UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 10-Q(Mark One)þ  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended: October 31, 2008

 ̈TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACTFor the transition period from toCommission file number: 000-49870Big Cat Energy Corporation(Exact name of small business issuer as specified in its charter)

Nevada
     61-1500382(State or other jurisdiction of incorporation or organization)
     (IRS Employer Identification No.)


201 W. Lakeway, Ste. 1000Gillette, WY 82718(Address of principal executive offices)

(307) 685-3122(Issuers telephone number)

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.

Large accelerated filer
     Accelerated filerNon-accelerated filer                                                      þ
     Smaller reporting company


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

State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date: 32,041,000 shares of common stock, $.0001 par value as of December 10, 2008







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BIG CAT ENERGY CORPORATION INDEX

PagePART 1.
     FINANCIAL INFORMATIONITEM 1.
     FINANCIAL STATEMENTSCondensed Balance Sheets as of October 31, 2008(Unaudited) and April 30, 2008
     3Condensed Statements of Operations for the three months ended October 31, 2008and 2007, for the six months ended October 31, 2008 and 2007and for thecumulative period from June 19, 1997 (inception) through October 31, 2008(Unaudited)
     4Condensed Statement of Shareholders Equity for the six months ended October31, 2008 and the cumulative period from inception (June 19, 1997) to October 31,2008 (Unaudited)
     5Condensed Statements of Cash Flows for the three months ended October 31, 2008and 2007, and for the cumulative period from June 19, 1997 (inception) throughOctober 31, 2008(Unaudited)
     7Notes to Unaudited Condensed Financial Statements
     8ITEM 2.
     Managements Discussion and Analysis of Financial Condition and Results ofOperations
     14ITEM 4T. CONTROLS AND PROCEDURES
     19PART II.
     OTHER INFORMATION
     20ITEM 1.
     Legal Proceedings
     20ITEM 2.
     Unregistered Sales of Equity Securities and Use of Proceeds
     20ITEM 3.
     Default Upon Senior Securities
     20ITEM 4.
     Submission of Matters to a Vote of Security Holders
     20ITEM 5.
     Other Information
     20ITEM 6.
     EXHIBITS
     20SIGNATURES
     21










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PART I.

ITEM 1.     FINANCIAL STATEMENTS.

BIG CAT ENERGY CORPORATION(A Development Stage Company)Condensed Balance SheetsOctober 31,
     
     
     April 30, 20082008(Unaudited)AssetsCurrent assets:Cash
     $
     389,417
     
     $
     4,796Certificates of deposit
     
     552,021
     
     
     --Marketable securities
     
     10,019
     
     
     1,065,981Accounts receivable-other
     
     --
     
     
     3,000Inventory
     
     27,662
     
     
     27,662Prepaid expenses and other current assets
     
     37,466
     
     
     23,597Total current assets
     
     1,016,585
     
     
     1,125,036Equipment, net
     
     8,306
     
     
     8,745Other assets
     
     83,544
     
     
     62,141Total Assets
     $
     1,108,435
     
     $
     1,195,922Liabilities and Shareholders EquityCurrent liabilities:Accounts payable and accrued liabilities
     $
     9,461
     
     $
     52,067Shareholders equity:Common stock, $.0001 par value; 100,000,000 shares authorized,32,041,000 and 31,041,000 shares issued and outstandingat October 31, 2008 and April 30, 2008 respectively
     
     3,204
     
     
     3,104Additional paid-in capital
     
     9,679,891
     
     
     8,435,991Deficit accumulated during development stage
     
     (8,584,121)
     
     
     (7,295,240)Total shareholders equity
     
     1,098,974
     
     
     1,143,855Total Liabilities and Shareholders Equity
     $
     1,108,435
     
     $
     1,195,922See accompanying notes to condensed financial statements.






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BIG CAT ENERGY CORPORATION(A Development Stage Company)Condensed Statements of Operations(Unaudited)June 19,1997For the Three Months
     
     
     For the Six Months
     
     
     (Inception)Ended
     
     
     Ended
     
     
     ThroughOctober 31,
     
     
     October 31,
     
     
     October 31,2008
     
     
     2007
     
     
     2008
     
     
     2007
     
     
     2008(Restated)
     
     
     
     
     
     (Restated)Revenues
     $
     20,625
     
     $
     1,875
     
     $
     43,125
     
     $
     1,875
     
     $
     83,125Costs and expenses:Personnel costs (includes stock basedcompensation of $372,000, $460,000,$744,000, $920,000 and $4,944,000respectively)
     
     602,107
     
     
     636,943
     
     
     1,203,573
     
     
     1,270,975
     
     
     6,743,651Professional fees
     
     21,326
     
     
     87,186
     
     
     91,644
     
     
     104,200
     
     
     526,131General and administrative
     
     35,906
     
     
     58,651
     
     
     60,444
     
     
     124,383
     
     
     554,652Total Expenses
     
     659,339
     
     
     782,780
     
     
     1,355,661
     
     
     1,499,558
     
     
     7,824,434LOSS BEFORE OTHER INCOME
     
     (638,714)
     
     
     (780,905)
     
     
     (1,312,536)
     
     
     (1,497,683)
     
     
     (7,741,309)OTHER INCOME (EXPENSE)Interest income
     
     9,991
     
     
     12,263
     
     
     23,655
     
     
     27,323
     
     
     107,369(Loss) on valuation from privateplacement
     
     --
     
     
     --
     
     
     --
     
     
     (433,000)
     
