ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This report includes certain forward-looking statements. Forward-looking statements are statements that predict the occurrence of future events and are not based on historical fact. Forward-looking statements may be identified by the use of forward-looking terminology, such as “may”, “shall”, “will”, “could”, “expect”, “estimate”, “anticipate”, “predict”, “probable”, “possible”, “should”, “continue”, or similar terms, variations of those terms or the negative of those terms. We have written the forward-looking statements specified in the following information on the basis of assumptions we consider to be reasonable. However, we cannot predict our future operating results. Any representation, guarantee, or warranty should not be inferred from those forward-looking statements.

The assumptions we used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty in economic, legislative, industry, and other circumstances. As a result, judgment must be exercised in the identification and interpretation of data and other information and in their use in developing and selecting assumptions from and among reasonable alternatives. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results. Accordingly we express no opinion on the achievability of those forward-looking statements. We cannot guarantee that any of the assumptions relating to the forward-looking statements specified in the following information are accurate. We assume no obligation to update any such forward-looking statements.

Overview

Prior to May 2005, we were known as Peloton Resources Inc., a mining exploration company. Peloton was actively searching for ore bodies containing gold in British Columbia. A consultant was hired to assess the economic viability of exploring for and developing gold reserves on Peloton’s properties. Based upon his report, Peloton decided to abandon all mining activities and to commence shifting towards an oil and gas exploration company. In connection with the shift in operational focus, we changed our name to Triangle Petroleum Corporation.

The changeover from a mining to an oil and gas exploration company has taken place over the past two years, during one of the strongest markets for oil and natural gas. The average monthly price for West Texas Intermediate (WTI) crude oil and natural gas (Henry Hub Nymex), currently, as compared to the past, is as follows:

Although these strong commodity prices have resulted in extremely competitive conditions for the supply of products and services for exploration companies, our outlook remains positive. Despite these strong fundamentals, it should be noted that significant short term fluctuations in North American natural gas prices have occurred based upon seasonal weather patterns and gas storage levels. It should also be noted that actual prices received for oil and gas are typically less than the WTI and Henry Hub prices, respectively. This discount varies from time to time and is based on location, quality and other factors.

Plan of Operations

Since our inception, we have had the opportunity to screen various projects in a variety of geographic locations with numerous potential joint venture partners. The project areas outlined below were carefully selected based on our belief in balancing overall project risk against potential project returns and the anticipated time horizons required to achieve such returns. The three core project areas (Canadian Shale, Fayetteville Shale and Rocky Mountain Conventional Programs) represent distinctive exploration opportunities. In conjunction with our joint venture partners, we intend to execute our operating plan in order to realize the full value of the initial land base that has been established. The remaining two project areas (Barnett Shale and Western Canadian Programs) are currently designated as non-core due to existing market conditions related to land acquisition costs, drilling costs and completion costs.

Eastern Canada - Canadian Shale Gas Program

Over the last 21 months, a multi-disciplined geoscience team has screened prospective basins in Eastern Canada. The screening process includes an assessment of the geologic history for a given area, estimates of pressure and temperature profiles and a determination of the ability to fracture stimulate a prospective shale package. As a direct result of implementing this strategy, we have executed two farm-in agreements with a Canadian company to pursue two shale gas opportunities in Eastern Canada.

The first project covers approximately 68,000 gross acres in the Moncton sub-basin of New Brunswick, Canada. We are entitled to earn a 70% working interest in the block subsequent to the acquisition and evaluation of a seismic program and then electing to drill a test well no later than December 31, 2008. We believe this acreage to be located in a favorable geological setting based on technical work performed to date and drilling activity in the area. Additional laboratory measurements will be taken on core samples and drill cuttings, which are available from previously drilled conventional wells, to select our first drilling location.

The second agreement covers approximately 516,000 gross acres in the Windsor Area of Nova Scotia, Canada. We are entitled to earn a 70% working interest in the block subsequent to drilling and completing a test well no later than September 15, 2008. Based on an extensive screening process and technical work performed to date, this area is also believed to be located in a highly favorable geological setting. Our current Windsor Basin exploration program is estimated to cost approximately $11 million. Laboratory measurements were taken on core samples and drill cuttings which are available from previously drilled conventional wells and two drilling locations were selected. The following is a summary of the two wells drilled in the Company's Windsor Basin land block.

The first well, Kennetcook #1, reached a total depth of 4,390 feet and was rig released on September 15, 2007 after running casing to total depth. Kennetcook #1 is located 25 miles west of the community of Truro, Nova Scotia. This well was extensively cored over an interval of 1,150 feet. Based upon the preliminary log analysis and lab work, the primary zone of interest is approximately 350 feet thick and the secondary zone of interest is approximately 260 feet thick. Advanced well log data was acquired on this well and the data was integrated with the special core measurements performed by service companies with extensive unconventional shale gas expertise.

The second well, Kennetcook #2, reached a total depth of 6,350 feet and was rig released on October 13, 2007 after running casing to total depth. Kennetcook #2 is located approximately two miles north-west of Kennetcook #1 and was cored over an interval of 430 feet. Similar logging programs to Kennetcook #1 were performed and the integration with shale gas laboratory measurements was performed. Based upon preliminary log analysis, the primary shale zone in Kennetcook # 2 is approximately 500 feet thick.

We have concluded that a comprehensive hydraulic fracture stimulation program is warranted to assess the Horton Bluff deliverability. As such, a stimulation program design moved forward in October based on favorable laboratory measurements of rock properties, gas content and fluid compatibility. The design required two frac water holding ponds to be constructed, each with the capacity to hold up to 2.5 million gallons of fluid, and the Kennetcook #1 well to be completed first with the results of this operation used to guide the completion planning for Kennetcook #2.

A large, slick water fracture stimulation program was performed in two stages on each well during the later part of November and early December 2007. The Kennetcook #1 first stage frac used 850,000 gallons of slick water with 560,000 pounds of sand proppant volumes, and the second stage frac used 660,000 gallons of water and 386,000 pounds of sand. The Kennetcook #2 first stage frac used 641,000 gallons of slick water with 176,000 pounds of sand, and the second stage frac used 653,000 gallons of water 366,000 pounds of sand. Stimulations of this magnitude are in line with the current stimulations in the Barnett Shale of the Fort Worth Basin and the Fayetteville Shale of the Arkoma Basin.

An aggressive seismic program was acquired during October 2007: the 25 square mile 3-D program covers our initial target area over the Kennetcook wells and the 30 mile 2-D program extends to another favorable area of the land block. Shot hole drilling for both the 3-D and the 2-D programs has been completed and all the data was recorded. The processing phase of the seismic program was finished in early December. Interpretation of this data is expected to occur over the next 60-90 days. The first priority of the interpreted 3-D seismic program will be to select future well locations.

The development of on-shore gas production in Nova Scotia is in a very early phase. We are currently in discussions with various marketing groups to communicate our aggressive exploration program initiatives that are in progress for the Windsor Basin of Nova Scotia. The gas currently marketed into the northeastern U.S. markets is being sold at a premium to other North American producing areas.

Arkoma Basin Arkansas - Fayetteville Shale Program

We have entered into a new joint venture agreement with our operating partner, Kerogen Resources, Inc. ("Kerogen") of Houston, Texas in October 2007. The expanded joint-venture will build on the 20,000 net acres (34,000 gross acres) currently held in Conway, Pope and Faulkner Counties, Arkansas where both companies now hold an equal 50% working interest. The new joint venture includes a 52 township Area of Mutual Interest ("AMI") in Conway, Faulkner, Pope and Van Buren Counties, which covers a significant portion of the core producing areas of the Fayetteville. The term of this agreement is for three years during which time both companies expect to initiate an aggressive drilling program.

