FILED PURSUANT TO RULE 424(B)(3)
REGISTRATION NO. 333-144321
PROSPECTUS SUPPLEMENT NO. 2
(TO PROSPECTUS DATED JULY 13, 2007)
15,312,500
SHARES
EMPIRE PETROLEUM CORPORATION
COMMON STOCK
----------------------
This prospectus supplement No. 2 supplements and amends the prospectus
dated July 13, 2007, as supplemented and amended by that certain prospectus
supplement No. 1 dated August 9, 2007 (the "Prospectus"). This prospectus
supplement should be read in conjunction with the Prospectus, which is to be
delivered with this prospectus supplement.
This prospectus supplement includes the attached Quarterly Report on
Form 10-QSB (the "Form 10-QSB") of Empire Petroleum Corporation (the "Company"),
for the three months ended September 30, 2007, filed by the Company with the
Securities and Exchange Commission on November 14, 2007. The exhibits to the
Form 10-QSB are not included with this prospectus supplement and are not
incorporated by reference herein.
THERE ARE SIGNIFICANT RISKS ASSOCIATED WITH AN INVESTMENT IN OUR
SECURITIES. THESE RISKS ARE DESCRIBED UNDER THE CAPTION "RISK FACTORS" BEGINNING
ON PAGE 3 OF THE PROSPECTUS, AS THE SAME MAY BE UPDATED IN PROSPECTUS
SUPPLEMENTS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus supplement is December 3, 2007.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] Quarterly Report Under Section 13 OR 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 2007
[ ] Transition Report Under Section 13 or 15(d) of the Exchange Act
For the transition period from _______________to________________
Commission file number 001-16653
EMPIRE PETROLEUM CORPORATION
(Exact name of small business issuer as specified in its charter)
DELAWARE 73-1238709
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8801 S. Yale, Suite 120, Tulsa, Oklahoma 74137-3575
(Address of principal executive offices)
(918) 488-8068
(Issuer's telephone number)
(Former name, former address and former fiscal year, if changed since last
report)
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.
[X] Yes [ ] No
Indicate by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act).
[ ] Yes [X] No
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
Common Stock, $.001 Par Value 55,080,190 shares outstanding as of
September 30, 2007.
Transitional Small Business Disclosure Format: [ ] Yes [X] No
EMPIRE PETROLEUM CORPORATION
INDEX TO FORM 10-QSB
Part I. FINANCIAL INFORMATION Page
Item 1. Financial Statements
Balance Sheet at September 30, 2007 (Unaudited) 1
Statements of Operations for the three months and the nine
months ended September 30, 2007 and 2006 (Unaudited) 2
Statements of Cash Flows for the nine months ended
September 30, 2007 and 2006 (Unaudited) 3
Notes to Financial Statements 4-7
Item 2. Management's Discussion and Analysis 7-10
Item 3. Controls and Procedures 10
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 11
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
EMPIRE PETROLEUM CORPORATION
BALANCE SHEET
September 30,
2007
ASSETS (Unaudited)
___________
Current assets:
Cash $ 469,614
Accounts receivable (net of allowance of $3,750) 51,702
___________
Total current assets 521,316
Property & equipment, net of accumulated
depreciation and depletion 1,017,102
___________
Total Assets $ 1,538,418
___________
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued
liabilities $ 52,301
Accounts payable to related party 274,682
___________
Total current liabilities 326,983
Long term liabilities:
Asset retirement obligation 52,200
___________
Total liabilities 379,183
___________
Stockholders' equity:
Common stock - $.001 par value, authorized
100,000,000 shares, issued 55,080,190 shares 55,080
Additional paid in capital 11,519,676
Accumulated deficit (10,415,521)
___________
Total stockholders' equity 1,159,235
___________
Total liabilities and stockholders' equity $ 1,538,418
___________
See accompanying notes to financial statements.