     
     (433,000)Loss before discontinued operations
     
     (628,723)
     
     
     (768,642)
     
     
     (1,288,881)
     
     
     (1,903,360)
     
     
     (8,066,940)Loss on discontinued operations ofSterling Oil & Gas (net of minorityinterest of $4,261, $8,550 and$258,587 respectively)
     
     --
     
     
     (8,623)
     
     
     --
     
     
     (17,868)
     
     
     (517,181)Net (Loss)
     $
     (628,723)
     
     $
     (777,265)
     
     $
     (1,288,881)
     
     $
     (1,921,228)
     
     $
     (8,584,121)Net loss per share from continuingoperations
     $
     (0.02)
     
     $
     (0.03)
     
     $
     (0.04)
     
     $
     (0.06)Net loss per share-discontinuedoperations
     
     --
     
     $
     (0.00)
     
     
     --
     
     $
     (0.00)Net loss per share, basic and dilutive
     $
     (0.02)
     
     $
     (0.03)
     
     $
     (0.04)
     
     $
     (0.06)Weighted average number ofcommon shares outstanding-basicand diluted
     
     32,041,000
     
     
     29,682,304
     
     
     32,035,565
     
     
     29,611,652See accompanying notes to condensed financial statements.




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BIG CAT ENERGY CORPORATION(A Development Stage Company)CONDENSED STATEMENT OF SHAREHOLDERS EQUITYFOR THE SIX MONTHS ENDED OCTOBER 31, 2008AND THE CUMULATIVE PERIOD FROM INCEPTION (JUNE 19, 1997) TO OCTOBER 31, 2008(UNAUDITED)DEFICITINCURREDCOMMONSTOCK
     
     
     ADDITIONAL
     
     
     DURINGPAR VALUE
     
     
     PAID-IN
     
     
     DEVELOPMENTSHARES
     
     
     $.0001
     
     
     CAPITAL
     
     
     STAGE
     
     
     TOTALBalance, at Inception (June 19, 1997)Stock issued for services upon inceptionat June 19, 1997 issued at par
     500,000
     
     $
     50
     
     $
     
     
     $
     
     
     $
     50Common stock cancelled March 2002
     (500,000)
     
     
     (50)
     
     
     
     
     
     
     
     
     (50)Sale of common stock at $0.10 pershare, April 2002
     1,114,000
     
     
     111
     
     
     111,289
     
     
     
     
     
     111,400Contributed services (January 2000through April 2003)
     
     
     
     
     
     
     10,425
     
     
     
     
     
     10,425Cumulative net loss
     
     
     
     
     
     
     
     
     
     (132,543)
     
     
     (132,543)Balance, May 1, 2005
     1,114,000
     
     
     111
     
     
     121,714
     
     
     (132,543)
     
     
     (10,718)Sale of common stock March throughApril 2006 at $0.05 per share
     7,400,000
     
     
     740
     
     
     369,260
     
     
     
     
     
     370,000Sale of common stock at March 2006 at$0.01 per share
     2,500,000
     
     
     250
     
     
     24,750
     
     
     
     
     
     25,000Common stock issued in exchange forassets (Note 6)
     12,450,000
     
     
     1,245
     
     
     22,745
     
     
     
     
     
     23,990Net loss
     
     
     
     
     
     
     
     
     
     (145,182)
     
     
     (145,182)Balance, April 2006
     23,464,000
     
     
     2,346
     
     
     538,469
     
     
     (277,725)
     
     
     263,090Sale of common stock (May throughJune 2006) at $0.50 per share
     4,065,000
     
     
     407
     
     
     2,032,093
     
     
     
     
     
     2,032,500Sale of common stock (January 2007)at $0.75 per share
     2,012,000
     
     
     201
     
     
     1,508,799
     
     
     
     
     
     1,509,000Offering costs
     
     
     
     
     
     
     (21,752)
     
     
     
     
     
     (21,752)Contributed capital
     
     
     
     
     
     
     22,582
     
     
     
     
     
     22,582Stock-based compensation (April 2007)
     
     
     
     
     
     
     1,840,000
     
     
     
     
     
     1,840,000Net loss
     
     
     
     
     
     
     
     
     
     (2,639,221)
     
     
     (2,639,221)Balance, April 30, 2007
     29,541,000
     
     
     2,954
     
     
     5,920,191
     
     
     (2,916,946)
     
     
     3,006,199Sale of common stock (October 2007)at $1.00 per share
     500,000
     
     
     50
     
     
     499,950
     
     
     
     
     
     500,000Sale of units (April 2008) at $0.50 perunit
     1,000,000
     
     
     100
     
     
     499,900
     
     
     
     
     
     500,000Spin off Sterling subsidiary
     
     
     
     
     
     
     (1,794,231)Stock-based compensation (April 2007)
     
     
     
     
     
     
     2,360,000
     
     
     
     
     
     2,360,000Net loss
     
     
     
     
     
     
     
     
     
     (3,428,113)
     
     
     (3,428,113)Balance, April 30, 2008
     31,041,000
     
     
     3,104
     
     
     7,485,810
     
     
     (6,345,059)
     
     
     1,143,855Sale of units (May 2008) at $0.50 perunit
     1,000,000
     
     
     50
     
     
     499,950
     
     
     
     
     
