and qualified.




*Dennis
      R. Alexander* has
      served as Chairman, President and CFO of the Company and Firecreek Petroleum,
      Inc. since February 10, 2007. He served as Chairman and CFO of the Company
      and
      Firecreek Petroleum, Inc. since July 1, 2004 through February 9, 2007 having
      served as the President and Director of the Company from May 18, 1999 to June
      30, 2004. In September 1998 he was a founder, and from January 19, 1999 through
      its acquisition with the Company served as President and Director of Energy
      Producers Group, Inc. From April 1997 through March 1998, served as CEO,
      Director, Consultant of Miner Communications, Inc., a media communications
      company. From April 26, 1997 through March, 1998 he was a director of Rockline,
      Inc., a private mining, resource company, and a founder of World Wide Bio Med,
      Inc., a private health-bio care, start up company. Since March 1996 to the
      present he has owned Global Media Network USA, Inc., which has included
      management consulting, advisory services. Mr. Alexander devotes approximately
      60
      to 80 hours per week minimum, and more as required, to the business of the
      Company.




*Douglas
      Leighton* has been
      a member of the Board of Directors of the Company since February 1, 2008.
 Doug is a co-founder and principal of Dutchess Capital Management LLC
      (“DCM”) and its predecessor firm Dutchess Advisors, Ltd., which since 1996 had
      arranged private equity and debt financings for publicly traded-companies.
      Since
      2000, he has overseen the trading, investment due diligence, transaction
      structure, and risk management of DCM managed Funds and is a member of the
      firm's Investment Committee. Doug has over 16 years of experience in securities,
      investment banking and asset management. In 1990 he received a combined Bachelor
      of Arts and Bachelor of Science degree in Economics and Finance from the
      University of Hartford.




*Rupert
      C. Johnson* has
      served as a Director of the Company since October 4, 2005. Mr. Johnson is the
      General Manager of the Tirion Group, Inc., based in Switzerland, which is
      engaged in business processes in the Resources Sector, with its concentration
      towards Oil and Metals in production and marketing related activities. Tirion
      has assisted the Company’s Strategic operations, corporate objectives, and
      provided funding. Mr. Johnson has extensive experience in Consulting and
      Investments through his business interests in resources and trading. He has
      developed projects in oil products in the Middle East, Southern Africa and
      Central Europe. Mr. Johnson’s concentration is towards cash producing
      investment, working with investment funds and other sources of finance. He
      has
      working relationships with several oil, mining and oil trading entities. Tirion
      holds small interests in certain trading and mining ventures. Mr. Johnson was
      formerly founding CEO and largest private shareholder of a trading and
      investment business involved in the oil, chemical and metal, and agricultural
      sectors in the Sub Saharan African continent known as the EXTRADE Group. The
      group’s base was mainly operated from Cape Town and
      Johannesburg for the African Region and internationally from the UK and
      Switzerland The group developed substantial trade and supportive investments
      in
      petroleum in refining, storage and retail, storage and land investments in
      Agriculture. The group also developed partnerships with multi-national
      associated business entities based in several African countries, Singapore,
      Germany, Switzerland, Argentina and Brazil, Black Sea countries and in the
      Middle East. The group which commenced business in 1985, was, prior to its
      dissolution commencing in 2001/2, one of the largest privately owned businesses
      in the Southern African region employing over 1000 staff and with assets in
      excess of $100 million. Several of the unbundled businesses remain today in
      controlling roles in their activities in certain regions in the Sub Saharan
      continent.




36




*Michael
      Novielli* has been
      a member of the Board of Directors of the Company since February 1, 2008. Mike
      is a co-founder and principal of Dutchess Capital Management LLC (“DCM”) and its
      predecessor firm Dutchess Advisors, Ltd., which since 1996 had arranged private
      equity and debt financings for publicly traded-companies. Since 2000, he has
      overseen transaction structure, risk management and regulatory compliance for
      DCM managed Funds and is a member of the firm's Investment Committee. Mike
      has
      over 15 years experience in securities, investment banking and asset management
      including tenure with PaineWebber (now UBS). He received a Bachelor of Science
      degree in Business from the University of South Florida in 1987.




*Dermot
      L. McAtamney* has
      served as a Director, Executive Vice President, and Co-Treasurer of the Company
      and Firecreek Petroleum, Inc. since February 10, 2007, and as a Director of
      the
      Company since January 21, 2007. He has served on the Finance Committee of the
      Company since November 30, 2005 and the Shareholder and Investor Relations
      Committee since April 8, 2006. Mr. McAtamney has also served on the Executive,
      Legal, Compensation and Stock Option committees since January 21, 2007. From
      June 2004 to the present Mr. McAtamney has been a consultant to the Company,
      acting in various capacities related to finance structuring, business review,
      and assisting the Board of Directors. From June 1999 to June 2004, Mr. McAtamney
      worked privately as a consultant to various companies acting as financial
      advisor to them in their efforts to perfect business plans and raise capital
      through private equity transactions. Mr. McAtamney brings over 25 years of
      financial experience to the Company having begun his career with the Federal
      Reserve Bank of New York in the foreign exchange department in 1979. Over the
      years, Mr. McAtamney has actively traded international currency and bond markets
      at institutions such as Bank of Montreal, Continental Grain and Shearson Lehman.
      Mr. McAtamney graduated from St. John’s University with a BA in Economics in
      1978.




*Theodore
      Smith* has been
      a Director of the Company since February 1, 2008.  Mr. Smith has been the
      director of Corporate Finance of Dutchess Private Equities Fund since June
      1998.  He graduated with a BS in marketing and finance from Boston College
      in 1999.




*Douglas
      D ’ Agata* has been
      a Director of the Company since February 1, 2008.  Mr. D ’ Agata is the
      Director of Research for Dutchess Private Equities Fund since 2004.  From
      1998 to 2004, he was a financial advisor at Prudential Securities.  Mr. D ’
Agata graduated from Hobart College with a degree in Political Science in 1993
      and received a masters in finance from Bentley College in 2004.




*Melvena
      Alexander* has
      served as Co-Treasurer, Secretary and Comptroller of the Company and Firecreek
      Petroleum, Inc. since February 10, 2007 having served as Secretary and
      Comptroller of the Company and Firecreek Petroleum, Inc. since July 1, 2004
      through February 9, 2007. She served as Secretary since March 15, 2003 to June
      30, 2004 having been Secretary and Comptroller of the Company since May 18,
      1999. In September 1998 she was a founder, and from January 19, 1999 through
      the
      acquisition processes with the Company served as Secretary of Energy Producers
      Group, Inc. She is founder and President of Melvena Alexander CPA since 1982,
      which prepares financial statements and tax reports. From October 1998 through
      April 16, 2004 she worked in the Department of Patient Finance at Arizona State
      Hospital as an Accounting Technician 11. Mrs. Alexander graduated Arizona State
      University with a B.S. in Accounting, received CPA Certificate, State of
      Arizona. She is a member of AICPA and the American Society of Women Accountants.
      Mrs. Alexander devotes a minimum of 40-60 hours per week, and more as required,
      to the business of the Company.




*Dr.
      Mousa Hawamdah* has been
      a Director since July 1, 2004, and Chairs the Audit Committee. He has been
      a
      Libyan Political envoy, since July 1, 2004, and was an officer of the Company
      and Firecreek Petroleum, Inc. until December 29, 2004. Dr. Mousa is the
      President and significant shareholder GAMA Oil and Gas, Inc., a Libyan
      corporation that is domesticated in Ottawa, Canada. He was born in Libya and
      became a U.S. citizen in 1982. Dr. Mousa has a Bachelor’s Degree from San Jose
      State University in Geology. He has a Master’s and Doctorate Degree in Physics
      from Georgetown University.




Effective
      on January 21, 2007, greater than a majority of the Board of Directors of the
      Company approved certain changes to its established committees to fill certain
      vacancies during 2006, based on a previous reorganization that included
      restructuring, and the creation of certain committees.




37




Family
      Relationships




Dennis
      R.
      Alexander, Chairman, President, and CFO is the son of Melvena Alexander,
      Co-Treasurer, Secretary and Comptroller.




Committees
      Of The Board Of Directors




The
      Board
      of Directors has the following committees: Audit, Nominating, Executive,
      Projects, Compensation and Stock Option, Administration and Legal, Finance,
      and
      Shareholder and Investor Relations.




In
      2008
      we are again in process of evaluating various committee structures, and persons
      capable of becoming independent seat(s), and to provide for more independent
      committee function ability and standards.




That
      the
      Audit Committee is composed of two members: Dr. Mousa Hawamdah, its Chairman,
      and Mrs. Joanne Sylvanus, a consultant, member.




The
      responsibilities of the Audit Committee include: (1) the recommendation of
      the
      selection and retention of the Company’s independent public accountants; (2) the
      review of the independence of such accountants; (3) to review and approve any
      material accounting policy changes affecting the Company’s operating results;
      (4) the review of the Company’s internal control system; (5) the review of the
      Company’s annual financial report to stockholders; and (6) the review of
      applicable interested party transactions.




The
      Committee formed to act as the Nominating Committee is composed of two members
      of the Board of Directors: Messrs. Alexander, its Chairman, and Johnson, member.