Under the terms of this new joint venture agreement, we are obligated to drill and complete one new net horizontal well. We will pay 67% of the capped capital costs to earn a 50% interest. All future operations under the joint venture will be shared on an equal basis. The noted drilling commitment is a replacement for a previous drilling commitment on the acreage originally acquired by both companies. We reimbursed Kerogen for actual land costs which totaled $458,000.

Currently, one vertical test Fayetteville well has been drilled in Conway County, on a location covered by a recently acquired 12 square mile proprietary 3-D seismic survey. An adjacent second 12 square mile proprietary 3-D seismic survey has been shot and is currently being processed and merged with the first survey. Kerogen, the operator, advises that completion of this vertical test well remains a high priority. This completion will be beneficial for providing key reservoir parameters needed to assist both Kerogen and us in horizontal drilling programs in the AMI.

States of Colorado, Montana and Wyoming - Rocky Mountain Program

We have embarked on a joint venture with Hunter Energy LLC of Denver, Colorado. We made an initial commitment to participate in the drilling of three projects. We have a 25% working interest in the three Hunter Energy projects. The project areas are geographically located in northwestern Colorado, southwestern Wyoming, and northern Montana. The gross acreage position in the three areas is approximately 77,000 acres. We have advanced approximately $3.8 million dollars in land, prospect fees and drilling costs relating to this project.

Although the initial test well in Colorado was not successful, plans for this project include working with area operators to continue the exploration program. We commenced a oil exploration program in southwestern Wyoming in September 2007. We pay 33% of the costs for a 25% working interest. We drilled a 2,000 foot test well into the Nugget Sandstone formation. We were targeting a conventional oil reservoir on this 17,000 gross acre prospect in Lincoln County, Wyoming. Based on the data collected to date, the well will not be commercially viable. Drilling on the Montana project is anticipated to commence in early to mid 2008 with consideration being given to service industry equipment availability and prevailing short-term winter weather conditions. It is anticipated that our share of costs to drill these two wells will be approximately $1.9 million.

Greater Fort Worth Basin Texas - Barnett Shale Program (non-core project)

We participated in a five-county joint venture program with Kerogen where we earned working interests ranging between 6% and 27%. Approximately 12,400 gross acres have been leased. As of October 31, 2007, we have expended approximately $2.5 million in prospect fees, land costs and, geological and geophysical expenditures. In July 2007, we sold our working interest position (27%) of approximately of 12,100 gross acres of undeveloped acreage and received proceeds of $984,000. Our investment in this land position was approximately $1.9 million. The remaining unsold acreage contains our four producing wells which we participated in at a lower working interest (approximately 6%). The four wells are currently producing at various rates. The operator of these wells has commenced voluntary bankruptcy proceedings. As a result, we have not received our monthly production revenue since January 2007; however the amounts owing to us have been set aside by the bankruptcy trustee in a separate bank account. In addition, we continue to receive monthly statements detailing our share of production revenue and related production royalties and operating expenses. We spent approximately $1.2 million drilling and completing these four wells.

In late 2006, we participated in four Barnett Shale gas wells with another joint venture at working interests ranging between 11% and 15%. We have commenced production from two of the first four horizontal wells (Hood County) and the other two wells (Parker County) have been drilled and were completed and placed on production in late November 2007. We have spent approximately $1.6 million on these four wells to date.

Alberta Canada Deep Basin - Western Canadian Program (non-core project)

We originally licensed a 120 square mile seismic data set, at a cost of approximately $1.3 million, to assist in the generation of the most prospective drilling sites. To date, we have participated in drilling and/or completing eight Deep Basin wells at a total cost of approximately $7.0 million net to us. These eight wells were drilled as part of four different joint ventures with varying working interests.

We have commenced production from two of eight wells. The first well located in the Kakwa Area has been tested at an initial rate of 3.6 mmcfpd or 600 BOED (barrels of oil equivalent per day) and it is expected to produce at 2.2 mmcfd starting in the fourth quarter of calendar 2007. We paid 20% of the well costs for an 18% interest before payout (and 12% after payout). The second well is located in the Wapiti Area and we have an approximate 35% working interest in this well. Subsequent to completion, the well was connected to a nearby pipeline and initial production rates ranged from 0.4 to 0.6 mmcfpd or 60 to 100 BOED. The third well was also drilled in the Wapiti Area and we have a 50% interest in this well that was testing the Cadomin and Falher zones. The Cadomin zone was completed but tested wet and the Falher zone tested gas but at rates that were uneconomic to tie-in this past winter season.

Of the remaining six wells drilled by us, one of the wells tested fresh water, with no natural gas present. Two other wells tested gas but at rates that that were uneconomic to warrant a pipeline tie-in based on today’s natural gas pricing environment. The final three wells were taken over by a new operator during mid 2006 and we are waiting for the new operator to propose a potential completion strategy for these wells.

Results of Operations for the three and nine months ended October 31, 2007 compared to the three and nine months ended October 31, 2006

Daily Sales Volumes, Working Interest before royalties

		Three Months Ended October 31,				Nine Months Ended October 31,
		2007		2006		2007		2006
Barnett Shale in Texas, USA	Mcfpd		333		60		193		20
Deep Basin in Alberta, Canada	Mcfpd		247		-		127		-
Total Company	Mcfpd		580		60		320		20
Total Company	Boepd		97		10		53		3

Net Operating Results

		Three Months Ended October 31,				Nine Months Ended October 31,
		2007		2006		2007		2006
Volumes	Mcf		53,516		5,481		87,492		5,481
Price	$/Mcf		5.77		4.48		6.28		4.47
Revenue		$	308,613	$	24,540	$	549,554	$	24,540
Royalties			116,981		-		164,695		-
Revenue, net of royalties			191,632		24,540		384,859		24,540
Production expenses			146,396		-		220,199		-
Net		$	45,236	$	24,540	$	164,660	$	24,540

For the three and nine month periods ended October 31, 2007, we realized $308,613 and $549,554, respectively, in revenue from sales of natural gas and natural gas liquids, as compared to $24,540 for the comparable periods in 2006. This revenue was the result of production from six small working interest wells located in the Barnett Shale in Texas that came on production in the three months ended October 31, 2006 and two wells located in the Deep Basin of Alberta that came on production in the three months ended July 31, 2007. Royalties related to this revenue totaled $116,981 and $164,695 (38% and 30% of revenue) for the three and nine month periods ended October 31, 2007, respectively, as compared to $nil for the comparable periods in 2006. Production expenses related to this revenue totaled $146,396 and $220,199 ($16.42/Boe and $15.11/Boe) for the three and nine month periods ended October 31, 2007, respectively, as compared to $nil for the comparable periods in 2006.

Depletion, Depreciation and Accretion (“DD&A”)

	Three Months Ended October 31,				Nine Months Ended October 31,
	2007		2006		2007		2006
DD&A – oil and gas properties	$	151,327	$	7,590	$	391,884	$	19,828
Depreciation – property and equipment		9,178		24,375		30,792		24,375
Total	$	160,505	$	31,965	$	422,676	$	44,203
Total per BOE	$	18.00	$	34.99	$	28.99	$	48.39

Due to the startup of production in the three months ended October 31, 2006, depletion on the proven oil and gas properties was calculated and expensed at $34.99/BOE in the three months ended October 31, 2006 compared to $18.00 for the comparable period of 2007. The decrease in the depletion rate was due to a $2,946,000 non-cash “ceiling test” impairment loss that was booked against proved properties under “full cost” accounting method in the three months ended July 31, 2007, as discussed next.