     500,000Stock-based compensation
     
     
     
     
     
     
     744,000
     
     
     
     
     
     744,000


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Net loss six months ended October 312008
     --
     
     
     --
     
     
     --
     
     
     (1,288,881)
     
     
     (1,288,881)Balance October 31, 2008
     32,041,000
     
     $
     3,204
     
     $
     9,679,891
     
     $
     (8,584,121)
     
     $
     1,098,974See accompanying notes to condensed financial statements.








































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BIG CAT ENERGY CORPORATION(A Development Stage Company)Condensed Statements of Cash Flows(Unaudited)June 19, 1997(inception)For the Six Months Ended
     
     
     ThroughOctober 31,
     
     
     October 31,2008
     
     
     2007
     
     
     2008(Restated)Cash Flows From Operating Activities:Net Loss
     $
     (1,288,881)
     
     $
     (1,921,228)
     
     $
     (8,584,121)Adjustments to reconcile net loss to net cash used byoperating activities:Depreciation
     
     1,132
     
     
     980
     
     
     3,694Stock based compensation
     
     744,000
     
     
     920,000
     
     
     4,944,000Contributed services and other
     
     --
     
     
     --
     
     
     10,425Cash flow from discontinued operations
     
     --
     
     
     444,249
     
     
     833,369Changes in operating assets and liabilities:Inventory
     
     --
     
     
     (21,080)
     
     
     (27,662)Accounts receivable
     
     3,000
     
     
     --
     
     
     --Trading securities
     
     503,941
     
     
     97,774
     
     
     (562,040)Prepaid and other
     
     (13,869)
     
     
     (46,001)
     
     
     (37,466)Payables
     
     (42,606)
     
     
     14,801
     
     
     9,461Net cash (used in)operating activities
     
     (93,283)
     
     
     (510,505)
     
     
     (3,410,340)Cash flows from investing activities:Purchase of unproven oil and gas properties
     
     --
     
     
     --
     
     
     (1,794,231)Equipment purchases
     
     (693)
     
     
     --
     
     
     (12,000)Other assets
     
     (21,403)
     
     
     (13,914)
     
     
     (59,555)Cash used in discontinued operations
     
     --
     
     
     (29,723)
     
     
     (133,757)Net cash (used in)investing activities
     
     (22,096)
     
     
     (43,637)
     
     
     (1,999,543)Cash flows from financing activities:Proceeds from related party advances
     
     --
     
     
     --
     
     
     51,618Repayment of related party advances
     
     --
     
     
     --
     
     
     (29,036)Proceeds from the sale of common stock
     
     500,000
     
     
     500,000
     
     
     5,547,901Payments for offering costs
     
     --
     
     
     --
     
     
     (21,752)Cash flow provided by discontinued operations
     
     --
     
     
     249,210
     
     
     250,569Net cash provided byfinancing activities
     
     500,000
     
     
     749,210
     
     
     5,799,300Net Increase in cash andcash equivalents
     
     384,621
     
     
     195,068
     
     
     389,417Cash and cash equivalents:Beginning of period
     
     4,796
     
     
     52,744
     
     
     --End of period
     $
     389,417
     
     $
     247,812
     
     $
     389,417Noncash investing and financing transactions:Forgiveness of debt by related party, accounted for asCapital contributed
     $
     --
     
     $
     --
     
     $
     22,582Stock issued to related party for ARID technology
     $
     --
     
     $
     --
     
     $
     23,990Spin off of Sterling Oil & Gas
     $
     --
     
     $
     --
     
     $
     1,794,231See accompanying notes to condensed financial statements.


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BIG CAT ENERGY CORPORATION(A Development Stage Company)Notes to Condensed Financial Statements(Unaudited)

Note1: Presentation, Organization and Nature of Operations

Presentation

The accompanying unaudited financial statements of Big Cat Energy Corporation (the Company) at October 31, 2008 and 2007 have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial statements pursuant to, instructions to Form 10-Q, and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. These condensed financial statements should be read in conjunction with the financial statements and notes thereto included in the Companys annual report on Form 10-K for the year ended April 30, 2008. In managements opinion, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation to make the Companys financial statements not misleading have been included. The results of operations for the periods ended October 31, 2008 and 2007 presented are not necessarily indicative of the results to be expected for the full year. The April 30, 2008 balance sheet has been derived from the Companys audited financial statements included in the Companys annual report on Form 10-K for the year ended April 30, 2008.

Description of Operations

Big Cat Energy Corporation (Big Cat or the Company), a Nevada corporation, owns the exclusive rights to a technology known as the Aquifer Recharge Injection Device (ARID) which allows Coal Bed Methane (CBM) operators to redistribute water produced from productive coal seams, within the same bore hole. The ARID tool moves contaminated water from the producing coal seam to depleted aquifers of similar water quality, without having to discharge the water on the surface. With the ARID tool and process in use, the production well will not require use of a separate re-injection well for any of the produced water. The produced water never leaves the well bore as it is redirected into different aquifer zones, identified from the geophysical logs.

On May 1, 2007, the Company formed a subsidiary, Sterling Oil & Gas Company (Sterling) and transferred its unevaluated oil and gas properties, consisting of various mineral leases and related costs to Sterling, in return for 10 million shares of Sterling restricted common stock. On April 2, 2008, the Company distributed the Sterling shares in a prorata distribution to Big Cats shareholders. All activity related to Sterling for 2007 has been reported as discontinued operations in the financial statements.