The
      function of the Nominating Committee is to seek out qualified persons to act
      as
      members of the Company’s Board of Directors, and provide for compliance
      standards. The Nominating Committee seeks to identify director candidates based
      on input provided by a number of sources, including (a) the Nominating Committee
      members, (b) our other Directors, (c) our stockholders, and (d) third parties
      such as professional search firms. In evaluating potential candidates for
      director, the Nominating Committee considers the merits of each candidate’s
      total credentials.




The
      Executive Committee is composed of three members of the Board of Directors:
      Messrs. Johnson, its Chairman, Alexander, member, and McAtamney,
      member.




The
      function of the Executive Committee is to exercise all power and authority
      of
      the Board of Directors, except as limited by the Company’s by-laws or applicable
      law, and further in accordance with the Company’s Corporate Governance
      Guidelines.




The
      Projects Committee is composed of two members of the Board of Directors: Messrs.
      Johnson, its Chairman, and Alexander, member.




The
      function of the Projects Committee is to propose new oil and gas projects for
      consideration by the Executive Committee and to coordinate with the Finance
      Committee to present a joint recommendation for such projects to the Executive
      Committee and the Board of Directors. Upon approval of a project, the Projects
      Committee coordinates with the Finance Committee and appropriate entities and
      persons, including management, lenders and project operators, to oversee and
      manage the accomplishment of approved projects.




The
      Committee formed to act as the Compensation and Stock Option Committee is
      composed of three members of the Board of Directors: Messrs. Alexander, its
      Chairman, Johnson, member and McAtamney, member.




The
      function of the Compensation and Stock Option Committee is to review and
      recommend along with the Board of Directors, compensation and benefits for
      the
      executives of the Company, consultants, and administers and interprets the
      Company Stock Option Plan and the Directors Stock Option Plan and are authorized
      to grant options pursuant to the terms of these plans.




The
      Committee formed to act as the Administration and Legal Committee is composed
      of
      two members: Joanne Sylvanus, its Chairman, a consultant, Dermot McAtamney,
      member.




The
      function of the Administration and Legal Committee is to supervise matters
      relating to staff and administration, personnel, payroll, facilities, equipment
      and systems.




The
      Committee formed to act as the Finance Committee is composed of three members
      of
      the present Board of Directors: Messrs. McAtamney, its Chairman, Alexander,
      member, Johnson, member.




38




The
      function of the Finance Committee is to oversee financial affairs of the Company
      and make recommendations to the Executive Committee and Board of Directors
      regarding financial affairs and policies of the Company, seek funding for
      approved projects, and track use of funds for projects and
      operations.




The
      Committee formed to act as the Shareholder and Investor Relations Committee
      is
      composed of two members: Mr. Joseph M. Vasquez III, its Chairman, a consultant,
      and Dermot McAtamney, member.




The
      function of the Shareholder and Investor Relations Committee is to assist the
      Executive Committee and the Board of Directors in maintaining good relations
      with the Company’s shareholders and investors, and disseminating information
      regarding the Company’s activities.




**COMPLIANCE
      WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934**




Section
      16(a) of the Securities Exchange Act of 1934 requires the Company’s officers and
      directors, and persons who own more than ten percent of the Company’s Common
      Stock, to file reports of ownership and changes in ownership with the Securities
      and Exchange Commission (“SEC”). Officers, directors and greater than ten
      percent stockholders are required by SEC regulations to furnish the Company
      with
      copies of all Section 16(a) forms they file.




Based
      solely on current management’s review of the copies of such forms received by it
      from former management, the Company believes that, during the year ended
      December 31, 2007, its officers, directors, and greater than ten-percent
      beneficial owners complied with all applicable filing requirements.




**Code
      of Ethics**




On
      December 31, 2003, the Company adopted its Code of Ethics and Business Conduct
      that applies to all of the officers, directors and/or employees of the Company.
      The Code of Ethics is included and filed as Exhibit 14 to our Form-10KSB filed
      on April 27, 2004 incorporated herein for reference. The Code is posted on
      our
      website (www.egpifirecreek.com) currently in continuous stages of upgrade
      development/construction. We will disclose on our completed website any waivers
      of, or amendments to, our Code.




**ITEM
              10.**
            **E****XECUTIVE
                COMPENSATION**




The
      following tables summarize annual and long-term compensation paid to the
      Company’s Chief Executive Officer and the Company’s four other most highly
      compensated executive officers whose total annual salary and bonus compensation
      exceeded $100,000 who were serving as of December 31, 2007 for all services
      rendered to the Company and its subsidiaries during each of the last three
      fiscal years. The Company did not retain any employees and payments are made
      for
      services as available. The Company through Firecreek Petroleum, Inc. retained
      approximately eight employees during the first quarter of Fiscal Year 2006.
      All
      other tables required to be reported have been omitted, as there has been no
      compensation awarded to, earned by or paid to any of the executives of the
      Company that is required to be reported other than what is stated
      below.




All
      shares beneficially owned by the named executives below listed are bound by
      terms of a Voting Agreement (please see “Exhibit 99.3” to a Report on Form 8-K
      filed April 7, 2005 incorporated herein by reference).




39





**Summary
      Compensation Table**





**Name
                and**
              **Principal
                Position**
            
            **Year**
            
            **Salary****($)**
            
            **Stock**
              **Awards****($)**
            
            **Option**
              **Awards****($)**
            
            **All Other**
              **Compensation****($)**Dennis
                R. Alexander**13/**(*)
            
            
            2007
            
            
            n/a
            
            
            n/a
            
            
            -0-
            
            
            -0-Chairman,
                President, CFO**1/9/11/**
            
            
            2006
            
            
            n/a
            
            
            n/a
            
            
            -0-
            
            
            148,750
            **2/6/**2005
            
            
            n/a
            
            
            n/a
            
            
            -0-
            
            
            144,000
            **4/7/**Melvena
                Alexander**13/**(*)
            
            
            2007
            
            
            n/a
            
            
            n/a
            
            
            -0-
            
            
            -0-Co
                Treasurer, Sect. and Cmpt.**10/12/**
            
            
            2006
            
            
            n/a
            
            
            n/a
            
            
            -0-
            
            
            21,250
            **3/6/**2005
            
            
            n/a
            
            
            n/a
            
            
            -0-
            
            
            83,200
            **5/8/**





1/
            As
                part of an agreement with Firecreek Petroleum, Inc. for the Exchange
                of
                Common Stock Dated July 29, 2004, all named executives listed in
                the table
                received provisions and rights for facilitation fees, on completion
                of
                certain events, and terms to be established, as listed therein Section
                9.
                d. of the agreement filed July 16, 2004 on Form 8-K as exhibit 21.1
                thereto and incorporated for reference. Please also see “Certain
                Relationships and Related Transactions”.2/
            The
                amounts in this column for 2006 represents the aggregate value of
                common
                restricted stock issued on December 8, 2006 to the named executive.
                $148,750 of the amount listed in this row for 2006 represents the
                value of
                the shares issued to D.R. Alexander for services rendered, based
                on the
                closing market prices on or near such dates of $0.0085 per
                share.3/
            The
                amounts in this column for 2006 represents the aggregate value of
                common
                restricted stock issued on December 8, 2006 to the named executive.
                $21,250 of the amount listed in this row for 2006 represents the
                value of
                the shares issued to Melvena Alexander for services rendered, based
                on the
                closing market prices on or near such dates of $0.0085 per
                share.4/
            The
                amounts in this column for 2005 represents the aggregate value of
                series C
                preferred stock issued to the named executive on April 5, and July
                12,
                2005, based on the then closing market prices on or near such dates
                of
                $.02 and $.076 per share, respectively; $144,000 of the amount listed
                in
                this row for 2005 represents the aggregate value of shares received
                by
                D.R. Alexander for the issuance of 150,000 shares of sub-series C-1,
                and
                150,000 shares of sub-series C-2 of series C preferred stock, on
                April 5,
                and July 12, respectively. Series C preferred converts 1:10 into
                common
                restricted stock, six months from the date of issuance, in accordance
                with
                its rights and preferences. Each share of the sub-series C-1 of series
                C
                preferred issued to the named executive converted to ten shares of
                common
                restricted stock on October 5, 2005. Each share of the sub-series
                C-2 of
                series C preferred issued to the named executive converted to ten
                shares
                of common restricted stock on January 12, 2006.5/
            The
                amount in this column for 2005 represents the value of the common
                restricted stock underlying sub-series C-2 of series C preferred
                stock on
                July 12, 2005 issued to the named executive; $83,200 of the amount
                listed
                in this row for 2005 represents the value of the shares issued to
                Melvena
                Alexander for services rendered, based on the closing market prices
                on or
                near such dates of $0.076. Melvena Alexander received a total of
                110,000
                shares of sub-series C-2 of series C preferred on July 12, 2005 which
                converted to ten shares of common restricted stock on January 12,
                2006.6/
            D.R.
                Alexander and Melvena Alexander received 17,500,000 and 2,500,000
                shares
                of restricted stock on December 8, 2006, respectively.7/
            D.R.
                Alexander received 1,500,000 shares of common restricted stock on
                October
                5, 2005, and 1,500,000 shares of common restricted stock on January
                12,
                2006 as a result of the conversion of 150,000 shares of C-1 of series
                C
                preferred issued April 5, 2005, and 150,000 shares of C-2 of series
                C
                preferred issued July 12, 2005, respectively.