Unproven property costs of $25,567,059 were excluded from costs subject to depletion in the current three and nine month periods.

Impairment costs

	Three Months Ended October 31,				Nine Months Ended October 31,
	2007		2006		2007		2006
Unproven property cost impairment:
Alberta Deep Basin	$	4,604,726	$	1,041,852	$	4,604,726	$	1,086,789
Texas Barnett shale		-		-		945,403		-
Proved property cost impairment
Alberta Deep Basin		-		-		1,208,000		-
Texas Barnett shale		-		-		1,738,000		-
Total	$	4,604,726	$	1,041,852	$	8,496,129	$	1,086,789

We recognized unproven property cost impairments of $4,604,726 in the three months ended October 31, 2007 and $1,041,852 in the three months ended October 31, 2006 related mainly to seismic purchase and drilling costs in the Alberta Deep Basin that management now considers a non-core asset. Also in the current year, we recognized an unproven property cost impairment loss of $945,403 related to land and geological and geophysical costs of $1,929,305 spent on 12,100 gross acres (27% working interest) in northeast Hill County of Texas that was sold for gross proceeds of $983,902 on July 18, 2007.

In the current year, we recognized proved property impairments (“ceiling test” write-down) of $1,208,000 and $1,738,000 related to the Alberta Deep Basin and Barnett Shale projects, respectively, that management now considers non-core assets. These were mainly the result of low gas prices, higher costs to drill and complete the wells than anticipated and lower production and reserves than forecasted. .

General and Administrative (“G&A”)

	Three Months Ended October 31,				Nine Months Ended October 31,
	2007		2006		2007		2006
Salaries, wages and consulting fees	$	412,276	$	375,105	$	1,035,518	$	802,191
Other travel and office expense		392,296		151,331		1,149,942		797,480
Stock-based compensation		913,335		1,108,336		3,066,979		4,670,481
G&A	$	1,717,907	$	1,634,772	$	5,252,439	$	6,270,152

General and administrative expenses have decreased significantly in the nine months ended October 31, 2007 compared to the same period of 2006 primarily due to decreased stock-based compensation expense mainly as a result of shares issued to our executives that have now been fully recognized.

Convertible debentures

Carrying value of convertible debentures:

	October 31, 2007						January 31, 2007
Issuance Date	Face Value		Discount		Carrying Value		Face Value		Discount		Carrying Value
June 14, 2005	$	-	$	-	$	-	$	2,750,000	$	515,626	$	2,234,374
December 8, 2005		9,750,000		2,790, 644		6,959,366		13,250,000		6,095,191		7,154,808
December 28, 2005		10,000,000		3,890,297		6,109,703		10,000,000		6,383,450		3,616,550
Total convertible debentures	$	19,750,000	$	6,680,931	$	13,069,069	$	26,000,000	$	12,994,268	$	13,005,732

Accretion of discounts on convertible debentures:

	Three Months Ended October 31,				Nine Months Ended October 31,
Issuance Date	2007		2006		2007		2006
June 14, 2005	$	-	$	837,500	$	515,626	$	2,506,250
December 8, 2005		864,619		1,088,646		3,304,559		2,464,558
December 28, 2005		840,183		840,183		2,493,151		2,493,151
Total accretion of discounts	$	1,704,802	$	2,766,329	$	6,313,336	$	7,463,959

Accretion of discounts on convertible debentures deceased in the three and nine months periods ended October 31, 2007 compared to the comparable periods of 2006 due primarily to the June 14, 2005 debenture discounts being fully converted as at June 2007.

Interest expense:

	Three Months Ended October 31,				Nine Months Ended October 31,
Issuance Date	2007		2006		2007		2006
June 14, 2005	$	-	$	73,556	$	18,918	$	251,486
December 8, 2005		128,629		185,650		426,542		474,690
December 28, 2005		189,041		189,042		560,959		560,960
Total interest expense	$	317,670	$	448,248	$	1,006,419	$	1,287,136

Interest expense deceased in the three and nine months periods ended October 31, 2007 compared to the comparable periods of 2006 due primarily to the June 14, 2005 convertible debentures being fully converted as at June 2007.

Oil and gas property expenditures

	Three Months Ended October 31,			Nine Months Ended October 31,
	2007			2007
Alberta		106,807		$	1,263,946
Arkansas		1,260,572			6,728,589
East Coast (Nova Scotia and New Brunswick)		7,282,495			7,364,209
Rocky Mountains (Colorado, Montana, Wyoming)		313,477			398,275
Texas		(670,404	)		732,717
Total oil and gas expenditures	$	8,292,947		$	16,487,736

During the three months ended October 31, 2007, we spent $1,260,572 on the Fayetteville project in Arkansas mainly for land brokerage fees ($0.5 million) and seismic acquisition ($0.6 million) and $7,282,495 on the Nova Scotia shale gas project in the East Coast mainly for Kennetcook #1 and #2 drilling ($3.9 million), preliminary Kennetcook #1 and #2 completions ($0.5 million) plus 2D and 3D seismic acquisition ($2.8 million).

Liquidity and Capital Resources

As at October 31, 2007, we had a working capital deficit of $5,152,430 resulting primarily from the non-cash derivative liability of $7,709,289, accrued interest of $2,474,348 and payables of $6,224,484 offset by our cash and cash equivalents of $9,343,940. For the nine months ended October 31, 2007, we had net cash outflow from operating activities of $3,187,993. Cash used in investing activities totaled $12,575,055 for the nine months ended October 31, 2007, which was used to fund our share of costs relating to the first two wells drilled in Nova Scotia, acquiring 2D and 3-D seismic in Nova Scotia, the first vertical well drilled in Fayetteville Shale Project in the Arkoma Basin, acquiring additional land and 3-D seismic in Fayetteville Shale Project, as well as the remaining capital commitments for the three Deep Basin gas wells drilled in Alberta during the winter of the prior year. Cash provided by financing activities totaled $19,308,006 for the nine months ended October 31, 2007. On February 26, 2007, we sold an aggregate of 10,412,000 shares of our common stock at $2.00 per share to 24 accredited investors in a private placement transaction for aggregate proceeds of $20,824,000. Subsequent to October 31, 2007, we received proceeds of $6,000,000 related to the exercise of all share purchase warrants issued in connection with our June 14, 2005 private placement which resulted in the issuance of 6,000,000 shares of common stock.

We expect significant capital expenditures during the next 12 months for seismic data acquisitions, land and drilling rights acquisitions, drilling programs, overhead and working capital purposes. We believe we have sufficient funds to conduct our operations for the balance of fiscal 2008. If additional financing is required, there can be no assurance that it will be available in amounts or on terms acceptable to us, if at all.

By adjusting our operations to the level of capitalization, we believe we have sufficient capital resources to meet projected cash flow deficits in the near term. However, if during that period, or thereafter, we are not successful in generating sufficient liquidity from operations or in raising sufficient capital resources, on terms acceptable to us, this could have a material adverse effect on our business, results of operations, liquidity and financial condition.

We presently do not have any available credit, bank financing or other external sources of liquidity. Due to our brief history and historical operating losses, our operations have not been a source of liquidity. We will need to obtain additional capital in order to expand operations and become profitable. In order to obtain capital, we may need to sell additional shares of our common stock or borrow funds from private lenders. There can be no assurance that we will be successful in obtaining additional funding.