The Company is in the development stage in accordance with Statement of Financial Accounting Standards (SFAS) No. 7. The Company has been in the development stage since inception and has yet to generate any significant revenue-producing operations. Activities since its inception have primarily involved its organization, development of the Company and more recently, its ARID initiative and the spin off of Sterling.

Restated Condensed Statement of Operations-2007

The Loss on discontinued operations of Sterling Oil and Gas in the Condensed Statement of Operations for 2007 has been restated to reflect the non-cash contributed consulting fees from Big Cat to

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the discontinued operations of Sterling Oil and Gas Company, less the respective minority interest. For the three months ended October 31, 2007, the restatement was an increase to net (loss) of $6,833 and for the six months ended October 31, 2007 the restatement was an increase to net (loss) of $13,265.

Note 2: Liquidity

Going Concern

As of October 31, 2008, the Company had working capital of approximately $1,007,124 and stockholders equity of $1,098,974. The Company has realized minimal revenues and has incurred significant losses from operations and used significant cash flow to fund operations for the periods presented in this Quarterly Report. Historically, Big Cat has relied upon outside investor funds to maintain its operations and develop its business. Big Cats plan for continuation anticipates continued funding from investors. This funding would be used for operations, for working capital, as well as business expansion during the upcoming fiscal year. The Company can provide no assurance that additional investor funds will be available on terms acceptable to the Company. These conditions raise substantial doubt about Big Cats ability to continue operations as a going concern.

Big Cats ability to continue as a going concern is dependent upon raising capital through debt or equity financing and ultimately by increasing revenue and achieving profitable operations. The Company can offer no assurance that it will be successful in its efforts to raise additional proceeds or achieve profitable operations. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business.

Note 3: Significant Accounting Policies:

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

Certificates of deposit and Marketable Securities

The Company has purchased unsecured commercial paper (floating rate demand notes) of Ford Motor Credit Company, which is classified as trading securities and fixed rate certificates of deposit from First Interstate Bank. These securities are stated at fair value based on interest rates that approximate market rates and the short term maturity of the notes. The income earned on these investments is included in interest income in the accompanying financial statements.

Concentrations of Credit Risk

The Companys cash equivalents and certificates of deposit are exposed to concentrations of credit risk. The Company manages and controls this risk by investing these funds with major financial institutions.



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Off Balance Sheet Arrangements

From time-to-time, we enter into off-balance sheet arrangements and transactions that can give rise to off-balance sheet obligations. As of October 31, 2008, the off-balance sheet arrangements and transactions that we have entered into include operating lease agreements. The Company does not believe that these arrangements are reasonably likely to materially affect its liquidity or availability of, or requirements for, capital resources.

Income Taxes

The company uses the asset and liability method of accounting for deferred taxes . Deferred tax assets and liabilities are determined based on the temporary differences between the financial statement and the tax basis of the assets and liabilities. Deferred tax assets or liabilities at the end of each period are determined using the tax rate in effect at that time. The Company adopted FASB Interpretation No. 48 (FIN 48),Accounting for Uncertainty in Income Taxes,effective May 1, 2008. FIN 48 requires that amounts recognized in the balance sheet related to uncertain tax positions be classified as current or noncurrent liability, based upon the expected timing of the payment to a taxing authority. The Company had no material uncertain tax positions as of October 31, 2008 or 2007.

Risks and Uncertainties

Historically, oil and gas prices have experienced significant fluctuations and have been particularly volatile in recent years. Price fluctuations can result from variations in weather, levels of regional or national production and demand, availability of transportation capacity to other regions of the country and various other factors. Increases or decreases in oil and gas prices could have a significant impact on future results as drilling activity determines the demand for the Companys technology and ARID tool.

Fair Value of Financial Instruments

The Companys financial instruments consist of cash and cash equivalents, investments, accounts receivable and accounts payable. The fair market value of these financial instruments approximates or is equal to the book value.

In the first quarter of fiscal year 2009, the Company adopted Statement of Financial Accounting Standard (SFAS) No. 157, Fair Value Measurement (SFAS No. 157) as amended by FASB Statement of Position (FSP) FAS 157-1 and FSP FAS 157-2. SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and enhances fair value measurement disclosure. FSP FAS 157-2 delays, until the first quarter of fiscal year 2010, the effective date for SFAS 157 for all non-financial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually).

The following table provides information regarding the source of data used by the Company to develop fair value measurements:

Fair Value Measurements at Reporting Date UsingQuoted Prices in
     
     Significant Other
     SignificantActive Markets for
     
     Observable Inputs
     UnobservableIdentical Assets
     
     
     InputsDescription
     
     October 31, 2008
     
     (Level 1)
     
     (Level 2)
     (Level 3)Certificatesof deposit
     $
     552,021
     $
     550,000
     $
     2,021


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Trading securities
     $
     10,019
     
     $
     10,019
     
     $
     --Total
     $
     562,040
     
     $
     560,019
     
     $
     2,021


Equity-Based Compensation

The Company accounts for equity-based compensation arrangements in accordance with SFAS No. 123R,,Accounting for Stock-Based Compensation, which permits entities to recognize as expense over the vesting period, the fair value of all stock-based awards on the date of grant. The Company recorded expense of stock-based compensation during the three months ended October 31, 2008, totaling $372,000 compared to $460,000 for the three months ended October 31, 2007. The Company has recorded stock-based compensation totaling $744,000 for the six months ended October 31, 2008 compared to $920,000 for the six months ended October 31, 2007.