40





8/
            Melvena
                Alexander received 1,100,000 shares of common restricted stock on
                January
                12, 2006 as a result of the conversion of 110,000 shares of C-2 of
                series
                C preferred issued July 12, 2005.9/
            Mr.
                Alexander holds a total of 17,500,000 shares of common restricted
                stock as
                of December 31, 2006. The market value of the 17,500,000 shares on
                December 31, 2007 and December 31, 2006 was $35,000 and $148,750,
                respectively. No dividends are paid on the restricted common stock
                held.10/
            Melvena
                Alexander holds a total of 2,500,000 shares of common restricted
                stock as
                of December 31, 2006. The market value of the 2,500,000 shares on
                December
                31, 2007 and December 31, 2006 was $5,000 and $21,250, respectively.
                No
                dividends are paid on the restricted common stock held.11/
            Mr.
                Alexander holds a total of 3,000,000 shares of common restricted
                stock as
                a result of the conversion in the aggregate of C-1, and C-2 of series
                C
                preferred to common, as of December 31, 2006. The market value of
                these
                shares on December 31, 2007 and December 31, 2006 was $6,000 and
                $25,500,
                respectively. No dividends are paid on the restricted common stock
                held.12/
            Melvena
                Alexander holds a total of 1,100,000 shares of common restricted
                stock as
                a result of the conversion in the C-2 of series C preferred to common,
                as
                of December 31, 2006. The market value of these shares on December
                31,
                2007 and December 31, 2006 was $2,200 and $9,350, respectively. No
                dividends are paid on the restricted common stock held.13/
            D.R.
                Alexander and Melvena Alexander have been with the Company since
                1999.(*)
            Please
                see “Certain Relationships and Related Transactions” for additional
                discussion on agreements with individual consulting
                firms.




**Options**




The
      following table provides information related to options held by our named
      executive officers during the fiscal year ended December 31, 2007.




Option
      Awards




**Name**
            
            **Number
                of** **Securities****Underlying Unexercised****Options (#)****Exercisable**
            
            **Number of****Securities Underlying****Unexercised****Options (#)****Unexercisable**
            
            **Option****Exercise****Price ($)**
            
            **Option****Expiration****Date**Dennis
                R. Alexander (1) (4)Chairman, President, CFO
            
            
            2,000,000
            
            
            N/A
            
            
            0.70
            
            
            2/9/2009Dennis
                R. Alexander (2) (4)Chairman, President, CFO
            
            
            600,000
            
            
            N/A
            
            
            0.95
            
            
            11/30/2007Melvena
                Alexander (3) (4)Co Treasurer, Sect. and Cmpt.
            
            
            500,000
            
            
            N/A
            
            
            0.95
            
            
            11/30/2007




41





(1)
      The
      date of the option agreement with the named executive listed above in the table
      for 2,000,000 shares underlying unexercised options is August 9, 2004; i) The
      option exercise price is $.70 per share; ii) The expiration date of the option
      agreement is four years from the date of Vesting; iii) The Vesting Date is:
      For
      and after the expiration of on hundred eighty (180) days following the date
      of
      the agreement or February 9, 2005; iv) the Expiration Date for the option
      agreement 2/9/2009; v) The market price for the underlying restricted common
      stock on August 9, 2004, the date of grant, and December 31, 2006, was $0.10,
      and $0.0085, respectively; and vi) The exercise price of the options is equal
      to
      or in excess of the fair market value of the stock on the date of
      grant.




(2)
      The
      date of the option agreement with the named executive listed above in the table
      for 600,000 shares underlying unexercised options is September 30, 2000; i)
      The
      option exercise price is $.95 per share; ii) The expiration date of the option
      agreement is seven years from the date of Vesting; iii) The Vesting Date is:
      Sixty (60) days following the date of the agreement or November 30, 2000; iv)
      the Expiration Date for the option agreement 11/30/2007; v) The market price
      for
      the underlying restricted common stock on September 30, 2000, the date of grant,
      and December 31, 2006, was $0.125, and $0.0085, respectively; and vi) The
      exercise price of the options is equal to or in excess of the fair market value
      of the stock on the date of grant. These options have expired as of November
      30,
      2007.




(3)
      The
      date of the option agreement with the named executive listed above in the table
      for 500,000 shares underlying unexercised options is September 30, 2000; i)
      The
      option exercise price is $.95 per share; ii) The expiration date of the option
      agreement is seven years from the date of Vesting; iii) The Vesting Date is:
      Sixty (60) days following the date of the agreement or November 30, 2000; iv)
      the Expiration Date for the option agreement 11/30/2007; v) The market price
      for
      the underlying restricted common stock on September 30, 2000, the date of grant,
      and December 31, 2006, was $0.125, and $0.0085, respectively; and vi) The
      exercise price of the options is equal to or in excess of the fair market value
      of the stock on the date of grant. These options have expired as of November
      30,
      2007.




(4)
      For
      all option grants listed in the table above the following provision applys:
      If
      at any time after the date of this Agreement and prior to the expiration of
      all
      Exercise Period(s), the Company proposes to file a registration statement to
      register any Common Stock (other than Common Stock issued with respect to any
      acquisition or any employee stock option, stock purchase or similar plan) under
      the Securities Act of 1933, as amended (the “Securities Act”) for sale to the
      public in an underwritten offering, it will at each such time give prior written
      notice to the Optionee of its intention to do so (“Notice of Intent”) and, upon
      the written request of the Optionee made within 30 calendar days after the
      receipt of any such notice (which request must specify the number of Option
      Shares Optionee requests) to be included in the registration, the Company will
      use its best efforts to effect the registration under the Securities Act of
      the
      Option Shares which the Company has been so requested to register, provided,
      however, that if the managing underwriter shall certify in writing that
      inclusion of all or any of the Option Shares would, in such managing
      underwriter’s opinion, materially interfere with the proposed distribution and
      marketing of the Common Stock in respect of which registration was originally
      to
      be effected (such writing to state the basis of such opinion and the maximum
      number of shares which may be distributed without such interference), then
      the
      Company may, upon written notice to the Optionee, have the right to exclude
      from
      such registration such number of Option Shares which it would otherwise be
      required to register hereunder as is necessary to reduce the total amount of
      Common Stock to be so registered to the maximum amount which can be so
      marketed.




**Employee
      Pension, Profit Sharing or Other Retirement Plans**




The
      Company does not have a defined benefit, pension plan, profit sharing, or other
      retirement plan.




**Director
      Compensation**




As
      of
      February 4, 2000 each member of the Board of Directors, subject to approval
      of
      the Chairman and CEO, may be paid $500.00 per formal meeting plus certain
      expenses for out of State Directors incurred in connection with attendance
      at
      Board and Committee meetings. There are no agreements provided to Directors
      or
      individual agreements with any Director other than that presented in this
      paragraph, and the understanding that at minimum a traveling Director will
      be
      considered by the Chairman more favorably for reimbursement of expenses for
      travel and may, at the election of the Chairman, be paid $500 for attendance
      at
      a formal meeting. This determination by the Chairman to provide for either
      reimbursement or compensation for a formal meeting is principally to be based
      on
      the finances of the Company available at the time.




**Employment
      Agreements**




The
      Company does not have any employment agreements with its executive
      officers.




42





**ITEM
              11.**
            **SECURITY
                OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                MANAGEMENT**




The
      following table sets forth certain information regarding the beneficial
      ownership of the Company’s Securities by each person or group that is known by
      the Company to be the beneficial owner of more than five percent of its
      outstanding Securities, each director of the Company, each executive officer,
      and all directors and executive officers of the Company as a group as of March
      31, 2008. Unless otherwise indicated, the company believes that the persons
      named in the table below, based on information furnished by such owners, have
      sole voting and investment power with respect to the Common Stock beneficially
      owned by them, where applicable.




Under
      securities laws, a person is considered to be the beneficial owner of securities
      owned by him (or certain persons whose ownership is attributed to him) and
      that
      can be acquired by him within 60 days from the date of this Form 10-KSB filing,
      including upon the exercise of options, warrants or convertible securities.
      The
      Company determined a beneficial owner’s percentage ownership by assuming that
      options, warrants or convertible securities that are held by him, but not those
      held by any other person, and which are exercisable within 60 days of the date
      of this Form 10-KSB filing, have been exercised or converted.




The
      information in the following table is based on 1,184,257,619 shares of common
      stock issued and outstanding as of March 31, 2008.




**Title
                of Class**
            
            **Name
                and Address**
              **Beneficial
                Owner**
            
            **Beneficial**
              **Ownership**
            
            **Percent**
              **of
                Class**Common
            
            Dennis
                R Alexander **/***
            
            29,412,500
            * (1)
            2.12
            %6564
                Smoke Tree LaneScottsdale,
                Arizona 85253Common
            
            Rupert
                C. Johnson **
            
            87,846,340
            (2)
            6.35
            %P.O.
                Box 34616
                Place Des Eaux-Vives1211Geneva
                3SwitzerlandCommon
            
            Dutchess
                Private Equities Fund, Ltd.
            
            703,213,667
            (3)
            50.80
            %50
                Commonwealth Avenue, Suite 2Boston,
                MA 02116.Preferred
            
            Dutchess
                Private Equities Fund, Ltd.
            