-1-
EMPIRE PETROLEUM CORPORATION
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
____________________________ ________________________
2007 2006 2007 2006
_____________ _____________ ____________ __________
Revenue:
Petroleum sales $ 0 $ 6,575 $ 5,255 $ 29,476
_____________ _____________ ____________ __________
0 6,575 5,255 29,476
_____________ _____________ ____________ __________
Costs and expenses:
Production & operating 21,024 31,403 67,849 127,524
General & administrative 70,388 86,757 193,497 214,728
Well abandonment expense 38,984 0 1,158,680 0
____________ _____________ ____________ __________
130,396 118,160 1,420,025 342,252
____________ _____________ ____________ __________
Operating income (loss) (130,396) (111,585) (1,418,221) (312,776)
____________ _____________ ____________ __________
Other (income) and expense:
Miscellaneous income (99,606) 0 ( 99,606) ( 43)
Interest income 0 0 ( 71) ( 148)
Interest expense 0 1,725 3,450 5,175
____________ _____________ ____________ __________
Total other (income)
expense (99,606) 1,725 ( 96,227) 4,984
____________ _____________ ____________ _________
Net loss $ (30,790) $ (113,310) $ (1,318,543) $ (317,760)
____________ _____________ ____________ __________
Net loss
per common share $ .00 $ .00 $ .02 $ .00
____________ _____________ ____________ __________
Weighted average number of
common shares
outstanding 55,080,190 47,420,849 53,241,955 44,366,036
____________ _____________ ____________ __________
See accompanying notes to financial statements.
-2-
EMPIRE PETROLEUM CORPORATION
STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Ended
September 30, September 30,
2007 2006
_________ _________
Cash flows from operating activities:
Net loss $(1,318,543) $(317,760)
Adjustments to reconcile net loss
to net cash used in operating activities:
Value of services contributed by employees 37,500 37,500
Well abandonment costs 1,158,680 0
Stock option plan expense 0 26,925
Gain on settlement of note obligation ( 96,121) 0
(Increase) decrease in assets:
Accounts receivable 38,443 (420,043)
Increase (decrease) in liabilities:
Accounts payable and accrued expenses ( 59,221) 77,585
________ ________
Net cash used in operating activities ( 239,262) (595,793)
________ ________
Cash flows from financing activities:
Proceeds from private equity placement 1,000,000 1,450,000
Settlement of note ( 10,000) 0
________ _________
Net cash provided by financing activities 990,000 1,450,000
________ _________
Cash flows from investing activities:
Lease interest acquisition-Gabbs Valley 0 (675,000)
Well drilling and testing costs (341,910) (392,034)
________ __________
Net cash used by investing activities (341,910) (1,067,034)
________ ________
Net increase (decrease) in cash 408,828 (212,827)
Cash - Beginning 60,786 369,292
________ ________
Cash -Ending $469,614 $156,465
________ ________
See accompanying notes to financial statements.
-3-
EMPIRE PETROLEUM CORPORATION
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2007
(UNAUDITED)
1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES:
The accompanying unaudited financial statements of Empire Petroleum
Corporation (Empire, or the Company) have been prepared in accordance
with United States generally accepted accounting principles for interim
financial information and the instructions to Form 10-QSB. Accordingly,
they do not include all of the information and footnotes required by
United States generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
considered necessary for a fair presentation of the Company's financial
position, the results of operations, and the cash flows for the interim
period are included. Operating results for the interim period are not
necessarily indicative of the results that may be expected for the year
ending December 31, 2007.
The information contained in this Form 10-QSB should be read in
conjunction with the audited financial statements and related notes for
the year ended December 31, 2006 which are contained in the Company's
Annual Report on Form 10-KSB filed with the Securities and Exchange
Commission (the SEC) on April 3, 2007.
The Company has been incurring significant losses in recent years.
The continuation of the Company as a going concern is dependent upon the
ability of the Company to attain future profitable operations. These
financial statements have been prepared on the basis of United States
generally accepted accounting principles applicable to a company with
continuing operations, which assume that the Company will continue in
operation for the foreseeable future and will be able to realize its assets
and discharge its obligations in the normal course of operations. Management
believes the going concern assumption to be appropriate for these financial
statements. If the going concern assumption were not appropriate for these
financial statements, then adjustments might be necessary to adjust the
carrying value of assets and liabilities and reported expenses.
The Company continues to explore and develop its oil and gas interests.
The ultimate recoverability of the Company's investment in its oil and gas
interests is dependent upon the existence and discovery of economically
recoverable oil and gas reserves, confirmation of the Company's interest in
the oil and gas interests, the ability of the Company to obtain necessary
financing to further develop the interests, and upon the ability to attain
future profitable production.