Net Loss Per Share

Basic net loss per share is computed using the weighted average number of common shares outstanding during the period. Contingently issuable shares are included in the computation of basic net income (loss) per share when the related conditions are satisfied. Diluted net income (loss) per share is computed using the weighted average number of common shares and potentially dilutive securities outstanding during the period. Potentially dilutive securities consist of contingently issuable shares, the incremental common shares issuable upon conversion of preferred stock or convertible debt (using the if converted method) and shares issuable upon the exercise of stock options and warrants (using the treasury stock method). Potentially dilutive securities are excluded from the computation if their effect is anti-dilutive.

As of October 31, 2008 the Company had outstanding 32,041,000 shares of common stock and options to purchase an additional 3,160,000 shares of common stock. At October 31, 2008, there were also warrants for the purchase of 2,000,000 shares of restricted common stock outstanding. At October 31, 2007, the Company had outstanding 30,041,000 shares of common stock and options to purchase an additional 1,550,000 shares of common stock. The options and warrants outstanding were excluded from the calculation of diluted earnings per share as their effect would have been anti dilutive.

Other Comprehensive Income

The Company does not have any other items of other comprehensive income for the six months ended October 31, 2008 and 2007. Therefore, total comprehensive income (loss) is the same as net income (loss) for these periods.

Revenue Recognition

The Company leases its ARID tool and process to its customers. Revenue is recognized equally over the term of lease. When the lease is executed the company records deferred revenue Other Current Liability for those amounts paid for lease commitments for the next 12 months and a Long Term Obligation for those amounts in excess of 12 months. At October 31, 2008, the Company has recorded $6,875 as Other Current Liabilities for deferred revenue and $0 for Long Term Obligations.

Recently Issued Accounting Pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and

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does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

In May 2008, the FASB issued SFAS No. 162,The Hierarchy of Generally Accepted Accounting Principles.This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). We do not anticipate that the adoption of SFAS 162 will materially impact the Company.

In May 2008, the FASB issued SFAS No. 163Accounting for Financial Guarantee Insurance Contractsan interpretation of FASB Statement No. 60.This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements.

This Statement is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years, except for some disclosures about the insurance enterprises risk-management activities. We do not anticipate the adoption of SFAS 163 will have any effect on the Companys future financial position or results of operations.

In September 2008 the FASB issued FSP FAS 133-1 and FIN 45-4Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and Clarification of the Effective Date of FASB Statement No. 161.The credit derivatives market has expanded significantly over the past few years. Financial statement users and others have expressed concerns that the current disclosure requirements for derivative instruments and certain guarantees do not adequately address the potential adverse effects of changes in credit risk on the financial position, financial performance, and cash flows of the sellers of credit derivatives and certain guarantees.This FSP amends FASB Statement No. 133,Accounting for Derivative Instruments and Hedging Activities,to require disclosures by sellers of credit derivatives, including credit derivatives embedded in a hybrid instrument. This FSP also amends FASB Interpretation No. 45,Guarantors Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others,to require an additional disclosure about the current status of the payment/performance risk of a guarantee. Further, this FSP clarifies the Boards intent about the effective date of FASB Statement No. 161,Disclosures about Derivative Instruments and Hedging Activities. We do not anticipate the adoption of this FSP will have a material effect on the Companys future financial position or results of operations.

Note 4: Shareholders EquityPrivate Offerings

During the three months ended October 31, 2007 the Company completed the private placement of 500,000 restricted shares of its common stock to an accredited investor. The company received proceeds

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of $500,000 from the private placement. Following the above sale, the Companys common stock increased to 30,041, 000 shares issued and outstanding.

During April 2008, we completed a private placement of securities and raised gross proceeds of $500,000. We sold a total of 1,000,000 units to six (6) investors, each unit consisting of one (1) share of restricted common stock at $.50 per share and one (1) warrant for one (1) share of restricted common stock at $.75 per share. Following the above sale, the Companys common stock increased to 31,041, 000 shares issued and outstanding.

During the six months ended October 31, 2008 the Company completed the private placement of 1,000,000 units at $.50 per unit, each unit consisting of one restricted share of its common stock and one warrant to purchase one share of restricted common stock exercisable at $.75 per share. The offering began during the fourth quarter of the fiscal year ended April 30, 2008 and was completed during the first quarter of the current fiscal year. As a result of sales during the first quarter, the Company received proceeds of $500,000 from the private placement. Following the above sale, the Companys outstanding common stock increased to 32,041,000 shares.

The Company issued the foregoing shares of common stock as restricted securities pursuant to the exemptions from registration contained in Regulation S of the Securities Act of 1933 and section 4(2) of the Securities Act of 1933. Shares sold pursuant to Regulation S were sold to non U.S. persons outside the United States of America. Shares sold pursuant to section 4(2) of the Securities Act of 1933 were sold to persons who receive the same information that can be found in a Form SB-2 registration statement and were deemed sophisticated investors in that they understood our business and were able to read and understand financial statements.