            200,000,000
            (4)
            14.45
            %50
                Commonwealth Avenue, Suite 2Boston,
                MA 02116.Common
            
            Michael
                Novielli
            
            903,213,667
            (4)
            65.25
            %Common
            
            Douglas
                Leighton
            
            903,213,667
            (4)
            65.25
            %Common
            
            Theodore
                Smith
            
            
            *
            
            *Common
            
            Douglas
                D’Agata
            
            
            *
            
            *Common
            
            Dr.
                Mousa Hawamdah**
            
            11,270,174
            *
                (5)
            0.81
            %6777
                Camp Bowie Blvd. Suite 332Fort
                Worth, TX 76116Common
            
            Dermot
                McAtamney**
            
            18,350,000
            (6)
            1.33
            %c/o
                6564 Smoke Tree LaneScottsdale,
                Arizona 85253Common
            
            Melvena
                Alexander**
            
            4,815,000
            *
                (7)
            0.35
            %c/o
                6564 Smoke Tree LaneScottsdale,
                Arizona 85253Common
                and Preferred
            
            All
                Officers and Directors
              as
                a Group (**7-Persons)
            
            1,054,907,681
            
            76.21
            %




43




*
      Persons
      noted by the underlined asterisk in the preceding table, and corresponding
      footnotes, are also part of and bound by a voting agreement, along with other
      shareholders.




***As
      of
      December 26, 2008 Mr. Dennis Alexander, the Company’s Chairman and Chief
      Financial Officer, agreed to pledge all shares beneficially owned by him as
      collateral for all amounts owing by the Company to Dutchess Private Equities
      Fund, Ltd. (“Dutchess”), and further, as then conditioned by the status,
      disposition, and terms of the *voting agreement (please see “Exhibit 99.3” to a
      Report on Form 8-K filed April 7, 2005 incorporated herein by
      reference).




(a)
      For
      all Persons in the preceding table, and corresponding footnotes: Options,
      warrants, and preferred stock as applicable, are included in calculations as
      to
      each person’s beneficial ownership position.




(1)*
      Includes 27,412,500 shares owned directly by Mr. Alexander, including 300,000
      in
      the name of his wife, Deborah L. Alexander. There are 50,000 shares in the
      name
      of Ashton Alexander and 50,000 shares in the name of Sarah Alexander, his two
      minor children, and he has voting power over 50,000 in the name of Aaron
 Alexander, and 50,000 in the name of Julie Alexander-Schumacher, his
      wife’s adult children. Also reflected in the table are 2,000,000 shares of
      common restricted stock under presently exercisable stock options which may
      be
      purchased by Mr. Alexander after February 9, 2005. Not included in the table
      are
      600,000 shares of common restricted stock under then presently exercisable
      stock
      options, which were available for purchase by Mr. Alexander after November
      30,
      2000, and as previously reported. These options have expired unexercised on
      November 30, 2007.




(2)
      Includes 16,500,000 shares Received directly by Mr. Johnson, along with
      67,996,340 shares in which Mr. Johnson has voting power over the shares by
      virtue of being the General Manager of Tirion Group, Inc., the actual owner
      of
      the shares. Also reflected in the table: i) Tirion indirectly controls warrants
      to purchase 2,000,000 shares of common stock and has voting and dispositive
      power over the shares. Common shares underlying these presently exercisable
      warrants may be purchased by Tirion Group, Inc. after May 18, 2005; ii) As
      of
      February 2006, Tirion Group Inc. indirectly owns by virtue of an assignment,
      warrants to purchase 3,350,000 shares of common stock and has voting and
      dispositive power over the shares by virtue of Mr. Johnson being the General
      Manager of Tirion Group, Inc., the actual owner of these shares. Not reflected
      in the table: Warrants owned indirectly by Tirion to purchase 2,000,000 shares
      of common stock of which expired on May 18, 2007. Tirion had previously reported
      voting and dispositive power over such shares.




(3) Includes
      shares owned by Dutchess Private Equities Fund, Ltd. is a corporation formed
      under the laws of the Cayman Islands.  Douglas Leighton and Michael
      Novielli are the Directors of Dutchess Private Equities Fund, Ltd. and are
      members of the Company’s Board of Directors and, as such, they have voting and
      dispositive power over the securities beneficially owned by such entity. For
      further information please see information listed in Form 13-D filed on January
      29, 2008. Also includes underlying shares of common stock to the Company’s
      Series C Preferred Stock which converts on the basis of one share of preferred
      stock for ten (10) shares of common stock. For further information please see
      information listed in Form 13-D filed on January 29, 2008.




(4)
      Consists of 703,213,667 shares of common stock and 200,000,000 shares of Series
      C Common Stock underlying Series C Preferred Stock.




(5)*
      Includes 9,270,174 shares owned directly by Dr. Hawamdah. Also included are
      2,000,000 shares of common restricted stock under presently exercisable stock
      options, which may be purchased by Mr. Hawamdah after February 9,
      2005.




(6)
      Includes 15,000,000 shares owned directly by Mr. McAtamney.  Mr. McAtamney
      indirectly owns warrants to purchase 3,350,000 shares of common stock and has
      voting and dispositive power over the shares by virtue of being the principal
      of
      DLM Asset Management, Inc., the beneficial owner of these shares. Common shares
      underlying these presently exercisable warrants may be purchased by DLM Asset
      Management, Inc. after June 14, 2005.




(7)*
      Includes 4,815,000 shares owned directly by Mrs. Alexander. 500,000 shares
      of
      common restricted stock under exercisable stock options, which were available
      for purchase by Mrs. Alexander after November 30, 2000 as previously reported,
      subsequently having expired unexercised on November 30, 2007.




**ITEM
              12.**
            **CERTAIN
                RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
                INDEPENDENCE.**




**Transactions
      with Executive Management; Fiscal Year Ended December 31, 2007, December 31,
      2006, and December 31, 2005.**




Please
      see “EXECUTIVE COMPENSATION” section of this document related to transactions in
      addition to those contained in this section including, rights and provisions,
      grants and bonus, additional consideration and other compensation for the
      following named executives: Dennis R. Alexander, Chairman, President, and Chief
      Financial Officer and Director, and Melvena Alexander, Co Treasurer,
      Comptroller, and Secretary.




44


**Transactions
      with Former Executive Management, For The Fiscal Years Ended December 31, 2007,
      December 31, 2006, and December 31, 2005 respectively.**




For
      additional information other than that furnished in this section regarding:
      Current Officer and Director Dennis R. Alexander, Chairman, President, and
      CFO,
      and former Officers and Directors John R. Taylor, President and Director,
      William E. Merritt, Executive Vice President, General Counsel and Director
      please see information under Item 10 – “Executive Compensation” and other
      information contained in Form 10-KSB filed April 14, 2006, incorporated herein
      by reference; For former Officers and Directors George B. Faulder, former Vice
      President and Director of the Company and Firecreek Petroleum; and, Gregg
      Fryett, former CEO and Director of the Company and Firecreek Petroleum, and
      International Yacht Sales Group, LTD., please see information under Item 10
–
“Executive Compensation” and other information contained in Form 10-KSB filed
      April 12, 2005, incorporated herein by reference.




**Contracts**




The
      Company has verbal and month to month contracts with various entities (owned
      by
      related parties) to provide accounting, management, and other professional
      services. The entities, their owners and their amounts are as follows for the
      fiscal year ended December 31, 2007 listed in Table 1 below, and for the fiscal
      years ended December 31, 2006, and December 31, 2005 listed in Table 2
      below.




**Table
      1**


***Paid**
              
              **Accrued****Entity**
              
              **Related
                  Party**
              
              **2007**
              
              **2007**Global
                  Media Network USA, Inc.
              
              Dennis
                R. Alexander (1)
              
              $
              89,750
              
              $
              120,250Tirion
                  Group, Inc.
              
              Rupert
                C. Johnson (2)
              
              $
              7,000
              
              $
              43,000Melvena
                  Alexander, CPA
              
              Melvena
                Alexander (3)
              
              $
              59,250
              
              $
              43,875DLM
                  Asset Management, Inc.
              
              Dermot
                McAtamney (4)
              
              $
              55,200
              
              $
              3,300




*Part
      of
      the amounts paid in 2007 for each of the above named Executives were for the
      unpaid accrual amounts due from 2006.


(1)
              Dennis
                  R. Alexander, Chairman, President, and CFO, and is a shareholder
                  of the
                  Company.(2)
              Rupert
                  C. Johnson, Director, and is a Co- shareholder of the
                  Company.(3)
              Melvena
                  Alexander, Secretary, Co Treasurer, Secretary and Comptroller,
                  and is a
                  shareholder of the Company.(4)
              Dermot
                  McAtamney, Director, Executive Vice President, Co Treasurer, and
                  is a
                  shareholder of the Company.




**Table
      2**




**Paid**
              
              **Accrued****Entity**
              
              **Related
                  Party**
              
              **2006**
              
              **2005**
              
              **2006**
              
              **2005**Global
                  Media Network USA, Inc.
              
              
              Dennis
                  R. Alexander (1)
              
              **$**
              138,000
              
              $
              133,250
              
              $
              30,000
              
              $
              -0-Tirion
                  Group, Inc.
              