In 2003, the Company engaged a partner to explore its Cheyenne River Prospect,
and signed an agreement to acquire a 10% interest in a block of acreage in the
Gabbs Valley Prospect of western Nevada. In June 2005, the Company completed
a private placement of 5,000,000 shares of its common stock along with
warrants to purchase 1,250,000 shares of its common stock for an aggregate
purchase price of $500,000. Subject to certain restrictions, the warrants may
be exercised until May 15, 2008 (extended from the previous date of August
-4-
2007) at an exercise price of $0.25 per share. Proceeds of the private
placement were allocated $67,875 to common stock warrants and $432,125 to
common stock and paid-in capital. These funds were used for general corporate
purposes and to pay the Company's share of the costs associated with its then
10% interest in the Gabbs Valley Oil Prospect in Nevada. By subsequent
agreement with Cortez Exploration, LLC (formerly O. F. Duffield) dated May 8,
2006, Empire acquired an additional 30% interest by agreeing to pay $675,000 in
land and related costs to Cortez and 45% of the drilling and completion costs
on a test well to be known as the Empire Cobble Cuesta 1-12-12-34E, Nye County,
Nevada. When combined with the original 10% working interest in the well and
lease block which was expanded to 75,806 gross acres by the acquisition of an
additional 30,917 acres from the U. S. Department of the Interior on June 14,
2006, the Company's working interest increased to 40%, after paying 55% of the
drilling and completion costs of the Empire Cobble Cuesta 1-12-12N-34E test
well. To fund this increased interest, the Company initiated a private
placement of common stock along with warrants to purchase common stock in June
2006. In connection with this private placement, the Company issued 7,250,000
shares of common stock and warrants to purchase 1,812,500 shares of its common
stock for an aggregate purchase price of $1,450,000. In April, 2007 the
Company raised $1,000,000 through a private placement of 5,000,000 shares of
its common stock along with warrants to purchase 1,250,000 shares of its
common stock (See Note 4). On August 2, 2007, Empire acquired a further 17%
interest which increased its interest in the Gabbs Valley Prospect and leases
to 57% (See Note 3). The Company is planning to drill another well in the
Gabbs Valley Prospect. To fund this well the Company is talking to potential
industry partner(s) about drilling a well deep enough to penetrate 1,000 feet
into the Triassic formation or 8,000 feet, whichever first occurs. As of
September 30, 2007, the Company had $469,614 of cash on hand. In order to
sustain the Company's operations on a long term basis, the Company intends to
continue to look for merger opportunities and consider public or private
financings. The Company anticipates that it has the funds necessary to
continue its operations through the next twelve months.
Compensation of Officers and Employees
The Company's only executive officer serves without pay or other compensation.
The fair value of these services is estimated by management and is recognized
as a capital contribution. For the nine months ended September 30, 2007, the
Company recorded $37,500 as a capital contribution by its executive officer.
2. NOTES PAYABLE:
In December 2001, the Company executed a note with Weatherford
U.S., L.P. to satisfy an outstanding indebtedness for service in
the drilling of the Timber Draw #1-AH well. The principal amount
of this note was $108,334 with interest payments at 10% per annum
commencing on May 27, 2001, until all interest and principal amounts
are paid in full. Timely payments were made in accordance with
the terms of this note through March 2002. In April 2002, the "payee"
of this note agreed to a revised payment schedule extending final payment
of $66,997 from April 10, 2002, until June 10, 2002. In connection
with this payment schedule, the Company only made the initial payment of
$10,000. At June 30, 2007, the Company had accrued a liability of $109,571
in connection with this note.
In July, 2007 the Company and Weatherford settled the liability for a payment
of $10,000 by the Company. The Company recorded the difference between the
settlement amount and its previously recorded liability in the amount of
$99,571 as other income in the period ending September 30, 2007.
-5-
3. PROPERTY AND EQUIPMENT:
The Company owns a working interest in approximately 27,900 acres of oil and
gas leases located in Niobrara County, Wyoming (the "Cheyenne River Prospect")
and an overriding royalty interest of between 1.5% and 2% in 40,758 acres of
oil and gas leases located in or near the Cheyenne River Prospect. On March
31, 2004, a third party paid approximately $52,128 of the Company's lease
rentals on 32,643 acres in the Cheyenne River Prospect in exchange for an
option to drill a test well in order to earn an interest in the farmout block,
which option was subject to the third party first completing a seismic survey
covering 16 square miles in the Cheyenne River Prospect. This survey was
completed in September of 2003. The processing and interpreting of the data
from such survey was completed September 30, 2003, and earned the third party
a 25% interest in the Timber Draw #1-AH well and prospect acreage. This third
party commenced a test well in the NW/4NE/4 Section 15, Twp 39N, Rge 66W,
Niobrara County, Wyoming, known as the Empire Hooligan Draw Unit #1-AH, on
August 6, 2004. The well was drilled horizontally to a measured drilling
depth of 9,332 feet. As a result of this earning well being drilled the
Company's working interest in the Hooligan Draw #1-AH well and prospect
acreage was reduced to 26.785% and to 17.5% of the Timber Draw #1-AH well.