We will still need additional investments in order to continue operations until we are able to achieve positive operating cash flow. Additional investments are being sought, but we cannot guarantee that we will be able to obtain such investments. Financing transactions may include the issuance of equity or debt securities, obtaining credit facilities, or other financing mechanisms. However, the trading price of our common stock and a downturn in the U.S. stock and debt markets could make it more difficult to obtain financing through the issuance of equity or debt securities. Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect significant amounts owed to us, or experience unexpected cash requirements that would force us to seek alternative financing. Furthermore, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. If additional financing is not available or is not available on acceptable terms, we will have to curtail our operations.

To date, we have generated minimal revenues and have incurred operating losses in every quarter. Our registered independent auditors have stated in their report dated April 2, 2007, that we are an early exploration company, have not generated significant revenues from operations and have incurred significant losses since inception. These factors among others raise substantial doubt about our ability to continue as a going concern.

December 8, 2005 Secured Convertible Debenture Financing

To obtain funding for our ongoing operations, we entered into a Securities Purchase Agreement with YA Global Investments, L.P. (formerly, Cornell Capital Partners, L.P.), an accredited investor, on December 8, 2005 for the sale of $15,000,000 in secured convertible debentures. They provided us with an aggregate of $15,000,000 as follows:

$5,000,000 was disbursed on December 8, 2005;

$5,000,000 was disbursed on January 17, 2006; and

$5,000,000 was disbursed on June 1, 2006.

The secured convertible debentures bear interest at 5%, mature three years from the date of issuance, and are convertible into our common stock, at the selling stockholders' option, at the lower of (i) $5.00 or (ii) 90% of the average of the three lowest daily volume weighted average prices of our common stock, as quoted by Bloomberg, LP, of the 10 trading days immediately preceding the date of conversion. Accordingly, there is in fact no limit on the number of shares into which the secured convertible debentures may be converted. As of December 6, 2007, the average of the three lowest intraday trading prices for our common stock during the preceding 10 trading days as quoted by Bloomberg, LP was $1.37 and, therefore, the conversion price for the secured convertible notes was $1.233. Based on this conversion price, the $6,100,140 in secured convertible debentures remaining outstanding, excluding interest, were convertible into 4,947,397 shares of our common stock. The sale of such a large number of shares of common stock could significantly deflate the market price of our common stock, which would have the further effect of requiring us to issue additional shares upon conversion of the secured convertible debentures. Depending on our stock price, the conversion of the secured convertible debentures could lead to the sale of potentially controlling amounts of shares of common stock. As of December 6, 2007, $8,899,860 of the debenture had been converted into 6,000,000 shares of common stock and $6,100,140 remained outstanding. As of October 31, 2007, $9,750,000 (January 31, 2007 - $13,250,000) of the issued debentures were outstanding and $5,250,000 (January 31, 2007 - $1,750,000) had been converted. Since the conversion feature had a fair value of $10,151,918 at the time the convertible debentures were issued, we recognized a discount of $10,151,918 against the convertible debenture liability and recorded an equivalent amount to derivative liabilities on the balance sheet. The carrying value of the convertible debentures liability on the balance sheet as at October 31, 2007 has been accreted to $6,969,366 (January 31, 2007 - $7,154,808). As of October 31, 2007, the conversion features were marked to market with a fair value of $4,926,489 (January 31, 2007 - $5,541,457), which was recorded as a non-cash derivative liability on the balance sheet under current liabilities.

The investor has contractually agreed to restrict its ability to convert the debentures and receive shares of our common stock such that the number of shares of common stock held by it and its affiliates after such conversion does not exceed 4.9% of the then issued and outstanding shares of common stock. In addition, the investor is restricted from converting more than $1,500,000 in principle amount of the debenture in any thirty day period, with no more than $1,000,000 of such amount at the variable market conversion price.

We have the right, at our option, with three business days advance written notice, to redeem a portion or all amounts outstanding under the secured convertible debentures prior to the maturity date provided that the closing bid price of our common stock, is less than $5.00 at the time of the redemption. In the event of a redemption, we are obligated to pay an amount equal to the principal amount being redeemed plus a 20% redemption premium, and accrued interest.

In connection with the Securities Purchase Agreement dated December 8, 2005, we granted the investor registration rights. We were obligated to use our best efforts to cause the registration statement to be declared effective no later than June 30, 2006 and to insure that the registration statement remains in effect until all of the shares of common stock issuable upon conversion of the secured convertible debentures have been sold. In the event of a default of our obligations under the Registration Rights Agreement, including if the registration statement is not declared effective by June 30, 2006, we are required pay to YA Global Investments, as liquidated damages, for each month that the registration statement has not been filed or declared effective, as the case may be, either a cash amount or shares of our common stock equal to 2% of the liquidated value of the secured convertible debentures. The registration statement was declared effective on May 25, 2006.

In connection with the Securities Purchase Agreement dated December 8, 2005, we and each of our subsidiaries executed security agreements in favor of the investor granting them a first priority security interest in all of our goods, inventory, contractual rights and general intangibles, receivables, documents, instruments, chattel paper, and intellectual property. The security agreements state that if an event of default occurs under the secured convertible debentures or security agreements, the investors have the right to take possession of the collateral, to operate our business using the collateral, and have the right to assign, sell, lease or otherwise dispose of and deliver all or any part of the collateral, at public or private sale or otherwise to satisfy our obligations under these agreements.

December 28, 2005 Convertible Debenture and Warrants Financing

To obtain funding for our ongoing operations, we entered into Securities Purchase Agreements with two accredited investors on December 28, 2005 for the sale of (i) $10,000,000 in convertible debentures and (ii) warrants to purchase 1,250,000 shares of our common stock. The two accredited investors, Bank Sal. Oppenheim Jr. & Cie., (Schweiz) AG and Centrum Bank each subscribed for 50% of the total offering.

The investors provided us with an aggregate of $10,000,000 as follows:

$5,000,000 was disbursed on December 28, 2005; and

$5,000,000 was disbursed on January 23, 2006.

Pursuant to the Securities Purchase Agreements, we issued to each investor 625,000 warrants to purchase shares of common stock on December 28, 2005 and January 23, 2006 exercisable at a price of $5.00 per share. Accordingly, we issued a total of 1,250,000 warrants. As of January 31, 2007, all of the warrants had expired.

The convertible debentures bear interest at 7.5%, mature three years from the date of issuance, and are convertible into our common stock, at the selling stockholders' option, at a rate of $4.00 per share. The investors have contractually agreed to restrict their ability to convert its debentures or exercise its warrants and receive shares of our common stock such that the number of shares of common stock held by it and its affiliates after such conversion or exercise does not exceed 4.99% of the then issued and outstanding shares of common stock. As of October 31 and December 6, 2007, all $10,000,000 of the issued debentures were outstanding and none had been converted. Due to the embedded beneficial conversion feature and detachable warrants issued, we recognized a discount of $10,000,000 against the convertible debenture liability on the balance sheet, with $6,738,750 being recorded to additional paid in capital and $3,261,250 being recorded to derivative liabilities. The carrying value of the convertible debentures liability on the balance sheet as at October 31, 2007 has been accreted to $6,109, 703 (January 31, 2007 - $3,616,550).

In connection with the Securities Purchase Agreement dated December 28, 2005, we granted the investors registration rights. Pursuant to the registration rights agreement, if we did not have the registration statement declared effective on or before May 27, 2006, we were obligated to pay liquidated damages in the amount of 1.0% for each 30-day period or pro rata for any portion thereof following the date by which such registration statement should have been filed for which no registration statement is filed or should have been declared effective. The registration statement was declared effective on May 25, 2006.