              
              Rupert
                  C. Johnson (2)
              
              
              50,000
              
              
              -0-
              
              
              20,000
              
              
              -0-Melvena
                  Alexander, CPA
              
              
              Melvena
                  Alexander (3)
              
              **$**
              86,750
              
              $
              78,300
              
              $
              13,250
              
              $
              -0-DLM
                  Asset Management, Inc.
              
              
              Dermot
                  McAtamney (4)
              
              
              80,800
              
              
              -0-
              
              
              22,500
              
              
              -0-Angro
                  Holding Ltd f/k/a Able Marine, Ltd.
              
              
              Gregg
                  Fryett (5)
              
              **$**
              -0-
              
              $
              100,000
              
              $
              -0-
              
              $
              -0-




45




(1)
              Dennis
                  R. Alexander, Chairman and CFO, and is a shareholder of the
                  Company.(2)
              Rupert
                  C. Johnson, Director, and is a Co- shareholder of the
                  Company.(3)
              Melvena
                  Alexander, Secretary and Comptroller, and is a shareholder of the
                  Company.(4)
              Dermot
                  McAtamney, Director, Executive Vice President, Co Treasurer, and
                  is a
                  shareholder of the Company.(5)
              Gregg
                  Fryett, Chief Executive Officer until November 30, 2005, and Director
                  through December 31, 2005, and shareholder of the
                  Company.




**Related
      Party Transaction(s) Involving Issuance of Shares both preferred and common,
       promissory notes, and convertible debentures as of December 31, 2007,
      December 31, 2006, and December 31, 2005 with** Dutchess
      Private Equities Fund, Ltd. (“DPEF”), Douglas Leighton (“Leighton”) and Michael
      Novielli (“Novielli”, together with DPEF and Leighton, “Dutchess”) each with a
      business address of 50 Commonwealth Avenue, Suite #2, Boston, MA 02116.
 Messrs. Leighton and Novielli are the Directors of DPEF.




Information
      required under this section can be found in previously filed documents:




Note:
      As
      reported by Dutchess please also see information contained in Form 13-D filed
      January 29, 2008.




1.
      Current Report on form 8-K filed on January 7, 2008, incorporated herein by
      reference.




2.
      Current Report on Form 8-K filed on June 19, 2007, incorporated herein by
      reference.




3.
      Current Report on Form 8-K filed on March 29, 2007, incorporated herein by
      reference.




4.
      Current Report on Form 8-K filed on July 7, 2006, incorporated herein by
      reference.




5.
      Current Report on Form 8-K filed on April 27, 2006, incorporated herein by
      reference.




6.
      Current Report on Form 8-K filed on December 16, 2005, incorporated herein
      by
      reference.




7.
      Current Report on Form 8-K filed on November 16, 2005, incorporated herein
      by
      reference.




8.
      Current Report on Form 8-K filed on September 13, 2005, incorporated herein
      by
      reference.




**Shares,
      Options, and Warrants Issued During The Fiscal Year Ended December 31, 2006
      to
      Officers, Directors, and Consultants.**




Information
      required under this section can be found in previously filed
      documents:




1.
      Current Report on Form 8-K filed on January 12, 2006




2.
      Current Report on Form 8-K filed on February 3, 2006




3.
      Current Report on Amended 8-K/A filed on March 17, 2006




4.
      Post
      Effective amendments for registration statement filed on April 26,
      2006




5.
      Current Report on Form 8-K filed on December 12, 2006 for earliest date of
      event
      on December 7, 2006




6.
      Current Report on Form 8-K filed on December 13, 2006 for earliest date of
      event
      on December 8, 2006




**Indirect
      Third Party Consulting Fee Arrangement with Director**




On
      June
      14, 2005 the Board of Directors of the Company approved the signing of a Fee
      Protection Agreement with DLM Asset Management (“DLM”) in connection with
      utilizing DLM in the area of raising various forms of financing and business
      development. Pursuant to the Agreement, we are required to pay to DLM ten
      percent (10%) cash compensation and ten percent  (10%) warrant compensation
      on the first $4,000,000 that the Company receives. As of June 16, 2005 the
      Company has paid in the aggregate a total of $400,000, excluding expenses,
      to
      DLM on behalf of its plan of finance with Tirion Group, Inc., which includes
      other term provisions with DLM listed in our Registration Statement on Form
      SB-2/A declared effective on September 7, 2005 and incorporated by reference
      hereto. Of the aggregate total of $400,000 paid to DLM, approximately $200,000
      was paid to Tirion Group, Inc. of which Rupert C. Johnson, a Director of the
      Company, is a manager thereof.




46


**Salary
      to Former Officers and Directors**




Former
      Officers and Directors John R. Taylor, President and Director of the Company
      and
      Firecreek Petroleum, William E. Merritt, Executive Vice President, General
      Counsel and Director of the Company and Firecreek Petroleum, and George B.
      Faulder, a Vice President and Director of the Company and Firecreek Petroleum,
      all of which are Shareholders of the Company, received salaries in the amount
      of
      USD $25,000, USD $ 25,000, and USD $20,000 respectfully, during 2006  (see
      other related compensation and non compensation stock issuances to John R.
      Taylor, William E. Merritt, and George B. Faulder listed in this
      section).




**Salary
      to Former Vice President and Director**




George
      B.
      Faulder, a former Vice President and Director of the Company and Firecreek
      Petroleum, and a Shareholder of the Company, received salary in the amount
      of
      USD $55,000 during 2005 (see other related compensation and non compensation
      stock issuances to George B. Faulder listed in this section).




**Preferred
      Stock Issuances**




As
      part
      of an agreement with Firecreek Petroleum, Inc. for the Exchange of Common Stock
      Dated July 29, 2004, all named executives in the table below received provisions
      and rights for facilitation fees, on completion of certain events, and certain
      terms to be established, as provided in the agreement filed July 16, 2004 on
      Form 8-K as exhibit 21.1 thereto and incorporated for reference.




On
      April
      5 and July 12, 2005, by majority consent of the Board of Directors and
      applicable committees approved the following issuances of its Sub-Series C-1
      and
      C-2 of Sub Series C Preferred Stock, par value $0.001 per share, to the
      following persons. The shares were issued pursuant to a private placement and
      carry a rule 144 legend. The shares were issued pursuant to an exemption from
      registration as provided in Section 4(2) of the Securities Act of 1933. For
      description of Rights and Preferences as to C-1 of Sub Series C Preferred stock
      please see Exhibit 99.2 to a Current Report on Form 8-K filed April 7, 2005;
      and, as to C-2 of Sub Series C Preferred Stock please see Exhibit 99.2 to a
      Current Report on Form 8-K, as amended, filed initially on July 14, 2005, both
      incorporated herein by reference. The shares are covered under a Voting
      Agreement (please see “Exhibit 99.3” to a Current Report on Form 8-K filed April
      7, 2005, incorporated herein by reference). The shares of Sub-Series “C-1” of
      Series C Preferred Stock and shares of Sub-Series “C-2” of Series C Preferred
      Stock listed in the immediately following table held by each of the named
      executives converted to common restricted stock on a 1:10 basis on October
      5,
      2005 and January 12, 2006, respectively.




(*)See
      Notes Below Table.


**Name**
              
              **Date(s)**
              
              **Share**
                **Amount**
              
              **Type of**
                **Consideration**
              
              **Fair Market Value**
                **of Consideration**
              
              **Value of**
                **Underlying**
                **Common Stock ($)**George
                  B. Faulder (1)
              
              4/05/05
              
              150,000/a
              
              Preferred
                  Stock
              
              $
              1500
              
              $
              30,0006777
                  Camp Bowie Blvd.
              
              7/12/05
              
              150,000/b
              
              in
                  exchange for
              
              $
              1500
              
              $
              114,000Suite
                  215
              
              
              
              
              
              Rights
                  in connectionFort
                  Worth, TX 76116
              
              
              
              
              
              with
                  the Company’sacquisition
                  of FPIGregg
                  Fryett (2)
              
              4/05/05
              
              150,000/a
              
              Preferred
                  Stock
              
              $
              1500
              
              $
              30,00050
                  Reddenhill Road
              
              7/12/05
              
              150,000/b
              
              in
                  exchange for
              
              $
              1500
              
              $
              114,000Torquay
              
              
              
              
              
              Rights
                  in connectionDevon
                  TQ1 3RR
              
              
              
              
              
              with
                  the Company’sUnited
                  Kingdom
              
              
              
              
              
              acquisition
                  of FPIJohn
                  R. Taylor (3)
              
              4/05/05
              
              150,000/a
              
              Preferred
                  Stock
              
              $
              1500
              
              $
              30,0006777
                  Camp Bowie Blvd.
              
              7/12/05
              
              150,000/b
              
              in
                  exchange for
              
              $
              1500
              
              $
              114,000Suite
                  215
              
              
              
              
              
              Rights
                  in connectionFort
                  Worth, TX 76116
              
              
              
              
              
              with
                  the Company’sacquisition
                  of FPIWilliam
                  E. Merritt (4)
              
              4/05/05
              
              150,000/a
              
              Preferred
                  Stock
              
              $
              1500
              
              $
              30,0006777
                  Camp Bowie Blvd.
              