Note 5: Stock Option Plan

The Company has adopted the 2007 Nonqualified Stock Option Plan (the Plan), as amended, and reserved 5,000,000 shares of common stock for the plan. On April 27, 2007 options to purchase 1,550,000 shares were granted to directors and officers of the Company exercisable at $.50 per share, which was below the fair market value on that date. The 2007 options have a term of five years and have limits on the amounts exercisable over a three-year term. During Fiscal Year 2008, the Company granted options to purchase 1,860,000 shares to directors, officers, and key employees of the Company. Of the 1,860,000 options granted, 255,000 options were granted at $.50 per share, which was below the fair market value on the date of grant. The remaining options were granted at the market price on the date of grant, April 30, 2008. Of the options granted in Fiscal Year 2008, 10,000 are immediately exercisable and the balance becomes exercisable by April 30, 2009. An aggregate of 250,000 options were forfeited during the year ended April 30, 2008.

As of April 30, 2008, and 2007 the options granted under the plan are fully vested, however, the agreement limits the number of options to be exercised each year through April 30, 2009. Due to the limitations on exercising the options, and the fact that they expire if the employee resigns or is terminated for cause, the Company has treated the options as if they vest over a two-year period. The Company expects to recognize approximately $1,500,000 in stock compensation expense ratably through April 30, 2009. There have been no options exercised under the terms of the Plan.

Note 6: Income Tax

The federal net operating loss (NOL) carryforward of approximately $2,800,000 as of October 31, 2008 expires on various dates through 2028. Internal Revenue Code Section 382 places a limitation on

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the amount of taxable income which can be offset by NOL carryforwards incurred before a change in control. Change in control for these purposes generally means greater than a 50% change in ownership of the corporation. After a change in control, a loss corporation cannot deduct NOL carryforwards existing at the time of the change in control in excess of the Section 382 limitations. Due to these change in ownership provisions, utilization of NOL carryforwards may be subject to an annual limitation in future periods. We have not performed a Section 382 analysis, however approximately ninety percent of the present NOL was incurred during the fiscal years beginning April 1, 2007 and thereafter which was consequently after a change in control of the Company in March, 2006.

Nonetheless, we have established a full valuation allowance against the deferred tax assets because, based on the weight of available evidence including our continued operating losses, it is more likely than not that all of the deferred tax assets will not be realized. Because of the full valuation allowance, no income tax expense or benefit is reflected on the statement of operations.

ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements

This Quarterly Report includes certain statements that may be deemed to be forward-looking statements that reflect our current views with respect to future events and financial performance. All statements include in this Quarterly Report, other than statements of historical facts, address matters that we reasonably expect, believe or anticipate will or may occur in the future. Forward-looking statements may relate to, among other things:

| | § | our future financial position, including working capital and anticipated cash flow;                              
| | - | -----------------------------------------------------------------------------------------------------------------
| |  
| | § | the risks of the oil and gas industry, as they relate to demand for leasing the ARID tool;                       
| |  
| | § | market demand;                                                                                                   
| |  
| | § | risks and uncertainties involving geology of oil and gas deposits;                                               
| |  
| | § | the uncertainty of estimates and projections relating to costs and expenses;                                     
| |  
| | § | health, safety and environmental risks;                                                                          
| |  
| | § | uncertainties as to the availability and cost of financing; and                                                  
| |  
| | § | the possibility that government policies or laws may change or governmental approvals may be delayed or withheld.
| |  

Other sections of this Quarterly Report may include additional factors that could adversely affect our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or to the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

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Our forward looking statements contained in this Quarterly Report are made as of the respective dates set forth in this Quarterly Report. Such forward-looking statements are based on the beliefs, expectations and opinions of management as of the date the statements are made. We do not intend to update these forward-looking statements, except as required by law. For the reasons set forth above, investors should not place undue reliance on forward-looking statements.

Plan of Operations

The plan of operations discussed below in this Quarterly Report, reflects the operations of our current business which is to lease or sell the ARID tool and process to oil and gas companies.

We are a development stage company and have realized minimal revenues from our current business operations.

We are in the process of completing field tests of the ARID tool and process, and we are continuing to refine the ARID to improve the field use of the ARID tool and process. Currently, we have six ARID tools operating in CBM (coal bed methane) gas well bores in the Powder River Basin of Wyoming and have leased another 9 to be installed in the fall of 2008.

We are developing another production tool for coal bed methane operations. This new product is a multi-completion tool and process, which upon successful development is expected to allow operators of coal bed methane wells to produce from multiple seams of coal in a single well bore. This multi-completion tool can be used in conjunction with the ARID. We are also developing a smaller ARID tool, 5.5, for use in smaller bore gas wells. The R&D costs associated with these projects are expected to be minimal.

We are evaluating use of the ARID tool in the mining industry. We have received numerous inquiries regarding adapting the ARID for handling water in the mining industry. We are in the initial stages of evaluation of this opportunity.

We have completed our application for the trademark ARID with the United States Patent and Trademark Office. In approximately six months we should receive an examination report from the United States Patent and Trademark Office regarding the trademark application.

Our specific goal for the next twelve months is to establish and complete 3-4 pilot projects in the Powder River Basin of Wyoming, with these pilots generating ARID tool leases in the fall of 2008 and early 2009. We are also evaluating potential pilot projects for Colorado.