February 26, 2007 Private Placement

On February 26, 2007, we sold an aggregate of 10,412,000 shares of our common stock at $2.00 per share to 24 accredited investors in a private placement transaction for aggregate proceeds of $20,824,000. Pursuant to the terms of sale, we agreed to cause a resale registration statement covering the common stock to be filed no later than 30 days after the closing and declared effective no later than 120 days after the closing. If we fail to comply with the registration statement filing or effective date requirements, we will be required to pay the investors a fee equal to 1% of the aggregate amount invested by the purchasers per each 30 day period of delay, not to exceed 10%. We paid the placement agents of the offering a cash fee of 6.5% of the proceeds of the offering. The registration statement was declared effective on March 14, 2007.

Critical Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. We regularly evaluate estimates and assumptions related to useful life and recoverability of long-lived assets, asset retirement obligations, stock-based compensation and deferred income tax asset valuation allowances. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Investment in Oil and Gas Properties

We utilize the full cost method to account for our investment in oil and gas properties. Accordingly, all costs associated with acquisition and exploration of oil and gas reserves, including such costs as leasehold acquisition costs, interest costs relating to unproved properties, geological expenditures and direct internal costs are capitalized into the full cost pool. As of October 31, 2007, we had two countries with proven reserves. For our proven oil and gas reserves, capitalized costs, including estimated future costs to develop the reserves and estimated abandonment costs, net of salvage, will be depleted on the units-of-production method using estimates of proved reserves. Investments in unproved properties and major development projects including capitalized interest, if any, are not amortized until proved reserves associated with the projects can be determined. If the future exploration of unproved properties is determined uneconomical, the amounts of such properties are added to the capitalized cost to be amortized.

The capitalized costs included in the full cost pool are subject to a “ceiling test”, which limits such costs to the aggregate of the estimated present value, discounted at 10%, of the future net revenues from proved reserves, based on current economic and operating conditions and the estimated value of unproven properties (adjusted for related income tax effects).

Long-lived Assets

In accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, we test long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life.

Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.

Asset Retirement Obligations

We recognize a liability for future retirement obligations associated with our oil and gas properties. The estimated fair value of the asset retirement obligation is based on the current cost escalated at an inflation rate and discounted at a credit adjusted risk-free rate. This liability is capitalized as part of the cost of the related asset and amortized over its useful life. The liability accretes until we settle the obligation.

Revenue Recognition

We recognize oil and gas revenue when production is sold to a purchaser at a fixed or determinable price, when delivery has occurred and title has transferred, and if collectibility of the revenue is probable.

Stock-Based Compensation

Prior to February 1, 2006, we accounted for stock-based awards under the recognition and measurement provisions of Accounting Principles Board Opinion (“APB”) No. 25, “Accounting for Stock Issued to Employees” using the intrinsic value method of accounting. Effective February 1, 2006, we adopted the fair value recognition provisions of SFAS No. 123R “Share Based Payments”, using the modified prospective transition method. Under that transition method, compensation cost is recognized for all share-based payments granted prior to, but not yet vested as of February 1, 2006, based on the grant date fair value estimated in accordance with the original provisions of SFAS No. 123, and compensation cost for all share-based payments granted subsequent to February 1, 2006, based on the grant date fair value estimated in accordance with the provisions of SFAS 123R. Results for prior periods have not been restated.

Derivative Liabilities

We record derivatives at their fair values on the date that they meet the requirements of a derivative instrument and at each subsequent balance sheet date. Any change in fair value will be recorded as non-operating, non-cash income or expense at each reporting date.

Recently Issued Accounting Pronouncements

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities – Including an Amendment of FASB Statement No. 115”. This statement permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of SFAS No. 159 apply only to entities that elect the fair value option. However, the amendment to SFAS No. 115 “Accounting for Certain Investments in Debt and Equity Securities” applies to all entities with available-for-sale and trading securities. SFAS No. 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provision of SFAS No. 157, “Fair Value Measurements”. The adoption of this statement is not expected to have a material effect on our future reported financial position or results of operations.

In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB Statements No. 87, 88, 106, and 132(R)”. This statement requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization. This statement also requires an employer to measure the funded status of a plan as of the date of its year-end statement of financial position, with limited exceptions. The provisions of SFAS No. 158 are effective for employers with publicly traded equity securities as of the end of the fiscal year ending after December 15, 2006. The adoption of this statement did not have a material effect on our financial statements.

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

In March 2006, the FASB issued SFAS No. 156, "Accounting for Servicing of Financial Assets, an amendment of FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities". This statement requires all separately recognized servicing assets and servicing liabilities be initially measured at fair value, if practicable, and permits for subsequent measurement using either fair value measurement with changes in fair value reflected in earnings or the amortization and impairment requirements of Statement No. 140. The subsequent measurement of separately recognized servicing assets and servicing liabilities at fair value eliminates the necessity for entities that manage the risks inherent in servicing assets and servicing liabilities with derivatives to qualify for hedge accounting treatment and eliminates the characterization of declines in fair value as impairments or direct write-downs. SFAS No. 156 is effective for an entity's first fiscal year beginning after September 15, 2006. The adoption of this statement did not have a material effect on our financial statements.

In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid Financial Instruments-an amendment of FASB Statements No. 133 and 140", to simplify and make more consistent the accounting for certain financial instruments. SFAS No. 155 amends SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities", to permit fair value re-measurement for any hybrid financial instrument with an embedded derivative that otherwise would require bifurcation, provided that the whole instrument is accounted for on a fair value basis. SFAS No. 155 amends SFAS No. 140, "Accounting for the Impairment or Disposal of Long-Lived Assets", to allow a qualifying special-purpose entity to hold a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. SFAS No. 155 applies to all financial instruments acquired or issued after the beginning of an entity's first fiscal year that begins after September 15, 2006, with earlier application allowed. The adoption of this statement did not have a material effect on our future reported financial position or results of operations.

ITEM 3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Commodity Price Risk

Because of our relatively low level of current oil and gas production, we are not exposed to a great degree of market risk relating to the pricing applicable to our oil and natural gas production. However, our ability to raise additional capital at attractive pricing, our future revenues from oil and gas operations, our future profitability and future rate of growth depend substantially upon the market prices of oil and natural gas, which fluctuate widely. We expect commodity price volatility to continue. We do not currently utilize hedging contracts to protect against commodity price risk. As our oil and gas production grows, we may manage our exposure to oil and natural gas price declines by entering into oil and natural gas price hedging arrangements to secure a price for a portion of our expected future oil and natural gas production.

Operating Cost Risk

We have experienced rising operating costs which impacts our cash flow from operating activities and profitability. We recognize that rising operating costs could continue and continued rising operating costs would negatively impact our oil and gas operations.

Interest Rate Risk

All of our debt has fixed interest rates, so consequently we are not exposed to cash flow or fair value risk from market interest rate changes on this debt.

Financial Instruments

The fair values of financial instruments, which include cash and cash equivalents, other receivables, accounts payable, accrued interest on convertible debentures and accrued liabilities approximate their carrying values due to the relatively short maturity of these instruments. The fair value of convertible debentures are estimated to approximate their carrying values based on borrowing rates currently available to us for debt with similar terms.

Inflation and Changes in Prices

The general level of inflation affects our costs. Salaries and other general and administrative expenses are impacted by inflationary trends and the supply and demand of qualified professionals and professional services. Inflation and price fluctuations affect the costs associated with exploring for and producing oil and natural gas, which has a material impact on our financial performance.