              7/12/05
              
              150,000/b
              
              in
                  exchange for
              
              $
              1500
              
              $
              114,000Suite
                  215
              
              
              
              
              
              Rights
                  in connectionFort
                  Worth, TX 76116
              
              
              
              
              
              with
                  the Company’sacquisition
                  of FPI




47




**/a** Shares
      of Sub-Series “C-1” of Series C Preferred Stock




**/b** Shares
      of Sub-Series “C-2” of Series C Preferred Stock




(*)
      $288,000 of the financing proceeds in the immediately preceding table were
      used
      primarily for additional consideration in exchange for a partial amount of
      the
      Rights established for services in connection with the Company’s acquisition of
      FPI.




Each
      named person’s established rights therein remaining is agreed to be reduced by
      $150,000 each on April 5, and July 12, 2005, respectively, and such amount
      of
      rights in the aggregate are cancelled accordingly.




(1)
      George B. Faulder is the former Vice President and a Director of the Company
      and
      Firecreek Petroleum, and a Shareholder of the Company.




(2)
      Gregg
      Fryett is the former Chief Executive Officer and a Director of the Company,
      Firecreek Petroleum, and International Yacht Sales Group, LTD., and a
      Shareholder of the Company.




On
      July
      12, 2005, by majority consent of the Board of Directors, the Compensation and
      Stock Option Committee, and the Executive Management Committee, the Registrant
      approved the following issuances of its Sub-Series C-2 Preferred Stock, par
      value $0.001 per share, to the following persons. The shares were issued
      pursuant to a private placement and carry a rule 144 legend. The shares were
      issued pursuant to an exemption from registration as provided in Section 4(2)
      of
      the Securities Act of 1933. For description of Rights and Preferences see
      Exhibit 99.2 to a Current Report on Form 8-K, as amended, filed initially on
      July 14, 2005, incorporated herein by reference.




(*)(See
      Notes Below Table))




**Name**
              
              **Date(s)**
              
              **Share****Amount**
              
              **Type of**
                **Consideration**
              
              **Fair Market Value**
                **of Consideration**
              
              **Value of**
                **Underlying**
                **Common Stock ($)**Melvena
                  Alexander(**)(1)
              
              7/12/05
              
              110,000
              
              Preferred
                  Stock
              
              $
              1100
              
              $
              83,6006564
                  Smoke Tree Ln
              
              
              
              
              
              in
                  consideration ofScottsdale,
                  Arizona 85253
              
              
              
              
              
              services
                  rendered tothe
                  Company or FPIGeorge
                  B. Faulder(**)(2)
              
              7/12/05
              
              110,000
              
              Preferred
                  Stock
              
              $
              1100
              
              $
              83,6006777
                  Camp Bowie Blvd.
              
              
              
              
              
              in
                  consideration ofSuite
                  215
              
              
              
              
              
              services
                  rendered toFort
                  Worth, TX 76116
              
              
              
              
              
              the
                  Company or FPIGregg
                  Fryett(**)(3)
              
              7/12/05
              
              110,000
              
              Preferred
                  Stock
              
              $
              1100
              
              $
              83,60050
                  Reddenhill Road
              
              
              
              
              
              in
                  consideration ofDevon
                  TQ1 3RR
              
              
              
              
              
              services
                  rendered toUnited
                  Kingdom
              
              
              
              
              
              the
                  Company or FPIJohn
                  R. Taylor(**)(4)
              
              7/12/05
              
              110,000
              
              Preferred
                  Stock
              
              $
              1100
              
              $
              83,6006777
                  Camp Bowie Blvd.
              
              
              
              
              
              in
                  consideration ofSuite
                  215
              
              
              
              
              
              services
                  rendered toFort
                  Worth, TX 76116
              
              
              
              
              
              the
                  Company or FPIWilliam
                  E. Merritt(**)(5)
              
              7/12/05
              
              110,000
              
              Preferred
                  Stock
              
              $
              1100
              
              $
              83,6006777
                  Camp Bowie Blvd.
              
              
              
              
              
              in
                  consideration ofSuite
                  215
              
              
              
              
              
              services
                  rendered toFort
                  Worth, TX 76116
              
              
              
              
              
              the
                  Company or FPI




(*)
      $250,300 of the financing proceeds in the immediately preceding table were
      used
      primarily in consideration of services rendered to the Company or Firecreek
      Petroleum.




48


(1)
      Melvena Alexander is Secretary and Comptroller of the Company and Firecreek
      Petroleum, and a Shareholder of the Company.




(2)
      George B. Faulder is a former Vice President and Director of the Company and
      Firecreek Petroleum, and a Shareholder of the Company.




3)
      Gregg
      Fryett is the former Chief Executive Officer and a Director of the Company,
      Firecreek Petroleum, and International Yacht Sales Group, LTD., and a
      Shareholder of the Company.




(4)
      John
      R. Taylor is the former President and a Director of the Company, and Firecreek
      Petroleum, and a Shareholder of the Company.




(5)
      William E. Merritt, Executive Vice President, General Counsel and Director
      of
      the Company and Firecreek Petroleum, and a Shareholder of the
      Company.




(**)
      The
      shares are covered under the terms of the Voting Agreement listed in Exhibit
      99.3 to a Current Reports on Form 8-K, filed April 7, 2005, and incorporated
      by
      reference thereto. Each of the Preferred shares listed in the immediately
      preceding table held by each of the named executives converted to common
      restricted stock on a 1:10 basis on January 12, 2006.




**Option
      Issuances**




The
      following table provides information related to options granted, vesting to
      our
      former named executive officers during the fiscal year ended December 31,
      2005.




**Name**
            
            **Number of**
              **SecuritiesUnderlying****OptionsGranted (#)a/b/**
            
            **% of Total**
              **Options Granted**
              **in Fiscal Year**
            
            **Exercise**
              **or Base**
              **Price ($/sh)**
            
            **Expiration**
              **Date**John
                R. Taylor
            
            
            2,000,000
            
            
            11.76
            %
            
            
            
            $
            .70
            
            
            2/9/09William
                E. Merritt
            
            
            2,000,000
            
            
            11.76
            %
            
            
            
            $
            .70
            
            
            2/9/09Gregg
                Fryett
            
            
            2,000,000
            
            
            11.76
            %
            
            
            
            $
            .70
            
            
            2/9/09George
                B. Faulder
            
            
            2,000,000
            
            
            11.76
            %
            
            
            
            $
            .70
            
            
            2/9/09





a /
      The
      market price for the underlying restricted common stock on August 9, 2004,
      the
      date of grant, and December 31, 2005, for all grants listed in the table was
      $0.10, and $0.03 respectively.




b /
      Including those executives listed in the above table, the total number of
      options vesting in the Fiscal Year 2005 to all officers, consultants, directors,
      and advisors, either affiliated or non affiliated, was 17,000,000.




The
      following are excerpts from certain provisions contained in the option agreement
      with the persons listed above, and include but are not limited to the following:




(1)
      The
      date of all agreements set forth in the table above is August 9,
      2004.




(2)
      The
      exercise price for all option agreements is $.70 per share.




(3)
      The
      expiration of each of the agreements is four (4) years from the date of Vesting.




(4)
      The
      Vesting Date is: For and after the expiration of on hundred eighty (180) days
      following the date of the agreement or February 9, 2005.




(5)
      The
      Expiration Date for all option agreements is 2/9/2009.




(6)
      The
      exercise price of the options is equal to or in excess of the fair market value
      of the stock on the date of grant.




(7)
      For
      all option grants listed in the table above the following provision is provided:
      If at any time after the date of this Agreement and prior to the expiration
      of
      all Exercise Period(s), the Company proposes to file a registration statement
      to
      register any Common Stock (other than Common Stock issued with respect to any
      acquisition or any employee stock option, stock purchase or similar plan) under
      the Securities Act of 1933, as amended (the “Securities Act”) for sale to the
      public in an underwritten offering, it will at each such time give prior written
      notice to the Optionee of its intention to do so (“Notice of Intent”) and, upon
      the written request of the Optionee made within 30 calendar days after the
      receipt of any such notice (which request must specify the number of Option
      Shares Optionee requests) to be included in the registration, the Company will
      use its best efforts to effect the registration under the Securities Act of
      the
      Option Shares which the Company has been




49


so
      requested to register, provided, however, that if the managing underwriter
      shall
      certify in writing that inclusion of all or any of the Option Shares would,
      in
      such managing underwriter’s opinion, materially interfere with the proposed
      distribution and marketing of the Common Stock in respect of which registration
      was originally to be effected (such writing to state the basis of such opinion
      and the maximum number of shares which may be distributed without such
      interference), then the Company may, upon written notice to the Optionee, have
      the right to exclude from such registration such number of Option Shares which
      it would otherwise be required to register hereunder as is necessary to reduce
      the total amount of Common Stock to be so registered to the maximum amount
      which
      can be so marketed.