As a result of the reduction in the Company's working interest as described
above, the Company recorded an impairment charge of $188,507 in 2005.
The Company and the other interest owners of the Cheyenne River Prospect
have agreed in principle with a third party whereby the third party agrees
to drill three test wells, at no cost to the existing interest owners, on
the Company's leases for a working interest in the three drilling units
subject to an override and a 50% working interest in the balance of the
leases. The third party would also take over operations on the two oil wells
with the option to acquire a 50% working interest. This agreement is subject
to formal agreements currently being prepared.
On May 8, 2003, the Company entered into an agreement with O.F. Duffield
(now Cortez Exploration, LLC)(Duffield Agreement) to acquire a ten percent
(10%) working interest in a block of acreage in the Gabbs Valley Prospect by
agreeing to issue 2,000,000 shares of the Company's Common Stock to Mr.
Duffield for such 10% interest. The shares were issued in July 2003. This
block of acreage in the Gabbs Valley Prospect consists of federal leases
covering 44,604 acres in Nye and Mineral Counties, Nevada in which Mr.
Duffield had a 100% working interest. The shares were valued at $.10 per
share based on the closing price of the Company's common stock on the date of
issuance.
During September 2005, surveyors laid out a 19.5 mile seismic program on the
Gabbs Valley Prospect, and a seismic survey was commenced in October 2005.
Field work was carried out and final interpretation of the data was completed
in November 2005. Based on the results of the seismic survey, the Company
increased its working interest in the prospect to 40% (See Note 1) and
contracted a drilling rig which commenced drilling the Empire Cobble Cuesta
1-12-12N-34E, Nye County, Nevada on September 14, 2006. Drilling operations
were suspended October 23, 2006 in order to give the Company time to evaluate
the drilling results. The total gross acres in this prospect was increased to
75,806 acres by the acquisition of 30,917 acres from the U. S. Department of
the Interior on June 14, 2006.
Coastal Energy Company Nevada (CECN)(formerly PetroWorld Nevada Corp.) was a
participant in the Gabbs Valley Prospect with a seismic option under which it
elected to drill a well and earn a 30% interest from Cortez Exploration, Inc.
The Company's Chief Executive Officer is a member of the Board of Directors of
-6-
both CECN and its parent company Coastal Energy Company (formerly PetroWorld
Corporation) and owns approximately 1.63% of the parent Company which is
traded on the AIM Exchange in London and the Toronto Venture Exchange
in Toronto. The Coastal interest was acquired on August 2, 2007 by Empire
(17%) and Cortez (13%), resulting in Empire's interest being increased to
57%. To acquire the interest, Empire and Cortez agreed to pay Coastal's
share of the remaining costs related to abandonment of the Cobble Cuesta test
well. Empire's share of these costs are estimated to be approximately
$34,200.
On May 1, 2007 the Company announced it had re-entered and completed testing
on the Empire Cobble Cuesta 1-12-12N-34E, Nye County, Nevada well. As no
hydrocarbons were recovered, the Company has taken steps to partially plug and
abandon the well. The Company and its consultants have analyzed the data
obtained from the Cobble Cuesta 1-12 and have concluded another well should be
drilled on this prospect. The Company is pursuing one or more industry
partners to drill the next test well, the timing of which could be determined
by the BLM's posting for sale certain unleased lands situated on the Gabbs
Valley Structure. For the nine months ended September 30, 2007, based on the
results of testing the well, the Company expensed $1,158,680 of equipment and
intangible drilling costs which had been incurred to drill the test well,
including $38,984 incurred in the three months ended September 30, 2007.