Exchange Rate Risk

The Canadian to U.S. dollar exchange rate has strengthened and may fluctuate over time. As product prices are generally U.S. dollar based, our exposure to currency exchange rate risks are primarily limited to Canadian capital expenditures, Canadian operating costs and the majority of our general and administrative expenses which are paid for in Canadian dollars.

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.

The Company, under the supervision and with the participation of its management, including the principal executive officer and recently appointed principal financial officer, has evaluated the effectiveness of the design and operation of its disclosure controls and procedures as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Act”) as of the end of the period covered by this report (the “Disclosure Controls”). Based upon the Disclosure Controls evaluation, the principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures were not effective in connection with preparing this Quarterly Report on Form 10-Q due to a material weakness in the Company’s internal control over financial reporting, mainly its financial closing, review and analysis process. The Company determined that a restatement of its financial statements was necessary due to the issuance of convertible debentures and warrants (collectively, the “Securities”) in various private placements over the last two years. This restatement is required to properly reflect the Company’s financial results for certain non-cash, and non-operational related charges or credits to earnings associated with both embedded and freestanding derivative liabilities, and the accounting for certain derivatives under the control of the issuer due to the revised interpretation and implementation under Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities, the Emerging Issues Task Force issued EITF Issue No. 00-19, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock, and FASB Staff Position No. EITF 00-19-2, “Accounting for Registration Payment Arrangements.”

The Company believes that the issues surrounding the restatement of this report, mainly the internal controls related to the financial closing, review, and analysis process has been addressed and the Company has taken additional steps to avoid the reoccurrence of this condition by adding an additional qualified person with SEC experience in the financial reporting and analysis area. The Company has instituted a policy requiring the Chief Financial Officer, at the end of each quarter, to reconcile the accounting records to the securities issuance report prepared and maintained by the corporate secretary to ensure that all issuances have been properly recorded and that appropriate adjustments to previously issued securities are recorded, if necessary. The Company believes that these additional efforts taken by new management since the end of fiscal 2008 to strengthen the Company’s internal controls will be effective in future periods.

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

The Company’s internal control over financial reporting has been modified during the Company’s most recent fiscal quarter by adding additional resources to address deficiencies in the financial closing, review and analysis process, which has materially improved the Company’s internal control over financial reporting.

(b) Changes in internal control over financial reporting.

We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities, and migrating processes.

We made the changes as specified above in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have, individually or in the aggregate, a material adverse affect on our business, financial condition or operating results.

Item 1A. Risk Factors.

There have been no material changes from the risk factors previously disclosed in Part I, “Risk Factors,” of the Company’s Annual Report on Form 10-KSB for the year ended January 31, 2007, other than to update certain financial information as of and for the three and/or nine months ended October 31, 2007 regarding the following risk factors.

We Have a History Of Losses Which May Continue, Which May Negatively Impact Our Ability to Achieve Our Business Objectives.

We incurred a net loss of $4,281,969 for the year ended January 31, 2007. For the nine months ended October 31, 2007, we incurred a net loss of $15,270,143. We cannot assure you that we can achieve or sustain profitability on a quarterly or annual basis in the future. Our operations are subject to the risks and competition inherent in the establishment of a business enterprise. There can be no assurance that future operations will be profitable. Revenues and profits, if any, will depend upon various factors, including whether we will be able to continue expansion of our revenue. We may not achieve our business objectives and the failure to achieve such goals would have an adverse impact on us.

There Are a Large Number of Shares Underlying Our Convertible Debentures and Warrants That May be Available for Future Sale and the Sale of These Shares May Depress the Market Price of Our Common Stock.

As of December 6, 2007, we had 46,744,530 shares of common stock issued and outstanding, secured convertible debentures issued on December 8, 2005, January 17, 2006 and June 1, 2006 outstanding that may be converted into 4,876,211 shares of common stock based on current market prices and convertible debentures issued on December 28, 2005 and January 23, 2006 outstanding that may be converted into 2,500,000 shares of common stock. All of the shares, including all of the shares issuable upon conversion of the convertible debentures, may be sold without restriction. The sale of these shares may adversely affect the market price of our common stock.

The Continuously Adjustable Conversion Price Feature of Our Secured Convertible Debentures Could Require Us to Issue a Substantially Greater Number of Shares, Which Will Cause Dilution to Our Existing Stockholders.

Our obligation to issue shares upon conversion of our secured convertible debentures issued to YA Global Investments on December 8, 2005, January 17, 2006 and June 1, 2006 is essentially limitless. The following is an example of the number of shares of our common stock that are issuable, upon conversion of our $6,100,140 remaining face amount of secured convertible debentures (excluding accrued interest), based on market prices 25%, 50% and 75% below the market price, as of December 6, 2007 of $1.53.

			With		Number		% of
% Below	Price Per		Discount		of Shares		Outstanding
Market	Share		at 10%		Issuable		Stock
25%	$	1.1475	$	1.03275		5,906,696		11.22	%
50%	$	0.765	$	0.6885		8,860,044		15.93	%
75%	$	0.3825	$	0.34425		17,720,088		27.49	%

As illustrated, the number of shares of common stock issuable upon conversion of our secured convertible debentures will increase if the market price of our stock declines, which will cause dilution to our existing stockholders.

If We Are Required for any Reason to Repay Our Outstanding Convertible Debentures, We Would Be Required to Deplete Our Working Capital, If Available, Or Raise Additional Funds. Our Failure to Repay the Convertible Debentures, If Required, Could Result in Legal Action Against Us, Which Could Require the Sale of Substantial Assets.

In December 2005, we entered into three securities purchase agreements for the sale of an aggregate of $25,000,000 principal amount of convertible debentures, secured and unsecured. The $15,000,000 in secured convertible debentures, of which $6,100,140 remained outstanding as of December 6, 2007, are due and payable, with 5% interest, three years from the date of issuance, unless sooner converted into shares of our common stock. Additionally, the $10,000,000 in convertible debentures, which all remained outstanding as of December 6, 2007, are due and payable, with 7.5% interest, three years from the date of issuance, unless sooner converted into shares of our common stock. In addition, any event of default such as our failure to repay the principal or interest when due, our failure to issue shares of common stock upon conversion by the holder, our failure to timely file a registration statement or have such registration statement declared effective, breach of any covenant, representation or warranty in the Securities Purchase Agreements or related convertible debentures, the assignment or appointment of a receiver to control a substantial part of our property or business, the filing of a money judgment, writ or similar process against our company in excess of $50,000, the commencement of a bankruptcy, insolvency, reorganization or liquidation proceeding against our company and the delisting of our common stock could require the early repayment of the convertible debentures, secured and unsecured, including default interest rate on the outstanding principal balance of the debentures if the default is not cured with the specified grace period. We anticipate that the full amount of the convertible debentures, secured and unsecured, will be converted into shares of our common stock, in accordance with the terms of the convertible debentures. If we were required to repay the convertible debentures, secured and unsecured, we would be required to use our limited working capital and raise additional funds. If we were unable to repay the debentures when required, the debenture holders could commence legal action against us and foreclose on all of our assets to recover the amounts due. Any such action would require us to curtail or cease operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On September 25, 2007, we issued 591,203 shares of common stock upon conversion of $750,000 of a previously issued convertible debenture. The shares were issued pursuant to an exemption under Section 4(2) of the Securities Act of 1933.