During the six months ended October 31, 2008 the Company completed the private placement of 1,000,000 units, at $.50 per unit, each unit consisting of one restricted share of its common stock and one warrant to purchase one share of restricted common stock at $.75 per share. The offering began during the fourth quarter of the fiscal year ended March 31, 2008 and was completed during the first quarter of the current fiscal year. As a result of sales during the first quarter, the Company received proceeds of $500,000 from the private placement. The private offering was made in reliance on an exemption from registration in the United States under Section 4(2) and/or Regulation D of the United States Securities Act of 1933, as amended. The Company relied upon exemptions from registration believed by it to be available under federal and state securities laws in connection with the offering. Following the above sale, the Companys outstanding common stock increased to 32,041,000 shares.

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Results of Operations

Three Months Ended October 31, 2008 Compared to Three Months Ended October 31, 2007

We reported a net loss for the three months ended October 31, 2008 of $628,723 compared with a net loss before discontinued operations of $768,642 and a net loss of $777,265 for the same period in 2007. The net loss for the three months ended October 31, 2008 included $372,000 attributable to non-cash consideration related to the issuance of stock options to management compared to $460,000 for the same period in 2007.

We recorded personnel costs of $602,107 during the three month period ended October 31, 2008, as compared to $636,943 during the same period in 2007. As noted above, we recorded a stock based compensation charge of $372,000 for the three month period ended October 31, 2008, compared with $460,000 for the same period in 2007.

We incurred professional fees of $21,326 during the three month period ended October 31, 2008, as compared to $87,186 during the same period in 2007. Most of the 2007 professional fees related to the cost of required SEC filings.

Our general and administrative costs were $35,906 during the three month period ended October 31, 2008, as compared to $58,651 during the same period in 2007. The major components of other general and administrative costs are insurance and advertising/marketing expenses in both years.

The Company recorded $8,623 for discontinued operations for the three months ended October 31, 2007, relating to the spin off of Sterling Oil & Gas Company. This amount reflects the Sterling loss for the three months ended October 31, 2007 of $12,884, which includes a non cash charge of $10,200 for contributed consulting fees, offset by a minority interest of $4,261.

Six Months Ended October 31, 2008 Compared to Six Months Ended October 31, 2007

We reported a net loss for the six months ended October 31, 2008 of $1,288,881 compared with a net loss before discontinued operations of $1,903,360 and a net loss of $1,921,228 for the same period in 2007. The net loss for the six months ended October 31, 2008 included $744,000 attributable to non-cash consideration related to the issuance of stock options to management compared to $922,000 for the same period in 2007. The 2007 loss before discontinued operations also contained a $433,000 non cash charge for the valuation loss on the Sterling Oil & Gas subsidiary, which was spun off in April 2008.

We recorded personnel costs of $1,203,573 during the six month period ended October 31, 2008, as compared to $1,270,975 during the same period in 2006. We recorded a stock based compensation charge of $744,000 for the six month period ended October 31, 2008, compared to $920,000 for the same period in 2007.

We incurred professional fees of $91,644 during the six month period ended October 31, 2008 as compared to $104,200 during the same period 2007. Most of the professional fees related to the cost of required SEC filings.

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Our general and administrative costs were $60,449 during the six month period ended October 31, 2008, as compared to $124,383 during the same period in
2007. The major components of other general and administrative expense are insurance and marketing/advertising costs.

The Company recorded $17,868 for discontinued operations for the six months ended October 31, 2007, relating to the spin off of Sterling Oil & Gas
Company. This amount reflects the Sterling loss for the six months ended October 31, 2007 of $26,418, which includes a non cash charge of $19,800 for contributed consulting fees, offset by a minority interest of $8,550.

Liquidity and Capital Resources

As of October 31, 2008, we had working capital of approximately $1,007,124, and it is uncertain whether this amount will be sufficient to fund operations
for the next year. Therefore, we may seek additional sources of capital for the coming year.

Cash used in operations was $93,283 for the six months ended October 31, 2008, and compared to cash used in operations of $510,505 for the six months
ended October 31, 2007. In the six month period ended October 31, 2008 cash provided by operations was principally attributed to our net loss offset by cash provided by trading securities and our non-cash compensation expense of $744,000.
For the six months ended October 31, 2007 cash used in operations was principally from our net loss and activities in trading securities offset by non-cash compensation expense of $920,000 and the effect of discontinued operations of
$444,249.

Cash flows used in investing activities were $22,096 for the six months ended October 31, 2008, and $43,637 for the three months ended July 31, 2007.
Both amounts are nominal.

Cash flows from financing activities were $500,000 for the six months ended October 31, 2008, and $749,210 for the six months ended October 31, 2007.
For the six months ended October 31, 2008, cash from financing was principally from the private placement of our stock and for the six months ended October 31, 2007 cash from financing was from a private placement and from the discontinued
operations of Sterling.

During the six months ended October 31, 2008 the Company completed the private placement of 1,000,000 units, each unit consisting of one restricted share of its
common stock at $.50 per share and one warrant to purchase one share of restricted common stock at $.75 per share. The offering began during the fourth quarter of the fiscal year ended March 31, 2008 and was completed during the first
quarter of the current fiscal year. As a result of sales during the first quarter, the Company received proceeds of $500,000 from the private placement. The private offering was made in reliance on an exemption from registration in the United
States under Section 4(2) and/or Regulation D of the United States Securities Act of 1933, as amended. The Company relied upon exemptions from registration believed by it to be available under federal and state securities laws in connection with the
offering. Following the above sale, the Companys outstanding common stock increased to 32,041,000 shares.