4. EQUITY
In April, 2007 the Company completed a private placement of 5,000,000 shares
of its common stock along with warrants to acquire up to 1,250,000 shares of
its common stock for an aggregate purchase price of $1,000,000. The warrants
have an exercise price of $.50 per share and, subject to certain restrictions,
may be exercised until May 15, 2008. Proceeds of the placement were allocated
$80,000 to common stock warrants, and $920,000 to common stock and paid in
capital. Approximately $337,000 of the funds were used to pay for the
Company's costs associated with the re-entry and testing of the Cobble Cuesta
1-12 well in the Gabbs Valley Prospect in Nevada and the remaining funds have
been or will be used for general corporate purposes.
On September 21, 2007 the Company extended all of its outstanding warrants to
May 15, 2008.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
GENERAL TO ALL PERIODS
The Company's primary business is the exploration and development of oil and
gas interests. The Company has incurred significant losses from operations,
and there is no assurance that it will achieve profitability or obtain funds
necessary to finance its operations. Sales revenue for all periods presented
is attributable to the production of oil from the Company's Timber Draw #1-AH
and the Hooligan Draw #1-AH wells located in the Eastern Powder River Basin
in the State of Wyoming, otherwise known as the Cheyenne River Prospect.
For all periods presented, the Company's effective tax rate is 0%. The
Company has generated net operating losses since inception, which would
normally reflect a tax benefit in the statement of operations and a deferred
asset on the balance sheet. However, because of the current uncertainty as
to the Company's ability to achieve profitability, a valuation reserve has
been established that offsets the amount of any tax benefit available
for each period presented in the statements of operations.
-7-
THREE MONTH PERIOD ENDED SEPTEMBER 30, 2007, COMPARED TO THREE MONTH PERIOD
ENDED SEPTEMBER 30, 2006.
For the three months ended September 30, 2007, sales revenue decreased $6,575
to $0 compared to $6,575 for the same period during 2006. The decrease
in sales revenue was the result of no production from the Timber Draw #1-AH
and the Hooligan Draw #1-AH wells.
Well abandonment expenses increased to $38,984 for the three months
ended September 30, 2007 from $0 in 2006. The increase is due to the
determination to partially plug and abandon the Cobble Cuesta test well in
Nevada.
Production and operating expenses decreased $10,379 to $21,024 for the
three months ended September 30, 2007, from $31,403 for the same period in
2006. The decrease was primarily due to no drilling activity in the current
period.
General and administrative expenses decreased by $16,369 to $70,388 for the
three months ended September 30, 2007, from $86,757 for the same period in
2006. The decrease was primarily due to our partners paying their share of
the lease rentals.
Miscellaneous income increased $99,606 for the three months ended September
30, 2007 from the same period in 2006. The increase was attributable to the
settlement of the Weatherford Note.
NINE MONTH PERIOD ENDED SEPTEMBER 30, 2007, COMPARED TO NINE MONTH PERIOD
ENDED SEPTEMBER 30, 2006.
For the nine months ended September 30, 2007, sales revenue decreased $24,221
to $5,255, compared to $29,476 for the same period during 2006. The decrease
in sales revenue was the result of lower production from the Timber Draw #1-AH
and the Hooligan Draw #1-AH wells.
Well abandonment expenses increased to $1,158,680 for the nine months
ended September 30, 2007 from $0 in 2006. The increase is due to the
determination to partially plug and abandon the Cobble Cuesta test well in
Nevada.
Production and operating expenses decreased $59,675 to $67,849 for the
nine months ended September 30, 2007, from $127,524 for the same period in
2006. The decrease was primarily due to no drilling activity in the current
period.
General and administrative expenses decreased by $21,231 to $193,497 for the
nine months ended September 30, 2007, from $214,728 for the same period in
2006. The decrease was primarily due to lower professional fees in the
first quarter of 2007.
Miscellaneous income increased $99,563 to $99,606 for the nine months ended
September 30, 2007, from $43 for the same period in 2006. The increase was
attributable to the settlement of the Weatherford Note.
For the nine months ended September 30, 2007, interest expense decreased
$1,725 to $3,450, compared to $5,175 for the same period in 2006. The
decrease was due to settlement of the Weatherford note.
LIQUIDITY AND CAPITAL RESOURCES
-8-
GENERAL
As of September 30, 2007, the Company had $469,614 of cash on hand. In April,
2007 the Company raised $1,000,000 through a private placement of common
stock along with warrants to purchase common stock. The Company believes
that its cash on hand will allow it to finance its operations for the next
twelve months, and to participate in further exploration of the Gabbs Valley
Prospect. In order to sustain the Company's operations on a long term basis,
the Company intends to continue to look for merger opportunities and consider
public or private financings. The Company anticipates that it has the funds
necessary to continue its operations through the next twelve months. The
Company does not plan to undertake further exploration of the Gabbs Valley
or Cheyenne River Prospects without an industry partner or additional equity
placement.