Item 3. Defaults Upon Senior Securities.

None.

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

None.

Item 5. Other Information.

None.

Item 6. Exhibits

31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended

31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14 and Rule 15d 14(a), promulgated under the Securities and Exchange Act of 1934, as amended

32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer)

32.2	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer)

SIGNATURES

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

	TRIANGLE PETROLEUM CORPORATION

Date: April 30, 2008	By:	/s/ MARK GUSTAFSON
	Mark Gustafson
	President (Principal Executive Officer)

Date: April 30, 2008	By:	/s/ SHAUN TOKER
	Shaun Toker
	Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

Nevada		98-0430762
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

	April 30, 2007 As Reported $			Adjustment $			April 30, 2007 As Restated $

Consolidated Balance Sheet

Stockholders’ Deficit
Additional Paid-In Capital		35,910,819			563,064			36,473,883
Deficit Accumulated During the Exploration Stage		(21,055,525	)		(563,064	)		(21,618,589	)

	Three Months Ended April 30, 2007 As Reported $			Adjustment $			Three Months Ended April 30, 2007 As Restated $

Consolidated Statement of Operations
Unrealized gain on fair value of derivatives		2,030,604			(563,064	)		1,467,540
Net loss for the period		(2,862,213	)		(563,064	)		(3,425,277	)
Net Loss Per Share – Basic and Diluted		(0.09	)					(0.11	)

	July 31, 2007 As Reported $			Adjustment $			July 31, 2007 As Restated $

Consolidated Balance Sheet
Stockholders’ Deficit
Additional Paid-In Capital		40,050,268			1,490,182			41,540,450
Deficit Accumulated During the Exploration Stage		(26,009,114	)		(1,490,182	)		(27,499,296	)

	Six Months Ended July 31, 2007 As Reported $			Adjustment $			Six Months Ended July 31, 2007 As Restated $

Consolidated Statement of Operations
Unrealized gain on fair value of derivatives		5,045,596			(1,490,182	)		3,555,414
Net loss for the period		(7,815,802	)		(1,490,182	)		(9,305,984	)
Net Loss Per Share – Basic and Diluted		(0.22	)					(0.26	)

Transaction Date	Secured Convertible Debentures Sold		Annual Interest Rate			Conversion Price		Warrants (one share per warrant)

December 8, 2005	$	5,000,000		5	%		$5.00 or 90% of the average of the lowest three intraday trading prices during the ten trading days immediately preceding conversion		None
January 17, 2006	$	5,000,000		5	%		$5.00 or 90% of the average of the lowest three intraday trading prices during the ten trading days immediately preceding conversion		None
June 1, 2006	$	5,000,000		5	%		$5.00 or 90% of the average of the lowest three intraday trading prices during the ten trading days immediately preceding conversion		None

	October 31, 2007 As Reported $			Adjustment $			October 31, 2007 As Restated $

Consolidated Balance Sheet
Stockholders’ Deficit
Additional Paid-In Capital		41,713,628			1,802,063			43,515,691
Deficit Accumulated During the Exploration Stage		(31,661,392	)		(1,802,063	)		(33,463,455	)

	Nine Months Ended October 31, 2007 As Reported $			Adjustment $			Nine Months Ended October 31, 2007 As Restated $

Consolidated Statement of Operations
Unrealized gain on fair value of derivatives		8,283,568			(1,802,063	)		6,481,505
Net loss for the period		(13,468,080	)		(1,802,063	)		(15,270,143	)
Net Loss Per Share – Basic and Diluted		(0.39	)					(0.44	)

INDEX

PART I.	FINANCIAL INFORMATION

	ITEM 1.	Consolidated balance sheets at October 31, 2007 (unaudited) and January 31, 2007	6

		Consolidated statements of operations for the three and nine months ended October 31, 2007 and 2006 and accumulated from December 11, 2003 (date of inception) to October 31, 2007 (unaudited)	7

		Consolidated statements of cash flows for the nine months ended October 31, 2007 and 2006 (unaudited)	8

		Notes to unaudited consolidated financial statements	9 - 22

	ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23-35

	ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	36

	ITEM 4.	Controls and Procedures	37

PART II.	OTHER INFORMATION

	ITEM 1	Legal proceedings	38
	ITEM 1A	Risk factors	38
	ITEM 2	Unregistered sales of equity securities and use of proceeds	39
	ITEM 3	Defaults upon senior securities	39
	ITEM 4	Submission of matters to a vote of security holders	39
	ITEM 5	Other information	39
	ITEM 6	Exhibits	39

	SIGNATURES		40

	October 31, 2007 $			January 31, 2007 $
	(Unaudited)
	Restated – Note 16)

ASSETS

Current Assets

Cash and cash equivalents		9,343,940			5,798,982
Prepaid expenses (Note 3)		847,408			2,519,009
Other receivables		1,064,343			344,342

Total Current Assets		11,255,691			8,662,333

Debt Issue Costs, net		575,417			916,353

Property and Equipment (Note 4)		72,291			67,091

Oil and Gas Properties (Note 5)		28,045,769			21,101,495

Total Assets		39,949,168			30,747,272

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Current Liabilities

Accounts payable		4,284,914			4,199,961
Accrued interest on convertible debentures		2,474,348			2,095,989
Accrued liabilities (Note 6)		1,939,570			466,112
Derivative liabilities (Note 9)		7,709,289			15,992,857
Convertible debentures, current portion, less unamortized discount of $nil and $515,626, respectively (Note 8(a))		–			2,234,374

Total Current Liabilities		16,408,121			24,989,293

Asset Retirement Obligations (Note 7)		419,365			90,913

Convertible Debentures, less unamortized discount of $6,680,931 and $12,478,642, respectively (Note 8)		13,069,069			10,771,358

Total Liabilities		29,896,555			35,851,564

Contingencies and Commitments (Notes 1 and 13)
Subsequent Events (Note 15)

Stockholders’ Equity (Deficit)

Common Stock (Note 10) Authorized: 100,000,000 shares, par value $0.00001 Issued: 37,704,805 shares (January 31, 2007 – 22,475,866 shares)		377			225

Additional Paid-In Capital		43,515,691			13,088,795

Deficit Accumulated During the Exploration Stage		(33,463,455	)		(18,193,312	)

Total Stockholders’ Equity (Deficit)		10,052,613			(5,104,292	)

Total Liabilities and Stockholders’ Equity (Deficit)		39,949,168			30,747,272

	Accumulated from December 11, 2003 (Date of Inception) to October 31,			Three Months Ended October 31,			Three Months Ended October 31,			Nine Months Ended October 31,			Nine Months Ended October 31,
	2007			2007			2006			2007			2006
	$			$			$			$			$
	Restated – Note 16)			Restated – Note 16)						Restated – Note 16)


Revenue, net of royalties		439,201			191,632			24,540			384,859			24,540

Operating Expenses

Oil and gas production		220,199			146,396			-			220,199			-
Depletion, depreciation and accretion		428,113			151,327			7,590			391,884			19,828
Depreciation – property and equipment		62,036			9,178			24,375			30,792			24,375
General and administrative		17,561,952			1,717,907			1,634,772			5,252,439			6,270,152
Foreign exchange loss (gain)		584,230			467,707			9,170			627,454			(12,086	)
Impairment loss on oil and gas properties		10,795,341			4,604,726			1,041,852			8,496,129			1,086,789

Total Operating Expenses		29,651,871			7,097,241			2,717,759			15,018,897			7,389,058

Net Loss from Operations		(29,212,670	)		(6,905,609	)		(2,693,219	)		(14,634,038	)		(7,364,518	)