Aggregated
      Option Exercises in Last Fiscal Year and Fiscal Year-End Option
      Value


**Name**
              
              **Shares**
                **Acquired**
                **On**
                **Exercise**
              
              **Value**
                **Realized**
              
              **Number of**
                **Securities**
                **Underlying**
                **Unexercised**
                **Options**
              
              **Value of**
                **Unexercised**
                **In-the-money**
                **Options**John
                  R. Taylor
              
              
              —
              
              
              —
              
              
              2,000,000
              
              
              —William
                  E. Merritt
              
              
              —
              
              
              —
              
              
              2,000,000
              
              
              —Gregg
                  Fryett
              
              
              —
              
              
              —
              
              
              2,000,000
              
              
              —George
                  B. Faulder
              
              
              —
              
              
              —
              
              
              2,000,000
              
              
              —




Unsecured,
      Demand Note Payable to John R. Taylor, President and Director, for loans made
      to
      Firecreek Petroleum, Inc. Total for the note is $316,483 at December 31, 2004.
      The note is current at March 31, 2005, and thereafter reduced to $59,531 at
      December 31, 2005. Additional loans were incurred in Q1 2006 totaling $15,162,
      and in Q2 2006 totaling $15,934. The additional loans carry 6% interest rates.
      Total balance owed including interest at the rate of 6% is $108,027 at December
      31, 2006. The note is current at March 31, 2007. The note is due on
      demand.




Unsecured,
      Demand Note Payable to George B. Faulder IV, former Vice-President and Director,
      for loans made to Firecreek Petroleum. Total for the note is $59,389 at December
      31, 2005. Additional loans were incurred in Q1 2006 totaling $19,189, and in
      Q2
      2006 $3,862. The additional loans carry 6% interest rates. Total balance owed
      including interest at the rate of 6% is $68,084 at December 31, 2006. The note
      is current at March 31, 2007. The note is due on demand.




Unsecured,
      Demand Note Payable to Big Boat Company, U.K., a company owned by Gregg Fryett,
      the former Chief Executive Officer of the Company, as part of the acquisition
      of
      IGH and IYSG. Total for the note is approximately USD$240,118 based on the
      then
      conversion rate (British Pound Sterling to USD) at December 31, 2004. The note,
      its principal and interest, was paid in full at September 30, 2005.




Promissory
      Notes Payable to Thomas J. Richards, formerly an advisory member through April
      2004. Total for all notes owed is $146,525, the principal balance. The notes,
      and all principal and interest, were paid in full at June 17, 2005.




Unsecured,
      Demand Note Payable to Dennis R. Alexander, Chairman and CFO, and then
      President, director and shareholder for cash funds loaned to the Company in
      the
      amount of $109,780. The notes principal and interest was paid in full at
      December 31, 2005.




Unsecured,
      Demand Note Payable to Melvena Alexander, CPA, Secretary and Comptroller for
      accrued services for the Fiscal Year ended 2002 in the amount of $60,000. The
      note principal and interest is paid in full as of December 31, 2005.




Promissory
      Notes payable to Larry W. Trapp, a former director of the Company through April
      26, 2004, and currently a shareholder of the Company. A note in the amount
      of
      $14,200 was issued June 1, 2001 with interest at 12% per annum. A second note
      in
      the amount of $22,000 was issued August 16, 2002 with interest at 12%. Both
      notes, and their respective principal and interest, were paid in full in June
      2005.




Convertible
      debenture note in the principal amount of USD $4,000,000, due to Tirion Group,
      Inc. Rupert C. Johnson, principal of Tirion Group, Inc. is also a Director
      of
      the Company as of October 4, 2005. The note and its principal and interest
      were
      paid in full by conversion to common stock in September 2005.




50


The
      Chief
      Executive Officer and Shareholder of the Company provided corporate office
      space
      through 2004 at no charge. During the last quarter of 2005, the Company paid
      $5,132 for approximately 1,431 square feet of office space utilized for its
      headquarters located at 6564 Smoke Tree Lane, Scottsdale, Arizona 85253. There
      is no further agreement in place to pay for the premises. At December 31, 2006,
      and December 31, 2007 the premises continue to be provided free of
      charge.




The
      former CEO or Managing Director of International Yacht Sales Group, Ltd. (IYSG),
      and former Chief Executive Officer and Director of the Company Mr. Gregg Fryett,
      provided office space located at 50 Reddenhill Road, Torquay Devon TQ1 3RR
      United Kingdom, for the IYSG management operations, free of charge until the
      end
      of fiscal year 2004. The Company discontinued IYSG in late 2005 and Mr. Fryett
      then terminated as CEO of the Company, and IYSG.




The
      former President, and Director of Firecreek Petroleum, and former President,
      Director, and Shareholder of the Company Mr. John R. Taylor provided co-sharing
      of approximately 1963 square feet of office space through a non affiliated
      family company at no charge through May 31, 2005. In May 2005, the Company’s
      wholly-owned subsidiary, Firecreek Petroleum headquartered at 6777 Camp Bowie
      Blvd S-215, Ft. Worth, TX 76116, became the lessee of office space in Fort
      Worth, Texas. The lease is for 24 months from June 1, 2005 through May 31,
      2007.
      Basic monthly rent is $7,053 and approximately $49,361 has been paid from June
      through December 2005. The offices were closed by Firecreek Petroleum, Inc.
      approximately March 31, 2006. The Firecreek Petroleum, Inc. subsidiary
      operations, wholly owned by the Company, were then moved to the Parent Company
      offices in Scottsdale Arizona. Firecreek Petroleum, Inc. remains liable under
      the terms of the original lease until expiration of the lease on May 31, 2007,
      unless otherwise negotiated; see also additional discussion and information
      contained in Item 3, Legal Proceedings included in this Report listed under
      the
      title Legal Proceedings, Texas Litigation, Hickman Investments,
      Ltd.




**ITEM
              13.**
            **EXHIBITS**


**ExhibitNo.**
              
              **Description**2.1
              
              Agreement
                  for the Exchange of Common Stock, dated December 12, 2003 (relating
                  to the
                  acquisition of International Group Holdings, Inc.) (filed as exhibit
                  2.1
                  to the Current Report on Form 8-K dated December 1, 2003, filed
                  December
                  15, 2003 and incorporated herein by reference).2.2
              
              Agreement
                  for the Exchange of Common Stock, dated June 29, 2004 (relating
                  to
                  acquisition of Firecreek Petroleum, Inc.) (filed as exhibit 2.1
                  to Current
                  Report on form 8-K dated June 24, 2004, filed July 15, 2004 and
                  incorporated herein by reference).3.1
              
              Articles
                  of Amendment to Articles of Incorporation of EGPI Firecreek, Inc.
                  (filed
                  as Exhibit 99.1 to Current Report on Form 8-K dated Feb. 15, 2005,
                  filed
                  February 22, 2005 and incorporated herein by reference).
                  *3.2
              
              Correction
                  of Articles of Amendment to Articles of Incorporation of EGPI Firecreek
                  Inc., filed with the Nevada Secretary of State on May 12,
                  2005.3.3
              
              Amended
                  By-Laws of Registrant, dated July 1, 2004 (filed as exhibit 2.2
                  to Current
                  Report on Form 8-K dated June 4, 2004, filed July 15, 2004, and
                  incorporated herein by reference).5.1
              
              Consent
                  of Gersten, Savage, LLP (filed as Exhibit 5.1 to Registration Statement
                  on
                  Form SB-2/A filed on September 2, 2005 and incorporated herein
                  by
                  reference).10.1
              
              Securities
                  Purchase Agreement dated May 18, 2005, between the Company and
                  Tirion
                  Group, Inc. (filed as an Exhibit to Current Report on Form 8-K
                  dated May
                  26, 2005 and incorporated herein by reference).10.2
              
              Registration
                  Rights Agreement dated May 18, 2005, between the Company and Tirion
                  Group,
                  Inc. (filed as an Exhibit to Current Report on Form 8-K dated May
                  26, 2005
                  and incorporated by reference).10.3
              
              Intellectual
                  Property Security Agreement dated May 2, 2005, by and between the
                  Company
                  and AJW Partners and its affiliates (filed as an Exhibit on Form
                  10-QSB
                  for the quarter ended March 31, 2005 and incorporated herein by
                  reference).