During the six months ended October 31, 2007 the Company completed the private placement of 500,000 restricted shares of its common stock to an accredited
investor. The company received proceeds of $500,000 from the private placement. The private offering was made in reliance on an exemption from registration for a sale in the United States under Section 4(2) and/or Regulation D of the United
States Securities Act of 1933, as amended. The Company relied upon exemptions from registration believed by it to be available under federal and state securities laws in connection with the offering. Following the above sale, the Companys
common stock increased to 30,041,000 shares issued and outstanding.

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Financial Instruments and Other Information

As of October 31, 2008 and October 31, 2007 we had cash, marketable securities, accounts payable and accrued liabilities, which are each carried at approximate fair value due to the short maturity date of those instruments. Unless otherwise noted, it is managements opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.

Critical Accounting Polices and Estimates

Use of Estimates in the Preparation of Financial Statements

The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of any oil and gas reserves, assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on various assumptions it believes to be reasonable under the circumstances. Although actual results may differ from these estimates under different assumptions or conditions, the Company believes that its estimates are reasonable.

Equity Based Compensation

On January 1, 2006, we adopted FASB SFAS No. 123 (revised 2004), Share-Based Payment (SFAS 123(R), which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors including employee stock options based on estimated fair value. SFAS 123(R) supersedes our previous accounting under Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees.  In March 2005, the SEC issued Staff Accounting Bulletin No. 107 (SAB 107) relating to SFAS 123(R). We have applied the provisions of SAB 107 in our adoption of SFAS 123(R).

SFAS 123(R) requires companies to estimate the fair value of share-based payment awards on the date of the grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in our statement of operations. Prior to the adoption of SFAS 123(R), we had no stock-based compensation awarded to employees and directors.

Recently Issued Accounting Pronouncements:

In May 2008, the FASB issued SFAS No. 162,The Hierarchy of Generally Accepted Accounting Principles.This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). We are currently evaluating the impact of adopting SFAS 160 on our results of operations and financial condition.

In May 2008, the FASB issued SFAS No. 163Accounting for Financial Guarantee Insurance Contractsan interpretation of FASB Statement No. 60.This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence

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that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements.

This Statement is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years, except for some disclosures about the insurance enterprises risk-management activities. We do not anticipate the adoption of SFAS 163 will have any effect on the Companys future financial position or results of operations.

In September 2008 the FASB issued FSP FAS 133-1 and FIN 45-4Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and Clarification of the Effective Date of FASB Statement No. 161.The credit derivatives market has expanded significantly over the past few years. Financial statement users and others have expressed concerns that the current disclosure requirements for derivative instruments and certain guarantees do not adequately address the potential adverse effects of changes in credit risk on the financial position, financial performance, and cash flows of the sellers of credit derivatives and certain guarantees.

This FSP amends FASB Statement No. 133,Accounting for Derivative Instruments and Hedging Activities,to require disclosures by sellers of credit derivatives, including credit derivatives embedded in a hybrid instrument. This FSP also amends FASB Interpretation No. 45,Guarantors Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others,to require an additional disclosure about the current status of the payment/performance risk of a guarantee. Further, this FSP clarifies the Boards intent about the effective date of FASB Statement No. 161,Disclosures about Derivative Instruments and Hedging Activities. We do not anticipate the adoption of this FSP will have a material effect on the Companys future financial position or results of operations.

Off-Balance Sheet Arrangements

From time-to-time, we may enter into off-balance sheet arrangements and transactions that can give rise to off-balance sheet obligations. As of October 31, 2008 and October 31, 2007, there were no off balance sheet arrangements.



ITEM 4T. CONTROLS AND PROCEDURES

The Companys Chief Executive Officer and the Principal Financial Officer evaluated the effectiveness of the Companys disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) as of October 31, 2008. Based on this evaluation, the Chief Executive Officer and Principal Financial Officer concluded that, as of October 31, the Companys disclosure controls and procedures were effective.

There were no changes in the Companys internal controls over financial reporting that occurred during the quarter ended October 31, 2008, that have materially affected, or are reasonably likely to materially affect, the Companys internal controls over financial reporting, except that as to the Companys previous determination that it had a material weakness in its internal control over financial

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reporting in that it does not have a sufficient complement of personnel with appropriate training and experience to evaluate highly complex and/or unusual transactions under generally accepted accounting principles and Securities and Exchange Commissions accounting interpretations, management has determined to retain and rely upon outside experts in accounting in the event of such transactions.

PART II. OTHER INFORMATION

ITEM 1. Legal ProceedingsNone

ITEM 2. Unregistered Sales of Equity Securities and Use of ProceedsNone

ITEM 3. Default Upon Senior SecuritiesNone

ITEM 4. Submission of Matters to a Vote of Security HoldersNone

ITEM 5. Other InformationNone

ITEM 6. EXHIBITS.

Exhibits
     Document Description31.1
     Section 302 Certification of Principal Executive Officer.31.2
     Section 302 Certification of Principal Financial Officer.32.1
     Section 906 Certification of Chief Executive Officer.32.2
     Section 906 Certification of Chief Financial Officer.


























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SIGNATURES

In accordance with Section 13 or 15(d) of the Securities and Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on this 9th day of December, 2008.

BIG CAT ENERGY CORPORATIONBY:  TIMOTHY BARRITTTimothy Barritt, President and PrincipalExecutive OfficerBY:  RICHARD G. STIFELRichard G. Stifel, Principal Accounting Officerand Principal Financial Officer































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