Other Income (Expenses)

Accretion of discounts on convertible debentures		(19,470,985	)		(1,704,802	)		(2,766,329	)		(6,313,336	)		(7,463,959	)
Amortization of debenture issue costs		(804,584	)		(109,584	)		(117,707	)		(340,937	)		(294,097	)
Interest expense		(3,102,407	)		(317,671	)		(448,248	)		(1,006,419	)		(1,287,136	)
Interest income		1,091,840			147,416			166,201			543,082			444,957
Unrealized gain on fair value of derivatives		35,286,616			2,926,091			7,147,301			6,481,505			16,724,250

Total Other Income (Expenses)		13,000,480			941,450			3,981,218			(636,105	)		8,124,015

Net Income (Loss) Before Discontinued Operations		(16,212,190	)		(5,964,159	)		1,278,999			(15,270,143	)		759,497

Discontinued Operations		(32,471	)		-			-			-			-

Net Income (Loss) for the Period		(16,244,661	)		(5,964,159	)		1,278,999			(15,270,143	)		759,497

Deficit adjustment related to December 8, 2005 reclassification of warrants from additional paid-in capital to a derivative liability		(17,218,794	)

Deficit accumulated during the exploration stage		(33,463,455	)

Net Income (Loss) Per Share

Basic					(0.16	)		0.06			(0.44	)		0.04
Diluted					(0.16	)		0.05			(0.44	)		0.03

Weighted Average Number of Shares Outstanding
Basic					37,345,000			20,716,000			34,699,000			20,107,000
Diluted					37,345,000			26,716,000			34,699,000			26,107,000

	October 31, 2007 $		January 31, 2007 $

Office space deposit		24,702		–
Prepaid insurance		71,842		151,086
Prepaid joint-venture exploration costs		688,578		2,367,923
Professional and consulting services		32,376		–
Royalty deposit		23,088		–
Software subscriptions		6,822		–

Total prepaid expenses		847,408		2,519,009

	Cost $		October 31, 2007 Accumulated Depreciation $		Net Carrying Value $		January 31, 2007 Net Carrying Value $

Computer hardware		69,708		32,494		37,214		31,906
Furniture and equipment		48,273		15,312		32,961		25,164
Geophysical software		8,000		5,884		2,116		5,086
Leasehold improvements		7,927		7,927		–		4,935

Total		133,908		61,617		72,291		67,091

	October 31, 2007			January 31, 2007
	$			$

Proved Properties
Exploration costs		13,661,354			2,965,420
Less:
Accumulated depletion		(387,303	)		(36,229	)
Impairment costs		(10,795,341	)		(2,299,212	)

		2,478,710			629,979

Unproven Properties
Acquisition costs		10,795,922			14,405,798
Exploration costs		14,771,137			6,065,718

		25,567,059			20,471,516

Net Carrying Value		28,045,769			21,101,495

	October 31, 2007 $		January 31, 2007 $

Alberta		–		6,154,643
East Coast (Nova Scotia and New Brunswick)		8,018,366		654,159

Canada		8,018,366		6,808,802

Arkansas		14,297,692		7,569,101
Rocky Mountains (Colorado, Montana, Wyoming)		2,548,245		2,187,391
Texas		702,756		3,906,222

United States		17,548,693		13,662,714

Total unproven acquisition and exploration costs		25,567,059		20,471,516

	October 31, 2007 $		January 31, 2007 $

Oil and gas expenditures		1,939,570		466,112

	October 31, 2007 $		January 31, 2007 $

Beginning asset retirement obligations		90,913		33,000
Additions related to new properties		–		–
Liabilities incurred		261,180		58,186
Deletions related to property disposals		–		–
Accretion		38,018		1,467
Increase (decrease) due to foreign exchange		29,254		(1,740	)

Total asset retirement obligations		419,365		90,913

	Volatility			Risk Free Rate			Dividend Yield		Term in Years

Weighted Average Assumptions at:
October 31, 2007		74	%		4.04	%		–		1.40

	Shares		Common Stock		Additional Paid- In Capital
			$		$

January 31, 2007		22,475,866		192		13,088,795
Conversion of debentures (c)		4,766,939		47		8,052,016
Private placement (d)		10,412,000		104		20,823,896
Issuance costs (d)		-		-		(1,515,994	)
Investor relations services (e)		50,000		1		108,499
Stock-based compensation (a, b and Note 10)		-		-		2,958,479
October 31, 2007		37,704,805		377		43,515,691

Date	Shares		Common Stock		Face value (net of common stock)		Fair Value of Embedded Conversion Feature		Additional Paid- In Capital
	#		$		$				$

February 20, 2007		108,923		1		249,999		148,079		398,078
March 6, 2007		900,000		9		899,991		-		899,991
March 7, 2007		106,696		1		249,999		140,935		390,394
April 11, 2007		129,333		1		249,999		140,104		390,103
April 30, 2007		128,939		1		249,999		133,945		383,944
May 4, 2007		748,000		7		747,993		-		747,993
May 11, 2007		130,494		2		249,999		135,254		385,253
May 21, 2007		265,041		3		499,997		255,559		755,556
June 15, 2007		279,002		3		499,997		263,994		763,991
June 21, 2007		1,102,000		11		1,101,989		-		1,101,989
June 25, 2007		138,742		1		249,998		134,197		384,195
June 28, 2007		138,566		1		249,999		138,115		388,114
September 25, 2007		591,203		6		749,994		311,880		1,061,874
										-
Total		4,766,939		47		6,249,953		1,802,062		8,052,016

	Number of Options			Weighted Average Exercise Price $		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value $

Outstanding, January 31, 2007		1,630,000			3.31

Granted		1,250,000			2.02
Forfeited		(500,000	)		3.14

Outstanding, October 31, 2007		2,380,000			2.67		3.93		–

Exercisable, October 31, 2007		1,280,000			3.16		3.31		–

	Nine Month Period Ended October 31, 2007

Expected dividend yield		0	%
Expected volatility		129	%
Expected life (in years)		2.5
Risk-free interest rate		4.39	%


	Number of Shares			Weighted-Average Grant-Date Fair Value $

Nonvested at January 31, 2007		782,000			2.80

Granted		1,250,000			1.21
Forfeited		(120,000	)		2.35
Vested		(812,000	)		2.34

Nonvested at October 31, 2007		1,100,000			1.38

	Number of Warrants		Weighted average exercise price $

Balance, January 31, 2007 and October 31, 2007		6,000,000		1.00

Number of Warrants	Exercise Price		Expiry Date

6,000,000	$	1.00		June 15, 2008

2008	$	55,000
2009		220,000
2010		220,000
2011		220,000
2012		220,000

	$	935,000

	Three Month Period Ended October 31, 2007 As Reported $			Adjustment $			Three Month Period Ended October 31, 2007 As Restated $

Consolidated Statement of Operations

Unrealized gain on fair value of derivatives		3,237,972			(311,881	)		2,926,091

Net loss for the period		(5,652,278	)		(311,881	)		5,961,159

Net loss for the period		(0.15	)					(0.16	)

	Nine Months Ended October 31, 2007 As Reported $			Adjustment $			Nine Months Ended October 31, 2007 As Restated $

Consolidated Statement of Operations
Unrealized gain on fair value of derivatives		8,283,568			(1,802,063	)		6,481,505

Net loss for the period		(13,468,080	)		(1,802,063	)		(15,270,143	)

Net Loss Per Share – Basic and Diluted		(0.39	)					(0.44	)