51




10.4
            
            Guaranty
                and Pledge Agreement dated May 2, 2005, between the Company, Greg
                Fryett,
                CEO of the Company, and AJW Partners and its affiliates (filed as an
                Exhibit to Form 10-QSB for the quarter ended March 31, 2005 and
                incorporated herein by reference).10.5
            
            Security
                Agreement dated May 2, 2005, between the Company and AJW Partners
                and its
                affiliates (filed as an Exhibit to Form 10-QSB for the quarter ended
                March
                31, 2005 and incorporated herein by reference).10.6
            
            Form
                of Callable Secured Convertible Note to AJW Partners LLC, dated May
                2,
                2005 (filed as an Exhibit to Form 10-QSB for the quarter ended March
                31,
                2005 and incorporated herein by reference).10.7
            
            Form
                of Callable Secured Convertible Note to AJW Offshore Limited, dated
                May 2,
                2005 (filed as an Exhibit to Form 10-QSB for the quarter ended March
                31,
                2005 and incorporated herein by reference).10.8
            
            Form
                of Callable Secured Convertible Note to AJW Qualified Partners, LLC,
                dated
                May 2, 2005 (filed as an Exhibit to Form 10-QSB for quarter ended
                March
                31, 2005 and incorporated herein by reference).10.9
            
            Form
                of Callable Secured Convertible Note to New Millenium Capital Partners
                II,
                LLC, dated May 2, 2005, (filed as an Exhibit to Form 10-QSB for quarter
                ended March 31, 2005 and incorporated herein by reference).10.10
            
            Final
                Voting Agreement of EGPI Firecreek (filed as exhibit 99.3 to Current
                Report on Form 8-K dated April 5, 2005, filed April 7, 2005 and
                incorporated herein by reference).10.11
            
            Form
                of Stock Purchase Warrant issued to AJW Partners LLC, effective May
                2,
                2005, Form 10-QSB for the quarter ended March 31, 2005 and incorporated
                herein by reference).10.12
            
            Form
                of Stock Purchase Warrant issued to AJW Offshore Limited, effective
                May 2,
                2005, Form 10-QSB for the quarter ended March 31, 2005 and incorporated
                herein by reference).10.13
            
            Form
                of Stock Purchase Warrant issued to AJW Qualified Partners, LLC,
                effective
                May 2, 2005, Form 10-QSB for the quarter ended March 31, 2005 and
                incorporated herein by reference).10.14
            
            Form
                of Stock Purchase Warrant to New Millenium Capital Partners II, LLC,
                effective May 2, 2005, Form 10-QSB for the quarter ended March 31,
                2005
                and incorporated herein by reference).10.15
            
            Fee
                Protector Agreement, dated June 14, 2005, by and between the Company
                and
                DLM Asset Management, Inc. (filed as an Exhibit to the Current Report
                on
                Form 8-K/A dated June 20, 2005 and incorporated herein by
                reference).10.16
            
            Repurchase
                Agreement dated May 31, 2005, by and between the Company and AJW
                Partners
                (filed as an Exhibit to the Current Report on Form 8-K/A dated June
                2,
                2005 and incorporated herein by reference).10.17
            
            Callable
                Secured Convertible Note, dated May 18, 2005 issued to Tirion Group
                (filed
                as an Exhibit to Current Report on Form 8-K dated May 26, 2005 and
                incorporated herein by reference).10.18
            
            Stock
                Purchase Warrant, dated May 18, 2005 issued to Tirion Group (filed
                as an
                Exhibit to Current Report on Form 8-K dated May 26, 2005 and incorporated
                herein by reference).10.19
            
            Standard
                Office Lease between the Company and Camp Bowie Centre (filed as
                an
                Exhibit to Current Report on Form 8-K dated May 26, 2005 and incorporated
                herein by reference).10.20
            
            Securities
                Purchase Agreement, dated May 2, 2005, between the Company and AJW
                Partners and its affiliates (filed as an Exhibit to Form 10-QSB for
                the
                quarter ended March 31, 2005 and incorporated herein by reference).




52




10.21
            
            Registration
                Rights Agreement, dated May 2, 2005, between the Company and AJW
                Partners
                and Affiliates (filed as an Exhibit to Form 10-QSB for the quarter
                ended
                March 31, 2005 and incorporated herein by reference).10.22
            
            Investment
                Agreement, dated as of June 28, 2005, by and between the Company
                and
                Dutchess Private Equities Fund, II, LP (filed as Exhibit 10.22 to
                Registration Statement on Form SB-2/A filed on September 2, 2005
                and
                incorporated herein by reference).10.23
            
            Registration
                Rights Agreement, dated as of June 28, 2005, by and between the Company
                and Dutchess Private Equities Fund, II, L.P. (filed as Exhibit 10.23
                to
                Registration Statement on Form SB-2/A filed on September 2, 2005
                and
                incorporated herein by reference).10.24
            
            Placement
                Agent Agreement, dated June 28, 2005, by and between the Company,
                U.S.
                Euro Securities and Dutchess Equities Fund II L.P. (filed as Exhibit
                10.24
                to Registration Statement on Form SB-2/A filed on September 2, 2005
                and
                incorporated herein by reference).10.25
            
            Extension
                and Amendment of Corporate Advisory Agreement between the Company
                and
                Steven Antebi; dated June 13, 2005 (Replaces incorrect exhibit previously
                filed.) (filed as Exhibit 10.25 to Registration Statement on Form
                SB-2/A
                filed on September 2, 2005 and incorporated herein by
                reference).10.26
            
            Amendment
                to Investment Agreement, dated August 23, 2005 by and between the
                Company
                and Dutchess Private Equities Fund, II, LP (filed as Exhibit 10.26
                to
                Registration Statement on Form SB-2/A filed on September 2, 2005
                and
                incorporated herein by reference).10.27
            
            Amendment
                to Registration Rights Agreement, dated as of August 23, 2005, by
                and
                between the Company and Dutchess Private Equities Fund, II, L.P.
                (filed as
                Exhibit 10.27 to Registration Statement on Form SB-2/A filed on September
                2, 2005 and incorporated herein by reference).10.28
            
            Extension
                and Amendment of Certain Provisions of Corporate Advisory Agreement
                between the Company and Steven Antebi, dated January 30, 2006 (filed
                as
                Exhibit 10.1 to Current Report on Form 8-K filed February 3, 2006
                and
                incorporated herein by reference).10.29
            
            Warrant
                Certificate containing revised terms of previously issued warrant
                issued
                to Steven Antebi, dated July 12, 2005 (filed as Exhibit 10.4 to Current
                Report on Form 8-K filed on February 3, 2006 and incorporated herein
                by
                reference).10.30
            
            Business
                Relationship Letter Agreement between the Company, Firecreek, and
                The
                Sahara Group furnished with this Report.10.31
            
            Annual
                Report on Form 10-KSB, filed on April 12, 2005, and incorporated
                herein by
                reference.21
            
            Updated
                List of Subsidiaries31.1
            
            Certification
                Pursuant to Section 30232.1
            
            Certification
                Pursuant to Section 906




53


**ITEM
              14.**
            **PRINCIPAL
                ACCOUNTANT FEES AND
                SERVICES**




The
      Audit
      Committee has adopted a policy regarding the retention of the independent
      auditors that requires pre-approval of all services by the Audit Committee
      or
      the Chairman of the Audit Committee. When services are pre-approved by the
      Chairman of the Audit Committee, notice of such approvals is given
      simultaneously to the other members of the Audit Committee, or board of
      directors if Audit Committee is represented by only one member.




The
      Audit
      Committee has reviewed and discussed the fees paid to Donahue Associates for
      the
      reports covering fiscal 2006 and 2005 for audit, audit-related, tax and other
      services.




The
      Audit
      Committee has reviewed and discussed the audited financial statements with
      the
      Company’s management; and discussed with Donahue and Associates, L.L.C.
      independent auditors for the Company, the matters required to be discussed
      by
      Statement on Auditing Standards No. 61, Communication with Audit Committees,
      as
      amended.




The
      aggregate fees billed for the fiscal year ended December 31, 2007 for
      professional services rendered by Donahue and Associates, L.L.C. for the audit
      of the Company’s financial statements were $22,500 paid in first quarter 2008
      for fiscal 2007, and $20,000 was paid first quarter 2007 for fiscal 2006. For
      quarterly review of interim financial statements filed on Form 10-QSB for fiscal
      2007 and 2006, $6,500 and, $$3,600 respectively, was paid.




**Audit-Related
      Fees**




Donahue
      and Associates, L.L.C. did not bill us for any assurance or related services
      that were related to the performance of the audit of the financial
      statements.




**Tax
      Fees**




Since
      December 22, 2003 Donahue Associates has not provided any professional services
      for tax compliance, tax advice and tax planning with the exception of
      consolidated tax returns for 2006 which were $450.00.




Other
      Fees




No
      other
      fees were paid to Donahue Associates, L.L.C.




**PART
                F/S**
            **FINANCIAL
                STATEMENTS**





The
      financial statements of the Company as required by Item 310 of Regulation S-B
      are included in Part II, Item 7 of this report.




54


**SIGNATURES**





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the Registrant has duly caused this report to be signed on April 15,
      2008
      on its behalf by the undersigned, thereunto duly authorized.


**EGPI
                  FIRECREEK, INC.**(Registrant)By:
              /s/
                  Dennis R. AlexanderDennis
                  R. AlexanderChairman,
                  President, CFO, and Director




Pursuant
      to the requirements of the Securities Exchange Act of 1934, 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/
                  Dennis R. Alexander
              
              Chairman,
                  President, and CFO
              
              April
                  15, 2008Dennis
                  R. Alexander
              
              (Chief
                  Financial Officer)/s/
                  Rupert C. Johnson
              
              Director
              
              April
                  15, 2008Rupert
                  C. Johnson/s/
                  Dermot McAtamney
              
              Executive
                  Vice President, Co-Treasurer,
              
              April
                  15, 2008Dermot
                  McAtamney
              
              and
                  Director/s/
                  Dr. Mousa Hawamdah
              
              Director
              
              April
                  15, 2008Dr.
                  Mousa Hawamdah/s/
                  Doug Leighton
              
              Director
              
              April
                  15, 2008Doug
                  Leighton/s/
                  Michael Novielli
              
              Director
              
              April
                  15, 2008Michael
                  Novielli/s/
                  Theodore Smith
              
              Director
              
              April
                  15, 2008Theodore
                  Smith/s/
                  Douglas D’Agata
              
              Director
              
              April
                  15, 2008Douglas
                  D’Agata


55