OUTLOOK
The Company and the other interest owners of the Cheyenne River Prospect
have agreed in principle with a third party whereby the third party agrees
to drill three test wells, at no cost to the existing interest owners, on
the Company's leases for a working interest in the three drilling units
subject to an override and a 50% working interest in the balance of the
leases. The third party would also take over operations on the two oil
wells with the option to acquire a 50% working interest. This agreement
is subject to formal agreements currently being prepared.
As stated elsewhere in this Form 10-QSB, on May 1, 2007, after further
testing of the Company's only well in the Gabbs Valley Prospect, the
Company decided to partially plug and abandon the well since no hydrocarbons
were recovered. However, the Company was encouraged by the data it acquired
in connection with the drilling, logging and testing of the well and
additional studies of such data, with the assistance of geological and
engineering consultants, determined that further drilling is warranted.
It is possible that excessive mud exposure in the hole for over five months
seriously impeded the process of recovering hydrocarbons. It was
determined that a new test well should be drilled using a different
method of drilling. The Company plans to engage an industry partner to
drill the next test well and this effort is underway.
ADVANCES FROM RELATED PARTY
Through March 31, 2005, the Company financed its operations primarily through
advances made to the Company by the Albert E. Whitehead Living Trust, of which
the Company's Chairman of the Board and Chief Executive Officer, Mr. Whitehead,
is the trustee. At September 30, 2007 the Company is indebted to the Albert E.
Whitehead Living Trust in the amount of $274,682.
MATERIAL RISKS
The Company has incurred significant losses from operations and there is no
assurance that it will achieve profitability or obtain funds necessary to
finance continued operations. For other material risks, see the Company's
form 10-KSB for the period ended December 31, 2006, which was filed April 3,
2007.
FORWARD-LOOKING INFORMATION
This quarterly report on Form 10-QSB, including this section, includes certain
statements that may be deemed "forward-looking statements" within the meaning
-9-
of federal securities laws. All statements, other than statements of
historical facts, that address activities, events or developments that the
Company expects, believes or anticipates will or may occur in the future,
including future sources of financing and other possible business
developments, are forward-looking statements. Such statements are subject
to a number of assumptions, risks and uncertainties and could be affected by
a number of different factors, including the Company's failure to secure short
and long term financing necessary to sustain and grow its operations, increased
competition, changes in the markets in which the Company participates and the
technology utilized by the Company and new legislation regarding environmental
matters. These risks and other risks that could affect the Company's business
are more fully described in reports it files with the Securities and Exchange
Commission, including its Form 10-KSB for the fiscal year ended December 31,
2006. Actual results may vary materially from the forward-looking statements.
The Company undertakes no duty to update any of the forward-looking statements
in this Form 10-QSB.
Item 3. CONTROLS AND PROCEDURES
As of the end of the period covered by this report, the Company carried out an
evaluation under the supervision of the Company's Chief Executive Officer (and
principal financial officer) of the effectiveness of the design and operation
of the Company's disclosure controls and procedures pursuant to Securities
Exchange Act Rules 13a- 15(e) and 15d-15(e). Based on this evaluation, the
Company's Chief Executive Officer (and principal financial officer) has
concluded that the disclosure controls and procedures as of the end of the
period covered by this report are effective. During the period covered by this
report, there was no change in the Company's internal controls over financial
reporting that has materially affected or that is reasonably likely to
materially affect the Company's internal control over financial reporting.
PART II. OTHER INFORMATION
Item 6. Exhibits
a) Exhibits
31 Certification of Chief Executive Officer (and principal
financial officer) pursuant to Rules 13a-14(a) and 15d-14(a)
promulgated under the Securities Exchange Act of 1934, as
amended, and Item 601(b)(31) of Regulation S-B, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
(submitted herewith).
32 Certification of Chief Executive Officer (and principal
financial officer) pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 (submitted herewith).
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EMPIRE PETROLEUM CORPORATION
SIGNATURES
In accordance with the requirements of the Exchange Act, the small
business issuer caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
EMPIRE PETROLEUM CORPORATION
Date: November 14, 2007 By: /s/ Albert E. Whitehead
___________________
Albert E. Whitehead
Chairman/CEO